Cr Giacomo Arnott said he was so outraged by the price tag that he was compelled to put forward a motion that the vehicle be sold and a cheaper one purchased.

He received support from his three Labor Party colleagues Leah Anderson, Peter Francis and Jason Wells, but the motion was defeated five votes to four.

"We're in a midst of a cost of living crisis and the ratepayers have just paid $86,000 for a top of the line Ford Ranger Raptor," Cr Arnott said.

In response, Mayor Palmer said that the purchase of the brand new vehicle was made in line with the relevant policies and procedures, taking into consideration potential financial implications.

"I'm incredibly disappointed that the purchase of this vehicle has been turned into a political issue, however, I understand the concerns of the community and the perception created," he said.

"The council doesn't have a set price for the purchase of mayoral vehicles, however all purchases are managed under the council's Payment and Provision of Facilities to Mayor/Councillors Policy that was unanimously supported by all councillors in January this year.

"The previous mayoral vehicle was a Jeep Cherokee purchased in October 2017."

The $85,974 price tag of Cr Palmer's vehicle, which appeared in the council financial report under the title 'Fleet', was discovered by newly elected east ward councillor and mayoral nominee Leah Anderson.

The vehicle was purchased from Port Macquarie dealership Andrew Miedecke Motors.

When questioned about the car model, the council's facilities and services manager Greg Kable said that historically the council had provided a mayoral vehicle "of a similar standard set years ago ... a premier standard for mayor and general manager ... similar to a Statesman".

Questioned why the vehicle had been purchased from Port Macquarie and not through a Port Stephens dealership, Mr Kable said that fleet purchasers were made through an open tender process and that there was no cap on the price.

The community reaction began with comments at the meeting and escalated following a social media post from Cr Arnott, who said he did not dispute the mayor's entitlement to a vehicle funded by the ratepayers.

"But my concern is finding out that the mayor has complete discretion as to which vehicle he chooses," Cr Arnott said.

"It's no secret that the council's financial position is worrying as we look into the next few years, to the point that the council has started a financial sustainability committee to look at ways to save money.

"To me it's incredible then that the mayor has used his discretion to purchase an $86,000 vehicle using rate funds. The vehicle even has the 'Ford Performance blue paint job'.

"The car was purchased from a dealer in Port Macquarie, meaning this awful over-spend didn't even benefit a local business."

Mayor Palmer said that mayoral vehicles were generally renewed each term of council and that fleet purchases were made in consideration of a whole of life costing.

"The contract amount disclosed in the council report was GST inclusive, as council is exempt from GST the actual purchase price was $77,213. Based on this current term, the resale price for the vehicle is estimated at $63,000," he said.

"This represents a capital cost to the council of $4,700 per annum over the three years."

He added that any personal use of the vehicle was paid for by himself at a rate of 72c per km.

During the council meeting Cr Arnott lodged a motion directing the general manager to sell the car on Car Sales, where full purchase price will likely be recouped, and to purchase a smaller car, less expensive car to perform his mayoral duties.

The motion was lost 5-4 when the mayor voted with councillors Chris Doohan, Steve Tucker, Matt Bailey and Glen Dunkley.

"It's not too late for the mayor to do the right thing and get rid of this ridiculous use of ratepayer funds and lead by example with modesty in a financial crisis," Cr Arnott said.

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