Ousted Palmer city manager responds to City Council investigation as mayor faces calls for resignation and a recall petition

ANCHORAGE, Alaska (KTUU) – After Palmer City Council members began investigating the deputy mayor’s claims Tuesday night that former city manager Stephen Jellie deleted 120 emails in his final hours as an employee, just 51 days after Jellie responded to the allegations when he resigned before taking office.

Jellie resigned his position as Palmer city manager on Oct. 9 and wrote two separate letters this week responding to allegations from Palmer City Attorney Sarah Heath that he may have violated labor laws when he hired the police chief in placed on administrative leave.

“Deputy Mayor [Josh] “Tudor’s statements are similar to District Attorney Sarah Heath’s knowingly false and completely fictitious statement on October 8, 2024 and former Councilwoman Pamela Melin’s recent social media comments about me,” Jellie said in the October 23 letter. “I am fully prepared and ready to engage in an independent investigative process should the Palmer City Council have the courage to take such action, which is in the best interest of the entire City of Palmer workforce and citizenry.”

Jellie’s resignation agreement — which included $75,000 in severance pay (six months of his annual salary) as well as six months of health insurance in addition to any accrued benefits — followed a public uproar earlier this month over possible public safety budget cuts affecting the dispatch center would impact.

The controversy grew when Jellie placed Palmer Police Chief Dwayne Shelton, who was rehired Tuesday night, on administrative leave after Shelton said he tried to address concerns with Jellie.

While Jellie reiterated in an interview with Alaska’s News Source on Thursday that he has no plans to sue the city – citing the language of the rescission agreement – he said he felt after what he heard when he left the meeting on Tuesday evening from home, forced to write to city leaders.

“It looks like some members of the City Council want to violate this agreement… which wouldn’t necessarily be impossible, but certainly isn’t what they should do when there are two parties involved in an agreement. said Jellie. “To simply discuss something like this in an open forum really makes no sense and is complete [and] professionally inappropriate.”

In his letter, Jellie continued that he was “surprised” and “embarrassed” that council members walked away from a unanimous vote to amend the city manager employment contract that was previously approved earlier this month.

“I am concerned that council members are discussing that this agreement may have been made illegally and violates the Open Meetings Act,” Jellie said.

Jellie also said Deputy Mayor Josh Tudor’s claim that he deleted emails to cover up inappropriate actions made in less than two months as city manager was untrue.

“I don’t think he can prove for one second that I deleted one email, let alone 120,” Jellie said. “I think things like this need to be investigated and investigated so that we can get to the truth. I don’t think this is all behind the slogan “We don’t want anyone to be retaliated against or take any action” – fine, give everyone immunity, but let’s get the truth out there.

“Let’s get the facts on the table so we know who is telling the truth and who is relying on lies.”

During Tuesday night’s meeting, some council members also called for Mayor Steve Carrington’s resignation after they said he worked with an outside attorney to draft Jellie’s severance agreement without their involvement, violating open meeting rules by not disclosing the agreement to the public and a laptop returned to Jellie after he left the meeting where a public statement called for Jellie’s resignation.

In denying any wrongdoing on Thursday, Carrington told Alaska’s News Source that he would not be “coerced into resigning.”

Carrington said he was still in his position as city manager at the time he returned the laptop to Jellie, so there was no reason not to return it.

As for the allegation of hiring outside counsel, he said the city uses different attorneys for different reasons and that the attorney he contacted has been used in various capacities over the years.

“I’m a little worried. Part of what I’ve always loved about Palmer is that we work together as a community and things have become very divisive,” Carrington said. “I’ve worked with the city of Palmer and serving is what I do…I don’t have any big, lofty political ambitions. I’ve always said I’m here because of Palmer.”

The council’s call for resignation comes at a time when Cindy Hudgins of Palmer is listed as a petitioner for Carrington’s recall.

Hudgins did not respond to requests for comment from Alaska’s News Source, which requested a copy of the petition.

Jellie’s latest resignation follows two other resignations from similar jobs in Ogdenburg, New York, and Jackson, Wyoming, where he received payouts totaling $200,000.

He continues to call “baseless” allegations that his resignations have become a pattern of moving from one job in the city to the next.

“This is ultimately the first severance package I have ever received,” Jellie said. “The story is about getting one in Ogdensburg – that’s wrong. That was a bonus for working two jobs for two and a half years. I can’t comment too much on Teton County other than to say that I didn’t have a contract there. I didn’t have any severance agreement there. That was an agreement reached between lawyers so I could separate.”

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