The mayor of Mankato, population just under 1,000, is worried about his city’s infrastructure.

The sewers and streets of the Jewell County city are old, and he can’t figure out how to pay for repairs. It’s an all-too-familiar problem in tough economic times.

But Mayor Donald Hamilton is facing a fact other leaders aren’t: He doesn’t expect the city’s coffers to refill with an upswing in the stock market.

In fact, as time goes on, his problem may get worse.

People are leaving Mankato, as they are most of other small towns in western Kansas, and if the trend continues the problem soon will be simply that there’s no one left to tax.

Unless a new solution harkening back nearly 150 years is just crazy enough to work.

Enter the New Homestead Economic Opportunity Act, a sequel to the Homestead Act of 1862 and a plan to repopulate what has become a different kind of frontier — once-settled land that is quickly being abandoned.

A vicious cycle

U.S. Sen. Sam Brownback, R-Kan., supports the federal legislation that would give government aid to Kansans in rural communities.

The reasons for the bill are painfully clear, he believes.

The U.S. Census Bureau reported that more than half of Kansas counties had high out-migration, a phrase meaning more people are leaving than coming in. In these areas, the average population decline was 10 percent between 1980 and 1999. Of the high out-migration counties, 42 percent reported more deaths than births during that time span.

The harsh conditions facing settlers like Charles and Harriet Hull White, pictured here in the 1880s on their farm near Beloit, were like those experienced by thousands of settlers who gained ownership of the land they lived on through the 1862 Homestead Act. Today the U.S. government hopes to provide help to areas of dwindling population with the New Homestead Economic Opportunity Act.

“Not very many years ago, the population in this county was about 5,000,” Hamilton said. “Now it’s down to around 4,000.”

One reason for the migration from areas like western Kansas is the changing face of agriculture.

Farms are getting bigger and fewer people are required to work them. In rural economies, that means the local grocery and hardware store can’t make ends meet. The situation soon becomes a vicious cycle.

Mankato offers a great quality of life, Hamilton said, and some people return to the town for that reason.

“But if they need a job, that’s tough,” he said.

Like the Homestead Act of 1862, which encouraged pioneers to head west to claim a 160-acre parcel of land, the proposed legislation seeks to reward those individuals willing to take a risk and locate in a high out-migration county, Brownback said.

“It sends a clear message to new homesteaders that if they are willing to make a five-year commitment to live and work in a rural community that is shrinking in population, the government will give them every opportunity to get a college degree, buy a home and build a nest egg for the future,” he said.

Forms of financial aid

The bill offers government aid in three areas: homestead opportunities, incentives for businesses and a homestead venture capital fund.

Under the bill, new home buyers who commit to living for five years in high out-migration counties are eligible for up to $5,000 in tax credits. It also forgives college loans up to $15,000 for recent college graduates who live and work in such counties. And the bill allows homeowners to deduct home value losses from their federal income tax and offers a match up to $2,500 per year, up to five years, for residents who put money into savings.

From the business side, the bill gives tax credits, meant to pay for construction and upkeep, to businesses that move to or expand in high out-migration counties. The tax credit would come from a $1 million credit given to the state for each of its high out-migration counties; in Kansas that amounts to more than $50 million.

The homestead venture capital fund would create a $3 billion federal fund to invest in businesses in struggling counties. This portion of the bill requires the federal government to invest $200 million a year for 10 years. States and private investors each would provide $50 million a year to the fund.

Sen. Byron Dorgan, D-N.D., and Sen. Chuck Hagel, R-Neb., introduced the New Homestead Economic Opportunity Act Dec. 20, 2001, in the 107th Congress. They will introduce it again Tuesday to the Senate Finance Committee. Brownback has promised to co-sponsor the measure.

— Kelly McNearney, a journalism student at Kansas University, contributed to this report.