National Endowment for the Arts Chairman John Frohnmayer said yesterday that he will not reject any grants on the grounds that they violate a decency provision in the endowment's authorizing legislation.

"I am not going to be the decency czar," Frohnmayer declared at a special meeting of the NEA's advisory council.

Frohnmayer's pledge immediately drew a critical reaction from Hill staffers, who observed that the legislation states that "the chairman shall ensure" that grants are made taking into consideration "general standards of decency." One aide to a moderate representative complained the endowment had not consulted with legislators before interpreting the decency provision.

In response to a testy discussion of Frohnmayer's recent decision to reject a grant for New York artist Mel Chin, Frohnmayer told the council that he would make a greater effort to notify council members when he intends to override their recommendations. Most council members said they learned from news reports that Frohnmayer was rejecting the Chin grant. But Frohnmayer did not offer to reconsider the application, which he said he rejected on aesthetic rather than political grounds.

The council met to interpret the far-reaching legislation passed hastily in the final hours of the 1990 congressional session. Some of the changes, Frohnmayer commented, had never been explored in hearings. "It was just all of a sudden, bang, a done deal," he said. "... It's almost impossible at this point to quantify what this really means."

The decency language is the most controversial part of the legislation, and several grant-review panels already have asked for clarification from the endowment. Yesterday, the Pacifica Foundation -- which refused a 1990 grant in protest of obscenity restrictions -- said it will not apply for grants in 1991, to protest the decency provision.

NEA General Counsel Julie Davis told the council yesterday that she had analyzed that language and found it to be "a very slippery, very broad and very vague standard." The term "decency" has meaning only "when taken into context with artistic excellence" and constitutional protections, she added.

The NEA gave the council the option of voting to include decency language in a "mission statement" attached to the endowment's guidelines. But the 12 council members present unanimously concluded that grant-review panels would apply "general standards of decency" as a matter of course because of their diverse makeup.

Council member Wendy Luers questioned whether the Hill would react negatively if the NEA did not alert grant applicants and panel members to the decency language. The endowment's congressional liaison, Rose DiNapoli, said only "a very small number" of NEA critics would want the decency provision translated into a written requirement.

In fact, a key congressional aide said Frohnmayer appears to be delegating his responsibilities to apply the decency standard. Frohnmayer insisted the peer panels are the best way to ensure compliance. "There will not be a case when I will impose my own judgment," he said.

Arts activists were skeptical. If Frohnmayer intends to defer to review panels on the decency question, he should defer on matters of artistic excellence as well, said Susan Wyatt of Artists Space in New York.

An arts lobbyist observed after the council discussion that Frohnmayer has rejected controversial grant applications because he said they did not build public understanding of the arts. "We trust he won't use other phrases, like 'public appreciation of the arts,' to set himself up as a decency czar," the lobbyist said.

The most recent grant veto came last month when Frohnmayer turned down Chin's application to create "Revival Field," a conceptual work using plants "to remediate an area contaminated with heavy metals." The grant was the first that Frohnmayer rejected despite a positive recommendation from the advisory council.

During yesterday's meeting, council member Luers said the decision "outraged" artists in Chin's field and asked whether Frohnmayer had succumbed to "political pressure."

Frohnmayer said he faced "absolutely no political pressure" and acted strictly because he thought the proposal lacked artistic merit. "One of the obligations of an applicant is to tell us how this project is going to relate to the public," he said. The council's discussion of the application before approving it had been "cursory and mixed," he said.

Frohnmayer urged the council to try to calm those who object when a grant is vetoed. "I think this council has an obligation to make sure that the field doesn't go crazy on this kind of situation," he said. "... Just because an artist is denied does not mean that an artist is somehow rejected in terms of aesthetic abilities."

"We can't deal with the field if we don't have information," Luers retorted. After most council members learned of the decision through news reports, she continued, "you did send us a memorandum which had about nine lines in it."

Frohnmayer said he would try to discuss grant rejections with council members in advance, but added, "It might still put us in a situation where some of you are going to be unhappy. That's my job, folks." The NEA chairman is still considering the fate of grant applications from controversial performance artists Holly Hughes and Karen Finley. Both were approved by the council.

Frohnmayer urged council members to speak frankly about grant applications even though their review sessions recently became public. "If you can't do that, your advice to me isn't worth a nickel," he said.

In other action, the council expressed dismay over a congressionally mandated increase in NEA funds that must be allocated to state arts agencies. In fiscal 1991, staff said, the measure will shift $12 million from NEA-administered programs. The council also expressed its agreement with a letter from painter Helen Frankenthaler urging the inclusion of more artists on the advisory board.