Laconia Daily Sun – April 4, 2025
By ADAM DRAPCHO
Lakes Region Community Developers optimistic Bay Street apartments will open soon, as planned
LACONIA — There was a celebration last week on Bay Street, where a group gathered for a ribbon-cutting meant to mark the opening of a development representing a new approach to addressing housing instability. The festive mood was tempered, though, by a troubling reality: as significant as the Bay Street model is, the curtailing of federal investment into such projects means the conventional financial plan for creating supportive housing no longer applies.
The apartment building at 17 Bay St. is a joint project of Lakes Region Community Developers and Lakes Region Mental Health Center, and aims to provide stable housing for people who are simultaneously experiencing both housing insecurity and mental illness. The building has 12 single-occupancy apartments, and residents will have a clean, safe place to live, as well as built-in case management.The building on Bay Street is focused on a very limited corner of the housing picture. But it’s a corner that has largely been unserved. Carmen Lorentz, executive director of LRCD, said there are already enough applicants to fill the building as soon as it gets an occupancy permit, and to start a waiting list.
The project is a solution to a problem commonly encountered by people trying to deal with concurring problems of mental illness and housing stability: it’s hard to address mental health while living on the streets, and it’s just as hard to find stable housing while experiencing mental illness. The Bay Street apartments offer a unique solution meeting both needs at the same time. But it isn’t an inexpensive proposition. The way LRCD and LRMHC were able to make it work was by leveraging federal grant monies to help pay for the building’s construction, as well as federally-backed rent vouchers to help residents cover rent while they work to stabilize their lives.
Lorentz said it cost about $2.6 million to build the apartments, and federal funding amounted to around $2 million of that total. More federal funding will be realized as each month’s rent payments are made. Both sources of federal support are unavailable for the foreseeable future, as the Trump administration effects major reform to government spending. That means as promising as projects such as that on Bay Street might be, there is no longer a clear model for them to work financially.
Lorentz believes the Bay Street project will be able to go forward, but LRCD won’t be able to build any new such projects until either federal funding is again available, or some other form of support is found. And that support would need to be both for the initial construction costs as well as ongoing assistance with rent. “On top of the money to build the thing, the people that are going to be living there are going to have no income at first or very low income, and they have no money to pay rent,” Lorentz explained. “The project-based rental assistance is critical.”
Much of federal housing funds spent in New Hampshire are routed through NH Housing, a public corporation created by state law. Robert Dapice, executive director and chief executive officer, said NH Housing administers some 4,200 housing vouchers.Funding has been a stumbling block for rental assistance for years. Funding levels have been flat for a few years, which when combined with rising housing costs works out to mean fewer people can be helped each year. “Because the budget has remained stagnant, the cost to us to subsidize people’s rent has gone up a lot because rent has gone up,” Dapice said. “That means we don’t have the ability to add people to the program like we used to.”
In past years, Dapice said NH Housing would be able to give new rental vouchers to around 300 people per year from a waitlist, and to add about 20 to 50 new site-based vouchers as well. Both of those addition mechanisms are now frozen, as Dapice doesn’t expect to be able to fund them. “We don’t know how much we’re going to get from [Housing and Urban Development] next year, it seems likely that we will not be able to pull hardly anyone off the waiting list,” Dapice said. And he doesn’t expect to be able to add any new site-based projects, such as supportive housing models like Bay Street.
Dapice called projects such as Bay Street “critical” in addressing the housing crisis.
“We need more of that kind of housing,” Dapice said. He’s encouraged for long-term prospects, as policy makers seem convinced of the existence of a housing supply crunch, and are poised to enact changes that could increase the supply of housing. That won’t help in the short-term, though. “What the state is experiencing is not just a supply problem. We have a resulting affordability problem that is affecting people who are more vulnerable. The fact that we aren’t able to add housing that addresses those specific needs is a problem,” Dapice said.
Lorentz said she finds the experience frustrating — she feels she and her partners have found a solution that could be life-changing for lots of people, and now they lose their ability to pursue those strategies. “I think everyone in the affordable housing world is very concerned about what the future may hold,” Lorentz said. “At a time when everyone is complaining about housing, we’re going in the complete opposite direction.”