All not lost for Catskill gaming.

The hopes for gambling in the Catskill region are now centered on Monticello Raceway, which could, with the partnership of Native Americans, be turned into the Downstate area's only casino.

Yonkers Raceway owners, however, have decided to sell the 97-acre site to the highest bidder as soon as possible, as the harness racing track is losing $400,000 a month. Nevertheless, it employs 1,400 people; brings the state $4 million a year in tax revenue; Westchester County about $322,000 in taxes; and the city of Yonkers nearly $1.5 million in various taxes, including Off Track betting surcharges and admissions taxes. No broker has yet been chosen, said Assistant General Manager Denis Moran.

There was also no joy in Catskill last week. The secretary at the Concord Hotel was practically in tears, and a terrible emptiness was felt through the surrounding villages, mountains and valleys.

The Senate had just overwhelmingly voted down a bill that would have removed one more hurdle from a unlimited number of casinos being opened in the three counties comprising the Catskills, along with one each in Niagara Falls, Saratoga-Lake George and Buffalo.

The nay vote also prevented the legalization of slot machines, which could have been then installed at Yonkers and Monticello Raceways.

"How could they do that?," asked the secretary. Her bosses, the Parker brothers, were still in Albany, having tried to the very end to sway State Senators that the seven remaining Catskill hotels were in dire need of an economic boost.

On his return to the resort, Robert Parker said he was "highly disappointed" about the 41 to 19 vote that, without some legal loophole being found, would effectively eliminate gambling from coming before the voters as a statewide issue until 1999.

New York City Mayor Rudolph Giuliani and other legislators had lobbied against any bill, which did not include New York City. Nassau leaders rallied against any bill because it might eat into their off track betting receipts, and religious leaders, particularly from Saragota, took to the pulpit to decry any gambling at all.

Still, champagne was hoisted in Atlantic City and a pall was lifted from the Statehouse in New Jersey, as its casino operators had bet heavily that the neighboring state would not succeed.

Casino owner Donald J. Trump said, "It's good thing that they voted it down because it would have been a very bad thing for New York." Nevertheless, if gambling is ever legalized in the State, Trump would ensure he owned the largest.

Chris Godek, a spokesperson for the city's Hotel Association, said they took were "adamantly opposed to say legislation that didn't include New York City."

Meanwhile, the Oneida tribe runs the Turning Stone casino in Northern New York and is casually scouting the Catskills. A gambling boat is operating out of Sheeps-head Bay and another cruise will debut in the summer from a Midtown Hudson River pier. And a few hours east, there are two Native American casinos clustered in central Connecticut: Foxwoods and Mohegan Sun.

The Catskills have lost countless jobs, however, as tourists found other, more exotic, places to go. One by one many of the resort hotels have closed, and others are dark for several weeks a year.

Occupancy for the Concord is currently about 40 percent, said George Parker. By comparison, New York City hotels had an 80 percent occupancy rate last year, and in the depths of the 1991 depression, occupancy was below 70 percent.

Several city developers, including Joshua Muss - who has a piece of the former grande dame, Grossinger's - took positions or options on Catskill land and resorts, hoping to cash in if the casino bills passed.

Luckily for the Catskills, "Plan B" is at hand. For about the last year, Monticello Raceway, owned by the Catskill Development Company, has been working with the St. Regis Mohawk tribe and the 33-member Sullivan County Casino Advisory Board to turn 30 acres of the 240-acre raceway into an entertainment retail complex with a centerpiece casino attached to the raceway's grandstand.

And the morning after the Senate vote, Catskill Development's phone was ringing with a steady stream of U.S. officials, legislators and area business people who were calling to ensure Plan B was literally on track.

"Now we are the white knight," said a partner who declined to be identified by name. The casino, he said, "will be one of the largest in North America, with over 130,000 square feet on the main floor."

Raceway president Cliff Ehrlich, who is a partner in Catskill Development, says the complex will be a "totally integrated facility with seamless continuity."

There will be 24,000 square-feet of poker, a 25,000 square-foot bingo area, a multipurpose entertainment room, and space for retail outlets, restaurants, youth care and a show lounge.

The current 182,000 square-foot grandstand building would be cut in half. The Mohawks would have one half, find the back side would be expanded with the casino. The pari-mutual sites would not be operated by the Native Americans.

"If we had approvals, we could be in the ground tomorrow," said the Catskill Developer. Those still have to come from the Federal Dept. of the Interior's Bureau of Indian Affairs, which has had the application for over a year, but is expected to take it up more quickly and seriously now that private casinos cannot be constructed.

Any casino would also have to be approved by Governor George Pataki. After last week's vote, his stance has softened, aides said, and would probably approve of a casino, but they add the governor's office is also negotiating with both tribes.

"We are negotiating with the members of the various nations on a number of different issues and hope to have resolution in the near future," said Mike McEwen, a spokesperson for the governor. "I don't know that we're concentrating on a specific site [in the Catskills], but are trying to resolve a host of issues in a comprehensive way. That area is an area that's been talked about for some time [for an economic boost from casino gambling] and we are aware of that."

Sources indicate that the state's hope is that by giving the Oneidas approval for a casino in the Catskills, the state can obtain concessions from the Oneidas on other issues, including land claims near Syracuse and taxes on reservation liquor and cigarette sales.

Would the governor force the Oneidas onto the raceway owners? Ehrlich responded, "I don't think he'll say that."

But McEwen said, "I'm not going to rule that out."

Nevertheless, the Sullivan County Casino Advisory Board group had once talked with the Oneidas, but now have an memorandum of understanding with the St. Regis Mohawks for a casino at the raceway.

"We hope to build the St. Regis casino st Monticello Raceway," Ehrlich said.

Other area sources indicated the Oneidas as yet have no location or deal in the Catskills, have made no financial commitments, and have made no application to the Dept. of the Interior.

The Ehrlich family is also reinvesting in the Catskills, with the re-opening of the 422-room Pines at the end of March after a kitchen roof collapsed last year. The $5.5 million renovation includes a new, separate Kosher kitchen and dining room that will enable them to service non-Kosher clients for the first time.

"As an owner of the Pines, I'm disappointed in the Senate vote," said Ehrlich. "Even as a Catskill Developer, I'm disappointed because the vote would have allowed slot machines. We have to move on as a county and that's what we're doing."

Although there are some Assembly Members who are trying to reopen the issue, the raceway,s casino is expected to be open well before the State's voters could approve a referendum.

If the area's resorts like the Pines, the Concord and the Nevele can hold out until that opening, they expect they will be able to fill their rooms with guests who can then be easily shuttled to the racetrack.

And, says the Catskills Development partner, gleefully cheering the one-hourish ride from New York City, "We'll get the buses from New York."