AFTER TWO ill-advised, unilateral attempts to cut school money after approving the amounts in the first place, Mayor Barry has now thought better of it--and has agreed to a sensible compromise with the school board. Not only does this latest agreement set forth more clearly the lines of financial authority between the mayor and the school board, but it also averts what could have been a stinging court ruling against the mayor.

The issue arose when Mr. Barry sought to ease a city deficit by instituting a new procurement policy for city agencies, under which money for any order not received by the end of a fiscal year would revert to the city. The school system, which under law enjoys a budget independence not accorded other agencies, threatened suit. The mayor then tried to cut $7.2 million from the current school budget, claiming the right to apportion a city deficit among all city agencies.

That sent the school board to court, where a judge granted a temporary order barring Mr. Barry from cutting the money--and concluded that the mayor had "exceeded his authority." Regardless of any good, responsible fiscal intentions that Mr. Barry may have had, the unilateral efforts did appear to fly in the face of the semi-autonomous status that Congress and the D.C. Charter specifically accord to the school board and to its budget authority.

While the mayor and council do have authority to set a dollar ceiling on the school budget when the schools' spending requests are first submitted as part of the total D.C. budget process, the mayor's order to the schools came after the schools' budget was approved; and besides failing to include the school board in his decision to cut the budget, Mr. Barry also failed to seek D.C. Council approval. This particularly "disturbed" the judge.

Whether the school board and its budget should be considered so separately is a fair question for a mayor to raise when he is staring at--and ultimately responsible for--a deficit. But a responsible mayor has to work with the council and school board to address it.

Under the settlement terms, the school board agrees to align its purchasing practices with those of other agencies and to entertain "in good faith" suggestions or proposals from the mayor to reduce school spending to offset revenue shortages. Most important, the agreement states the mayor may not reduce the school budget without going through the council and Congress first, as he must do with the original budget requests anyway. It makes good sense.