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Be'er Sheva doesn't seem to be in great shape. A comparison of 12 cities by TheMarker and Ha'ir placed the capital of the Negev in 10th place.

Investment in development is minimal; the municipality's outlay for every resident is low; the air is foul; the deficit is big; unemployment is high; and the balance of influx and migration is the worst of all the cities on the index.

Yet cautious optimism is due. Work on the Negev town that is to house new training bases of the Israel Defense Forces (known as "Ir Habahadim") is injecting new life into Be'er Sheva. The real-estate market seems to be rallying, much commercial space is being built and the cultural situation has improved.

Be'er Sheva's commercial affairs have been improving. Neighborhood shops have been overtaken by huge malls. Not everyone thinks that the plethora of commercial compounds will bring prosperity: some think that the buying power of Be'er Sheva's consumers is limited and can't keep apace with the centers being set up. (Which means, some will go broke.) Also, the neighboring town Netivot is starting to pose competition for Be'er Sheva in terms of commerce and culture.

Thirty years ago, when Eliahu Nawi was mayor, the local theater and the Sinfonietta orchestra were established and since have been virtually the only two cultural institutions in the city. Recently there has been a serious push to expand the city's cultural life. A drama school was set up three years ago as part of the youth center established six years ago to nuture local talent.

Be'er Sheva this month inaugurated a performing arts center that is considered one of the plushest in the country. There is also talk of founding a museum for children.

Be'er Sheva is also home to the Soroka Medical Center, the only hospital in the Negev, which has been expanding with the help of private donors. It opened a children's hospital this month and next year will see new delivery rooms.

Also, Ir Habahadim is finally getting underway following various legal struggles and petitions. It will be located south of Ramat Hovav. The legal battles focused on concerns about pollution from the toxic waste dump there. Green organizations were furious that no environmental survey had been carried out before the decision was taken to set up the site, and the High Court of Justice ruled the state must conduct a survey within a year and then act according to its findings. Yet clearly Ir Habahadim is the great hope of the Negev and of Be'er Sheva. New residents with earning power will move to the Negev, and the workplaces that will be created will inject significant energy into the area's economy.

Students are the city's greatest missed opportunity. The Ben-Gurion University of the Negev attracts thousands of kids from all over the country, which represent tremendous economic potential. Thanks to them, places of entertainment are flourishing and landlords are making a tidy sum. Be'er Sheva, however, hasn't found a way to keep the kids in town once their studies are done. Most graduates take the first train back to the center of the country. One proposal is setting up a high-tech park as a joint venture of the municipality and the university. But it is not only students who leave the city.

From 2004 to 2006, more people left than came to the city. Be'er Sheva is the town with the greatest negative balance of migration of all the towns examined in the survey. The situation is even more worrisome because the reason why people want to leave is not the distance from the center of the country. Most of those who leave move to the nearby upscale communities of Omer, Lehavim and Meitar, and even to the town of Netivot. The municipality's financial situation is not good. True, Be'er Sheva succeeded in sizing down its heavy debt; 2006 ended with a relatively small deficit of NIS 5.8 million, but the cumulative deficit stood at NIS 206 million at the end of that year.

City officials are proud to say that, according to the financial reports of for 2007, the cumulative deficit was knocked down to NIS 120 million - and Be'er Sheva achieved budgetary balance. But its outlay per resident is lower than in other cities. From 2004 to 2006, the city spent annually some NIS 4,390 per resident, while the average in other cities surveyed was NIS 4,761. And the city ranked higher than others in terms of its spending. Some 18.5% of the city's expenditures are earmarked for municipal salaries and pensions while the survey average was 23.8%.

Yet in education Be'er Sheva was last in the index of 12. The pupils in Be'er Sheva have a hard time trying to achieve results similar to those in other cities and towns, and on average only 53% of them were able to earn a matriculation (bagrut) certificate in the years 2003 to 2006; the figure was 60.5% in the other towns examined. Perhaps this reflects the sums the municipality spends for education, a mere 27% of the education budget after the payments from the Education Ministry and the parents, while the other towns examined averaged supplying 35.9% of their education budgets. Nevertheless, the dropout rate in Be'er Sheva schools is lower than the average for the towns examined , 2.2% as compared with 2.7%.

Salaries in Be'er Sheva are low. From 2003 to 2005, the average per capita wage was NIS 5,533 per month, some NIS 1,100 less than the figure for other towns surveyed.

The veteran neighborhoods of Be'er Sheva - Aleph, Gimmel and Daled - are extremely neglected. It is hard to find a clean spot in them; benches are broken and children's parks are filled with hazards. Recent months have seen tens of thousands of shekels spent on improving the situation in the old neighborhoods with new benches and sculpture. Some residents tie this to the upcoming municipal elections. Be'er Sheva spent NIS 499.50 per resident for development in the years 2004 to 2006, as compared with NIS 601 per resident on average in the other towns examined. But during those years, the municipality invested more in developing the water and sewage infrastructure, as well as the roads, more than all the other towns examined. The number of buildings constructed not for housing purposes was on a par with the average in the other towns - 0.17 meters per resident.

In the 15 years that were examined, property prices went up by double-digit percentages in most of the country. Only in Haifa, Hadera and Be'er Sheva was the trend negative. According to the price list put out by Levy Yitzhak, during the years 2006 to 2008, home prices in Be'er Sheva fell 10% (while rising 42% in the other towns examined) and the average price for an apartment with an area of 100 square meters in the city was the lowest of all the towns examined, NIS 360,000 as compared with NIS 927,000 on average in the other towns and cities.

Demand for housing in Be'er Sheva is low. During the past two years, there was less residential construction as compared with the other towns (0.48 meters per resident in Be'er Sheva next to 0.60 meters on average).

Even though the city was placed at the bottom of the rung with regard to housing, there is room for cautious optimism. The city's real-estate market has awoken from its slumber and recent months saw price rises by 10% to 12%, no doubt because construction work started at Ir Habahadim, which is expected to bring to the Negev tens of thousands of soldiers, standing army professionals and the regular ranks. One of the signs of change is the renewal of construction work in the city. It is possible also that the high-tech area of Omer is attracting residents to the city who cannot afford the upscale housing in Omer. In addition, thanks to the large number of students, the prices of apartments for rent went up by 53% in the years 2006 to 2008 (as compared with 61.5% with the other towns examined) and the return on a rented apartment per annum during these years was 5.4%, higher than in most other towns (4.8% on average). With regard to the environment, Be'er Sheva lags behind somewhat. According to the last report of the Environmental Protection Ministry, since 2005, the rate of recycling in Be'er Sheva was 14%, close to the average in the other towns of 12.9%. In addition, there were no deviations in the quality of the city's drinking water. However, the ministry's stations for monitoring air pollution reported that Be'er Sheva has a high rate of pollution from fine inhalable particles. Moreover, the city lives with a fear of air pollution from nearby Ramat Hovav. That picture will become clearer after the state carries out the court-ordered environmental survey.

Another environmental problem is the lack of green space. Adam, Teva V'din, the Israel Union for Environmental Defense, says that despite the plan to expand the Nahal Be'er Sheva park significantly, the city's so-called green spaces have not been developed and most of them are not kept up as they should be. The municipal Web site is short on detail about the quality of the city's water and air.