photo by: Bert Nash Community Mental Health Center

These plans show a supportive housing project that Bert Nash Community Mental Health Center plans to construct in north-central Lawrence.

Bert Nash Community Mental Health Center is stepping away from a permanent supportive housing project and may have to give back more than half a million in Affordable Housing Trust Fund dollars after missing a city construction deadline.

Kirsten Watkins, CEO of Bert Nash, told the Journal-World in a statement that after a careful review and internal discussions, the organization is stepping away from a permanent supportive housing project near the intersection of Sixth Street and Rockledge Road.

Bert Nash was planning to build a 43,000-square-foot facility with an office hosting staff members like case managers and outreach coordinators with two dozen single-room units sitting on top of it, as the Journal-World reported. Those apartments would serve individuals with low or no income who are also experiencing serious mental illness.

“While we strongly believe in the importance of permanent supportive housing in our community, we determined that serving as the lead entity for this project does not align with our core mission and long-term strategic priorities,” Watkins said via email. “We are currently working with community partners and contributors to determine the most effective path forward for the project and to ensure that the funds already dedicated to it are thoughtfully transitioned to another party that can carry the work forward.”

Bert Nash indefinitely paused the project due to the organization’s ongoing financial challenges, Lea Roselyn, the city’s affordable housing administrator, said. As the Journal-World reported, Bert Nash has been undergoing financial challenges since the beginning of 2025. Bert Nash came to commissioners in December 2025 with a $1 million funding request for 2026 to support a revenue gap in the new Treatment & Recovery Center’s ongoing costs, but county commissioners deferred the request until a financial and operational review is completed.

The organization has been discussing possible ways the project could still happen, and one option on the table is handing the entire project over to Douglas County to take the lead.

“…Bert Nash has entered discussions with Douglas County about options to move the project forward, including the option of relinquishing the project in entirety to Douglas County,” Roselyn quoted from the year end report to the city on the project. “Bert Nash is also exploring options to possibly remunerate the City of Lawrence and Douglas County in the event the project is unable to move forward.”

While Bert Nash is stepping down from the supportive housing project, the city already allocated over $550,000 from the Affordable Housing Trust Fund – which is supported by a local sales tax to increase affordable housing options for households at or below 80% of the Area Median Income. All that money could need to be given back to the city.

According to a memo in the agenda for next week’s Affordable Housing Advisory Board meeting, construction on the project has not commenced by a Feb. 2, 2026, deadline outlined in a city funding agreement with Bert Nash, and the project’s scope has changed.

The City entered into two separate Affordable Housing Trust Fund agreements with Bert Nash – one in 2023 and the other in 2024 – to help support the development of the 24 permanent supportive housing units.

However, city staff want to discuss the project further with board members because both the 2023 and 2024 agreements state that if construction has not begun within two years of signing, the city may have the right to require Bert Nash to repay the funds. The 2024 agreement was signed on Feb. 2, 2024.

The agreements also say if the city discovers that the grantee of the funds violated the terms of the agreement within five years after the agreement was signed, the city would “have a right to clawback” those funds.

In 2023, the city provided Bert Nash with $108,000 and $450,000 the following year, bringing the total allocation of Affordable Housing Trust Fund dollars to $558,000. The memo said those funds “have been spent, primarily on land acquisition, design, engineering, and environmental work.”

In addition, the memo said the project’s scope has been modified from constructing 24 supportive housing units to 12. “The agreements require 22-24 units,” the memo said. “A 12-unit development is materially below contractual scope.”

Roselyn said that city staff will be asking the board “to provide a recommendation to the City Commission on how to handle the Affordable Housing Trust Fund allocation associated with a project that is no longer moving forward as originally proposed.”