City manager proposes $65M FY27 budget, recommends 2¢ property tax increase and 10.5% utility rate hikes

City Manager Richard White presented his recommended fiscal year 2027 budget to the Mebane City Council on May 4, outlining a $65 million spending plan that would raise the property tax rate by two cents and increase water and sewer rates. "This budget recommends a 2¢ tax increase," White said, and he projected the levy would generate about $1.1 million in additional revenue aimed at debt service for a tiller truck, Fire Station 4, and a public works shed.

White said the proposed general fund expenditures total $46.7 million and the utility fund would be budgeted at about $18 million. He told the council the median Mebane home value is $395,580 and that the recommended 2¢ increase would raise the median property tax bill by about $79. "So a tax bill would increase by $79," he said.

Why it matters: the recommended increase would fund planned capital projects and rising operating costs. White said the budget includes nine proposed new positions — including three firefighters to staff the planned Fire Station 4 — a 3% cost-of-living adjustment for employees and higher retirement and health insurance costs that together push personnel expense higher.

In the presentation White highlighted key capital items: a proposed Fire Station 4 (roughly $6 million), a public works shed ($1.57 million), site fill for Community Park Field 1, and utility investments including payments tied to the Graham wastewater treatment arrangement. He also noted projected debt-service impacts, saying staff used a 5% placeholder interest rate for planning because final rates are unknown.

Council questions and next steps: council members asked for at least one-page alternatives showing the trade-offs between different tax-rate options, fund-balance usage, and what a 1¢ or no-tax-rate-change budget would look like. Council agreed to a budget workshop on May 13 and scheduled a public hearing for the budget on June 1. White agreed to supply comparative scenarios and additional detail for the workshop.

What was not decided: the council did not adopt the budget on May 4; the presentation was the manager's recommendation and further direction and final adoption are scheduled in June. White emphasized the council can choose alternative mixes of tax-rate adjustments, use of fund balance, or scaled capital plans at the workshop.