The state of Oregon and John Kitzhaber could really use a hard-fought governor's race. 

The third-term governor appears headed for re-election to a historic fourth stretch in office. He's been comfortably ahead in political polls, faces only token opposition in the primary and enjoys a strong edge in statewide Democratic Party registration.

His probable opponent in the fall, Rep. Dennis Richardson (R-Central Point), has yet to show he can muster the money and momentum to take on Kitzhaber.

And that's too bad. The governor has a lot to explain and answer for this year.

Kitzhaber, 67, served as governor from 1995 to 2003, sat out seven years, and ran again in 2010, winning a narrow victory over Republican Chris Dudley. He has had one major accomplishment: a restructuring of the PERS system that will save billions of dollars. He also muscled through what looked like major reforms of the state's education and health-care systems.

It's too soon to know if his health-care changes—primarily, the creation of community-care organizations to manage health-care money and services on a local basis—will pay off. The same is true with the creation of the Oregon Education Investment Board to oversee the state school system from kindergarten through college.

In the last part of this term, much of his agenda has frayed—and in some ways cratered. The $248 million spent on software development for the health-care exchange known as Cover Oregon? It's a fiasco on a historic scale. The system is in ruins, the state is switching over to use the feds' website, and (according to reports by KATU and The Oregonian) the FBI is investigating the mess.

Yet Kitzhaber, who sat down with us for an interview last week, appears almost in denial about the past 12 months. 

While he acknowledges the screwup at Cover Oregon, he says that money was not wasted

He says the hiring of Rudy Crew to oversee Oregon's education reform was not a mistake, even though Crew (pulling down $280,000 a year) barely worked, washed out after 11 months and used his Oregon position as a jumping-off point for paid speeches and his next lucrative job.

The Columbia River Crossing? The $2.8 billion bridge project-—Kitzhaber's baby-—collapsed after Washington state refused to help finance it and Kitzhaber's plan to have Oregon go it alone in building it failed to win his party's support. Kitzhaber says he'd back it again if Washington came up with the money.

A tough primary opponent might hold Kitzhaber accountable for problems the governor seems hardly to think are problems at all.

What follows is our interview with Kitzhaber, edited for clarity and brevity. See video excerpts about Cover Oregon here

WW: Why do you want a fourth term? What remains unfinished?

Kitzhaber: I think the answer to that question is, we need to remember where we were three years ago. We were totally polarized, we had double-digit unemployment across the state, a divided Legislature, high unemployment and a pretty uncertain future.

We were able to build up what I would call an operational political center. We erased the deficit. We were able to make some changes in education, health care, public safety, workforce—and all of those have local delivery mechanisms. They are pretty fragile. I'm interested in making sure we keep those going long enough to take root and really deliver on their promise.

You also talked in the middle of this term about Oregon's tax structure.

Yep, that is front and center. We had a business labor coalition that we built from the ashes of [Measures] 66 and 67 [that raised taxes on business and the wealthy in 2010]. They have done some polling—a much deeper dive than we've ever done in the past. A target date would be no later than general election 2016.

Do you think Cover Oregon has pushed back your ability to take on tax reform?

I don't think so.

No? What is then the significance of Cover Oregon

Cover Oregon reflected two things. It reflected a project management failure, which I have to be accountable for. It happened on my watch. I think we had some subpar technology, but I would not accept that this was a policy failure. We have—notwithstanding the problems with technology and management—enrolled 240,000 people through the exchange and a total of 370,000 people, which is, on a per-capita basis, as well as any state.

You may get re-elected, but to what degree do you think this $248 million mess has hurt your credibility?

It's a fair question. To question the premise that we have wasted $240 million: We have enrolled a quarter of a million people, and some of those resources went to do that. The Medicaid enrollment engine is working, and that part of the technology is going to be salvageable.

Obviously, I am running for re-election and I intend to take on tax reform. Credibility is going to be very important.

I believe that if you look at my overall performance over the last three years, we have been able to do some pretty remarkable things, and I think we have delivered on almost all of the promises we made on the front end.

So you say the premise of the question was wrong that $248 million was wasted?

Yes, the balance sheet doesn't look that bad and the outcome looks really good.

You spent a lot of time on K-12 education in your first legislative session and the setup of the Oregon Education Investment Board. If you were talking to parents, how would you say students are better off because of the things you've done?

I would say it's an iterative process. We are going to have a metric for kindergarten readiness and third-grade reading, which are the two most important places that move the dial. We haven't quite seen those investments yet, but I think in the next two to three years you are going to be able to see tangible outcomes of those investments. 

We did add over $1 billion to increase the K-12 budget by 16 percent, which is having tangible effects right now in terms of class size and hiring of teachers.

We just had a teacher strike in Medford and almost had one in Portland. When you ran in 2010, you talked about statewide bargaining for teachers. Where do you stand now?

I am in the same place. I mentioned it at the [Oregon Education Association] convention, and it didn't have a happy outcome.

They booed you, didn't they?

There was a little booing going on. I didn't see any ropes, but it felt like I was back home here in Douglas County.

With the state basically paying 70 percent of the [school] cost, you get 197 bargaining units that are bargained in a vacuum with no relationship to what the size of the state school [budget] is going to be. I understand why there is opposition to that. There are other ways to do it.

But I can tell you, if we don't address that, we will never be able to fund the quality-education model. Personnel costs are determined by local bargaining, which is as it should be, but there ought to be some relationship between what [teachers] are bargaining for and the money that is actually available.

We saw the Columbia River Crossing come to a halt in February. The underlying problems of congestion and safety are still there. Do you have any plans to attack those parts of the problem piecemeal?

The short answer is no. The problem remains, which is why I supported the CRC for all of those reasons you mentioned. I'm not going to re-engage in a conversation about the CRC until the state of Washington shows up with a check in their hand.

When you ran for governor in 2010, you said success as governor, No. 1 or 2 on the list, was completion of the Columbia River Crossing. If we revisit that, is your term less than a complete success?

Absolutely not. We did our part. We delivered on our side of the handshake. It was a bi-state project. We don't have control over the state of Washington, but we delivered and kept the money in the queue. We delivered the bridge permit. We did the litigation and all of the legal issues, and we had the money, so no. It's unfortunate that Washington didn't step up, but there is absolutely nothing else we could have done. We brought it right up to the edge, and we didn't find another hand.

The criticism of your first eight years as governor was that you were great at coming up with ideas and not as good at implementing them. Was that a fair criticism?

It was absolutely fair. In my first two terms, I think the single biggest mistake I made was, I approached it as a sort of super legislator. But the role of the executive branch is to set the agenda and to essentially build support inside and outside the building for that agenda. That was a hard lesson learned.

So do you think that could happen again?

I don't worry about it. It is certainly a possibility, but you've got to walk before you can run. And we had an utterly siloed system of education with really no clear system of accountability, and a health-care system designed on rewarding volume regardless of whether there were outcomes. That is one of the reasons I want to run this last time, because I think you're absolutely right, the proof is going to be in the pudding. 

Rudy Crew—was that a mistake?

I don't think it was a mistake. It would have been a mistake if we let the problems with Rudy Crew derail our policy agenda. He brought a lot to the table. It became clear that this guy, while he was brilliant and a motivator, he was not a very good implementer, so we sent him on his way. In retrospect, it would have been better to hire someone else, but I wouldn't say it was a mistake.

We've asked every candidate who's come through here this question: If you could be one person—dead or alive, other than yourself—who would it be?

I'm actually happy with being myself. I've got work, I've got problems, but I've had a blessed life and I wouldn't change my shoes for anybody.