Salt Lake Mayor Palmer DePaulis was expected to sign Monday afternoon the compromise budget drafted in an emergency City Council meeting Sunday, his chief of staff said.

The compromise budget is to replace one DePaulis vetoed Friday."The mayor is in agreement with the council and feels that an acceptable budget can be adopted," Mike Zuhl said.

"I think once we sit down and if they're willing to follow through on a compromise . . . I'd be glad to negotiate the tough issues with them," DePaulis said Monday morning before meeting with council members.

Recognizing it couldn't override the first budget veto since its formation, the council Sunday drafted the compromise $79.6 million budget.

DePaulis and council members were expected to meet in open session at 3 p.m. Monday to consider the budget, but the mayor said he was reluctant to show complete support for the measure before the meeting.

Under the proposed budget, the council erased a $419,846 across-the-board cut on all city services, the principal reason for DePaulis' veto Friday, by changing the city's merit-pay system and trimming other programs.

Savings from the cut were to fund $600,000 in merit raises for city employees. Sunday's plan replaces the merit raises, which only some city employees enjoyed, with $300,000 in once-a-year bonus payments for all.

DePaulis, however, said Monday morning he was still concerned that the city would be unable to fund the less expensive bonus program that the council proposed to replace the merit system.

"I'm still very concerned that we create an expectation of salaries and wages that we cannot fund," he said, adding he would seek a realistic compromise that would not build false expectation among employees.

Removing the governmentwide cut alleviates a constitutional question raised by City Attorney Roger Cutler, who earlier said the council might be acting illegally by not specifying to the mayor where the cuts should be made.

Councilwoman Sydney Fonnesbeck argued the merit system under the vetoed budget meted out only a token few dollars a month to employees, while the $143 bonus was more appreciated.

"And, the bonus is fairer because everyone gets it," said Council Chairman Tom Godfrey.

The council's revamped budget also calls for delaying development of the Riverside parking project and development at Sunnyside Park, both of which will save the city $100,000 this year.

Although as of Sunday the budget still stood $11,500 to 39,500 in the red, Godfrey was confident a balanced budget could be achieved during Monday meetings with DePaulis.

State law requires a city budget be adopted by Wednesday, although Councilwoman Florence Bittner plans to leave on vacation Tuesday.

The council developed the budget package at an emergency meeting Sunday afternoon in City Hall while DePaulis rubbed elbows with his colleagues and Democratic presidential candidate Michael Dukakis at the U.S. Conference of Mayors.

The agreement reached Sunday, achieved over raised voices and four hours of debate, is not yet written in stone and must be formally voted on by the council and finally approved by DePaulis, perhaps later Monday.

On a 4-3 vote Friday, the council approved a previous budget, which included giving employees merit raises and cutting travel funding in some city departments and a $419,846 governmentwide reduction.

DePaulis said the across-the-board cuts might result in reductions in numbers of public safety and other city positions and "restrict our ability to provide services," he wrote the council.

Objecting to the cuts and merit funding, DePaulis later Friday carried out a threat to veto the budget, the first time the move was used since the city's mayor-council form of government was established eight years ago.

"They knew they didn't have the votes," Godfrey said Sunday, which prompted council members to comb the budget for compromises that would satisfy DePaulis.

The council retained a $190,000 crime-prevention unit at the Salt Lake Police Department in the budget, a point of contention for some residents and police officers.

Additionally, the council reduced cuts in some areas of city employee travel budgets, which DePaulis said it had reduced arbitrarily. The compromise budget calls for a 20 percent cut in executive and managerial car allowances instead of a 25 percent reduction.

Council members did not attempt to override another DePaulis veto freezing an ordinance council members approved Thursday to reduce garbage-collection fees effective Jan. 1.