Paca House overhaul to bolster affordable housing supply

A planned $27 million rehab and expansion of the Paca House will provide affordable housing, particularly for veterans, as Baltimore struggles with a shortage of those units.

Volunteers of America Chesapeake Inc., via a joint venture with Somerset Development Co., believes re-positioning the property will ensure its long-term physical and financial viability in serving low-income city residents. Volunteers of America completed the original adaptive reuse of Paca House in 1996.

“Affordable housing is probably the biggest gap in solving homelessness,” Russell K. Snyder, president and CEO of Volunteers for America Chesapeake Inc., said.

Paca House at 116-120 Paca St. consists of 76 single-room units and 30 efficiency apartments. In the roughly 22 years since the project was completed its basic dorm-room style has become outdated.

Planned improvements and additions will allow for the conversion of the single-room units into efficiencies and one-bedroom units with self-contained kitchens and bathrooms. The final unit mix will provide 41 efficiencies and 51 one-bedroom units.

There will be 19 units designed and set aside for homeless veterans, and an additional 63 apartments will be subject to a veteran’s preference policy. There will also be 10 market-rate units primarily marketed to university students, and others will be available to residents making up to 60 percent of area median income.

The Paca House overhaul is scheduled to break ground in May. The project is expected to be fully delivered in August 2019. Construction will require residents to be temporarily relocated, but those in good standing will not be permanently displaced.

Denise Smith, who lives at Paca House and works at the front desk, struggled with addiction, incarceration and homelessness. Now, with 14-years in recovery, she credits the staff at Paca House with giving her a new start.

“I’ve got a lot of love for the staff here because without them I don’t know where I would’ve been at,” Smith said.

Angelier Hill, 56, who has lived at Paca House for nearly three years, also grappled with homeless, incarceration and addiction. After 30 years of fighting her demons, she said, Paca House provides a place of comfort.

“This here was a relief, like freedom. You know, I get to find out who I am and what I want and spend time with me, and I enjoy it,” Hill said.

The overhaul of Paca House comes as Baltimore is struggling with an affordable housing shortage. Despite a boom in multifamily housing newly constructed units are generally out of the price range of even professionals such as teachers, police officers and firefighters.

City officials and housing activists have proposed a variety of methods to bolster affordable housing development, but at the same time they face new challenges.

In November 2016, city voters approved amending the city charter to create an Affordable Housing Trust Fund. City Councilman Bill Henry has submitted legislation proposing increasing taxes on the sale of properties to support the fund. The City Council is also in the process of forming a task force to examine potential revenue streams for affordable housing.

Activists, pushing what they call the 20/20 Campaign, are urging the city to annually invest $20 million in building permanent affordable housing and $20 million for jobs deconstructing vacant properties using general obligation bonds. Baltimore intends to increase bond spending in the next two years but not to the level activists want.

As the city searches for money for affordable housing, the most important source of investment in that sector is expected to take a hit. Federal tax reform, approved late last year, slashes corporate taxes. As a result developers anticipate demand for Low Income Housing Tax Credits to decrease. In some cases production of units is expected to plummet 14 percent.