From the Sun-Times:

Ryan worker: Taxpayers paid me

November 8, 2005

BY NATASHA KORECKI Federal Courts Reporter

A chief campaign worker under former Gov. George Ryan testified Monday that taxpayers picked up his monthly salary while he was working full time on Ryan's gubernatorial campaign.

Richard Juliano said the state subsidized at least some other salaries of state employees who worked on Ryan political campaigns as well as office supplies and equipment. But he also testified he never heard Ryan order or discuss cheating taxpayers to fund political employees or his campaign.

The defense also questioned Juliano's motivation for flipping on Ryan, saying he has a keen interest in salvaging his career and avoiding jail time.

Ryan, 71, is on trial with lobbyist friend Lawrence Warner, 67, for, among other charges, allegedly steering state contracts and leases to lobbyists such as Warner and taking cash and other perks. Ryan is also accused of diverting state resources for political campaigns including his 1998 gubernatorial run.

Says state subsidized some items

Juliano pleaded guilty in 2002 to an obstruction charge related to Ryan campaign activities and is still awaiting sentencing. He was the lead witness in the trial that led to the 2003 conviction of Scott Fawell, Ryan's former chief of staff. Fawell later flipped on Ryan.

In his second day of testimony, Juliano testified that in some cases, the state subsidized the campaign's payroll and office equipment -- including an industrial paper shredder, cell phones and parking. Under direct questioning by Assistant U.S. Attorney Patrick Collins, Juliano, Ryan's deputy campaign manager, said Fawell told him to cut back on office supplies and "get started with stuff from here," meaning the secretary of state's office.

Ryan was Illinois secretary of state from 1991 to 1999.

Juliano's testimony noted Ryan's involvement in financial activity in the campaign. He said Ryan stopped in the Citizens for Ryan office several times a week. Juliano, who handled the budget, said he had to get Ryan's approval before spending more than $5,000. Juliano told of a conversation where Ryan expressed concerns that Fawell and Juliano would spend "everything they had left" in Ryan's fund.

'You will go to jail'

While busy with Ryan's 1998 gubernatorial campaign, it was the secretary of state's office that cut his $5,000 monthly checks, Juliano said. He was paid under the guise that he was consulting with a voter initiative. He said he struck the arrangement with Fawell, after Fawell said Ryan's fund -- with a balance he believed to be at about $2 million -- could not afford to keep paying Juliano's salary.

Ryan attorney Dan Webb noted it was Fawell who ran the day-to-day campaign operations and tried to show that Fawell and Juliano --and not Ryan -- knew if employees were complying with split schedules. Campaign workers who were also state employees were supposed to split time for the state and political campaign and bill each payroll appropriately. But many of the workers worked only on the campaign, according to previous testimony and prosecutors.

But Webb noted that at one point Ryan instructed Fawell to move a top aide 100 percent to the campaign payroll and suggested Ryan would have done the same if he knew of other employees getting state money for campaign work. Webb then brought out samples of Ryan's daily public schedules to show he was too busy to keep tabs on employee schedules.

Webb exploited Juliano's deal with the feds noting that in return for his testimony and cooperation, they would ask a judge not to give him jail time.

"It is pretty valuable to you that the government make that motion?" Webb asked.

"Yes," Juliano said.

"Because if the government doesn't do that you will go to jail, won't you?" Webb continued.

"Yes," Juliano said.


HIGHLIGHTS

PROSECUTION: Richard Juliano, onetime deputy campaign manager for former Gov. George Ryan, said taxpayers picked up Juliano's monthly salary even though he worked full time on Ryan's gubernatorial campaign.

DEFENSE: Exploits Juliano's plea deal with the feds, noting that in return for his testimony and cooperation, prosecutors will ask a judge to spare him from prison. They also say it was people under Ryan who made decisions with the campaign's day-to-day operations.

UP NEXT: Juliano's cross examination continues today.