What do you get when you mix a governor, his ambitious fiancee, a billionaire environmentalist and some handsome green energy consulting contracts? In Oregon, they have collided to produce an influence-peddling scandal that threatens to end Gov. John Kitzhaber’s tenure.

Mr. Kitzhaber, a Democrat, faced increasing pressure Thursday within his own party to resign over accusations that his fiancee sought to use her relationship with the governor to land lucrative consulting contracts for her green energy consulting business.

The top two Democrats in Oregon’s LegislatureSenate President Peter Courtney and House Speaker Tina Kotek — met with Mr. Kitzhaber to urge the four-term governor to step down, joining a growing chorus of leaders hoping to stem the scandal with a resignation.


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“Unfortunately, the current situation has become untenable, and I cannot imagine any scenario by which things improve,” said State Treasurer Ted Wheeler, a Democrat. “Oregon deserves a governor who is fully focused on the duties of state.”

Mr. Kitzhaber remained defiant and said he intended to stay in office.

Oregon’s controversy has created new questions for billionaire environmental activist Tom Steyer, … more >

The scandal carries larger repercussions for national Democrats, who have worked hard to put to rest a controversy in President Obama’s tenure over the failures of taxpayer-funded green energy companies such as Solyndra that had political ties to party bigwigs.


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Oregon’s controversy has created new questions for billionaire environmental activist Tom Steyer, a major Democratic supporter and bundler for Mr. Obama. It also has renewed questions about whether the nation’s embrace of clean energy has become a lobbying bonanza that enriched some well-heeled Democrats.

Oregon’s scandal centers around the governor’s fiancee, Cylvia Hayes, who has been acting first lady as she awaits her wedding to Mr. Kitzhaber.

While serving as an unpaid policy adviser for the governor’s office, Ms. Hayes collected $118,000 in fellowship and consulting fees from the Clean Economy Development Center, a Washington-based nonprofit, for work on low-carbon fuel standard legislation in Oregon.

Ms. Hayes never disclosed the payments on her ethics filings for the governor’s office.

The Clean Economy Development Center went out of business after the IRS pulled its tax-exempt status. Before it did, the center received funding for Ms. Hayes‘ fellowship from another nonprofit, the Energy Foundation, which in 2012 received $200,000 in funding from Mr. Steyer’s “TomKat” Charitable Trust, according to the group’s latest 990 tax form.

The Energy Foundation hired Ms. Hayes directly in 2013 for communications work, giving her a contract of $50,000, according to documents and interviews.

The web of payments, the failure to disclose and questions about influence peddling have prompted the state’s attorney general to open an ethics investigation. Republican state lawmakers also have demanded a suspension of the new fuel legislation, which would keep Oregon’s low carbon fuel standards in place instead of expiring this year.

“The actions of Gov. Kitzhaber and his fiancee, Cylvia Hayes, are questionable. Disclosures of possible conflicts of interest is normal operating behavior for policymakers. Acting as an environmental policy adviser to the governor while also receiving payments from an outside environmental group seems worthy of disclosure,” said Nicole Kaeding, a budget analyst with the Cato Institute.

The Washington Times made multiple attempts to reach out to Ms. Hayes for comment through the governor’s office and her consulting firm, 3E Strategies, but Ms. Hayes did not reply.

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