In a demonstration of the election-year power of one of Congress' favorite interest groups, the House voted overwhelmingly yesterday to give small business a bigger share of the federal research budget.

In three days of debate, the bill's sponsors successfully swept aside strenuous objections from universities, health groups and several members of Congress who attempted to cripple the proposal with an array of amendments.

A "thrilled" Rep. John J. LaFalce (D-N.Y.), the Small Business subcommittee chairman who shepherded the bill to victory, said afterward that the 353-to-57 vote showed that most members were persuaded "by the merits of the bill" and by "a strong feeling that small business has been discriminated against."

He charged that many of the research groups opposing his bill were motivated by greed and a "fear that the bill would succeed."

But an unhappy Rep. Paul N. McCloskey Jr. (R-Calif.), who had led the opposition, said that many of his colleagues, faced with "tough elections," had told him privately that they feared repercussions from the small business community if they voted against the bill.

The bill does not ask for new monies, but would provide a mandatory set-aside from the existing federal research and development (R&D) budget. The percentage would grow over a four-year period to 1.25 percent, or about $375 million annually. The annual R&D budget runs about $40 billion, but the set-aside would apply only to those agencies with budgets over $100 million a year.

Proponents stressed that this was a small amount that could be used to promote innovation and productivity in a struggling economy. But opponents expressed concern that it would stretch an already declining budget and that small business should have to compete along with everyone else for federal grants and contracts in areas ranging from defense and space to biomedical research.

Although the bill sailed through the Senate by a 90-to-0 vote, it has faced intense lobbying from both sides in the House, including growing opposition from a half-dozen committees that sought to exempt research under their jurisdictions.

On the floor, several attempts to remove defense, health, agriculture and basic research funds from the bill failed, but the small business sponsors did agree to exclude R&D funds for intelligence and Agency for International Development programs.

A critical vote Tuesday to replace the mandatory set-aside with a provision calling for "target" spending also was defeated.

The bill now closely resembles the Senate version, and LaFalce said he hoped it would be agreed to without going to conference and would be moved quickly to the president for signing.

The administration, after initially opposing the bill, changed its position last fall. McCloskey yesterday called it the "AWACS memorial bill," saying the about-face had occurred to secure a critical vote on the controversial arms sale.

"If the president has any guts he would veto this bill," he said