This week, a new study was released from Sacramento State that the total cost of regulation to the State of California is $492 billion! The study can be found here.

Today, along with several of my Assembly colleagues and representatives from the business community, including the California Manufacturers and Technology Association and the Sacramento Metro and California Hispanic Chambers of Commers, I attended a press conference to highlight the study and discuss the need for reform of California’s system.

Below is a video of my comments at the press conference. Our apologies for the low audio. Please make sure your volume is turned up.

Last week in the Legislature, I had a very interesting experience as a member of the Assembly Business and Professions Committee. Once again, the hearing shows just how far some of my colleagues would go in their desire to regulate and over regulate ordinary Californians who are just looking to make a living running a business and providing jobs.

The Chair of the Committee, Assemblymember Mary Hayashi, called an “informational” hearing to discuss the issue of auto body fraud. While I wasn’t sure why before, and I’m certainly not sure why after, Ms. Hayashi contends that rampant fraud exists in the auto body repair business and new legislation from her to stop this fraud will likely be warranted.

The only problem was, the Chair didn’t seem to listen to the testimony presented during the hearing. For about an hour, the committee heard from representatives from the Bureau of Automotive Repair (BAR) and the Department of Insurance who actually painted a picture of very low auto body fraud rates. The Chief of the Bureau of Automotive Repair, Sherry Mehl testified during the hearing that “…in regards to all of the auto repair that BAR regulates, auto body is a very small percentage of the fraud we see in the industry.”

Ms. Mehl brought statistics with her and testified that out of 8,932 shops licensed by the BAR, only about 18-20 complaint investigations uncovered actual fraud. This shows that certainly action is taken where needed, but this hardly rises to the level of a rampant problem.

Department of Insurance testimony ran along the same lines. Rick Plein, the Deputy Commissioner of Enforcement branch testified that of all the fraud complaints received by the Department each year, less than four-tenths of one percent involve an auto body shop.

When Chairwoman Hayashi began to adjourn the committee with a speech that implied that fraud was indeed rampant despite all of this testimony, I had to challenge her. Here is an audio recording of that exchange.

Unfortunately, less than an hour after the hearing had adjourned, the chair issued this press release citing numbers that were never even presented at the hearing.

Obviously, Assemblymember Hayashi has issues here, I just don’t know what they are.