January 6, 1998

SBC Communications Inc, parent of Southwestern Bell and Pacific Bell, to acquire Southern New England Telecommunications Corp (SNET), local telephone company serving 2.2 million customers in Connecticut, for $4.4 billion in stock; deal would create one of largest local non-Bell phone companies and will relocate headquarters of Connecticut carrier from New Haven to San Antonio; SNET agreement seen recognition by that carrier of breakneck consolidation in industry and realization that it was too small to be financially viable; after the merger, most Connecticut residents will see little change in their day-to-day workings of telephone system; SBC will continue to operate under SNET name in Connecticut and companies say none of SNET's 9,700 employees will lose their jobs (M)

Beginning today, Business Day is reorganizing its coverage of the markets for easier reading; new format will appear Tuesdays through Saturdays (S)

Mayor Rudolph W Giuliani indicates for first time that he might not sign legislation that would give New York City one of most restrictive bans on outdoor tobacco advertising in country; says he agrees with general goals of bill, which would outlaw tobacco advertisements within 1,000 feet of schools and playgrounds, but has doubts about its constitutionality (M)

Grateful Dead continues as commercial enterprise despite death of Jerry Garcia under aegis of Grateful Dead Merchandising, which every day ships a thousand packages of Grateful Dead merchandise from warehouse in Novato, Calif; most of revenue coming in is earmarked for Terrapin Station to be built in San Francisco, a $60 million museum, amusement park, gathering place, concert hall, research center and possibly even a hotel; photos (M)

Ford Motor Co will begin selling sport utility vehicles and Windstar mini-vans that produce as little air pollution as cars; Chrysler, after initially expressing reservations, says it will match move in its most popular sport utility vehicle; Ford will install larger and more effective catalytic converters and fine-tune engines so all 1999 sport-utility models, or nearly a quarter-million vehicles, emit roughly 40 percent less pollutants that comparable 1998 models; Chrysler says all 1999 Jeep Cherokees and Grand Cherokees, which will have new engine designs, will be as clean as Ford's (M)

O'Day Dances, new dance company founded by Kevin O'Day, choreographer, and John King, composer, is about to make world debut at Joyce Theater as part of Joyce's Altogether Different festival; photo; Ronald K Brown's Evidence dance company is among others performing at festival; photo (M)

Washington Wizards defeat New York Knickerbockers, 113-106; photo (M)

Pres Clinton says he will propose balanced Federal budget for 1999, three years ahead of schedule, signaling halt and perhaps end to deficit politics that have confined dreams of generation of Presidents and lawmakers; predicts deficit in 1998 will fall to less than $22 billion; credits hard work and productivity of American people as well as his own policies; cautions against using projected future surplus as pretext for returning to failed policies of past; House Speaker Newt Gingrich, who weeks ago urged Clinton to propose balanced budget for 1999, also cautions policy makers to keep budget in surplus once balance is achieved; budget was last balanced in 1969; photo (M)

NEW TODAY The Times today introduces Public Lives, a daily profile and personality roundup, on page B2 Tuesdays through Fridays. Today: Lorna J. Wendt, the former wife of a corporate executive who made divorce a battleground for equality of the sexes. The Metro Section, page B2. THE MARKETS The Times is reorganizing its coverage of the markets for easier reading. Business Day, pages D6- 7.

Margo Jefferson Arts in America column discusses black-faced minstrelsy and white-skinned meldodrama, theatrical forms that were once adored, then debased, and finally discarded, in light of Uncle Tom's Cabin or Life Among the Lowly, new play that takes up these forms and applies them artfully to Harriet Beecher Stowe's novel; photo of David Wheir, Stacy Highsmith and Noel Robichaux (M)

Trial of Unabom suspect, Theodore J Kaczynski, is halted immediately as it begins after Kaczynski complains about his defense team; is continuing to object to efforts to portray him as mentally ill; some familiar with defense suggest Kaczynksi's actions were part of emotional reaction to presence in courtroom of brother, David Kaczynski, who turned him in to authorities; photo (M)

Harvey Araton Sports of The Times column discusses sisters Tamika Catchings, who plays basketball at Tennessee, and Tauja Catchings, who plays for University of Illinois; they discuss their relationship; photo (M)