Oregon secretary of state resigns over outside cannabis gig

Oregon Secretary of State Shemia Fagan resigned under pressure Tuesday for taking outside consulting work with a major cannabis company whose owners had also contributed to her campaign.

Why it matters: Fagan's resignation comes just one day after she apologized to Oregonians for taking the consulting gig with the state's second-largest dispensary chain while her office was doing an audit of the state agency that oversees the cannabis industry. That audit ultimately called on legislators to loosen marijuana laws.

The intrigue: Previously, Fagan defended her consultancy work with La Mota owners Rosa Cazares and Aaron Mitchell, saying her annual salary of $77,000 as secretary of state was not enough to make ends meet.

• Her consulting contract had no specific deliverables, but she was offered a $30,000 bonus if La Mota obtained business licenses in other states.

What they're saying: "While I am confident that the ethics investigation will show that I followed the state's legal and ethical guidelines in trying to make ends meet for my family, it is clear that my actions have become a distraction from the important and critical work of the Secretary of State's office," Fagan said in a written statement.

Details: After Fagan released details of her $10,000-per-month job with Veriede Holding, an affiliate of La Mota, Gov. Tina Kotek requested an ethics investigation and an Oregon Department of Justice review of the audit.

• The audit, published last week, had found that the cannabis industry faces particular burdens because of federal banking and interstate commerce rules and that Oregon's regulatory system "compounds these problems."
• The audit had recommended that the state help the industry by reviewing costly security requirements, like 24-hour surveillance cameras, and by directing the state economic development agency to start supporting the cannabis industry.

Zoom out: In March, Willamette Week published an investigation that found Cazares and Mitchell were the defendants in 30 lawsuits aimed at the embattled cannabis chain, alleging over $1.7 million in unpaid bills to vendors and testing laboratories.

What's next: Fagan's resignation will take effect Monday. Deputy Secretary of State Cheryl Myers will be in charge of the secretary of state's office until Kotek taps a new second-in-command.

The photo caption in this story has been corrected to reflect that Shemia Fagan was elected secretary of state in 2020, not 2021.