The head of a property holding company gave Gov. Gray Davis' campaign $100,000 last year just as pressure mounted for the Department of Health Services to intervene in the closure of a Vallejo nursing home that the company controlled.

Although the health department ultimately cited Sereno Care Center for 20 violations involving patient transfers, advocates and attorneys said the department could have easily done more, acted sooner and possibly saved the lives of at least two patients who died, allegedly of complications from "transfer trauma. "

Now, those same advocates and attorneys question the timing and influence of the campaign contribution as the nursing home closed. One of the state's top campaign finance experts, Bob Stern, said Thursday, "Businesses make contributions for business purposes.

"I'm sure they considered it a good investment," said Stern, president of the Center for Governmental Studies in Los Angeles and the California Fair Political Practices Commission's former general counsel. He said, "$100,000 is a big, big contribution. It opens somebody's eyes. "

Both the contributor, Martin Harmon, and health department officials denied any link between the department's actions and the contribution.

Davis spokesman Steve Maviglio said the contribution carried no bearing on the health department's activities. "We don't do business that way," he said.

Davis has come under repeated fire for what critics allege is "pay-to-play" government as he has raised roughly $50 million in his battle for re-election.

The Sereno controversy began July 16, 2001, when residents received notice that the 99-bed home would close the next month.

The next evening, five patients transferred as their families acted quickly to find them beds elsewhere. But state records show that from the start of the closure process that day, Sereno's staff failed to make medical assessments of the patients as state law required.

Advocates and attorneys also say the home failed to provide the patients with required counseling to ease potential transfer trauma and forced family members to make hasty moving decisions.

On July 18, 2001, the state's leading patient advocate, Pat McGinnis, executive director of California Advocates for Nursing Home Reform, called the health department and, as she later described in a letter, "begged" its officials to stop any more transfers. Five more patients left the facility that day.

The department responded by starting daily monitoring visits to Sereno, but didn't heed McGinnis' request to stop transfers as it did when Doctors Medical Center in Pinole closed a nursing home there in 1999.

In that case, the department issued an order that stopped transfers for five days so it could ensure laws were followed.

Kathyrn Stebner, a San Francisco lawyer, asked the state for the same action in writing July 19, 2001, and also sent a four-page letter to Sereno Care officials, outlining what she said were the proper closure procedures they weren't following.

The next day, a sultry Friday, union workers, family members and advocates including McGinnis and Stebner staged a noisy protest outside the nursing home.

A health department monitor watched through windows with the home's administrative staff.

State records show that at least one patient was transferred that day. Identified only as "patient 10," the records say she didn't receive a medical evaluation, even though the health department investigator had been on site for three days.

On July 22, 2001, McGinnis sent a scathing letter to Brenda Klutz, the department's official in charge of nursing homes. "The responsibility for these residents and the adverse health consequences they will suffer as a result of these illegal transfers lie squarely on the shoulders of (the department)," she wrote.

McGinnis again asked for the department to stop the transfers. It didn't.

Still, the closure wasn't proceeding quietly. Horizon West, a Rocklin-based chain that had run into trouble with the federal government, owned Sereno Care. In 1999 Horizon paid the federal government $4 million to settle a Medicaid fraud claim that included allegations that its president bought shoes at Saks Fifth Avenue and expensive wine with taxpayer money.

Shortly after settling the claim, the president, Ellen Kuykendall, and Martin Harmon, the head of the holding company that owned nursing home buildings and leased them to Horizon -- including Sereno Care Center -- accompanied Gov. Gray Davis on a trade mission to Europe.

Nursing home advocates decried Davis for including them on the trip given Horizon West's Medicaid settlement. But the issue died quickly.

Then on July 24, 2001, as McGinnis and others continued to charge that Horizon West was closing Sereno Care Center in violation of patients' rights, Harmon wrote Davis' campaign committee a check for $100,000.

The next day, the health department notified Sereno Care that it would be fined for violating the rights of 20 patients transferred without medical assessments. But the department stopped there.

McGinnis and Stebner said it is clear that more than 20 patients were transferred without assessments and that the health department could have done far more.

Stebner, who represents about 70 former patients and their families in a class-action suit against Sereno, said Thursday that based on interviews she did with five former employees involved "in giving direct care to patients" that "no medical assessments for transfer trauma were ever completed" involving any patients.

Stebner's lawsuit alleges that two patients died from complications of transfer trauma. Stella Green died Nov. 5, 2001, and Helen Brownell died Jan. 7, 2002, according to the lawsuit.

The deaths occurred months after Sereno closed its doors. On Aug. 17, 2001, it had notified the health department that it intended to seek a suspension of its license so the facility's next tenant could take it over and reopen quickly, without obtaining a new license.

Sereno Care officials said their landlord -- Harmon -- was negotiating with Kaiser Health to rent the building. Harmon this week said he still doesn't have a tenant and has stopped renovations of the facility.

He called the timing of the contribution to Davis "a coincidence. " His political action committee gave no more than $5,000 to any other candidate in 2001.

"The Democrats were pushing to raise a lot of money for" Davis, Harmon said, adding that he's been Davis' friend for more than 25 years. "In terms of Monday morning quarterbacking would I do it again? No. "

Klutz strongly denied Thursday that the department did anything improper. She also said it received no communication from the governor's office involving Harmon or the nursing home.

She said there was no legal basis to stop the transfers at the time, despite advocates' demands.

The fact that the patients left the facility was "not illegal," Klutz said. "What was illegal, and the reason we issued citations, was that the facility failed to assess the patients before they transferred. But we cannot stop family members from taking (patients) out of the facility," Klutz said.

She rejected McGinnis' argument comparing the case to Doctors Medical Center and said the department did force Sereno to conduct medical assessments. If it didn't, she said, then the department could issue a cease-and-desist order to stop transfers.

Still, patient advocates insisted the health department could have done more and that Harmon's contribution appears to be far more than a coincidence.

Carole Herman of the Sacramento-based Foundation Aiding the Elderly has observed and sometimes sued Horizon West's nursing homes for years. She said she would be surprised "only if (Harmon) wasn't trying to influence the administration. I think it stinks. He has a lot of clout. "

McGinnis, an attorney, remained adamant this week that the health department mishandled Sereno's closure. "The state refused to do anything. We weren't saying they had to keep it open.

"I just don't get it. When you're in a situation like this and a state agency doesn't do anything, you have to wonder. "