PORTLAND, Ore. (KOIN) – Expense records released by the Oregon Secretary of State’s Office are raising new ethical and legal questions surrounding former Secretary of State Shemia Fagan.
Fagan, who came under intense scrutiny this spring after her ties to a cannabis company raised ethics concerns and led to her eventual resignation, spent taxpayer and campaign money on personal travel expenses for her family, according to documents released on Friday by the Secretary of State’s Office.
The documents, which were first reported by The Oregonian/OregonLive, show Fagan used thousands of dollars in taxpayer funds on expenses such as pet fees, airplane tickets for her kids and stays in multiple four-star hotels outside of Oregon.
Documents included hotel and car rental expenses connected to various trips in 2022, including the southern Oregon Coast.
In a statement to KOIN 6 News, Secretary of State spokesperson Ben Morris said, “Policy allows travel with families on overnight stays; however, additional costs above single occupancy are the responsibility of the employee if for personal use and not a business reason. The Secretary was advised by staff that permitting family members to ride in a state-paid rental vehicle was prohibited by the agency’s travel policy.”
In September 2022, a revenue accountant emailed Fagan’s executive assistant about how to separate personal use from state business in a rental car charge. The accountant’s email said, in part, “state employees cannot benefit from state contracts. So in this case, this vehicle was rented for state business and then kept for personal use which is an ethical violation in a couple of different ways.”
Before Fagan resigned, she said her salary was not enough to provide for her family. She made $77,000 per year.
Meanwhile, online transaction records on the state Secretary of State website show that in April 2023, Fagan pulled $20,149.96 from her campaign as “Reimbursement for Personal Expenditures” with it addressed to “Candidate & Immediate Family.” According to Oregon’s campaign finance rules, candidates are allowed to use campaign funds after they win an election, so long as the money goes toward their duties. However, personal use of these funds is prohibited.
Republican consultant and former state representative Julie Parrish told KOIN 6 that because the agency is in charge of audits and accountability, the newly released expense reports are especially damaging for public trust.
“There are some standards there in terms of trying to make sure that you are interpreting the rule, the law, and professional ethics,” Parrish said. “And you’re also the person at the Secretary of State who’s in charge of campaign finance. So, what example are you setting?”
Parrish said that ethics are especially important in Fagan’s former position.
“That agency more than anything, is the one that you have to be at the top of your game in ethics, accountability, and transparency, and making sure that it functions just because of the type of work that the secretary of state’s office is tasked and charged to do, and she failed,” Parrish said.
In a statement to KOIN 6 News, acting Secretary of State Cheryl Myers said: “Secretary Fagan’s frequent travel with family members was not appropriate for an elected official in her position. Staff at the agency frequently pushed back on the plans for these trips, but their advice was ignored … The agency provided to and informed the Secretary of all the relevant rules and followed our travel policy when arranging trips. Our general travel policy states that travel should be limited, necessary and conducted in the most efficient and cost-effective manner. This represents how staff advised Secretary Fagan when she was making decisions about travel. However, elected officials have wide latitude to decide what events they will attend and who they travel with if their non-staff travel companions pay their own way.”
On Monday, May 8, Shemia Fagan officially resigned after raising ethical concerns sparked by her paid consulting contract for Veride Holding LLC – an affiliate of the cannabis company La Mota — while her office was auditing the Oregon Liquor and Cannabis Commission.
On Wednesday, OLCC spokesperson Mark Pettinger confirmed to KOIN 6 News that federal investigators recently requested records related to Fagan and La Mota, as well as the company’s owners Aaron Mitchell and Rosa Cazares.
Still, with the growing controversy following her resignation, Parrish says the state should not wait for a complaint to fully investigate Fagan’s finances – including her campaign funds.
“The fact that Shemia Fagan wrote herself, right before all of this happened, a $20,000 reimbursement in one fell check is eye popping,” Parrish said. “The fact that she had accumulated $20,000 of largely miscellaneous contributions that are outside of the public purview is really problematic, given that she’s not she was not in a campaign cycle.”
Stay with KOIN 6 as this story develops.
