Brookhaven officials are disputing an attorney general’s officefinding that the city airport was price gouging on airplane fuellast week in the wake of Hurricane Katrina.

Following a citizen’s complaint, attorney general’sinvestigators came to Brookhaven and deemed the city to be pricegouging, Mayor Bob Massengill said Tuesday night during a citybudget work session with aldermen.

“At the time we were accused of price gouging, we were 15 centsa gallon below Natchez and McComb,” the mayor said, citing thosecities’ $4 a gallon and Brookhaven’s $3.85 a gallon. “We do notfeel we were wrong in this.”

Massengill said City Attorney Joe Fernald had investigated thecity’s airport fuel policies and had prepared a response to send tothe attorney general’s office.

The mayor said the city’s policy was a 30 percent markup, with a5 percent discount for local pilots, plus increases whenever thecost of replacing the fuel rises. If the city did not do that, hesaid, it would lose money on the operation.

“We are satisfied we are not (price gouging), and we will go tocourt over it,” said Massengill, who was hopeful the court optionwould not happen.

To be safe, Massengill said, he said the city has lowered itsgasoline price and had refueled its tank.

“We’re selling it below what we’re paying for it,” Massengillsaid. “You can’t stay in business that way.”

Later in the meeting, aldermen approved a new fuel pricingpolicy calling for a 70-cent-per-gallon markup plus a15-cent-per-gallon discount for local pilots. The policy changetakes effect Oct. 1.

In related action, the board approved a $20-a-month increase inhangar-rental fees. Ward Six Alderman Buddy Allen said he thoughtthe increase was fair.

Aldermen also approved a policy to give priority on hangarrental to Brookhaven and Lincoln County residents. Fernald saidanyone not in compliance with that policy would have to be given 30days notice.

“That’s really the way it should be,” Alderman at large LesBumgarner said of giving priority to area residents.

The hangar-rental fee increase was among a variety of previouslydiscussed fee hikes approved Tuesday night.

Other fee increases getting board approval last night included a6 percent hike in water and sewage rates and a $4 a month increasein solid waste fee. Officials said the water and sewer increasewould amount to less than $1 a month for most customers, while thesolid waste fee would go from $12 a month to $16 a month.

In budget matters, Massengill warned aldermen to be prepared inthe future to discuss new generators for water departmentoperations. He indicated the need for new equipment became obviousfollowing the hurricane.

“Had it not been for the dedication of our city employees, wewould have had problems,” said Massengill, citing their ability to”nurse” the generators through the crisis.

With an overall budget has not been determined, aldermen lastnight approved the property tax levy rates for the new year.

For city residents, the tax levy will increase half a mill from92.17 mills to 92.67. The increase means they will be paying about50 cents more for every $1,000 of assessed property value.

City Clerk Mike Jinks said the millage rate for general fundoperations will remain the same at 23.08 mills. The tax levy forschool district operations is slated to drop slightly from 51.77mills to 51.33 mills.

Officials cited a new 1.48 mill levy to service a bond issue forthe community’s new business park as the main reason for the taxlevy increase. Tax levies for other current bond options dropped,resulting in the net increase.

“We are not raising our millage for anything other than debtservice,” Massengill said.