The Arlington school board approved a budget proposal of just over $60 million last night, setting the stage for what is certain to be a heated confrontation with the County Board, which has the final word on the amount it will provide for schools.

The county board's GOP majority has issued spending guidelines establishing the county's contribution to the schools at $43.5 million -- $3.4 million less than the contribution requested last night.

The school board also decided to ask the county board for almost $2 million in contingency funds in addition to its regular budget request.

The action came on a 3-to-1 vote, with Chairman O. U. Johansen abstaining.

The county board's spending guidelines call for increasing the county's contribution by 7 percent over the current budget. The budget the school board approved calls for a 15-percent increase as recommended by former School Superintendent Larry Cuban.

Republican-appointed school board member Claude M. Hilton, who cast the only dissenting vote last night, argued that the board had not had enough time to study where cuts could be made and warned that the county board is unlikely to contribute its proposed share, forcing the school board to make cuts later.

Member Evelyn Reid Syphax, a Republican appointee who made the motion to adopt Cuban's original budget proposal, countered that the school board had spent considerable time reviewing the negative impact some proposed cuts would have had on the quality of the school system.

Voting with her were Democrats Torill B. Floyd and Ann C. Broder.

The original budget called for a 10 percent pay increase for employes, but the board voted to allocate only 9 percent for raises, placing the other 1 percent in a fund to increase school payments for employe health insurance premiums.

Because of the uncertainties involved in cuts in federal aid, a school enrollment that is not declining as fast as projected and increasing fuel and utility costs, the board decided to ask for an additional $1.9 million in contingency funds.

In related action, the board decided to ask the county for another $1.4 million to fund a deficit for the current fiscal year. All but $487,512 is included in contingency funds for the current budget.