Schwarzenegger Committee Donates $1 Million to Workers’ Compensation Ballot Initiative

Gov. Arnold Schwarzenegger (R) on Friday donated more than $1 million from his chief political committee, the California Recovery Team, to the drive to put a workers' compensation reform initiative on the November ballot, the Los Angeles Times reports (Los Angeles Times, 3/16). As part of his "California Recovery Plan," Schwarzenegger in November proposed reducing by $11.3 billion the cost of the state's $29 billion workers' compensation program. Schwarzenegger's plan includes measures that would prohibit workers from receiving multiple disability payments for the same injury; require dispute resolution more frequently to reduce litigation costs; limit penalties paid by insurers and employers in medical bill disputes; and establish uniform standards for permanent disability. Schwarzenegger said he would seek to place a measure on the November statewide ballot if legislators did not pass reform legislation by March 1. However, Democrats in the Legislature have said that no workers' compensation reforms will be ready until the end of March (California Healthline, 3/4). Marty Wilson, a consultant for the California Recovery Team, said that the money is "a down payment" on the cost of collecting by April 16 the 598,105 valid signatures necessary to get the initiative on the ballot. According to the Times, signature gatherers were "out in force" over the weekend (Los Angeles Times, 3/16). On Tuesday, Schwarzenegger "ramped up pressure" on lawmakers to pass a workers' compensation reform bill by asking farmers to support the ballot initiative, the Sacramento Bee reports (Talev, Sacramento Bee, 3/17). Schwarzenegger said, "I know that when we put this on the November ballot, we will ... be very successful." Vince Sollitto, deputy press secretary for Schwarzenegger, said, "The ballot initiative is an important backstop just in case the legislative attempts fail" (Calbreath, San Diego Union-Tribune, 3/17).

Summaries of other recent workers' compensation news are provided below.

• State Controller Steve Westly (D) last week sent a letter to Schwarzenegger and legislative leaders requesting that lawmakers "boost government oversight or sever ties" with State Compensation Insurance Fund, the Bee reports. The quasi-public State Fund, which controls more than 50% of the state workers' compensation insurance market, is administered by a board of directors appointed by the governor, and is not directly accountable to state officials or legislators. Westly said that lawmakers should disassociate State Fund from the state financial structure, a move that would put it under the "tougher standards that private insurers must follow and greater oversight by the Insurance Department," the Bee reports. Westly said that lawmakers also could give his office or the Insurance Department "increased audit authority or oversight" of State Fund. Jim Zelinski, a spokesperson for State Fund, said that officials are reviewing Westly's letter but added, "We are on solid financial footing. This is a technical financial issue" (Chan, Sacramento Bee, 3/13).
  
  
• Campaigns for or against a workers' compensation ballot initiative could cost as much as $40 million and "could eat up resources that would otherwise go to initiatives dealing with health insurance" and other issues, the Sacramento Bee reports. In addition, "both sides know how vulnerable support could be once an anti-initiative campaign got under way and how emotionally charged and confusing the debate could become," according to the Bee. Darry Sragow, a political consultant for Assembly Democrats, said, "There are a long list of the things the governor and Legislature know they have to deal with, and if they can dispose of this without going to a ballot measure campaign, they're going to be very relieved" (Talev, Sacramento Bee, 3/16).