The Supreme Court yesterday struck down a Massachusetts law allowing churches to control whether nearby restaurants may have liquor licenses.

The court said the law gave too much governmental authority to religious institutions in violation of the Constitution, which requires the separation of church and state.

An 8-to-1 opinion written by Chief Justice Warren E. Burger noted that states and cities can give churches and synagogues the same protection simply by withholding liquor licenses to nearby restaurants or bars.

Yesterday's case originated in 1977 in Cambridge, when the Holy Cross Armenian Catholic Parish vetoed the liquor license application of a popular Harvard Square area restaurant called Grendel's Den, which was 10 feet away. There already were 25 liquor licenses in the immediate area when the church invoked its power.

The law said that premises "located within a radius of 500 feet of a church or school shall not be licensed for the sale of alcoholic beverages" if the church or school objects. Grendel's Den successfully challenged the law's constitutionality in the lower federal courts. These rulings were upheld yesterday by the justices.

"There can be little doubt about the power of a state to regulate the environment in the vicinity of schools, churches, hospitals and the like by exercise of reasonable zoning laws," Burger wrote in Larkin v. Grendel's Den.

But the Massachusetts law, by giving the church the power of a government agency, he said, "enmeshes churches in the exercise of substantial governmental powers contrary to our consistent interpretation" of the First Amendment's clause saying there shall be "no law respecting an establishment of religion."

"In addition, the mere appearance of a joint exercise of legislative authority by church and state provides a significant symbolic benefit to religion in the minds of some by reason of the power conferred," he wrote.

Justice William H. Rehnquist was the lone dissenter, saying the Massachusetts law is "the sort of legislative refinement that we should encourage, not forbid," because it is a less restrictive measure than a total ban on bars in an area.

In other rulings yesterday:

* The court reinforced the flexibility federal judges have to reject electoral schemes which may dilute minority voting strength.

The case began when the city of Port Arthur, Tex., consolidated with nearby white subdivisions, reducing its percentage of black population from about 45 percent to 40 percent.

To compensate for the loss of black political strength, the city restructured its council so blacks probably could be elected to three of six district council seats. But the city also created three at-large seats, including the mayor's position, where citywide majority votes would be required for election.

Blacks said this foreclosed the election of blacks to those seats. They challenged the plan under the Voting Rights Act, saying it did little to ease the negative impact of the consolidation. A U.S. District Court judge agreed, and required the city to elect two of the three at-large council seats by pluralities, rather than majorities.

Writing for the court yesterday in City of Port Arthur, Texas, v. U.S. et al, Justice Byron R. White said "reasonable minds could differ" on the impact of the changes. The district court was closer to the scene, he said, and so long as its decision was consistent with prior Supreme Court holdings, "we should not rush to overturn its judgment."

Justice Lewis F. Powell, Jr., joined by Rehnquist and Justice Sandra D. O'Connor, dissented. They said the court was giving too much flexibility to the lower court, allowing it to "enhance" black voting strength, rather than just "preserve" it. "We are interpreting and applying a statute that vests no such open-ended jurisdiction in any court," Powell wrote.

* The court dealt a severe blow to the National Right to Work Committee's ability to raise campaign funds.

Siding with the Federal Election Commission, the court ruled unanimously that the committee -- founded to oppose contracts that require workers to join unions--could not solicit campaign money through mass mailings to the public.

The controversy revolved around a definition of "member." Federal law permits corporations and unions to establish political funds and solicit money from members or stockholders. The National Right to Work Committee argued that its "members" include anyone who receives one of its millions of questionaires, and responds in a philosophically compatible manner

The Court of Appeals for the District of Columbia agreed, but the Supreme Court reversed the decision yesterday in FEC v. National Right to Work Committee, saying the committee's definition of member was too broad. Membership "requires some relatively enduring and independently significant financial or organizational attachment," Rehnquist wrote for the court. The court also rejected the contention that the restriction on solicitations violates First Amendment rights of association.

In other action yesterday, the court refused to free Indiana from paying millions of dollars to cover the costs of racially desegregating Indianapolis public schools. The justices, without comment, left intact rulings that required the state to bear the brunt of desegregation costs.

State officials had complained that a U.S. District Court judge ordered the state to foot the bill for the Indianapolis desegregation plan, which included busing thousands of students, althrough the city's school board and suburban school districts were found equally responsible for past bias against black students in Orr V. Board of School Commissioners.