FAIRHOPE, Ala. - City employees inched closer this week to getting a 2 percent wage hike in the fiscal year that starts Oct. 1.

A financial advisory committee, consisting of citizen volunteers, all five City Council members and the mayor, agreed Monday to add $283,000 to the next draft of the FY 2012 budget, which the council is expected to adopt by its Sept. 26 meeting. That amount will be set aside in the budget for a possible 2 percent raise for all hourly and salaried employees in the city, which the council will vote on later this year.

The sticking point for some committee members over the issue is the outcome of a municipal wage study now underway, as well as the prospect of a worsening economy and its impact on sales tax and other revenue.

That study is expected to answer whether city employees are paid fairly across positions and duties, as well as whether they are over- or under-compensated relative to similar positions in other cities of a comparable size.

Committee members also discussed whether the raise should be merit-based or across-the-board.

“This will all come to the council later on,” said Council President Lonnie Mixon, summing up the issue.

The upshot is that funds will be set aside for a possible raise, which the council is expected to take up before the end of the calendar year, after the wage study is complete and in light of the current economy.

“I think we’ve got to consider the morale of employees in the city which I understand is very low,” Mayor Tim Kant said at the Aug. 15 meeting. “I do think we’re on the right track by taking a cautious approach to the future.”