Los Banos Mayor Tommy Jones violated the Political Reform Act when he failed to disclose three personal loans he took from one of the area's largest developers, Ranchwood Homes owner Greg Hostetler, a review of documents indicates.
Jones took the loans, totaling at least $13,500, in 2002 and 2003, public records show. He was between terms on the City Council at the time and repaid the loans by May 2004, six months before he was re-elected.
Even though the loans were paid off before he took office again, Jones was legally required to disclose them -- both when he declared his candidacy and when he took office. In both cases, he failed to do so.
Under the Political Reform Act, passed by voters in 1974, elected officials are required to disclose loans of more than $500 taken from private individuals within the past 12 months.
The loans from Hostetler, even though repaid, should have disqualified Jones from making decisions directly affecting Hostetler or Ranchwood for one year after he repaid them.
In at least one instance, Jones failed to recuse himself from a vote when, under state law, he should have. On Jan. 19, 2005, Jones voted in favor of allowing Ranchwood to submit an annexation application for the 15-acre Village Green subdivision. The item passed on a 3-2 vote.
The Fair Political Practices Commission can assess fines up to $5,000 per violation, FPPC spokesman Roman Porter said.
Porter said it's unclear what the violations could mean for previous decisions that Jones has made on Ranchwood projects. They probably won't disqualify him from participating in future Ranchwood votes, Porter said.
In interviews last week, Jones, 59, said he didn't know he was required to disclose the loans. "When it's all repaid, you think you're in the clear," he said.
The loans don't mean he has an improper relationship with Hostetler, he insisted.
"It was a high-interest loan. It wasn't a favor," Jones said. "When I took it, I was a private citizen and I never thought I'd run for council again."
Both Hostetler and Jones said they're not friends.
"I knew he had some issues and needed some help," Hostetler said.
Hostetler added that if he was "trying to pull something" he wouldn't have recorded liens creating public records that anyone could find.
"I would never make a loan to an in-office politician," he said. "At that point, he had lost an election. I thought he was out for good."
Since his re-election in 2004, Jones has participated in at least nine votes concerning Ranchwood projects. In most cases, he has voted in Ranchwood's favor. He also has been a proponent of a plan to annex 950 acres of Ranchwood's land into the city.
The Hostetler loans were recently revealed in the Badger Flats Gazette, a publication authored by Los Banos resident Gene Forte.
The city's attorney, Bill Vaughn, said the city is waiting for more information before taking a position on whether Jones should participate in future votes affecting Ranchwood, including the annexation.