So far seems the NY Daily News is the only paper to give any major attention to the Shag Fund story, despite the evidence holes in Rudy's denial. And for what it's worth, the author of the piece, Ben Smith, used to be at the NYDN.

(ed.note: The Times also reports on the story, though deep, deep in the A section.)

(Of course, one must take into account that since Drudge did not approve it as a major story -- it was flagged as "Rudy Hit With Expense Report" -- they likely don't feel able to cover it aggressively.)

Here's Rudy's denial if you haven't seen it ...

Late Update: CBS actually hits the story too. And significantly they're one of the flew outlets that explicitly hits the non-responsive nature of the Camp Rudy's response ...

Giuliani's campaign had this response, calling the story a non-issue.

"This is common practice," the campaign said in a statement. "The NYPD is responsible for providing security for the mayor of New York around the clock."

"It’s clearly the responsibility of the NYPD to provide the mayor’s security around the clock and that’s what they did,” Giuliani spokesperson Maria Comella told CBS News.

But the question isn't about his security detail. It's about how the expenses were billed.