Your Toyota Camry should have two marks which will indicate whether the engine ignition timing is correct. One mark should be located on or near the timing belt cover. The second on the crankshaft pulley.
During your 1989 Toyota Camry's smog inspection the technician was probably unable to locate one or the other mark, and thus unable to determine whether your Toyota Camry had the correct ignition timing.
You will need to find these timing marks. The one on the pulley usually gets very dirty and unable to see. This is a simple fix; just use some engine cleaning detergent and a brush to clean the dirty off the crankshaft pulley and you'll be fine. The second mark (either on the timing belt cover or engine block) can probably use a cleaning too. You basically want to make sure you see two marks. The technician will use a tool called a timing gun during the smog check to watch that these two marks meet up properly while your engine is running.
