ANNAPOLIS, JAN. 13 -- On the first day of Maryland's 1988 legislative session, everybody was friends: Gov. William Donald Schaefer praised legislators, lawmakers deferred any disagreements they have with the governor, and Lt. Gov. Melvin A. Steinberg said, "I love everybody here."

But the question is whether the era of good feelings will last even a week.

Legislators set for Tuesday their first match of wills this season with the feisty governor -- a confrontation over a probable override of Schaefer's veto of a spending bill last summer.

The vetoed measure would have required the governor to get prior permission from legislators before spending money from what is essentially one of the state's savings accounts.

The override vote will be the first manifestation of what may prove to be a recurrent theme in Annapolis this year -- the governor's eagerness to loosen the reins on his spending powers.

The issue boils down to "a testing of the space between the legislative and executive branches," said the bill's sponsor, House Appropriations Committee Chairman Charles J. (Buzz) Ryan (D-Prince George's). Ryan said he was confident that the House would override the governor's veto.

Later in the 90-day session, legislators are expected, for instance, to consider a controversial proposal by the governor to create a $20 million economic development fund he could use to woo business to the state or try to keep existing ones from leaving.

Yesterday was, for the most part, a day of ceremony and camaraderie and a time of settling back into roles established last year, when Maryland acquired a new governor, Senate president and House speaker.

"Last year, we were all new, we were all learning each other," said House Speaker R. Clayton Mitchell Jr., the 52-year-old Democratic Kent County delegate who was reelected today to the chamber's top job. "As we face this new year, we should make sure the legislation we pass leaves this state in a better state than when we came."

The air of conciliation permeated a festive ceremony this afternoon in the lobby of the Senate Office Building to unveil a new portrait of Steinberg, commemorating his four years as Senate president.

Schaefer had nothing but accolades for his lieutenant governor, striving to put behind him an open conflict with Steinberg -- resolved just last week -- over how to restructure the state's college system.

"When you like someone you have great difficulty in putting into words how you feel -- your right arm, your left arm in the one year we've been in office," the governor said. "I've relied on him very heavily."

And Steinberg said of his boss, "I'm really amazed how many things we share in common."

The next three months will test the resilience of today's goodwill.

Schaefer has said his top priority will be persuading the legislature to improve Maryland's colleges by creating a more efficient, accountable method of governing the schools.

Other major issues facing the lawmakers include a proposed light rail line connecting Baltimore to Anne Arundel and Baltimore counties, an ambitious plan to improve prisons, a proposed boarding school for exceptional high school math and science students, further cleanup of the Chesapeake Bay, reviving the Port of Baltimore and a variety of measures to deal with the fatal disease AIDS.

While this session may lack the drama of last year, Mitchell said, "I think it's going to be busier."

But before getting to all that, lawmakers will wrestle with Schaefer's veto of last year's bill, which would limit his freedom to spend money in one of the state's two reserve funds. The two-year-old fund contains nearly $50 million designated by the General Assembly for specific purposes, such as the state's commitment to reimburse savings and loan depositors by December 1989. Currently, the governor must simply inform lawmakers when he draws on the fund, not get their prior permission. The bill would require such permission.

The new requirement "seemed to invade somewhat on the executive budgeting process," said Alan Rifkin, the governor's chief lobbyist.

But lawmakers want more control over the fund, particularly since they are considering putting into it a $50 million initiative to improve the state's colleges, and additional money for savings and loans depositors.

While the probable override reflects what may become a continuing struggle this session over executive versus legislative authority, the debate is hardly new, said Senate President Thomas V. Mike Miller Jr. (D-Prince George's). "This was written about in the Federalist Papers," he said.

Miller was reelected the chamber's president in a low-key ceremony this morning. His fellow senators lauded him for guarding the independence of the assembly and his willingness to stand up to the governor.

Senate Budget and Taxation Committee Chairman Laurence Levitan (D-Montgomery) said he was reminded of Schaefer and Miller last summer, when he was on a safari in Africa. "I was watching two cape buffalo fight for their territory," Levitan said, adding that Miller showed "it is important that the legislature stake out its territory."