Former Mayor Rudy Giuliani has decided against running for governor, but is strongly considering running for U.S. Senate instead, sources told the Daily News.
The Republican heavyweight was considered the GOP's best shot at reclaiming the governor's mansion.
The only declared candidate on the Republican side is little-known former Long Island Rep. Rick Lazio.
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One source said Giuliani is prepared to run for U.S. Senate against Democratic Sen. Kirsten Gillibrand in 2010 to fill out the remaining two years of Hillary's Clinton's term.
But a number of sources close to the former mayor said no decision has been made and a Giuliani spokeswoman downplayed the reports.
"Rudy has a history of making up his own mind and has no problem speaking it," she said. "When Mayor Giuliani makes a decision about serving in public office, he will inform New Yorkers on his own."
Former Staten Island Borough President Guy Molinari, a close Giuliani pal, said the former mayor has shared doubts with him for months about running for governor.
"What he said to me is that he doesn't think he's going to do it," Molinari told The News about an early November conversation with the former mayor.
"It just didn't make any sense to him."
Molinari said the ongoing circus in the state Senate, combined with Democratic Assembly Speaker Shelly Silver's iron grip on Assembly matters, had convinced Giuliani that a Republican governor would have little ability to get things done quickly in Albany.
"The big drawback for him was -- could I really be effective?" Molinari said. "He saw too many hang-ups there. He's not running for the title, that's for sure."
His absence from the governor's race would be a boon -- and a bow -- to Attorney General Andrew Cuomo, who is considering a run for the office.
Gov. Paterson, who trails Cuomo by up to 59 points in a hypothetical matchup in some polls, insists he is running, even though the White House has pointedly told him President Obama would "prefer" he didn't.
A Marist poll yesterday showed Giuliani losing to Cuomo 53% to 43% in a race for governor, but he is beating Gillibrand 54% to 40%. Molinari said he favors the idea of Giuliani running for U.S. Senate.
"Some of us, including myself, feel like that would be a better fit because he could use his talents there almost immediately," Molinari said. "You get the sense that he'd be a major player [in the U.S. Senate] from day one."
Several weeks ago, after the idea of Giuliani running for the Senate was first floated, one of the former mayor's closest associates shot it down.
"He has said time and again that the Senate is not a job for him," said Tony Carbonetti.
"He is a chief executive, and a damn good one."
If elected to the Senate, one source said, Giuliani could use that as a stepping stone to run for President in 2012 - rather than run for re-election to the Senate.
Running for office would mean Giuliani would have to give up his lifestyle: He's a hot commodity on TV talk shows, he rakes in big bucks for speeches and his law firm is doing well.
Democratic consultant Hank Sheinkopf said a race against Gillibrand would be no cake-walk.
She has the ability to raise lots of cash and "she's no Girl Scout. She'll break his back," Sheinkopf said.
A spokesman for former Gov. Pataki, who has been eying a run for U.S. Senate, said Giuliani's decision would have no impact on his decision.
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Former Mayor Rudy Giuliani has decided against running for governor, but is strongly considering running for U.S. Senate instead, sources told the Daily News. 