BALTIMORE (AP) _ The administration of Mayor Kurt Schmoke has reversed itself and approved a parade permit for a white supremacist ''skinhead'' group rather than face a threatened court challenge.

Deputy City Solicitor Ambrose Hartman said the city reluctantly approved the permit Monday, despite objections from community leaders, after concluding it could not win should the group sue on the grounds that its right to free speech was being denied.

The group, known as BASH, or Baltimore Area Skin Heads, said it wants to protest the arrival of Soviet Jews in the United States and would march within a month.

The Baltimore Sun quoted an unidentified member of the group as saying the group selected a predominately white, working-class area of Baltimore called Hampden because it is ''one of the last white neighborhoods around.'' The

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