Kathy Vesom Internship Report Final Copy

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Kathy Vesom

Kansas State University

Analysis of Neighborhood Revitalization Plan in Junction

City, KS

Internship Paper

May 9, 2008

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Table of Contents

1. Introduction 3-4

2. Background 4

3. Literature Review 4-8

4. Methodology 8 - 14

5. Results 14 - 16

6. Conclusions & Recommendations 16 - 18

7. Bibliography 19 - 25

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Introduction

In any given major city or small town, there are

areas that have deteriorated both physically in appearance

and economically. This economic deterioration in

conjunction with deterioration of overall physical

appearance in these neighborhoods may have been caused by a

number of factors, e.g. lack of jobs, high crime or people

simply moving away to new neighborhoods. Neighborhood

revitalization is one solution that many cities have used

to improve the economic and physical appearance of these

neighborhoods. A program evaluator found that the

Neighborhood Revitalization Program in Minneapolis made a

significant difference in increasing the number of repairs

and improvements in the Minneapolis housing stock.1 This

internship paper will briefly evaluate Junction City's

Neighborhood Revitalization Plan (NRP) by looking at

population, crime statistics, job growth, sales tax

revenue, property valuations and unemployment rates between

1992 and 2006.

To understand NRP, the background of NRP and problems

in analyzing this program will be discussed in this paper.

In addition, the property valuations before and after

program implementation of revitalized areas will be

discussed. State laws will be discussed as part of the

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discussion on the background of NRP. It is hypothesized

that if the program is successful, there will be an

increase in population, a reduction in crime, an increase

in job growth, an increase in sales tax revenue, increase

in property valuations and a decrease in unemployment rates

in Junction City.

Background

The Neighborhood Revitalization Act (NRA) was passed

by the Kansas Legislature in 1994.2 It provides for

property owners to receive tax rebates for making

renovations and improvements to their property.3 There has

been little opposition to this state law.4,5 Prior to the

passing of this legislation, Mike Hall notes quot;there seemed

to be no real opposition to it, but not a lot of enthusiasm

at first, either.quot;6 The Attorney General of Kansas and the

Assistant Attorney General felt that the tax rebate should

be payable to the owner of the property who is liable to

pay the taxes.7

Literature Review

A recent literature search of evaluating neighborhood

revitalization programs has resulted in limited success.

There have been in depth studies utilizing complex

techniques such as econometrics in evaluation.8 However, a

study has been done on the Minneapolis Neighborhood

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Revitalization Program.9 The study found that “in addition

to making a significant difference in increasing the number

of repairs and improvements in the Minneapolis housing

stock, the NRP made a significant difference in increasing

homeownership rates in Minneapolis neighborhoods.”10 Elena

Fagotto and Archon Fung state:

“Under this program, neighborhood associations develop
„action plans‟ that articulate residents‟ needs and
also strategies and projects to meet those needs.
These associations work with city agencies, private
contractors and other organizations to implement those
strategies and projects to meet those needs.”11

They state “the NRP was conceived as a program to join

residents and city agencies in the business of neighborhood

improvement.”12 They analyzed the Minneapolis Neighborhood

Revitalization Program on the basis of secondary

literature, program evaluations, data relative to

neighborhood characteristics, allocations and expenditures

made available by NRP and individual and group interviews.13

They state quot;even though many organizations predate NRP, the

program resuscitated many neighborhood organizations, and

stabilized and contributed to the growth of many others.quot;14

They state quot;property values have risen in Minneapolis, and

this may be in part due to NRP activities.quot;15 They

criticize NRP in that the program quot;did not transform city

agencies.quot;16

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They continue quot;city agencies have not undergone

complementary reforms to reorganize themselves in ways to

accommodate neighborhood input in their planning and

decision-making.quot;17 They have observed that “inter-agency

collaboration did occur for a number of projects…but

departments did not adopt more integrated approaches to

work with neighborhoods.”18 Finally, they state “Since

NRP’s success depends in large measure upon cooperation

with and among city agencies, a clearer system of

incentives and governance rules would have improved the

program’s efficacy.”19

To remedy these problems, they suggest that

“incentives could have been designed for city agencies,

such as large pools of dedicated funding to spend

exclusively on NRP projects.”20 In addition, they believed

that “the governance structure defining the interaction

between the city and the neighborhoods should have been

spelled out more clearly, assigning agencies precise roles

and responsibilities vis-à-vis neighborhoods.”21

One author has some thoughts on guidelines on

neighborhood revitalization.22 Roger Ahlbrandt, Jr. states

the following:

“Public policy for neighborhood renewal should be
formulated on several levels. Cities must be
concerned with the overall loss in population and

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jobs. Therefore citywide economic development should
be a primary focus of public policy.”23

Many cities throughout the U.S. have utilized

neighborhood revitalization. Ahlbrandt, Jr. notes the

following:

“Pittsburgh has integrated housing, economic
development, and city service and infrastructure
improvements as circumstances have warranted. This
strategy is based on a recognition that a
comprehensive, targeted approach to neighborhood
revitalization is necessary in order to stem decline
and to raise the level of confidence in the
neighborhood's future on the part of home owners,
investors, and others who affect its quality of life
and the strength of its economic base.”24

While Pittsburgh may have a unique approach to

neighborhood revitalization,25 Louisville, Kentucky, has

also a unique program.26 The city utilizes Housing and

Neighborhood Development Strategies (HANDS), an innovative

neighborhood revitalization program which was created in

1993 under a three-year, $1.5 million grant from the U.S.

Department of Education and operated by the University of

Louisville.27 Roger Hamlin and Thomas Lyons state that

quot;the focus of HANDS's efforts is the low-income, inner city

neighborhood on the city's west side known as Russell.quot;28

There are numerous and a wide range of collaborators

within HANDS, such as the City of Louisville, Habitat for

Humanity as well as local churches.29 Hamlin and Lyons

state that quot;HANDS offers job training, entrepreneurship

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assistance, education, leadership training, case

management, home ownership, and community design.quot;30

Methodology

In contrast to community based neighborhood

revitalization programs in Minneapolis and Louisville, the

neighborhood revitalization program in Junction City is

mostly focused on individual properties. On October 21,

1996, the Neighborhood Revitalization Plan (NRP) was

adopted by the City of Junction City and has since

undergone 13 revisions.31 The Original Plan of NRP

established the purpose, rules and physical boundaries of

NRP areas.32 Subsequent revisions further expanded these

areas and rules.33 The latest revision was on Feb. 6,

2006.34 NRP is intended to promote the revitalization and

development of the City of Junction City by stimulating new

construction, and the rehabilitation, conservation, or

redevelopment of specified areas in order to protect the

public health, safety or welfare of the residents of the

city by offering certain incentives which include property

tax rebates.35

In the 13th NRP revision, then mayor Jack Taylor

states the following:

“…the Neighborhood Revitalization Areas designated by
the City Commissioners have dilapidated, deteriorated
and deteriorating structures, buildings and

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improvements that are in need of conservation or
preservation due to age, history and
architecture…there are a substantial number of
deteriorated structures and other conditions that
substantially impair the sound growth of Geary
County.”36

There is a three year application period for NRP.37

The Junction City-Geary County (JCGC) Economic Development


“At the end of the three years, the taxing entities
will review the plan and determine its continuation.
Those approved during the three year period shall
continue to receive the tax rebate for up to the full
ten years allowed, dependent on conditions granted by
the city commission.”38

Under the 13th NRP revision, tax rebates are

transferable with ownership of the property.39 Rebates are

revoked if any property is delinquent in any tax payment

and/or special assessment.40 Only improvements to existing

buildings and/or construction of new buildings can receive

tax rebates.41

Property taxes account for 22% of Junction City's

revenues.42 In order to calculate property taxes, mill

levies must be determined and are used to calculate

assessed property valuation.43 A mill levy is the number of

dollars a taxpayer must pay for every $1000 of assessed

value.44 Property appraisals are a part of the valuation.45

County appraisers submit property appraisals to the county

clerk.46 Based on the budgets presented by governmental

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agencies in Geary County, the mill levy for the county is

prepared by county clerk.47 The City of Junction City


quot;The County Clerk calculates the mill levy by dividing
the dollars needed for city services by the assessed
property value within the city limits. This is
repeated for each taxing unit-schools, county and
city.quot;48

In essence, the budget determines the mill levy.49

Junction City City Commissioners must approve of any change

in mill levy.50 As property valuations increase, the value

of the mill levy increases as well.51 The mill levy

multiplied by the assessed value of properties make up the

taxes for all properties each year.52

The influx of soldiers presents with a problem with

analyzing this program. This influx might lead to a great

demand for housing, which might lead to an increase in

property tax revenues due to new construction for the

surrounding areas of Fort Riley and an increase in economic

development. Therefore, these effects make it difficult to

assess whether NRP is successful. Soldiers from various

U.S. military bases from around the world and country will

be reallocated to Fort Bliss, Texas and Fort Riley due to

base closings.53 In California, the increase in population

has caused an increase in demand for housing, thereby

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causing higher property values which in turn resulted in

higher taxes.54

The increase in population might lead to an increase

for demand for services and housing and might lead to

increasing city sales tax and property tax revenues.

Whenever the troops are deployed, the population decreases.

When the troops arrive from other bases, the troops bring

their families thereby increasing the population. In

addition to affecting population, these fluctuations cause

an increase in property valuation, city sales tax revenue,

and job growth and a decrease in unemployment.

Since the literature review did not provide a

preliminary evaluation, the policy will be evaluated on the

basis of six variables (crime, civilian population, city

sales tax revenue, job growth, property valuation and

unemployment rates). Data from 1992 to 2006 in all

variables were used in this study to compare the data

before NRP was implemented (1992 – 1995) and data after NRP

implementation (1996 – 2006). In all variables, data used

in this analysis represents only Junction City. Data for

total population between the years 1992 to 2006 were used

in this analysis since civilian population was reported

only in the 2000 Decennial Census.55,56 Total population

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data were obtained from the Comprehensive Annual Financial

Reports.57

Data from 1992 – 2005 were provided by Bill Reid,

Research Analyst II of the Kansas Bureau of

Investigations.58 Data from 2006 were obtained from the

Kansas Bureau of Investigations website.59 All collected

data from both sources were used to analyze crime in

Junction City. The data that were provided by Reid were

not complete.60 Data from the years: 1993, 1994, 1995, and

1999 were not available.61 Crime index offenses are the

total number of crimes, which includes violent crimes and

property crimes.62,63

Crime index offenses are heavily dependent on

population. Population in Junction City fluctuated

possibly due to the number of soldiers coming to Fort

Riley. Crime per capita per year was calculated using

population data that were reported in this analysis. Crime

per capita per year was calculated by dividing the number

of crime index offenses by the population. The crime index

offenses do not mean that the offenses were committed by

Junction City residents, but indicate that the crimes took

place in Junction City by any person from any area, e.g.

Manhattan, etc..64

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Unemployment data were obtained from Micah Ross,

Research Analyst for the Kansas Department of Labor.65

Ross obtained the original data from the Bureau of Labor

Statistics.66 Unemployment per capita was calculated using

population data that were reported in this analysis. Job

growth data were obtained from Rose Palmer, Economic

Development Specialist for the JCGC Economic Development

Commission.67 A total of 61 NRP applicants were included in

the job growth study.68 Job growth could not be reported in

percentages due to the limited data given by Ms. Palmer.69

Property valuation data were obtained from a

spreadsheet provided by the Geary County Appraiser, Jim

Ruhnke.70 People whose projects were not completed, one

applicant who applied six times and another applicant who

did not receive a rebate due to human error were not

included in the property valuation study. A total of 127

NRP applicants in Junction City, whose projects were

completed by 2006, were included in this study for the

property valuation. Sixty applicants out of 127 applicants

in the study had $0 in the “Improvement Basis.” The $0 in

the “Improvement Basis” indicates that there was no

building on the land and since NRP is only used for

building valuation and not for land valuation.71 The

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“Improvement Value” was used in this analysis since this

represents estimated appraised values utilizing NRP.72

Sales tax revenue data from 1992 – 2005 were obtained

from the City Manager, Rod Barnes.73 Data from 2006 were

obtained from Joleen Schnurr, City Treasurer.74 Sales tax

revenue per capita was calculated using population data

that was reported in this analysis. In all variables with

the exception of job growth, the averages were computed for

1992 – 1995 (before NRP) and 1996 – 2005 (after NRP) due to

fluctuations in data.

National economic conditions may have affected the

data. From March 1991 to March 2001, there was a period of

economic growth.75 A recession occurred from March 2001 to

November 2001.76 Although the 13th NRP revision and original

NRP plan did not specifically state any program goals,77,78

some program goals were proposed during the analysis of

this program and were discussed with the City Manager.

These goals include increased sales tax revenue, increased

job growth, decreased crime rate, decreased unemployment,

increased property valuation and increased population.

Results

Table 1 below best summarizes the total variable

analysis. This table demonstrates that unemployment per

capita decreased 2.71%, annual sales tax revenue increased

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19.3%, annual sales tax revenue per capita increased

44.77%, job growth increased 24.5%, total number of crimes

per year decreased 92.15%, total number of crimes per

capita per year decreased 91.02%, and property valuation

increased 89.62%. The average percent change for property

valuation was computed by first calculating the percent

change for each NRP applicant’s property and then taking

the average for all 127 NRP applicants.79 The individual

property percent change was computed by the following

calculation:80

Individual property percent change =

2006 Improvement Value – Improvement Basis x 100
(2006 Improvement Value + Improvement Basis)/2))

Before and After NRPa
Table 1:

Average Average Percent
Variables 1992 – 1995 Median 1996 – 2006 Change
Unemployment per capita 0.0391 0.0398 0.0380 -2.71%
Annual Sales Tax Revenue $1,949,826.67 $2,139,269.68 $2,326,058.22 19.30%
Annual Sales Tax Revenue
per capita $91.92 $121.77 $133.07 44.77%
253b 315c
Job Growth 284 24.50%
Total Number of Crimesd
per year 2049 1104.93 160.86 -92.15%
Total Number of Crimesd
per capita per year 0.1 0.092 0.009 -91.02%
$55,301.71e $297,689.01f
Property Valuation $80,590.00 89.62%

a
Different time frames may alter comparisons.

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b
Sixty-one NRP applicants had 253 jobs that existed prior to

NRP utilization.81
c
Sixty-one NRP applicants created an additional 315 jobs

after utilizing NRP.82
d
Data only available for 1992, for 1996 to 1998 and for 2000

to 2006.83
e
The amount indicated in the “Average 1992-1995” for

property valuation is only the average of all 127 NRP

properties appraised values prior to NRP (“Improvement

Basis)” and not the average of appraised values from 1992

to 1995. The “Improvement Basis” is the appraised value of

the building.84
f
The amount indicated in the “Average 1996-2006” for

property valuation is only the average of all 127 NRP

properties appraised values (“Improvement Value”) from 2002

to 2006.

Conclusions and Recommendations

In conclusion, I recommend that Junction City continue

this policy on the basis of data from Table 1. Data from

Table 1 clearly demonstrates that unemployment decreased,

sales tax revenue increased, crime has decreased and job

growth increased since the implementation of NRP. In

addition, property valuation has increased on the

properties undergoing revitalization. Therefore, the data

Vesom 17

have proved that NRP has been successful and beneficial to

Junction City.

Data from Table 1 demonstrates that property

improvement leads to job growth, an increase in sales tax

revenue and a decrease in unemployment. This data shows

that neighborhood revitalization can work on an individual

basis in a community such as Junction City, while the

literature review shows that neighborhood revitalization is

successful on a community level, meaning communities work

together to revitalize neighborhoods. It would be

interesting to see if NRP in Junction City with a

combination of both individual and community levels is

successful. More work is necessary to determine the long

term effects of NRP on Junction City.

A decrease in unemployment, increase in sales tax

revenue, increase in job growth and property valuation may

be due to an increase in demand for housing and services

due to the influx of soldiers from Fort Riley. Economic

growth that began in March 1991 and ended in March 200185

may have caused property valuations to increase, sales tax

revenue to increase, job growth to increase and

unemployment to decrease. A decrease in crime may be the

result of a greater number of police officers, tighter

crime legislation or a decrease in population. A decrease

Vesom 18

in population may have been the result of soldiers’

deployment.

In theory, property valuation should be the main

variable in determining the success of NRP. The main focus

of NRP is revitalizing neighborhoods by residential and

commercial improvements.86 As these improvements are made,

crime rates decrease, sales tax revenue increases,

population increases, unemployment decreases and job growth

increases. In theory, revitalized areas have lower crime

rates, higher property values, higher population, lower

unemployment, greater sales tax revenue and higher job

growth. To what extent and how long these effects will

last are unknown.

Vesom 19

Bibliography

1. Minneapolis NRP. (n.d.). Minneapolis Neighborhood

Revitalization Program Fact Sheet. Retrieved March 25,

2007, from

http://www.nrp.org/R2/AboutNRP/Basics/NRPFactSheet.pdf

2. The Kansas Neighborhood Revitalization Act. 1 Session

Laws of Kans. §§ 242-1-18 (1994), p. 997.

3. Ibid., pp. 997-999.

4. Hall, M. (2000, July 9). Target Area Splits

Backers. The Topeka Capital-Journal Online.

Retrieved April 11, 2008, from

http://www.cjonline.com/stories/071000/com_backers.sht

ml.

5. Stovall, C. J. and Feighny, M. (1996, Nov. 14).

Attorney General Opinion No. 96-84. Retrieved March

25, 2007, from

http://www.kscourts.org/ksag/opinions/1996/1996-

084.htm.

6. Hall, op. cit..

7. Stovall, C. J. and Feighny, M., op. cit..

8. Center for Urban Policy Research. (n.d.). Program

Evaluation. Retrieved Aug. 5, 2007, from

http://www.policy.rutgers.edu/cupr/research/progeval.h

tm.

Vesom 20

9. Minneapolis NRP, op. cit..

10. Ibid.

11. Fagotto, E. and Fung. A. (2005, Feb. 15). The

Minneapolis Neighborhood Revitalization Program: An

Experiment in Empowered Participatory Governance.

Retrieved Aug. 6, 2007, from

http://www.ids.ac.uk/logolink/resources/downloads/Reci

te_Confpapers/NRPFinal.pdf, p. 56.

12. Ibid., p. 56.

13. Ibid., p. 4.

14. Ibid., p. 57.

15. Ibid., p. 56.

16. Ibid., p. 57.

17. Ibid., p. 57.

18. Ibid., p. 57.

19. Ibid., p. 57.

20. Ibid., p. 57.

21. Ibid., p. 58.

22. Ahlbrandt, Jr., R. S. (1986). Public-Private

Partnerships for Neighborhood Renewal. Annals of the

American Academy of Political and Social Science, 488,

120-134.

23. Ibid., p. 123.

24. Ibid., p. 131.

Vesom 21

25. Ibid., p. 131.

26. Hamlin, R. E. and Lyons, T. S. (1996). Economy

Without Walls: Managing Local Development in a

Restructuring World. Westport, CT: Praeger

Publishers, pp. 77-78 and pp. 82-85.

27. Ibid., p. 77.

28. Ibid., p. 78.

29. Ibid., pp. 82-84.

30. Ibid., p. 85.

31. JCGC Economic Development. (2006). Neighborhood

13th Revision, p. 2.
Revitalization Plan.

32. Palmer, R. (personal communication, 2006).

33. Ibid.

34. JCGC Economic Development., op. cit., p. 2.

35. Ibid., p. 5.

36. Ibid., p. 4.

37. Ibid., p. 6.

38. Ibid., p. 6.

39. Ibid., p. 7.

40. Ibid., p. 7.

41. Ruhnke, J. W. (personal communication, 2006).

42. City of Junction City. (2006, October 17). Junction

City Fact Sheet.

43. Geary County. (n.d.). A Homeowner’s Guide to

Vesom 22

Property Taxes. Retrieved April 29, 2008, from

http://www.geary.kansasgov.com/MV2Base.asp?VarCN=217.

44. Sweetwater County Treasurer's Office. (n.d.). What is

a Mill Levy?. Retrieved March 29, 2007, from

http://www.co.sweet.wy.us/treas/propertytaxes/page4.ht

ml.

45. Geary County Appraiser's Department. (n.d.). Geary

County Website. Retrieved March 29, 2007, from

http://www.geary.kansasgov.com/MV2Base.asp?VarCN=192.

46. Ruhnke, J. W., op. cit..

47. Geary County Appraiser's Department., op. cit..

48. City of Junction City, op. cit..

49. Gould, C. (personal communication, 2008).

50. Gowen, T. L. (personal communication, 2008).

51. Gould, C., op. cit..

52. Geary County Appraiser’s Department., Geary County

Website, op. cit..

53. Gilmore, G. J. (2006, June 21). Troop Moves, BRAC

Part of DoD's Transformation Agenda, Officials Say.

Retrieved March 25, 2007, from

http://www.defenselink.mil/news/newsarticle.aspx?id=15

985.

Vesom 23

54. Wikipedia. (2007, Mar. 12). California

Proposition 13 (1978). Retrieved March 25, 2007, from

http://en.wikipedia.org/wiki/California_

Proposition_13.

55. U.S. Census Bureau. (n.d.). Junction City city,

Kansas – DP-2 Profile of Special Characteristics:

2000. Retrieved August 19, 2008, from

http://factfinder.census.gov/servlet/QTTable?_bm=y&-

geo_id=16000US2035750&-qr_name=DEC_2000_SF3_U_DP2&-

ds_name=DEC_2000_SF3_U&-_lang=en&-_sse=on.

56. U.S. Census Bureau. (n.d.). Junction City city,

Kansas – DP-2 Profile of Special Characteristics:

1990. Retrieved September 5, 2008, from

http://factfinder.census.gov/servlet/QTTable?_bm=y&-

context=qt&-qr_name=DEC_1990_STF3_DP2&-

ds_name=DEC_1990_STF3_&-CONTEXT=qt&-tree_id=101&-

all_geo_types=N&-geo_id=16000US201415&-

search_results=16000US201415&-format=&-_lang=en.

57. City of Junction City, Kansas. (n.d.). Demographic

Statistics Last Ten Years. Comprehensive Annual

Financial Report for the Fiscal Year Ended December

31, 1992, p. 92; Comprehensive Annual Financial Report

for the Fiscal Year Ended December 31, 1996, p. 101;

Comprehensive Annual Financial Report for the Fiscal

Vesom 24

Year Ended December 31, 2004, p. 83; Comprehensive

Annual Financial Report for the Fiscal Year Ended

December 31, 2005, p. 80; Comprehensive Annual

Financial Report for the Fiscal Year Ended December

31, 2006, p. 74.

58. Reid, B. (personal communication, 2006).

59. Kansas Bureau of Investigations. (2007, Apr. 30).

2006 Crime Index. Retrieved August 19, 2008, from

http://www.accesskansas.org/kbi/PDF/Crime%20Index%2020

06.pdf, p. 6.

60. Reid, B., op. cit..

61. Ibid.

62. Ibid.

63. Story, Chief B. (personal communication, 2006).

64. Ibid.

65. Ross, M. (personal communication, 2008).

66. Bureau of Labor Statistics. (n.d.). Bureau of Labor

Statistics Data. Retrieved August 19, 2008, from

http://data.bls.gov/PDQ/servlet/SurveyOutputServlet.

67. Palmer, R., op. cit..

68. Ibid.

69. Ibid.


71. Ibid.

Vesom 25

72. Ibid.

73. Barnes, R. D. (personal communication, 2006).

74. Schnurr, J. (personal communication, 2008).

75. National Bureau of Economic Research. (2001, Nov.

26). The Business-Cycle Peak of March 2001.

Retrieved July 16, 2008, from

http://www.nber.com/cycles/november2001/.

76. National Bureau of Economic Research. (2003, July

17). Retrieved July 24, 2008, from

http://www.nber.org/cycles/july2003.pdf, p. 1.


Revitalization Plan. Original Plan, pp. 2-19.


13th Revision, pp. 2-49.
Revitalization Plan.

79. Turner, T. M. (personal communication, 2008).

80. Ibid.

81. Palmer, R., op. cit..

82. Ibid.

83. Reid, B., op. cit..


85. National Bureau of Economic Research. (2001, Nov.

26). The Business-Cycle Peak of March 2001., op.

cit..

86. JCGC Economic Development., op. cit., pp. 5-7.

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