Junction City, Kan., is used to fluctuations in the population at neighboring Fort Riley associated with deployments and drawdowns from overseas conflicts, but the recline decline of 2,100 military and civilian personnel assigned to the post is hurting local business and putting a crimp in the real estate market.
The economic impact generated by the post fell from $1.9 billion in 2011 to $1.6 billion last year over an eight-county region.
Randy Tholstrup, who has owned an off-post Army surplus store for 18 years, said sales this year have dropped more than 20 percent, but he believed it stemmed from local unease over the presidential election rather than the decline in the number of soldiers at Fort Riley.
“I’d be crazy if I weren’t concerned by [the cutbacks]. It’s down, down, down every year,” Tholstrup told the Kansas City Star.
The prospect of a long-term decline in the Army’s end strength could exacerbate Junction City’s overbuilt housing market. To accommodate an expected influx of 8,000 troops a decade ago, the city annexed 1,400 acres and assumed $190 million in debt to jump start the construction of 1,500 homes. The surge didn’t occur as planned and following the housing market crash, the city was stuck with hundreds of empty lots.
It’s not clear when the open lots and finished homes will be absorbed by the market, according to the story.
The Flint Hills Regional Council is coordinating an assessment of the impact of the recent cutback of 615 personnel from the post that will be used to prepare for the potential of further cuts in the future.
“What might be the ripple effects on housing, education, health care … on tax revenues?” asked Jennifer Jordan, the council’s planning manager. The study is being carried out by Matrix Design Group and funded by a $294,000 grant from DOD’s Office of Economic Adjustment.
One recent bright spot in Junction City was the arrival of a call center in 2014, which hired 400 workers, including many who had recently separated from the Army. Employment at the center is expected to surpass 800 by next year.