Solutions to solve the state’s affordability crisis are being proposed by legislators in Sacramento, but they continue to be blocked or ignored. Many of us have announced bills that help lower costs for residents across the state. California families are paying more for gas, housing and everyday basics.
Working Californians should not have to choose between putting food on the table or filling up their car. We need to cut costs now, and it can be done with the right decisions by our state’s leaders.
One of my bills, AB 1596, provides consumers with a partial sales-tax exemption for the purchase of infant car seats. This allows parents to buy these items without the additional cost of the state portion of the sales tax. Nothing is more important than the safety of an infant or toddler, and car seats can add up. Simply eliminating the state sales tax on these mandatory expenditures allows a small but significant financial relief to families that are already stretched thin.
Another bill, AB 1550, offered by Assemblymember Kate Sanchez, authorizes Californians to deduct qualified tips and overtime compensation from the state income tax of service workers. This proposal aligns with the new federal tax law that allows individuals in the service industry to keep more of their hard-earned income.
Housing affordability may be the most common concern among Californians. Firsttuesday Journal (Orange County housing indicators | firsttuesday Journal) recently reported that the average cost of renting in Orange County increased 75% since the pandemic. Another study by MortgageCalculator (Where in the U.S. Have Home Prices Increased the Most Since the Start of the COVID-19 Pandemic?) shows that between 2020 and 2024, the average home price in Irvine increased by 82.99%. Irvine had the highest increase in prices nationwide!
New data from the University of California, California Policy Lab finds that Californians who leave the state pay less for housing and are more likely to own a home. On average, movers relocate to places where housing costs are $672 less per month.
People moving out of California increasingly come from higher-income neighborhoods and appear financially weaker than their neighbors. The share of exits from higher-income neighborhoods rose 19% over the past decade. Those who leave have $5,500 more in student debt, on average, and credit scores that were 17 points lower than their neighbors.
Early in his tenure, the governor offered to build 3.5 million new homes in California. This has not happened. Lack of new housing has contributed to skyrocketing costs. In 2020, the median age for the first-time home buyer was 33 years old. Five years later, the median age grew to 40, a record high. Another new bill, AB 1714, addresses this issue by creating a personal income tax credit for first-time homebuyers.
Two other bills would help residents with high energy bills: AB 1757 allows the expansion of the use of nuclear energy with the goal to help lower state energy costs and increase reliability. AB 2700 proposes a cut to electricity rates simply by targeting waste and utility spending.
The rising cost of health care is increasingly taking a larger share of the family budget. According to the California Policy Center, many middle-income households no longer qualify for financial assistance. Some are seeing annual cost increases of $4,000 to over $11,000 depending on region and plan.
Even subsidized enrollees are paying more. Lower-income households may see average increases of around $500-$1,200 annually, and roughly 160,000 Californians have lost eligibility for subsidies altogether. This creates a significant affordability gap for those who earn too much to qualify but still struggle with costs.
Finally, my colleagues and I have voted seven times to suspend the state’s gas tax. The measure has lost every time.
It has always been my belief that California doesn’t have a revenue problem — it has a spending problem. Our leaders continue to force our state into a chronic deficit. This is why residents continue to feel anxious about their finances.
Of the 2026 proposed budget, Legislative Analyst Gabe Petek says it will force the state into multiyear deficits estimated between $20 billion to $35 billion annually. According to CalMatters, in the seven budgets Gov. Newsom has signed, revenues have increased by 60%, mostly from taxes that include a 48% increase in personal income taxes. Total spending, however, jumped 72%, from $203 billion to $349 billion.
We must continue to be united and focused on protecting California’s financial stability and avoiding the kind of budget crises that hurt working families and retirees the most.
Laurie Davies was elected to the State Assembly in 2020 and reelected in 2022 and 2024. She represents the 74th Assembly District, which includes San Clemente, Dana Point and San Juan Capistrano.
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