Agency move on repair service at issue
SACRAMENTO — The Schwarzenegger administration is facing questions about a flip-flop in which it barred a major insurance company from running an auto repair service, then reversed course and let the company operate the program after all.
The issue was expected to come up today during a scheduled Senate confirmation hearing for one of the governor's political appointees: Sherry Mehl, head of the bureau that oversees the car repair industry.
But Mehl's hearing was postponed until June 20, in part because lawmakers want more answers about why her bureau took the steps it did, Senate officials said.
In advance of the hearing, Sen. Mark Ridley-Thomas (D-Los Angeles) sent Mehl a series of questions about the bureau's actions with respect to Progressive Group of Insurance Cos., the nation's third-largest auto insurer.
In August, the Bureau of Automotive Repair had made a ruling against Progressive's interests, ordering that a "concierge" shop that arranges car repairs for its customers in San Diego be shut down because it lacked an auto repair license. Four months later, the office rescinded the order.
The reversal "warrants explanation," Ridley-Thomas said.
He said that "the bureau seemed to have been falling down on the job with respect to enforcing existing policy."
A state investigator who led the automotive bureau's inquiry into Progressive's practices said in a legal deposition last month that he opposed his bosses' decision to overturn the order. Eugene P. Kendall said that as he was gathering evidence late last year that Progressive was operating as an unlicensed repair dealer, he was told abruptly to stop the probe.
In accommodating Progressive, the Schwarzenegger administration has drawn complaints from consumer groups and car-repair businesses alike.
Last week, the Consumers for Auto Reliability and Safety nonprofit group wrote to Senate President Pro Tem Don Perata (D-Oakland) asking that lawmakers examine the bureau's actions while considering Mehl's appointment.
Rosemary Shahan, president of the group, said a bill introduced in the Legislature in recent years would have authorized Progressive's program, but it failed to pass. By approving the program through executive fiat, the Schwarzenegger administration circumvented the Legislature, she said.
Progressive "didn't get what they wanted legislatively, so they're getting it administratively," Shahan said. "I suspect it has to do with access to the governor."
