Adams-Morgan residents and advisory neighborhood commissioners apparently softened their opposition to the Latin Quarter proposal this week after they were assured by city officials that their objections would be taken into account in the planning of any neighborhood economic development.

Community leaders among the approximately 200 people at the Monday night meeting said, however, they would not support the proposal unless major changes are made. The meeting was held by the Adams-Morgan ANC to inform the public of the proposal's intent and to solicit questions and comments.

The D.C. Department of Housing and Community Development plans to allocate $250,000 for a study of ways to turn the Adams-Morgan neighborhood, where a large number of low-and moderate-income Hispanos live, into a Latin Quarter modeled after the French Quarter in New Orleans. The money would come from Community Development Block Grant funds.

James Clay, deputy director of the housing department, told the audience that his department has "agreed to fund the feasibility study." He also said the city is "committed to full input from the community. ANC comments will be taken into consideration and we will modify or change the concept."

Community leaders and residents, who initially said they opposed the proposal outright, agreed at the Monday night meeting that Adams-Morgan needs a comprehensive plan, but said that the Latin Quarter proposal needs major modifications. $&(WORD ILLEGIBLE $&)See LATIN, Page 5, Col. 5> $&(WORD ILLEGIBLE $&)LATIN, From Page 1>

They objected to the plan's emphasis on Latino culture, charging that it did not take into account the racial diversity of the neighborhood. In addition, they said, they do not like the plans to make the area a tourist attraction and are concerned that residents will be displaced.

Mayor Marion Barry, in an interview two days before the meeting, backed the Latin Quarter proposal, saying, "The Latino community has gotten very little money. They've been neglected. They deserve the money even if the end point doesn't satisfy the community."

Referring to opposition to the proposal, Barry asked, "How can they disagree with a study? They would disagree with the results." He said the study will take into account "demographics, econoimcs and community opinion."

Proponents of the plan say that the proposed Latin Quarter would attract many of he 12 million tourists who come to the city each year. The objectives, they say, are to bring tourist dollars into the area and to "increase the economic base" of the neighborhood. They also hope to find ways to finance low- and moderate-income housing ownership for residents who are being displaced by rising rents and condominium conversions.

The ANC voted 7-1 to name a subcommittee "to work with the drafters of the Latin Quarter proposal with the purpose of reconciling differences and stated objectives and administrative procedures." The committee is to report by Sept. 6.

Late last month the housing department postponed for 30 days a decision to fund the proposal to give the ANC time t comment. The 30-day period ends Aug. 21, but ANC officials said they will ask for an extension.

Ann Hughes Hargrove, chairwoman of the ANC, said in a telephone interview that she believes the Latin Quarter proposal will "have to be reworked or it will be voted down" on Sept. 6. "People have recommended that it be renamed and we've got to have it stated on the first page that no conversions of residential buildings or displacement will occur."

"I happen to think of this neighborhood as the Adams-Morgan Quarter," she said at the meeting. "We have to agree on a work program slated toward a housing focus and small business development. We badly need some large-scale planning."

"We need a plan in this area. My concern is that all races and groups work together," said Ed Jackson, an ANC representative. He said that the Adams-Morgan Organization slogan is "Unity in Diversity."

"I'm hearing things that pit one group against others," said Amiel Summers, a local resident. "We've always been unified. We've got a working document., With a lot of changes it could give the kind of direction we need in Adams-Morgan.

Pedro Luhan, president of the Council of Hispanic Agencies and an Adams-Morgan resident for 15 years, said his organization believes the Latin Quarter development should result in "small businesses with arts and crafts from different countries."

Alfredo Echeverria, author of the proposal and the contractor who would carry out the study, said, "There is a lot of displacement in this community - a silent migration of blacks, whites, and Latinos because of economic pressures. The economic development in this neighborhood hasn't been going to these targets. The study will identify economic development strategies."

The proposal calls for the formation of a tourist investment corporation, which would provide capital and loans to tourist businesses, a small business investment company to assist the small entrepreneurs, a community development credit union, and a housing development corporation.