Prince George's County Executive Lawrence J. Hogan is withholding his signature from a regional Metro agreement that, if not executed soon, will cost the transit authority $32 million in federal subway construction funds.

The issue, Hogan said in a recent letter to Metro Board Chairman Cleatus Barnett, is over how Maryland state transit money is to be distributed between Montgomery and Prince George's counties.

Neither the District of Columbia nor Virginia are involved in the dispute, but both could stand to lose construction funds if the Maryland squabble remains unresolved.

The federal money, Metro General Manager Richard S. Page told the Metro board yesterday, must be formally approved by Sept. 30, the end of the federal fiscal year. But federal officials have said they will need four or five weeks to process the paperwork before that can happen. Thus, all the signatures must be on the regional agreement soon.

There are several small construction projects throughout the region that would be affected by the loss of the federal money and one important big project: the construction of a track in south Alexandria that will be used to test new subway cars, the first of which will be delivered next summer. Delays in building the track will mean delays in subsequent Metro openings, Page said.

Joseph Alexander, Metro board member from Fairfax County, said that "I think it's unconscionable for . . . transit agreements to be held hostage for unrelated items."

The issue between Montgomery and Prince George's counties is over how to divide $16.7 million in state operating subsidies. In years past, state money has been divided evenly between the two counties.

This year, with more state funding at stake, Prince George's sought more than half because its Metro operating deficit is larger than Montgomery's. Montgomery countered that, while that was true, it should receive some credit for its county-operated Ride-On bus service.

Montgomery County has signed the regional agreement, but Hogan said in his letter "I must insist that we achieve equity in the funding of the heavy burden of operating costs" and has so far withheld his signature.

Meetings have been held among top administrators from both counties and the Maryland Department of Transportation has also been following the issue. "I think the governor is going to have to get involved to settle this," one informed source said.

Yesterday also marked the last Metro board meeting for Douglas N. Schneider, who is retiring as director of the D.C. Department of Transportation to become a private consultant. Schneider's replacements on both the Metro Board and as transportation director has not been named.