Robert A. Rizzo, who has served as the city's interim chief administrative officer since mid-May, will take over the position permanently Sept. 1.
The City Council unanimously approved an agreement with Rizzo at its regularly scheduled meeting Monday night.
Rizzo, 39, will receive a salary of $78,000, which is $7,000 less than that of his predecessor, John Bramble, who left to become head administrator for Adams County, Colo. Rizzo will receive no car or expense allowance.
The lower salary reflects the city's troubled economic state, Mayor Ray Johnson said.
"We were very forthright with him, and he seemed to appreciate that the city is going through a period of tight financial planning," Johnson said. "We feel it's a fair salary but all that we could afford at this time."
Rizzo will manage a budget of about $12 million and a staff of 92 employees in the city of 34,000 residents.