BY DAVID RESS

Times-Dispatch Staff Writer

Richmond Mayor L. Douglas Wilder indicated this afternoon that the city is operating under his budget, not one adopted by the City Council.

Wilder and the council have clashed over the spending plan. Wilder says the council's plan is invalid because it missed a key deadline, but council members say they acted properly.

The first day of the city's new fiscal year began with Wilder administration officials refusing to say whether Richmond's city government is operating under the mayor's budget -- which included $3 million of mainly administrative and procurement spending that City Council cut -- or a competing council version.

"It is what it is," said Linwood Norman, a Wilder spokesman, when asked whether the mayor's budget is in effect.

Later, when asked directly, Wilder would only say: "What else could it be?"

Meanwhile, the city's retirement system said it will go ahead and pay a 1.5 percent cost-of-living adjustment for retirees that the council authorized, but was not in the mayor's budget.

"The city attorney has rendered an opinion which rendered the City Council's adopted budget as valid and lawful," said Richmond Retirement System Executive Director Philip Langham.

Langham said that based upon the advice of the Retirement System Board of Trustees' legal advisor and the city attorney, the agency is obligated to obey the council action authorizing the 1.5 percent cost-of-living adjustment for retirees this year.

Council members today are scrambling to find out what's in the budget and determine what action they may take to resolve the dispute.

Wilder has said the council budget was invalid because two measures required to balance it were not enacted before a May 31 deadline. The council and the city attorney said the council passed a balanced budget and that the two measures involved spending cuts for the just-completed fiscal year rather than revenue for the fiscal year that started today.

Council members believe the mayor's budget is out of balance because it does not reflect a cut in the city's real estate tax rate that the council enacted.

Contact David Ress at dress@timesdispatch.com