Betty Ann Kane, a D.C. school board member who is seeking a City Council seat, charged yesterday that continued slashes in school budgets stem from "failure of the City Council to give more than lip service to education."

If elected as a Democratic at-large member of the council, Kane said at a sidewalk news conference outside the school board office, she would continue to push for adequate financing of education.

"The City Council and the mayor - not the school board and only peripherally the Congress - decide how much funding goes for city schools," Kane said.

This results from a complex procedure under which the school administration and the school board ask for the funds they think are needed, but the final figures are proposed by the mayor, adopted by the council and appropriated by Congress.

Kane who chairs the school board's finance committee, said Mayor Walter E. Washington's administration has proposed to grant the school system only $3.8 million of the 10.8 million in budget increases needed in fiscal 1980 to pay for mandatory cost increases. This would result in a net loss of 224 teaching jobs. The total school budget would be $257 million.

Since 1970, Kane said, the school system's share of the city budget has dropped from 25 percent to under 17 percent, a far faster drop than the decline in school enrollment. "I really question what this says bout the city's real commitments and priorities." she said.

At another downtown sidewalk news conference, rival council aspirants Goldie C. Jonson and Marie S. Nahikian accused yet another candidate, H. R. Crawford of making racist remarks and - according to Johnson - calling all his rivals "idiots and stupid." Johnson demanded an apology.

Nahikian said Crawford's involvement with government subsidized housing raises the prospect that he would not be able to vote on housing matters as a council member without violating conflict-of-interest laws. Kane and JePhunned Lawrence, another candidate, have made similar accusations.

Asked about the charges, Crawford said, "I'm not going to respond anymore to that rubbish. I just want to make the public aware and concerned about the character of those (others who are) running." Crawford has said he would divest himself of any holdings that created a conflict.