Bay State plans to welcome aliens seeking asylum. Legal groups that aid refugees to receive $250,000 from state

There may soon be a new message echoing through the poor, war-torn villages of El Salvador: ``Make it in Massachusetts.'' How could a tired, old Bay State political slogan appeal to Salvadorans? Simple: The thriving liberal state has taken one more small but radical step toward becoming a haven for undocumented aliens, especially those from Central America.

This week Massachusetts will become the first state in the nation to provide public funds for undocumented aliens. On Wednesday, the Massachusetts Legal Assistance Corporation plans to distribute $250,000 to five nonprofit groups that give legal aid to aliens seeking political asylum.

The relatively small wad of money has broad implications:

It challenges the practices of the United States Immigration and Naturalization Service (INS). Supporters claim the ``neutral'' federal agency has become an instrument of foreign policy, discriminating against people fleeing from non-communist governments sympathetic to the US, like Guatemala and El Salvador.

It helps fill the void left by the federal government after it barred the national Legal Services Corporation from aiding undocumented aliens in December 1982.

Beyond these controversial issues lies a critical question: Is Massachusetts at the forefront of a national trend, or is it just a rich, renegade state out of step with the nation?

It depends on whom you ask.

Most observers, however -- whether federal immigration officials or Central American activists -- do agree that state funding for aliens got its start here for obvious reasons: As one supporter put it, ``Massachusetts passed the two hurdles of politics and economics.''

With a booming economy and a $540.7 million surplus for fiscal year 1986, the state's liberal legislators, spearheaded by State Senator Jack H. Backman (D), pushed a $250,000 line item into the budget last spring.

Few states have such a mixture of liberal politics and surplus economics. Many immigration experts think the initiative, which is close to becoming law, is an isolated case.

Despite the small undertow of support for the sanctuary movement, they say, a general tide of anti-immigration sentiment is sweeping the US.

``It's kind of strange,'' remarks Duke Austin, spokesman for the Immigration and Naturalization Service. ``How can you condone people barging ahead of the queue and saying, `I have a right to be here,' '' Mr. Austin asks. ``People who endorse that argument endorse open borders for the US,'' he adds.

Austin also deflects the measure's not-so-hidden allegations about INS practices. According to a survey released last Monday by the Intergovernmental Committee on Migration (ICM), he notes, deported Salvadoran refugees rarely face physical harm or persecution. Says Austin: ``The proof of the system should be: Are people sent back and persecuted? These statistics show that our system is working.''

Central American activists scoff at the findings. They say the ICM report has two built-in biases: It used only voluntary information, which would not be offered by refugees in real danger; and it was sponsored by the State Department, which has an interest in furthering its own foreign policy.

According to Lonnie A. Powers, director of the Massachusetts Legal Assistance Corporation, the INS is turning its back on the American immigrant tradition -- and on the Refugee Act of 1980. He points to wide discrepancies between the success of asylum-seekers from El Salvador and Romania. Instead of being neutral on cases from different countries, he says, ``the INS is giving differential treatment based on a political decision.''

National human-rights leaders hope that argument convinces other states to follow Massachusetts' lead. Indeed, activists who support the measure are spreading the idea to more than 14 other states.

``This initiative is a way to address the artificial gap in aid to aliens,'' says Arthur C. Helton, director of the Political Asylum project of the Lawyers Committee for International Human Rights. ``Given the retiring character of the efforts by the federal government in this area, it's incumbent on states and municipalities to find ways of providing assistance,'' he adds. ``I think you will see other states following suit.''