DATE: Saturday, July 12, 1997               TAG: 9707120298

SECTION: LOCAL                   PAGE: B3   EDITION: FINAL 

SOURCE: BY STEPHEN KIEHL, STAFF WRITER 

DATELINE: PORTSMOUTH                        LENGTH:   73 lines

PORTSMOUTH UNVEILS THE LATEST REASON FOR ITS HOPE FOR FUTURE

A 150-home subdivision opened Friday atop the rubble of a rundown neighborhood as the city embarked on its plan to increase tax revenue by raising the property value of its communities.

The official unveiling of the Lake Shores development is an example of how Portsmouth, a city without a growing tax base or room for new development, is looking for revenue in new places.

One method is to redevelop old, rundown communities into areas for new homes and businesses, increasing the area's property values and, in turn, giving a major boost to the city's coffers.

Formerly home to the crumbling River's Edge Apartments, the 50-acre site next to Port Norfolk Elementary School was razed last year to clear the way for Lake Shores: three- and four-bedroom homes that complement the surrounding neighborhoods.

``Given the state that (River's Edge) was in, that it was rental housing, that there was a lot of crime in the area, River's Edge had a negative impact on the community,'' said Deputy City Manager Johnna Whitaker, who is also the city's finance director. ``It was in the middle of some very nice family-oriented communities.''

Beyond improving the quality of life in the area, Lake Shores will increase the city's tax base without increasing the tax rate. The property value before the redevelopment was $2 million, said City Clerk Sheila Pittman. With the new homes in place, the property value is expected to be $17 million, raising annual real estate tax revenues from $27,200 to $231,200.

Crime in the area has decreased since the apartments were razed. From 1995 to 1996, violent crimes dropped 26 percent, and total crimes fell 46 percent. And crime is down for the first five months of this year.

Portsmouth is providing the infrastructure needed for Lake Shores: streets, sidewalks, lighting and a lake for stormwater management. And for every lot sold at Lake Shores, the city gets $2,750.

It's a public-private partnership Portsmouth hopes to duplicate elsewhere in the city, Whitaker said.

Fairwood Homes, for example, is housing built after World War II that was supposed to last five years. Fifty years later, it's still there - and not generating a lot of revenue for the city.

Bush Construction Corp. and Portsmouth struck a deal to raze part of the development and build a commerce park.

Bush is now in the process of moving tenants to the sections of Fairwood that will remain and preparing the vacant units for demolition.

``It's a win-win situation for everyone,'' said Marc Sharp, Bush executive vice president. ``The people that will benefit the most from this are the citizens of Portsmouth.''

Making improvements on existing land to increase the tax base is a priority for Portsmouth because the city is small, and much of the land is already developed, Whitaker said.

``We're taking existing property, and if it doesn't have a use on it that's the highest and best use, we're determining what that is and turning it around,'' she said.

Residents who attended the grand opening Friday and toured the three model homes said the new development is a welcome change.

``I remember this when it was all farmland here,'' said Charles Haycock, 73, who has lived in Portsmouth his entire life. ``The new homes really are an asset to the city.''

Half a dozen homes already have been built at Lake Shores. The three developers - Glenrock Corp., NaQuality Homes and Omega Enterprises - hope to have the neighborhood completed in two to four years. The homes range in price from about $100,000 to $140,000. ILLUSTRATION: Portsmouth police officer Oliver Wilson of the city's

Mounted Patrol Unit and his horse, Amy, watch as visitors tour the

model homes at Lake Shores.

RICHARD L. DUNSTON/The Virginian-Pilot

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