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On Tuesday, Transport Workers Union Local 250-A voted 857-575 against an agreement with the San Francisco Municipal Transportation Agency (SFMTA) that would have helped reduce the agency’s $17 million budget deficit caused by a $179 million cut in state funding the past three years.

Negotiated by SFMTA, the union and Mayor Gavin Newsom, the agreement would have reduced operating costs by $14.75 million, with $1.95 million cut in fiscal-year 2010, which ends June 30, and $12.8 million shaved in FY2011. The pact called for operators to pay their own retirement contributions and work a full 40-hour week before they could collect overtime.

SFMTA’s board plans to vote on a series of budget-balancing actions at a Feb. 26 meeting. Among the proposals: a 10 percent reduction in Muni rail service, primarily through reduced frequencies on most routes and lines; and increasing the cost of a monthly pass for seniors, youth and disabled persons to $30 (a previous action approved a pass increase from $15 to $20 on May 1).

SFMTA had planned to reduce Muni service by 8 percent and shelve the monthly pass hike to $30 if the union had ratified the agreement.