Governor Gavin Newsom has vetoed a bill aimed at providing tax relief for victims of the 2020 Mill Fire and 2021 Dixie Fire. Senate Bill 542, authored by Senator Brian Dahle and co-authored by Megan Dahle, proposed income and corporate tax exclusions for wildfire settlement payments between 2020 and 2022. However, the governor rejected the bill on September 29, stating the need for fiscal discipline.
In his veto message, Newsom explained that while he supports the intent of the bill, he believes such measures should be part of the state’s annual budget process. He pointed out that similar tax exclusions had been handled in previous budget acts and warned against passing bills with significant fiscal implications outside of the budget framework. This approach, he said, helps protect critical investments in education, health care, and public safety.
The bill is now back in the Senate, where lawmakers are considering whether to accept the veto or attempt to override it. To override the veto, the Senate and Assembly would need a two-thirds majority vote. However, an override is unlikely, as the Legislature has not overridden a governor’s veto since 1979.
