It was pay raise Friday at Minneapolis City Hall.

Despite looming state aid cuts, the City Council voted to go ahead with raises for its top officials, another small group of nonunion employees and three union contracts.

The council rejected on a 7-4 vote a move by budget chair Paul Ostrow to delay the raises for appointed and nonunion employees until the budget picture is clearer.

"Let's hold off until we see how bad the new is," Ostrow urged, referring to Gov. Tim Pawlenty's pending budget proposal, which is widely expected to slash aid to cities.

But council President Barbara Johnson said that holding up the pay raises would be unfair when most of the city's employees have been granted raises for 2009 through union contracts.

The council debate centered on two groups. The first consists of 125 appointed employees. Some are the city's highest-paid officials, but their new pay scales range from $62,446 to $152,278 annually. Their salary schedule will increase by 2.75 percent on May 1, costing the city $284,352 for the balance of the year with salary step increases.

Timothy Giles, the city's employee services director, said a 2006 market study found this group lagged about 10 percent below comparable workers, and some are resigning to return to union ranks.

The second group of employees, those not represented by unions, consists of 148 workers in a range of jobs. They range from fire cadets to senior attorneys. On March 1, those on the top step will get a raise of 2.8 percent and others will get step increases, at an annual cost of $211,386. The council also approved without discussion new labor contracts for trades, foremen and attorney bargaining units.

St. Paul froze pay for its non-union workers last year and has extended that through 2009.

Ostrow said Minneapolis may have to seek to reopen contract talks with unions with which it has already reached agreement to seek cost reductions, which he called preferable to layoffs.

Joining Ostrow in voting to defer the raises for the appointed and nonunion employees were Betsy Hodges, Don Samuels and Cam Gordon. Opposing the motion were Diane Hofstede, Gary Schiff, Robert Lilligren, Elizabeth Glidden, Scott Benson, Lisa Goodman and Johnson. Sandra Colvin Roy did not vote.

The council also:

• Canceled a $90 million water filtration improvement project in the face of rising costs and federal requirements that proved not as strict for filtering microorganisms as once expected.

• Deferred rejecting a federal grant to hire firefighters for lack of matching funds until it knows whether federal officials will grant more time to decide.

• Agreed to explore building a mounted police patrol horse barn at the State Fairgrounds with several other local governments that use horses.

Steve Brandt • 612-673-4438