Air Force Two, carrying Vice President Bush and his campaign staff home from Cleveland Sunday evening, came dangerously close to a smaller airplane, apparently because of an air-traffic control error, Federal Aviation Administration officials confirmed yesterday.

The planes passed within three-fourths of a mile horizontally and 500 feet vertically of each other, FAA Chief Donald D. Engen estimated in testimony before the Senate subcommittee on aviation. FAA standards require that planes be 5 miles and 1,000 feet apart, respectively.

"At this point, we're trying to gather facts. I would prefer not to assess fault or blame," Engen said.

Another FAA source said, "We blew it."

The FAA classified the incident as an "operational error," regarded as less serious than a near midair collision. It is worrisome in a year in which 17 persons died in one midair collision and several other close calls have been reported.

"We dare not downplay what I think is a serious situation," Sen. J. James Exon (D-Neb.) told Engen. "If it weren't Air Force Two, we might not have heard about it."

"Oh yes, we would have heard," Engen said.

Air Force Two was carrying about 40 persons, according to Shirley Green of Bush's press office. "We were all unaware of it," she said. "There was no evasive action or anything." The pilot was Air Force Maj. Wayne A. Sharkey, who thought the incident serious enough to file a report, an Air Force spokesman said.

According to Engen's testimony and other sources, Air Force Two -- the Air Force version of a four-engine Boeing 707 and so named only because it carried Bush -- left Cleveland for Washington about 6:40 p.m. EDT Sunday and climbed to 8,000 feet.

When a controller at the Cleveland regional center cleared the plane to 23,000 feet, Air Force Two was about 15 miles behind a Cessna 310, a twin-engine propeller plane that can carry five or six passengers. It also was flying southeast, cruising level at 13,000 feet.

As Air Force Two continued its climb, it began to close on the Cessna. Investigators said they do not know whether the controller noticed the potential conflict or was alerted to it by a computer-generated warning.

Whatever the circumstances, the controller ordered Air Force Two to level off at 12,000 feet, after it had already passed that altitude. Air Force Two reached about 12,400 feet before descending, then passed below and to the left of the Cessna.

The controller, Engen said, was a 25-year veteran who had been working his radar screen for seven minutes and, during the incident, was handling four planes, a number generally considered light.

Both airplanes were being directed by controllers, were flying on instruments and electronically reporting their altitudes to the control system.

Subcommittee Chairman Nancy Landon Kassebaum (R-Kan.) asked Engen, "Air Force Two was cleared to go up, and then told to come down. Why?"

"I have to read between the lines," he said. "My interpretation is that Air Force Two did not climb fast enough for the controller to feel he had adequate separation from the other plane , so the controller had him come back."

Sen. Barry Goldwater (R-Ariz.) urged Engen to come up with a definition of "near miss." "I don't think 500 feet and three-fourths of a mile is a near miss," he said. "I've had some scare the living hell out of me, and they were a lot closer."

The hearing had been called to gather information on the air-traffic system and its problems with delays. The Air Force Two incident, however, dominated early testimony.

The National Transportation Safety Board is investigating the incident.