Maryland Gov. Harry Hughes signed into law early this morning a package of bills designed to solve the state's savings and loan crisis sparked by the near collapse of two major privately insured thrift institutions.

Hughes got the seven bills after a whirlwind 14-hour legislative session in which members of both houses of the General Assembly gave almost unanimous support to the package whose aim is to protect depositors and force all privately insured savings and loan companies into the federal insurance program or go out of business.

"This is a milestone in solving the savings and loan problem in Maryland," said a weary but smiling Hughes as he signed the bills at 12:30 a.m.

The legislature also gave the governor the authority to exempt customers of Chevy Chase Savings and Loan, the Washington area's second largest, from his order limiting savings and loan withdrawals to $1,000 a month. The exemption would apply also to any thrift organization which, like Chevy Chase, wins preliminary approval for federal insurance. Hughes said he expects several of the thrifts to obtain federal insurance during the weekend.

The bills passed both the House of Delegates and Senate with little debate. House Speaker Benjamin Cardin (D-Baltimore) congratulated the House when it completed its work at 11:47 p.m Friday, but he said that "the seriousness of this day dampens any pleasure" connected with the swift accomplishments. "We can all sleep better and the people of Maryland can sleep better because of this action to restore confidence in our savings and loans," he said.

Despite the widespread support, a few members voiced concern that the state was trying to bail out undeserving savings and loan associations.

Del. David Bird (D-Prince George's), in opposing a major portion of the package setting up a state agency to insure savings and loan deposits, said that a similar proposal had been rejected by the Ohio legislature when it was wrestling with its savings and loan crisis earlier this year.

"We are being asked to write a blank check to insure all outstanding deposits," Bird said. He noted that there are 350 auditors in the state. "I don't know what they'll find, but if they find a disaster, we have just put the taxpayers on the line" for obligations of S&Ls that have total assets of about $9 billion.

Nonetheless, the bill establishing the agency passed the House on a vote of 109 to 21. Other major parts of the legislation included broad authority for the governor to regulate state S&Ls with a mechanism providing protection for depositors facing hardships. Under that mechanism, the governor is expected next week to allow certain other exemptions to his earlier order on withdrawals including payroll accounts.

Hughes, in a speech yesterday morning before a joint session of the legislature, said that while the state has no legal obligation to rescue the 102 privately insured thrifts, it has "a very, very strong moral responsibility."

Hughes emphasized that yesterday's action was not "a bailout or a break for those few whose ineptitude, mismanagement or greed might have contributed to the current difficulty." Rather, he said, it is "a lifeline" to their 1 million or so depositors.

Hughes was his usual poised and confident self during his 15-minute address to the joint legislative session, an attitude that contrasted sharply with the air of apprehension that has gripped the public and the legislators who began gathering here Thursday.

Del. Wendell H. Phillips (D-Baltimore) voiced the lawmakers' concerns yesterday as he opened the morning session of the House of Delegates with a prayer asking God for guidance in the crisis.

"We, thy children, are in a real mess," he said.

Hughes later in his speech conceded that "the past three weeks have been the most troubling and perplexing during my over six years as governor. We have faced many problems and crises, but none like this."

The cornerstone of the legislative package was the plan, assembled by Hughes in consultation with federal financial advisers and legislative leaders, to help the state-chartered savings and loans (S&Ls) qualify for federal insurance.

Part of that plan would establish a state agency to take over the Maryland Savings-Share Insurance Corp. (MSSIC), the current insurance fund for the privately insured associations, to which the thrifts contribute. But a problem developed over funds that the thrifts have contributed to MSSIC, and it delayed yesterday's anticipated approval of federal insurance for the state's biggest thrift, Chevy Chase Savings and Loan.

A critical requirement for winning protection of the Federal Savings and Loan Insurance Corp. (FSLIC) is that associations have at least 5 percent more in accessible funds than they have in liabilities. In preparing its balance sheet for federal officials, Chevy Chase counted $38 million in MSSIC as accessible capital.

After winning conditional approval from FSLIC on Thursday, Chevy Chase was told by federal officials yesterday that its reserve fund fell short because it could not count its MSSIC funds as assets.

After more than three hours of public and private discussions, both of which included some shouting, lobbyists and representatives of Chevy Chase and other large thrifts hammered out an agreement with General Assembly leaders that would allow their associations to get their money out of MSSIC.

The compromise calls for the Maryland Deposit Insurance Fund Corp. (MDIF), a state agency approved yesterday to take over MSSIC, to return enough money to thrifts to allow them to qualify for federal insurance.

In return, the state will get nonvoting stock in the thrifts equal in value to the funds removed from MSSIC.

Should the state need to sell that stock to cover losses arising from the current scandal, the affected associations would have the first chance to buy back the stock.

Allowing the healthiest thrifts to leave MSSIC and take their funds with them could leave MSSIC seriously depleted, with the state required to raise additional funds to protect depositors, raising the stakes for the General Assembly.

One Maryland banker estimated earlier this week that MSSIC funds might be reduced to $90 million to $100 million -- from $290 million -- once the largest thrifts left, an amount that could be substantially less than the losses the state may be required to cover.

The funds in question are capital contributions made to MSSIC by savings and loans it has insured. Unlike the premiums that a savings and loan also pays into the fund, the capital contributions are refundable when a thrift leaves MSSIC -- but only a year after the savings association notifies the insurance fund that it plans to leave.

The agreement reached yesterday afternoon was critical because another one of the seven bills offered yesterday reduced from $200 million to $100 million the amount of general obligation bonds that the governor is authorized to issue to cover failing thrifts. One reason the bond obligation was cut in half from what was proposed originally was the feeling that major thrifts, such as Chevy Chase, would be joining FSLIC, and therefore would not require the protection of MDIF.

The legislative package passed its final committee hurdle at 6:30 p.m., and by 7 p.m. both houses had begun debate. Prior to that, the Senate Finance Committee tacked on a number of amendments. One of them assures depositors that they will get the full interest rate -- in some instances the highest offered in the nation -- on deposits until last Tuesday, when Hughes issued an order limiting withdrawals to $1,000 for each 30-day period. The interest rate after Tuesday will be established by MDIF.

"There is no reason people who took the gamble should get a state-supported 14 percent interest when the rest of us are getting 5 percent," said Sen. John Coolahan (D-Baltimore County).

The first hint of the dispute over MSSIC funds came in a change in the governor's speech. Instead of announcing that Chevy Chase would qualify for federal insurance as of noon yesterday, as his prepared text had indicated, Hughes said that Chevy Chase was very close to getting FSLIC approval and that two other thrifts likely would be qualified by the first of the week.

Later in the afternoon, tempers rose as savings and loan industry lobbyists argued in meetings that legislation should be written allowing savings associations to count MSSIC funds as part of their assets. Industry representatives, including James D. Laudeman Jr., an attorney for Chevy Chase and a member of MSSIC's board of directors, threatened to march on the governor's office if the Senate Finance Committee was not prepared to amend the bill establishing MDIF.

Chevy Chase lawyers told senators that the thrift had already raised approximately $50 million in new capital to comply with requirements to qualify for federal insurance, but that without the additional $38 million in MSSIC funds, it in "no way" could qualify.

State and Chevy Chase officials had hoped that the Montgomery County-based company would qualify for federal insurance quickly, allowing a large number of depositors whose lives have been complicated by restrictions on withdrawals to return to a normal financial life.

The savings and loan representatives said that federal financial officials had sent conflicting signals. One of them said "the message from the political people at the Federal Home Loan Bank Board was that everything is fine, and the word from the bureaucrats at FSLIC was that they had no intention" of shortcutting regulations to help Maryland thrifts.

By midafternoon, with the problem still unresolved, the industry representatives cornered Senate President Melvin A. Steinberg (D-Baltimore County) and outlined their complaints. Steinberg, weary from days of late night negotiations with Assembly leaders and administration officials, exploded at their request, voiced with the urgency of a demand, that the legislation be amended.

"We can't put up all the money," Steinberg told Ira C. Cooke, who represents an association of the 18 largest thrifts.

"We can qualify three S&Ls for federal insurance by Monday" if the state amended its legislation, Cooke said.

While the lawmakers and lobbyists argued, customers of MSSIC-insured savings and loans were encountering difficulties getting their checks accepted. First Federal Savings and Loan Association of Northern Virginia, for example, has decided not to accept any checks from MSSIC savings and loans.

Some Maryland banks and savings and loans, too, have put a hold on checks from MSSIC thrifts. Citizens Savings and Loan Association President Enos K. Fry said that the thrift has put a hold on all MSSIC checks for 14 days after several MSSIC checks deposited in Citizens last weekend were returned.

Levitz Furniture Co. has given its salespeople the option to either refuse a MSSIC check or take the check as a deposit and hold the merchandise to make sure the check clears, according to store officials. Levitz has stores in Ohio, and officials said they learned a lesson in that state's crisis.

Loehmann's Inc., the discount women's apparel store, said its policy on MSSIC checks is changing from day to day. At this point Loehmann's, which accepts only checks and cash, is waiting for MSSIC checks to clear their bank before they are accepted.

The Philadelphia office of the Internal Revenue Service also said yesterday that penalties and interest may be waived on an individual basis for taxpayers who cannot pay because their funds are in MSSIC banks. IRS officials urged taxpayers in that situation to file tax returns in a timely fashion and to document that funds were unavailable because of the Maryland S&L crisis, for instance by providing copies of the taxpayer's last statement from the savings and loan.

Taxpayers writing the IRS about Maryland-related problems should write MARYLAND SAVINGS & LOAN in bold letters in the upper-left-hand corner of a tax return or related correspondence and send it to PO Box 6073, Philadelphia, Pa. 19114.

Public confidence in the state's privately insured S&Ls was badly eroded last week as reports surfaced of management problems at Old Court Savings and Loan and Merritt Commercial Savings and Loan, both Baltimore institutions. Depositors began withdrawing their money from S&Ls following such reports.

The governor revealed that depositors in the top 20 associations had withdrawn as much as $200 million on Wednesday alone. One week before, on May 8, depositors had taken out $5 million. At the end of 1984, MSSIC institutions had $7.2 billion in deposits.

One of the changes made in committees yesterday concerned the life span of the new state insurance agency. The legislative committees agreed that a definite limit on the agency's existence should be enacted, and created a two-tier system. Institutions with less than $40 million in assets would be permitted to join the new agency for no more than two years; those with less than $15 million in assets would be permitted to belong for four years.

And as part of an arrangement to deal with hardship cases stemming from the governor's executive order limiting withdrawals, the committees added language to the governor's emergency powers bill establishing a mechanism for delineating hardships in consultation with the General Assembly.

That framework will be firmly in place by Wednesday, when the state has been ordered to deal with the exemption issue by a Baltimore court, said Benjamin Bialek, the governor's chief legislative aide. On Tuesday, Hughes will present to the legislature a "guidance document," Bialek said, that will "categorize" certain exemptions to the limit, such as escrow accounts and payroll deposits.

Also Tuesday, when the legislature will return from its recess, the assembly will take up two other related pieces of legislation agreed to by the leadership and governor Thursday night.

One bill would permit savings and loan institutions to convert to full-service commercial banks.

A second bill to be considered on Tuesday would greatly strengthen the criminal laws and penalties pertaining to misconduct by savings and loan officers.