Margolin Takes Aim at Laws He Says Dilute Prop. 103

Assemblyman Burt Margolin on Wednesday proposed legislation to repeal recent state laws that he and consumer advocates say illegally dilute Proposition 103--the 1989 insurance rollback initiative--and cost Californians hundreds of millions of dollars.

Margolin, a Los Angeles Democrat who is expected to officially announce his candidacy for state insurance commissioner this week, unveiled his plan at a news conference in Sacramento, accompanied by Proposition 103 author Harvey Rosenfield and the leaders of three prominent consumer advocacy organizations.

One of the laws Margolin is targeting, which exempts surety companies from Proposition 103, is the subject of a lawsuit that has been appealed to the state Supreme Court. Surety companies write performance guarantees for a range of businesses, from construction companies to movie studios.

A state appeals court ruled in December that the law was unconstitutional because the Legislature has no right to amend a voter initiative in a way that defeats its original purposes.

Margolin said the ruling, plus the support of consumer groups Consumers Union, California Common Cause and the Center for Public Interest Law may give his plan the momentum to reverse what he termed an anti-Proposition 103 drift in the Assembly.