In December 2011, Coto announced that he would run for California State Senate to represent District 15, which includes the cities of Campbell, Cupertino, Los Gatos, Monte Sereno, Saratoga, and San Jose. Coto's campaign focused on improving education to create a competitive workforce, balancing the budget, and solving the issue of income inequality. He was defeated by Jim Beall by a 13% margin in the November 2012 election. The California Fair Political Practices Commission issued a $6,000 fine for exceeding contribution limits and failing to disclose more than $117,000 in expenditures during his State Senate run.