The Meadow Outdoors Foundation on Tuesday unanimously rejected a proposal by the Virginia Gold Cup Association for a seven-year extension of the association's lease at Great Meadows in The Plains. On Thursday, the foundation presented a counterproposal described by association President Melville Church III as "unacceptable," leaving the future of the prestigious Gold Cup races still in doubt.

Those familiar with the negotiations said the chief dispute is less over the terms of the lease than over who has control of decisions affecting the races.

Since 1983, the association has leased about 108 acres at Great Meadows from the foundation to run the Virginia Gold Cup in May and the International Gold Cup in October. It also uses 72 adjacent acres owned by Arthur W. "Nick" Arundel, who serves on the board of both organizations but recently resigned as chairman of the spring races.

The events draw tens of thousands of spectators to the course off Route 17 in northern Fauquier County. The 1999 International Gold Cup will go on as planned Oct. 16 because it is covered by the current lease, which will expire at the end of the year.

Church said the foundation's rejection of the association's offer came as a surprise because he thought that the differences had been worked out during two years of haggling. He said the association will begin considering alternate proposals immediately but has set no timetable.

Some sticking points in the negotiations, according to participants, include the association's insistence that if the foundation cancels the lease, it must wait seven years before holding another certified steeplechase race there. The foundation wants a three-year lockout provision.

Another bone of contention is how much money the Gold Cup guarantees will go to the Meadow Outdoors Foundation.

That has been a chief concern of Arundel, the multimillionaire chairman of Herndon-based ARCOM Publishing, who has a large role in the current disagreement. He said recently that he was dissatisfied with the amount of money the association was giving for the maintenance of Great Meadows and the fact that it recently began giving to other charitable causes. He cited those factors when he resigned last month as chairman of the Virginia Gold Cup.

Arundel can effectively veto any decision by either organization because his private lands are required by zoning laws for the running of the races.

Robert Banner Jr., publisher of The Chronicle of the Horse and a member of the Meadow Outdoors Foundation board, said that the dispute, although "wearisome," did not appear to seriously jeopardize the event. "There are a lot of personalities involved among horseman, and they like to go back and forth," he said.