By Valerie Chinn and Dalton Main

BULLITT COUNTY, Ky. (WDRB) -- Embattled Southeast Bullitt Fire Chief Julius Hatfield has resigned from the department effective Feb. 1, according to a letter obtained by WDRB.

"I want to assure you…that allegations of criminal wrongdoing on my part are false," Hatfield wrote. "However, under the circumstances I feel my continued presence is no longer in the best interest of the Fire Department."

Members of the fire department's board of trustees accepted Hatfield's letter, which calls his resignation a "retirement," without comment Thursday night.

Hatfield did not comment to WDRB News at the department board meeting.  The board could discuss a severance package for Hatfield at its next meeting in February.

Bullitt County Judge Executive Melanie Roberts said Thursday that she had already accepted Hatfield's resignation from the Southeast Bullitt Fire Protection District board.

But when asked about his resignation from his position as chief of the fire department, Roberts said, “This is what needs to happen for this county to proceed with the healing process with everything that has occurred in the past several months.”

Several agencies have been looking into Hatfield and his department, seizing dozens of documents believed to be related to the fire department in November.

They have been specifically investigating several aspects of the department's finances, trying to trace the money that is passed from taxpayers to the department through the Southeast Bullitt Fire Protection District.

“There are so many issues that are not resolved at this point,” Hatfield's attorney Thomas Clay said. “It's very difficult to predict if we are ever going to be able to reach a settlement, or if we're going to have to resolve all of this stuff in court."

Bullitt County Attorney John Wooldridge said Thursday he is working with Clay on a settlement to the case, but no agreement has been reached.

“If resolving it without Mr. Hatfield going to any trials is for the benefit of those people, that is what we are going to work to do,” Wooldridge said.

He says he has put the sheriff's department investigation on hold pending an agreeable resolution.

“Based upon what Mr. Clay may have said I still believe that this can be resolved without criminal charges filed against his clients to the satisfaction of the taxpayers and district members,” Wooldridge said. “The Sheriff will be made aware of any final draft agreement before it's signed off by the county attorney or anyone else.”

"I don't like deals for criminals unless for some reason it is in the best interest of the citizens I serve," Bullitt County Sheriff Dave Greenwell said of a possible deal that might be in the works.

The sheriff's department had said it would pursue charges against Hatfield, including official misconduct, insurance fraud, abuse of public trust, intimidating a witness in a legal process and bribing a witness.

The charges concern the Southeast Bullitt Fire Department taking in about $1 million a year and spending only $375,000 to run the district.

“What are some of the sticking points? Just basic sticking points.” Clay said. “What's going to happen with the records that were seized by the Sheriff's Department, whether there is going to be a criminal prosecution -- whether there is going to be an acknowledgement by the sheriff's department -- they did not have evidence to present to a grand jury on the charges that the sheriff's department alleged they were going to make a presentation on.”

WDRB began investigating the department over a year ago. It started when volunteer firefighters said they were wrongfully terminated by Hatfield. That led to an investigation by the Kentucky Fire Commission, which found that training records within the department were falsified.

In 2014, residents started questioning how the department was spending their tax dollars. Southeast Bullitt has six firehouses but only five full-time employees. Two of the firehouses sit unused.

The Southeast Bullitt Fire Protection District collects the taxes -- about $1 million a year -- and turns over basically all of the money to the Southeast Bullitt Fire Department Inc., a nonprofit organization that provides the fire service.

Christmas bonuses are given every year to paid firefighters. Records show last year, Hatfield's wife, Joanne, received a year-end lump sum payment of $14,000 for volunteering her secretarial and bookkeeping services.

“Whether there is as conflict of interest with Ms. Hatfield doing the books for the fire department, these are all issues we want on the table. We want the public to know what happened with regards to these issues and so far we have not been able to work out an agreement we feel comfortable signing as a result of the discussions we've had thus far," Clay said.

The Southeast Bullitt Fire Protection District and Fire Corporation have both filed lawsuits stemming from allegations of mismanagement and regarding contracts with the fire department.

Both sides will appear in Bullitt County Circuit Court Friday morning.

“I think it's very important that the taxpayers' money and taxpayers' assets are in the possession of the Southeast Fire Protection Board,” Roberts said. “As a taxpayer myself, I don't like to see a penny of my tax money wasted.”

Thomas Clay says Hatfield's wife will also resign from the department, once she has concluded her work.

“We've got an issue with where the money is going and we're taking steps to resolve that,” Clay said. “That's why we have a hearing in Bullitt Circuit Court tomorrow morning (Friday)…because the fire district says they own the money and we don't agree with them.”

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