Hundreds more Baltimore schools employees could face layoffs if the school board follows the recommendations top administrators outlined last night to reduce a multimillion-dollar deficit.

Chief Operating Officer Mark D. Smolarz proposed at a school board meeting that the system lay off 250 full-time staff members and said the district plans to institute in coming weeks a one-day furlough for 360 additional employees - actions that would reduce but not erase a growing deficit this year.

Already, 268 temporary employees have been laid off to help cope with a budget deficit that Chief Executive Officer Carmen V. Russo and Smolarz estimated would reach $31 million if spending went unchecked.

Smolarz said the one-day furlough - which does not need board approval - could come as early as Monday. Smolarz said nonunion employees could face a total of three days of furloughs this school year. He said another three-day furlough could come next fiscal year.

The proposed remedies could have been more drastic. Board member Sam Stringfield said Russo had asked the board earlier this week to consider a possible layoff of up to 600 people.

Smolarz said he and Russo changed their minds about that big a job reduction.

"We don't want to cut so deep this year that we impede the progress we've made in other areas," Smolarz said.

Last night, Smolarz gave the board and the public the first in-depth explanation of what went wrong in the budget process.

Although revenues were stable, Smolarz said, officials in the finance department made some mistakes and underestimated expenses.

For instance, he said, the district didn't include in the budget $10 million for a new computer system being installed to handle payroll and keep track of employees.

"There's no excuse why that wasn't in the original budget," Smolarz said.

Smolarz said his office underestimated last year by about $7 million how much salaries would increase. Instead of basing the projection on actual salaries, an average salary was used.

Smolarz said the school system also will pay about $4 million more in health costs for employees than was projected.

Smolarz indicated that he believed that a poorly staffed budget department was partly to blame for some of the overspending.

Recently, the system has doubled the size of the department and turned over key staff members.

To solve the budget problem, Smolarz recommended six steps, including:

Reducing staff by 250 people. Assuming an average salary and benefits of $54,000, the system would save $3.4 million this year and $13.5 million in the next fiscal year.

Renegotiating contracts for a savings of $3 million this year and $6 million next year.

Furloughing about 360 people who are not members of a union for three days for a savings of $400,000. Smolarz also proposed an additional three-day furlough next year to double those savings.

Making business practices more efficient, including centralizing all printing done in the school system, for a cost savings of $1 million.

School officials have already frozen spending in certain areas.

Total savings, Smolarz said, would be $15.4 million, half of what would be needed to end the year with a balanced budget. Added to a $19 million deficit from the previous year, the system would end this year with a $34.4 million deficit, he said.

But Smolarz believes the system would realize more cost savings in the next school year, and could erase all of that $34.4 million shortfall by July 2004.

Some board members wondered if Smolarz's savings projections were feasible.

Board Chairwoman Patricia L. Welch said the school board wants to see in six weeks more details about how the recommendations would affect programs and students before voting to make significant cuts.

At least two board members were visibly angry that the budget has gotten so far out of control.

"We were charged with keeping the books straight, and we didn't," said board member J. Tyson Tildon. "Anything less than saying that is doing what Trent Lott is doing in trying to say he's not a segregationist."

Other members made their own recommendations for reducing the debt.

Board member Kenneth A. Jones suggested eliminating 300 highly paid academic coaching positions. He said the coaches - who help train teachers in the classroom - could then be returned to their original, lower pay grades.

Board member David J. Stone wondered if the $10 million human resources management computer system was necessary. Smolarz said the system is essential.

"Because we don't have this system in place, that is partly why we are in the situation that we're in," he said.

Stone also asked whether the district's summer school program wasn't "a luxury that we can't afford at this time?"

Russo has mentioned possibly reducing the program to save money, but Smolarz said that school officials still are discussing what changes might need to be made in that area.

Christopher Maher, education director for Advocates for Children and Youth, said, "I hope that when the final cuts are made that they look at what affects student achievement and hold that harmless."