Workers' Comp Law Expected by Consultant

California horsemen, saddled with heavy workers' compensation insurance loads, may finally be getting some legislative relief, an industry lobbyist said Tuesday.

George Soares, the legislative consultant for the California Authority of Racing Fairs, expects the latest wagering take-out bill designed to help the situation to become law.

"I think it will pass and I think the governor will sign it," Soares, CARF's lobbyist, told a group of satellite conference representatives meeting in Monterey, Calif.

Assembly Bill 1838, introduced by Jerome Horton (D-Inglewood), passed the Assembly Governmental Organization Committee on March 18 and is scheduled to be heard by that body's insurance committee this week.

It would increase the take-out for Thoroughbred races by a half-percent on exotic wagers (all but win, place and show), from 20.18% to 20.68%. But it also contains key provisions lacking in a similar bill that overwhelmingly passed both halves of the legislature but was vetoed by Gov. Arnold Schwarzenegger earlier this year.

Soares said he was pleased to see that the newest version of the legislation has racing fairs included in representation of the 34-vote organization that will oversee allocation of the proposed workers' compensation fund.

The legislation is expected to generate $8 million annually to help offset insurance costs in the racing industry.

Racing should get additional relief if a comprehensive workers' compensation insurance measure is approved, Soares said.

Schwarzenegger expects the legislature to pass reductions that could save businesses in the state $11 billion a year, Soares told the conference. Currently, the Democratic-controlled legislature has identified potential cost savings of about half that amount.

Schwarzenegger, flexing his muscles after getting voters to overwhelmingly back a $15 billion bond to cover the state's budget shortfall three weeks ago, has told lawmakers he'll put a stringent workers' compensation ballot measure before the voters in November if the legislature doesn't act.

Soares, who also represents a variety of agricultural interests, said there has been a new spirit in Sacramento, at least on the surface.

"As for now, we have a government that is semi-functional," Soares said, noting that there was only bickering and stubbornness under the previous governor, Gray Davis, who was recalled in October.

"There's an absolute parade of legislators to (Schwarzenegger's) office almost daily. But even with the passage of the bond, we're still $7 billion away from solving the budget issue," Soares said. "This will be a major test of his popularity when he has to start cutting peoples' programs. Right now, this governor is on a roll. There isn't anyone in the state who doesn't know how much of a drag workers' compensation is on the economy, maybe even more of one than the budget.

"You may see a ballot measure this year," he added. "I say may because (Schwarzenegger) is about halfway there to getting the legislature to go along with him. The compromise may not be all that he wants, but it may be enough" to avert a costly election fight.

The lobbyist said a racing-backed slot machine proposal overlooks the fairs. The measure, which proponents want to qualify for the November ballot, could put up to 30,000 machines at five tracks and 11 card clubs in the state.

"The fair industry needs to be part of that equation," Soares said. "Five million dollars would flow to the fairs if the measure goes into effect. It remains to be seen if the fair industry will support the initiative."