SAN FRANCISCO (KPIX 5) — KPIX 5 has learned that Democratic State Senator Leland Yee is refusing to resign his seat following Wednesday’s arrest on federal corruption charges.

According to sources familiar with the matter, Yee has made it clear that he will ask for a leave of absence but so far has not formally requested it.

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A spokesman for Majority Leader Darrell Steinberg would not confirm the discussions, but said a Senate vote to suspend Yee from his seat will go forward.

“Senator Steinberg was crystal clear yesterday at the press conference,” said Rhys Williams, Steinberg’s spokesman. “He has given the ultimatum that Senator Yee will resign or be suspended by a vote of the Senate.”

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Earlier Thursday, Senator Yee’s attorney Paul DeMeester, said Yee had not yet made a decision on whether he will try to keep his Senate seat but announced Yee had dropped out of the race for California Secretary of State

DeMeester, read a letter that Yee sent to California Secretary of State Debra Bowen on Thursday informing her that he was withdrawing his candidacy.

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Federal agents arrested Lee at his home in San Francisco Wednesday morning and he was driven to the federal courthouse while his offices in Sacramento were raided.

KCBS, KPIX 5 and San Francisco Chronicle Insider Phil Matier said the fallout from State Sen. Leland Lee’s indictment is far from over. “This has a lot of tentacles in San Francisco’s politics and various community organizations,” Matier told KCBS.

The charges against Yee include conspiracy to deal firearms without a license, conspiracy to illegally transport firearms, six counts of a scheme to defraud citizens on his services, and wire fraud. A handcuffed and shackled Lee was released on a $500,000 unsecured bond Wednesday evening and was scheduled to return to court Monday to revisit the terms of his release.

A vote was scheduled for Friday to suspend Yee.  If Yee is suspended, he would continue to be paid, but lose all voting privileges in the Senate.

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On March 2nd, State Senator Ronald Calderon announced he was taking a leave of absence while he also fights federal corruption charges.