It won't be a billion-dollar Congress after all. By dropping such expensive projects as an expansion of the Capitol's west front and such minor perquisites as free shaving mugs for senators, both house of Congress managed yesterday to bring the cost of Captiol Hill activities in the 1978 fiscal year down to $990 million.

Lawmakers wined last January when the Presidential budget indicated that the cost of running Congress and several related agencies would top $1 billion for the first time.

The figure agreed upon yesterday - when both houses voted final enactment of the congressional money it avoids the politically painful "billion dollar Congress" label.

A number of things were done to get the total below $1 billion among them:

The $55 million proposed extension of the west front of the Capital was dropped until next year Meantime, Capitol Architect George M. White was instructed to prepare alternative plans that would permit either repairs to the existing structure or the controversial extension.

An old custom of providing senators with free shaving mugs, hairbrushes, combs and shipping trunk was ended - but there was no estimate of the saving.

$225.000 for continued operation of the congressional Cemetery in Southeast Washington was eliminated, although the money may be added later to another appropriation bill.

$225,000 for continued operation of the congressional Joint Committee on Defense Production was denied.

The number of copies of the daily Congressional Record that may be sent out free was cut from 100 to 50 for each senator and from 68 to 34 for each go only to libraries or public institutions.

Annual publication of the Congressional Directory, an invaluable guide to officialdom both on Capitol Hill and in the federal bureaucracy, will be cut back to every two years. Next year, a pamphlet will list changes from this year's 1,126-page book.

Revolving funds will be set up in the Government Printing Office, the Copyright Office and the Library of Congress. When one of these agencies sells something to the public, it will keep most of the money to finance future operations instead of putting it in the Treasury and getting it back later through an appropriation. The government won't spend any less in the process, but the amount Congress must appropriate in its money bill is cut by about $30 million.

Agnecies that publish regulations and notices in the daily Federal Register will have to pay for that, like putting an advertisement in a newspaper, thus taking the future cost of the Register out of the congressional money bill.

Rep. George E. Shipley (D-I11.), chairman of the House Legislative Branch Appropriations Subcommittee, estimated that 40 per cent of the congressional money bill pays for nonlegislative activities of the Government Printing Office, the Library of Congress, the General Accounting Office and the Botanic Garden, all of which are considered to be part of the legislative branch of government.