AFTER FIVE years in Washington, there's a bit more silver amid the gold in Jim Melchert's Berkeley-style beard and tousled locks. But he was still smiling broadly and effervescing gently over Perrier and lime as he mused on the powerful job he concludes next week as director of the visual arts program at the National Endowment for the Arts.

This year Melchert administered the largest sum ever given directly to the visual arts by the U.S. government in a single year: $7.4 million. Since Nancy Hanks brought him to Washington in 1977, he has overseen no less than $28 million in grants to artists and arts institutions, the biggest government-supported visual arts bonanza since the WPA.

But this Wisconsin-born minister's son -- an artist himself -- says it was the idea of service, not power, that brought him to Washington. "Working at the Endowment is like doing jury duty -- it's about taking turns at taking responsibility," says Melchert, 51, who, after manning a desk two years longer than he'd intende4d will return to his studio and to being a professor of art at Berkeley at the end of next week.

"Now it's somebody else's turn," he says, allowing that the job has its frustrations along with its satisfactions. "Anyone will age a bit in the position," he chuckles, "but I consider myself extremely lucky to have been involved with this bit of history."

Melchert was so concerned about the sensitive nature of his position that he virtually shelved his own career when he came to Washington, working at his art when he could, but rarely showing, and never here. Oddly enough, given his position as chief representative of America's visual artists, his office walls remained totaly bare throughout his tenure. He didn't want anyone to think him prejudiced in favor of one kind of art or another.

"Jim wasn't your typical bureaucrat," says Visual Arts program coordinator Michael Faubion, "and he brought a California atmosphere to the office which will be missed.

"When appointments turned up at lunchtime, for example, and they hadn't eaten, Jim would take them down to the Safeway in Columbia Plaza, get a sandwich at the deli and some cheese, fruit and yogurt for himself, and then come back and eat in the office."

Melchert's wife Mary Ann was not the typical bureaucrat's wife either. When lunches for visiting panelists were cut out, she began cooking lunches for the panelists at home and hauling them to the office. "It became a regular thing, and made those 9 a.m. to midnight meetings a lot more tolerable. That's something we're all going to really miss," says Faubion.

One afternoon, Melchert gave his staff a demonstration in the art of tai chi, a yoga-like mind and movement exercise he learned when he lived in Japan, and which looks like karate without the body contact. In a sense, that method describes the tactics this soft-spoken administrator used on behalf of his fellow artists when dealing with Congress. In 1980 he made a successful plea to jack up his program's budget from $4.7 million to a whopping $7.2 million.

His successor, not yet named, will be the first to confront a sharply reduced NEA budget for the visual arts in 15 years -- a rollback to $4.7 million, if the Reagan administration prevails.

"It would be a terrible thing if the grants to artists were cut back," says Melchert, who seems more willing to accept cuts in other areas, such as art organizations. "With less grant money, some organizations will survive while others will not, and that is clear. I'd hope that the strongest activities are self-sufficient enough by now so as not to depend on grants alone."

But on the larger question of whether the government should support art at all, Melchert is uncompromising. "When we're talking about art, we're talking about investigation," he says. "And if they can support the exploration of outer space, they should be able to support exploration of inner space -- the human experience -- as well. And that's what poets and painters do."

Melchert feels strongly that the endowment has not received sufficient recognition for major changes that have taken place in the art world over the past decade.

"The way photography has gained acceptance in recent years, and become one of the most active areas in terms of growth, is surely due in large part to all sorts of funding from us," he says.

"And the growth of alternative spaces -- like WPA and the Washington Women's Arts Center -- are something we've paid a lot of attention to. It's there that we now see so much new, investigative work that galleries and museums, for their own reasons, can't accommodate." According to Melchert, 500 such artist-run spaces have blossomed across the country over the past 10 years. "The NEA can surely be credited with this growth," he says.

In addition, he lists a greater range of sculptural activity than ever before, thanks at least in part to the Art-in-Public Places program and the GSA's Art-in-Architecture program; and a new public appreciation of crafts, brought about both through NEA-funded exhibitions and workshops.

"And most important, for me, is the fact that we've helped engage craftspeople in major architectural projects, something Joan Mondale and Jay Solomon, former head of GSA, had a lot to do with. For example, Alexandra Kusuba, who works in tile, is designing the paving that will go outside the old Post Office Building on Pennsylvania Avneue, and ironworker Albert Paley is doing the grillwork and benches for Pennsylvania Avenue in places where people will be sitting and waiting for buses.

"These are things artists and artisans used to be engaged in before modernism purged architecture of all decorative handiwork, such as mouldings and ceilings and floors." He looked down at the plain tile floor beneath his feet and shook his head: "See? An artist could have done something wonderful with that."

Melchert leaves behind a visual arts program which has been dramatically revised for 1982, in part because needs have changed, but more importantly, because of severe budget cuts imposed by the Reagan administration. "We're probably going to have to operate on half as much money as we've had," says melchert, though it now appears that things might not be quite that bad.

To deal with that possibility, however, the two basic categories of visual arts grants -- to organizations and to individuals -- will continue, but on a greatly modified scale. "In essence," says Melchert, "the competition will be much more severe. But the programs that are really strong will still be able to compete for funding."

Remaining as top priority are the fellowships to individuals, which Melchert and his predecessors consider to be the lifeblood of the Endowment's work. "These will continue in the basic subcategories of painting, sculpture, photography, crafts, conceptual-performance, video and works on paper, which includes printmaking, drawing and artists books."

There will be fewer grants, but in greatly increased amounts. "We've decided the best kind of aid we can give to individual artists is time -- the thing artists have the most difficulty in getting for themselves. Most artists I know hold down two jobs, usually waiting tables, teaching or working at some job in order to support the creative studio work. Artists, like poets, dancers, actors and writers in our society, have to subsidize their own creative work. With a fellowship, it's possible for them to drop that job and concentrate on what they're trained to do.

"To allow enough time to undertake major work, we are increasing the major fellowship amount to $25,000 from $12,500. We are also increasing grants to emerging artists from $4,000 to $5,000. These grants are concerned with identifying unrecognized, but demonstrably extraordinary talent. And since grants will only be given every two years, more thought will be given to the timing of each fellowship. Since funds will be so limited, we don't want to give a grant to somebody who doesn't need it.

"There are important times in an artist's life," concludes Melchert, "when they're in a transitional state, and just about to come forth with important work. We want to free them at that point to work, and be sure they're not bogged down because they hold some dreadful job."

Melchert leaves his job to go back to work as soon as his truck is packed on Friday.