Howard County schools Superintendent Sydney L. Cousin unveiled Thursday night a proposed $664.781 million operating budget for fiscal year 2011 - an increase of $8 million over the previous year's - despite a troubled economic climate.

The amount is expected to increase after negotiations establish new contracts for four of the unions representing teachers, administrators and other staff in the school system.

Although there is no exact date that the school system and unions have to finalize their agreements, the process is expected to be completed by the end of February, according to school system spokeswoman Patti Caplan.

Cousin, who presented his proposed budget to the school board Thursday, attributes the 1.2 percent budget increase to $9.6 million in additional health insurance costs, anticipated changes in the cost of bus contracts and route changes, and $3.6 million in technology user charges.

"This is a pragmatic budget that addresses the needs for maintaining the accomplishments that we have attained," Cousin said.

The school system has attempted to combat the increases by cutting nine central office service positions and trimming overtime of custodians and maintenance workers by $121,800. The school system has also deferred the purchase of all new vehicles for the second consecutive year and put off cosmetic maintenance to a number of schools, according to Cousin.

"Our needs have changed," Cousin said. "We are moving away from building new schools to modernizing old schools."

The school system projects that it will save money with cost-cutting efforts and new contracts. For example, the school system expects to save $1.5 million in energy and utility costs by entering into a consortium with area school systems and local government. By deferring energy upgrades and participating in energy management efforts, the school system will save $300,000. A new trash and recycling contract will save $70,000. And an additional $50,000 will be saved through a less-expensive pest control contract.

"We want to be good stewards," Cousin said. "We want to deliver the high-quality education that our community has come to expect and demand of the school system."

In December, Cousin announced that he would furlough 77 non-school-based administrative, management and technical staff for three days. The effort saved the school system $120,000.

"You can only furlough a certain number of times," Cousin said Wednesday. Before the announcement of the furloughs, the school system had initiated a number of cost-cutting measures during the current fiscal year including: cutting funds for professional meetings and conferences by 50 percent, which has resulted in a savings of $75,000; reducing contributions to the school system's Workers Compensation Fund by $800,000; deferring the purchase of 15 replacement cars, trucks and vans, which has resulted in $417,700 in savings; cutting $1 million from maintenance of buildings and grounds; and eliminating almost a dozen central office positions, which has saved $916,000.

In addition, account managers have been directed to closely review all spending, with attention being paid to areas such as travel. Teaching vacancies have been filled with long-term substitutes.

"There has been little to any recognition that we have made reductions," Cousin said, referring to local and state politicians who are calling for more cuts by school systems.

The next step in the budget process is for the school board to hold public hearings and work sessions and to submit a request in March to the county executive, who can make reductions before submitting a proposal to the County Council.

The council, which can make further cuts or restore funding, has until late May to approve a budget that takes effect June 1.