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Monday, 04 June 2007 16:25

State Farm buys a seat at Schwarzenegger’s table with $25,000 donation

    The auto insurance arm of State Farm insurance made a $25,000 donation in April to Gov. Arnold Schwarzenegger’s California Recovery Team fund. This bought State Farm executives an invitation to a private party at the governor’s home in Los Angeles.
    According to a story in the Los Angeles Times, State Farm rarely makes such donations, but the company is presently lobbying Sacramento lawmakers on 10 bills, so this donation buys them access to lobby the governor and his staff on those bills. They will sit on the Governor’s Advisory Committee, enjoying four private meetings with Schwarzenegger.
     Also according to the Times, a letter from State Farm’s lawyer accompanied the donation and directed that the money be used to support the governor’s issues and legislative agenda, and nothing else.
    State Farm did cheap out a little. Their $25,000 only entitled them to cocktails at the Gov’s home; it would have cost $100,000 to actually break bread with the Gov and wife Maria at their home in early June.
    One issue that has caught State Farm’s eye is flood-damaged cars. The insurer opposes a law that would protect consumers from unknowingly buying a flood-damaged car. It opposes the bill that would prevent insurers from selling such cars to anyone other than a licensed dismantler. Currently, the insurer can sell such flood cars to auto auctions and presumably get a much better price than they would from a dismantler.
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