State employee with ties to investigation of auditor fired

OLYMPIA — A state worker with long ties to indicted Washington State Auditor Troy Kelley was dismissed from the agency Monday.

Jason JeRue, a part-time employee who worked out of his home in California, has been on leave since soon after a federal grand jury subpoenaed his records in March as part of the investigation into Kelley, who pleaded not guilty last month to tax evasion and other charges. Jerue was let go Monday as Kelley began a leave of absence, said agency spokesman Thomas Shapley.

Shapley said he could not give specifics on JeRue’s dismissal.

The Auditor’s Office, which is charged with rooting out waste and fraud in state and local government, has been at the center of a federal investigation that was brought to light in March, when it became public that federal agents had searched Kelley’s Tacoma home and that a subpoena had been issued to the agency seeking numerous documents from JeRue.

JeRue, who is not accused of any wrongdoing, has not responded to numerous requests for comment since the investigation came to light. He has known Kelley at least since the two worked together in the late 1990s at a mortgage title company in Los Angeles, and went on to work for Kelley at a business in Washington state that is the subject of the criminal charges against him. Kelley hired him at the Auditor’s Office after being elected in 2012.

The 10 felony counts charge that Kelley stole money from one-time business clients, ducked taxes and obstructed a civil lawsuit.

Kelley has resisted numerous calls to resign but started a leave of absence on Monday afternoon. He has delegated authority to longtime agency employee Jan Jutte on responsibilities like audit authority, contracting and personnel issues. As of Monday afternoon, Kelley’s name and picture were removed from the agency’s website, as was his bio. In its place was information about Jutte, who has taken the title ‘acting state auditor.’ In addition, his name was removed from the wall in the agency’s lobby, and his office was cleared out and Jutte was in the process of moving in.

On Monday, Jutte also released the guidance that the office received last month from the state attorney general’s office concerning whether Kelley could take leave without pay and benefits. Gov. Jay Inslee had sought similar guidance from the state’s top lawyer and had previously announced that based on that, he was moving to have Kelley’s pay halted. Kelley ultimately issued a statement saying he would forego both benefits and his $116,950 a year salary during his leave.

However, while Kelley had initially said his leave would be effective May 1, he later changed that date to 1 p.m. Monday. According to the state’s Health Care Authority, if state employees work eight hours in a month, they receive their benefits for the entire month.

A separate memo sent to the auditor’s office last month, and released Monday, notes that state employees can use eight hours of leave each month to maintain their benefits.

Shapley, the agency’s spokesman, said that Kelley doesn’t have traditional earned leave like unelected state employees do, so he wouldn’t be able to use time each month of his leave to maintain his state health benefits. However, because he delayed the start time of his leave into May, “he will have the same health coverage as he would have had he been employed the whole month.”