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Wellspring House is not only where Nancy Schwoyer hangs her hat, but has also been home to hundreds of needy families over the years.

Schwoyer and a group of friends bought the Gloucester, Mass., house in 1981, with a grand idea of helping people. Twenty-five years later, it's still a shelter and a key part of the community.

Schwoyer is its executive director. Recently, she's also begun to develop permanent affordable housing, recognizing that shelter is not the answer to homelessness - housing is.

Q You and six friends pooled your money together and bought Wellspring House in 1981. What was the idea?

A We were thinking that we really would like to change our lives, [and] that we could share a house that was big enough to share with people who needed a home for a while. That was the kernel of the idea.

Nonprofit organizations often talk about their core competencies. I guess our core competency is hospitality.

Q How many people has Wellspring House served?

A Within a few months, we had people coming to stay - teens and single men. This is a fishing community, so some were coming from the boats. By 1983, the people who were coming swung dramatically to be women and children. That's when family homelessness became visible in Massachusetts and the rest of the country. We then started to focus much more on families.

In the shelter, there have been about 600 families in the last 25 years. We can house seven families at a time. In any given month, we are working with 200 families through housing, education, and family support.

Q What's the most unique service or amenity at Wellspring?

A We have a partnership with North Shore Community College. We offer four courses that are taught here. When an individual applies to North Shore, the college recognizes those credits. A person can earn 12 college credits here.

Another partnership is with North Shore Medical Center. We have a classroom there where we do training for entry-level jobs in clerking positions in hospitals.

Q You still live at Wellspring House. Don't you get burned out?

A I have my living quarters there and take some meals with the families. I have other interests, and some of my work is off-site. I think

it keeps me knowledgeable that this social problem hasn't gone away. It invigorates me to say, "Damn it. We have to do something about this."

Q In 2002, you formed Cape Ann Housing Opportunity, Inc. What is that organization doing?

A In 1988, we developed a separate Wellspring Community Land Trust of Cape Ann and invested money into that. Now, it's called the Community Land Trust of Cape Ann. It has developed 55 units of affordable housing for homeownership.Back in 1998-99, Bruce Tobey, the mayor of Gloucester, convened a group of citizens to look at housing in the city. Wellspring was included in that conversation. Then a big glue factory closed its doors in 2001. The citizens group wondered what was going to happen to this property, which was about 20 acres. So on Christmas Eve, some of us got together. We got word that a big developer was going to raze the buildings and put in high-cost condos. At the table, it was decided that the organization that had the capacity to possibly step in was Wellspring. In January 2002, our board voted to set up a second corporation, Cape Ann Housing Opportunity, Inc., for the immediate purpose of saving this property for community use. Wellspring board members and others put money up and put in a bid. Families will be moving into the first 85 units by August or September. Forty-three will be rental, and they will be for families earning no more than 60 percent of the area median income. Eight will be Sec. 8 units. There will also be 42 condos, including 15 for first-time homebuyers. Another phase is stalled because abutters have appealed a decision by the City Council. We hope there will be 125 units total, 62 percent of them affordable.

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For more information, visit www.wellspringhouse.org. AFFORDABLE HOUSING FINANCE has made the issue of homeless children one of its causes in 2006. That means the magazine will report on the issue during the year and has also made a financial commitment in an effort to help alleviate the problem.

.The unusual thing about this competition is that it judges student teams not just on design, but also on community support and financing, two components affordable developers know are key to getting projects done.

"This is one of the most important things we do all year at Bank of America," said Lindy Hahn, a senior vice president of community development banking at the Charlotte-based lender. In fact, some of the projects presented by students in the past have been developed into actual housing, she said.

The University of California at Berkeley won the challenge this year, with a project to convert a YMCA building into a 155-unit supportive-housing center in San Francisco's gritty Tenderloin neighborhood.