HOLLY POND — Holly Pond town leaders will meet next week to weigh a potential across-the-board sewer rate increase, as well as to examine instituting impact fees for future commercial sewer customers.

On the table is an ordinance that could raise the monthly cost of sewer service for Holly Pond customers by 20 percent, in the first of what could be a staggered series of additional rate bumps that the town council could decide to implement in the years ahead. The council debated passing the 20 percent increase at its regular meeting Monday, but instead decided to take up the matter — with additional information in hand — at a specially-called meeting set for May 10.

The town contracts with Birmingham-based Living Water Services, LLC to operate its waste water treatment system, which was designed and constructed in the mid-1980s. Living Water general manager Tyler McKeller told the council Monday that the system is aging, and that the town’s current rate structure — among the lowest in the state — is unlikely to support the cost of significant needed repairs.

That includes one $20,000 fix that’s currently underway to replace failed aeration components at the treatment system’s oxidation ditch, as well as at least two other future repairs to address what McKellar described as “critical infrastructure failures.” Even with those fixes made, he added, Holly Pond’s waste water treatment systems is likely to need a more substantial overhaul in the years to come, as the town grows and takes on more commercial and residential customers.

The discussion of raising rates comes against a backdrop of historically low fees at Holly Pond, including the complete absence of any impact fee guidelines for new commercial sewer customers. As in the past, the town currently does not charge new commercial customers the one-time impact fee that municipal systems commonly assess for new sewer tie-ons from restaurants, retail stores, and industries. Those fees are typically negotiable with business owners as a function of the anticipated load on the waste water treatment system their operations are likely to incur.

That’s another way of saying that a restaurant or industry that discharges a high volume of waste water usually pays a significantly higher impact fee than a small retail store whose waste water output differs little from a residential user.

The council’s May 10 meeting will offer a chance to discuss what kind of impact fee structure Holly Pond might institute, as well as one or more rate increases for monthly sewer customers. McKeller told the council Holly Pond’s monthly minimum residential charge of slightly more than $12 is the lowest he’s seen among the Alabama municipalities that his company services.

With both residential and commercial growth expected to increase on the county’s east side in the years ahead, grappling with rate increases to fund sewer upgrades is “a great problem to have,” he said, if the town can strike a balance between generating sewer revenues and keeping its monthly rates competitive with other similarly-sized Alabama systems.

The council will take up the rate increase, as well as discuss a separate matter concerning the sale of two pieces of municipal property, at its specially called meeting, which is set for 6 p.m. on Monday, May 10 at the Holly Pond Town Hall.