The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1995, Landmark Communications, Inc.

DATE: Friday, June 30, 1995                  TAG: 9506300465
SECTION: LOCAL                    PAGE: B1   EDITION: FINAL 
SOURCE: BY KAREN WEINTRAUB, STAFF WRITER 
                                             LENGTH: Medium:   90 lines

LAKE GASTON PIPELINE DEAL BEACH, N.C. STILL WORKING AT SOLUTION

Stymied by partisan politics in Richmond, Virginia Beach and North Carolina officials Thursday tried to work out a Lake Gaston deal that wouldn't require a special session of the Virginia General Assembly.

Today is the deadline for a deal worked out this week to be approved by legislators in both states, but it could be extended if both sides agree.

Negotiators have a little more time than expected because the North Carolina legislature failed to reach a budget accord. Instead of adjourning on schedule today, legislators there may remain in session for 10 to 14 days longer. Gov. George F. Allen's office and Beach City Manager James K. Spore both issued statements Thursday saying they are working together with North Carolina to come up with a new solution to the 12 1/2-year Gaston dispute.

North Carolina has repeatedly challenged Virginia Beach's efforts to draw water from the lake, which straddles the state line, arguing that it would damage the environment and economy of surrounding areas.

Squabbles between Allen, a Republican, and the Democratic leadership of the General Assembly undermined the tentative pact this week. Allen decided Wednesday that he would not call a special session of the legislature to consider the agreement, which was negotiated by his office, Virginia legislators, North Carolina, Virginia Beach, Norfolk and representatives of big business in Southside Virginia.

Allen had demanded that the session be focused solely on Lake Gaston and last only until today. Democratic legislative leaders agreed to limit the scope of the session, but they refused to allow Allen to set the timetable.

Neither Virginia Beach nor North Carolina officials would discuss the avenues for compromise being explored, but the previous settlement will probably be a blueprint for any new one.

Most of the provisions agreed to in that accord do not need the approval of the Virginia legislature, although North Carolina had insisted on such support.

Virginia Beach, for instance, could agree, without the General Assembly's permission, to several of the pact's key provisions: maintaining water conservation efforts; limiting water use during severe droughts; contributing money for economic development around Lake Gaston, and limiting Gaston water use to South Hampton Roads.

What it can't do is give North Carolina the legal assurance that this is the only time southeastern Virginia will try to tap the lake water.

Norma Ware, general counsel for Marc Basnight, the president pro tem of the Carolina Senate, said Thursday that she and North Carolina's Gaston negotiators were still considering whether to try to get North Carolina legislative approval for the derailed settlement even though it won't go before the Virginia legislature this summer.

The settlement reached earlier this week expires tonight at midnight. If that deadline were extended by both sides, the North Carolina legislature might consider the deal, Ware said.

``My sense is North Carolina would be agreeable to that,'' Ware said. ``If that deadline were extended, that would be very helpful to us.''

Although there is plenty of opposition to the pipeline in North Carolina, the political battle is expected to be easier there than it was in Virginia. Most North Carolina leaders seem convinced that they are better off accepting a settlement they helped negotiate than relying on a court for protection.

The specter of renewed legal battles between North Carolina and Virginia Beach remains, but negotiators on both sides say it is hard to envision going back to war against people who have become colleagues during the six-month process of working out a compromise.

What could drive them back to court is a decision by the Federal Energy Regulatory Commission, expected by July 12, that clearly renders one side a winner and the other a loser.

The commission, the last federal agency that must sign off on the 76-mile pipeline, could give Virginia Beach all the water it wants, prohibit the project or place limits on withdrawals.

A commission study, assessing whether the pipeline would damage the environment around the lake or in the Roanoke River Basin, could be released as early as today. A draft of the study said the pipeline would have no adverse environmental effects.

The commission, which regulates Lake Gaston because it is a hydroelectric reservoir, could also impose some of the requirements worked out in the settlement.

John Bickerman, the lawyer who mediated North Carolina and Virginia Beach's first try at a settlement, is still confident the two sides will be able to reach an accord and avoid a return to litigation.

``I've been talking with the parties constantly,'' he said Thursday. ``I'm still optimistic that they'll work something out. They have a strong desire to reach a negotiated settlement, and that's certainly preferred to the alternative.''

KEYWORDS: LAKE GASTON WATER SUPPLY PLAN by CNB