- Associated Press - Wednesday, September 9, 2015

TOPEKA, Kan. (AP) - Junction City is seeking bids on 25 of the more than 900 lots it was forced to take back after a promised surge of troops at Fort Riley never materialized.

The lots, which have utilities and streets leading to them, are the legacy of an announcement in 2005 that as many as 8,000 troops would be transferred to Fort Riley. The city responded to that projection by annexing about 1,400 acres to build new housing and taking on $190 million in debt to finance the infrastructure and for incentives for developers, The Topeka Capital-Journal reported (https://bit.ly/1LXFibu ). About 5,500 troops arrived by early 2008 but most either couldn’t afford the new housing or preferred to stay on base.

Planning and Zoning Director David Yearout said sealed bids on the lots are due by 5 p.m. Thursday. The city will decide whether to accept the bids, which must be for at least $5,000, on Tuesday.

If all goes well, more properties will go on sale in the future, as the city clears titles to the land, said City Manager Allan Dinckel.

“We did the first 25 just to test the market,” he said. “I think you have to be careful not to flood the market.”

The city’s current leaders, none of whom were serving before 2008, say the city commission at the time got caught up in the expansion “fervor” and committed more funds than it should have.

“There was no phase, no plan, unfortunately,” Junction City Commissioner Pat Landes said. “We got stuck with the check.”

The overbuilding, combined with the recession, caused some developers to declare bankruptcy. Topeka businessman John Duncan pleaded guilty to fraudulent dealings involving the land, and former Junction City Mayor Michael Wunder was sentenced to prison for taking bribes from Lawrence developer David Freeman, who also served time for conspiracy to commit bank fraud.

When the lots went unsold at a public tax sale, the city took them into a land bank. The public is still paying the first seven of the 20 years of special assessments used to finance the infrastructure development, Landes said.

A state tax change approved this year by the Legislature will make it easier to sell the lots because it allows the city to restart the clock for 20 years’ worth of special assessments on each property, Dinckel said, meaning a buyer wouldn’t have to pay seven years of assessments up front, but could pay yearly for the next 20 years. The assessments range from $70 to $200 per month for most properties, he said.

The properties are eligible for a “neighborhood revitalization plan” tax abatement on any homes built, and residents don’t have to pay back property taxes, Landes said. The abatement will reduce property taxes on the structure by 95 percent for the first two years; 75 percent for the third year; 50 percent for the fourth year; and 25 percent for the fifth year.

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