Farrell council members Monday lauded city employees, including police and firefighters, who have agreed to wage freezes for 2010, as officials deal with their greatest fiscal challenge since Sharon Steel Corp. closed almost two decades ago.

The freezes are one of the reasons the city’s 2010 budget doesn’t include a tax increase.

“As the city’s revenues have declined, it has become apparent that tough decisions have to be made,” City Manager LaVon Saternow wrote in the budget message she presented to council a month ago.

Those tough decisions are apparent in the $2.78 million spending plan council approved on first reading Monday. More cuts could be made to the plan, which will be formally adopted when council meets Dec. 21.

Southwest Mercer County Regional Police approved the proposal not to raise wages, despite being in the second year of a three-year labor contract, Councilman Lou Falconi said.

“That’s obviously going to save (money),” Falconi said.

The city is also increasing the amount of rent it charges the department, along with the rent it charges Mercer County Regional Council of Governments to operate a lockup in the city building.

Southwest’s rent will rise from $700 a month to $1,000 a month and COG’s rent will rise from $800 to $1,200 amonth, Mrs. Saternow said.

The increases were calculated after city officials analyzed how much it costs to keep the building open, she said.

“Frankly, the amount was way under what it should have been,” Mrs. Saternow said.

Six members of the American Federation of State, County and Municipal Employees have also verbally agreed to a wage freeze, as have 11 full-time and 17 to 20 part-time nonunion employees.

Councilman Bob Burich brought up further budget cuts, including halving the $6,000 council budgets for official travel. Falconi agreed and the cut was made. In 2009, council budgeted $6,000 for such expenses and thus far has spent $9,972.

Such over-spending won’t happen next year, Burich said. Once the $3,000 that’s budgeted has been spent, further requests will be denied, he said.

The proposed general fund budget totals $2.78 million and keeps property taxes at 24.67 mills. Resident wage taxes remain at 1.8 percent and nonresidents pay 1.4 percent.

Expenditures have been cut $5,000 from 2009, Mrs. Saternow said.