Mebane council keeps tax rate flat, rejects proposed increase

Mebane homeowners will not pay the higher property-tax rate City Manager Richard White proposed, after the city council voted 4-1 Monday night to keep the city rate at 37 cents per $100 of valuation. That means the city portion of property tax bills stays flat for now, even as Mebane continues to lean on reserves and higher fees to cover a spending plan shaped by growth and capital needs.

The council did not throw out White’s budget wholesale. It preserved the broader spending plan but stripped out the tax increase he had first proposed, then revised into a split approach with 1 cent for the general fund and 1 cent for capital projects. White’s original budget would have raised the rate from 37 to 39 cents. Earlier budget figures showed each penny on the tax rate is worth about $505,162, and the city’s property tax at 37 cents was expected to generate about $19.3 million.

Jonathan White made the motion to eliminate both parts of the increase, arguing the split did not give staff clear direction and that he could not support even a small hike without a longer-term plan. Montrena Hadley, Sean Ewing and mayor pro tem Tim Bradley backed him, while Katie Burkholder voted no. Burkholder said the extra penny for future capital projects should have been raised to 3 cents instead of being removed.

The vote left intact several other parts of White’s budget, including 10.5 percent water and sewer rate increases, a 3 percent cost-of-living adjustment for city employees, and higher city subsidies for employee medical and dental coverage. It also preserved the manager’s recommended council and mayor pay raises: 10 percent for council members, 15 percent for Bradley and 20 percent for Mayor Ed Hooks.

The budget still carries a significant draw from city savings. White’s plan will use an additional $554,736 from fund balance, bringing total reserve use to about $2.2 million this year. That gives the no-tax-hike decision a real fiscal cost, even with the property rate unchanged.

White has said his broader budget included $6 million for a fourth fire station and $1.5 million to buy land for a southside park site on West Ten Road, underscoring that the tax debate was tied to long-term capital needs as much as day-to-day operations. The 4-1 split also showed that the argument is not over in Mebane, where the pressure to keep taxes stable continues to collide with the cost of new services, facilities and staffing.