PALOS HEIGHTS, Ill., July 19 (AP) - The mayor vetoed a measure to pay a Muslim group $200,000 to drop plans to convert a church into a mosque, calling the proposal ``fiscally irresponsible.''

Mayor Dean Koldenhoven, who had previously called the City Council plan ``embarrassing'' and an insult to Muslims, struck it down Tuesday night. The proposal has raised issues of religious bigotry in this mostly white and Christian south Chicago suburb of about 12,000 residents.

After the veto, the Rev. Edward Cronin, a local Catholic priest, called for the community to ``heal the hurt.'' He said the debate has made Palos Heights appear bigoted and intolerant of non-Christian religions.

``There may be some truth to that perception,'' he said.

Many of the town's 450 Muslim families attend an overflowing mosque in Bridgeview, a few miles to the north. They had agreed to purchase a Christian Reformed church for $2.1 million, but met with resistance from residents and some council members.

At one City Council meeting, a resident suggested that Muslims needed to be converted to Christianity and told them to ``go back to your own countries.'' Council members maintain they want the city to buy the church instead so it can be converted to a recreation center annex.

The council eventually came up with the plan to give the group $200,000 to cancel the sale.

The council decided not to try to override Koldenhoven's veto. Rouhy Shalabi, an attorney for the Al Salam Mosque Foundation, did not attend the meeting and was not available for comment. He has said the foundation might sue if the city rescinded the offer.

``I must do what I believe is best for the city,'' Koldenhoven said. At least two residents called for the mayor's resignation. ``It was wrong to call the residents of this community racist,'' said Michael Patt, pointing at the mayor.

Several others spoke in support of Koldenhoven. ``If he doesn't get re-elected, at least he'll be able to look at himself in the mirror,'' Eind Matariyeh said.

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