The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1996, Landmark Communications, Inc.

DATE: Friday, May 3, 1996                    TAG: 9605030558
SECTION: LOCAL                    PAGE: B2   EDITION: FINAL 
SOURCE: BY DAVID M. POOLE AND JON GLASS, STAFF WRITERS 
DATELINE: RICHMOND                           LENGTH: Medium:   99 lines

ALLEN LOSES HIS 2ND AGENCY HEAD IN 2 DAYS

Gov. George F. Allen lost his second agency director in as many days Thursday when Peter W. Schmidt announced he is leaving the Department of Environmental Quality.

Allen said he was not concerned about a recent handful of top-level resignations, including that of William C. Bosher Jr., the superintendent of public instruction.

``It goes with the territory,'' said Allen, who has passed the halfway point in his four-year term.

Schmidt led DEQ during the most tumultuous period in the agency's history. The former cement-block executive's task was to bring Allen's business-first philosophy to an agency where many employees saw themselves as environmental watchdogs.

The philosophical change created massive morale problems. It also led a majority of DEQ employees, surveyed by a legislative audit group, to say they feared for their jobs if they made a decision that upset regulated industries.

Thursday, Schmidt said that the agency has turned the corner on morale and that evidence of improved air and water quality across Virginia proves that critics' fears are overblown.

Schmidt won praise for his fair-mindedness, even from those who decry the Allen administration's environmental policies.

``He was accessible and easy to deal with on differences of opinion. From that standpoint, I am sorry to see him leave,'' said Kay Slaughter, with the Southern Environmental Law Center in Charlottesville.

Some DEQ employees say there was a faction within the agency that came to see Schmidt as a fall guy for the secretary of natural resources, Becky Norton Dunlop.

``We'd rather see Dunlop go than Schmidt,'' said one permit writer. ``Dunlop is the administrator with the agenda.''

A report by the Joint Legislative Audit and Review Commission criticized Dunlop for interfering in the daily management of DEQ.

It was Schmidt, not Dunlop, who appeared before JLARC earlier this year to answer the report.

``Becky hung him out to dry,'' said Patti Jackson, director of the Lower James River Association. ``He was sent out there to do the dirty work and take the heat. Everyone knew he was just following orders and that Becky was calling the shots.''

Schmidt's departure gives Dunlop a chance to consolidate her control over DEQ. Allen named Dunlop's deputy, Thomas L. Hopkins of Roanoke, to head the agency.

``I hope this doesn't mean the department will become more ideological,'' Slaughter said.

Schmidt, one of Allen's college rugby pals, said he looked forward to spending more time with his wife and three children in Virginia Beach. ``I'm going to go to soccer practices for a while, and then make a decision about what to do next,'' he said.

Schmidt has the option of buying back into his old companies, Allied Concrete Co. of Suffolk and Agglite of Virginia Inc.

Schmidt's resignation follows the departures this year of state Secretary of Health and Human Resources Kay Coles James, constituent affairs director Anne Kincaid and Superintendent of Public Instruction William C. Bosher Jr.

Bosher, who led a move toward tougher academic standards, resigned Wednesday to become superintendent of schools in Chesterfield County. He will begin those duties July 1.

Before being appointed to his current job by Republican Gov. George F. Allen in January 1994, Bosher spent 13 years as superintendent of schools in Henrico County, another Richmond suburb.

The president of the Virginia Education Association, which has sparred with the Allen administration over issues including its refusal to seek federal Goals 2000 money, said Bosher's resignation came as no surprise.

``Dr. Bosher's commitment to public education must have made advancing the current agenda of the Board of Education a source of personal conflict,'' Rob Jones said.

The board this year became dominated by Allen appointees who share his conservative views.

While legislators and educators speculated that Bosher was leaving because of differences with the Allen administration and the board over education policy, Bosher dismissed such talk.

``It's not true,'' he said. ``I strongly support the governor and the work we're doing. Those who might look for causes otherwise are probably not going to find them. I'm leaving because there's an opportunity that is an extremely good one.''

Bosher acknowledged that he and Allen didn't always see eye-to-eye, but he declined to discuss specifics.

``In any environment where people are doing their job, there are differences of opinion, and there have been,'' Bosher said. But he added: ``I'm indebted to the governor for the opportunity . . . and will always appreciate his confidence and support.''

Michelle Easton, president of the State Board of Education, said she was ``a little'' surprised at Bosher's decision. ``He has a good record of achievement, and I'm going to miss him.'' MEMO: Staff writer Cathryn McCue and The Associated Press contributed to this

story. ILLUSTRATION: Photos

First: William C. Bosher Jr., left, head of public instruction.

Second: Peter Schmidt, Department of Environmental Quality. by CNB