PHOENIX - A Clinton administration executive has asked Congress to repeal a rider that gives a telescope project in southern Arizona an exemption from the Endangered Species Act.

In a July 16 letter, Jacob J. Lew, acting director of the Office of Management and Budget, urged three members of the Senate Appropriations Committee to seek a repeal of an authorizing provision Rep. Jim Kolbe, R-Ariz., added to a $160 billion spending bi ll Congress passed in April.

Kolbe spokesman Ron Foreman dismissed the letter Friday, saying there is a single paragraph about Mount Graham in Lew's 17-page letter.

Construction of the $60 million Large Binocular Telescope, a joint project of the University of Arizona and Italy's government-backed Arcetri Observatory, resumed last week with the clearing of trees.

Work halted in July 1994 by environmentalists' court challenge. Construction began again after courts rejected several petitions subsequent to the congressional action.

Congress authorized three Mount Graham telescopes in 1988. Two are in operation, but environmentalists long succeeded in delaying completion of the last and largest.

Opponents contend the project will extinct the endangered Mount Graham red squirrel, a subspecies found only on the Coronado National Forest mountain near Safford. They also argue the mountain is sacred to some Indians.

In his letter, Lew noted those points and that portions of the squirrel habitat were damaged by wildfire in May.

Following a spring count, the Arizona Game and Fish Department said the squirrel population appeared to be steady and stable, and unharmed by the fire.