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Fees, Gifts of 2 Whittier Legislators Totaled Nearly $176,000 in 2 Years

September 01, 1988|MIKE WARD | Times Staff Writer

Two Whittier legislators whose offices were searched by the FBI last week in a political corruption investigation received nearly $176,000 in speech fees and gifts from private companies, trade associations and other groups and individuals in the last two years.

Democratic Sen. Joseph B. Montoya, chairman of the Senate Business and Professions Committee, accepted more than $80,000 in honorariums in 1986 and 1987. Most of the money was for speeches, but he also received $1,000 for touring a pharmaceutical plant.

In addition, he received $28,000 worth of gifts, ranging from a $7,000 tour of Europe paid for by companies in the waste incineration business to $750 worth of pest control work by a termite company.

Assemblyman Frank Hill, a Republican, received $41,725 for speeches and $26,208 in gifts.

Legislators are not required to disclose outside income until March 1 of the year after the income was received. The latest financial disclosure statements on file with the state Fair Political Practices Commission list income in 1987 and 1986.

However, Montoya has disclosed that he accepted an honorarium this year from Peach State Capitol Investments, a bogus company set up by the FBI as part of a sting operation designed to expose corruption. The San Gabriel Valley Tribune quoted Montoya as saying in a telephone interview that he had accepted a $3,000 honorarium from Peach State. Montoya would not confirm that figure to a Times reporter.

Montoya has denied any wrongdoing and has retained a Sacramento defense attorney to represent him.

Hill has refused to comment on the FBI investigation.

About 30 federal agents last week searched the offices of Montoya, Hill, Assembly Republican leader Pat Nolan of Glendale and Assemblywoman Gwen Moore (D-Los Angeles). The searches led to the disclosure that the FBI had been investigating corruption in Sacramento for two years and had set up two phony companies that reportedly made payments to legislators for their help in securing legislation. The sting operation was carried out with the undercover help of a legislative committee consultant, John Shahabian.

Shahabian's attorney, Donald Heller, told The Times last week that the fictitious companies gave legislators campaign contributions and paid fees for speeches that were never given. Heller called the speaking fees "a scam . . . a guise to give money to a legislator for personal use."

Most of the 15 state legislators in the San Gabriel Valley area report some income from speech-making every year, but the amounts seldom exceed $5,000.

"Both of them (Montoya and Hill) are on the high side, especially for legislators who are not in the leadership," said Walter Zelman, executive director of California Common Cause, the citizen's lobby. "Montoya's numbers are staggering. . . . He is one of the greatest abusers of the honoraria privilege."

"The real concern with honoraria is that it is cash in the pocket," Zelman said. "It is potentially more influential and corruptive . . . than campaign contributions which have to be accounted for."

Nolan picked up $22,850 for speeches, and $44,973 in gifts, including trips abroad, in the last two years. Aside from Montoya, Hill and Nolan, only Sen. William Campbell (R-Hacienda Heights), who has a reputation as an entertaining and witty speaker, and Sen. Art Torres (D-Los Angeles), who is chairman of the Senate Toxics and Public Safety Management Committee, earn large sums from speaking engagements. Campbell received $45,000 and Torres more than $28,000 for speeches in the past two years.

Montoya has vigorously defended his acceptance of honorariums even though the payments are often made by companies or trade groups with a keen interest in legislation before Montoya's committee.

In a 1985 interview, Montoya said he gave paid speeches because he is "not a lawyer, and I don't have an insurance company on the side. All I do is legislative stuff, and I find it (honorariums) an attractive supplemental income which I would not turn down in any circumstance."

Montoya has conceded that he is not a particularly good speaker, but says he receives many invitations because of his knowledge and his sympathetic attitude toward business.

"I may not be as witty as Bill Campbell or as intelligent as Willie Brown but I am more relevant" on the issues he is invited to discuss, Montoya said in a 1987 interview.

Last year, Montoya received fees ranging from $250 for speaking at a breakfast of the Sacramento chapter of the Internation Assn. for Financial Planning to $2,500 for speaking at a dinner for Mediscript Inc., a Chatsworth pharmaceutical company. He later received an additional $1,000 from the drug company for touring its plant.

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