When the Reagan administration proposed to increase next year's military band budget 3 percent and slash the National Endowment for the Arts music budget 16 percent, congressional arts caucus chairman Rep. Tom Downey (D-N.Y.) issued a statement on "military music," saying $102 million "is a lot of money to keep those caissons rolling along." Some 11 million Americans attended thousands of free concerts last year in which the nation's 101 military bands performed mainly non-military music. Sam Laudenslager of the Association of Concert Bands of America told Downey he had offended "a large and vocal sector of the arts community"--a million student musicians and 135,000 members of 2,600 civic and community bands who like the military bands and consider their budgets an important arts subsidy. "They're hitting a lot of places that would not be covered by the symphonies on tour . . . from junior high school all-purpose rooms to community centers," Laudenslager said. "They're playing to packed houses almost all the time . . . They play Vincent Persichetti, Robert Washburn, Robert Russell Bennett who scored "Victory at Sea" , Vaughan Williams. You name it." None of NEA's $13 million music budget goes to concert bands; Laudenslager thinks the agency is "elitist . . . not in contact with what's happening out in the hinterlands." NEA officials sturdily deny this: music program specialist Jan Stunkard said military band funding means American band music is "already being taken care of . . . whereas chamber ensembles are almost a dying breed . . . You try to put money into something where it does the most good . . . We're trying to help those organizations . . . that are really struggling . . . If it's popular, the mass public is going to get it anyway."