Shag Fund Explodes

Today brings us a load of media stories about Rudy Giuliani's taxpayer-funded adultery. And Rudy's campaign clearly can't keep the story straight. They appear to have settled on the idea that the expenses were reimbursed by the NYPD and there's nothing to see here. Of course, this is a non-answer. Unless there's some wealthy benefactor named "NYPD," mayor's office and police department funds are all paid by taxpayers. It's irrelevant to the main issue: why did Rudy stash these expenses in obscure portions of the budget in the first place?

One explanation blames anonymous bookkeepers. Then they tried to claim it was a longstanding practice, leading to one of the funniest attempts at spin I've ever seen:

Joe Lhota, a deputy mayor in Giuliani's City Hall, told the Daily News Wednesday night that the administration's practice of allocating security expenses to small city offices that had nothing to do with mayoral protection has "gone on for years" and "predates Giuliani."

When told budget officials from the administrations of Ed Koch and David Dinkins said they did no such thing, Lhota caved Thursday, "I'm going to reverse myself on that. I'm just going to talk about the Giuliani era," Lhota said. "I should only talk about what I know about."

That's priceless.

As more and more gets unearthed, it looks like these Shag Fund expenses were only a part of Giuliani's living off the public dime.

It seems more likely in his final years and months as mayor Rudy was living larger and larger on the NYC dime. And a look at the book-keeping details that are emerging suggests a very conscious effort to use these squirrelly accounting techniques to hide Rudy's high-living ways from public scrutiny. Some of it was Shag Fund spending, but not all, probably not even most.

The problem is that even though the accounting techniques were part of a general effort to hide Rudy's living the high-life on the city's dime, it's now shined a bright light on the Shag Fund. And the Shag Fund was evidently spread more widely than the stuff accounted for with the squirrelly book-keeping.

Who paid for the city car and driver given to Judi while she was still Rudy's mistress?

Who paid for her security detail?

Why did she have one?

Does the city have to pay for travel and expenses for Rudy's wife and his mistress? Can't the budgeting be monogamous even if Rudy's not?

The NY Times has more on this element of the story. The attempts to conceal this from public view until well after his potential Senate run, and his stonewalling of investigations into these practices by auditors in 2001 and 2002, back up the accounts.

(City Comptroller William C. Thompson) said auditors working under his predecessor first raised questions about the travel costs during the Giuliani administration. Their requests to the Giuliani administration for details and justification went unanswered, Mr. Thompson said.

Indeed, while Mr. Giuliani and his aides provided extensive responses yesterday to the reports about the billing practices, they did not, according to the Politico report, offer any explanation before its publication.

You know you're in trouble when Bernie Kerik has to vouch for you.

This story and one other are dominating headlines today. More on that one in a separate post.