Capitol Action Weekly 3.50


June 19, 2000	CAPITOL ACTION WEEKLY	Volume 3, Number 50

A free weekly newsletter brought to you by Capitol Enquiry, Inc.

Edited by Gabe Anderson

Capitol Reports by Capitol Action Staff

Table of Contents
* Welcome
* Capitol Action
* Clips of the Week
* News & Promotions
* The Fine Print

Welcome

Welcome to this week's Capitol Action. Happy Father's Day to all you dads out there! And a big Happy Father's Day to my own dad, Peter Anderson, the greatest dad a guy could have. Sunday morning my dad, brother Peter, Jr., Jen and I celebrated dad's day at the newly-opened (1999) Presidio Cafe on the Presidio Golf Course here in San Francisco. It is truly a great little place -- and a perfect get-away from the crowds of normal San Francisco dining.
Have a great week!
-Gabe

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Capitol Action for 6.19.00

SACRAMENTO, Calif. -- It's received virtually no media attention, but in less than two weeks the nation's first government-sanctioned, low-cost automobile insurance program is scheduled to begin in Los Angeles and San Francisco counties in what backers hope will serve as a model for the rest of the state.
For months, state and private officials have been quietly working out the details to provide the no-frills, basic policies to more than a million good drivers in two of the state's highest priced areas for auto insurance. The goal is to get more people to buy insurance, thus reducing the number of uninsured drivers which, in turn, reduces the cost of coverage for everyone. At least, that's the theory.
The problem of uninsured motorists has reached epidemic proportions in car-happy California, which has more than 20 million registered drivers. By official estimates, perhaps a fourth of all California motorists drive without insurance, despite a state law requiring that all drivers be covered. In some areas of Los Angeles and San Francisco, that figure is 60 percent or 70 percent, or even higher.
The problem is that insurance is costly and low- and moderate-income people simply can't afford it: Yearly bills of $1,200 or $1,500 for coverage are not uncommon for even inexpensive vehicles. Inner-city drivers, backed by consumer groups, complained to their legislators, and the result was a bill signed last October by Gov. Davis that established the low-cost experimental program to take effect July 1, 2000.
The project, scaled back from the original proposal that would have set up a statewide low-cost system, is being administered by an agency known as CAARP, or the California Assigned Risk Plan, which is a pool financed by insurers to provide coverage for high-risk drivers. The law requires drivers to have coverage; if a conventional company won't insure them, they are assigned to CAARP, which by law must provide coverage.
Now, CAARP will be taking on the additional task of running the low-cost auto insurance program in a move that is being closely watched by other states.
The low-cost policies would provide less coverage than the minimum currently required by law, and the policies would only be available to motorists whose income is 150 percent or less of the federal poverty level, or about $21,000 annually for a family of three. The policies would cost roughly $450 annually -- more for drivers in the 19-24 age group -- and they would provide maximum liability coverage of $10,000 per injury, $20,000 per accident and $3,000 for vehicle damage. Currently, those minimums are $15,000, $30,000 and $5,000 respectively.
Automobile insurers have resisted the creation of a mandatory low-cost program for years. They note that the cost of insurance coverage should be driven by risk, and that to arbitrarily reduce costs for one group of drivers means that another group must pay extra to even out the costs to the companies. In effect, a driver with artificially low rates in Los Angeles is being subsidized by drivers in rural, lower-risk areas, argued the insurers, who successfully blocked efforts to create a statewide low-cost program.
But the politics of insurance is fueled by the complaints of low-income drivers and their advocates. They argued that a low-cost program was needed in order to boost the numbers of drivers with coverage. Ultimately, the Legislature compromised, agreeing to set up such a system but limiting it to San Francisco and Los Angeles.
The real question, of course, is whether this new system will work. Will more drivers get on the insurance rolls? Will their coverage be sufficient to protect them in the event of an accident? The answers to those questions are a mystery now, but by the end of the year we should have an indication of whether this idea will actually work.
If it does, and if both insurers and consumers are pleased with it, the CAARP project may well wind up as a statewide program.

Clips of the Week

--Stuart Leavenworth in the Sacramento Bee, who reported: "Since the 1960s, the University of California has used a textbook formula to build new campuses: Find a low-cost chunk of land, preferably on a hill, where academia can operate in scenic seclusion and have plenty of room to expand. That was the blueprint at San Diego, Santa Cruz, Irvine and Santa Barbara, and now, UC regents are set to try it in Merced. Helped by Gov. Gray Davis, UC officials are preparing to transform eight square miles of rolling pasture, six miles northeast of Merced, into a new campus and "mini-city" that is expected to house 30,000 people. But as UC Merced gains momentum, many are saying a 1960s formula won't work in the 21st century. Environmentalists, farm groups and UC professors are asking why the state wants to build a new town miles from an old one, on ranch land dotted with sensitive wetlands, far from any urban infrastructure." June 18.
http://www.sacbee.com/news/news/local01_20000618.html
--Julie Marquis in the Los Angeles Times, who reported that: "More than half of California adults are overweight, and this unhealthy heftiness has spread to just about every segment of the state's population in the last decade, according to a new analysis of state data. For all the gyms and juice bars in the state -- and despite national hype about beaches peopled with 'Baywatch' bodies -- 60 percent of men and 45 percent of women are overweight or obese, the nonprofit Public Health Institute determined in survey results released Tuesday. Although the problem is most pronounced among African Americans and Latinos, the rates have climbed substantially among whites. The trend cuts across age, income and education levels, causing researchers and health care advocates to label it a public health crisis." June 14.
http://www.latimes.com/news/state/20000614/t000056421.html
--Emily Bazar in the Sacramento Bee, who reported that "Californians with disabilities are demanding that Gov. Gray Davis drop a legal challenge that they say could strip them of civil rights protections guaranteed under federal law. Whether the Democratic governor intended to or not, his request for a U.S. Supreme Court review of a class-action lawsuit has fueled concern among disability-rights groups and some legislators that he's seeking to invalidate a portion of the Americans with Disabilities Act. In particular, they contend that the governor's challenge could render unconstitutional a portion of the law that prohibits discrimination based on disability by public entities, such as state or city governments. On Tuesday, disability-rights advocates from all over Northern California brought their concerns to the steps of the Capitol, carrying signs and chanting, 'What do we want? The ADA! When do we want it? Now!'" June 14.
http://www.capitolalert.com/news/capalert02_20000614.html
--Kevin Fagan in the San Francisco Chronicle, who reported: "That long, lonesome ride to Yosemite National Park could get mighty crowded soon -- with cars full of tourists with slot machines, not nature, on their minds. The Picayune Rancheria tribe of Chukchansi Indians plans to begin construction next month on a gigantic, $167 million casino and hotel resort just outside the park border. The towering complex of blinking neon lights will sprawl across 40 acres at the little town of Coarsegold on Highway 41, the main route heading to the southern entrance of the park. Being about 25 miles from the park, it would be the last big thing you'd see before reaching historic Wawona and then Yosemite's emerald valley of granite and waterfalls." June 14
http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2000/06/14/MN83773.DTL
--Rone Tempest in the Los Angeles Times, who reported: "It is supposed to be the rowdy, raucous lower house of the Legislature; a place where shouting matches and even a few fistfights have been known to erupt. But the calm, deliberate manner in which the California Assembly conducted investigative hearings last week in the scandal surrounding Insurance Commissioner Chuck Quackenbush has won praise on both sides of the political aisle. Among Capitol veterans, who seldom see the Assembly exhibit such decorum, the reaction is something akin to awe. 'It's the best oversight hearing I've ever seen,' said one, 'and I've been watching this place for 30 years.'" June 13.
http://www.latimes.com/news/state/20000613/t000056009.html

Letters

To the Editor,
Suggestion: get rid of the "Welcome" section; it seems to serve your personal needs, not this readers' [sic]. Frankly, I'm not particularly interested in what you and your dog and girlfriend did last weekend.
- Joe DiLeo, Jr.
To the Editor,
I read your newsletter each week and find it both entertaining and educational. I applaud your efforts. With regards to [last week's] letters to the editor whining that you inadvertently left the word "women" out of your Memorial Day comments, don't fret. Those individuals obviously have nothing better to do than to focus on the negative. I pity them for not being able to see past their own self interests. Keep up the good work.
- Barbara Daly
Orange County, Calif.
To the Editor,
I'm from Australia and love reading Capitol Action Weekly. I am actually out here trying to do some networking in Sacramento. It would be great to work there. I've spent some some time with Lou Papan and Elaine Alquist, who have been great.
Just thought you would like to hear a good comment, despite what some of the readers think about neglecting to write that women were brave also. I think you should be commended for everything you contribute to your article, that is not only informative but carries wit and intelligence rarely seen in reporting these days.
All the best.
- Adam Davids
Melbourne, Australia