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The state auditor said Thursday that state Attorney General Mike Easley's use of television public-service announcements over the past two years was acceptable under state laws and regulations.
Easley's Democratic and Republican opponents in this year's governor's race criticized the attorney general, saying he used more than $ 1 million in advertisements since 1993 to promote his political career. Easley faces Republican Richard Vinroot and Libertarian Barbara Howe in the fall governor's race.
Easley has said the ads, paid for with proceeds from lawsuit settlements his office has won, helped warn the public about predatory lending and telemarketing fraud.
State Auditor Ralph Campbell's office concluded that the spending on the ads, which prominently featured fellow Democrat Easley, "did not violate the existing legal requirements according to recent court decisions and regulatory rulings."
The audit examined $ 486,000 in ads from July 1998 through 1999.
It said the ads, which were targeted mainly at poor audiences in Eastern North Carolina, probably were cost-effective because they were aimed at the most likely victims of predatory lending.
The audit noted that the state Department of Administration had exempted the ads from normal competitive-bidding requirements.
Easley was unavailable Thursday for comment. His campaign manager, Jay Reiff, said the audit proved the use of ads were OK.
"Richard Vinroot and his crowd won't like it, but most people like the fact that Mike Easley has protected the public from scam artists," Reiff said. "Consumer education works very well, and Mike Easley has earned a reputation as an aggressive fighter against consumer fraud."
Vinroot's campaign criticized the ads and the audit.
"The attorney general found a loophole and made a choice to spend money for his own benefit that could have gone to schools," said Jack Hawke, a consultant to Vinroot's campaign. "It was wrong, regardless of whether it was legal."
Hawke questioned the credibility of Campbell's audit.
"I wouldn't have expected him to have found anything else," Hawke said. "It's kind of like Bill Clinton: You go get a partisan person to look at it and come out and say there was nothing wrong with it."
The auditor's report was the fourth government approval of the ads in as many years.
Last month a Wake County judge threw out a lawsuit over the ads that N.C. Citizens for a Sound Economy had filed against Easley last fall.
The group is appealing the ruling against the suit, in which it argues that state law required Easley to allocate settlement proceeds to public schools. The case is not likely to be resolved before the fall election.
Chuck Fuller, director of the group, said he considers the audit incomplete. He said his group's lawsuit on appeal could shed additional light on the ads.
"We continue to maintain that the attorney general used money intended to educate students to promote his gubernatorial campaign," he said. "The legal case is not over."
Last fall, the State Board of Elections dismissed a complaint over the ads that was filed by state Rep. Leo Daughtry, then a Republican candidate for governor.
And in 1997 the General Assembly reviewed the ad policy.
"Consumer education is the single-most-valuable tool we have to protect the public," said Alan Hirsch, special deputy attorney general.