Prince George's County School Superintendent John A. Murphy was passed over for Kentucky's top education post yesterday, leaving county school officials wondering about Murphy's plans.

Widely credited with improving the reputation and performance of the Prince George's system, Murphy announced that he was looking for a new job after his name surfaced as one of three finalists for the Kentucky commissioner of education position.

Murphy, who last spring pulled out of a lucrative 10-year contract offer amid public uproar over its cost and length, said he has been interviewing for "two or three" undisclosed school leadership posts. One of them, education consultants say, is the top job in Boston's public school system.

"It is safe to say that I will be leaving Prince George's regardless of whether I wind up in Kentucky," Murphy said earlier this week. The superintendent, who was bedridden with a foot injury, could not be reached for comment yesterday.

The Kentucky post went to Thomas C. Boysen, head of the San Diego County school system. Boysen, who will be paid $125,000 a year in the new job, is scheduled begin work on Jan. 1.

During an interview earlier this week, Murphy, who is paid $135,000 annually, said he doubted that Kentucky officials could meet his salary demands. "I gave them my numbers, and I don't think they were prepared for that."

However, Kentucky officials said salary was not a factor in their decision. "We have nothing but very high regard for Dr. Murphy," said Jack D. Foster, secretary of the state's Education and Humanities Department and a member of the six-member search committee. "My guess is that Dr. Murphy will have no problem finding another appointment."

Noting that Murphy had seemed distracted in recent weeks, several school officials said they are worried that his departure will cripple the system's ability to cope with a financial situation that has been growing more grim each week. Board members and budget analysts are trying to find ways to trim spending to offset a projected $10 million deficit without imposing layoffs or affecting classroom offerings.

But officials said they might not be able to protect jobs or education programs next year, when the system will face a deficit of at least $28 million. County Executive Parris N. Glendening told board members on Nov. 8 that the county budget shortfall will prevent him from increasing school funding by $48 million as planned to offset inflation and a surge in enrollment. Instead, the school system will get an additional $20 million. Glendening and school officials had agreed to the $48 million increase during budget projections this summer, saying that amount was needed to maintain, not improve, the quality of public education.

A $28 million shortfall is a best-case scenario, school officials said. Next year's deficit could be larger, because state legislators are considering a new funding formula that would increase school spending in less prosperous districts and reduce funds for wealthier ones.

Board members said that it will be difficult to weather tough times without stable leadership.

Murphy "has a lot of good public relations abilities, and we are going to need all the help we can get to put pressure on the county to get the money we need," said school board member Marcy C. Canavan (District 9). "This is a terrible time for us to have to think about conducting a superintendent search."

The last time the Prince George's system faced a fiscal crisis of similar proportions was in the early 1980s, when school spending was slashed after the 1978 passage of TRIM, a ballot initiative that limited property tax revenue and county spending. Board members, faced with a $30 million deficit, fired 500 teachers, eliminated most extracurricular activities and several sports programs, and drastically cut spending on textbooks and school supplies, among other cost-saving measures.