Patricia Borns

pborns@newsleader.com

STAUNTON – A big man with shining brown eyes, William Pierson was a long-haul truck driver until macular degeneration robbed him of most of his sight, a livelihood and a roof over his head.

Now the Valley Mission resident was standing on the balcony of a like-new apartment flooded with sunshine and a view to distant hills.

"Oh man, this is great," Pierson said, loving everything about the one-bedroom unit, which includes all utilities and cable TV in its $300 per month rent. Even the efficiency kitchen was a positive for him: "Awesome. I prefer cooking in a crock pot."

Downtown Staunton used to have options for people in need of affordable housing — the Stonewall Jackson Hotel, until its renovation in 2005, and the Beverley Hotel, before its residents were scattered in 2011. Now demand far outstrips supply, and the neediest shuffle between homeless shelters, short-term psychiatric beds and jail.

But a renovation at the corner of Kalorama and Coalter where Pierson is an applicant will be a life changer for eight lucky tenants when it's completed in February. And, maybe, a game changer for reclaiming historic properties downtown.

Gentrification tour de force

Renovate it and they will come used to be the watchwords of the nation's downtown Main Street programs, whose holy grail is to upscale local economies through preserving historic housing inventories.

But the high cost of renovating old buildings has taken its toll, as Valley Area Community Support Inc.'s Clarke Banta found while looking at dozens of them for potential purchase to turn into affordable housing.

"We find so much substandard housing because people can't afford to maintain them," Banta said. "They're old houses, many of them single-family homes that were adapted for rental use on the cheap by throwing up a wall."

In a historic district, a run-down property left to "demolish by neglect" eventually becomes a tear-down, then a vacant lot awaiting a white knight developer to build luxury units in its place. It can take years, or decades, for such a developer to appear.

When VACSI started the 240 Kalorama St. project, the property was unrecognizable from its Craftsman-era glory days. The shower stall in one apartment leaked into the basement. The rickety back porch rails were an invitation to a personal injury lawsuit. The rear of the building needed a new foundation.

Working with city historic district planners, Banta recreated the building's historic façade with columns flanking two period front doors. Originally, it had two grand apartments, each on three floors, but decades of hatchetwork had carved out five rentals.

Banta knocked down the walls and designed eight units, each with more light and open space. The materials and color schemes are historically correct and tasteful, and the workmanship is first-rate.

"The contractors have a heart for this work," he said. "We've given the building another 100 years of life."

They also have a heart for doing good. VACSI got the engineering certification done for free. The old gas boiler was replaced with a heat and AC system — no more window AC units — and the building got its first foam insulation, which should cut utility costs 50 percent.

When the landlord pays all utilities, economies of scale are possible, too. "We didn't need a separate electrical box for each unit," Banta explained. "Same with cable, a decent package nets out to $4.60 a unit a month when the landlord pays."

Utility-inclusive rents also protect the tenants, who Banta discovered were often getting suckered into cable discount promotions that left them with sky-high bills when the promotion period ended a few months later.

Between grants, donations and a sympathetic owner willing to hold the mortgage, VACSI pulled off a rehab that would otherwise cost tens of thousands of dollars and require correspondingly high rents.

Instead, the like-new building improves its neighborhood — "What a fantastic job you're doing," the neighbors comment, according to Banta — which includes an upscale eatery, The Shack, across the street.

But the tenants won't need a foie gras income to live there. They're people like Pierson, and a man calling himself Russell who said his disability check currently pays $1,217 a month for him to live with two others in one room of an assisted living facility, and Scott Lucas, a soft-spoken bipolar man who does odd jobs for Banta in exchange for a rental discount.

"I can't get over how it turned out," Lucas said.

Challenges ahead

Kalorama Street is VACSI's second historic building conversion — the nonprofit's flagship 1314 West Johnson Street project began in 2012 — offering the lowest rents yet. With the experience and partners it's gained, Banta believes the tiny nonprofit could complete a project a year.

But financially, the future is uncertain.

Soon after its founding in 2005 by a group of concerned volunteers, VACSI partnered with Valley Community Services Board, renovating the former Effie Ann Daycare Center on Johnson St. for the agency's use. VCSB invested $400,000 to customize the facility where its PACT office was based. The monthly rental gave VACSI a steady source of income so it could dream of other affordable housing projects — or so the nonprofit thought.

Recently, to curb a financial deficit, VCSB pulled the plug on the rental and consolidated the staff under its Sangers Lane roof.

"Our board was taken aback," Banta said. "They had thought the relationship with VCSB, a multimillion-dollar organization, would provide long-term stability. The move endangers all we wanted to do."

Valley CSB Executive Director David Deering attributed the deficit to a combination of circumstances prior to his assuming the agency's helm. From January to March this year, they ran at a loss of $313,386 with an 11 percent decline in billable services. Especially challenging is the CSB's mix of payers, each with different schedules and structures, and the ever-declining reimbursement for Medicaid services.

"Just by consolidating the case workers at the home office rather than renting the Johnson Street space, we estimated saving $72,000 a year," Deering said.

The real losers, however, may be the clients of both organizations: people dealing with disabilities and other issues who can't afford market rents.

"Any time we open up an apartment, we see no end of applicants. I think we could double our capacity and not fill the need," Banta said.

On that, both organizations agree.