DOC director Colette Peters acted before her agency finished reviewing Killgore's allegations. She named Gary Kilmer, a veteran prison executive and a deputy administrator at OCE, to take over.
"I have no doubt this is retaliation for turning in the original
information," Killgore told The Oregonian on Thursday. He noted that his
allegations also concerned conduct by Peters.
Peters, through an aide, denied any retaliation. "This change has nothing to do with the recent criminal investigation," said Liz Craig, DOC communications manager.
Michael Jordan, chief operating officer at the state Department of Administrative Services, acknowledged the timing looks bad.
"She has every right to get who she wants in that spot," Jordan said.
Craig said the DOC inspector general is still reviewing the Justice Department report and so far isn't doing additional investigation. The inspector general is evaluating whether any administrative action, including discipline, is warranted against DOC employees.
Jordan said he has separately asked the Justice Department for further investigation into some allegations for his own review. He wouldn't elaborate, saying only that additional interviews are needed.
The Oregon Government Ethics Commission is monitoring developments, Executive Director Ron Bersin said. He said the agency will probably ask for the results of the Corrections Department internal review, particularly with an eye to whether corrections officials misused their positions in hiring practices.
Oregon Corrections Enterprises is separate from the Corrections Department. It runs factories and work centers inside eight prisons, employing about 1,100 inmates who produce products ranging from furniture to bluejeans and who answer telemarketing and customer service inquiries at call centers.
Killgore, who became administrator in 2002, last year grew concerned with how Corrections Department officials were tapping OCE for off-budget acquisitions and spending. OCE's budget, unlike that of DOC, doesn't get legislative vetting.
Last August, he took Jordan's staff a thick binder documenting what he said was $5 million in inappropriate spending over 10 years. Much of that was paid to workers prison officials forced OCE to hire, he said, in some cases when no job opening existed.
The Justice Department completed its report Feb. 8, but it wasn't publicly disclosed until this month, after The Oregonian obtained a copy. The report said OCE operated in a culture in which "inappropriate" gestures of good will were sought by Corrections Department executives.
Among examples cited were requests from then-DOC director Max Williams for $5,000 sponsorships for Boy Scout banquets. Williams was a director of a Boy Scout council. The investigators also questioned the role of Deputy Director Mitch Morrow in the hiring of his son by OCE.
In a letter she hand-delivered to Killgore, Peters said, "I need an advisor rather than an administrator who advocates for approaches he already knows I have chosen not to pursue." She cited concerns with how Killgore arranged for Portland State University to do an independent analysis of OCE, use of an outside attorney, and labor complaints.
"Low staff morale in OCE has been raised directly to me as an issue, although not completely investigated," she wrote.
The PSU study has been a particularly nettlesome issue. Killgore contracted with the university's Center for Public Service to assess OCE. The center found a confusing relationship between DOC and OCE, and recommended that Gov. John Kitzhaber act quickly to clear up the roles. The report also warned that prison industries was running in the red this year.
Killgore told The Oregonian on Thursday that Peters wasn't happy with the report: "Colette did not want any type of business review, and she did not want any recommendations involving delegation of her authority."
Craig said Peters wants a robust OCE but that Killgore wasn't the one to make that happen. "His vision and her vision weren't really aligning," she said.