Inslee says state will withhold pay from state auditor

OLYMPIA — Gov. Jay Inslee has directed state officials to withhold pay from embattled state Auditor Troy Kelley, who is starting a leave of absence on Friday following his indictment on tax evasion and other charges.

Inslee spokesman David Postman said Tuesday that a letter informing Kelley of the decision was hand delivered to him Monday afternoon. Kelley, who has resisted numerous calls to resign, insists he is innocent and has said he will take a temporary leave while he fights the charges. His current salary is $116,950 a year.

Inslee also repeated his call for Kelley to resign.

“You have lost the trust of the public and the agencies that your office oversees,” Inslee writes. “I urge you to put the interest of the people of the state of Washington above your own.”

Earlier this month, Kelley was indicted by a federal grand jury and pleaded not guilty to 10 felony counts. The indictment charged him with filing false tax returns, attempting to obstruct a lawsuit and possessing more than $1 million in stolen property related to his former business.

The most serious charge carries a possible sentence of up to 20 years in prison. A felony conviction would automatically force Kelley from office, and some lawmakers have spoken about the possibility of impeaching him in light of the charges alone. A petition to recall Kelley from office has also been filed with the secretary of state.

In the letter, Inslee notes that he has directed the Department of Enterprise Services and Office of Financial Management to withhold Kelley’s compensation “as long as you are not preforming the duties of the office you were elected to perform.”

He also advises Kelley to contact the state’s human resources director if he wants to keep his health benefits during his leave, at his own cost.

Last week, Inslee’s office said it believed the state has the authority to withhold pay from Kelley based on legal advice received from the state attorney general’s office.

In the letter, Inslee also directed Kelley to respond in writing no letter than Wednesday to give the governor a plan on how the auditor’s office will be run in his absence. The governor wants to know who will be in charge, what the responsibilities that person will be tasked with, and how long Kelley plans to be on leave, as well as the circumstances under which he plans his return.

“The public and state and local governments deserve a fully functioning State Auditor’s Office, whether you choose to perform your duties or not,” Inslee wrote.

Auditor’s office spokesman Thomas Shapley said that Kelley is expected to respond on Wednesday.

Also Tuesday, in response to Kelley’s plans, two lawmakers introduced a bill for the upcoming special legislative session that would allow the governor to appoint a replacement when an elected official takes a leave.

Current law only allows the governor to appoint a replacement once an office is declared ‘vacant,’ which can only occur if certain situations, including if an official dies, resigns, or is convicted of a felony. The proposal would add “leave of absence from duties that is not due to medical or health-related reasons, or military obligations” to the list.

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