December 2, 1992

WHEN Lenda Murray struts into a weight-lifting room, grown men freeze in mid-grunt. Those lats!

After years of effort to transfer Government work to private companies, the White House acknowledged today that contractors were squandering vast sums because Federal agencies failed to supervise how hundreds of billions of dollars were spent each year. In a report prepared for Richard G. Darman, the director of the Office of Management and Budget, Federal auditors from the White House and 12 agencies said private companies had been paid for unauthorized and, at times, illegal expenses, including tickets to sporting events, lavish cruises and excessive salaries for executives.

METRO DIGEST NEW YORK CITY FERNANDEZ SUSPENDS DEFIANT BOARD Schools Chancellor Joseph A. Fernandez has suspended a Queens school board that has refused to adopt a multicultural curriculum that, among other things, teaches first graders to respect and appreciate gay people. Mr. Fernandez appointed three executives from his staff to take over the day-to-day operation of District 24 in Queens and to devise, with parents and teachers, a curriculum that includes lessons about gay men and lesbians. A1. FEDERAL PROSECUTOR TO LEAVE POST Andrew J. Maloney, who successfully prosecuted John Gotti this year, is resigning as the United States Attorney in Brooklyn. Mr. Maloney, who has served more than six years in what is usually a four-year position, retained his post longer than usual at the request of the Justice Department. He said he stayed because he wanted to complete "unfinished business" that included convicting Mr. Gotti. B3. DISPUTE OVER CROWN HEIGHTS BEATING A homeless black man was beaten by a group of Hasidic men behind Lubavitcher headquarters in Crown Heights, where blacks and Hasidim have long lived in uneasy coexistence. The police arrested a Hasidic man in connection with the beating. As the police were holding the man, a crowd of more than 200 Hasidic protesters gathered outside the 71st Precinct station house to demand his release, saying that the arrest was motivated by politics. B3. ZUCKERMAN FIGHT WITH UNION INTENSIFIES Mortimer Zuckerman's path toward his planned takeover of The Daily News has grown rockier with a virtual state of war erupting between Mr. Zuckerman and one of the newspaper's unions. Mr. Zuckerman says he is beginning an effort to hire under individual contracts some current members of the New York Newspaper Guild, which represents editorial, advertising and circulation employees, because he has not yet reached an agreement with the union. B3. REGION RAPE CONVICTION IS OVERTURNED The conviction of a man who served 11 years in prison for rape was overturned in a case that lawyers and forensic experts say reflects the increasing use of DNA testing by defense lawyers seeking to have cases reconsidered. Kerry Kotler was freed after a judge ruled that new DNA tests, which were unavailable when Mr. Kotler was tried in 1982, showed that there was more than a reasonable doubt of his guilt. B6. A NEW HEALTH-CARE SYSTEM IN NEW JERSEY Ushered into law with marginal political support, New Jersey's new health-care system has come to life under a cloud of doubt and the threat of protracted legal fighting. With a month to go before the changes take effect, there were rumors today of political deals to make major revisions in the legislation. B6. PREPARING FOR A SPECIAL WITNESS Prosecutors in the Glen Ridge sex assault trial want special courtroom arrangements to provide a nonintimidating atmosphere when the mildly retarded woman central to the case testifies next week. Among the requests: front-row seating for her family and friends, restrictions on movements of defense lawyers, and a half-hour recess after every hour of testimony. B6. Passaic Mayor resigns after conviction. B8. About New York by Michael T. Kaufman B3 Neediest Cases B5 Chronicle B8

Clinton Ethics Rules Delayed The President-elect's aides said they were having trouble writing his Administration's ethics rules. Page B10. Act Now or Pay Later Two Disney executives sidestepped possible changes in the tax laws with a $200 million stock deal. Page D1. 13 Die in Air Force Crashes At least 13 crew members died in the collision of two Air Force planes and the crash of a third. Page B11. DNA Tests in Rape Cases A rape conviction was overturned in a case that experts say reflects the growing use of DNA testing. Page B6. Battle Over a Schoolhouse A black school's move into a white neighborhood in Detroit has led to racial strife. Education, page B12.

Legislative leaders said today that they did not expect to strike a deal this month on a host of transportation financing issues, meaning that fares and renovations on New York City's subways, trains and buses might be held hostage next year to fierce haggling over the state budget. Gov. Mario M. Cuomo and the chairman of the Metropolitan Transportation Authority, Peter E. Stangl, have urged the Legislature to convene a special session this month to deal with the state's complex transportation agenda when it can be considered apart from the budget process. Mr. Stangl, in particular, does not want the debate deferred until next spring, when financing for mass transit could become just another bargaining chip in Albany's annual budget wars. Critical to Constituents Although the state's budget for the 1992-93 fiscal year appears to be in balance, Cuomo administration and legislative budget analysts are projecting a gap of anywhere between $2 billion and $4 billion in the 1993-94 budget. As the April 1 start of the state fiscal year approaches, budget negotiators may look to commandeer any available dollars to help close the gap, including those previously dedicated to transportation improvements.