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Oregon Corrections Enterprises Whistleblower Receives $450,000 for Wrongful Termination

Oregon Corrections Enterprises Whistleblower Receives $450,000 for Wrongful Termination

by Derek Gilna

Rob Killgore, former director of Oregon Corrections Enterprises (OCE), who was fired by Oregon Department of Corrections (DOC) Director Colette S. Peters after he came forward as a whistleblower alleging wrongdoing in both agencies, settled his wrongful termination claim against the state for $450,000. Peters fired Killgore after his allegations were made public in 2013, saying she wanted to move OCE in a different direction.

OCE is the state agency tasked with providing industry work opportunities for Oregon’s prison population; money not paid in wages to prisoners and other expenses is available to be used for various projects consistent with its mission.

Killgore, who was appointed director of OCE in 2002, had alleged that the culture of the agency compelled or at least strongly encouraged the employment of people suggested by the DOC, as well as the purchase of various items and funding of activities that he felt were inconsistent with OCE’s mission.

A 2013 investigation by the Oregon Department of Justice into his accusations found no criminal conduct. The Justice Department did agree, however, that the practice of corrections officials strongly suggesting that OCE provide funding for certain DOC activities, including the purchase of items such as furniture, the employment of certain individuals and donations to specific causes, for the purpose of creating “goodwill” between the agencies, was inappropriate.

According to the Justice Department’s investigation, OCE funds can only be used to “implement, maintain, and develop prison work programs,” so Killgore began keeping records on what, in his opinion, were $5 million in DOC-requested expenditures over a ten-year period that did not fall into those categories. This embarrassed Peters, though at the time of Killgore’s March 2013 firing she announced there was no connection between his whistleblowing and his subsequent termination.

Some of the items that DOC officials asked OCE to purchase included security cameras, medical devices, a conference table and chairs, bunks, books, funeral expenses, a public relations video and military gift coins. Other expenses included requests from then-DOC director Max Williams to sponsor Boy Scout banquets, when Williams served as director of a Boy Scouts council.

Killgore said he was concerned that OCE was being used as the “DOC’s slush fund.” He indicated he was uncomfortable with the fact that OCE was compelled to purchase things requested by the DOC that would not show up on the DOC’s budget, which is overseen by the state legislature while the OCE’s budget is not.

The Justice Department also criticized the lack of oversight of the relationship between the DOC and OCE, and the apparent reliance of both agencies on various gifts and other gestures outside normally-accepted administrative practices to maintain a cooperative relationship.

Killgore agreed to accept a $450,000 settlement to resolve his wrongful termination claim against the state in May 2014, which consisted of $300,000 in damages plus $150,000 in attorney fees and costs. The payment was made from Oregon’s self-insurance fund, and the state – which reportedly spent $93,000 defending against Killgore’s suit – admitted no wrongdoing. See: Killgore v. State of Oregon Department of Corrections, Marion County Circuit Court (OR), Case No. 13C13825.

In another development resulting from Killgore’s whistleblowing allegations, in March 2015 former DOC deputy director Mitch Morrow agreed to pay $1,000 to settle two ethics violations following an investigation by the Oregon Government Ethics Commission. Morrow was accused of using his influence to secure a job and certain benefits for his son, Zak, who was employed by OCE. The ethics charges resulted from the Justice Department’s review of the relationship between OCE and the DOC.

“There appears to be a substantial objective basis to believe that violations of Oregon Government Ethics law may have occurred and that Mitch Morrow may have committed such violations,” an investigator for the Ethics Commission found.

Morrow retired prior to settling the ethics violations, and his son transferred from OCE to a position with the DOC.



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