It was a great moment in Maryland history, Lt. Gov. Michael S. Steele proclaimed, and Gov. Robert L. Ehrlich and the other dignitaries standing in the shadow of the old brick cathedral applauded the sentiment, celebrating the proposed expansion of the state's first black history museum. Then they went back to their regular business.

Now, all that is left of that optimism of a month ago are a couple of shriveled gold and purple balloons, some scattered bricks and a lump of dirt in front of a sign on the empty lot saying that the addition to the Banneker-Douglass Museum in Annapolis is coming soon. If it comes at all. Construction of the museum's addition was halted by injunction last month after a local lawyer, Thomas McCarthy Jr., sued to demand that Anne Arundel County, which owns the land where the museum sits, and the Maryland Department of Housing and Community Development, which operates the museum, obey the City of Annapolis's rigorous permitting process.

All the parties agreed to halt work on the $5.5 million project until concerns are sorted out.

Much is at stake in the case, scheduled for a hearing tomorrow in Anne Arundel Circuit Court. If McCarthy wins his case, it would put the state government at the mercy of the Historic Preservation Commission, which ensures that all new construction downtown meets the city's strict standards of style. A ruling in McCarthy's favor would also be precedent-setting in that it could affect all construction planned by the state in downtown Annapolis, including a looming $30 million expansion to the Lowe House office building.

For supporters of the museum, which draws about 35,000 visitors a year, it is a question of staying relevant.

With construction of the colossal Reginald F. Lewis Museum of Maryland African American History and Culture slated to begin in Baltimore this summer, the Banneker-Douglass Museum's backers don't want to be overshadowed.

Part of museum officials' plan to double attendance figures was to build a 12,000-square-foot addition to the 9,000-square-foot museum, which hosts art exhibits, historical plays and the occasional band. The addition would give the museum, on Franklin Street in the heart of historic downtown Annapolis, room for new displays and allow them to exhibit items in their collection now being housed off site for lack of space.

No one opposes the construction of an addition -- "Politically, that is a very bad thing to mess with," McCarthy said -- but the proposed design, a three-story brick box with opaque windows, is the sticking point.

Members of the city's Historic Preservation Commission said they had not yet rendered an opinion on the building's design, but local residents and representatives have complained that the addition, which stands almost as tall as the European Gothic cathedral-style building next door, would diminish the church's beauty.

"My first reaction is, it's just too big," Alderman Louise Hammond (D-Ward 1), who represents the area, said about the proposed building. "It's going to overwhelm the church."

Looking out the window of his dignified home, which lies across the street from the museum lot, McCarthy agreed with Hammond. "I think it's wrong, and it's terrible that we should have to file a lawsuit," he said. But "as a general citizen, I don't feel that we should be putting up structures that don't fit in with the surrounding city."

Even some museum backers profess themselves shocked by the design.

"We don't want what has been proposed put up there, because it does not represent the Historic District," said Errol Brown, the president of the Friends of the Banneker-Douglass Museum.

Brown is among those worried about the approaching construction of the Baltimore museum, an 82,000-square-foot complex in the heart of the Inner Harbor that is scheduled to open in 2004. When it does, it will be the largest black history museum on the East Coast. Banneker-Douglass isn't likely to close its doors, but it could be doomed to stagnation as state resources are attracted to the more prestigious museum to the north.

"The one in Baltimore is sucking up all the money," Brown said of the Reginald F. Lewis Museum, named for the successful businessman.

Political turmoil is nothing new in the history of the Banneker-Douglass Museum, built by free blacks in 1874 as the Mount Moriah African Methodist Episcopal Church. For almost a century, through Reconstruction, the days of Jim Crow laws, and finally the civil rights movement, the church served as one of the central houses of worship for the city's black community. Among its congregants were the most successful and wealthy African Americans in the city: landowners, educators, doctors, politicians and lawyers.

In 1972, the church moved to new lodgings, and the property was purchased by the county, which wanted to make room for an expanded courthouse by tearing down the church. After a two-year legal battle, the church was designated a national historic landmark and marked for preservation. In 1984, it would find new life as a museum named after two famous black Marylanders: civil rights leader Frederick Douglass and scientist and surveyor Benjamin Banneker.

Now the museum's fate is wrapped up in controversy and uncertainty.

Technically, the county owns the museum's land, but the state has a 99-year lease on it. If McCarthy can convince the court that the county is responsible for the land, then he thinks he can win the case: The county government is already required to pass the Annapolis permitting process -- a precedent that was set when the county tried to demolish the church 31 years ago.

The state hopes to defeat that argument by contending that the lease's length makes Maryland the de facto owner of the land. Because Maryland is customarily exempt from the city's permitting process, there is no need to look for approval from Annapolis. As a courtesy, representatives from the state showed their plans to the Historic Preservation Commission, but there was nothing the commission could do to change them.

But McCarthy dismisses the state's argument that it owns the property with a wave.

"Jabberwocky," he said. "Nowhere in the law does it say that there's some magical line that's crossed when it's 99 years. . . . I've never seen such a clear-cut issue before."

If McCarthy can't prove the state is responsible for the land, the state is confident of victory.

"We don't believe it's a strong argument" that the state is not exempt from the rules, said Assistant Attorney General Julie Hallum, who represents the state in the case. "And there's a strong case history to back that up."

In a letter to the Annapolis city government, Chief Counsel Robert N. McDonald cited a 1995 case in which the Court of Appeals "affirmed the general rule that the state is not bound by local zoning laws 'unless the General Assembly clearly indicates a contrary intent.' "

Meanwhile, the museum itself carries on -- oblivious to the controversy surrounding it.

One day recently, the museum's deputy director, Wendi Perry, was clearing out an exhibit on African art to make way for one on black watermen. The gray carpets needed to be replaced, and the white walls could use a fresh coat of paint, but Perry was still cheerful as soulful music filled the air. Portraits of Harriet Tubman, Thurgood Marshall, Douglass and Banneker stared down from their perches on the top floor, quietly surveying the scene.

"It's phenomenal for ex-slaves and free blacks to have built this," Perry said as she packed pottery into boxes. As for the court case, she said, "I try not to think about it. That's political."

Lawyer Thomas McCarthy, a neighbor of the museum, went to court to postpone construction of an addition to the Banneker-Douglass Museum in Annapolis until the project is submitted under the city's strict permitting process. The Gothic-style museum, the former Mount Moriah African Methodist Episcopal Church, was built by free blacks in 1874. The building is a national historic landmark.