After thousands of striking Verizon workers and city teachers held a rally in Lower Manhattan, the mostly mayor-appointed Panel for Educational Policy voted 8-4 Wednesday to approve the Department of Education's $120 million contract with the wireless communications giant.

As the panel weighed the $40 million contract for phone service and the $80 million contract for Internet service in Murray Bergtraum High School in Lower Manhattan, protesters had two main concerns -- the on-going labor dispute between Verizon workers and management and Verizon’s track-record with city contracts.

About 45,000 Verizon workers had been striking for 10 days, protesting cuts to health benefits and pensions.

However, most of the PEP members voted for the contract, as they are appointed by Mayor Michael Bloomberg and almost always approve what the DOE wants.

Five other panel members are appointed by borough presidents, and four of those members present at the meeting voted against the contract.

The striking workers accused the DOE of union-busting for voting for the contract while the strike is on-going.

"If you vote on this tonight, if you pass this tonight, you stand exposed in front of all of us," said a protester to the panel.

"Tonight, ladies and gentleman, you do not have the ability to grant [Verizon workers] health care benefits but you do have the ability to push this vote off," said another protester to the panel.

"Shame on Mayor Bloomberg and [Schools] Chancellor [Dennis] Walcott for once again sticking their heads in the sand, in hopes that we all will just go away," said parent advocate Zakiyah Ansari during the rally. "And we say to them, and we say to Verizon, can you hear us now? We aren't going anywhere."

"We should not allow our public tax dollars to go to support corporate greed at the expense of living wage jobs and benefits and the ability for all of you to continue to have union representation," said Manhattan Councilwoman Melissa Mark-Viverito during the rally.

Wednesday's vote was retroactive, as the contract is for service that the schools started using on January 1. DOE officials said most city agencies use the same Verizon contract, including many of the elected officials who rallied in opposition.

The officials said they have been using Verizon for over a decade, and Verizon set up all the infrastructure, like phone lines and Internet cables. They say if they hired a different company, it would still have to pay Verizon to use the infrastructure. So by using Verizon, they will save.

The DOE's background check turned up 18 issues considered “significant and adverse” with Verizon in New York, but DOE officials say despite those issues, the department considers Verizon a “responsible vendor” for the required services.

Another issue the DOE does not mention is a case that came to light in April. The special investigator for the schools found a consultant stole $3.6 million from the DOE, using Verizon to help filter the money.

Investigators determined Verizon had facilitated the fraud and said the company should pay back the money and let auditors look at its books. Neither has happened yet.

The president of Verizon New York told NY1 that case is still under negotiation.