Acting Secretary of State Says Staff Repeatedly Told Fagan to Cancel La Mota Contract: “Our Advice Was Ignored”

“The secretary had predetermined she would take the contract from the moment she brought the issue to our attention.”

Shemia Fagan (Brian Brose)

Former Oregon Secretary of State Shemia Fagan ignored repeated advice that she not accept a contract with the founders of an embattled cannabis dispensary company that would ultimately lead to her resignation, says Fagan’s interim replacement, Cheryl Myers.

“Senior staff advised Secretary Fagan against working with La Mota from the very beginning,” acting Secretary of State Myers told WW on Friday. “We advised her against taking the contract, and when she recused herself, we advised her to disclose the relationship publicly. We again advised her to quit the contract when we learned about the company’s tax and legal troubles from the Willamette Week.

Myers added: “Unfortunately, the secretary never presented this as a question. The secretary had predetermined she would take the contract from the moment she brought the issue to our attention. Our advice was ignored.”

Fagan resigned May 2, less than a week after WW first reported she’d taken a lucrative consulting contract with a subsidiary of the cannabis chain La Mota, which has found itself in deep financial and legal trouble in recent years. The scandal was worsened by revelations that Fagan had helped shape an audit of the state agency that regulates cannabis to meet the wishes of La Mota co-founder Rosa Cazares, who holds more than 50 cannabis licenses with the Oregon Liquor and Cannabis Commission and alleged the agency was sexist and ageist and failed to support people of color.

Moreover, Cazares and her partner Aaron Mitchell were top Democratic donors and, in recent years, had contributed $45,000 to Fagan and $68,000 to Gov. Tina Kotek.

Notes jotted down by Myers of two meetings, obtained by WW through a public records request, show Myers brought up the La Mota contract twice: once in a Feb. 2 meeting with Fagan and another top official, and again in a March 24 meeting, just five days before WW published its initial story on La Mota. The notes don’t describe the content of those conversations, but Myers wrote in the March 24 meeting notes: “La Mota/WW upcoming story re tax lien status.”

Fagan told her staff in an internal email Feb. 15 that she would be recusing herself from the audit of the Oregon Liquor and Cannabis Commission, which at that point was already in its final form. But Fagan’s subordinates weren’t the only ones who knew of her contract. Last weekend, The Oregonian reported that Kotek knew of the contract a week prior to WW’s April 27 story that broke the news publicly.

Kotek confirmed to WW on Friday that when Fagan told her behind closed doors that she had signed a contract, Fagan also told her who the contract was with: La Mota’s co-founders, campaign donors to the top two elected officials in the state.

“Secretary Fagan said she had a consulting contract with La Mota and assured the governor that she had done everything appropriately,” says Kotek spokeswoman Elisabeth Shepard, “including asking for an ethics opinion to ensure she was allowed to do that work within ethical guidelines.” (Fagan had spoken to a staff member of the Oregon Government Ethics Commission over the phone about taking the contract, but records show she never asked for a formal written opinion, as is standard for elected officials looking to avoid any suspicions of impropriety.)

At a press conference shortly after the news of the contract broke, Kotek had many opportunities to say she knew about it a week before it became public. Kotek did not divulge her foreknowledge, however, and merely said she was “dismayed” by Fagan’s outside work.

Neither Fagan nor her attorney returned a request for comment on Myers’ statement.

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