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California secretary of state resigns

SACRAMENTO, Calif. - California's embattled secretary of state resigned Friday amid investigations into his handling of federal election funds, questionable campaign contributions and bad workplace conduct.

At a news conference outside his San Francisco home with his wife at his side, Kevin Shelley reiterated that he thinks he has done nothing wrong, but said he wanted to step down because the investigations had become too much of a distraction.

"During the past several weeks and days, it has become clear to me that the tides of this storm are overtaking this office's very ability to function effectively for the people of California," Shelley said.

Shelley, the son of a former congressman and San Francisco mayor, was once one of California's rising political stars and had been considered a future Democratic candidate for governor.

He was to testify later this month at a legislative audit committee hearing about his handling of millions of dollars in federal elections funds.

Shelley, 49, said he was confident the investigations ultimately would clear his name.

He said his resignation would be effective March 1. His move paves the way for Gov. Arnold Schwarzenegger, a Republican, to name a replacement.

Shelley recently found himself embroiled in controversy over the federal election money and charges by ex-employees of temper tantrums and a hostile work environment. He has not been charged with breaking any laws.

The state Board of Personnel criticized some of his office hiring practices as possibly illegal and a throwback to the "spoils system." Shelley likewise faced investigations for accepting $125,000 in campaign funds from recipients of state grant funds for a San Francisco neighborhood center that was never built.

The main source of Shelley's problems was a December state audit that charged him with poor management of $46-million in federal election funds.

The money was set aside by Congress to modernize voting systems.

The audit painted a picture of an office in disarray that missed deadlines to send the funds to counties, avoided competitive bids for services and paid consultants for work that had little to do with the purpose of the funds.

The audit also found that Shelley paid consultants for federally funded voter outreach that included attending partisan Democrat events and fundraisers and promoting Shelley's political profile.

Shelley said he didn't know about the campaign contributions and had returned them. He acknowledged problems with the federal funds, but said other states would fare no better under similar scrutiny.

He also denied allegations of an abusive workplace.

"I want to say that I am sorry," Shelley said Friday. "In too many cases, my intense drive to accomplish good things has been tarnished by my impatience and I have allowed myself to direct that impatience at individuals when it should have been directed elsewhere. I have no one to blame for this but myself."

Shelley has won widespread praise the last two years for how he has run California's election operation, including a gubernatorial recall in 2003 and his push for better safeguards for electronic voting machines.

[Last modified February 5, 2005, 00:58:03]