Transportation Commissioner May Face Big Fine : Politics: San Diego businessman J. T. (Tom) Hawthorne’s ‘sources of income’ are being investigated by FPPC.

SACRAMENTO — The Fair Political Practices Commission is considering fining a California Transportation Commissioner more than $200,000 for alleged violations of state conflict of interest law, according to sources familiar with the investigation.

The six-figure fine being considered against Hawthorne could be one of the biggest ever put together by the political watchdog agency, and FPPC officials who are preparing the charges have yet to decide whether to impose the fine administratively or to file a rare civil lawsuit against the influential San Diego County Republican, the sources said.

The details of what the FPPC has found were not immediately available, but the sources said they pertain to “sources of income” that Hawthorne allegedly failed to disclose, as is required by the state Political Reform Act.

The matter will discussed in an executive session Tuesday with the five FPPC commissioners to determine how to proceed in the case, the sources said.

To handle delicate negotiations with the FPPC staff, Hawthorne recently hired San Francisco attorney Vigo G. (Chip) Nielsen Jr., an expert on political reform law. Nielsen’s office recently confirmed that Hawthorne was a client, but the attorney declined comment.

Hawthorne also did not return repeated telephone calls to his Kearny Mesa heavy equipment business and Escondido home over the past two weeks.

State law prohibits public officials from voting or influencing governmental decisions if it is “reasonably foreseeable” that their actions will have a financial effect on them personally or on their sources of income, such as business customers. In addition, state law requires officials to publicly disclose business arrangements, investments and other sources of income.

The investigation of Hawthorne, appointed by former Gov. George Deukmejian, began after a 1985 Los Angeles Times article that stated he voted for millions of dollars in highway construction projects later awarded to firms doing business with Hawthorne Equipment Co., the exclusive dealership in San Diego County for Caterpillar construction equipment, and Hawthorne Rent-It Service, an equipment rental firm.

In all, The Times found that, after he was appointed to the powerful nine-member commission in February, 1984, Hawthorne voted to spend $55.8 million in state funds for 39 San Diego highway and trolley construction projects. Of that amount, more than 90% went to customers of his heavy equipment business--including several that either bought or rented machines specifically for the state jobs.

At the time, Hawthorne defended the votes by saying his actions only authorized the San Diego work, not which company would eventually get the contract. Awarding the highway and trolley bids is up to the California Department of Transportation, he said.

He said in 1985 that it “crosses my mind” that the projects he’s voting on will yield more business for his firm. “There isn’t a competitive contract that goes out there for bids that we don’t anticipate that we, hopefully, are going to sell” some equipment for, he said.

In April, 1986, the FPPC issued a strongly worded letter warning Hawthorne that it would take legal action if he continued to vote on local transportation projects as a commissioner. It also disclosed that his votes detailed in The Times article constituted a conflict of interest.

Hawthorne promised not to vote on San Diego-related projects, but the FPPC investigation continued to examine how his previous actions affected his business, according to one of the sources.

In addition, the probe began looking at other sources of income that Hawthorne has allegedly refused to publicly report as required by law, a person familiar with the investigation said.

Part of that investigation has looked at whether Hawthorne owned real estate near 40th Street, where he was instrumental in persuading state and local officials to approve the completion of Interstate 15, according to one of the sources. It was not immediately known, however, if the FPPC had found a conflict of interest.

FPPC spokesman Jay Greenwood declined to discuss the Hawthorne case late Friday.

“As a matter of policy, it is inappropriate for me to comment on the case other than to confirm that the matter is under review,” he said.

However, Greenwood said the largest administrative fine ever levied by the FPPC was $138,000 imposed on April 25 against Louis Laramore, a Southern California developer, for laundering campaign contributions in connection with a Riverside County Board of Supervisors race. Laramore has also been charged by the Riverside County district attorney in a related criminal matter, Greenwood said.

The FPPC rarely files civil lawsuits, but did against former San Diego Mayor Roger Hedgecock in connection with allegations that his campaign received laundered contributions from onetime La Jolla investment broker J. David (Jerry) Dominelli, now serving a prison sentence for fraud.

Hedgecock was forced to resign after being convicted of related felony criminal charges, but those were reduced and dismissed last year. The FPPC civil suit against Hedgecock, now a radio talk show host, is still pending, however.