Velma Jones celebrated her birthday on Saturday by moving into her newly renovated house in Arlington's Nauck neighborhood with eight of her 12 children.

A new bathroom had been installed in the basement, walls had been patched and painted and old fixtures had been replaced in the kitchen and bathroom with a $43,000 combined loan and grant Jones received from the Arlington Housing Corp.

"I'm very happy with the improvements," Jones said. "My kids are so excited. It's like a new toy to them."

For the past 15 years, the housing organization has helped more than 1,000 low- and moderate-income families renovate or buy houses in Arlington. The organization offers renovation loans and grants of up to $40,000 through its Home Improvement Program.

"The civic association and {the housing organization} have developed a partnership that's enabled people to get their homes renovated and try to help families stay in the community," said Jennie T. Davis, Nauck civic association president and a housing organization founder. "Our aim has been to preserve the housing we have here and to build moderate housing in the area."

The civic association refers families to the organization to help them meet their housing needs. Housing organization staff members periodically attend neighborhood civic association meetings to inform residents about available programs.

"It's great to know that another family is going to stay warm and dry for the holidays," said Lou Ann Frederick, the housing organization's executive director. "We aim for 2,000 units by the year 2000."

The program includes low-interest improvement loans based on income, including furnace replacement and roof repair. Many of the housing organization's clients are retirees living on fixed budgets who cannot otherwise afford hefty repair and maintenance bills.

A Barrier-Free Program also is available to physically disabled, income-eligible homeowners and renters in the county. Wheelchair ramps and tub grab bars, for example, can be installed for improved mobility.

"Construction and development is generally a very money-oriented, bottom-line business," said Gordon Ferris, the organization's director of single family programs. "There's no other place for low-income people to go to fix up their homes."

Home ownership is available through the Moderate Income Homeowner Program. About two houses a year are bought, renovated and sold to first-time buyers.

A Moderate Income Purchase Assistance Program is offered to first-time house buyers in Nauck, Columbia Heights West and High View Park, designated by the county as target areas.

Houses valued at $120,000 or less are eligible for the program. The housing organization lends buyers money for the down payment and closing costs. Payment on the loan is due only after the house is sold.

The organization also builds modular town houses for first-time buyers. The $120,000 town houses are built in about 90 days and cost the organization $80,000, not including land and closing costs.

The organization also renovates apartment complexes and currently oversees 764 apartments.

Each apartment property sponsored by the organization is owned and monitored by an affiliate corporation with a volunteer board of directors, including residents.

County Board member James B. Hunter (D) was one of the organization's founders and served as its first president. In 1975, he and other volunteers formed a nonprofit, private corporation to preserve Arlington's moderately priced housing.

"There was heightened concern of what condominium conversion was doing to the housing stock for low- to moderate-income people in Arlington," Hunter said.

The first year, the organization had one paid staff member, working three-fourths of a week, and $40,000 in funding. A board of directors composed of neighbors, financiers, property owners and members of public interest groups was formed.

"There is a broad spectrum of members, not just community do-gooders, so to speak, coming up with good ideas that can be implemented," Hunter said.

Today, the organization has 15 full-time and two volunteer part-time staff members, a $700,000 operating budget and more than 500 members.

A $450,000 loan and grant fund is being developed to use as seed money for preliminary work such as research, appraisals and land purchase.

"Some people would say, 'Who needs affordable housing in Arlington?' " said John Spencer, the housing organization's director of multi-family programs. "Arlington would survive, but the diversity with the different ethnic groups would disappear."