Two incumbent Oak Bluffs selectmen — Duncan Ross and Ron DiOrio — held off a strong showing by challenger Hans von Steiger yesterday in the annual town elections, as each won a second term on the five-member board.

All three candidate campaigned on a platform of fiscal reform and economic development, a theme which dominated both the special and annual meetings held earlier this week and to be continued in a third night meeting set for Monday at the Oak Bluffs school.

Voters opted to stick with Mr. Ross and Mr. DiOrio, who both are completing their first term on the board of selectmen.

Mr. Ross is a former town moderator with a full three-year term under his belt, while Mr DiOrio is a relative newcomer to town politics, having won a special election in August of 2006 to fill the unexpired term of former selectman Michael Dutton, who is now town administrator.

Mr. Ross received 521 votes; Mr. DiOrio received 499 votes and Mr. von Steiger received 420 votes.

Total turnout on a sunny and bright day was 885, or about 29 per cent of registered voters.

Following the election, both candidates said voters responded to their message the town must cut costs while boosting revenue, a concept that jumped to the forefront of public attention recently after the town’s initial budget was unveiled with a deficit of $2 million.

Although finance officials have since reduced that figure, voters this year are still facing overrides and debt exclusions totaling almost $1 million.

“People feel it costs too much to live in this town, and I realize things have changed. Finding ways to cut costs and drive up revenues must be a priority,” Mr. Ross said.

Mr. DiOrio said he would continue to pursue payments from nonprofits located in Oak Bluffs that serve the entire Island as a means to expand the town tax base.

“All you have to do is look at what it costs to maintain the same level of services to realize we must change the way we do business. Some people still think its a sin to ask these nonprofits for some type of payment in lieu of taxes, yet Oak Bluffs gives them the land and the entire Island makes out,” he said.

Mr. von Steiger, a town wastewater commissioner who also won a seat yesterday on the finance advisory board, said the town election was a mixed bag. While he was disappointed he wasn’t elected selectman, he was excited about the prospect of joining the finance committee where he could draw on his extensive experience in corporate finances.

“The town has to reign in its expenses. If I had been elected [selectman] I would have pushed for a review the budget several times a year so we know how our dollars are being spent,” he said.

As a member of the finance board, Mr. von Steiger said he would push for a more frugal approach to governing. “A lot of seniors in this town can’t afford to pay their taxes anymore. The days of free spending must come to an end,” he said.

Perhaps the biggest surprise of the contest, if there was one at all, was the election of challenger Gail Barmakian to the wastewater commission over incumbent Richard D. Combra.

Ms. Barmakian, a member of the zoning board of appeals, defeated Mr. Combra, a former longtime selectman, by a vote of 446 to 380. When reached by phone last evening, Ms. Barmakian said she was genuinely surprised by her victory but excited about joining the commission and getting to work.

“I was formerly the public member of the state board of state examiners for plumbers and gas fitters, so I feel I have the knowledge and can help this town. I think we already have a very well run commission, and I look forward to continuing their efforts,” she said.

In another contested race, incumbents Joe Alosso and Michael Perry joined Mr. von Steiger, one of two challengers, in winning seats on the finance advisory board. And in the final contested race, challenger Nancy Phillips defeated fellow challenger Bill McGrath for a seat on the parks and recreation commission.

The incumbent who formerly held the seat, Michael Marchand, opted not to run for reelection.

Ms. Phillips, former chairman of the boardwalk to beach task force and current member of the community development committee, said she decided to run after several park-related issues came to light, including the fray over the use of Ocean Park for the Martha’s Vineyard Festival and the little league proposal at Veira Park.

“I don’t think a lot of people realize what an important role the parks and recreation committee plays . . . I realized the town could do a better job utilizing our parks,” she said.

In uncontested races, moderator David Richardson received 590 votes, town clerk Deborah deBettencourt Ratcliff received 732 votes, longtime school committee incumbent Priscilla Sylvia received 679 votes, and water district commissioner Raymond J. Moreis received 720 votes.