12/19/2001 1:00AM

New York pencils in OTB sale


The New York City Council voted Wednesday to approve a 2002 budget that includes $250 million in revenue from the sale of New York City Off-Track Betting Corporation. The approval has not, however, increased enthusiasm at the state level to sanction the sale, legislative leaders said.

The council's approval will put the sale on the books for 2002, even though state approval is also necessary and by no means assured. In fact, legislative leaders said Wednesday that the sale will likely have to be green-lighted by Mayor-elect Michael Bloomberg next year before the state legislature agrees to consider the proposal. The sale was approved by Mayor Rudolph Giuliani this summer.

"We think it is more appropriate for the next mayor to take a look at it," said Jackie Fierro, a spokeswoman for Sen. William Larkin, the chairman of the Senate Racing and Wagering Committee.

"We have to give him the opportunity to say if he wants to sell it or not."

In August, Giuliani announced that the city had picked a partnership led by Magna Entertainment as the winning bidder for OTB. Since then, the New York Racing Association, which was a partner in the losing bid, has lobbied fiercely to stop the sale.

Citing in part the legislative uncertainties following the Sept. 11 terrorist attacks, Larkin has so far declined to schedule hearings to evaluate the sale. Fierro said hearings could be scheduled in February 2002, at the earliest, depending on Bloomberg's evaluation.

On Tuesday, State Comptroller H. Carl McCall criticized the sale's inclusion in the budget, characterizing the projection as one of several examples in which the city was overestimating revenue. McCall is running for governor next year.

Jake Lynn, a spokesman for City Council speaker Peter Vallone, who ran unsuccessfully for mayor this year, said Wednesday that Vallone also had questions about the sale.

"If it doesn't get approved by the state, that certainly leaves a hole in the budget next year," Lynn said.