As President Clinton fends off an impeachment inquiry, his lawyers are trading settlement offers with Paula Jones' attorneys in an attempt to forestall further legal and political fallout from the sexual harassment lawsuit.

Jones' lawyers renewed long-dormant negotiations early this month, offering to drop attempts to revive the civil suit in exchange for $1 million without the apology she had insisted on for four years. Clinton attorney Robert Bennett countered with $500,000, according to legal sources in both camps, who spoke on condition of anonymity.A senior Clinton adviser involved daily with the president's damage control efforts said settling the Paula Jones lawsuit has been a priority since Clinton's grand jury testimony Aug. 17 in which he admitted an improper relationship with Monica Lewinsky.