Secretary of State candidate Dennis Richardson. Two sources say Richrdson told state officials in June that he has glioblastoma, an aggressive and fatal form of cancer.

SALEM — Oregon Secretary of State candidate and current labor commissioner Brad Avakian says he believes the secretary has statutory authority to audit private companies when “red flags” have been raised in the execution of public contracts.

This and several other of the Democrat’s ambitions for the office have led to criticism from his opponent, former gubernatorial candidate and Republican state representative Dennis Richardson. Avakian faced similar criticism from members of his own party during the Democratic primary for the office this spring.

Critics have characterized other aspects of Avakian’s platform as beyond the secretary of state’s purview — for example, his plans to promote renewable energy and civics education.

But Avakian countered that he believes he’s squarely within legal authority to audit private businesses, and further, he does not intend to audit every company that has a contract with the state. He also says the other initiatives he wants to pursue fall within the scope of the office.

Avakian says Oregon statutes and the state’s constitution allow the secretary of state to audit companies doing business with the state when concerns have been raised about how the business is being done.

He cites ORS 297.210, which outlines the responsibilities of the secretary’s audits division.

It states: “The Secretary of State, as State Auditor, shall have the accounts and financial affairs of state departments, boards, commissions, institutions and state-aided institutions and agencies of the state reviewed or audited as the Secretary of State considers advisable or necessary.”

Avakian said “financial affairs” includes how contractors use money provided by the state.

“I think the language is broad enough to protect the taxpayer all the way to the endpoint of the money,” Avakian said.

Avakian said if once elected there was disagreement on that interpretation, he could “partner with the legislature to clarify what ‘financial affairs’ means.”

Then there’s ORS 177.170, which sets up a hotline so citizens can report allegations of government waste, abuse or fraud.

Avakian said that those statutes, “taken together” with the state’s constitution, which defines the secretary of state as the auditor of public accounts, justify his aims.

He also pointed to the “About Us” section of the secretary’s website, which explains the secretary’s role, including as a watchdog of public spending.

Avakian pointed to the recent audit of the Department of Energy Business Energy Tax Credits (BETC) program as an example of the types of audits he would do in office.

The audit, released Sept. 8, found evidence of “suspicious behavior” in several dozen energy projects that received the tax credits.

Avakian said that the secretary of state’s audit included interviews with representatives from private companies that received the tax credits.

“…There’s numerous places in there where the secretary refers to interviews they were doing with people in the private sector contracting with the public agency in order to get the information they needed for the audit,” Avakian said. “That is very, very close to what I’m saying needs to be done.”

In a response to questions from the EO Media Group / Pamplin Media Group, Avakian’s opponent, Richardson, said that he interpreted the statutes Avakian cited differently.

Richardson said the first statute only deals with the establishment of a hotline.

Richardson also said that the second statute limited the secretary of state’s audit power to “state departments, boards, commissions, institutions and state-aided institutions and agencies.”

But Avakian said the secretary of state, as public auditor, has a duty to “follow the money” to the end point — how it was spent and whether it was spent for its intended use.

Avakian said that the public bidding process is insufficient to vet how companies spent money they were awarded.

“…There are numerous examples where that process falls short,” Avakian said. “And when it falls short, the question has to be asked, who in state government is in charge of protecting the taxpayer? It isn’t the state agency. That’s why we have the audits division.”

Richardson disagreed.

“Oregon businesses should see the Secretary of State’s Office as a place where they can go for technical expertise to help grow their business or for new businesses to come to Oregon,” Richardson wrote in an email. “It should not be (as Avakian envisions the office), a place to investigate and punish businesses.”

Avakian said that he could not force a company to comply with an audit, though he thought that companies would comply to maintain a good relationship with the state and that a refusal could “tell a strong story.” But also said he would not conclude that a company engaged in wrongdoing based on a refusal to comply.

“The Secretary of State’s Office is not about enforcement, it’s about shining a light,” Avakian said.

Molly Woon, spokeswoman for Secretary of State Jeanne Atkins, said “it is the responsibility of the secretary of state to track and establish standards for the use of public dollars.”

“In some cases those public dollars are given to private entities and agencies are required to establish standards for and enforce appropriate use of those funds,” Woon wrote in an email. “The secretary of state has the discretion to apply her broad authority, with the resources available and across the scope of state government, to ensure that all levels of government meet auditing standards. This certainly would include ensuring that agencies are enforcing Oregon law.”