The proposed $18.1 million budget was approved unanimously at a special meeting of the Covington City Council Wednesday night, but not before the meeting turned into a war of words.

Loud exchanges erupted in the council chambers between Mayor Candace Watkins and the council, particularly Council President Matt Faust, when the mayor announced she had researched the 1957 1 cent sales tax issue, and it clearly excluded using the money for fire and police. It had been thought the older sales tax provided funds that are undedicated and unrestricted, allowing the use of the revenue for any purpose.

The mayor said the 2-cent sales taxes collected for the city of Covington are indeed dedicated and restricted with no provisions for the police and fire proposed step-pay plan that would have been funded by the ?-cent sales tax defeated in the recent election. “To fund the step-pay plan, you need a recurring, expanding source of revenue,” Watkins said. “Even if you were to find the money in the budget, it would be a one-time source.” Watkins also criticized the erroneous information given to the public by City Council members, who she said should know better.

“With the budget increase for all departments in the 2009 budget, I can’t believe we can’t find a few hundred thousand for some kind of step-pay plan,” Faust said.

Watkins called Faust’s stand on the issue “reckless.”

Councilman Lee Alexius, chairman of the finance committee, made five suggestions to resolve the pay plan funding problem: reconstruct the budget entirely, cutting every department budget by 10 percent, which would not produce a recurring source of revenue; not hire the new personnel in the fire department and cut personnel in the police department to fund the raise; use fund balance money, which would leave only a 3 percent cushion in the balance, which would also not be recurring; go back to the people with millage or sales tax at a later date; or fund a study of utility fees, which do not cover the utility costs. Alexius said that in any event, the utility fund study should be pursued “in order to get an unbiased opinion of where we stand with utilities.”

Other matters considered by the council met with mixed results.

Although the mayor had declined a raise, and her present salary of $66,144 was included as part of the adopted budget, the ordinance concerning her compensation met with more controversy.

Alexius proposed two amendments to the mayor’s compensation ordinance, retaining the present salary and eliminating the purchase of a new car. His amendments were defeated by the council, 5-2, with Trey Blackall, Faust, Frances Dunn, Clarence Romage and Mark Sacco voting against.

“Whether you agree with the mayor or not, she deserves a raise because of everything she must deal with on a daily basis. The same for the car,” said Blakall.

Consequently, the ordinance as presented was passed, 5-2, with Alexius and Marty Benoit voting against.

The amendments had been made because Watkins had stated previously and again at the meeting that she would forego her raise and did not want a new car.

Alimony revenue, or property tax millage proposals, “stayed on the table,” and a decision once again was postponed due to conflicting figures provided by the St. Tammany Parish Assessor’s Office regarding the amount of taxable properties in the city limits. The number varies from $92.4 million to $385.5 million. The property assessments in Covington last year were at $88 million.

The total assessment figures and rollback millage numbers are used by the city to help determine whether to roll back millage rates, which keeps the property tax dollar amount the same. The alternative is to roll the amount forward, taxing the new assessments at the current millage, thus raising the amount collected from taxpayers.

Bonding attorney Jerry Osborne, who consults for the city on bond and tax matters, said the figure given to him three days ago was $92.4 million.

The $385.5 million figure was faxed to the council’s office at 3:31 p.m. Wednesday, a half-hour before the council hearing was set to begin, adjusting the rollback millage to 7.54 percent. The document stated the reassessment form was approved by Paulette Jackson on Oct. 28 at 4:48 p.m. for the taxing district of Covington.

Alexius said his preliminary spreadsheet contained figures of $99 million. He said the figures from the assessor’s office “appear to not be correct.”

“Before a decision can be reached, correct figures are needed,” he said.