Fred LeBrun. Albany Times Union. 1/21/2004.

The state budget Gov. Pataki proposed Tuesday may be the most precarious and illusory in memory.

What comes to mind is an elaborate house of cards resting shakily on a single, vertical joker.

The joker is the state's utter reliance on anticipated revenues from video lottery terminals to underwrite court-mandated school aid enrichment for New York City. The governor states that he expects $325 million in the coming school year and $6 billion over the next five years from those VLTs.

The first of at least three problems with that reliance is that the very legality of those electronic machines is being challenged in court at the moment. And not a far-fetched challenge, either.

There's a good chance the legislation allowing VLTs could be thrown out as unconstitutional. Then where are we?

Attorney Neil Murray, who is arguing against the legality of these gambling instruments, says the case is before the Appellate Division. Whether VLTs will be allowed in Saratoga or anywhere else in New York will likely wind up before the Court of Appeals, and pretty quick.

Off the top, it's mystifying that the state would even contemplate balancing the books on a chancy court decision. Another obvious problem is that should VLTs pass the high court's sniff test, there's still no guarantee predicted revenues will materialize.

Historically, anticipated revenues from gambling sources have always come up short, sometimes way short.

And the biggest problem of all is that even if gamblers contribute every bit of the $6 billion the Pataki budget claims, it's not nearly enough.

"Even if the best-case scenario materializes, it would only give us a third of what the Board of Regents says is needed," says Assembly Education Chairman Steve Sanders. "Relying on VLTs is uncertain, unstable and ultimately insufficient."

Yet the bill will come due to better aid New York City schools whether we have VLTs or not.

The Court of Appeals has given the state until the end of July to come up with a plan. Which means that as the house of cards tumbles, the state may be scrambling in every direction to implement whatever comprehensive school formula changes are eventually adopted. So far, we've only heard rhetoric and make-believe on what those formula changes are going to be.

We're told they'll incorporate some sort of a magical set of numbers and revenue sources that will allow suburban and wealthy districts to maintain the aid they are now getting, at the same time assuring high-risk city districts -- notably New York City -- much more, while not increasing the education funding pot -- read, taxpayer backache -- significantly. There hasn't been a hint offered on how this seeming contradiction will be resolved, except by that joker, the VLT.

Murray's court challenge is not just to VLTs, but also to casinos and to New York's involvement in multistate lotteries. The entire gambling gambit the state is relying on to balance the budget.

Our state constitution prohibits all gambling, with four exceptions. Those exclusions are parimutuel betting on horse racing, lotteries operated exclusively for education in the state, bingo halls and some limited gaming opportunities for not-for-profits.

The constitution does not specifically ban slot machines, as many believe.

So what the state has been arguing, and did so successfully before Supreme Court Justice Joe Teresi, is that video lottery terminals are what the name suggests: mini lottery machines, even though they look and act like slot machines.

To a lay person, this seems like ridiculously tortured logic, but to lawyers it seems a reasonable argument. Now let's see if it can be turned into a solid foundation for a state budget.

Contact Fred LeBrun at 454-5453.