Governor Visiting Costco for Bargains on Signatures

Gov. Arnold Schwarzenegger, bidding to dramatically cut business costs in the state, is turning to an unexpected ally: Costco, a no-frills, discount wholesaler known for selling its ketchup and tires in bulk.

To the surprise of many customers, he was at a store in Burbank on Monday shopping not for bargains, but for signatures to place on the November ballot an initiative that would overhaul the state’s $20-billion workers’ compensation system that aids workers injured on the job.

Trolling for signatures in shopping mall parking lots is commonplace. What’s unusual is the partnership between the governor of California and the nation’s 29th largest corporation that allows him to market his political agenda in the aisles of a giant warehouse store and with the help of its paid staff.

“It’s extremely unusual in California politics and probably could not be duplicated by anyone other than a celebrity politician,” said Harvey Englander, a Los Angeles political consultant.

“I know when I visited a Costco right after this was announced, people were lining up to sign the petitions. Arnold brings to politics and government all the marketing skills that he learned from his career as a bodybuilder and actor.”

Today, he returns to Costco, this time in Sacramento. It will be his third trip to the store for signatures in the past month. Each day inside its 98 stores in California, Costco employees set up tables and ask shoppers if they would like to sign the petitions.

The Costco involvement prompted a complaint last week from the Teamsters Union, which represents about 11,000 of the company’s California workers. The union has sent a letter to state Atty. Gen. Bill Lockyer asking him to look into whether Costco was forcing its employees to engage in political activity. Lockyer’s office has not yet taken any action on the request, a spokesman said Monday. Costco said its employees volunteer, and there has been no coercion.

This campaign is about more than signatures. Schwarzenegger is using the petition drive to prod lawmakers to come up with a legislative solution to revamp workers’ comp. Leaders in the Legislature are negotiating the final details of an overhaul this week.

Facing an April 16th deadline to turn in signatures to qualify the measure for the ballot, the governor needs 598,105 registered voters to sign. Costco’s cavernous warehouses are rich territory, drawing steady streams of bargain-hunting customers.

For its part, Costco wants to reduce a workers’ comp bill that costs its California stores $60 million a year, according to Bruce Greenwood, senior vice president for the company’s greater Los Angeles region. While 40% of Costco employees work in California, the state accounts for 70% of the corporation’s total workers’ comp costs.

“There’s a great disparity there,” Greenwood said.

So far, Schwarzenegger and Costco are working mightily to deliver for one another. Costco, a publicly traded company based in Washington state, accounts for more than 18% of the 800,000 signatures the governor’s forces have gathered to date. That has saved Schwarzenegger substantial sums. The more signatures that Costco provides free of charge, the less the governor must spend on his team of paid signature-gatherers.

Since March 21, the campaign committee that is promoting the workers’ comp initiative has reported getting $127,895 in in-kind contributions from Costco.

And the governor’s visits are a magnet for customers and TV camera crews -- though Greenwood said the company isn’t courting the attention.

At the store in Burbank on Monday, Schwarzenegger was swarmed by shoppers wanting his autograph. He signed $20 bills, books and scraps of paper. Angling himself to give the cameras the best possible shot, the governor held up a clipboard displaying his petitions. He thanked Costco for its help.

“Costco has been a wonderful worker in helping me gather the signatures,” the governor proclaimed at Monday’s event. “A big hand for Costco!”

For a governor who portrays himself as a populist, the Costco pairing is a natural. The company did $42.5 billion in worldwide sales last year, but it is known as a place where its cost-conscious members can save by buying in bulk.

“He’s very careful to say, ‘I’m not your typical politician.’ And one way to do that is to go out and deal with real people,” said Barbara O’Connor, director of the Institute for the study of Politics and Media at Cal State Sacramento. “The perception is that politicians don’t talk to real people. So what better place to go than Costco?”

Schwarzenegger struck that note on Monday, when asked why he chose to visit Costco rather than spend the day in the Capitol, negotiating with lawmakers over a final workers’ comp reform bill.

“This is what the people want to see. They want to seen an action governor -- not someone who sits around the office in Sacramento, not doing anything,” Schwarzenegger said.

At Costco stores around the state, the setup is much the same. Staffers place a table inside the entrance where signature-gatherers can talk to shoppers as they head into the store.

While one employee staffs the table, others fan out through the store. The signature gatherers are employees who are being paid their regular hourly wage, but they volunteer for the duty.

The Costco in Hawthorne, just off the 405 Freeway, provided a typical scene. Four employees there have volunteered for the petition drive and two are gathering signatures at any one time.

Christina Hernandez, 24, of Inglewood, staffed the table in Hawthorne last week. Pregnant with her third child, Hernandez, who has worked at Costco for four years and makes $14 per hour plus benefits, usually works in the clothing section.

She sits at the table, which is next to a display of Hewlett Packard laptop computers and directly across from a stack of jelly bean bags. She volunteered for two reasons, she says: her respect for Schwarzenegger and her conviction that too many workers in California are defrauding the workers’ comp system.

“Are you a registered voter, ma’am? Puede votar en California?” Hernandez asks passing shoppers. She targets shoppers that don’t look as if they’re in a hurry. If a shopper approaches her, she asks: “Has anybody told you about the workers’ comp?”

Tonya Hawkins, a homemaker from the Torrance area who is shopping with her young daughters, ages 4 and 1, says no. Hernandez sizes her up. The Costco employees have no script to follow, but Hernandez uses versions of three arguments: workers’ comp costs are hurting businesses and thus making it harder to get jobs, the workers’ comp system is beset by fraud, and Schwarzenegger supports it.

“A lot of people are going out of business because of it,” Hernandez tells Hawkins, adding “the governor is trying to put it on the ballot.” That triggers Hawkins’ memory. She had seen Schwarzenegger on TV talking about the importance of signing petitions.

“He said to sign it,” Hawkins says, as she takes the clipboard from Hernandez and adds her name to one of the 10 lines for signatures on the white and yellow petition. “And I’m trying to give him a chance.”

So is Cathy Mejia, the next to sign. “I remember hearing speeches about the high costs to businesses -- one of Arnold Schwarzenegger’s speeches,” says Mejia, a Girl Scout leader shopping for snacks to feed her troop.

Hernandez gets a variety of reactions. About half the people she approaches brush past -- they are either too busy or are not registered to vote. And one man answers her appeal with flirtation. “I’m looking for someone to take care of me,” he says.

Times staff writer Jeffrey L. Rabin contributed to this report.