A key finance official in the administration of New York City Mayor David N. Dinkins said yesterday that a plan by Republican mayoral candidate Rudolph Giuliani to change the city's underwriter selection process is "nothing new,' and that the mayor's staff already follows similar procedures.

Michael W. Geffrard, director of the Dinkins administration's Office of Public Finance, also criticized Giuliani for suggesting that the city follow the examples of Kentucky and the administration of former mayor Edward I. Koch when it selects bond underwriters.

"This proposal is not fundamentally different from what the city already uses," Geffrard said. "As far as the mayor's people are concerned, officials from [the Office of Management and Budget] and Office of Public Finance all participate in the process."

Geffrard said these officials "all participate in the [request for proposals] process" as well as in the interviewing of firms applying for the senior manager positions, the most lucrative spots on the city's bond underwriting team.

Giuliani's plan, reported on Friday in The Bond Buyer, calls for the creation of a panel of finance professionals to choose bond underwriters.

The panel would include deputy mayors, the city's budget director, and other officials, and would select securities firms based on a ranking system, Giuliani said. The mayor would have final approval of the underwriter picks, he said.

Giuliani said that the plan is modeled after the underwriter selection process used by Kentucky's Office of Financial Management and Economic Analysis. He said a similar method was followed by Koch.

Giuliani said the changes are needed given the recent findings of a city investigation into City Comptroller Elizabeth Holtzman's recommendation of Fleet Securities as a co-manager in the city's bond syndicate.

Both the mayor and the comptroller make underwriter selections. Fleet was recommended by the comptroller's office and ultimately approved by Dinkins, seven months after Fleet's banking affiliate made a $450,000 loan to Holtzman's failed U.S. Senate campaign in August 1992.

The city's Conflicts of interest Board is reviewing the matter for possible city charter violations. Press and finance officials representing Holtzman did not return telephone calls yesterday.

"There was a reason why these questions did not occur in the Koch administration, but now we have a myriad of questions under the Dinkins and Holtzman administrations." Giuliani said.

Geffrard said that Giuliani should think twice before modeling his plan after Kentucky or the system used by Koch. "The Kentucky reference is ironic since there's a very active investigation going on there," Geffrard said.

A federal court is hearing charges that Bill Collins, the husband of former Kentucky Gov. Martha Layne Collins, extorted campaign contributions from investment firms in the early 1980s in return for municipal bond business. However, the rules advocated by Giuliani were implemented after the alleged extortion took place, partly in response to the charges.

In terms of Koch's selection of underwriters, Geffrard said the former mayor relied largely on one firm, Goldman, Sachs & Co., to sell most of its debt as a senior underwriter. The city currently employs seven senior underwriters, which handle the bookrunning responsibilities on a rotating basis.

In response to Geffrard's comments, Richard Bryers, a spokesman for the Guiliani campaign, said: "There are a variety of ways to do this. Rudy has a proposal to deal with the problem. If they are satisfied with the current system, that's their call."

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