Using the aged Mellon Arena as a backdrop, state Auditor General Jack Wagner said yesterday that the state Gaming Control Board should award the lone Pittsburgh slot machine casino license to a gaming company that promises to fund a new arena for the city.

Mr. Wagner, who called the Pittsburgh license the most valuable in the state, said elected local officials and the community in general need to send Harrisburg the unified message that a successful slots applicant must help the city in its time of economic need. And, he said, that means a new arena funded solely with gaming profits.

Speaking at a news conference, standing in the cold and drizzle outside Gate 3, Mr. Wagner noted that unlike the economic landscape when PNC Park and Heinz Field were constructed, the city and Allegheny County today do not have the wherewithal to help in financing a new arena.

He said a new arena is vital to keeping the Penguins here, as well as providing a necessary, modern venue for concerts, circuses and other forms of entertainment. He said an arena is even more vital to a city's economic health than baseball or football stadiums because it has the potential to be used 365 days a year.

Mr. Wagner said that if a new arena is totally funded by private gaming profits, $90 million in state funds, currently earmarked for arena construction, could be freed up for other economic stimulus projects.

"A new arena is economically vital to Pittsburgh," he said. "I believe it is my responsibility as a Pittsburgher ... and as the fiscal watchdog of the commonwealth of Pennsylvania, to float what I consider conceptually a good idea for Pittsburgh and a good idea for Pennsylvania."

Mr. Wagner said that while there is no legislation requiring an applicant to fund an arena, he believes that with strong local support for his concept, it would be difficult for the gaming board not to award the license to an entity that makes such a promise.

Tomorrow is the deadline for gaming applications, and Mr. Wagner's comments came in the wake of last week's announcement that one applicant, Isle of Capri Casinos Inc., will fund an arena as part of its joint proposal with the Penguins. The gambling operator would supply $290 million for construction of an 18,000-seat arena for hockey, concerts and other events.

Isle of Capri also expects to commit at least another $1 million a year in slots revenue for community givebacks, Tim Hinkley, Isle of Capri president and chief operating officer, said last week.