A St. Louis Park housing program for low-income mothers and children is abruptly shutting down much of its operation because of financial problems — even as the need for its services swells.

Perspectives, founded 40 years ago, provides child care, drug treatment and mental health care, and houses residents in a tight-knit complex of five apartment buildings comprising about 50 units in the Louisiana Court cul-de-sac. In mid-December, the organization ended its children's programming and clinical services — but promised residents they would not be displaced from their housing.

Hennepin County Sheriff Dawanna Witt called the news "devastating."

"At a time when we're talking about fentanyl, the drug epidemic, juveniles and not enough resources, a program that has been a pillar in the community is not going to be able to provide some of the services that we know had worked?" asked Witt, whose late brother George Bickham worked at Perspectives for two decades. "That is a travesty. I mean, I just don't understand it."

The situation on the Perspectives campus is rapidly evolving. The organization's financial challenges are long term, stemming in part from federal decisions about how and where to fund housing. But the board of directors' decision to wind down the program this holiday was unavoidable amid mounting debt of about $3 million — roughly the size of Perspectives' annual budget.

"We did not have enough money coming in to maintain the staffing that we had or the programming, said Board Member Patricia Weller, "and we don't see being able to cash flow for the foreseeable future."

A high-bar sober community

Perspectives was founded four decades ago by Jeannie Seeley-Smith, who recently retired as CEO.

She ran the campus as a sober refuge for mothers who are dedicated to long-term recovery from addiction and require short-term transitional housing to get there. Applicants are interviewed, male visitors screened. Perspectives provided case management, peer support, fully furnished apartments and services like day care and after-school tutoring. The goal: help women graduate with rental history, job experience and their kids on solid academic footing.

But about seven years ago, the U.S. Department of Housing and Urban Development (HUD) shifted its focus, directing more money to housing providers that employed "housing first," an evidence-based strategy to reduce homelessness by getting people under roofs without requiring sobriety.

Despite its core identity as a sober community, Perspectives attempted to shift to that model to avoid losing funding. But the unintended repercussions were swift.

The organization could no longer turn away applicants who were not ready for treatment, and a few women who actively used heavy drugs began to undermine their neighbors' best efforts to stay sober. They didn't have to talk to case managers or participate in clinical programming, and Perspectives couldn't bill their insurance for those medical services — a key income stream.

Seeley-Smith said there's a place for harm reduction and housing first, but it was incompatible with Perspectives' mission.

"[Housing first] is not a recovery model, that's a housing model," said Seeley-Smith. "It's basically warehousing people to get them off the street, but we were breaking the cycle."

Emergency calls for service to Perspectives started to spike around 2017, according to St. Louis Park police data. There were overdoses, men sneaking into the campus and violence; in 2019 police shot and killed a man on the Perspectives campus while responding to a domestic dispute.

Hard cuts

The 911 calls decreased last year after Perspectives reversed course and recommitted to accepting only women who were serious about sobriety.

But that shift meant less funding; HUD declined to renew funding for Perspectives' transitional housing project.

"Certainly something that HUD looks at in terms of whether our overall community gets more money or less money is to what extent are our portfolio projects adhering to a housing first model," said David Hewitt, Hennepin County's director of housing stability. HUD, which uses various measures to prioritize the lowest-barrier organizations that are using data to serve the most vulnerable people in society, cut Perspectives "quite hard" in recent years, he said.

Perspectives continued to receive Hennepin County, state and philanthropic donations, but could not stay afloat amid those cuts.

A few remaining staffers have been working to outsource their clients' treatment to third-party providers. Weller, the board member, expressed remorse over the loss of jobs at Christmastime, after finding out Perspectives could not afford to meet its payroll obligations through the end of the year.

One of the six staffers still living on-site at Perspectives is St. Louis Park Council Member Yolanda Farris, herself a 2016 graduate of the program.

As a staff member, Farris was not allowed to discuss the recent changes at Perspectives, but she previously told the Star Tribune that were it not for the program and its high expectations, she would not have stayed clean after struggling with addiction for 34 years.

"I'm so grateful for programs like this because after I got out of treatment, if I went back to where I came from, it kind of would have defeated the purpose, you know," she said. "I'm glad that I came here. … I needed to learn how to live sober."

Last week, Perspectives held one last holiday party for its residents. It was a tearful occasion; women bid farewell to laid-off staff members who had provided child care and treatment services. The kids retrieved their arts and crafts from the classrooms. Everything from the food shelf was given away.

Star Tribune staff writer Josie Albertson-Grove contributed to this story.