Pentagon Cuts Put a Squeeze on Army Towns

Welcome sign at Fort Riley, Kansas

A fast-shrinking U.S. Army squeezes military towns and the people in them in unforeseeable ways.

This community of 25,000 sits at the edge of Fort Riley, which is minus about 2,100 soldiers and civilian staffers after cuts in recent years. Real estate agents wonder who will buy hundreds of neighborhood lots and homes built at the peak of fighting in Iraq and Afghanistan.

At the same time, a few newly discharged soldiers have stepped into American Legion Post 45 in Junction City to reveal they no longer have places to live.

"We fix them up for a while with hotel rooms," typically bargain motels near the Interstate 70 exits, said post commander Danny Loehr.

Fort Riley trains fighting forces for war, and as the United States draws down its involvement in wars, Washington knows that the swiftest, easiest way to curb federal spending is to cut the number of ground troops who go into combat.

That reality and the rigors of war have always meant a topsy-turvy economy in Junction City, 120 miles west of Kansas City.

Regional planners this year hope to get to the bottom of how recent force reductions at Fort Riley -- including 615 cuts ordered last July -- have affected local trade, government services and population patterns outside the base.

From that information, the Flint Hills Regional Council hopes to prepare the community for future cuts: Suppose Fort Riley loses 1,000 more personnel by 2018 or 2,000 more by 2020?

"What might be the ripple effects on housing, education, health care ... on tax revenues?" asked Jennifer Jordan, the council's planning manager. She and a Colorado-based consultant are coordinating the analysis, which is funded by a $294,000 grant from an arm of the Department of Defense.

Under a Pentagon force-reduction plan unveiled last summer, the Army was by far the hardest hit of the military branches. The number of its soldiers would shrink by 40,000 by 2017, bringing the Army's active-duty force to 450,000. That's a 21 percent reduction from the Army's peak of about 570,000 regular troops in 2012.

Experts say the cuts could be even more severe by fiscal year 2019 -- down to 420,000 soldiers -- if hard federal budget caps known as sequestration aren't addressed.

Ripple effect

Reductions already at Fort Riley, which has roughly 16,000 uniformed personnel and 5,700 civilian employees, have reverberated through an eight-county region, according to economic impact studies issued yearly by the fort.

"Total economic impact" fell from $1.92 billion in 2011 to $1.58 billion last year, an 18 percent drop, according to the reports.

Huge numbers to swallow

Junction City has gotten used to swallowing them in all sizes -- through peacetime, wartime and troop drawdowns. Even with the Army's reductions, Fort Riley's force today is 50 percent larger than what it was before 9/11.

"We're dealing with a lot of moving parts," said John Montgomery, until recently the longtime owner and publisher the town's newspaper, The Daily Union. "Even when it's said that 18,000 and change are assigned to Fort Riley, that doesn't mean they're physically there. There will always be a brigade or more deployed."

Families move in and out. Schools that count pupils' heads in September have no idea how many kids they will have by year's end.

And some fresh veterans such as Victoria Walton, a Floridian who chose to stay in Kansas, make the rounds at area social service agencies looking for affordable shelter and decent-paying work.

Walton said she was discharged in August as an Army specialist because she was unable to find affordable care for her 2-year-old son. Fort Riley officers were troubled by her bringing the boy to morning calisthenics, she said.

After a month of prodding and still no babysitter, she signed her discharge papers. The Army offered a family care plan and allows her to live on post while she searches for housing on the outside.

"I'd planned on staying in the Army the full 20 years," said Walton, 23. "It's very scary being out. ... There's nothing like having that security that the Army offers."

Many doors out

Army installations achieve their targets for troop cuts in a variety of ways.

In many cases, service members who retire after serving their 20-year terms -- sometimes involuntarily -- are not replaced, said Maj. Olivia Nunn of the Army's public affairs office in Virginia. For younger service members, the lack of promotions will drive some to leave.

Other soldiers will be told not to bother re-enlisting for their present jobs if a medical condition prevents them from performing well, Nunn said.

"They're reducing the not-perfect ones," said Isaac Olney, who left Fort Riley on his own in July. He hoped to make a better living in the civilian world.

Now he hopes to return to active duty and thinks his chances are good. He attained the rank of sergeant before his five-year contract ran out.

His first private-sector job was cleaning carpets, which paid $400 a week. "I was like, 'Ouch,' " said Olney. He's doing a bit better now as the night doughnut-maker in a Casey's General Store.

In Felix Jimenez's 13th year of combat duty, including four tours in Iraq, back problems cut short his plans to serve another seven. "We can't use you anymore," he said the Army told him.

Rather than bone up to score high on tests that would qualify him for jobs he'd like, Jimenez took the Army's $40,000 severance package. He enrolled on the GI Bill at Kansas State University, about 20 miles northeast of Fort Riley.

He already has spent that $40,000 paying off a car loan, other debts and on the high rents of Manhattan.

In his first semester chasing a business degree, Jimenez enjoys noon-hour fellowship in a new lounge and wired-up study area for K-State's Student Veterans Organization. In short time, K-State has made strides to become more veteran-friendly, organizers said.

Just last year, with force reductions nationwide driving more veteran enrollments, the university moved the group's space out of a former supply closet.

Broad impact

The reach of the military economy across Kansas and Missouri might surprise, say officials tapped by governors in both states to protect the region's interest against defense cuts.

"Between 130,000 and 150,000 people in Kansas right now are employed in military activity," said John Armbrust, who directs the Kansas Governor's Military Council. "That's $5 billion in salaries."

The Missouri Senate last month confirmed Armbrust's counterpart, Joe Driskill, as the state's military advocate.

In his role directing private-public groups promoting the betterment of Fort Leonard Wood and surrounding communities, he has seen that base take two hits since 2014 that claimed more than 1,900 military and civilian positions.

In February, the post in the Missouri Ozarks announced the inactivation of the 92nd Military Police battalion, consisting of more than 700 soldiers. Many will be reassigned to other units or routed to other parts of the globe.

Fort Leonard Wood is among four Army bases that provides basic training of new recruits. Driskill said that as recruiting eases, "it's unlikely the Army will feel it needs all four" and the Missouri base would have to make its case to remain among those where basic training takes place.

Lose basic training, and lose the ceremony crowds.

As in the Junction City area (and even Kansas City), hotels housing families and military dignitaries traveling to on-post graduations or deployments generate revenues and jobs in the small cities surrounding Fort Leonard Wood.

A 2013 study found that Fort Leonard Wood supports, directly or indirectly, 36,400 jobs, including hundreds of hotel and restaurant workers.

In and around Leavenworth, a bistate economic development group called the 27 Committee reported that the fort had more than $880 million in direct economic impact in 2015.

That included $27 million in travel spending -- mostly on airline tickets and lodging near Kansas City International Airport, said Rich Keller, the committee's vice president.

Keller said Fort Leavenworth doesn't feel the reduction pressures of other Army installations. Its personnel count of 9,800 mostly consists of instructors at the Command & General Staff College, more than 1,000 visiting students and guards at the fort's famed prison.

"Cutting the fighting forces is where you get big numbers" and quick savings, Keller said. The implication, though, is that those are forces that can't be sent off in case of war.

Uneven cuts

Losses so far at Fort Riley could be much worse.

At Fort Benning, Ga., the Army last year ordered 3,402 positions to be eliminated by 2017, a 29 percent reduction from the fort's 2015 force levels. Fort Hood, Texas, would lose 3,350 soldiers, a 9 percent cut.

The reduction of 615 at Fort Riley, already completed, represents 4 percent of troops.

To many residents and businesspeople, that's just another blip in a community that is regularly buffeted by deployments and the economic ebbs and flows of military life.

"I'd be crazy if I weren't concerned by (Army reductions). Its down, down, down every year," said Randy Tholstrup, who for 18 years has owned an off-post Army surplus store called Military Outlet.

Tholstrup said sales this year are down more than 20 percent, but he thought it had less to do with soldiers dwindling away than with local unease over the presidential election.

The long-term future of force reductions stirs worries in Junction City's overbuilt residential real estate market.

In 2005, the city received word that 8,000 troops would be transferred to Fort Riley. In response, the city annexed 1,400 acres and assumed $190 million in debt in hopes that developers would build more than 1,500 houses.

Not half got finished. The housing bubble burst, and "the numbers of troops never showed up as planned," said City Manager Allen Dinkel, who was not part of Junction City's administration at the time.

After a former mayor and developer were convicted of fraud, a court forced the city to take back hundreds of barren lots. Some now languish on the market, awaiting minimum bids of $5,000.

"This town has a lot of potential," said Larry Johnson, a Reece-Nichols broker who opposed the development plan. But with further Army reductions on the horizon, he doesn't see where the people will come from to buy all the properties.

At least one beam of light arrived in 2014: A massive call center, Advanced Call Center Technologies, moved into a sprawling building and put 400 people to work.

Many of those workers had just left the Army, involuntarily or by choice.

They included Kanesha Mercer, whose post-traumatic stress from three war-zone deployments in a communications unit spoiled plans to make a career in the Army.

"I had to use my weapon a few times on other people," Mercer said. "The worst part of the transition to civilian life early on was not wanting to talk to people (about her service). ... I wanted to try to hide and keep moving forward."

A year into her job at the call center, she's been promoted to supervisor of billing. "This job makes the transition easy," she said. "Now I love talking to people."

The company's human resource director, Sandy Coffman, chimed in: "And she's here to stay with us."

It's only a call center, but its employment is expected to double past 800 by next year.

All the more civilian paychecks for a rising tide of veterans who need them.

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