12/09/2003 1:00AM

Foes try to stop N.Y. slots

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TUCSON, Ariz. - New York racing interests will be closely watching the developments inside a New York appeals court next Tuesday when a challenge to a bill that legalized slot machines at state racetracks will be heard, said racing officials at a gaming conference in Tucson, Ariz., on Tuesday.

The challenge has been lodged by opponents to the 2001 slot-machine bill, which authorized a type of slot machine, called a video-lottery terminal, at two Thoroughbred tracks and six harness tracks in New York. The challengers, who are led by Cornelius Murray, a New York lawyer, argue that the law violated the state constitution's prohibition on nearly all forms of gambling.

Arguments in the case will be heard Dec. 16 in the state's intermediate appellate court. A decision is expected in February, according to Bennett Liebman, the coordinator of the Racing and Wagering Law Program at the Albany Law School. Liebman said that reading the court's leanings is difficult due to the vast amounts of money that the slot machines are expected to raise for the state's education fund.

"There's a general belief out there that the court will try to its utmost to find this constitutional because the revenue need for governments is so great," Liebman said. "But it's not a slam dunk for constitutionality."

If the appellate court rules that the legislation is unconstitutional, the decision would jeopardize millions of dollars in investments that many New York tracks have already made in renovating their aging facilities to accommodate the machines. However, industry officials said any decision striking the law down would likely be appealed to the state's highest court, the New York State Court of Appeals.

Since the legislation was passed, no racetrack has received a license to operate slot machines. The tracks initially balked at operating the machines because they objected to the way revenues from slots would be distributed. The law was tweaked earlier this year, however, to give the racing industry more money, which has led several tracks to begin ambitious renovations aimed at early 2004 openings.