The Alexandria City Council will be asked tonight to approve a long-term lease of a structure regarded by some as a jewel of the city's heritage -- the long-neglected 1785 Alexandria Academy, which George Washington helped build and which became the foundation of the city's public school system.

The 3 1/2-story Georgian building at Washington and Wolfe streets, where Washington annually paid the tuition of 20 poor children and which he later endowed in his will, is one of the few 18th century school buildings still standing in Virginia. Robert E. Lee graduated there in 1824.

The city has had the Academy on the market for sale or lease for more than a year, but Mayor Charles E. Beatley said yesterday it is now unlikely the council will want to sell the building.

"It's possible we may agree to a lease. Our primary concern is to save the building, which needs a lot of work," said Beatley.

City planners, who favor leasing the building, estimate restoration costs at $300,000 to $500,000. City historic preservation groups, which have unanimously opposed selling the Academy, now largely favor the proposed long-term lease.

"We don't have a specific use for the Academy and we don't have money to restore it in the city budget," Beatley said. "You're talking big money with restoration."

The real estate firm of Manarin and Odle, which has offices next door in a building formerly owned by the Chamber of Commerce, has offered to buy or lease the Academy building and restore it.

Leonard L. Manarin said yesterday, "we understand many are opposed to the city selling the building. I think I'm opposed, too." His firm, one of the city's largest real estate brokers, would restore the building according to strict historic-preservation guidelines for use as its corporate headquarters, Manarin said.

It would be open regularly to the public, he said, and would revert to the city at the end of a long-term lease, which could be "30 to 60 years" or any length of time negotiated with the city.

Manarin said if a lease is approved he hopes the building's restoration "could be completed in time for a 200th birthday celebration next year."

The Academy, with its 18th, 19th and 20th century additions, is set back from Washington Street and partially hidden behind huge trees. It has been used for school classes off and on for most of its 199 years, and was cited by the U.S. Department of Interior in the 1930s as probably the oldest free school in America still in service. The last school classes were held in it in 1953.

The Academy was vacant for the next 10 years and from 1963 to 1982 was a school administration building, as was the Alexandria Community Y building next door. For the past two years it has again been vacant.

Just before the Academy's cornerstone was laid on Sept. 7, 1785, Washington wrote to a friend he was "convicted that the success of democracy depended on wide spread education."

The Academy's classes -- English School on the first floor and Learned Languages on the second -- not only included prominent and poor families of Northern Virginia but permitted girls on the understanding they would "give place whenever there . . . be applications for admittance on behalf of Boys." The restriction on girls was eased in 1812 when relative Elizabeth Washington bequeathed funds for education "of such poor girls as they think proper."