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Gov. Tina Kotek demands investigation into Oregon Liquor commission after alleged ethical violation

The exterior of an Oregon Liquor Control Commission building.
Kristian Foden-Vencil
An internal investigation alleges leaders of the Oregon Liquor and Cannabis Commission abused their power.

Top executives and managers at the Oregon Liquor and Cannabis Commission have diverted specialty bourbons away from public consumption for their own personal use for years, according to an internal OLCC document released to OPB on Wednesday.

The investigation, prompted by an OLCC employee complaint, revealed the longstanding practice of OLCC staff, including the agency director, of obtaining rare bottles of liquor.

Steve Marks, who until recently was the leader of the agency, told an investigator he requested staff to divert warehoused liquor to a certain store where he could purchase it, according to the report.

OLCC has a monopoly on liquor sales in the state. Some of the in-demand liquor was set aside so managers could purchase it at a specific store. The liquor is often difficult for the public to obtain since there is often more demand than there is liquor.

“How many times have you done this, what quantity and brands?” the investigator asked Marks.

“I don’t know, a few times for my personal use. Pappy’s 23 is remembered in the last few years,” Marks said, speaking of Pappy Van Winkle’s 23-year-old whiskey, which the investigator noted, is often in high demand and difficult to obtain.

When the investigator asked whether Marks believed he received preferential treatment as an OLCC employee, Marks said, “to some extent yes” but that he also “acquired the same way the public did in the past.” He told the investigator he did not believe his actions violated the spirit of Oregon ethics law, which prohibits people from using their official positions for personal gain.

Marks, the longtime agency director, was not the only one engaged in this practice. The investigation found at least six agency officials diverted alcohol for their personal gain. In one interview, Chris Mayton, the director of distilled spirits, said the practice was widespread and included lawmakers.

Mayton said he served as a “facilitator” for customers, OLCC employees and legislators hundreds of times, according to the report, and added he considered it part of his work duties.

Several other managers also asked to have certain bottles set aside for them so they could be picked up, according to the investigation.

Nikki Leslie, who is in charge of distributing the liquor, told investigators the practice had been going on for as long as she was in her role, dating back eight years. Leslie said she was often asked to divert the liquor to a Milwaukie liquor store location since it is close to their office. The employees were then told the date the product would arrive, so they could contact the business to purchase them.

Earlier this month, Gov. Tina Kotek demanded the resignation of Marks, the longtime OLCC director, as first reported by Willamette Week. But that was before she had learned of the alleged abuse within the agency.

In a sharply worded letter released Wednesday, she made it clear she wants managers and executive leadership within the liquor agency to be fired as well because of what the internal investigation uncovered.

“After requesting the head of the Oregon Liquor and Cannabis Commission’s resignation, my administration became aware that leaders within this agency, including the director himself, abused their position for personal gain per their own admission in an internal investigation,” Kotek wrote. “This behavior is wholly unacceptable. I will not tolerate wrongful violations of our government ethics laws.”

The governor is asking the seven-person commission — whom she appoints — to replace all the managers and executive leadership accused of using their access to benefit themselves and their friends by diverting liquor for their own benefit.

Kotek has asked the state Attorney General’s office to look into the extent of the alleged wrongdoing and, if needed, to recommend stronger protocols for avoiding future ethical lapses.

While on the campaign trail, Kotek promised to reshape leadership at the state government level. So far, Oregon Lottery director Barry Pack, Oregon Department of Emergency Management director Andrew Phelps, Oregon Health Authority director Patrick Allen and the Oregon Department of Education director Colt Gill have all been asked to step down.

Copyright 2023 Oregon Public Broadcasting. To see more, visit Oregon Public Broadcasting.

Lauren Dake