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Friday, December 9, 2016

By Maria L. La Ganga and Nigel Duara, Los Angeles Times (TNS)

SALEM, Ore. — Rumors swirled for years, prosecution documents piled up, but each time a whiff of impropriety surfaced, Cylvia Hayes, fiancee of Governor John Kitzhaber, managed to distance herself.

Her first brush with a state investigation was in 2010, when the Oregon attorney general’s office began tracking her relationship to a state Department of Energy bid.

For months, concerns over what John Kitzhaber has called the “gray area” between his Hayes’ private and professional lives haunted the longtime politician — through his 2010 election, his third term in office, his historic bid for a fourth term and the weeks since his January inauguration.

Kitzhaber’s problems came to a head Friday when he resigned, effective Feb. 18. His decision came after a week of political drama, which Secretary of State Kate Brown called “bizarre and unprecedented” and which has absorbed this normally quiet capital.

Under the state constitution, Brown will become Oregon’s 37th governor. When she takes the oath of office, she will be the nation’s first openly bisexual chief executive. Like Kitzhaber, she is a Democrat.

With journalists packed into the anteroom of his office Friday waiting for the governor to appear, Kitzhaber announced his resignation just after noon via an emailed news release. The document was posted on his official website, along with an audio file of the governor reading the announcement aloud.

“I understand that I have become a liability to the very institutions and policies to which I have dedicated my career and, indeed, my entire adult life,” said Kitzhaber, 67, who has not been seen in public since Wednesday. “As a former presiding officer (of the state Senate), I fully understand the reasons for which I have been asked to resign.”

The state Government Ethics Commission is investigating whether Hayes falsified tax forms and was paid consulting fees to influence her future husband, and just what Kitzhaber’s involvement may have been. On Monday, the state attorney general announced she had begun a criminal investigation into the troubled couple.

The latest chapter in the Kitzhaber-Hayes saga began in October, when Willamette Week, a Portland alternative newspaper, rolled out the first of two reports documenting the degree and scope of Hayes’ influence in the governor’s office and the rewards her efforts have paid to her private contracting business.

It was less than a month before election day, and Kitzhaber’s supporters derided the report as an October surprise meant to knock the governor off his stride. Kitzhaber won re-election easily. Months passed and it seemed that once again, Hayes had found a way to sidestep trouble.

But by late January, the governor’s office finally responded to public records requests from the media, and the products of those requests threatened to bring Hayes down — and her fiance along with her.

There were details about Hayes’ alleged efforts to steer jobs to friendly firms, her liberal use of the governor’s office to schedule private meetings, her dual roles as the governor’s energy adviser and a professional clean-energy advocate.

Hayes had grown up poor in rural Washington state, in a household that sometimes didn’t have running water. After winning an academic and athletic scholarship to the state’s Evergreen State College, she fashioned a career as an energy consultant in Bend, Ore.

Along the way, she took detours, including a fraudulent green-card marriage to an 18-year-old Ethiopian when she was 29, a deal that netted her $5,000 and allowed the young man to remain in the U.S.

And then there was the pot farm.

In 1997, Hayes and a boyfriend bought a 60-acre parcel of land in Washington state that was intended to be used to grow marijuana. She said in response that she had been in an abusive relationship with a “dangerous man,” and had no role in the proposed operation.

But Hayes’ youthful “serious mistakes,” as she described them, didn’t do much to rattle Oregon voters. It was her more recent past that elicited concern.

After a failed run for the state House of Representatives, she sought Kitzhaber’s advice in 2002, the final year of his second term. He divorced in 2003, and the two began dating. Hayes’ firm in Bend, 3E Strategies, began to win contracts for energy and environmental work in the state.

Kitzhaber, who first served as governor from 1995 to 2003, announced in 2010 that he would again seek the office. But even before he was elected to a third term, Kitzhaber’s girlfriend presented political difficulties.

Assuming Kitzhaber would win an easy victory in 2010, state Department of Energy staffers allegedly helped steer a contract to Hayes’ firm, according to investigative documents reviewed by the Oregonian newspaper in 2011. The bid was for a federal stimulus grant that would help Oregon ready its energy resources for major emergencies.

Although her company did not win the contract, Hayes still got a $60,000 chunk of the $200,000 grant. It happened, according to internal emails released as part of the investigation, because R.W. Beck, the Seattle firm that won the bid and wanted future work in Oregon, sought to placate Hayes and the presumptive future Oregon governor.

Kitzhaber and Hayes became engaged last August. Two months later, the Willamette Week bombshell dropped. The ethics commission launched its investigation.

On Jan. 30, the governor held a testy news conference, “acknowledging the legitimacy of some of these questions” but arguing that he and Hayes had done nothing wrong.

On Tuesday, Kitzhaber sat down with Peter Courtney, president of the state Senate and a longtime friend and colleague, and said he planned to step down. He also called Brown, who was in Washington, D.C., for a conference, and summoned her back to Oregon for an emergency private meeting.

On Wednesday, Brown hopped on a plane. But when she was escorted into the governor’s office, Kitzhaber asked her why she was there. He later announced, emphatically and for the third time in less than two weeks, that he had no plans to resign.

Courtney and Tina Kotek, speaker of the state House, met with the governor Thursday morning and demanded his resignation.

A day later, the governor resigned.
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La Ganga reported from Salem and Duara from Tucson.

Photo: Oregon Governor John Kitzhaber speaks at the American Health Insurance Plans convention on June 4, 2009 in San Diego, Calif. On Friday, Feb. 13, 2015 Kitzhaber announced his resignation as governor of Oregon. (John Gibbins/U-T San Diego/Zuma Press/TNS)