Councilman Mark Jordan argued many town residents aren't getting raises at their jobs, and state employees might be facing layoffs next year.
"Any increase that we give to our employees is going to be money out of the pockets of our taxpayers," he said.
Councilwoman Joann Dawson said she would like to give out a raise, but also doesn't want to overextend the town and force layoffs down the road.
"I am extremely nervous about promising something we're not able to give," she said.
Messina said he would be willing to compromise on the step increases, but was clearly reluctant to budge on the 1 percent raise. He argued employees in other area municipalities are, in some cases, seeing 3 or 4 percent raises.
He also argued the 1.8 percent tax increase in his budget is relatively small, especially given a proposed 15 percent Albany County hike.
"I think the people of Bethlehem are willing to pay a slight increaseif they see us doing our jobs," he said.
Kotary was especially adamant about taking the tax hike to zero, though.
"People are taxed enough in this state," he said. "They can afford to pay more, but that doesn't mean they should."
Closing this year's revenue gap also saw debate. The town budgeted for receiving more sales tax than is coming in, and even with the situation improving every quarter receipts are still expected to fall something like $350,000 to $400,000 short.
Messina has proposed making up the gap with the town's reserve savings. The 2010 budget already dips into those funds to keep the tax levy down. Messina argued even by using this extra money, the town would have more than 15 percent of the total budgeted amount left in savings.
Board members, however, have criticized this strategy as short sighted. Several argued town spending is growing out of control and must be reined in. Kotary argued there has been a steady increase in expenditures"actual, expected and planned"from 2009 to 2011.