-- The relocation of the Montreal Expos is baseball's "number one priority" and the owners are resolute that Major League Baseball will relinquish control of the club after next season, baseball's second-highest ranking official said.

Robert DuPuy, president and chief operating officer of Major League Baseball and a member of a recently formed relocation committee, said a decision on where to move the Expos is likely as early as July next year, with the team slated to begin play in a new city in 2004.

Last January, Commissioner Bud Selig called the Washington area "the prime candidate" for a relocated franchise. Selig did not return phone calls today, but his spokesman, Richard Levin, said Selig "has never refuted that statement."

In a highly unusual move, Major League Baseball purchased the Expos from owner Jeffrey Loria for $120 million last year. Baseball's ownership "was never intended to be a permanent situation," DuPuy said during an interview at baseball's annual winter meetings. The Expos, he said, have cost baseball's 29 other teams "a substantial amount of money," a burden the owners appear increasingly unwilling to bear.

Three groups in the Washington area have expressed interest in purchasing the Expos and moving them to the area. The other leading candidate is believed to be Portland, Ore.

Baltimore Orioles owner Peter Angelos has repeatedly expressed his opposition to a Washington area franchise, arguing that it would siphon significant numbers of Orioles fans, and baseball is facing a lawsuit from former Expos minority investors that could potentially delay or block the team's move.

However, baseball's push to move the Expos appears to be gathering steam. Two knowledgeable baseball sources, neither directly involved in the relocation process, predicted an Expos move to Washington is a virtual certainty. The sources predicted that baseball ultimately will reach financial settlements with Angelos and the minority investors, paving the way for the move.

The Post reported in today's editions that baseball invited government officials from several jurisdictions -- including the District and Northern Virginia -- to meet with the relocation committee as early as February.

DuPuy declined to disclose the cost of running the Expos so far, but the issue of the club's finances has brought the winter meetings to a virtual standstill. Selig, who acts as Montreal's de facto owner, recently capped the team's payroll at $40 million, forcing the Expos to shop their most talented players, including outfielder Vladimir Guerrero and pitcher Bartolo Colon.

Trades and free agent signings have slowed as teams line up hourly seeking deals with Omar Minaya, the Expos' general manager. The MLB-imposed budget has frustrated player representatives who believe the commissioner's office has been able to use the Expos to keep free agent salaries artificially low by making their players available as alternatives.

"It has clearly affected the free agent market," said agent Seth Levinson, who represents outfielder Cliff Floyd. "It is clear there are going to be trades [by the Expos] which have been mandated by Major League Baseball, and that the team with the best offer can get any player of their choosing. As a result, by adding quality players to the market, it will slow down considerably the free agent market."

The Expos have exhausted their share of baseball's credit line, believed to be close to $75 million, according to sources. The team is scheduled to play 22 games in San Juan, Puerto Rico, next season, but baseball officials estimate that those games will net the team less than $8 million in additional revenue. Unlike other teams, which can go over budget to sign a player with ownership approval, the Expos can extend their payroll only after consultation with the other clubs or a unilateral league-wide assessment by Selig. Both scenarios appear unlikely.

Minaya, whose daily movements are tracked like the weather here, said he asked the Expos' president, Tony Tavares, immediately before the winter meetings whether there was any chance the team's payroll could increase above the allotted figure. Tavares, who, according to DuPuy, speaks directly with Selig, said he had been told no. Selig is not attending the meetings.

As of early this evening, Minaya said he had spoken with 20 teams, including the Orioles, and had received "20 different potential offers." He said he would be meeting with several teams late into the night.

"I have had things where I was close to saying 'yes,'" he said. "That being said, I'm not going to say yes to team six, when I still haven't met with teams eight, nine and 10."

DuPuy said the Expos' budget had actually increased. "Omar will have more money to spend this year on payroll than last year, and not all GMs can say that," he said.

In fact, the Expos' budget increased from about $38 million last year to $40 million. However, four Expos are eligible for arbitration, and it is estimated it would take a payroll in excess of $50 million to keep the roster intact. Colon, who earns $8.2 million, and Guerrero, who earns $11.5 million, are eligible for free agency after next season.

Baseball's relocation committee is scheduled to meet during owners meetings next month in Scottsdale, Ariz. Despite the timetable outlined by DuPuy, the move still faces considerable obstacles.

A group of former minority investors in the Expos has sued DuPuy, Selig and the team's former owner, Loria, alleging that they participated in a "conspiracy to eliminate major league baseball" as part of baseball's aborted plan to fold two teams last year.

The suit, which was filed in a federal court in Miami last July, has been submitted to arbitration, and the former Expos minority partners are expected to seek an injunction preventing the team from moving.