Saturated as he is in the ways of Hollywood, it's no surprise that Gov. Arnold Schwarzenegger (search) knows better than most politicians how to fashion an image for television cameras.

But recent disclosures that several state agencies have distributed video press releases masquerading as TV news reports have Democrats crying foul and news directors re-examining their policies about airing such material.

Aides to Schwarzenegger acknowledge using state money to produce "video news releases," or VNRs (search), that cast an entirely favorable light on some of the administration's most controversial policies.

The videos resemble local television news stories, complete with a suggested introductory script for anchors to read. They're distributed via satellite for stations to use as they wish. There were no reports of any station using one in its entirety.

Democrats, who oppose most of the policy changes the videos are advocating, have denounced the videos as little more than taxpayer-funded propaganda and have asked Attorney General Bill Lockyer to intervene (search).

"I think there's a role for video news releases when they have legitimate purposes of education, but this goes from being an educational tool to a complete scam," said Democratic Assemblyman Paul Koretz.

The Bush administration had a similar flap last year, when the federal Government Accountability Office (search) said the administration violated a prohibition against using public money for propaganda by distributing TV-news style videos promoting proposed Medicare (search) changes. Since then, several agencies in the Bush administration have acknowledged producing TV-news style videos promoting their activities.

Video news releases have been used for years by industries to promote products. They are routinely sent to television newsrooms around the country and often provide useful video images, or "B-roll," to help illustrate a story.

However, most TV stations have strict rules governing the use of VNRs, such as clearly labeling the source of the material when it appears on the air.

"Our official policy is not to run a VNR verbatim, and the only time we use them as B-roll is when we don't have access to a particular shot," said Jeffrey Weinstock, a spokesman for KRON-TV in San Francisco.

The Schwarzenegger administration videos have been used to advocate proposed regulatory changes, like modifying lunch break rules for workers and easing a new law requiring more nurses in California hospitals. One video was produced to help sell a key aspect of Schwarzenegger's political agenda: to pay teachers by merit instead of tenure, and to make it harder for teachers to get tenure.

Rick Rice, undersecretary of the state labor agency which produced the video promoting the lunch break changes, said the videos were educational and fulfilled a legal requirement that the government notify the public about regulatory changes.

"We are proposing these regulations, and we have an obligation to inform the public about what our regulations do," Rice said. "And it's not like we broadcast it directly to the general public. We send it to broadcast professionals who know exactly what they are getting."

Schwarzenegger aides insist that their videos are always clearly labeled as news releases and that the source of the material is never obscured.

"The VNR is no different from written press release, which is written in the same format as a news story," Rice said. "We do millions of these things. The government cranks out millions of press releases every day."