Current and potential future Brookhaven residents would becounted on to share in paying for over $14 million in water andsewer improvements should a city annexation be approved.

What those improvements would mean in terms of higher water andsewer rates or property taxes was the focus of much debate Thursdayas the city’s annexation trial moved toward a conclusion.Participants were hopeful that the trial would end Friday.

In the trial, the city is asking to annex more than 16 squaremiles of territory. However, more than 200 objectors havechallenged the city’s ability to meet expansion-relatedobligations.

The day began with city annexation attorney Jerry Millschallenging totals developed by Kathy Garner, objectors’ urbanplanning expert, that questioned the city’s financial ability tohandle the expansion.

Later Thursday, objectors’ attorney Jerry Evans did the same tocity financial planning expert Demery Grubbs. Grubbs has said a”worst-case” scenario would mean a 30 percent water and sewer rateincrease.

Grubbs acknowledged an Evans point that a rate increase, howeverlarge, would impact customers in both the current city and in theannexation area. The expert said existing city customers would alsogenerate the larger percentage of revenue.

“Based on the total numbers, they’ll be paying a large portion,”Grubbs said. “That’s historically the case with all systems.”

On redirect examination by Mills, Grubbs said existing cityresidents would benefit from new property taxes paid by thoseannexed. He indicated the additional water rates paid by currentresidents and new property taxes paid by those annexed wouldbalance to benefit the new larger city.

“They all become one in the city limits, not separate units,”Grubbs said.

Evans also questioned Grubbs on his projections regardingavailable revenue to cover water and sewer operating expenses inthe new city area.

The expert said the low figure was based on existing systemmaintenance, but that there were other revenue sources — such awater tap fees — to cover expenses. Evans asked if it would be”stretching the limits” to use other revenue.

“No sir, I don’t think it is,” Grubbs said.

Grubbs has also testified that a 30 percent increase would be a”worst-case scenario” in which the city used revenue or generalobligation bonds to pay for the full amount of the project. Hediscussed grants and other revenue sources that could also beused.

Evans pointed out that the city has used bonds in the past topay for water and sewer projects. He indicated that higher waterand sewer rates in place now to pay off those bonds would be rolledover to pay debt service on the new bonds.

While Grubbs discussed water and sewer rates, Garner based herfindings on additional revenue that would be needed to pay forimprovements.

One scenario she calculated had a “worst case scenario” of thecity needing 252 percent more in revenue. Other scenarios showedrequirements of over 100 percent more in revenue.

Mills, however, pointed out that would not mean rates increasesof 252 percent or over 100 percent. At one point, Mills labeledGarner’s numbers as as “faulty” and “meaningless” because they didnot consider all city bond financing and revenue options or thepossibility of two current bond issues being paid off in the nextfew years.

“Those numbers are correct based on the information that wasprovided to us in the services and facilities plan and on past bondissues,” Garner said.

Garner’s numbers also predicted the possibility of an over12-mill property tax increase.

Through a series of questions about bond financing and usingequipment depreciation expenses to pay off bonds, Mills attemptedto show the possibility of lower increases than Garner predicted.Also, regarding Grubbs’ rate hike prediction, Garner said he hadgiven no back up on the information and she had no idea if it wasaccurate.

“I cannot say whether it’s correct or incorrect,” Garnersaid.

Following Thursday’s testimony, annexation consultant MichaelBridge was expected to be the city’s final rebuttal witness Friday.It was unclear Thursday whether attorneys would then have closingstatements or simply submit recaps of their positions for SpecialChancellor John Ross to consider in deciding the case.