The Alexandria City Council has been bedeviled for several years by a one-block tract in the city's Old Town. Last year, Vice Mayor Patricia S. Ticer (D) remarked that the site seemed to haunt the council.

It's baaaaack.

Last week, a Circuit Court panel set the value of the land -- a parking lot bounded by Lee, Queen and North Union streets and Thompson's Alley -- at $4.9 million. That's about $1 million more than the council wanted to spend to acquire it for a parking garage in the heart of the congested waterfront area.

It's also more than 2 1/2 times the $1.9 million the city sold the lot for in 1985. But the cost of the land has long been going up faster than city officials would like.

In the early 1980s, the city bought the property from the federal government. Initially the price was to be $925,000, but the government increased it to $1.5 million and the city then lost a court battle that added another $400,000 to the cost.

The 1985 sale was to a partnership led by developer Samuel T. Ellsworth, and it figured in a political upheaval. Then Vice Mayor James P. Moran (D) had had dealings with a man who had tried unsuccessfully to buy the parcel. Moran resigned from the council after pleading no contest to a misdemeanor conflict of interest charge involving the land.

Moran came back. He was elected mayor, and his conviction was set aside by a judge who said the city "deserves a mayor now who is not under a cloud." Last month, Moran was elected to Virginia's 8th District congressional seat.

And the Lee Street parking lot is back too.

The $4.9 million figure set by the court as the price of condemning the land for public use may be too high, said City Council member Kerry J. Donley (D).

But no decision has been made on whether to go ahead.

The city has proposed to finance the purchase through a special tax imposed on merchants in Old Town, an area in sore need of parking facilities, and the project still has backing.

"Our initial reaction is that the price falls within our boundary," said Bryan Watson, chairman of the Old Town Business Association. "Retail and restaurant businesses have been hurt" by the lack of parking.