Jerusalem (CNSNews.com) - Negotiations between Israel and the Palestinian Authority continued Monday, amid controversy over the building of Israeli homes in disputed territory and the ceding of Arab villages bordering Jerusalem to the PA.
President Clinton's special envoy to the talks, Dennis Ross, is due in the region on Tuesday to sit in on the negotiations and offer suggestions as to how the two sides can arrive at the "framework" agreement they are aiming for by the end of May.
Two "final status" issues - Jerusalem and Israeli settlements - were catapulted into the forefront, as talks on a preliminary agreement opened in the Israeli Red Sea resort of Eilat.
PA negotiators complained about the construction of 174 new housing units in the community of Ma'ale Adumim, a large town in disputed territory about eight miles from of Jerusalem.
"Not only are these decisions illegal, and not only do they contradict existing agreements, but they also undermine Palestinian faith in the credibility of the process - and I believe they also harm Israeli public opinion," chief Palestinian negotiator Yasser Abed Rabbo was quoted as saying.
The issue of Israeli settlements in the disputed West Bank is reserved for the final status negotiations. PA Chairman Yasser Arafat wants all Jewish settlements removed from the territories, which he hopes to declare as an independent Palestinian state by the end of the year.
Prime Minister Ehud Barak has pledged to retain blocs of settlements such as Ma'ale Adumim under Israeli sovereignty in a final understanding and has promised to allow them to expand naturally in the meantime.
But the PA fears that settlement expansion now will create "facts on the ground" which will prejudice the eventual outcome of talks.
Although referred to as a settlement, Ma'ale Adumim is a 22-year-old Jewish city and suburb of Jerusalem, with approximately 28,000 residents.
Hizki Zisman, spokesman for Ma'ale Adumim told CNSNews.com that the building in Ma'ale Adumim was approved by the government of the late Prime Minister Yitzhak Rabin.
It has nothing to do with government policy, or the current negotiations, Zisman said. At the end of last week's Passover holiday, the sale of the homes was published, prompting the Palestinians to respond.
But leading Palestinian negotiator Saeb Erekat accused Barak of not "negotiating with the Palestinians, but rather with [Housing Minister] Yitzhak Levy and the National Religious Party."
Both the National Religious Party and the immigrants' Yisrael B'aliyah party have threatened to leave the coalition government if Barak gives in on another sensitive issue - handing over full control of three Arab villages to the PA in advance of the next Israeli redeployment.
"It is proper that the [villages] be under Palestinian security control," Barak told reporters. "This does not weaken Jerusalem."
Currently, the three are under PA civilian control but Israel is responsible for security. Barak is reportedly considering giving the PA full control of the villages as a "confidence building measure" ahead of another redeployment from disputed territory, scheduled for June.
Interior Minister Natan Sharansky of Yisrael B'aliyah told reporters that transferring "Abu Dis and another two villages ... as advance payment means the main course will be east Jerusalem, which we oppose."
The PA wants to claim eastern Jerusalem as the capital of a future state, but Israel has pledged that Jerusalem will never be divided and will remain its eternal capital.
For several years, proponents of the peace process have talked about the idea of giving Abu Dis to the PA as its portion of "Jerusalem." Abu Dis is technically outside the municipal boundaries of Jerusalem.
The PA has completed a building there, which is rumored to have been constructed to house the Palestinian parliament. There are approximately 9,000 residents of Abu Dis, many of whom are Israeli Arab citizens.
Abu Dis lies to the east of Jerusalem, roughly between the Israeli capital and Ma'ale Adumim. It is close to the Old City of Jerusalem, which contains sites holy to Judaism, Christianity and Islam.
Sharansky said it would be a "terrible mistake" to give the PA military control over an area abutting Jerusalem and separating the capital from Ma'ale Adumim. He added that Israelis may have to surrender the area in a final understanding but not prior to that.
A final agreement between Israel and the PA is due to be completed by September 13, and it is supposed to resolve the thorny issues of Jerusalem, borders, Israeli settlements, former Palestinian refugees and water.