Ethics Commissioner on Oregon’s Disgraced First Couple: “A Case Study in What You Are Not Supposed to Do in Public Office”

A long-delayed state investigation finds Cylvia Hayes and John Kitzhaber improperly benefited from influence peddling.

John Kitzhaber and Cylvia Hayes in 2014. (Adam Wickham)

It will be three years next month since former Gov. John Kitzhaber resigned.

Last week, a report from the Oregon Government Ethics Commission finally provided an official explanation of what went awry in Kitzhaber's third term and scuttled his fourth.

In a 154-page report, a commission investigator concluded that a "preponderance of evidence" indicated Kitzhaber's fiancee and policy adviser, then-first lady Cylvia Hayes, had committed 23 violations of state ethics laws.

"Ms. Hayes used her official position as first lady and policy adviser to the governor to obtain financial gain," wrote investigator Marie Scheffers in her report. Scheffers found that Hayes "used and knowingly allowed others to use her position as first lady and policy adviser to the governor's office and the access and influence she had in those positions to solicit and obtain funding."

The findings validate months of reporting by WW and other publications starting in 2014. And they undercut claims by Kitzhaber and Hayes that they were drummed out of public life by frenzied and sexist press coverage.

They also trace a tragic arc for the longest-serving governor in Oregon history.
Kitzhaber, 70, a Democrat, is one of the nation's leading thinkers on health care policy. In recent months, he's been easing back into public life, sharing his perspectives in speeches and writing on the challenges the Republicans' attack on the Affordable Care Act presents. On that topic and others, his decades of public policy expertise could be enormously valuable to Oregonians.

But as one ethics commissioner said last week, by his allowing Hayes, 50, to sell access to his office, Kitzhaber surrendered the moral high ground.

"It's a very clear case," said Commission Chairwoman Alison Kean, a Portland lawyer. "I think it's also a very clear case about the member of her household who also benefitted from her contracts—and that's the governor."

Attorneys for Hayes and Kitzhaber did not respond to requests for comment.

The ethics commission began its investigation in 2014, following a complaint from then-state Rep. Vicki Berger (R-Salem) based on a WW cover story ("First Lady Inc.," WW, Oct. 8, 2014).

But the ethics commission paused its investigation when the U.S. Department of Justice opened a criminal investigation in early 2015. The feds examined whether Hayes and Kitzhaber had sold access to his office though a lucrative fellowship and at least three private consulting contracts Hayes garnered while also serving as a policy adviser to the governor.

Last summer, U.S. Attorney for Oregon Billy Williams announced the federal investigation was over, and he wouldn't bring charges.

He offered no explanation of what investigators found in the more than two years since they blanketed Salem with subpoenas. Federal officials have also not responded to Freedom of Information Act requests for documents gathered in the investigation.

Kitzhaber and Hayes treated Williams' announcement as vindication.

"As I have said from the beginning," Kitzhaber said in a June statement, "I did not resign because I was guilty of any wrongdoing, but rather because the media frenzy around these questions kept me from being the effective leader I wanted and needed to be."

"I'm back," he added.

Hayes also blamed "unethical media bad actors," on Facebook. She amplified her remarks in a television interview with KATU in July 2017. "I had so much rage and so much hatred toward the handful of media who were so dishonest," she said.

That's not what the ethics commission concluded.

In a commission meeting last Friday in Salem, Scheffers noted that Kitzhaber told Hayes in an early 2011 email that he recognized her work could present conflicts of interest. But Kitzhaber never sought guidance from ethics officials.

"This was a purposeful refusal to engage with the ethics commission, probably because they didn't want to know what the answer would be," said Ethics Commissioner Nathan Sosa, a Hillsboro lawyer. "I think this is a case study in what you are not supposed to do in public office."

Commissioners voted to move forward with fining Hayes for 22 of the 23 violations Scheffers cited in her report. (They decided an allegation that she'd misused the Oregon State Police security detail fell into a gray area.)

It remains to be seen whether Hayes will contest the proposed fines of up to $110,000 and the possible forfeiture of her contract earnings, and how a pending ethics commission complaint against Kitzhaber will be resolved in February.

Kean asked commission staff to keep Kitzhaber's high position in mind when proposing how to dispose of his case.

"She wasn't elected. He was," Kean said. "My recommendation is that the governor be treated with a much higher standard."

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