A House bill would allow Chapel Hill to experiment with publicly financed campaigns.
The bill would allow the Town Council to run a pilot project and turn in a report on the results to the legislature.
Rep. Verla Insko, a Chapel Hill Democrat and one of the bill's sponsors, said it would help the town recruit a more diverse pool of candidates for Town Hall.
The town of Cary began a public financing campaign in 2001 but it was later declared illegal by the State Board of Elections.
Rep. Paul Stam, an Apex Republican and the House minority leader, said he would vote against the bill and any other public campaign financing on principle.
"Practically speaking, it means taxpayer money someday will be going to highly offensive advertising," he said.
The bill passed 65-51 and now heads to the Senate.