Supportive housing empowers residents with an opportunity to overcome staggering difficulties to live their lives in dignity. Today, nearly 600 extremely low-income residents in Milwaukee County depend on supportive housing to keep a roof over their heads. Without it, our most vulnerable Milwaukeeans face the loss of case management, treatment, medication, critical support – as well as their homes.
But now, this essential housing teeters on the brink of collapse.
Tragically, every Milwaukee project is now hemorrhaging serious money. The reason is not complex. It is impossible to take an average annual rent increase of 3% and cover average annual increased costs of 20% for employees, auditing, insurance, and administrative expenses. Massive security costs often yield a $3,000 – $4,000 weekly expense alone. A population grappling with difficult problems routinely means more police incidents, fires, break-ins, drug dealing and other difficulties that incur unexpected expenses.
Cardinal shoulders the vast majority of these costs, and former partners who supported this housing in the past are now unwilling to help, invest or actively work in difficult neighborhoods. The loss of investments from banks, nonprofits and the private sector has fueled a massive funding shortfall.
This financial crisis now imperils the future of supportive housing in Milwaukee, and threatens a humanitarian disaster for the hundreds who today rely on our properties. Behind every statistic is a real person on the verge of a crisis. Cardinal’s team takes a personalized approach to our residents’ situations, and coordinates tirelessly with healthcare workers, social service providers and first responders to ensure residents can safely stay in the housing we provide.
Many of our residents suffer from severe paranoia and other challenges, and most landlords would simply evict them instead of tolerating these disruptive behaviors. We know we make a difference too: over the years many of our residents have sadly been diagnosed with terminal illnesses, and they have declined hospice care to stay in their Cardinal Capital homes through the end. These are people who have been plagued by homelessness for most of their adult lives, and they value the dignified quality of life found at our facilities.
And not only does Cardinal’s supportive housing give struggling people the chance to live full lives, it saves Milwaukee City and County substantial sums of money each year as well. A reasonable estimate is $25,000 saved per supportive housing unit. Considering the 300 plus units Cardinal manages and maintains, this represents a savings benefit to Milwaukee City and County of about $7.5 million annually.
Humanitarian disaster ahead if we don’t shore up housing programs
The economics are no longer sustainable, and without change now Milwaukee will lose substantial housing that helps our most vulnerable neighbors. It’s time for an emergency community-wide response to stave off a social service calamity. Without new sources of revenue, crucial supportive housing facilities will fail. This will result in higher serious crime, a loss of quality-of-life, and more frequent public health issues like homelessness, overdoses and mental health episodes in Milwaukee.
We have asked WHEDA, Wisconsin’s primary housing agency, for an emergency investment of $1.3 million to keep five properties afloat that are in immediate peril of going under. This band-aid will help in the short term, but we also desperately need all community stakeholders – including philanthropic givers, lenders, health and social service funders, and the city, county and state, to join together next month to develop a long term plan for 2024 and beyond. We will be working diligently to convene this supportive housing summit early in the new year.
The time is now for the Milwaukee community to come together and save the vital supportive housing that has saved so many of our neighbors.
Clarence Johnson is President and CEO of Wisconsin Community Services. Erich Schwenker is President of Cardinal Capital Management. Dan O’Connell is Executive Vice President of Cardinal Capital Management.