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Debt Collectors Barred From Garnishing Californians’ Stimulus Payments

Newsom2 - Beth LaBerge-KQED.jpg
Beth LaBerge/KQED
Gov. Gavin Newsom speaks during a press conference at the Bloom Energy on Mar. 28, 2020. Bloom Energy is a fuel cell generator company that has switched over to refurbishing ventilators as more patients experience respiratory issues due to COVID-19.

Californians who have had their federal stimulus payment garnished by debt collectors should have that money returned after Gov. Gavin Newsom signed an executive order to ban the practice.

It applies retroactively, he said.

“Now is not the time to garnish those emergency contribution checks,” Newsom said.

It does not apply to payments garnished from people who owe child support, spousal support or victim restitution.

Newsom also announced California has signed onto an agreement led by the governor of Illinois with 21 of the nation’s largest private student loan servicers to allow up to 90 days of payment forbearance.

The deal will affect more than 1 million Californians with student loan debt, with “no impact to their credit rating, no late fees or fines and actual support in terms of getting new payment plans in place for future processing,” Newsom said.

The day after President Trump promised to send at least 100,000 additional test swabs to California, Newsom announced the first 90,000 would be arriving Friday.

The swabs are in high demand as states including California struggle to ramp up their capacity to test for the virus.

“Promise made, promise kept,” Newsom said of the commitment he had received from the president.

While Newsom remains complimentary of Trump, he took a swipe at Republican Senate Majority Leader Mitch McConnell for suggesting he would be unwilling to financially support states during the pandemic and subsequent economic fallout.

The Democratic governor called McConnell’s comments “offensive” and said he “hope[s] and expect[s]” the Kentucky Senator to take them back.

Meanwhile, Newsom is fielding requests from cities and counties to begin reopening part of their local economies. But he reported a record 115 deaths over a 24-hour period Thursday and said it’s too soon to think about reopening businesses.

Some counties have moved to open parks, beaches and golf courses but are still unable to loosen beyond what the statewide stay-at-home order mandates.

“All of us are trying to work this out in real time,” Newsom said. “We really want to think about this regionally as a framework — regions rising back up together.”

The governor emphasized that the stay-at-home order has successfully flattened California’s curve, but said it would only continue to be successful if people continue to follow it.

“Your individual actions impact others,” he said. “This is not a Republican virus or a Democratic virus. It’s not an urban virus or a rural virus. … It’s impacting every part of California.”

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