FUNDING CUTS COULD FORCE CONTRAS HOME

Bush administration proposals to cut Contra aid could force the closing of the Nicaraguan rebels' office in Miami, Contra and US officials said July 18. ``We were notified last Friday that there will be personnel changes and a reorientation of resources,'' Contra spokesman Jorge Rosales said.

The exact amount of the cuts was not immediately known. The Contras also maintain a Washington office.

The proposed funding reduction comes just months after the Miami staff suffered sharp cuts that led to several layoffs. Congress last spring approved $49.8 million in non-military funding for some 10,000 Contra combatants in base camps in Honduras.

David Shapiro, press aide to Sen. Richard Lugar (R) of Indiana, said he had heard about the plan but did not know how much money would be cut.

``As a general notion, if this would provide an inducement to step up political pressure inside Nicaragua, this would be positive,'' Shapiro said. ``If this encourages them to return home and win the elections, the senator would favor that.''

The leftist Sandinista government, which marked its 10th anniversary July 19, announced plans to hold general elections next February.

US Rep. Peter Kostmayer (D) of Pennsylvania also said the reductions could lead the rebels to return home.

Calling the cutbacks ``a rather modest step,'' Kostmayer added, ``We've shifted the focus on this issue, moved away from a military solution, making the Sandinistas cry `uncle.' I think this administration is trying to reach an accommodation with Congress.''

Congress and the Reagan administration often fought pitched battles over funding for the rebels, which has been provided covertly or overtly since 1981.