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Hotelier Stands Politically Corrected

New to the game, an Orange hotelier illegally reimbursed employees for $8,000 donated to candidates in three O.C. cities. His fine: $68,000.

October 15, 2005|Jean O. Pasco | Times Staff Writer

His first experience in local politics was a costly one for Orange County hotelier Terry Tognazzini.

The expensive part was not the $8,229 in campaign contributions made in 2002 to city council candidates in Santa Ana, Anaheim and Garden Grove; it was the way in which most of that money was given.

This week, the Fair Political Practices Commission fined Tognazzini $68,000 for illegally reimbursing his employees and an employee's spouse for donations made on his behalf to candidates -- both Republicans and Democrats.

State law bars campaign donors from shielding the source of their donations.

"Making a contribution in another person's name is one of the most serious types of violations because it denies the voter of public information about the true source of a candidate's financial support," said a report on the violations prepared for this week's commission meeting in Sacramento, where the fine was accepted.

Tognazzini's attorney said his client didn't know he was violating the law.

"My client's view was that this was an entirely innocent mistake," attorney John A. Ramirez said of Tognazzini and his company, RR Tog, which operates Red Roof Inns in six Southern California cities. "It was his first foray into politics."

Tognazzini, who lives in Orange, got a break from commissioners. While the maximum fine typically is imposed for money laundering, his penalty was reduced from $90,000 because he cooperated with investigators -- even voluntarily surrendering evidence of additional illegal reimbursements.

Commission investigators said Tognazzini, 69, paid back five employees and one employee's spouse for contributions, including $2,000 to Anaheim Mayor Curt Pringle, $1,000 to Garden Grove Councilman Mark Leyes, and a series of $249 contributions to Santa Ana council members Alberta Christy, Lisa Bist, Mike Garcia and Jose Solorio.

Christy and Bist, who ran for reelection in 2002, each received $1,494 in six contributions. First-time candidate Garcia received $498 in two contributions and Solorio, elected in 2000, got $249.

Finally, Tognazzini and his wife, Patricia, also gave Christy, Bist and Garcia an additional $249 each from personal funds that weren't reimbursed by the business. Those donations were deemed proper.

All of the donations were made in October 2002, before the cities' elections.

The idea to get involved in politics came from Tognazzini's top managers at Red Roof Inns, who thought their boss should be supporting local pro-business candidates, the commission report said. His vice president of management for Red Roof Inns Southern California selected the candidates and the amounts to be given.

The vice president then asked longtime employees to make contributions, telling them they would be reimbursed, the report said. The company controller provided the employees with a business reimbursement claim form to get their money back.

The employees told investigators they had no idea that what they were doing was illegal.

Besides running afoul of state law, the donations to Christy and Bist violated Santa Ana's campaign contribution ordinance, which limits donations to $1,000 per candidate per election. The ordinance also forbids any member of the council who has received excess contributions from voting on matters involving the donor.

State investigators said there was no evidence that Tognazzini had business pending in Santa Ana when the contributions were made.

The amount of the fine is likely to have a chilling effect on other business owners considering their first leap into politics, said Ramirez.

"Unfortunately," he added, "this experience has so soured Mr. Tognazzini, the likelihood of him contributing to any other candidate is zero."

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