Jockeying for Rare Political Plum Begins 2 Years Early

It’s still two years and a Supreme Court ruling away.

But already some prominent politicians are positioning themselves to pick a rare political plum--the first new statewide elected office in California in this century.

If Proposition 103, the sweeping insurance reform measure approved by voters on Nov. 8, survives pending legal challenges, the appointive position of state insurance commissioner will become an elected post for the first time in 1990.

And many political observers see it as a high-profile office that could be a springboard to the governor’s mansion, even rivaling established stepping-stone offices such as attorney general.

“There’s no question about it being a big office,” said Peter Kelly, state Democratic Party chairman. “You get to deal with the hottest topic around.”

“This will be a major-league office,” said Tom Stickel, finance chairman for the state Republican Party.

No Incumbent to Challenge

With no incumbent to battle--the current appointed commissioner, Roxani Gillespie, said she will not run--the post is particularly attractive to ambitious young politicians who want to take a stab at statewide office but are unwilling to challenge established officeholders.

The insurance commissioner controls an agency with 515 employees and an annual budget of $33 million that is charged with regulating the industry and enforcing the insurance code.

Among those said to be interested in the position are Assemblyman Tom Hayden (D-Santa Monica), State Board of Equalization member Conway Collis and Los Angeles City Atty. James K. Hahn.

Also mentioned as possible contenders are state Sen. John Garamendi (D-Walnut Grove), Sen. William Campbell (R-Hacienda Heights), Sen. Alan Robbins (D-Van Nuys) and television commentator Bill Press, who earlier this year ran, then withdrew, in the race for the Democratic Party’s U.S. Senate nomination, ultimately won by Lt. Gov. Leo T. McCarthy.

Harvey Rosenfield, the author of Proposition 103 and founder of Voter Revolt, the organization that successfully campaigned for the measure, is considered by many to be the logical candidate to carry the consumer’s banner into the election. But he said he is not interested in running for any political office.

Hayden said “it’s a rumor” that he is interested in seeking the position, “and I did not generate the rumor.” He added, “I have not focused on it.”

Collis, said: “I don’t deny that the office is a critically important and challenging one, but there are a great many questions that have to be answered about it before I’m in a position to make a decision.” Collis said he has been asked by Voter Revolt to help in campaigning for the measure’s implementation and its legal defense.

Eyeing Possible Offices

Collis has earlier made it clear that after two terms on the State Board of Equalization he would like to run for some statewide office in 1990 and had been eyeing the offices of treasurer, controller and lieutenant governor.

An aide to Hahn acknowledged that the city attorney would be “on a list of those interested.” Hahn was one of the first elected officials in California to publicly support and help raise funds for the Proposition 103 campaign.

Other potential candidates will surely surface in the coming months. As one prominent Democrat said, expressing the views of many, “just about any state senator with a free ride (not up for reelection) in ’90 will take a look at it.”

It is likely that most of those surfacing will be Democrats.

“There’s a feeling that the insurance commissioner, more than any other office, will be a Democratic springboard to governor,” said one Republican official, noting the historically strong ties of the business community and the GOP.

Republican Not Likely

“It’s not an office the electorate will trust to a Republican,” he said.

“It will be a difficult seat for a Republican to run for, at least the first time,” said Stickel, citing the fact that Proposition 103 was opposed by Gov. George Deukmejian and most other Republican officeholders.

“I think it’s a given” that the position will be won by a Democrat, Kelly said. “It will be tough for a Republican to win.”

But while some are enthusiastic about the office’s prospects, observers from both parties say it comes with a host of potential problems.

The most immediate stumbling block is a group of lawsuits pending before the Supreme Court questioning the constitutionality of the proposition.

Court Imposes Stay

Within two days after the voters’ approval, the state’s high court imposed a stay on Proposition 103 that has kept it from taking effect.

It is not clear when the stay might be lifted. It is also not clear whether a test of constitutionality would affect only certain provisions of the measure or the entire proposition.

Should it withstand the legal challenges, there are still questions about the exact powers of the commissioner, the level of staffing, the budget and salary.

It is possible, some observers said, that legislation could be quickly introduced and passed that could affect any or all of these elements.

One of the most troubling questions for potential candidates is just what is the real condition of the state’s insurance companies. Assuming that it is ruled constitutional by the courts, Proposition 103 will require insurance companies to grant immediate 20% rate rollbacks.

Commissioner’s Decision

The companies could ask the insurance commissioner for permission to raise those rates but would have to prove that the 20% cut would threaten them with insolvency. The insurance commissioner would have to decide whether to grant a waiver and will be getting plenty of advice from all sides.

Consumer advocates say the insurers are packing away outrageous profits. But the companies say they have lost millions of dollars on auto insurance in particular.

If the commissioner decides to allow the rate increases, there would be a heavy political price to pay. “That’s not exactly a Populist position to take,” said one potential candidate.

Or as John Emerson, an aide to Hahn, said: “The first person elected to the position could be accountable for things beyond their control or authority.”

But with that risk, Emerson said, comes a potentially great reward for those in public service--”the opportunity to have a first crack at reforming a system badly in need of reform.”