North Stonington - Voters approved both the town and school budgets for 2014-15 at Monday's referendum but each passed by fewer than 20 votes.

The $5.6 million general government budget passed 236-222 and the $12.7 million Board of Education budget 236-223. First Selectman Nicholas Mullane said he was glad the budget passed, but added that he was "not surprised" by the close vote.

Although the general government budget is less than the current budget and the school budget hasn't increased, Mullane believes residents are concerned about the economy.

"Southeastern Connecticut is coming back slow," he said, and people are worried about the job market and the ability to shoulder a tax rate increase. "I can understand the closeness of it and the concern of the voters and taxpayers."

Despite the overall budget decrease, Board of Finance chairman Daniel Spring told voters at a town meeting last week that the board is considering a 25.85 mill tax rate, a 0.9 percent increase from the current tax rate.

That increase would help get the town's finances in shape by increasing the undesignated fund balance, which was 2.5 percent of the budget at the end of the last budgeting period. The town's auditors said it should be between 7 and 10 percent, said Spring, who added that the proposed tax rate increase does not account for the $6.33 million project to build a new emergency services complex or the proposed $41 million school building project.

The Board of Finance will set the tax rate Thursday during a 7:30 p.m. meeting at Town Hall.

k.catalfemo@theday.com