Oregon Secretary of State Shemia Fagan announced Monday issued an apology after it was revealed last week she took a consulting job with a marijuana firm. Fagan also announced she is terminating that contract with Veriede Holdings, while also saying she did nothing wrong.
The matter came to a head Friday after Fagan’s office released an audit of the state’s marijuana regulators, the Oregon Liquor and Cannabis Commission. The audit called for the OLCC to “reform” some rules for marijuana businesses, saying they are “burdens” when combined with federal restrictions on interstate commerce, banking and taxation.
Fagan, a Democrat, recused herself from the audit because she is a paid consultant of an affiliate of marijuana retail chain La Mota, her office said. La Mota’s co-owner has hosted fundraisers for top Democratic Oregon politicians, including Fagan, while the co-owner, her partner and their business allegedly owe $1.7 million in unpaid bills and more in state and federal taxes, according to Willamette Week, a Portland newspaper.
“I owe the people of Oregon an apology,” Fagan said in her statement Monday. “I exercised poor judgment by contracting with a company that is owned by my significant political donors and is regulated by an agency that was under audit by my Audits Division. I am sorry for harming the trust that I’ve worked so hard to build with you over the last few years, and I will spend the next two years working hard to rebuild it.
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Fagan said she worked at Willamette University Law School teaching a class and with Veriede Holding on the cannabis industry outside of Oregon. Fagan claims she did not violate Oregon ethics rules and laws and says she believes a review by the Oregon Government Ethics Commission will confirm that. In an effort to make her point, Fagan released a copy of the signed contract. You can read that at the bottom of this article.
“I am also eager for the Department of Justice’s review of the OLCC audit because the review will verify that hard-working auditors in the Oregon Audits Division conducted their work with independence and integrity, Fagan wrote.
While she says she did nothing wrong, she is still apologizing.
“I broke your trust. That was wrong. I am truly sorry,” Fagan said.
Republican leaders, including Oregon Senate Minority Leader Tim Knopp of Bend and House Minority Leader Vikki Breese-Iverson of Prineville, called for Fagan on Friday to resign over the consulting job.
“This appears to be an ethics violation and if it isn’t then Oregon’s ethics laws are broken,” read their join statement.
Gov. Tina Kotek, a Democrat, indicated she had concerns later on Friday.
“It’s critical that Oregonians trust their government,” Kotek said in an emailed statement.
Kotek said she was urging the Oregon Government Ethics Commission “to immediately investigate this situation” and asked the Oregon Department of Justice to examine the audit.
The audit questioned the OLCC’s requirement that marijuana businesses keep their stash behind steel doors and have 24-hour video surveillance systems. The OLCC should make marijuana regulations more like those governing distilled spirits, which the agency also regulates, the auditors said.
The audit also said Oregon should prepare for the U.S. government eventually legalizing marijuana and position the state, with its huge stockpiles of the drug, as a national leader in the industry.
Oregon, long known for its potent marijuana, would be competing with other pot-producing states — particularly California, which also has a vast oversupply — for the export market if marijuana is ever legalized nationally.
A total of 21 states and Washington, D.C., have legalized recreational use of marijuana, but activists see little chance of the current Congress moving toward national legalization. Still, there’s hope the Biden administration will allow pot commerce among states that have legalized it.
The Associated Press contributed to this report.
