Sisters man arrested on rape charges

Steven Gage of Sisters was arrested on Friday, June 2 at about 2 p.m. by Oregon State Police.

Gage was indicted by a secret Deschutes County Grand Jury earlier that day on 45 counts for actions related to his operation of Royal Haven Equestrian Center for Girls, a home for "troubled" teen females that operated in Sisters until last Christmas.

The charges include two counts of first degree rape (class A felony); eight counts of first degree unlawful sexual penetration (class A felony); 22 counts of first degree sexual abuse (class B felony); six counts of second degree sexual abuse (class C felony); one count of third degree rape (class C felony); and six counts of first degree criminal mistreatment (class C felony).

Gage was lodged in Deschutes County jail on $1 million bail. He was arraigned on Monday, June 5.

At the arraignment, Judge Sullivan noted that there were eight victims included in the charges, and over 20 of the charges could carry mandatory minimum sentences which might be served consecutively. He denied a request to lower Gage's bail.

Gage's partner, Karen Lee, was also arrested on Friday. Lee was charged with seven counts of first degree criminal mistreatment (class C felony) and lodged in jail with bail set at $50,000.

Judge Sullivan did lower Lee's bail to $25,000 at her arraignment on Monday.

Police arrived at the couple's rented ranch at 68819 Chestnut Drive in Sisters at about 1:30 p.m. Gage was not at home but Karen Lee was. At the request of police, Lee phoned Gage, who agreed to wait for law enforcement officers at the county jail, where he was taken into custody.

Gage and Lee closed Royal Haven last December as authorities began investigating Gage on allegations of having sexual relations with one of the girls.

When Royal Haven closed, twenty-one girls were sent back to their parents. Many of those parents had prepaid the $2,500 to $2,750 per month charged by Gage and Lee. One parent prepaid $15,000 and is still out that money, according to the mother of another girl, who asked that her name not be used.

Gage often required payment by cashier's check, often made out to Karen Lee-Gage, even though Karen Lee and Steve Gage were not married, according to two parents.

Those two didn't care much for Steve Gage. "It was 'Look at my boat, look at my Harley (motorcycle)', look at my Lexus,' and jewelry, jewelry, jewelry," said one mother.

But Royal Haven came with good referrals from a Mercer Island (near Seattle) consultant, she said, and from Woodbury Reports, Inc., which claims to be "the Internet's leading source of information on emotional growth schools and programs."

Gage and Lee had published an article in the Woodbury Reports in 1995 titled "Should we punish the parent?"

The father of another girl felt the young women at the ranch seemed to be doing quite well and despite his misgivings, he decided to entrust his daughter's care to Gage and Lee.

Many of the girls were from out of state. Gage had guardianship of the girls for medical and educational purposes. Some charges against the couple are based on the accusation that medical care was denied or delayed, according to the Oregon State Police.

The girls were being educated at Sisters High School. Gage worked with the school district as a volunteer until Boyd Keyser became principal. Karen Lee, served for a time on the Sisters School Board.

When he closed the school, Gage told Sisters Schools Superintendent Steve Swisher "he was having difficulty working with high school staff and the principal over the course of the fall. (He) basically said he needed a break," Swisher said at the time.

Sisters was receiving state school support for the students and when they left, it punched a $43,000 hole in the district's income, according to Swisher.

At least 61 teens, commonly referred to by other students as "Gage girls" have attended Sisters schools since 1994, according to Swisher.

The "Gage girls" were not integrated into the school. Gage insisted that the girls keep to themselves at the high school and limited interaction with other students outside the classroom.

At the time, he claimed this was because some of the girls had backgrounds that included extensive drug abuse and prostitution. That certainly did not apply to all of the girls.

Several sources said Gage attempted to prevent access by the girls to school counselors.

When Gage closed the school, many parents called Superintendent Swisher to see if they could find a way to continue their daughters' education in Sisters, where many of the girls had done quite well.

Several girls were able to finish out the school year in Sisters, according to Swisher.

At the Royal Haven facility on Chestnut Drive in Sisters, most of the girls lived in a dormitory above the horse barn. New arrivals and a few others lived in the main house, according parents of a couple of the girls and at least one former resident of Royal Haven.

Peggy Sowell came to Royal Haven when the facility was located on Cloverdale Road. There, the "Gage girls" were housed in two trailers, seven or eight girls in each trailer, with about eight living with Steve and Karen in the main house, she said.

Sowell arrived at Royal Haven when she was six weeks pregnant. Her son Michael was born at St. Charles in Bend.

In December, 1998, Sowell said Gage moved Royal Haven to a house on O.B. Riley Road in Bend, owned by the parent of one of his charges. In July, 1999, Royal Haven moved to the house on Chestnut Drive in Sisters. "We lived in three places in a year and a half," she said.

At the house on Chestnut, most of the girls lived in a loft over the barn, said Sowell. In the loft, there was a kitchen, a bathroom, a small bedroom where Karen's daughter and a long-time resident lived, and a big living area where Sowell said the other 14 to 20 girls bunked.

When asked if there was more than one fire exit, Sowell said "I don't think so. We never talked about fires. We never had an escape plan or anything."

Even though the girls living in the loft were the ones trusted by Gage and Lee, there were a lot of fights and "power trips," according to Sowell. She said there were 28 girls at Royal Haven when she left in August, 1999.

Gage and Lee attempted to adopt Sowell's son. They gave resistance by state Services to Children and Families to the adoption as one reason for closing Royal Haven.

Sowell told The Nugget that it was her decision to call off the adoption, not SCF action.

"Steve and Karen were pressuring me...they were asking me to give him up. Then I changed my mind. The stuff they were doing there was wrong," she said.

Sowell and her son are living with the child's father, Ryan. Peggy and Ryan live in Texas and are planning to get married in July, said Sowell.

No approvals may have been needed for the girls to live in the barn, aside from county zoning regulations, according to SCF.

Royal Haven was not licensed by the State of Oregon, according to Scott Wickline with the SCF office in Salem.

Wickline said foster families and residential schools are regulated, but since Gage had received parental guardianship and was sending the girls off site to school, there was the belief among some at SCF that they could not conduct unannounced spot checks on the facility.

Patrick Carey of the SCF office in Bend said "In general, we come across these programs in two ways, a license check from a complaint, or allegations of child abuse...You have to find them. Our license process is not difficult to get through, and the folks who are not getting a license usually have a reason."

There has been some turnover in SCF in Salem and the agency may be changing their interpretation of the law and enforcing standards following the situation at Royal Haven.

According to another investigator close to the case, Oregon is one of two states, (the other is Arizona, he said) that doesn't regulate these programs.

Gage is scheduled to enter a plea on the charges on June 26 at 1:30 p.m. Lee is to enter a plea on July 10 at 10 a.m.