ALEX GROSS, a developer in suburban Atlanta, is upset.
Five years ago, Mr. Gross's company, Atlanta Suburbia Estates Ltd., bought 150 acres of level land it planned to develop into soccer fields, a lake, and a golf course.
But as workers started digging, the Environmental Protection Agency (EPA) discovered between 20 and 40 acres of the land were in a flood plain. Though the land remained dry most years, at that time it was covered with water from torrential rains that had caused widespread flooding in the South.
The EPA said the area was wetlands and told Atlanta Suburbia it could not develop most of the 150 acres. Now the company is paying $1 million of interest on land it says it can't use and can't sell.
''It is an unbelievable horror story,'' Gross says.
But the tables could turn in favor of developers such as Gross, who complain that the laws regulating wetlands, which fall under the jurisdiction of the Clean Water Act, are too rigid.
A House bill that passed in May and a similar one being considered in the Senate would give a new definition for wetlands, bogs, swamps, marshes, sloughs, prairie potholes, and playas that cover about 5 percent of the landmass in the United States.
Swampy swath in South
Especially in the South, where bayous and swamps cut a wide swath, the legislation could have broad implications. Under the new wetlands definition, an average of 60 percent of every state's wetlands would no longer fall under federal protection. In 16 states, including Georgia, more than 80 percent of wetlands would be removed from protection according to a new survey conducted by the Army Corps of Engineers, with help from the EPA and the Interior Department's Fish and Wildlife Service.
The proposal has created a heated debate between environmentalists and land developers.
Environmentalists argue that redefining wetlands could result in a substantial loss of one of the world's most vital resources. Proponents argue it will streamline a system that is tangled in red tape and help people such as Gross.
''We think [the proposed amendments] would go a long way in clarifying the situation for property owners, builders, people who don't know where they stand,'' says Michael Luzier, director of environmental regulations for the National Association of Home Builders in Washington.
Counters Pam Goddard, associate representative for the Sierra Club in Washington: ''We could wipe out all the progress we've made in the last 25 years.''
Wetlands are important because they purify drinking water, help control floods and erosion, and provide habitat to plants and wildlife, say environmental researchers. The National Academy of Sciences defines a wetland by the vegetative material present, the hydrology of a site, and the soil type.
The definition used by the House and Senate bills is more controversial. It defines a wetland as land that is covered with water for 21 consecutive days during the growing season. The bills would also set up a classification system that would rank wetlands in importance and determine how much protection they get.
Some land designated as wetlands now would have no protection; taxpayers would be required to buy a certain percentage of other wetlands.
Opponents of the legislation say these proposals are an unscientific way to identify wetlands and weaken their protection in favor of industry.
''The reason it's a problem is it eliminates all kinds of wetlands that are very valuable but may not be covered with surface water - mainly flood-plain wetlands or wetlands that are very important in groundwater discharge,'' Ms. Goddard says.
The other side sees it differently. ''What the environmental community likes to argue is that we ought to let the scientists decide what a wetland is. We think elected officials ought to make that decision,'' says Mr. Luzier. ''And any change in definition that reduces jurisdiction does not necessarily equate with loss of wetlands.''
Proponents also favor the legislation because it would put one agency, instead of two, in charge of regulating wetlands, a move that would reduce delays in getting building permits, Luzier says.
Environmentalists, however, contend more bureaucracy would be created because all past permit decisions could be reopened.While the House bill is stringent in its proposed reforms, the Senate bill, will likely be more moderate, many observers say.
''President Clinton has vowed to veto the House bill, so I'm sure the Senate is taking that to heart,'' Luzier says.