The Maryland State Arts Council has approved grants to 199 arts organizations in the state, ranging from $417 for the Cumberland Choral Society to nearly $1.2 million for the Baltimore Symphony Orchestra.

Totaling $4.7 million, the grant package for the fiscal year beginning July 1 has controversial elements and reflects the influence not only of artistic merit but also of politics and a need to spread the wealth geographically.

To the arts community, the awards mean crucial support for annual budgets and special projects. The grants also represent a vote of confidence from the panels of grant evaluators -- artists and arts professionals -- assembled by the state's arts agency.

Because of a $2.4 million increase in spending for the fiscal year, Maryland will rank as one of the nation's top five states in per capita state spending for the arts, Jim Backas, executive director of the MSAC, predicted.

In approving its budget, the council voted to:

Restrict state funding of the Baltimore Theatre Project, Baltimore's alternative theater organization, because of its history of financial troubles.

Set aside $110,000 to help the nationally known Alvin Ailey American Dance Theatre create a Baltimore residency.

Make a special award to the endowment fund of the Maryland Symphony Orchestra in Hagerstown, a move ordered by the administration of Gov. William Donald Schaefer.

Greatly increase funding for the Ward Foundation, an Eastern Shore wildfowl-arts museum.

Award almost $1 million to 23 county arts councils and Baltimore, a dollar increase of 25 percent.

Grant the budget funding requests of 86 qualified small to mid-size arts organizations. Last year, there was enough money to give only six organizations such a high level of funding.

The grant decisions were the result of a series of evaluations that began last month. All evaluators were selected to represent audiences that are geographically and culturally diverse and who possess a broad range of artistic tastes and interests.

By the time the grant package was approved June 8, each of the 285 grant applications had been evaluated by as many as a dozen people.

The biggest news for arts advocates was the council's ability to distribute state funds equitably because of a 92 percent increase in funds for small and mid-size organizations. For the first time, all qualified arts organizations in the state were eligible to receive 9.69 percent of their annual operating costs from the state.

Until recently, funding of arts organizations in Maryland was uneven and haphazard, with the major arts institutions lobbying the Maryland legislature individually for their annual allotments.

In past years, the state's five largest organizations -- the Baltimore Symphony Orchestra, Center Stage, Baltimore Museum of Art, Walters Art Gallery and Baltimore Opera Company -- had sometimes received as much as 65 percent of the state's entire budget for arts organizations.

"It was wild out there," Backas said. "With their enormous political influence, the majors could just go around the council to the governor, secretary, legislature, whoever they wished. And we were under orders to give them what they wanted."

When Backas became director of the agency in 1986, he created a funding formula that treated all arts organizations more fairly. The major arts organizations agreed to his guarantee that they would receive 50 percent of the state's art budget each year. They also agreed to the funding definition of a "major" arts organization: A group with an annual operating budget of at least $1 million, high standards comparable to similar organizations nationwide and a measurable effect on the state.

Although the majors were initially apprehensive about welcoming in new majors, Backas assured them that the plan would never allow their funding to be cut in order to make room for others.

These institutions also agreed to end this pact when they were finally able to receive up to 10 percent of their operating budgets from the state -- the ultimate goal of the arts council.

Backas said the term "major" no longer means that such organizaitons will receive more money.