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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.

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.

In 2005 then prime minister Ariel Sharon's government set up an interministerial directors general commission, initiated by Rehovot Mayor Shuki Forer, in an attempt to solve some of Kiryat Moshe's problems and to serve as a national model for addressing immigration absorption challenges. The commission spent a year drafting its recommendations, but in early 2008, before even a shekel had been spent implementing them, the government announced cancellation of the project.

Many of the problems thus remain without solutions, mainly due to a lack of funding. Sources in Rehovot explain that the deep municipal deficit is due partly to the difficulties facing the immigrant neighborhoods - because the absorption of so many new immigrants, particularly from the former Soviet Union and Ethiopia, has drained municipal coffers while insufficient funding was provided by the government.

In its transparency review by Shvil, the Israeli branch of civil society watchdog Transparency International, Rehovot came in last in providing residents with certain forms of information. For instance, Shvil was unsuccessful in obtaining certain important reports regarding possible conflicts of interest of city council members, the agendas of council meetings, details concerning the municipality's spokesman, or even the identity of the person responsible for implementing the freedom of information law.

Perhaps due to the city's meager financial resources, Rehovot has neglected its infrastructure - the development and rehabilitation of roads, water and sewer systems, and nonresidential construction. In 2004-2006 City Hall invested NIS 343 per resident per year in development, compared to an average of NIS 600 among the other cities surveyed, and the number of development projects started was the lowest of all locales. Still, despite the low investment in development, the ratio of car accidents involving injuries in the streets of Rehovot in 2004-2006 was low (an average of 1.6 accidents per 1,000 residents per year, compared to an average of 2.6 per 1,000 residents in all the cities). Sources at Rehovot's municipality note that according to the report for the last quarter of 2007, which has not yet been audited, the city invested some NIS 700 per resident in development in 2007.

The people who have suffered most from the meager investment in infrastructure have mainly been the residents of the poor areas. They have been complaining for years about crumbling roads, full of potholes, and this issue has sparked tension between the people and Mayor Forer.

In honor of the 100th anniversary of the arrival of a large group of immigrants from Yemen, who founded the city's Sha'arayim district, Rehovot is investing NIS 250,000 in celebrations that will include walking tours and cultural events. The local residents can take comfort in the partial renovation of that area. The construction of a new synagogue is also due to be completed soon, and the preservation of historical buildings will be starting next month on Menashe Kafra Street, which was built 100 years ago and never ever renovated.

Rehovot is very proud of the educated population that is drawn to the city's research and higher education institutions, and reports that over 30% of the residents have attended university. The socioeconomic level of residents is relatively high (7 on a scale of 10). The inequality index in this city is high compared to the countrywide average (0.45 compared 0.38), but is not all that different. The status of education in the "science city" is mediocre, however, and in most parameters is quite similar to that in the other cities surveyed: The city's main weak point here lies in the eligibility for matriculation certificates among Rehovot's youth: In 2004-2006 the average was 59.5%, compared to an average of 60.5% for all the cities. During those years, however, the average declined 3.9% locally - the sharpest decline of all the cities surveyed.

The quality of the environment in Rehovot could use some improvement. The Environment Protection Ministry's air-quality report for 2006 found high concentrations of certain unhealthy particles. The Israel Union for Environmental Defense says that since Rehovot is not a heavy-industry city, the pollution probably stems from natural conditions, motor vehicles and the cultivation of the soil near the city.

The most recent report from the Environment Ministry, from 2005, notes that Rehovot recycles 8% of its garbage, while the law requires it to recycle 25%. Still, the quality of the city's drinking water is very high - at least according to the Health Ministry's report of 2007. Rehovot's water inspectors conducted 98% of the tests they were supposed to do, and found no irregularities, even in repeat tests. There is also a reasonable level of information concerning the environment available at the city's Web site.