After controversy, Oregon governor says no policy role for fiancée

By Shelby Sebens PORTLAND, Ore. (Reuters) - Oregon Democratic Governor John Kitzhaber said on Friday his fiancée will no longer have a policy role in his office amid controversy over whether her consulting work posed a conflict of interest with her position as an unpaid adviser. The move came after fiancée Cylvia Hayes acknowledged in an email this week to the East Oregonian newspaper that she earned $118,000 in previously undisclosed consulting fees in 2011 and 2012 from the Washington-based Clean Economy Development Center while advising the governor on energy policy. "She will have no policy or political position in the governor's office," Kitzhaber told a news conference. Oregon's state ethics commission is investigating complaints, including one by the Republican Party, of alleged conflicts of interest involving Kitzhaber's fiancée, who has also come under fire for an illegal "marriage of convenience" to an immigrant years ago. The complaints have raised questions about whether Hayes' acceptance of consulting contracts with groups seeking to influence state policy may have violated ethics rules, the Republican Party's vice chairman has said. Kitzhaber has been dogged by revelations surrounding his fiancée since she admitted in October that she wed an immigrant in 1997 in exchange for $5,000. The pair divorced in 2002. The consulting fees Hayes disclosed this week were in addition to reports of $85,000 that Kitzhaber disclosed on his annual economic interest forms stating what his fiancée had earned from organizations seeking to influence state policy. Kitzhaber had not revealed the income from the clean economy group on the annual forms like he did with other consulting fees Hayes received. He said the couple didn't see it as a potential conflict of interest and therefore didn't feel it was required to be reported. "We didn't believe the CEDC had an economic or legislative interest in Oregon," he said. Kitzhaber, who was reelected to an unprecedented fourth term last year, faced scrutiny during his bid for reelection when local media reports questioned whether Hayes had used her position in the governor's office for personal gain. Hayes, who had served in Kitzhaber's office as an unpaid adviser on energy, was not present at Friday's news conference because she was out of the country. She could not be reached for comment. Hayes offers environmental consulting services and books public appearances through her business, 3E Strategies. (Reporting by Shelby Sebens; Editing by Cynthia Johnston and Eric Beech)