The National Park Service will pay $69,000 in production costs for Las Vegas entertainer Wayne Newton's July Fourth concert on the Mall. In the past three years, when the entertainment was by two rock groups--the Beach Boys and the Grass Roots--such costs were picked up by Washington radio station WRQX-FM ("Q107").

Park Service spokeswoman Sandra Alley said officials tried--and failed--to find a private sponsor to pay Newton's costs.

"Mr. Newton is performing gratis," said Mary Jakoby, Newton's Washington public relations representative. "He is losing about half a million dollars by being here July 3 and 4. For all the grief this poor man has suffered, he's wondering" if it's worth it.

Newton also will be grand marshal of the July Fourth parade here.

Doug Baldwin, spokesman for Interior Secretary James G. Watt, called the production costs "a legitimate public expense for the nation's birthday party." Watt runs the Park Service and chose Newton last March after voicing concern that the rock groups of previous years had attracted "the wrong element"--drinking, drug-taking youths.

At the time, the secretary said Newton, a friend of President Reagan who makes a reported $12 million a year as a Las Vegas crooner, would have "an impact for wholesomeness."

As it turned out, the president and Mrs. Reagan are fans of the Beach Boys. Word went out they were welcome here July 4, but they decided not to come in order not to upstage Newton, with whom they are friendly.

"He's a very well-known and classy entertainer," said Baldwin.

Park Service spokeswoman Alley said the $69,000 would pay for "staging, sound, lights, backstage things like trailers, security, lighting towers, audio mixing, technical and power support systems, on-site supervision . . . any technical support."

Q107 and commercial sponsors that it lined up paid as much as $100,000 for similar production costs for the Mall concerts in each of the past three years under arrangements allowing the station to broadcast the music, according to program director Alan Burns.

"It is one of the few big events that touches a huge number of people in the Washington area," Burns said. "It was a nice thing for us to be able to do."

"We asked Q107 if they'd be interested in cosponsoring Wayne Newton," said Alley, the Park Service spokeswoman. "They said no, because it didn't fit in with their programming."

"Wayne is not the kind of performer that our audience is interested in hearing, so it didn't serve any purpose for us to put any money or time into it," said Burns. A station spokeswoman added, "We play Beach Boys music, not Wayne Newton . . . We're a Top 40 radio station."

Burns said the station suggested to the Park Service many entertainers it would sponsor this year, including James Taylor, Linda Ronstadt, Billy Joel, John Denver and the pop music group America.

Instead, the Park Service chose Newton and Watt approved him. Previously, Watt had sent a memo to Manus J. Fish Jr., Park Service director for the Washington area, ruling out "rock concerts" and instructing Fish to come up with "entertainment that will point to the glories of America in a patriotic and inspirational way that will attract the family."

The idea of having Newton perform came from Jerry Harvey, international director of National Independence Day Festival and Parade Inc., a nonprofit organization of citizens who arrange July Fourth events for Washington in conjunction with the Park Service.

"Years ago, when I used to live in Utah, I went to a benefit that Wayne Newton gave in Salt Lake for the American Red Cross," Harvey said. "And I was impressed . . . Even though he plays Vegas he has a good, clean-cut show."

In April Harvey had said he was "working with a major corporation" to get them to pay the production costs. Yesterday he said that negotiation fell through. Baldwin also had said at the time it was his understanding that Newton would pay the production costs.

Newton representative Jakoby said yesterday Newton will be paying extensive production costs because the production facilities provided by the Park Service are "not enough for his show. He is augmenting it. He is bringing his own lighting crew and sound system . He is coming with a 40-piece band. He has three female black singers. He's coming with his whole show."

The Park Service's Alley said several groups, including a "hotel corporation" she declined to name, came close to sponsoring Newton but didn't "because of the lateness of it. They said, 'Had we known earlier . . . we'd have been glad to do this . . . But we haven't budgeted for this. We wish we had known sooner.' "

The two-hour Newton show will be preceded by a 45-minute concert by the U.S. Army Blues Band. It will be followed at 9:15 p.m. by fireworks on the Washington Monument grounds.