Gustav Akerland was wrestling with the same challenge that faces every small town mayors these days, finding the money to pay for fire, police and other city services when tax revenues aren't keeping pace with rising costs.

He had begun poring over budget documents as soon as he became acting mayor of Annapolis in March. And as it became apparent that the town faced a $1.2 million deficit, he grew moody and tense, causing concern among friends with his constant musings that he couldn't possibly submit a budget by the April 30 deadline.

Then, on Saturday nigh, police officers found the 60-year-old Akerland sprawled on the bloodied floor of his Duke of Gloucester Street office, two bullets through his head but still alive. A .22-caliber rifle he had purchased that day lay beside him.

Budget books were stacked neatly on a table. On his desk was a two-page memo, partly typed, partly handwritten by the mayor, expressing himself unequal to the budget task and pleading for the state of Maryland to give municipalities like his own a better break.

Rushed to Anne Arundel General Hospital, Akerland remained in critical condition today after undergoing surgery. There is no suspicion of foul play, according to police, and so this city of 30,000 is left wondering what forces could have driven a man known for his military concern over detail and hard labor to suicide over a municipal budget.

"He was at the helm," said City Treasurer Bill Tyler. "It [the budget] was getting done. That's what is as shocking to me as anything."

Other acquaintances suggested there were factors beyond the budget. But police chief Schmitt told a news conference today that investigations had found no history of mental illness or personal discord. "Knowing Mr. Akerland," Schmidt declared solemnly, "what he wrote is exactly what it was."

Akerland first came to Annapolis in 1955 as an Air Force officer and liked the town well enough to buy a house in the Admiral Heights section. In 1975, he retired to the city after a 35-year military career that included service with a counter-insurgency agency in Thailand and Air Force research units.

Balding and habitually sporting dark rimmed glasses, Akerland found on outlet for his tremendous energy in civic associations, his church and, after a 1977 election victory, the city council.

He quickly became known as Annapolis' only full-time alderman, spending entire working days pursuing city business while his fellow council members held private jobs. "He became wrapped up in everything he did," recalled one colleague.

Earlier this year the then-mayor, Republican John Apostol, announced his intention to quit the job to work for a Fort Lauderdale bank. His arrangement would require him to leave Annapolis three months before his term as mayor expired.

The council chose Akerland, another Republican, to complete the term. The day after he took over in the second week of March, preliminary budget proposals from the city's departments reached the mayor's office and the new man was swamped.

Some city politicans feel Apostol's departure left a "messy desk" in the mayor's office. City departments were proposing major increases in spending instead of cutbacks needed if the city's books were to balance. This year's $15 million budget would have risen to over $20 million under the proposals.

Akerland had pared down the requests and sent them back and last week was trying to find ways to fund a still remaining $1.2 million deficit caused by the city's bus system, pension plan and utilities.

Acquaintances feel Akerland characteristically took the entire job on his own shoulders, shunning help from budget specialists in City Hall. He wanted to straighten things out for a new mayor who would take office after elections in May. Akerland himself had no aspirations to hold the post permanently.

But somewhere along the line, pressure overwhelmed.

After the shooting, police found on his desk, in addition to his budget memo, a note requesting his minister be notified before his wife, a sealed letter to his wife, a letter appointing John Chambers as his successor, and a card donating his body to medical research. Police declined to disclose the full contents of the memo however.