The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1994, Landmark Communications, Inc.

DATE: Wednesday, July 13, 1994               TAG: 9407130422
SECTION: LOCAL                    PAGE: B1   EDITION: FINAL 
SOURCE: BY MASON PETERS, STAFF WRITER 
                                             LENGTH: Medium:   86 lines

GASTON TALKS SET FOR NEXT WEEK TOP OFFICIALS FROM VA., N.C. EXPECTED TO ATTEND MEETING

After 10 years of snarling over the Lake Gaston pipeline, North Carolina and Virginia officials will meet in Norfolk next week for talks designed to bring a new era of regional cooperation, a Virginia Beach state legislator said Tuesday.

Sen. Kenneth W. Stolle, a Republican who represents Virginia Beach's 8th District, said a preliminary Virginia-North Carolina conference on Lake Gaston would be held ``sometime'' during a scheduled Southern Legislative Conference at the Norfolk Waterside Marriott Hotel.

``This first meeting will open doors of communication between the two states,'' Stolle said. ``Virginia will send representatives from the governor's office, the attorney general's office and the Department of Transportation.

``I've discussed this with Gov. (George) Allen in Richmond, and he has emphasized his interest and promised his cooperation.''

In North Carolina, state Sen. Marc Basnight, D-Dare, president pro tem of the state Senate and a close friend of North Carolina Gov. James B. Hunt Jr., said last week that he believed the meeting would be attended by a North Carolina delegation similar to that expected for Virginia.

More than a decade ago, Virginia first proposed an 85-mile, $142 million aqueduct to carry water to Virginia Beach from Lake Gaston, on the Virginia-North Carolina border. From the outset, the engineering proposal has been opposed by various North Carolina administrations.

North Carolina's lawyers repeatedly sought to delay the project with legal arguments that piping 60 million gallons of water a day from Lake Gaston to Virginia Beach would lower the level of the Roanoke River source and harm the downstream environment in North Carolina.

Virginia's attorney general has countered that no such ecological harm would be done.

On June 23, in a major setback for Virginia Beach, the Federal Energy Regulatory Commission ordered a new environmental impact study of the Lake Gaston plan. Virginia Beach has already started preliminary work on the pipeline, but the new survey is expected to delay further construction.

Since April, Basnight has been working behind the scenes to get Virginia and North Carolina representatives together to resolve the Lake Gaston impasse.

Basnight was in state budget negotiations Tuesday and could not be reached for comment on the meeting that Stolle said is set for next week.

Basnight's Lake Gaston role has been difficult because Hunt, his longtime political mentor, has opposed the pipeline, as has North Carolina Attorney General Michael Easley. But the climate in North Carolina began to change this year with the championing by state Commerce Secretary S. Davis Phillips of more interstate ``regionalism.'' Phillips is one of Hunt's closest advisers.

So, three months ago, Basnight began telling political associates that the bickering between Virginia and North Carolina was economically harmful and that it was time to seek a ``neighborly'' settlement of the Lake Gaston pipeline dispute.

``Lawyers shouldn't settle these disputes - neighbors should settle them,'' Basnight said when he proposed the idea of meetings between the two states.

As Basnight recruited Democratic supporters in his state, Stolle moved toward a bipartisan coalition in Virginia that would help Basnight arrange a preliminary meeting.

``We decided that it was time to sit down and talk,'' Stolle said, ``even though we may not even bring up Lake Gaston at this first meeting.''

A key development, intended or otherwise, came when Sen. Jesse Helms, the conservative Republican from North Carolina, released a letter sent to him by Elizabeth A. Moler, head of the Federal Energy Regulatory Commission.

Moler's June 23 letter to Helms described her reasons for ordering the new environmental impact study, and to some Democrats it appeared that Helms was getting ready to declare himself a player in the Lake Gaston game.

``At this point, there is no involvement of the congressional delegations from either state,'' Stolle said.

Helms said he doubted the pipeline ``would stand the test'' of a new environmental impact survey, but he welcomed the additional fact-finding as an aid in resolving regional water problems.

But in North Carolina, friends of Hunt suggested it could be embarrassing if Helms grabbed even a little credit for helping to settle the Lake Gaston dispute with the Republican governor of Virginia.

Hunt's worst North Carolina political defeat came in 1984 when Helms beat him in what was called the ``dirtiest U.S. Senate race ever.'' Hunt waited eight years before re-entering politics and winning his third term as governor in 1992. by CNB