Board President Jeff Bowser abstained from voting; although according to legal counsel he is eligible to vote, Bowser decided against it because his wife is part of the teachers union's bargaining unit.
Both the total budget and the deficit spending are down from the current year, which ends June 30. This year, the total budget was more than $117 million, and the district spent $1.4 million more than its total revenues.
The district paid for both shortfalls by dipping into reserves, Superintendent Parvin Ahmadi said.
Among the items included in the new budget is a one-time, 1% bonus for teachers and increases in stipends for those who have a master's or doctorate degree. Those stipends will go from $500 to $750 for master's degrees and from $600 to $750 for doctorates. Those with doctorates receive both stipends.
Employees with advanced teaching credentials will also receive a stipend increase from $500 to $750 a year, and an additional $500 for the year they receive the certification.
The district expects to spend more than $1.3 million for stipends, bonuses and other compensation for the upcoming year.
The new budget also increases the highest pay for longtime teachers from $98,045 to $99,000 a year.
"We feel that the agreement offers a fair and reasonable compensation to our employees," Bill Faraghan, assistant superintendent of human resources, told the board.
A fact sheet provided by the district notes that teacher concessions have saved the district $7.2 million since 2009.
The teachers' contract begins July 1. The district remains in contract negotiations with its classified employees' union.
The board unanimously approved contract extensions for Ahmadi, Deputy Superintendent Luz Cazares, and assistant superintendents Faraghan and Odie Douglas. Those extensions do not include pay increases other than what may have already been included in their contracts.
As of her last contract, Ahmadi earned $220,000 with 223 days of service and 24 vacation days a year.
Cazares, who was named deputy superintendent in December, will be paid $191,375 a year. She will also receive a $1,300 master's degree stipend and a $4,000-a-year contribution to her retirement plan. Cazares' $7,200 car allowance was rolled into her salary.
As of his last contract, Faraghan earns $181,644, plus a $1,300 master's stipend and a $1,650 doctorate stipend, along with a $600-per-month car allowance. Douglas, who was hired in May, will receive $162,340, plus master's, doctorate and board certification stipends, which were not specified in his contract.
Cazares, Faraghan and Douglas all work 220 days per year.
Also part of the new budget is $500,000 set aside for medical insurance through CalPERS. The board agreed to contribute $150 a month per employee, with future payments to CalPERs medical insurance in lieu of pay increases or other compensation for teachers.
In outlining the budget to the board, Cazares said much will remain unknown until mid August.
"We're going to have to play catchup," she told the board.
The state Legislature is expected to pass a budget by its June 30 deadline, but it will be subject to line-item vetoes by Gov. Jerry Brown. There are currently two different formulas that could be used to calculate state payment to schools, one of which, known as the Local Control Funding Formula, could put an extra $934,000 in the district's coffers, according to Cazares.
About 20 parents, many with their children in tow, pushed one final time for the board to set aside money for smaller class sizes in kindergarten, second and third grade for the coming year.
Emmeline Chen, who spearheaded a campaign to cut class sizes for first grade, said she'd received enough in commitments from parents to pay the difference between that potential extra money and what smaller classes would cost. She also suggested that the money previously committed by the district for smaller first-grade classes be split to provide slightly smaller classes for students in kindergarten through third grade.
"I feel like there is some flexibility, and I would urge you to look into that before you adopt a budget tonight," Chen told the board.
Both of Chen's suggestions were dismissed by board members who said by the time the district knows the final outcome of the budget, it would be too close to the start of school to hire teachers and allocate the necessary classrooms. It was also noted by Bowser that the district was required to pass a budget before June 30.
The board did commit to look into smaller class sizes in the future, but several members said there are a number of other programs that have been cut that should be considered as well.
"I am not prepared to change our budget," said Board Member Joan Laursen. "I would like to see us come back in August with a plan to get where we want to be."
The district has budgeted $2.9 million for class sizes of 20 students to one teacher for the 2014-15 school year, but could shift the money elsewhere under Brown's plan that would provide schools with a lump sum, rather than designating it to specific programs.
Bowser listed a host of other programs totaling $3.7 million that had been cut and should be considered along with smaller class sizes.
The board also approved a bond refinance plan that could save homeowners an average of $1.21 to $1.34 per $100,000 of assessed value over the next 10 years, with savings of $1.90 to $2.09 per $100,000 of assessed value in 2014.
The district will need to consider adding new elementary schools, according to a demographer's report presented to the board Tuesday night.
"We see the need for at least one new (elementary) facility in the next 10 years," Isaac Johnson, a spokesman for Davis Demographics and Planning, told the board.
Johnson said that, depending upon the number and type of homes -- single-family homes, condominiums or apartments -- built under the city's East Pleasanton Specific Plan, the district could see as many as 1,710 new families in the area.
"It's really seven years and when you consider timing, it's really two or three years out," said Board Member Chris Grant, pointing out the district would have to acquire land, among other things.
"Any development is going to bring students and we have to consider what kind of schools we want," Ahmadi said.
Johnson said the district could need two new elementary schools when the city is built out.
Both Laursen and Board Member Jamie Hintzke said they'd like the district to create a time line for building schools and how new students could be housed in the interim.