Citing the city's "goal of effective municipal leadership," the Cambridge City Council voted last night to extend the contract of City Manager Robert W. Healy through the middle of 1997.

Councillors decided by an 8-1 margin to accept the September 26 proposal of Mayor Kenneth E. Reeves '72 to renew the contract. Only Councillor Katherine Triantafillou voted against the extension.

The extension has been the subject of debate among councillors and civic leaders for the last three weeks.

Officials from Harvard, MIT and the Cambridge Chamber of Commerce have endorsed the manager for his fiscal acumen which, they say, has helped produce an annual surplus in the city budget.

But members of the Cambridge Civic Association (CCA)--the city's left-wing political organization--said last night they oppose the format of the current contract.

R. Philip Dowds, CCA president, said the group supports a contract with infinite duration which would include a one-year severance package if the manager were dismissed.

Supporters of Question 9, the ballot referendum which proposes elimination of rent control, have criticized a plan Healy issued earlier this month that would moderate the referendum's impact on rent-control tenants.

Dowds called last night's council vote premature because Healy's contract was not originally due to expire until June 30, 1995.

"I honestly don't know why we are suddenly fast-tracking his contract, especially at a time when it is such a profound question about whether the city is managing its money properly," he said.

In the past, the CCA has suggested that Healy may have behaved unethically in a real-estate loan he co-signed with City Solicitor Russell B. Higley in 1985.

But in a State Ethics Commission investigation in August, Special Investigator Juan DeLeon concluded that no wrongdoing had occurred.

Healy served as assistant city manager from 1974 to 1981, succeeding James Leo Sullivan in 1981. He earns $126, 154 a year.

Discussion of his contract extension took place at an special council meeting last Wednesday, at which councillors and citizens alike voiced support for the mayor.

Yesterday's vote was largely overshadowed by a heated discussion over a Cambridge Chronicle story last week which detailed Reeves's expenses over the past year.

In an interview following the vote, Healy said that, under his continued leadership, the city will maintain its current financial policies, which include a $20 million bond sale which starts this month.

Healey refused to speculate about whether he would seek to extend his term beyond 1997.

"I'm only 51 and I'm not talking about retirement yet," he said.