The budget includes hiring back 22 police officers who were laid off a year ago. It will also keep libraries and fire stations open. Most city workers will have to take 15 furlough days.
Mayor Jean Quan cast the deciding vote to break a 4-4 tie.
"Everybody worked really hard. They were really close. I don't want to give that much significance to breaking the tie, the difference between the two was less than a couple hundred thousand dollars," she said.
Oakland is facing a $58 million deficit. The city approved a $28 million sale of the Henry J. Kaiser Convention Center. City worker unions also agreed to give back more than $30 million in concessions.