What would cause 1989 Ford Contour V6 to surge 300 to 500 RPM while idling?

Generally a surge at low RPMS is caused by a defective vaccum componet or a cracked vaccum line. It still leaks at higher speed but you don't notice it because the engine is GENERATING more volume of vaccum to cover it up. Try this: Take some WD40 and lightly spray it around vaccum lines while the motor is running; as soon as the engine smoothes out you have found the troubled part. The wd40 will TEMPORARILY seal the leak.