Knightdale — Residents here could see a two-cent tax increase, according to discussions about the 2008-2009 budget by the town's finance committee.

The committee is reviewing a budget forecast prepared by Finance Director Ren Wiles.

Wiles on Wednesday reported cost estimates to operate town government and to provide services for residents.

Committee members include chairman and Mayor Pro Tem Mike Chalk, Councilman Tim Poirier and Mayor Russell Killen. Assistant Town Manager Seth Lawless and Wiles represent town staff.

The discussion does not mean there is a proposal on the table, but it is an indication of what budget planners are thinking.

Based on Wednesday's discussion, the town’s tax rate could be set at 40 cents on every $100 in property.

A 38-cent rate is the equivalent of the current 50-cent rate. The lower figure is due to revaluation of property.

Municipalities are now required by law to show what the equivalent tax rate would be considering revaluation of property, which occurs every eight years.

Wiles said he expects property taxes to bring in about $3.8 million.

The budget forecast includes re-enforcing the town's fund balance — or savings account — by $30,000. Growing the fund balance is one of Killen's priorities.

Members of the budget committee said the two-cent increase would help pay for a new fire station on Hodge Road and six new firefighters.

Committee members cut $35,000 from the capital outlay forecast for software to create computerized town council agendas. They also cut $13,000 for a new vehicle for the Planning Department. Plans now call for the code enforcement officer to get the Jeep Cherokee Fire Chief Tim Guffey uses. Guffey would get a new vehicle.

Wiles said Guffey needed a bigger vehicle to store plans of all major developments in the back of his vehicle in the event of a fire at one of them.

Chalk questioned the number of new computers in the forecast. Wiles said the town had a computer replacement policy that calls for computer upgrades every five years.

Chalk said those with less complex computer needs didn’t need upgrades that often.

Killen suggested that to save money, the town could implement a department replacement policy, which would allow for needs of each department, rather than a more general policy.

The forecast has town employees receiving a 4.5-percent cost of living increase. The rate is tied to cost of living increases of the Consumer Price Index, Wiles said.