EVERETT — Ray Stephanson Friday gained enough votes from absentee ballots to win the Everett mayoral election.

Stephanson led incumbent Frank Anderson by 195 votes going into Friday’s count of more than 3,500 absentee ballots from Everett that had not arrived at the Snohomish County elections office by Tuesday morning.

Stephanson’s lead widened to 262 votes Friday. He is now winning 7,555 to 7,293, with only several dozen votes left to count.

Because there are still votes that haven’t been tallied, Stephanson declined to declare victory Friday night. "I’m very honored and humbled if this trend continues" was all he would say.

But Anderson acknowledged Friday that he had lost.

"The people have spoken," Anderson said. "We are going to be very cooperative in the transition."

Anderson said he has no plans to run again for political office.

"I’m 65 years old, and I’m not going to put myself through another campaign," he said. "But I can hold my head high. I ran an honest, high-road campaign. My integrity is worth more to me than the mayor’s job."

Anderson declined to say Friday whether he was implying that Stephanson did not run a high-road campaign. But during the campaign, he accused Stephanson of levying deceptive charges.

Stephanson will take office Nov. 19, after the election is certified, and he’ll preside over his first City Council meeting that night.

He will immediately face the difficulty of working with a council that may be initially hostile toward him.

Council members are still seething over Stephanson’s campaign charge that the 2004 budget is fiscally irresponsible. Stephanson used council members as "punching bags" to drag down Anderson, Councilman Mark Olson said.

"The council took great offense at him misrepresenting the city’s financial situation, and at the manipulation and misuse of financial data to make an argument that was kind of false from the beginning," he said. "He needs to take steps immediately to build the council’s trust."

Stephanson Friday defended his campaign materials.

"There’s nothing in our campaign that I raised that wasn’t a legitimate issue," he said.

He said he looks forward to "a very positive relationship" with the council.

Six of the seven council members supported Anderson and took out an ad last week that accused Stephanson of misleading voters about the budget. One of them, Dale Pope, was defeated Tuesday by Stephanson supporter Brenda Stonecipher, but he will still be in office until Dec. 31 for what could be contentious debates over the budget.

On Wednesday, the City Council voted 6-0 — with Stephanson ally Bob Overstreet absent — to tentatively support the 2004 budget, which includes the use of $4.8 million to fill the gap between revenues and expenses. Stephanson vows to cut enough spending from the $96.2 million operating budget to avoid using any of the $23.8 million budget surplus.

Councilman Doug Campbell said the budget already has "been trimmed and trimmed and trimmed. There isn’t a gross amount of fat in this budget."

Cutting $4.8 million from a budget in which more than 70 percent of expenses go to fund employee salaries and benefits "would equate to a tremendous amount of employees," Campbell said.

Stephanson said he hasn’t decided how to make the cuts or whether to try to cut spending before Dec. 10, when a final vote on the budget is scheduled, or to make changes later on.

"It’s very premature without having a chance to look inside the budget and talk to staff and council to figure out what the options are," he said. "But layoffs are my avenue of last resort."

The council will have the final say on the budget. Even after Pope is gone, council members who opposed Stephanson’s election will enjoy a 5-2 majority — enough to override a Stephanson veto, if necessary.

Stephanson will be the third mayor in Everett in less than a year and a half. Ed Hansen resigned July 1, 2002, to become general manager of the Snohomish County PUD, and Anderson — who was council president at the time — replaced him.

Tuesday’s vote was to complete the last two years of Hansen’s four-year term, so Stephanson will face another election in November 2005 if he wants to keep the job.

Friday’s count also put an end to another close contest, this one between incumbent Campbell and challenger David Simpson. Campbell’s 326-vote lead on Tuesday widened to 419 votes.

Friday’s results are unofficial and don’t include several dozen ballots that had either questionable signatures, were cast at the wrong polling place or came into the elections office after Friday morning. Those ballots must be verified one by one, and some will be disqualified, said Carolyn Diepenbrock, Snohomish County elections manager. They will be counted by Thursday.

Stephanson will earn $122,832 a year and oversee a workforce of nearly 1,100 and a total budget of $339 million.

Reporter David Olson: 425-339-3452 or dolson@heraldnet.com.