When the North Pacific Coast Railroad was completed in October 1876, the village of Occidental quickly began to grow beside the tracks that ran through the valley. The narrow gauge railroad’s primary function was to haul local timber to distant markets, but it also served as a lifeline, bringing workers and tourists to the area. Occidental was officially designated a town on December 7, 1876 when the U.S. Post Office opened.

On May 10, 1879, Dutch Bill Howard sold Lot #6 to Amelia Jones. The Jones family built a two story structure on this site and soon resold the property and building back to Howard for $1,000. By August of 1880, Dutch Bill had leased out the first floor for use as a general store and the upper level became a Public Hall. Howard later sold the building to Giovanni Gobetti and his wife Giovanna in 1891 for $2,000 in gold. The Gobettis named their business the Union Saloon and operated it as a drinking and eating establishment for nearly 35 years. In 1925, Giovanna sold the Union Saloon to Carlo Panizzera for $2,500. Carlo renamed the building the Union Hotel and began a tradition that continues today.

Carlo Panizzera's life began in 1889 in the small northern Italian village of Brunia, near Lago di Como. In 1917, he immigrated to California where he first worked as a cowboy in the San Fernando Valley. Carlo never cared for the heat and rattlesnakes of Southern California and jumped at an opportunity to move north .

Carlo operated the Union Hotel as a boarding house and restaurant for stopover railroad passengers. One morning Mary Alberigi, his waitress, was carrying a load of linens from the hotel rooms upstairs down the steep, narrow stairway to the floor below. Under the load, Mary tripped and fell. Carlo found her, picked her up and carried her to the doctor. They were inseparable from that day on. The couple married on December 7, 1929 and on September 27, 1930, Mary Panizzera gave birth to their only child, Lucille.

Mary and Carlo's daughter Lucille grew up in the family business, playing in the Union Hotel's restaurant and saloon, as her parents worked. On November 6, 1949, she married Dan "Mahoney" Gonnella.

Dan and Lucille had five children: Michael, Mary Theresa, Mark, Daniel and Frank. Lucille’s father Carlo died on July 31, 1977, and her mother Mary followed two years later. Lucille and Mahoney Gonnella managed the growing business together until March 8, 1992, when husband Mahoney passed away.

Although the hotel rooms upstairs were closed when the railroad stopped operating in 1929, the Union Hotel had continued as a restaurant and saloon. Mary Pannizzera’s great home cooking had become legendary and more dining space was now needed. A new dining room opened on Carlo and Mary's 12th anniversary. The new addition connected the main building with the Bocce Ballroom, a large hall which had been framed with lumber from one redwood tree harvested from the Pannizzera’s ranch.

With this new construction, the old kitchen had become too small, so in 1958 a larger facility was completed. Other additions followed. The Union Motel was built in 1960 and on Memorial Day weekend 1984, the outdoor patio opened to diners. The year 1990 brought the addition of the Bakery/Cafe and the first Union Hotel Pizzeria began serving pizzas and pasta in 1992. In 1997, another Pizzeria opened in Santa Rosa, serving the same great Italian food at a second Sonoma County location.Today, Lucille Gonnella is a living link to the history of Occidental. Her children and their families continue the rich tradition of this famous dining establishment, where the past seems to be the present, living on in the authenticity of this old building. The restaurant still draws visitors from near and far, many of whom remember coming here as children. Little has changed and the history of the Union Hotel is rich with the stories of the many guests who have enjoyed its fine Italian cooking.