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McDonnell says he will return remaining donor's gifts

By Bob Lewis -- AP Political Writer

RICHMOND -- Gov. Bob McDonnell says he will return remaining gifts given to him and his family by a major campaign donor and businessman who lavished Virginia's first family with tens of thousands of dollars worth of items over the years.

McDonnell also said Tuesday in a live, sometimes contentious, hourlong interview on his monthly radio listener call-in show on Washington's WTOP radio that he repaid nearly $125,000 loans to Star Scientific chief executive Jonnie R. Williams Sr. using personal assets, loans and help from family members.

His daughter Jeanine McDonnell has already returned an unspecified gift Williams gave her for her May wedding, the governor said.

"It is my intent now to work with my counsel to ensure that all remaining gifts that we have are also returned," McDonnell said, calling it an attempt "to restore trust with the people of Virginia."

He continued defending the gifts, however, citing the letter of Virginia's ethics law, rated among the nation's weakest, and saying he didn't disclose the presents to family members because it wasn't legally required.

"Many questions have been asked about why I didn't do X, Y and Z. Well, because it's not the law," McDonnell said. "For instance, any gifts that are given to family members or spouses aren't reportable under current law."

The FBI is investigating whether McDonnell used the authority of his office to benefit Williams or Star Scientific, a troubled maker of nutritional supplements that is the subject of a federal securities investigation and several shareholder lawsuits. And Richmond's Commonwealth's Attorney, Mike Herring, is investigating whether McDonnell breached the state's financial disclosure law. McDonnell has hired a legal and public-relations team headed by former U.S. Attorney John Brownlee.

Among the gifts the governor received was $15,000 for another McDonnell daughter, Cailin, that she used to defray the catering bill for her 2011 Executive Mansion wedding reception.

Last week, McDonnell announced repayment of business loans Williams made to MoBo Real Estate Partners, which the governor owns jointly with his sister, totaling $70,000, and a personal loan to first lady Maureen McDonnell made in 2011.

"We have a couple of rental properties ... and there are cash-flow issues that come up every year. If anybody knows things about beach real estate, you don't rent from November through about April," he said, explaining the need for Williams' loans. "Sometimes we procure small loans, sometimes we put in owners' capital. That's just a regular part of any small business, so those loans were procured then."

After The Washington Post disclosed the loans on July 9, he said he decided to repay them.

He said the repayments are "all coming from our own assets. I didn't want to borrow money from anybody else. It's all our personal assets."

State officials are also investigating alleged irregularities in the mansion's kitchen during McDonnell's tenancy. Former chef, Todd Schneider, faces trial in October on four felony charges that he stole items from the kitchen. But Schneider contends in defense motions that members of McDonnell's family took state-purchased items from the pantry for personal use, and said he was told to take other state goods for himself as compensation for catering services.

The Republican governor offered tenuous support for yet-unspecified changes to ethics laws, and he expressed no appetite for convening a special General Assembly session in the final five months of his single, non-successive term to close loopholes in the financial disclosure law. Noting that the 2013 legislative session was the last of McDonnell's term, show co-host asked McDonnell why not lead the way, propose reforms and call lawmakers back to vote on them.

"It will be up to the lawmakers, really, to determine whether a special session (is) required. Typically, during an election year when they've got 90 days to go, they probably would not be that receptive to that," McDonnell said.

Legislators, including Republican House Speaker Bill Howell, have expressed support for ethics law reforms. Governors have discretion under the Virginia Constitution to call a special legislative session, although legislators are not required to enact legislation and can always move to adjourn. While all 100 House of Delegates seats are up for election in November, the next state Senate election isn't until 2015.

About two-thirds of the way through his talk show, McDonnell's irritation became clear over questions about the scandal that has driven his job-approval ratings from record highs of 61 percent two years ago to 46 percent earlier this month. Asked when he was questioned by the FBI, what he was asked and whether his wife was also interrogated, he cut off the question.

"We've spent 45 minutes of this show talking about this one issue, and I've been as candid and as honest as I can answering the questions that you've asked, and I really don't think at this point that I have much more that I can say about any of these things," he said.

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