The State Auditor's Office has had a long-standing ban on gifts to auditors.

The policy extends to all employees of the office and precludes all but a few narrow exceptions for nominal, token items that could arise out of a speech or service on a board. Gov. Beverly Perdue's executive order bans gifts to all state employees in her administration

The ban specifically precludes gifts from anyone associated with agencies or entities that are audited by the office, said Dennis Patterson, a spokesman for Auditor Beth Wood. Even a small gift to an auditor would be enough to have an audit re-assigned, he said.

"Our folks are pretty tight on it," Patterson said. "The whole idea of being an auditor is you are a totally independent third party...and I can tell you they take it very seriously."

The office also extends the state's ethics law to senior managers who might not have otherwise been covered by the law. Patterson said the office is unlikely to change its policy in light of Perdue's order.

The N.C. Agriculture Department allowed a deputy director to use a state vehicle to commute to Raleigh from Reidsville, without reimbursement, for three years, according to the State Auditor's Office.

A management letter from auditor Beth Wood, a Democrat, found that Patrick Jones, a deputy director of the Pesticide Section was driving his state car to Raleigh four days a week, a financial benefit of $36,546. Wood's office was tipped about the car though the office's anonymous hotline.

State workers are allowed commuting privileges if the employee works from home. For that designation, and its exemption from having to pay back the state to apply, the employee cannot drive to Raleigh more than twice a week.

Wood's letter recommended that Jones be required to repay the state.

In a response, Agriculture Commissioner Steve Troxler, a Republican, downplayed the case, saying that Jones and his supervisor intended for Jones to rarely drive to Raleigh. But the department's involvement in the Ag-Mart pesticide case required him to be in Raleigh more often.

More after the jump.

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The state auditor's office says an employee asked for a voluntary layoff, changed his mind and then filed suit because he fears a layoff.

Attorneys representing the auditor filed a motion Thursday to dismiss a lawsuit filed by Darryl Black, an assistant state auditor who says his bosses have targeted him because his is a Republican. 

Black claimed in his suit that his bosses approached him about a buyout and mentioned that involuntary layoffs were impending, which Black took to mean that his days at the office were numbered. A spokesman for Auditor Beth Wood said the office has a different interpretation how talk started about the buyout, known in state government as a Reduction in Force or RIF.

"This fella came to us and asked for a voluntary RIF, which involves us paying severance pay among other things and health benefits and we agreed to that and go back to him with the paperwork, and all of a sudden he's changed his mind," said Dennis Patterson, a spokesman for the office. "And now we're being sued for trying to accommodate him."

Patterson said that under Republican Auditor Les Merritt, Black had quit his job and returned a day later. He was hired back with the understanding that he would find a new job.

"We inherited this fellow," Patterson said. "Party registration is simply not a factor. It's competence."

Black's attorney, Michael C. Byrne of Raleigh, said "They are free to characterize their actions how they wish and we look forward to seeing how they are characterized under oath in a court of law."

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An assistant auditor has sued the state, claiming that his bosses are going after him because he is a Republican.

Darryl Black sued the Office of the State Auditor, saying that after Democratic Auditor Beth Wood was elected, supervisors in her office began pressuring him to take a voluntary layoff because he is a Republican.

A spokesman for Wood and the Auditor's Office said he could not comment on the lawsuit because it involved personnel issues.

Prior to 2007, Black says in the lawsuit, he received good or even outstanding performance reviews. In 2008, before the most recent election for auditor, Black wrote letters published in The News & Observer. He did not identify himself as a state employee and the issues he wrote about were not connected to his duties as an auditor.

Black previously had run for the legislature as a Republican and he believed his managers knew of his political leanings.

More after the jump.

Correction: An earlier version of this post incorrectly identified the administrative employee who had previously been let go. The employee is a 23-year veteran of the office, not a 23-year-old. Dome regrets the error.

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State Auditor Beth Wood today released a January audit that said the salary N.C. State University paid to then-First Lady Mary Easley was excessive and should have been reduced by nearly $90,000.

But Wood, in a follow-up "interim report" said the January audit was incomplete and that more investigation was needed, reports Dan Kane. She noted that NCSU had provided additional information to justify the $170,000 salary. The January audit recommended that the salary be reduced to $79,000 and that Easley's five-year contract should be replaced by a two-year contract.

Mary Easley's salary, and her hiring at NCSU, have become part of wide-ranging state and federal investigations into perks given to former Gov. Mike Easley and his family.

NET-SIDE CHATS: Gov. Beverly Perdue, who has been hammered by Republicans for a state budget that cut spending and raised taxes, released two videos on YouTube that were addressed to state workers and teachers. The videos were nominally meant to encourage state employees submit money saving ideas for cash prizes. Perdue also used the opportunity to defend the budget and her role in it. Guess it's okay for state employees to be on YouTube at work, huh?

WHENEVER, WHEREVER: Sen. Richard Burr says he'll debate anyone who wants to challenge him next year. Burr, a Republican, may find himself with a full calendar. Democrats, who continue to search for a marquee candidate, are courting former Lt. Gov. Dennis Wicker and U.S. Rep. Bob Etheridge, who join at least four others who are trying to build buzz. All the fuss comes as a poll finds North Carolina residents know very little about the two people who represent them in the Senate.

ONE DOOR CLOSES: Auditor Beth Wood settled a dispute between the auditor's office and the State Ethics Commission that arose from an incident in which a staffer from then Lt. Gov.-Beverly Perdue's office viewed ethics disclosure without supervision. It was probably helpful to have that issue off her plate, since federal investigators looking into former Gov. Mike Easley wanted to talk to Wood about any involvement she had with Easley. A spokesman said there was little to talk about.

IN OTHER NEWS: Former Democratic state Rep. Bob Hensley of Wake County died. The state lottery wants to put ticket dispensing vending machines in chain stores across the state. Elizabeth Edwards said she expects her husband, former Presidential candidate John Edwards, to take a test to settle whether he father a child with his former mistress.

State Auditor Beth Wood testified today before the federal grand jury investigating former Gov. Mike Easley.

Most of the questions revolved around an unreleased audit reviewing the $170,000 salary paid to Mary Easley at N.C. State University before she was fired in June, according to Dennis Patterson, a spokesman for Wood.

Wood, a Democrat, had acknowledged in a previous interview that she had told her staff that one reason for not releasing the salary audit was that state Sen. Tony Rand, a powerful Democrat from Fayetteville and a long-time Easley supporter, would poke holes in it.

Rand had represented Mary Easley when Wood's predecessor, Les Merritt, audited her European travels paid by tax dollars. Merritt found that some expenses were questionable.

Wood was worried whether the salary audit would stand up to close scrutiny, Patterson said.

"She told them Tony Rand is a good lawyer, and if he punched holes in the travel audit, he'd rip up this one," Patterson said.

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State auditors could be making another round of appearances at the federal courthouse connected to the ongoing investigation of former Gov. Mike Easley as a federal grand jury meets in Raleigh this week.

A new federal subpoena asks for more information and possible appearances from staff, including current Democratic State Auditor Beth Wood, J. Andrew Curliss reports.

Among the details federal authorities seek from Wood, who took office in January, is whether she has been in any business ventures or took any kind of money or payments from the Easleys or several people connected to them.

Wood said through a spokesman that she has not been in any business ventures. She is reviewing campaign reports, but does not believe she got money personally or for her campaigns, either.

"She had asked both Easleys for help with her campaign just before and just after the primary, but to her knowledge got none other than the obligatory vocal support for the ticket," said spokesman Dennis Patterson.

Wood's office has not released an audit that reviewed the $170,000 salary paid to Mary Easley at N.C. State before she was fired in June.

Wood acknowledged in a previous interview that she had told her staff that one reason for not releasing the salary audit was that state Sen. Tony Rand, an influential Democrat from Fayetteville, would poke holes in it.

She said she did not speak with Rand about it, however, but was anticipating a response. Rand had represented Mary Easley when Wood's predecessor, Republican Les Merritt, audited her European travels and determined some expenses were questionable.

Investigators in the new subpoenas also asked for information about Mary Easley's trips to France, Estonia and Russia in 2007 and 2008. And they seek information about any contacts between Wood and elected officials.

Several people from the auditors office appeared at the grand jury in previous months.

The state auditor and the State Ethics Commission have ended a battle stemming from an investigation into the handling of then-Lt. Gov. Beverly Perdue's ethics files.

A state audit released today found that officials with the State Ethics Commission had not intentionally destroyed evidence in the matter, but did find that commission staff had not followed procedures in making the ethics statements available to the public, Dan Kane reports.

The case stems from a visit that Perdue's legal counsel, Will Polk, had made in October 2007, to review her ethics statements, which are an accounting of her financial interests. The statements are intended to help officials avoid conflicts of interest. Polk had been allowed to review the files behind closed doors. An aide, Amanda Thaxton, had noted in an electronic log that this was not the commission's policy; a staff email had told them not to let members of the public review ethics files without staff supervision.

Thaxton filed a complaint to the auditor's office, which then launched an investigation. She was later fired by the commission and has since filed a whistleblower's lawsuit that is pending in state court. The commission has denied that she was fired in retaliation. The audit did not address Thaxton's whistleblower claim. Copies of the log showed that her entry had been removed. But the auditor's report released today found that the change was made prior to the commission being notified of the auditor's investigation, so there was no evidence of tampering.

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Secretary of Cultural Resources Linda Carlisle has asked State Auditor Beth Wood to weigh in on a squabble over the N.C. Pottery Center in Seagrove.

It's the latest installment in the pottery feud.

Carlisle wrote Wood last month about ongoing complaints from potters Don Hudson and Phil Morgan.

"They allege that the Department has conspired with the North Carolina Pottery Center to take over the Seagrove Pottery Festival," Carlisle wrote. "They also allege that the Department has attempted to take over the North Carolina Pottery Center in an effort to put rival potters in the area out of business."

Carlisle asked Wood to examine the situation as a neutral third party. 

Hudson forwarded to the N&O an email from Carlisle to potters and others affiliated with the craft, explaining that she was dropping plans to bring the center under the administration of the department. She also wrote that the department was responding to requests for "numerous documents, correspondence, grant applications and reports."