THE HILL WILLIAMS SAGA : Puzzling Investment Venture Led to O.C. Developer’s Downfall : Firm Donated to Campaigns Before Filing for Bankruptcy

During the three years before Hill Williams Development Corp. filed for liquidation in U.S. Bankruptcy Court, the Anaheim-based company and its executives contributed nearly $55,000 to political candidates, including former President George Bush and several Anaheim City Council members.

Of that total, $35,000--including a $15,000 donation to Bush--was made during a single week in March, 1992.

Those contributions came at a time when Hill Williams was experiencing severe cash-flow problems, according to the state Department of Corporations. In a civil lawsuit filed earlier this month, the state alleges that Hill Williams defrauded investors by illegally using investor funds improperly. The lawsuit doesn’t mention political contributions, but state investigators do allege that the company lacked sufficient operating income to pay its obligations since December, 1990, if not earlier.

Despite the contributions, Hill Williams founder and Chairman Don Williams, who described himself to associates as a staunch Republican, wasn’t well known in local GOP circles. “The (Williams) name doesn’t ring a bell,” said Orange County Republican Party Chairman Thomas A. Fuentes.

Williams’ single largest political contribution, according to Federal Election Commission records, was last year’s $15,000 contribution to the national Republican Party. In return, Williams received 10 tickets to the President’s Dinner, a Washington gala that was billed as the largest political fund-raiser in U.S. history.

Williams himself didn’t attend the dinner, said William D. Ehrle, a former Anaheim city councilman who for about a year was Hill Williams’ public affairs director.

Ehrle and a number of other Hill Williams executives did travel to Washington for the gala. While there, Ehrle said, the group met with a number of federal officials and congressmen.

During March, 1992, Hill Williams also donated $20,000 to the national GOP for use by House and Senate candidates.

Before those high-profile donations, Hill Williams’ political contributions were closer to home, local and state records show. During 1990 and 1991, for example, Hill Williams contributed $3,500 to Gov. Pete Wilson. And, between 1986 and 1992, Hill Williams and its executives gave $19,900 to Anaheim City Council candidates. The contributions were spread among a number of candidates--including Ehrle, who received $4,350.

Ehrle denied that the donations were improper because Hill Williams had relatively little business before Anaheim’s council. On the handful of occasions when Hill Williams did go before the council, Ehrle said, he abstained from voting.

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