State agency money funded Mary Easley's job

Raleigh, N.C. — North Carolina State University gave former first lady Mary Easley an 88 percent raise last year with the understanding that her fundraising activities would help pay her salary.

Documents the university turned over to a federal grand jury on Friday show that some of that fundraising involved money from other state and local agencies.

The grand jury is investigating former Gov. Mike Easley's dealings with friends and contributors while he was in office, including how Mary Easley obtained her job at N.C. State.

The university hired her in 2005 as an executive-in-residence and senior lecturer to develop the Millennium Seminars speakers program and to teach two courses. Last year, she received a raise to $170,000 a year, a move that N.C. State officials defended at the time by saying she had taken on additional duties.

The UNC Board of Governors' approval of the $170,000-a-year salary states that $55,250 would come from "non-state funds," which was defined as "grants and private funds."

Some of the funds she solicited on behalf of the Millennium Seminars included $5,000 from the state Alcoholic Beverage Control Commission and another $5,000 from the Wake County Board of Alcohol Control, according to the documents given to the grand jury.

E-mails included in the documents show that the provost's office asked that some payments be directed into a university account that paid part of Mary Easley's salary and not deposited into the account for the speaker series.

N.C. State spokesman Keith Nichols said the university interpreted "non-state funds" to be any money not appropriated directly to N.C. State.

Citing state budget cuts to the programs she oversaw, N.C. State terminated Mary Easley's contract in June. She has appealed the termination.

Questions about her hiring and promotion led to the resignations this spring of three high-ranking university officials, including Chancellor James Oblinger. They have denied any wrongdoing.

Preliminary findings of a state audit that were released Thursday found that Mary Easley's salary was excessive based on her duties. Auditors said she should have been paid $79,000 for the various programs she ran.

That audit, started last fall under former Auditor Les Merritt, was subpoenaed by the grand jury in May.

State Auditor Beth Wood ended the audit when she took office this year, saying she thought it was partisan and lacked credibility, including inaccurate salary comparisons.

In addition to Mary Easley's job, federal investigators are looking at Mike Easley's travel while he was governor, vehicles that car dealers provided to the family, a waterfront lot in Carteret County the Easleys purchased at a below-market price, the state's sale of a Southport marina to a group that included political contributors and Division of Motor Vehicles moves that might have benefited a political contributor.