Last winter Republican party leaders let it be known that federal appropriations for public broadcasting were high on their hit list. But after a summer of intense negotiations, a compromise appears to be at hand that could result in a whole new system of financing. The new approach would create a trust fund from some of the windfall generated by new technologies, and could eliminate the roles of both Congress and its funding arm, the Corporation for Public Broadcasting, from the process.

If it survives the final round of negotiations, the new financing system is likely to shed light on the structural strengths of public radio and the weaknesses of public television. And, its advocates suggest, it could give both wings of public broadcasting an editorial and creative boost.

The current round of the debate was launched last March, when two House Republican subcommittee chairmen issued a directive to the Corporation for Public Broadcasting (CPB) to produce a privatization plan that would remove public broadcasting from the congressional budget process forever.

Although the directive was billed as a cost-cutting measure, it was clear that it was also related to the Republicans' distaste for areas of programming, especially on PBS, and to a deep-seated belief that broadcasting was best left to the free market. (Elimin-ating federal expenditures on public broadcasting would hardly make a dent in the deficit. Of the system's $1.5 billion 1995 budget, federal funds accounted for only $286.5 million -- half the cost of a single B-2 bomber.)

Some congressional Republicans suggested that full-fledged advertising on public broadcasting is the solution. Currently, corporate underwriters may briefly describe themselves and their business activities, but the language cannot include a "call to action" urging the audience to buy their products or services. Although some public television stations support the idea of ads, others, along with NPR, cite studies that indicate that advertising would result in a net loss, diminishing foundation and listener support by removing the aura of public service.

Two factors caught the Republicans unawares. One was stronger and broader public support for public broadcasting than they had expected. The other was a policy fault line that divided the public broadcasting institutions themselves. The CPB's response to the directive was to recommend shrinking itself -- continued federal funding, but at a drastically reduced level.

But in May, a group of four public broadcasting institutions -- all of them, unlike the CPB, involved in producing programming -- suggested a radically different approach. The group -- the Public Broadcasting Service, National Public Radio, Public Radio International, and the Association of America's Public Television Stations -- proposed a plan, called "The Road to Self-Sufficiency," to free public broadcasting from the congressional budget process by the year 2000. The strategy entails a combination of cost-cutting measures and the creation of a tax-exempt Public Broad- casting Trust Fund modeled on trusts Congress has established for the American Red Cross and the U.S. Olympic Committee. The trust fund idea goes back to a 1967 Carnegie Commission report, but it has not received serious congressional consideration until now.

The trust fund idea seems to satisfy the demands of the public broadcasting program producers as well as key Republican cost-cutters, including Senator Larry Pressler, chairman of the Senate Com-merce Committee.

 The plan's advocates point out that public broadcasting would stand to gain in editorial and creative independence by divorcing itself from the acrimonious congressional debate. The question, of course, is where the money can be found.

 Trust fund supporters have a number of ideas on how to raise it. Among them are: an approximate 2 percent tax on the sale of commercial broadcast licenses (sales that are currently untaxed); and contributions from commercial broadcasters in return for relieving them of some of their public service obligations, such as children's educational programming.

The idea with the most momentum, however, in-volves the sale of public broadcasting's own broadcast spectrum. As broadcast technology moves from broadband to digital, each current public broadcasting frequency could be subdivided into several digital frequencies, reserving one for public broadcasting and auctioning off the rest. This process is estimated to yield well over $10 billion -- the bulk of which has been earmarked for the deficit. If the Republicans allow $3 billion to $5 billion to go toward the trust fund, it will put U.S. public broadcasting on a new course.

Public radio may be better situated to take advantage of this new environment than public television. NPR has a strong administrative and production center in Washington that generates a coherent schedule of national programming. With the advantages of radio's low overhead and a passionate sustaining audience, NPR's greatest needs are for the stability and independence the trust fund could offer.

For PBS, the future is more problematic. PBS is an association of individual stations rather than a traditional network; if new money does arrive, it is unclear who would determine how it should be spent. Until recently the system has lacked a national schedule, undermining both its profile and its audience. Also, its reliance on British-produced material has blurred its distinction from cable channels that also buy British. If PBS is to advance under a new system, it will need to alter its programming and managerial structure.

 At the same time, the trust fund may be the best way to preserve the existing contributions of public broadcasting. Whatever their flaws, public radio and television have been preeminent providers of quality content in U.S. broadcasting. It is now up to Congress to allow content to become the priority.

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