OLD TOWN — The annual powwow between the School Board and the City Council ended similar to last year’s — with school officials lining up their ducks in preparation for a probable 1991 budget increase.

Currently, the most pressing concern is the topsy-turvy status of the oil account, school officials said. An initial review in October by Superintendent John J. Grady showed that the account could end up $60,000 in the hole. But since then, Grady said, the price of oil has come down somewhat, and the School Department now is eyeing a deficit of about $30,000.

Still, they cautioned, that estimate could change — for better or worse — depending on the situation in the Persian Gulf. In the meantime, school officials will continue to conserve energy and look for school projects to defer until better times. But for now, they remain intent on protecting the classrooms and the staff from the oft-sharp budget knife.

“I don’t want, at this point in time, to touch the classrooms … or the support staff,” Grady said.

Council President Donald Spencer said it was encouraging to know that school officials were doing what they could to battle the problem, saying, “That’s all any of us can do.

“If you find a way to overcome this shortfall, let us in on it because we’re facing the same problem,” Spencer said.

Just as Councilor Virginia Fortier suggested that city officials closely watch decreases in revenue, School Board Chairman Robert Fiske reported that the department already was experiencing a revenue shortfall, with tuition income running less than projected.

Still, in trying to estimate how next year’s budget will appear, Fiske said that the School Board was estimating a gross increase of about 5 percent, a jump that might translate into an increase of 20 percent or higher in the net budget. And as the city looks to make decisions between spending on education and battling the increasing costs of solid waste, Fiske said he hoped that education remained a top priority.

“To do anything else would be irresponsible,” he said.

Although city officials have been proud of the relatively low tax rates presented in recent years, Ralph Canney, chief negotiator for the Old Town Teacher’s Association, said it might be time to raise taxes a little to pay for increased salaries. The School Board and the OTTA have been locked in negotiations since last spring.

“I think you have to take a hard look at the situations surrounding you now and make some courageous and wise decisions,” Canney said.