NEW LONDON — Mediation efforts between the Twin Pines Housing Trust and the New London-Springfield Water System Precinct have stalled, further delaying a workforce housing development stalled by the discovery of dry cleaning contaminant in a local aquifer and the denial of permission to connect to New London’s municipal water supply.

The water precinct claims that it cannot accommodate the capacity needs of Twin Pines’ project, a mix of one- and two-bedroom apartments on an 8-acre site across County Road from New London Hospital. In 2023, it denied the organization’s request for water service.

Twin Pines then located a well that promised enough capacity to serve the housing project. But that option became unavailable after the discovery in July of Tetrachlorethylene, or PCE, contamination in the water supply of a nearby property.

Twin Pines alleged in its initial complaint to the Housing Appeals Board that the precinct exhibited “an arbitrary, unlawful, and unreasonable predisposition to approve certain projects and disapprove others.”

A hearing before the appeals board was scheduled for November 21. Just prior to the hearing, both parties informed the board that they had agreed to enter mediation, with the understanding that if an agreement could not be reached by December 31, the matter would return to the board.

Both parties have agreed to keep the mediation window open until January 15, Twin Pines Executive Director Andrew Winter said in an email Monday.

“Twin Pines Housing is disappointed with the outcome of the mediation session but remains focused on identifying potential solutions,” Winter said.