SACO — The City Council decided Monday night not to terminate the contract of the city administrator, despite a push from several elected officials who questioned the process under which the contract was negotiated last summer.

Richard Michaud, the city administrator since 1999, announced last summer that he would retire, but city councilors who support him persuaded him to stay by negotiating a new incentive-laden contract. But that contract was negotiated while Mayor Don Pilon was out of town, angering him and raising concerns for two city councilors, who questioned the process and ultimately refused to sign the new contract.

After a two-hour discussion Monday that included both public support for Michaud and calls for councilors to be more transparent with city business, the council voted 4-2 against the motion to terminate the contract. Councilors Bette Brunswick and Nathan Johnston voted to terminate the contract. Councilor Leslie Smith Jr. was absent from the meeting.

Brunswick, who voted against the contract, made the motion to terminate Michaud’s contract effective March 16. Pilon supported the effort to terminate the contract and has hired a lawyer to represent his interest at meetings.

The new contract allows Michaud to live outside Saco and drive a city-owned car, and pays him more than $121,000 a year. The city also contributes the equivalent of 12 percent of his salary to his retirement plan. He also used a city-owned car under his previous contract.

“We expressed to him that we thought he did a great job and we wanted him to stay for a few years,” Councilor Eric Cote said last week. “We simply didn’t want to mess around with transition.”

Michaud retired from his position at the end of December, took January off and began working under his new contract on Feb. 1. He now collects a pension from the Maine Public Employees Retirement System.

The new contract was negotiated during an executive session in August when Pilon was out of town, leading to his accusations that the council circumvented the provision in the city charter that says the mayor appoints a new administrator and the council may confirm the appointment.

A city attorney, Timothy Murphy, has provided councilors with a written opinion that the city administrator’s contract is “lawful and enforceable.” He said the mayor’s appointment – in practice, a recommendation because the council ultimately confirms a new administrator – was not needed because Michaud was not a new hire.

Councilor Kevin Roche – who initially voted against the contract but voted Monday to keep it in place – said postings on social media fueled intense interest in the situation. During the public comment portion of the discussion, nearly 20 residents alternately praised Michaud and questioned the deal that was negotiated to make him stay.

Former Mayor Ron Michaud, who was speaking for himself and on behalf of former Mayor Bill Johnson, said Michaud has led the city through contentious issues and his contract should not be terminated.

“He has worked each and every day to make Saco one of the best-run cities in the state. No amount of money can buy the expertise and knowledge he brings to the table,” Ron Michaud said. “There was no giant conspiracy. The council did what they thought was best for the community.”

Resident Roland Gagne questioned the process undertaken by the council to entice Michaud not to retire. He said he was concerned that the mayor “obviously was left out of the loop.”

“There’s something about this that just doesn’t seem right,” Gagne said. “It just doesn’t feel like it was done like it should have been done.”

Murphy, the city attorney, answered questions from the council and reiterated his opinion that the contract is legal and would not be undone if challenged in court.

“It’s not a conspiracy,” he said.

The discussion about Michaud’s contract has revealed a split between the city administrator and mayor, with councilors saying it is an open secret in the city that the two do not always get along.

“There is no way in heck I would ever vote to get rid of (Michaud). We need someone to keep an eye on the mayor,” Councilor Arthur Tardif said.

Roche said that Pilon and Michaud have not carried out a section of Michaud’s contract that requires the two to develop an annual work plan and set performance standards to evaluate the city administrator’s performance. In a motion that was unanimously supported by the council, Roche proposed requiring the pair to develop that plan by April 1.

Roche said he believes it is time for the city to set aside the issue of Michaud’s contract and move forward.

“I just want the emotions to temper down,” he said.