Educators in San Lorenzo and San Leandro have approved new contracts that call for salary increases, meaning the two cash-strapped school districts will soon have to make difficult decisions to fund those raises.

The districts are facing possible revenue losses from the state next year, and cuts are now considered inevitable to accommodate the new teacher contracts.

"I am thrilled we reached a settlement," said Christine Lim, superintendent for San Leandro schools. "Now we need to identify what cuts we would make in order to have a balanced budget."

San Leandro Unified will have to cut at least $2.6 million in the next three years to fund the new teacher contract, Lim said.

The contracts are still pending school board approval, but district officials have devised plans to make up any deficit the new deal would create. District officials on Thursday would not provide any details of their planned cuts but said presentations on the matter would go before the public and trustees during Tuesday's education board meetings.

Teachers in San Leandro will see a 3 percent salary increase retroactive to last July, according to the two-year agreement that expires in July 2009.

"We all acknowledge we're just keeping our heads above water but we're not catching up," San Leandro Teachers Association President Jon Sherr said, referring to figures that show San Leandro educators rank among the lowest paid in Alameda County school districts.

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"We're going to stay organized and try to push the district in the right direction."

Meanwhile, San Lorenzo Unified's education board will vote on approving the new teacher contract Tuesday. That contract gives teachers a 3 percent increase retroactive to last July and an additional 1.53 percent raise effective this July. The agreement, if approved by trustees, would expire in June 2010.

However, the San Lorenzo district will have to cut $1.2 million next school year to fund its new deal with teachers. At least $665,000 will also need to be trimmed from the budget during the 2009-10 school year to pay for salary increases, according to Lowell Shira, assistant superintendent of business services.

Educators blame the governor, who is proposing cuts to education to help offset the growing state deficit, for what they consider ongoing public school underfunding.

"The state of California puts districts and unions in an awkward position where teachers need raises and cuts need to be made (to fund salary increases)," said Cathy Lee, San Lorenzo Education Association president. "Does it have to be employees? Not necessarily, but we'll see."

Kristofer Noceda can be reached at 510-293-2479 or knoceda@bayareanewsgroup.com.