When it was charging I unplugged the wires from the voltage regulator (70-up style) and it discharged but did not notice a drop in idle. I unplugged the ground from my fuel pump relay when it was discharging and it still discharged. I removed the paint from the firewall and head under the ground strap terminals and made sure the bolts were tight. When it was discharging the positive field wire had 12V. Both the positive and negative field wires had less than .3 ohms of resistance from the alternator terminals to the voltage regulator. I noticed the discharging usually starts at higher rpms when it is warm. I tightened the belts, but the problems remains. Any idea what else could cause a simultaneous increase in idle speed and discharge?

Edit: I ran the engine when it was starting to get dark. I can see arcing in the alternator when its charging. If I take it up to 2-3,000 rpm it will start discharging for a few minutes. There is no arcing in the alternator when it discharges.