A reform of California's Workers' Compensation system is working, Gov. Arnold Schwarzengger said

Schwarzenegger claims workers' comp reforms have begun working

Timothy Roberts

A reform of California's Workers' Compensation system is working, Gov. Arnold Schwarzengger said during a San Jose visit Aug. 25 to tout the benefits of the recent changes.

Standing in front of carefully stacked 12-inch Alumaflex duct coils at Acosta Sheet Metal Manufacturing Co. Inc. on Remillard Court, Schwarzenegger said the reforms have lowered workers' comp costs 30 percent.

"These reforms have sent a clear message that California is once again open for business," the governor said.

According to the office of Insurance Commissioner John Garamendi, the average rate for workers' comp has dropped 26.78 percent this year. Garamendi said rates should come down several points more.

Sal Acosta, the owner of the factory, came close to closing his plant two years ago, in part because of his workers' comp rates. Since last year's reforms, his rates have dropped by $200,000, he said.

"We are much stronger due to workers' comp reform," he said.

Acosta started his metal shop in 1972 after successfully making pizza tins for the Campbell School District. His parents were immigrants from Mexico. He was born in Whittier but was orphaned after his family moved to San Jose a few years later.

Today his shop does "$10 million-plus" in sales, he says. He has 80 employees.

Schwarzenegger took credit for the expansion of the California economy, saying that 400,000 jobs have been created since he took office in late 2003. He said further reforms were needed as he glancingly referred to ballot initiatives he is pushing for this fall. He wants to change the way election districts are drawn, make teachers wait five years for tenure instead of two years, and limit the growth of state spending.

A poll by the California Public Policy Institute shows none of the ballot initiatives polling higher than 49 percent. The governor drew only a 34 percent approval level himself.

Not to worry, says the governor.

"It's all about messaging and education," he told reporters. He will convince the voters in the last six to seven weeks of the campaign, he promised.

Pat Dando, the governor's liaison to local government and the incoming president and CEO of the San Jose Silicon Valley Chamber of Commerce, said the governor has not told her if he will run for re-election in 2006, but she said to expect a decision in the next few weeks.

On Aug. 24, the governor told radio listeners that he was "in for the long haul," although a spokesman for Schwarzenegger, Vince Sollitto, wasn't able to say if that meant that Schwarzenegger would be on the ballot in 2006.

Roberts is a reporter for the Silicon Valley/San Jose Business Journal.