Dozens of schools will get new access to mental health services for their students under a $30 million initiative that Chancellor Dennis Walcott unveiled today.

Walcott introduced the new initiative during a City Council hearing about the Department of Education’s proposed budget for the fiscal year that begins on July 1.

Chancellor Dennis Walcott testifies at City Council's budget hearing today.

The Department of Education’s proposed budget is $19.7 billion, 1.5 percent higher than this year. The increase, which comes after three years of budget cuts, is allowing the city to add teachers rather than cut them this year.

But Walcott cautioned that the city would still have to lay off 225 school workers who are represented by the District Council 37 union. Principals cut the workers loose last year but the department has been covering their costs, according to Walcott, who called the arrangement “unsustainable.”

“I don’t want to see any layoffs, I know DC 37 doesn’t want to either, and most of all, neither do the men and women affected by the prospective loss of employment,” said Walcott. “If we can work with the union to identify savings and concessions to offset these costs, layoffs are avoidable, and I’m hopeful this can be accomplished.”

The department laid off around 700 school aides in October after negotiations to save their jobs failed. A DC-37 official declined to comment immediately on the threatened layoffs, saying that the union was surprised by Walcott’s comments before the council.

Last year’s layoffs attracted council members’ ire but today they were more interested in hearing about the multi-million dollar mental health initiative. Walcott’s announcement came  a month after the council held a hearing about the increasing number of students sent to emergency rooms because of mental health issues.

The plan calls for the development of 20 new school-based centers over three years at middle and high schools. There are currently 126 school-based mental health centers that serve over 150,000 students.

“These new centers will provide on-site primary care and mental health services, helping to keep our kids healthy, secure, and in school,” said Walcott.

Robert Jackson, who chairs the council’s education committee, was one of several council members to praise the mental health plan. Jackson also lauded Walcott for tightening regulations over large contracts. The chancellor said he would scrutinize new contracts as well as those that are up for renewal worth $100,000 or more.

The department’s increased budget includes a $52.2 million increase in funding for special education services and a 91.5 million increase for charter schools. The 12.4 percent growth in the Department’s charter school budget will support the opening of 24 charter schools and the expansion of student enrollment in existing charters this September.

Not all Council members were receptive to the increased funding for charter schools. “Spending for charter schools should not come at the expense of our district public school students that face services reductions year after year,” warned Jackson, in his opening statement at the hearing.

Walcott offered a couple of ways that the department is working to cut costs. He said new contracts with bus companies — which prompted warnings of a bus strike last fall — would reduce transportation costs. And he called attention to a proposal announced earlier this month that could remove idle teachers from the city’s payroll.

“If you’re a teacher who can’t find a permanent job in our schools after a year, we will offer you a generous incentive to resign and pursue another career,” said Walcott, stating that there are teachers who haven’t made an effort to find a new position at a school. “We simply can’t afford to foot a $100 million bill on teacher who aren’t even interested in teaching.”

Union and city officials met Tuesday for the first time to discuss the retirement and resignation incentives, according to a union spokesman.

Proposed cuts to early childhood and after school programs are shaping up to be a major point of contention about the city’s budget. Those cuts would come from the Administration for Children’s Services, not the Department of Education. But Councilwoman Margaret Chin urged Walcott to meet with ACS to minimize the cuts.