The Andalusia City Council on Tuesday approved a $19.2 million budget than includes $17.8 million in expenditures in FYE 2018-19, which begins Oct. 1.

Mayor Earl Johnson said the budgeted expenses are approximately 2 percent over last year’s budget.

“That’s lower than the rate of inflation,” he said.

City employees will receive a one-time, 3 percent cost of living raise, the mayor said.

“We are happy to be able to do that. Our employees have been a couple of years without a raise, and our folks work awfully hard.”

By the next fiscal year, he said, the city’s new personnel pay plan and raises will be in place and will effectively do away with cost of living raises.

The budget also allows the city to maintain adequate reserves.

“That is necessary to maintain our excellent credit rating with Standard and Poor’s,” he said.

The budget includes $250,000 in contingency funds, and $1.16 million for its capital improvement account.

“If you take into consideration the great results from our audit, and being able to add to reserves, the City of Andalusia is in the strongest financial position ever.”

It is also the earliest the city has adopted a budget for the new fiscal year.