To maintain a tax rate cut that the City Council enacted over his objections this year, Richmond Mayor L. Douglas Wilder promised spending cuts that he said won't affect services.

Wilder yesterday confirmed the city has been operating under his budget since the start of the fiscal year three days ago, instead of using the City Council's competing version.

He said he needs to cut at least $6 million in spending to bring his budget into balance and keep Richmond's real estate tax rate at $1.20 per $100 of assessed value.

"There won't be any cuts in trash collection or any of that nonsense," Wilder said. "We're not going to cut services."

But there will be no room for a 1.5 percent cost-of-living-adjustment increase in retirees' pensions that the council had approved, he said. His budget did not include the increase, which would cost $2.7 million this year.

That could make the July pension checks the issue that takes the dueling budgets to court.

"What's going to happen when they write those checks?" asked Council member Kathy Graziano. "Are they not going to be paid?"

Philip Langham, executive director of the Richmond Retirement System, has said the city attorney and the attorney for the retirement system's board of trustees have told him he has to follow the council budget provision authorizing the 1.5 percent increase.

Wilder said the council budget is invalid because the council did not pass two measures involving revenue before the May 31 deadline for approving a balanced budget.

The council, backed by City Attorney Norman Sales, said the two measures involved spending in the just-completed fiscal year and that the budget as enacted was balanced.

Wilder's budget was put together assuming the real estate tax rate would be $1.23 -- a rate he had said the city couldn't afford to cut in the current economic climate and that the council went ahead and cut anyway. The rate is set in separate legislation than the budget, and Wilder's budget does not supercede that.

The rate cut means there will be $6 million less in revenue than Wilder's budget is counting on.

"They tell me there's a lot of low-hanging fruit," Wilder said, when asked about spending cuts to bring the budget back into balance.

"I tend to agree the budget he proposed did have millions of dollars of excess spending in it," Council President William J. Pantele said. "That's why the council made the changes it did."

Wilder ruled out across-the-board cuts, such as a simple order to department heads to cut spending by 1 or 2 percent.

And he criticized as "simplistic" the council's attempt to save $1.6 million in its budget version by adopting some of the city auditor's recommendations to clean up the city's purchasing and bill-paying operation.

Wilder said he would not target the council's staff or offices, such as the city attorney, city auditor and city assessor, that come under it.

"I'm not targeting. If we can save money on staff, they can save money on staff. Everybody comes under scrutiny."

Contact David Ress at (804) 649-6051 or dress @timesdispatch.com.