On April 14, the Austin and Lakeway City Councils will hold a joint hearing on a proposed rate increase for Austin Energy customers.

The hearing at 10 a.m. at Lakeway City Hall, 1102 Lohmans Crossing, will give Austin Energy customers in the Lake Travis area a chance for public comment on the proposed rate increase. About 2,100 Lakeway residents and 640 commercial businesses are served by Austin Energy, according to the City of Austin.

Members of the Austin City Council are scheduled to vote on the Austin Energy rate increase May 24 after agreeing to study alternative options at its March 1 meeting. After 17 years of a stagnant base rate, Austin Energy said in September that a $131 million shortfall necessitated a 12.5 percent system-wide rate increase that it hoped to have in effect by January.

But outcry from the Austin City Council, members of the public and advocacy groups curbed the hikes, sending AE back to the drawing board.

In March, Austin City Council considered an alternative 3.5 percent system-wide increase.

However, AE General Manager Larry Weis said a 3.5 percent, one-year interim increase beginning in June would not be sufficient, resulting in a $78 million shortfall by June 2013. He said the utility prefers no interim increase and for council to instead focus on working on a final rate plan.

The proposal was not approved.

In addition to the Lakeway hearing, there will be five work sessions in April on a proposed rate increase at Austin City Hall.