In Oregon, did “first lady” Cylvia Hayes stick her neck out too far on poverty, health and genuine progress — or consulting?

At the heart of the 2015 gubernatorial political upheaval in Oregon is an underlying question:  When a close friend of a public official is being paid by third parties to advocate particular policies, what is the responsibility of the public official to put distance between their public role and that friendship? And what if the close friend is a fiancee? Can she pursue her advocacy in government buildings?  In Oregon, did Hayes and Kitzhaber cross some ethical line?
Is Cylvia Hayes a Rules Change giraffe, or something else?
An effort by the state of Oregon to measure progress by new methods besides gross domestic product  moved in February, 2015 near the center of a political controversy which drove the state’s three-term governor, John Kitzhaber, to announce his resignation.  Kitzhaber and his fiancee, Cylvia Hayes, support adoption of a “Genuine Progress Indicator” standard for measuring Oregon’s happiness and well being beyond traditional economic indicators.  Hayes spoke about the GPI idea, and the challenges of health and poverty at the CommonBound conference in Boston in June, 2014.
Cylvia Hayes

Cylvia Hayes

Now a federal prosecutor and state ethics officials may be pondering that question.  In the meantime, what happens to the issues Hayes and Kitzhaber have advocated?
Stories about the impending resignation of Kitzhaber mentioned the consulting work of Hayes.  Hayes was not employed by the state, but described herself as “Oregon’s First Lady,” as a result of her long-term relationship with Kitzhaber. News accounts describe her as working on her consulting  business from government offices.   “”She’s an independent woman,” Kitzhaber said during  a January news conference. “She doesn’t work for the state of Oregon . . . . ”  The governor said Hayes is traveling to Berlin to participate in a conference on the Gross National Happiness index, part of a series of meetings that included Kitzhaber and Hayes’ controversial trip to Bhutan in 2013.
DocumentThe Oregon GPI Proposal   . . . “an alternative measure for the state’s economy that takes into account not just goods produced but citizens’ well-being.”
The nub of the story seemed to be this, as one Washington Post account put it: 
“Cylvia Hayes was guiding state employees on the implementation of a new policy [the Genuine Progress Indicator] even as she was doing private consulting work for a group pushing the same policy. “
The Portland Oregonian, the state’s dominant paper, has been covering the issue for months:  EXAMPLE No. 1 and EXAMPLE No. 2.
“The mounting scandal over those contracts, which paid Hayes at least $213,000 since 2011, prompted Kitzhaber to resign Friday,” The Oregonian reported. “The subpoena seeks information concerning Hayes’ clients and partners including Demos, Resource Media, Energy Foundation, [Eugene-based] Rural Development Initiatives, [Washington, D.C.-based] Clean Economy Development Center, Waste to Energy and the Oregon Business Council.” State officials are ordered to turn over to the grand jury records that are a catalog of Kitzhaber’s climate and economy-related initiatives:Genuine Progress Indicator, Pacific Coast Collaborative, Oregon Prosperity Initiative, low carbon fuel standards and sustainable economic development . . . The state is ordered to turn over emails, correspondence, memos and other state records about Hayes’ clients, including Demos, Resource Media, Energy Foundation, Rural Development Initiatives, Clean Economy Development Center, Waste to Energy.
A more details summary of the alleged conflict appeared in an earlier, FEb. 9 Washington Post account, excerpted below. 
From a Portland Oregonian/Oregon live report, quoting a legal response from Hayes and Kitzhaber in a state ethics-commission inquiry: 
“The title ‘First Lady’ does not refer to an official office within Oregon state government or an officer of Oregon state government,” they wrote. “Ms. Hayes is not a public official.”  The Oregonian account continues: “Hayes incorporated the title of first lady into her state role as well as her private consulting work. She sought state reimbursement for more than $3,600 she spent on travel and meals while conducting first lady business.She once used a desk in the governor’s office suite, and had a state-paid assistant. As for whether she was a public official, she subbed in for the governor at public events. She orchestrated meetings with senior state officials. She served as the governor’s unpaid adviser on energy and economic policies – by the governor’s reckoning, contributing thousands of hours. She also signed disclosure forms labeled “Guidelines for Outside Employment of Public Officials.” In 2011, she registered as a lobbyist for the governor’s office . . . The governor’s office acknowledged both roles in a letter last Oct. 13 to the Ethics Commission, saying the office “has treated Cylvia Hayes in her First Lady role as a “public official” in order to ensure compliance with state ethics statutes.” (See: DocumentHayes’ conflict of interest forms)
In a wrap-up story published in the Washington Post on Feb. 9, the paper’s reporter said “Kitzhaber has struggled to describe Hayes’s dual role as both one of his top public advisers and a private consultant with business before the state.”  The Post account continued: “Last week, The Oregonian, the state’s largest newspaper, called on Kitzhaber to resign.”

The latest cache of e-mails, released Friday to The Oregonian and obtained by The Washington Post, show Hayes was involved in the development of an alternative economic measure, the Genuine Progress Indicator, at the same time she was being paid by Demos, the group that advocates for adoption of the indicator. Those e-mails show Hayes scheduled a meeting with top officials in the governor’s administration and the Department of Administrative Services to discuss the Genuine Progress Indicator at Mahonia Hall, Oregon’s governor’s mansion, just three days after she sent her first invoice to Demos. Many of the e-mails from Hayes include her signature, which identifies her as Oregon’s first lady. The e-mails also include correspondence from Kitzhaber himself, through a Gmail account, strategizing ways to develop a GPI  Web site and suggesting that the state hire a policy expert who helped implement the metric in Maryland. Another e-mail from Hayes to Department of Administrative Services chief operating officer Michael Jordan lays out a description of duties for which that employee would have been responsible, and additional tasks Hayes said she would provide herself. Kitzhaber’s office did not immediately answer a request for comment  . . . Kitzhaber said last month that Hayes would no longer serve in a policy role in the final three years of his term. The Oregon Government Ethics Commission is still looking into Kitzhaber’s administration’s efforts to maintain an ethical line between Hayes’s public and private roles.

Portland’s twice weekly paper, the Portland Tribune, shares with the Bend Bulletin (part of EO Media Group) a reporter covering the state house who did some of the  first tallying of Hayes’ consulting.  The reporter,  Hillary Borrud has a degree from the Columbia University Graduate School of Journalism:

One of Borrud’s stories in January sought out political ethicists to consider whether Hayes relationship with state government through her relationship with Kitzhaber was problematic.  Here is an excerpt of what Borrud wrote:

Experts on government ethics and the intersection of politics and nonprofits said Hayes’ job in particular raises questions, such as whether her compensation was reasonable given the amount of work she did and whether Hayes’ employer sought to use the connection to influence state policy . . .  Kent Redfield, a political science professor at the University of Illinois Springfield, said tangible evidence of Hayes’ work for the Clean Economy Development Center is important, because there are examples across the United States in which entities sought to influence public officials by offering no-show jobs to the officials or their family members  “If there’s no work product and you’ve got a situation where you’re hiring the governor’s spouse or someone with a close personal relationship with the governor, then you can certainly have fraud,” Redfield said.
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