The YMCA came under harsh attack yesterday before a House Ways and Means subcommittee that is investigating allegations that nonprofit organizations use their special tax status to compete unfairly against the private sector.

Representatives of several health clubs trooped to Capitol Hill, where they seemed to get a sympathetic hearing for their complaints about YMCAs around the country that offer competing services at lower cost.

YMCA spokesmen have denied they compete unfairly and have maintained that their fitness programs existed long before private health clubs became commercially popular.

"I don't think the YMCA invented physical fitness," said Rep. William M. Thomas (R-Calif.), who said the House panel intends to tighten rules for claiming tax breaks for business activities unrelated to their charitable purposes.

"There are some Ys, and the Washington National Y {on 17th Street} is a case in point, that no fair-minded person would call charitable," said John McCarthy, executive director of the International Racquet Sports Association.

Solon B. Cousins, the YMCA's national executive director, said YMCAs provide a number of charitable services to their communities. "People act as if that's the only Y in the city," he said. Cousins also said the downtown YMCA offers 500 subsidized memberships for lower-income residents.

According to YMCA officials, the IRS has never ruled that its adult fitness programs should be subject to tax as activity unrelated to the Y's charitable purpose.

But McCarthy called YMCAs "nothing but discount health centers, the discount coming from direct and indirect tax subsidies." Members of his group of 1,100 for-profit health clubs object to paying property and other taxes while their nonprofit competitors steal customers with lower rates, he said.

The subcommittee chairman, J.J. Pickle (D-Tex.), cited abuses of tax-exempt privileges by YMCAs in affluent communities, where services tailored to local needs competed with services provided for a fee by private firms.

"It's hard for me to see how income from yachting classes can be tax exempt," Pickle said, referring to testimony about a program offered by the Beverly Hills, Calif., YMCA.

Cousins urged the panel to consider the broad scope of YMCA activities rather than focusing on particular facilities.

"Our complaint is {that} the YMCA is in exactly the same business we are when they build upscale clubs," said Frank A. Eisenzimmer, owner of the Cascade Athletic Club in Gresham, Ore., which has 4,200 members.

"Our barbells are as heavy as the Y's, our water is just as wet," he said. But because of lower postage rates, tax breaks and a good-guy image that attracts members, contributions and volunteer labor, YMCAs can easily undercut the commercial fitness market, he said.

Eisenzimmer has been fighting the YMCA for several years, becoming an unofficial spokesman for small businesses upset about nonprofit competition.

When the local YMCA tried to build two multimillion-dollar facilities within a few miles of his club, Eisenzimmer persuaded the county tax assessor that the YMCA was not spending enough on charitable purposes, and should therefore not be exempt from property taxes. Both projects were abandoned.

Spokesmen for the YMCA defend revenue surpluses -- the term "profit" is scrupulously avoided by successful tax-exempt groups -- as necessary to support the charitable activities.

Richard Betts, president of the YMCAs of Philadelphia, said his group targeted about $6 million last year for programs for underprivileged youth and adults.

"We're willing to be put to the test by the IRS or anyone else that our activities are related to our purpose," Cousins said.