By Lior Datel and Erez Sherwinter, Haaretz Real Estate supplicant

The residential housing market is flourishing, with apartment prices up by over 50% compared to 2004. The Tamar Science Park has put the city on the high-tech map. The population has a higher than national average proportion of university graduates and is proud of being known as Israel's "science city." Even with all these, however, Rehovot ranks only 9th among Israel's 15 biggest cities for quality of life, according to a survey by TheMarker and Ha'ir.

Rehovot's cumulative deficit is high and a substantial chunk of the municipal treasury's expenditures are earmarked for returning loans and paying employee salaries and pensions. The remaining funds are insufficient for underwriting infrastructure development plans, rehabilitation of neighborhoods and absorption of the thousands of immigrants who have chosen Rehovot as their new home.

The biggest surprise in the survey was the remarkable state of its residential housing market. In this realm, the city is in second place among the cities surveyed. In the past few years Rehovot's immigration balance has been positive, with 0.21% of the net increase in population coming from immigrants, in 2004-2006. The statistics show just how much the construction industry is flourishing: During 2004-2006 over 238,000 square meters of residential housing was built - an average of 0.73 square meters per resident, compared to an average of 0.63 square meters for the other 14 cities surveyed. Furthermore, housing prices in Rehovot have risen by 54.6% in the past two years, while rental prices have soared by 66.7% (according to data provided by Levy Yitzhak). Nevertheless, apartments are still affordable there. A person earning an average salary would have to work 7.8 years to buy a 100-square-meter apartment in Rehovot, compared to 9.5 years on average in the other cities surveyed.
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In the 1970s Rehovot missed one of the biggest opportunities that ever came its way: The first high-tech complex in the region - Kiryat Weizmann - was built in Nes Tziona, Rehovot's smaller neighbor. After a considerable wait, Rehovot began building its own Tamar Science Park eight years ago. This successful high-tech enterprise covers 1,000 dunams (250 acres) at the city's northern entrance, and has become an employment and social center for Rehovot and its environs. There are 15 high-tech and biotechnology companies there (including Applied Materials, Elop Electro Optics Industries and Sapiens Technologies), along with two of Israel's leading academic institutions: the Weizmann Institute of Science and Hebrew University's Faculty of Agriculture.

Like every other high-tech area, Tamar Park began to sprout coffee shops, restaurants, stores and pubs that are frequented by employees and young people from the surrounding area. In the past five years, and mainly since the train station opened there, 20 pubs, a dozen cafes and about 15 restaurants have opened in the vicinity. Even so, this city still does not have a performing arts center due to budgetary difficulties, which have also delayed the construction of a municipal soccer stadium.

The city's coffers are far from overflowing. Rehovot ranked 14th out of the 15 cities surveyed in terms of its municipal financial management. Even though the current budget deficit for 2006 was less than in previous years - NIS 1.5 million, compared to NIS 33 million in 2004 - most of the cities surveyed did not have any deficit that year.

Over the years prior to 2006, Rehovot accumulated a deficit of NIS 123 million. This means that the city is in debt to the tune of NIS 1,000 per resident, compared to an average of NIS 178 per resident in the other cities surveyed.

About 8.8% of the city's expenditures are for loan repayments, and about 20% is spent on non-contributory pension payments and administrative employee salaries. One statistic in Rehovot's favor is its high level of municipal tax collection: 97%, compared to an average of 89% in the other cities. Like other locales, Rehovot generates 74.5% of its revenues independently, from municipal and other taxes, and is not dependent on government grants per se.

Plans, initiatives and even a government commission have not managed to solve the distress of Rehovot's Kiryat Moshe neighborhood, which was populated the year Israel was established, mainly with immigrants from North Africa, and became the main center for Ethiopian immigrants in the 1990s. Today those immigrants make up over half the neighborhood's residents. The lack of resources and the abundance of large families have had a negative effect: In recent years there were three cases of teen murders involving minors who grew up in the neighborhood.

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