The Lawrence school board Monday began drawing on its $4.7 million treasure chest created through internal budget cuts and student fee increases.

In the first glimpse at how deep the board might go into a list of painful budget options, the board unanimously agreed to set aside $1.1 million for essential expenditures.

The list centered around employee health insurance, technology contracts, school property insurance and a decision to rehire four classroom teachers to eliminate so-called combination classes mingling fifth- and sixth-graders.

Board member Scott Morgan convinced colleagues to allocate $170,000 to hire teachers to avoid combination classes in those two grades.

“There is universal disdain for five-six combinations,” he said. “We’re basically moving to a middle-school curriculum for sixth grade. And it will be an elementary curriculum in fifth grade. Those two grades should not be mixed.”

The next big decision about the district’s 2002-2003 budget hinges on negotiations with teachers on a new contract.

The board conducted an executive session Monday night to map strategy for its May 29 bargaining session with Lawrence Education Assn., which represents the district’s 900 certified educators.

“We have to agree on an amount of salary increase and compare that with priorities,” said Austin Turney, board member.

It would cost approximately $1 million to give all district employees a 1 percent raise and meet the automatic pay increase teachers receive for another year’s service.

Each dollar placed into employee compensation pushes the board further down the $4.7 million list of budget adjustments.

That list includes elimination of dozens of jobs, dropping junior high cheerleading, ending sophomore sports programs and increasing student fees.

The 2002 Legislature authorized a $20 per-student increase in base state aid to public school districts.

However, there is concern among some board members about a possible mid-year recession due to lower-than-expected state tax revenue.

“If the revenues continue to fall behind,” Turney said, “there has to be some measure of cut during the year.”

He said the district ought to set aside several hundred thousand dollars in a contingency fund.

Weseman said the district also could enact a hiring freeze or raid instructional supply funds if state aid is trimmed next school year.

In other business, the board:

agreed in executive session to offer Weseman a contract extension for doing an “outstanding job during a very difficult year,” said Sue Morgan, board president. His contract will be rolled over to stay at three years. Details of the deal will be worked out in a few weeks.

voted to take sealed bids on a double-wide portable classroom at Quail Run School, a library media work station from Sunflower School and playground equipment at Grant School.