Latest liquor scandal costs taxpayers tens of millions

By Taxpayer Association of Oregon

Craig Prins Interim Director of the Oregon Liquor and Cannabis Commission announced that the OLCC will locate its headquarters to Salem instead of at a facility in Canby.  Prins told employees in an email as reported by Willamette Week that “we cannot afford to build an office-warehouse complex as it was originally planned and designed.” OLCC’s warehouse and headquarters are currently in Milwaukie.

Earlier this year, the state paid $40.78 million for the raw land in Canby where the warehouse and administrative offices would be sited. The sale price was nearly three times what it expected to pay according to the Public Lands Advisory Committee and was a  controversial purchase.

The original 2019 estimate of $62.5 million for the land and construction costs ballooned to an astronomical $145.8 million. The state estimated it would cost $19 million to build the administrative offices, but this week reasoning prevailed and the OLCC decided instead to rent space in a state-owned Salem building for $250,000 a year.

In a twist to the story, Willamette Week previously reported that:

“Originally, the plan was to buy a ready-made facility. But… when the agency sought permission from Gov. Kate Brown and the Oregon Department of Administrative Services to move forward, it was instructed to break the proposition in two: buy the land first and build the headquarters and warehouse afterward.

The rationale, (Former OLCC Director of Distilled Spirits Chris) Mayton says: “equity and inclusion.” If the state controlled the construction contract, it could control who got the work.

And in a tangled web of OLCC intrigue, the commission has faced increasing pressure over ethics violations by key executives. Governor Kotek asked the former director to resign, fired five others, and forced the resignation of the OLCC board chair for a scandal involving executives using confidential information to purchase rare Pappy VanWinkle bourbon for themselves. The bourbon can cost thousands of dollars per bottle. Oregon law prohibits public officials from using confidential information for personal gain.

In other troubles, former OLCC Director Steve Marks is planning to sue the state and claims that Gov. Tina Kotek forced him out at the request of her political donors Rosa Cazares and Aaron Mitchell who run the troubled La Mota cannabis chain regulated by the OLCC. They were unhappy with OLCC regulations that La Mota faced and were major donors to Oregon Democrat politicians and causes, giving actual stacks of cash to candidates.

Cazares and Mitchell also paid former Oregon Secretary of State Shemia Fagan $10,000 a month as a consultant while she was in office and whose agency would have overseen an audit of La Mota. Mitchell also donated $45,000 to Fagan’s campaign. Fagin has since resigned. 

Federal prosecutors are investigating La Mota and Shemia Fagan over her moonlighting for the company.