CARRBORO - Town Manager Steve Stewart offered a budget for Carrboro on Tuesday night that would increase the tax rate by 2.86 cents -- about a 4.5 percent increase -- for fiscal year 2007-08.

Stewart told the Board of Aldermen that three of the past four budgets he has worked on for Carrboro have passed with no tax increases.

This year, Stewart presented the board with two options: a budget with a tax rate increase and one without.

He said he did this for several reasons. There are many capital projects and improvements that an increase will help, he said. But he's concerned about the burden of property taxes on homeowners -- who make up more than 80 percent of the town's tax base.

"So I don't talk about it lightly when I talk about tax increases," Stewart said.

The current budget totals $17.4 million. Stewart is proposing a $19.1million budget for fiscal year 2007-08, an increase of about 10 percent.

The current tax rate is 62.4 cents per $100 valuation, which means that the owner of a house valued at $200,000 would pay about $1,248 in town property taxes.

With the proposed tax rate increase, the rate would be about 65.26 cents per $100 valuation. That would mean the owner of a house valued at $200,000 would pay about $1,305 in taxes.

"I think it is significant and admirable that you're not coming to us with an even larger tax increase," said Alderwoman Jacquie Gist. Alderwoman Joal Broun agreed.

The tax increase would go toward such capital needs as getting replacement vehicles and equipment that help provide such services as garbage collection, police patrol, fire suppression and maintenance of streets and parks.

Other capital needs are reconstructing Weaver Street, routine street resurfacing, replacing the bathroom facilities at Wilson Park and other park maintenance costs.

Mayor Mark Chilton asked whether the budget could include some way of helping part-time town employees pay for health insurance. They are currently not receiving health benefits that full-time town employees are.

The key budgetary and economic drivers were slow population growth within the town, which directly affects several revenues, such as the property tax base and sales tax revenue, Stewart said. He estimated that Carrboro's population had grown by 6 percent from April 2000 to July 2005.

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