Oregon child welfare workers described as “credible” the account by a 14-year-old foster boy that other child welfare workers had sex in front of him last year.

According to a state police report obtained by The Oregonian/OregonLive, rumors had been circulating that child welfare supervisor Mark Walsh and paralegal Kate Guy were having an affair before the night they spent supervising the boy at a hotel. While interviewing Guy, Detective Casi Hegney-Bach described it as the “worst kept secret at the Dallas (Department of Human Services) office.”

At the same time, another supervisor at the office and the caseworker assigned to the boy described him as a credible source.

Walsh and Guy have been on paid leave since Nov. 30, according to public records released last month. In interviews, both Guy and Walsh denied they were having an affair and said they did not have sex in front of the boy when they were caring for on him on Nov. 20. They could not be reached for comment Sunday afternoon.

After the state police report was completed, the Oregon Department of Justice declined to file any charges against Walsh and Guy. Senior Assistant Attorney General Kurt Miller wrote on March 15 that there was “insufficient evidence to prove criminal charges beyond a reasonable doubt.”

A lawyer for the boy has notified the state he plans to file a lawsuit over the alleged incident, The Oregonian/OregonLive reported last month. In a tort claim notice, lawyer David L. Kramer accused the state of sending the boy to a juvenile detention facility as punishment after he reported the incident.

The allegations highlight Oregon’s controversial practice of housing children in hotels, state offices and other temporary lodging when state workers cannot find anywhere else for children in the foster system to stay.

Oregon is phasing out the practice known as “hoteling” under a 2018 legal settlement, and Marilyn Jones, Oregon’s child welfare director, personally signs off each time child welfare workers house children in hotels.

However, the agency faces criticism for some of the institutions where it is sending children instead, including residential programs in converted juvenile jails and out-of-state facilities accused of mistreating children.

The alleged incident came to light when the boy’s caseworker, Jaclyn Trujillo, visited him at the Yamhill County juvenile detention center on Nov. 28. It was not clear from the report why the boy was at the detention center.

“During this conversation (the boy) told Trujillo something happened” at the hotel on the night of Nov. 20, but he did not want to disclose what it was, according to the police report.

Eventually, the boy told Trujillo that Walsh and Guy were “doing stuff.” When Trujillo asked if they were having sex, the boy said “yes,” according to the police report. Trujillo immediately reported the allegation to her supervisors. Walsh and Guy were placed on paid leave two days later.

As part of the state police investigation, the boy underwent a child forensic interview at an organization that screens for child abuse. Using dolls, the boy described in detail how the sexual encounter allegedly unfolded in the bed adjacent to his that night at the hotel.

When police interviewed Trujillo on Jan. 3, she said she was not surprised at his allegation because it was common knowledge at the child welfare office in Dallas that Walsh and Guy were having an affair. Trujillo told police she believed the boy was telling the truth.

Trujillo’s supervisor, Chad Blackman, told police in a Jan. 8 interview that he also believed the allegations were true and offered examples of what he considered to be inappropriate office behavior by Walsh and Guy, according to the police report.

“This particular allegation is pretty credible to me,” Blackman said, according to the police report.

Blackman explained that he had found the boy to be credible in another recent situation that involved a dispute with a foster parent who as behaving erratically.

Blackman, who also supervises Guy, said he observed her make an effort to be around Walsh all day, every day. He heard from another previous supervisor that she had observed Guy and Walsh leaving the lactation room — a space generally reserved for breastfeeding mothers — together and that they were adjusting their clothes. Another employee told Blackman that Guy and Walsh left each other “love sticky notes.”

Blackman also said he offered to take over watching the boy at the hotel around midnight and Walsh declined the offer, which Blackman found odd because supervisors were not paid overtime, according to the police report. Blackman said he did not know Guy was at the hotel.

Trujillo told state police she also volunteered to watch the boy at the hotel that night. Asked by state police why Trujillo didn’t supervise the boy that night, Walsh said, “I don’t know.”

Guy and Walsh each declined to voluntarily turn over their cell records. State police subpoenaed Walsh and Guy’s cell phone records, but information about those records was redacted from the documents that were released.

Two of Walsh and Guy’s co-workers told police they did not believe the employees were having an affair.

When police inquired with program manager Stacy Daeschner about the alleged incident, she told them she had received two previous reports that Walsh and Guy were having an affair and engaging in inappropriate conduct at work or a work-related event. Daeschner reportedly told police that she found both complaints were not substantiated.

Daeschner has been on paid leave since Feb. 14. She could not be reached for comment Sunday afternoon.

Another caseworker, Arthur Warren, was interviewed by state police after he volunteered through Daeschner to answer questions about Walsh’s behavior during an April 2018 summit on child abuse.

Warren said he shared a hotel room with Walsh and said that contrary to what another child welfare employee claimed, Walsh did not share a hotel room with Guy during the event. Warren also told police he did not think Guy and Walsh were having an affair.

— Hillary Borrud | hborrud@oregonian.com | 503-294-4034 | @hborrud

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