Etheridge congratulated Ellmers on Friday afternoon, saying his campaign came up just a little short. A recount that concluded in the morning showed Ellmers with a 1,500-vote advantage out of about 190,000 cast.
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Ellmers is a nurse who campaigned with the backing of the tea party movement and an early endorsement from former Alaska Gov. Sarah Palin.
Etheridge is a veteran lawmaker who had won previous elections by a wide margin.
Etheridge says he is preparing to leave elected office with pride in his accomplishments and gratitude for those who helped him along the way.