#088 Jul/Aug 1996

Building Links

Baltimore’s Community Housing Associates provides permanent, supportive, scattered site housing for people with mental illness The mental health community has come to view stable housing as critical to the continued […]

Baltimore’s Community Housing Associates provides permanent, supportive, scattered site housing for people with mental illness

The mental health community has come to view stable housing as critical to the continued recovery of the deinstitutionalized mentally ill. In an effort to create more stable housing opportunities, Maryland and many other states have begun helping mental health consumers own, rather than rent, housing. The challenge is to link housing development and management with mental health expertise as efficiently as possible.

Community Housing Associates (CHA) of Baltimore, a nonprofit housing development and management subsidiary of Baltimore Mental Health Systems (BMHS), was created for this purpose in 1989. BMHS, the omnibus mental health authority for Baltimore, was founded in 1987 under a $2.5 million grant from the Robert Wood Johnson Foundation to improve mental health services citywide. Although not a direct service provider, BMHS administers and monitors the city’s publicly-funded mental health services for adults – formerly the responsibility of the health department. With a staff of 28 and an operating budget of $3 million, BMHS oversees approximately $25 million in state funds, distributed to clinics, rehabilitation programs, and housing programs.

CHA was created as a condition of a housing loan from Robert Wood Johnson. CHA coordinates housing activities, while BMHS ensures that tenants have access to flexible mental health services. CHA also lends its expertise to other organizations seeking to develop housing for the disabled in the Baltimore area.

Program Overview

Emphasizing individualization and normalization, CHA develops and manages a range of housing units throughout Baltimore’s neighborhoods for adults with mental illness who are capable of independent living. Most of CHA’s tenants previously resided in institutions, unstable living environments, or overpriced, low-quality housing. Because unstable housing is a major cause of reinstitutionalization, CHA aims to provide stable, affordable, permanent housing for people with mental illness. CHA develops independent units near public transportation and relies on case managers to provide support services. This model separates housing from services; separate organizations use separate funding streams.

In 1991, CHA purchased its first property, a mixed-use building with three rental units and basement and ground floor space leased to On Our Own, a self-help group of people with mental illness. The following year, CHA undertook its first major development, acquiring and rehabilitating 15 buildings totaling 24 units in several west and east Baltimore neighborhoods. In 1994, CHA and the Alliance for the Mentally Ill (AMI) initiated plans to acquire and rehabilitate 17 properties in six Baltimore neighborhoods. Altogether, this will provide 22 units (six one-bedroom and 16 three-bedroom) of rental housing for individuals and families.

Target Population

BMHS seeks tenants who are mentally ill but capable of living independently. Reflecting Baltimore demographics, most tenants are African American. All are earning below 60 percent of the area median income. Most are not employed, but many attend day programs for simple job training or to socialize.

CHA I units are rented to 36 individuals with mental illness and nine families, each with an adult with mental illness. Five of the buildings are master-leased to service providers for their clients. To minimize the potential for conflict, CHA prefers to rent its three-bedroom units to families, rather than three unrelated individuals. For CHA II, families whose head of household is mentally ill are to live in half the 16 three-bedroom units, single adults with mental illness are to occupy the one-bedroom units, and the remaining three-bedroom units will be master-leased to service providers for the mentally ill.

Building Features

Although cost considerations forced CHA to avoid the very expensive neighborhoods, it has nonetheless been able to meet its objective of rehabilitating scattered-site townhouses in decent neighborhoods.

Each rowhouse has up to two self-contained units. Generally, only minor adaptations are needed, and, although CHA provides no special landscaping or play areas, the buildings retain their traditional residential appearance and features. The single-family homes have laundry facilities in the basement, and in two-family buildings each unit has a stacked washer/dryer. CHA tiles common areas and restricts carpet to bedrooms, due to the high rate of smoking among people with mental illness. Although building code does not require it, CHA’s next project will also include a sprinkling system.

Support Services

In Baltimore, the mental health delivery system is divided into seven catchment areas, each with a lead agency responsible for coordinating clinical mental health programs, housing programs, emergency services, daily programs, and case management. Each catchment area’s case management unit helps mentally ill tenants access necessary services. Residents of CHA’s developments are assigned case managers, who coordinate the residents’ access to therapy, medication, entitlements, and utilities, and draw up individual treatment plans for each client.

Management Structure and Policies

CHA manages but does not market properties; rather, residents are selected from CHA’s waiting list, of about 50 clients, and the waiting lists of local service providers. When a vacancy occurs, CHA notifies the catchment area’s community review committee, which refers people with mental illness to available housing.

CHA receives a two-page form from social services providers – condensed from a much more extensive application used to determine mental health eligibility – providing housing and demographic information. CHA interviews potential residents to assess their ability to live independently, conducts home visits, and performs credit checks.

Residents pay 30 percent of their income toward rent. Service providers with master leases pay market rent, as allowed by their state grants. In order to ensure timely payment, some residents sign over their monthly SSI check to BMHS, which then pays rent, utilities, and other bills. CHA I collects approximately $115,000 annually in rent.

CHA uses a standard lease that makes no reference to tenants’ mental illness. Tenants cannot be evicted for refusing to continue working with their case managers; they can be evicted only if they violate the terms of their leases. Leases are renewed annually, once tenants’ ongoing income eligibility has been verified.

The case managers are responsible for acclimating tenants to independent living, and for resolving tenant problems – the majority of which are drug-related. If CHA suspects drug or alcohol abuse, it calls the case manager. Due to first-time tenants’ inexperience in caring for their units, CHA has encountered higher-than-expected maintenance costs, and it now conducts annual site inspections to check on housekeeping habits and identify needed repairs and maintenance.

According to CHA, tenants so far have not been interested in participating in a residents’ council, despite its offer to establish one. This is largely attributed to the scattered-site nature of the housing, which does not promote much interaction among tenants.

Community Relations

CHA minimizes community opposition by selecting only tax-foreclosed rowhouses that fit the neighborhood and do not require zoning changes. Site approval is obtained from the lead mental health agency in the site’s catchment area. While CHA has not always obtained community support, local opposition has never prevented it from developing a site.

After a few years of operation with no problems, neighborhoods have seemed to accept CHA’s developments. In developing CHA I, CHA met with representatives of the various communities in which it planned to locate units. To date, CHA reports that it has received no complaints from these groups about the houses or residents.

Funding Sources

A conventional bank mortgage and a grant from the Community Bond Program of Maryland’s Department of Health and Mental Hygiene funded the purchase and partial rehabilitation of CHA’s first multifamily property.

Financing for acquisition and rehabilitation of 15 buildings by CHA Limited Partnership I totaled $1.87 million and included a $1 million low-interest loan from the Maryland Department of Housing and Community Development; $200,000 from the Maryland Community Bond Program; and $591,000 in equity from limited partner investors attracted by the federal Low-Income Housing Tax Credit through the Enterprise Social Investment Corporation.

Similarly, acquisition and rehabilitation of 17 properties totaling 22 units through CHA Limited Partnership II is expected to cost $2 million and be financed by a $1 million loan from the State Community Development Administration, a $282,000 grant from the city’s HOME program, a $167,000 grant from the Community Bond Program, and equity from investors though the Low-Income Housing Tax Credit.

With a HUD Section 811 grant, CHA and BMHS have also created Housing Associates, Inc., a separate, sole-purpose nonprofit, to acquire, rehabilitate and manage five properties as 15 units of rental housing. Along with funds for acquisition, rehabilitation, construction and development, HUD’s Section 811 program provides Section 8 rental subsidies.

BMHS and CHA have also worked with the city of Baltimore on three successful applications for funding from HUD’s Shelter Plus Care program, under which CHA leases units from private landlords and subleases them to homeless people with mental illness.

A variety of sources also fund operating expenses. BMHS pays CHA staff, while CHA pays BMHS for services and raises grants to help defray predevelopment and administrative costs. The Maryland Housing Development Assistance Program (HODAP) and the Maryland Affordable Trust Fund have also provided funding. The State Mental Hygiene Administration covers case management costs through funding to service providers.


CHA focuses on two measures of success – rent collections and evictions – and considers its housing successful on both accounts. The majority of problems with tenants have been resolved through meetings between tenants and case managers. Four evictions were due to public misbehavior, illegal drug use, and failure to pay rent. In 1994, vacancies from two families and two individuals who moved were filled quickly. At the end of the year, only one bedroom in a shared apartment was vacant.

As a housing provider, CHA does not collect data to track or evaluate residents. Baltimore’s Client Information System keeps such records in its 12,000-person data base. Service providers and state inpatient facilities, representing more than 130 different programs, provide data. To improve data collection, BMHS has designed social service information software to help evaluate clients.


To link housing development with mental health services, CHA’s executive director offers the following advice:

  • Learn from other nonprofit housing developers about potential funding sources for special needs housing, not necessarily restricted to people with mental illness.
  • Survey local needs for affordable housing for the mentally ill and the availability of appropriate housing, and identify key gaps you want to fill.
  • Hire a housing expert to work with other nonprofit housing developers; do not expect mental health providers to become housing experts.
  • Know your housing market and identify specific properties that fit available funding; CHA makes use of Baltimore’s large supply of vacant, single-family or two-family buildings.
  • Avoid using large properties, which are too institutional for the mentally ill and raise “Not-In-My-Back-Yard” concerns, even though these properties are often less expensive to develop.
  • While the sources of funding will largely determine the legal structure of the development, be prepared to create affiliate organizations for specific housing developments.
  • Be prepared for the amount of time required to develop housing; use consultants to minimize costly mistakes and delays.

CHA’s model separates housing from support services, and its executive director considers this to be the key to CHA’s success. Intertwining housing and support services funding, he believes, unnecessarily complicates the project.

Contact: Alan Kaufmann, Executive Director, Community Housing Associates, Inc., 201 East Baltimore Street, Suite 1340, Baltimore, Maryland 21202; (410) 837-2647.

This case study is excerpted from Beyond Housing; Profiles of Low-Income, Service-Enriched Housing for Special Needs Populations and Property Management Programs, published by The Enterprise Foundation in June 1995. Available for $15 from The Enterprise Foundation, Communications Dept., 10227 Wincopin Circle, Suite 500, Columbia, MD 21044.



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