THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Friday, June 2, 1995 TAG: 9506020532
SECTION: LOCAL PAGE: B3 EDITION: FINAL
SOURCE: BY ALEX MARSHALL, STAFF WRITER
DATELINE: NORFOLK LENGTH: Medium: 72 lines
The city's council and legislators met Thursday to discuss how the city was willing to compromise to help Virginia Beach obtain approval for the Lake Gaston pipeline deal.
At the end of the unusual joint-meeting of the council and delegation at City Hall, the group agreed that Norfolk was still willing to negotiate but said Virginia Beach's ``take it or leave it'' attitude had left talks at a standstill.
``We want to continue negotiations if they think it would be productive,'' Mayor Paul D. Fraim said. ``But we understand they have discontinued negotiations. We want to go back to the table.''
Virginia Beach has not made another offer since rejecting Norfolk's latest proposal on Wednesday.
Norfolk has made a counter-offer, Fraim said, and is unwilling to drop its price further until Virginia Beach replies.
``In effect, we are at a stalemate,'' Fraim said.
Del. Tom Moss, Speaker of the House, said he supports Gov. George Allen's position of not calling a special session for the General Assembly until Norfolk and Virginia Beach have resolved their differences.
``We could be there a week, we could be there two weeks,'' Moss said, adding that keeping the General Assembly in session is an expensive proposition.
Councilmen Randy Wright and Paul Riddick proposed that the Virginia Beach and Norfolk councils meet as a group. Fraim said he was open to such an idea.
``A group like that wouldn't solve the problem, but it might clear the air,'' Riddick said.
The two cities are arguing over how much Virginia Beach should pay Norfolk for agreeing to restrict where it can sell its water. North Carolina insisted on the provision in its settlement with Virginia Beach.
Fearful of losing money from potential water sales, Norfolk has insisted on some sort of compensation. Virginia Beach has agreed to buy or reserve some of Norfolk's surplus water. The two cities are now arguing over price and quantity.
In its last offer, Virginia Beach proposed paying 60 cents per 1,000 gallons and buying up to 12 million gallons a year.
Norfolk accepts this price and quantity, but wants to include an annual inflation figure. It also wants Virginia Beach to buy a larger quantity of water for a transitional period.
The offers are farther apart then they sound: Virginia Beach is proposing to pay more than $80 million over the next 35 years, while Norfolk is requesting about $200 million over the same period.
The cities are struggling to meet a June 27 deadline. The proposed deal between North Carolina and Virginia Beach expires after this date, unless the parties agree to extend the deadline.
Despite the apparent stalemate, Moss said he expected negotiations to proceed in some fashion.
``I've been in this business a long time, both as a lawyer and a legislator,'' Moss said. ``Everything is on the table.''
Moss said Virginia Beach was ``immature'' for telling Norfolk that its last offer was its final one. The legislator compared it to a client in a lawsuit who forces a case to go to trial instead of working out a settlement.
Norfolk is also concerned about language in the agreement that endorses a regional water authority. Councilman Mason C. Andrews said he favored a regional water authority, as long as some way is found to compensate Norfolk for its water system and resources, which make up the bulk of the region's water supplies.
KEYWORDS: LAKE GASTON PIPELINE SETTLEMENT AGREEMENT by CNB