The union-dominated Los Angeles school board stood by $38 million in cuts to classroom programs Thursday but dug deep into reserve and other funds for $90 million to cover rising employee health benefit costs and eliminate previously approved furloughs for teachers.

In a contentious three-hour meeting, board members ignored pleas from Superintendent Roy Romer and warnings that their actions would lead to layoffs in the Los Angeles Unified School District.

In a 5-2 vote on the final 2003-2004 budget, the board approved keeping the $50-per-student cut in classroom spending. That's in addition to $27 million, or $40 per student, cut in the previous fiscal year.

If implemented, the week of furloughs would have meant a pay cut of $35 million for district staffers, or anywhere from a $500 to $1,000 pay cut for teachers depending on their experience.

"Everyone has to make concessions, but the board isn't willing to make the spread equal. They basically put it on the students' backs," said an exasperated Mike Lansing. He and Marlene Canter are the only board members not elected with union backing and the only ones to oppose the budget plan.

"I think the board majority is basically taking the marching orders from UTLA," he added, noting that union leaders sitting in the front row of the boardroom passed "an unbelievable number of notes to board members that not only tell them how to vote, but what to say."

John Perez, president of United Teachers Los Angeles, downplayed the significance of the board's action, arguing that the vote to eliminate furloughs is also a victory for the classroom since teachers are the most important asset in a school.

"I don't necessarily see it as victory for the union. I see it as victory for the people who say the classroom must be the priority," said Perez, who acknowledged that UTLA has been lobbying the board on the issue of furloughs and health benefits since July.

Under the budget adopted, the district will also use $40 million of special funding currently allocated to campuses for everything from library upgrades to programs for gifted and talented students to fill the hole created by rescinding furloughs and absorbing costs of health benefits. On top of per-pupil cuts, reductions to schools will total more than $103 million.

The board further agreed to use $31 million, or half the money from its economic uncertainty reserve fund, to cover costs. But even by taking these actions, the board is still $25 million short of balancing its budget.

With the state still yet to close an $8 billion deficit, Romer anticipates further budget cuts that will bring the district's deficits to $400 million to $600 million in the next fiscal year. To close that deficit, massive layoffs could happen, he warned.

"I disagreed with what the majority of the board did," said Romer, who made an impassioned public plea from the podium to union leaders and the board to keep the furloughs on the table. "I fear it will hurt the district."

Romer tried to persuade the board to postpone the furloughs to midyear and find ways to cut costs in health benefits pending an audit.

In the meantime, he said, he will freeze expenditures for outside conferences and put in other cost-control measures.

In the face of dwindling funding from the state, both the district's health benefits and workers' compensation costs continue to spiral out of control, raising the possibility of financial insolvency unless drastic measures are taken.

"Layoffs, I think, are inevitable," said Romer. "I don't think it's wise to run this close to the cliff."

Board members who voted to rescind the furloughs defended their actions, saying "human capital" is worth the investment.

"I just want to remind all of us, the classroom is the teacher," said Julie Korenstein, a long-standing ally of the teachers union.

Board member Jon Lauritzen argued that furloughs and cutting employee benefits could further alienate teachers who are already coping with increased class sizes adopted by the prior board to balance the budget.

"We are going to lose these employees when the economy turns around. They are going to flee this district in droves, if we don't show them we care. The way we show them we care is to compensate them fairly," he said.