The one-page 2008-09 budget statement is a precursor to the final budget, which the commission must adopt by May 31.

The plan represents about a $109 million, or 5 percent, increase in spending over the current $2.19 billion budget. It was approved on a 4-0 vote with the fifth commissioner, Martin Bednarek, abstaining. Bednarek said later he had received the budget materials late Tuesday and had not had adequate time to review them.

In producing the proposal, district budget executives made several assumptions that could change before a final budget is approved.

The budget includes no money for raises next year for the district's five unions, including the Philadelphia Federation of Teachers, its largest. However, it does provide funding for a 3 percent raise in the current teacher contract. That raise takes effect April 1.

All five unions are in negotiations; their pacts expire in August. If raises are granted, the deficit projection could grow.

The plan also assumes that Gov. Rendell's budget, which has more than $80 million in new basic education funding for the district, will be passed and that the district will continue to spend the same amount on disciplinary schools and the nearly 40 schools run by six outside managers, including Edison Schools Inc.

The commission this month announced that it would re-negotiate terms with companies running its disciplinary schools, so the amounts could change. It is still considering whether to keep Edison and other outside managers originally hired in 2002 to improve the district's most troubled schools. A decision is expected next month.

The plan has no new funding for additional charter schools. If the commission were to approve more charters, costs would grow, officials said.

Commission Chairwoman Sandra Dungee Glenn called the budget "a work in progress."

"However, I think it indicates an extremely good start," she said.

Dungee Glenn noted that the budget includes $15.4 million for smaller class sizes in kindergarten through third grade in schools that have failed to meet federal targets for improvement for several years, and money to assure that art and music is offered in every school in some form. About 120 teaching positions have been added to the budget for the class-size reduction, which will result in a student-teacher ratio in those grades of about 22-1, officials said.

Dungee Glenn had ordered the administration to include more funding for the initiatives this month.

Some school district advocates were skeptical about the budget and questioned whether the deficit was really bigger.

"I'm just to the point that I don't feel you can trust anything that comes out of their mouth anymore," said Greg Wade, president of the Home and School Council, the parents group.

He also pointed out that the class-size reduction only helps the most troubled schools and leaves others continuing to struggle.

"It's going to come to the point where they can't reduce class sizes no matter how much they want to," he said. "They need to come up with a definitive plan that addresses all of this."

Officials said the district anticipates closing the current fiscal year with a $21 million deficit, much smaller than the more than $180 million projected last spring.

They said the district could have achieved a balanced budget this year if it were not for increases in utilities and the cost of cyber-charter schools, which saw a surge in enrollment. Increased debt costs from the turmoil on Wall Street also contributed to the deficit, they said.

The district's interim chief executive officer, Tom Brady, said the district would continue to look for savings and ask the city and state to provide still more help. The state finances about 60 percent of the district's budget with the majority of the rest coming from the city.

Parent advocate Helen Gym said she was concerned that the district included the same amount for the six outside managers when parents have been calling for their contracts to end. More important educational priorities are being neglected, she said.

"How long are we going to subsidize an experiment that has clearly not worked?" she asked.