The correct procedure, given a 50 year old pool with rotten concrete and a low "get us by till next year" budget?
Sounds like your approach is good as any. I'd just recommend you remember you are PATCHING, and not really 'fixing' the pool. Where there's a little rotten concrete, there's often a lot. And if you get carried away removing bad stuff, you're likely to go over their budge in a heartbeat.
A "correct" approach would involve removing all the old paint and rotten concrete, repairing what needs -- which you wouldn't know till you exposed everything -- AND collecting enough money all along, so when they decide, "Gee, we can afford this", you can walk away without having taken a bath yourself.
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