The new law, AB 711, was authored by Assemblyman Evan Low, D-Campbell.
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He was motivated to change the rules when the Super Bowl came to Santa Clara in 2016. Low did not feel sports fans had enough options to get home safely from events involving alcohol.
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Opponents of the new law say it encourages people to drink more heavily.
Industry watchdog, Alcohol Justice, writes on its website, "While drunk driving is serious concern to public safety, and efforts to reduce it should generally be applauded, this bill implicitly allows for beer manufacturers to promote the overconsumption of alcohol."
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People who were out and about in Campbell Tuesday night said it sounded like a good idea to them.
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One man said he doubted a discounted ride would change a person's drinking habits.
ABC7 News reached out to ride share companies Uber and Lyft for their thoughts on the new law but the companies have not yet returned our request for comment.