Kenbridge will hold a public hearing Tuesday, on a proposal to issue up to $511,000 in general obligation bonds to fund, in part, improvements to the town’s water system.

The public hearing on the proposal to take on the general obligation debts will be held 9 a.m. Tuesday, on the second floor of the Kenbridge Community Center on East Fifth Avenue. Copies of documents related to the financing of the project are available for review at town hall.

Money raised through the issuance of the bonds would pay for rehabilitation and replacement of the sewer systems sanitary sewer collection operation, pay for some previous improvements to the plant, and cover the cost of issuing the bonds.

“This project consists of repairing and-or replacing all the pump stations located throughout the town,” said Robyn Fowler, the town manager. “The town applied for grants but unfortunately, the bids came in higher than grant awarded, so the Town had to apply for additional funding to cover the difference.”

General obligation bonds are commonly used by governments to fund projects that generally do not generate money, but benefit the entire community.

The use of general obligation bonds are secured by a localities pledge to repay the debt, usually through taxes. Beyond its tax revenues, the town could promise to use any net revenues it derives from the sewer system to repay the debt.

No tax increases are planned at this time, but the town had to raise the sewer rates to help cover the cost, and they will be raised again in 2016 and 2017 by $1.93 each time, Fowler said.