PORT-AU-PRINCE, Haiti -- Rene Preval was declared the winner of Haiti's presidential election yesterday under an agreement between the interim government and electoral council, staving off a crisis over last week's disputed vote.

With nearly all ballots counted, Preval had been just shy of the 50.1 percent margin needed to avoid a runoff.

Under the agreement, officials decided early yesterday to divide the 85,000 blank ballots cast in the Feb. 7 election among the candidates in proportion to the percentage they had already won. That gave Preval a 51.15 percent majority, said Michel Brunache, cabinet chief for interim President Boniface Alexandre.

The blank votes represented about 4 percent of the estimated 2.2 million ballots cast.

"We acknowledge the final decision of the electoral council and salute the election of Mr. Rene Preval as president of the Republic of Haiti," Prime Minister Gerard Latortue said by telephone after the agreement was made.

Haitians celebrated in the street yesterday as word of Preval's win spread.

"I'm so happy because we have what we were looking for," said Elvia Pressoir, 36, who clutched Preval campaign leaflets while waiting outside the house of Preval's sister for the winner to appear. "With Preval, we'll have security, jobs, and life will get back to normal."

The agreement, which Brunache said was signed by members of the electoral council and several government ministers, came during a meeting of government and election officials late Wednesday night in the electoral council offices.

Leslie Manigat, another former president who came in second with about 12 percent of the vote, accused election officials of breaking the rules to give Preval a first-round victory instead of forcing the two into a runoff. He would not say whether he would register a formal complaint.

The agreement capped a dramatic nine days since Haitians turned out in droves for an election seen as crucial to avoiding a political and economic meltdown. At least one Preval supporter died in massive street protests against alleged fraud, though the demonstrations were mostly peaceful.

On Tuesday, Haitian TV reported the discovery of ballots discarded in a garbage dump near the capital. Reporters visited the site Wednesday and saw thousands of ballots, some marked for Preval, deep in the dump along with a vote tally sheet and four bags meant to carry returns from the election.

The discovery troubled U.N. officials because the bags were not supposed to be thrown out. U.N. official Catherine Sung, an electoral adviser at the vote tabulation center, said that the signed bags were meant to contain annulled and blank votes. An additional 125,000 ballots also were declared invalid because of irregularities, further fueling suspicions of fraud.