AUSTIN — A Travis County grand jury indicted Texas Gov. Rick Perry on Friday, accusing him of abusing the powers of his office by carrying out a threat to veto funding for prosecutors investigating public corruption making the possible 2016 presidential hopeful his states first indicted governor in nearly a century.A special prosecutor spent months calling witnesses and presenting evidence that Perry broke the law when he promised publicly to veto $7.5 million over two years for the Public Integrity Unit run by the office of Travis County District Attorney Rosemary Lehmberg.Lehmberg, a Democrat, was convicted of drunken driving, but refused Perrys calls to resign. Although the Republican governor now has been indicted on two felony counts, politics dominates the case. Lehmberg is based in Austin, which is heavily Democratic, in contrast to most of the rest of conservative Texas. The grand jury consisted of Austin-area residents. The unit Lehmberg oversees investigates statewide allegations of corruption and political wrongdoing. It led the investigation against former U.S. House Majority Leader Tom DeLay, a Texas Republican who in 2010 was convicted of money laundering and conspiracy to commit money laundering for taking part in a scheme to influence elections in his home state convictions later vacated by an appeals court. Mary Anne Wiley, Perrys general counsel, predicted Perry ultimately will be cleared of the charges against him abuse of official capacity and coercion of a public servant. The veto in question was made in accordance with the veto authority afforded to every governor under the Texas Constitution, she said. David Botsford, Perrys defense attorney, whose $450-per hour fees are being paid for by state funds, said he was outraged by the action. This clearly represents political abuse of the court system, and there is no legal basis in this decision, Botsford said in a statement. Todays action, which violates the separation of powers outlined in the Texas Constitution, is nothing more than an effort to weaken the constitutional authority granted to the office of Texas governor, and sets a dangerous precedent by allowing a grand jury to punish the exercise of a lawful and constitutional authority afforded to the Texas governor. Several top aides to Perry appeared before grand jurors, including his deputy chief of staff, legislative director and general counsel. Perry did not testify.Abuse of official capacity is a first-degree felony with potential punishments of five to 99 years in prison. Coercion of a public servant is a third-degree felony that carries a punishment of two to 10 years. Perrys futureIn office since 2000 and already the longest-serving governor in Texas history, Perry isnt seeking re-election in November. When he ran for president in 2012, Perry plummeted from brief front-runner to national punchline, his once-promising campaign doomed by a series of embarrassing gaffes, including his infamous Oops moment during a debate. As he eyes another White House run, Perry has re-made his cowboy image, donning stylish glasses, studying up on foreign and domestic affairs, and promising conservatives nationally that hes far more humble this time around.Political observers say the indictment may not immediately hurt his standing with Republican primary voters but Democrats didnt miss a chance to gloat Friday. Texans deserve real leadership, and this is unbecoming of our governor, Texas Democratic Party Chairman Gilberto Hinojosa said in a statement. He demanded that Perry immediately resign. Veto powerNo one disputes that Perry is allowed to veto measures approved by the Legislature. But the left-leaning Texans for Public Justice government watchdog group filed an ethics complaint accusing the governor of coercion because he threatened to use his veto before actually doing so in an attempt to pressure Lehmberg to quit. Were pleased that the grand jury determined that the governors bullying crossed the line into illegal behavior, said Craig McDonald, executive director of Texans for Public Justice. The complaint had merit; serious laws were potentially broken. Not everyone is convinced.My first impression is, What's the big deal? said Allan Saxe, a political science professor at the University of Texas at Arlington. The governor has a right to a veto and a line-item veto.When a governor says I'm going to veto something, there's power involved.Michael McCrum, the San Antonio-based special prosecutor, said he took into account the fact that were talking about a governor of a state and a governor of the state of Texas, which we all love. Obviously that carries a lot of importance, McCrum said. But when it gets down to it, the law is the law. McCrum said hell meet with Botsford on Monday to discuss when he will come to the courthouse to be arraigned. McCrum said he doesnt know when Perry will be booked. The indictment of Perry is the first of its kind since 1917, when James Pa Ferguson was indicted on charges stemming from his veto of state funding to the University of Texas in an effort to unseat faculty and staff members he objected to. Ferguson was eventually impeached, then resigned before being convicted. Staff writer Anna M. Tinsley contributed to this report.