The Alexandria School Board approved a $55.5 million budget proposal last night that would give all school employes at least a 4 percent pay raise, but not as much as was sought for teachers by School Superintendent Robert W. Peebles.

The amount requested by the board for the next school year is 6 percent higher than the current budget of $52.4 million but slightly lower than the original budget Peebles proposed last month.

The budget was adopted by a 7-to-2 vote, with members Mary Jane Nugent and Rhonda D. Hill in opposition.

Peebles and a representative of the Education Association of Alexandria, which claims membership of most of the city's teachers, asked that the board appprove Peebles' request for a 5 percent raise.

"A reduction of one percent will take Alexandria out of the competitive arena," Peebles told the board. "The City Council should remember that the board of education is appointed by them to do the best job with the money provided. We're scrapping to stay competitive.

"Lowering a raise that had been agreed upon in discussions sends a message out to prospective teachers and to teachers working here," he added, "and this message is not positive."

Although the board decides how to allocate funds provided for education, the City Council, which has issued guidelines for the school system that call for limiting the increase in school spending to no more than 6.5 percent, must approve the budget.

Several council members said before last night's vote that the council, which is trying to hold raises for municipal workers to 3 percent, would be unlikely to appropriate money for teacher raises of more than 4 percent.

The reduction in the proposed teacher raises from 5 to 4 percent will mean a savings of $434,000 for the school system, Assistant Superintendent William F. Leonard said.

Board member Timothy S. Elliot pointed out that 4 percent was only the minimum raise for school employes and that with cost-of-living increases already provided for senior employes the average raise would be close to 6.5 percent.

Pamela S. Walkup, head of the teachers union, said that a 5 percent increase would keep pay scales comparable to other localities and that a 4 percent increase would not.

"This is not fair to us at all," she said. "A 5 percent pay increase for teachers is equitable and needed."

In addition to the salary adjustment, the board voted to add $200,000 to the budget in contingency funds for transportation and capital expenses. It also agreed to add $10,000 to summer school funding and to spend $5,000 more on interns. In addition, the board established a $40,000 general scholarship fund.