When newcomers arrive at Rose Hill, they cower. They hide behind their parents and try to shrink away, like kindergartners. They are adults, but they are hurting, and they are afraid.

"Welcome to Rose Hill," John Kelly says to them, and the very sight of him is a balm to the shaken souls who have come in search of a place to heal.

John Kelly is 31. He's tall and strong and smiling. He is a paranoid schizophrenic. That's his burden. He carries it cheerfully, resolutely - as if it were a bale of hay for the cows he loves so much, the ones roaming out there right now on Rose Hill's 372 pastoral acres.

The people who come here to live along-side him for a time - most will stay no longer than six months - have just emerged from mental hospitals. Their horrors are fresh - the haunting delusions, the riotous mood swings, the loss of control. The worst is past, but their lives have been upended. They are changed.

They can see right off that John is one of them. And he is doing just fine.

"Do you know," John says to the newcomers, as they walk through Rose Hill's pretty new buildings for the first time, or take a gander inside the barn, "that they built this whole place for me?"

He is right. There would be no Rose Hill, no haven, without John. Everyone who comes here has a story, but his had to unfold first.

"The lights! The lights are wired," John Kelly cried. "The FBI is watching us, and we have to be careful."

Rosemary Kelly looked up with a start and felt a cold claw grab her heart and squeeze.

It was an evening in November 1986. Her son had been acting a little strangely all this week. A few of his comments had seemed out-of-the-blue. And he had been unusually worried about Rosemary, still recovering from an auto accident several months earlier. The smallest incident - a spoon clattering to the floor - would bring him scurrying to her side: "Are you OK? Are you sure you're OK?"

Now, once again, Rosemary tried to assure herself that nothing was seriously wrong.

"You're just tired, John," the small blond woman told her strapping son. John Kelly had just come in from his daily run. He was dripping sweat and red in the face. "You're tired. Go on upstairs, freshen up, and watch a little TV."

John was the third of Rosemary and Dan Kelly's four children.

All four were grown now. Mary Jo was married, with two babies, and working as a nurse in Cincinnati. Patty was married too, working downtown in the financial department of Harper Grace Hospitals and expecting her first child. And Theresa was in college, bright and ambitious, ready to soar. They were beautiful girls. Smart. Pretty. The sort whose upward trajectory seemed pre-ordained.

John's flight plan had taken him on a radically different course. A post-circumcision infection had nearly killed him as a newborn. A new strain of penicillin saved his life, but by the time he was 2, doctors had confirmed brain damage.

Rosemary Kelly wept alone in the deserted pews at St. Bede's Church when she heard the news. "Mentally retarded," the first physician told her bluntly. "A slow learner," the experts at Children's Hospital said later, softening the blow, but not erasing the previous verdict.

From the start, John had been the discordant note in Rosemary Kelly's world of wealth, privilege and perfect children.

For the most part, she and her husband, Dan, melded seamlessly into the community of successful white-collar Catholics. If anything, they were more successful that most - Dan a rising star at the Big Eight accounting firm of Touche Ross, Rosemary an unusually devoted and energetic mom.

When all the ladies came over for tea and chattered brightly over their sons' PhDs and their nephews' scholarships to Notre Dame, Rosemary Kelly played the perfect hostess. But sometimes she'd shake a fist after they left and shout across the empty teacups: "Don't you know anybody who ever got a C?"

This night in November, Rosemary tried to focus on her son's successes. He'd made it through Catholic military school with a little special attention from the nuns. He loved sports and wasn't half bad at a few; his sisters spent hours practicing with him out on the lawn.

He had a high school diploma, and achievement in which mother and son took equal pride. The day he graduated from the Shrine of the Little Flower High, they ran together down Woodward Avenue in celebration; they'd studied hard every night for four years to get to that day.

He'd held a clerical job since then. He drove a car, a special gift from his dad. He was doing remarkably well, under the circumstances. Everybody - even the neighbors with sons in medicine and business - said so.

But now he was back downstairs, spewing nonsense. "Mom," he said, "Bill Bonds just told me we have to watch out!"

Rosemary told her son to go back upstairs and rest, and went to bed to wait for Dan, the steady man she'd known since grade school, to get home from his downtown Detroit office. Dan would calm them both down, banish Rosemary's anxiety.

But later that night, after he had checked on his son, Dan Kelly's face was white with shock.

"What is going on here?" he asked in an urgent, hushed voice. "Rosie, what in the world has happened to John?"

They took John to William Beaumont Hospital that first night, where he grew increasingly remote and frightened. He stopped talking about people being after him, then stopped talking at all.

He refused to eat or drink, and passed his days sitting motionless on the bed, wearing a hospital gown. If Dan or Rosemary came to visit, John would cringe and back away as far as he could, then become motionless again.

The look in his eyes was dead.

"What in the world is wrong?" Dan beseeched his son's doctors. They had no answer, except to say John was now catatonic.

"He was what I would call a zero," Dan recalls. "He was just not there. He was afraid of everybody. But he didn't even know who they were.

"He didn't even know," Dan says, a little choke in his voice, "that I was his father."

John had always adored his dad. Dan Kelly, by now chairman of Touche Ross, was also the undisputed CEO of the Kelly family. At home or at work, he confronted crises squarely, made the difficult calls, moved forward. John had always leaned on him.

But suddenly John was lost and confused. And so was Dan. Nobody in his family or Rosemary's had ever suffered anything like this. For the first time since John's birth, he felt helpless.

John's chest and face turned a blotchy crimson with thrush infection, but he continued to refuse food. While hospital administrators sought a court order to administer food and antibiotics intravenously, Rosemary worked on her own solution.

Her son had loved the taste on ice since he was a toddler. She went to the hospital cafeteria, put ice in a cup, then sat across from John rattling the cup for hours.

"I'm not going to bother you, John," she'd say in a soft voice. "Just come over here, and take a drink. You need a drink so badly."

Days passed. No response.

Rosemary went on shaking the ice. Then one day, when John had been in the hospital nearly three months, he took a step toward his mother. "It's OK, John. I won't bother you. Just take a sip," she crooned.

Dan came, and they coaxed and wheedled and gently kept after John, until he came close. He sipped.

Then, ever so slowly, Dan removed John's gown, stripped off his own clothes and gave his son a shower, the first one in weeks.

As John began to emerge from the catatonia, Dan and Rosemary were exasperated to find that their local doctors couldn't tell them where to take him for treatment. Dan swung into action: He called all the hospital board members he knew in New York City, where his company was headquartered, and finally came up with a long-term mental hospital in nearby Hartford, Conn.: the Institute of Living.

Another family might have retreated from the Institute's fee - $500 to $700 per day - or failed to survive its scrutiny of their person finances. Later, Dan and Rosemary would meet parents who had been ruined financially by their children's mental illness. That was one thing the Kelly's didn't have to worry about.

But all the Kelly's money bought was admission to the new and baffling world of paranoid schizophrenia - the diagnosis John was given by his new medical caretakers.

"The looney tune farm," the cab driver had nodded on the drive from the airport to the Institute. Well, Rosemary thought to herself, Yes. That's where I'm headed.

At the institute, the doctor's explained to Rosemary and Dan how their son's brain had been assaulted for the second time in his life. His chemistry had gone awry, they said, for some unknown reason. The stress on the family after Rosemary's car accident might have triggered John's break; it was not the cause.

The delusions and hallucinations characteristic of schizophrenia were not connected to John's learning problems, the Kelly's were told; the disease could strike anyone, and does. In fact, one out of every 100 persons in this country will develop the disorders in their lifetime - an estimated 3 million people in the same boat as their son.

About a third of all schizophrenics require round-the-clock care for the rest of their lives, the doctors said. Some of these people were living at the Institute. When Rosemary would take John for a walk, she'd run into them. "The French army is coming," a man called out to her one day as they went by.

Another third fully recover, or nearly so - and can return to their jobs and families. The rest can function reasonably well - with some diminished capacities - provided they take daily medication.

The Kellys told themselves they had reason to hope.

In his first months in Hartford, John remained walled inside himself. The Institute doctors came up with an idea for kicking his brain chemistry into gear: electroshock therapy. Again, court permission would be needed, because John was an adult, but not capable of acting for himself.

Dan couldn't be there to deal with this problem. Secretary of the Treasury James Baker asked him to join a delegation of businesspeople seeking to smooth trade relations with Saudi Arabia; he really had to go.

"It was up to me," Rosemary knew. After daily, painful therapy, her own body was nearly back in shape; she had to handle this job.

She saw the judge, signed the papers. She tried not to look worried when the nurses came every day for John, tried not to cry when he came back, quiet and drawn.

Every day for a couple of weeks, he'd look at her, confusion and hurt in his eyes. "It's scary," he said. Rosemary kept telling him it was going to help, although she wasn't sure herself exactly how.

Later, she would wish she hadn't allowed it. "I think it made John slower," Rosemary says now. "I don't think it did help - but what could we do then? At that time, we just figured we better go along with the doctors."

But Dan Kelly had not scaled the corporate heights by being deferential to others. As John's stay wore on, Dan pressed his son's doctors for a game plan, a next step.

The Institute's physicians said John had reached a plateau, and counseled running in place. We think, they told Dan, you should leave him here.

Dan thought about the $700 per day. He thought about the plateau. A picture flashed in his mind: A wizened John, gray and wrinkled, his parents long dead, still living in his little hospital room and taking aerobics and talking to his therapist on Tuesdays and Thursdays.

"Not an option," he said.

He pressed for alternatives. There had to be a place where they taught people like John to live outside the hospital. "He can do better than this. I know it," Dan insisted. "Don't you know of anyplace?"

Finally, a doctor at the Institute remembered a place called Gould Farm.

It was literally a farm, he told Dan, founded early this century by Will and Agnes Gould. They were a childless couple whose lives had been inspired by the words of Jesus - "Whatever you did for one of the least of these brothers of mine, you did for me."

Located in Berkshire mountains of Massachusetts, about an hour's drive from Hartford, Gould Farm accepted some severely mentally ill persons whose symptoms had been stabilized by medication - as John's had - to live and work on the farm.

There was not treatment of patients in the usual sense, the doctor explained; the idea was to rehabilitate the mentally ill in a low-stress setting, for a return to normal life - or as close to normal as possible.

"And you've never been there?" Dan Kelly asked incredulously.

Dan Kelly drove to the Berkshires the next morning. John moved to Gould Farm the following month.

John took to farming as a cow takes to grazing and swatting flies, as a rooster takes to strutting in the yard.

Farm life seemed perfect for him; it offered structure, purpose, exercise and the company of animals - especially cows, who struck John as the most congenial of companions.

John made friends among the other mentally ill residents, and was instantly fond of the staff, who live at Gould Farm, too. Slowly, he regained self-sufficiency. He set an alarm clock, dressed himself in the morning, started paying attention to his table manners again.

Occasionally, the disorder that will never leave him would reassert itself, and suddenly John would hear the animals talking to him. Selma, the pig, and sometimes even his beloved cows, had frightening messages to disrupt his day.

The doctors who watched over Gould Farm's farmers would adjust John's medication - or try a new one. Sometimes the side effects irritated John; he hated it when his face broke out; he really hated it when he drooled.

But, Dan and Rosemary would say when they visited or talked on the phone, "We know those things are hard to bear, but think of it, John! You're so much better."

But what was the next step? Dan Kelly, the strategic planner, needed to know.

John's first year at Gould Farm was nearly up. He might never be self-sufficient enough to move into the apartments Gould maintained in Boston for residents ready to move to a less supervised environment. Besides, Rosemary wanted her son to live somewhere closer to home, so he could visit on weekends and easily join the extended family for summer trips to northern Michigan.

She and Dan looked at a few group homes for the mentally ill in Michigan, but what they saw appalled them. "Nobody was getting abused, exactly," Dan Kelly says. "But these were not the kind of places you'd want for your son."

At many facilities, residents sat around all day and watched television or smoked. At one place, they walked the neighborhood streets aimlessly, without purpose or supervision.

Then, one weekend as Rosemary and Dan drove home to Michigan from Gould Farm, it struck them: "What we really need to do," one of them said - neither remembers who articulated it first - "is to build something like Gould Farm in the Midwest!"

First, they called every prominent doctor they could think of, and Tom Watkins - then state director of mental health.

Yes, the state would participate. Michigan was paying $200 a day to care for patients like John at state hospitals; the center the Kellys envisioned would cost about half as much. The Blanchard administration committed $250,000 to the $5 million it would take to build a facility housing 48 residents.

Dan and Rosemary gave $200,000 themselves. The charitable trust from John's old employer, R.L. Polk, did the same. And the Kresge Foundation produced a challenge grant of a half million dollars.

Finally, Dan Kelly felt liberated from the caution of physicians and hospital administrators. He was back in the realm of logistics, of making things happen. He was dealing with businesspeople now, and there weren't many businesspeople in Michigan who wouldn't take a call from Dan Kelly.

He found a perfect piece of property two miles north of Holly - with gently rolling fields, forests, and lakes. Mud Lake, one of the bodies of water was called. One day when he was walking the place where John's new home would be built, Dan rechristened it Lake Hope.

For only $6,000 Michigan State University's agriculture department assigned an intern to develop the farm, helped lay out the sewage system, and cleaned up a polluted pond.

Architects came on board and designed simple rooms with lovely outdoor views for the residents, airy and efficient apartments for the live-in staff, inviting public rooms with fireplaces and arched windows.

As planning intensified, town officials in Holly began talking anxiously about an invasion of troubled mental patients. But Dan Kelly would not be derailed now. Another developer might have submitted testimonials from Gould Farm administrators; Kelly simply flew the town board to the Berkshires to see for themselves. It worked better than a tranquilizer.

Virgil Stucker, an administrator at Gould, agreed to become director of the new facility. He and the Kellys and a few others brainstormed about a name for the new place.

Something warm, something traditional like the titles of family country estates the Kellys had noticed on trips to England. And so was born Rose Hill; Dan especially liked how it employed part of Rosemary's first name.

As a growing army laid pipes and superstructure, Dan kept beating the hushes for contributors, delivering a cost-benefit analysis of Rose Hill's services and throwing in his layman's description of what would go on there:

"Look, there's no rocket scientist involved here," he would say. "We're just going to help people learn how to live again - get up in the morning and brush their teeth, go to work in the barn or the wood shop or the kitchen, and do something worthwhile. And feel worth-while again."

Blue Cross/Blue Shield co-sponsored a big fund-raising affair at the Pontiac Silverdome. More contributors, large and small, jumped aboard: Michigan Bell, the UPS foundation, Roman Catholic organizations such as the Order of Malta. Little Caesars pizza czar Mike Ilitch gave $50,000, and promised to find jobs at his restaurants for every Rose Hill graduate who needed one.

One night at about 11, Dan was working at his desk at home in Bloomfield Hills, and the doorbell rang. It was car dealer Martin J. (Hoot) McInerney, who had strolled over from the construction site of a house he was building nearby. "I've been meaning to give you this," McInerney said, and handed Dan a check for $25,000.

Meanwhile, Rosemary Kelly, who'd never been one to take center stage, began making a career of speaking from the heart. She'd stand up at meetings and talk about John and Rose Hill and her family's uphill climb, and let her tears flow as they came.

Afterwards, she'd be mobbed by people who wanted to talk about a cousin, or a neighbor, or a friend who had a mentally ill relative; often, Rosemary knew, the disease was closer to home than that; stigma and shame still kept people in the shadows, she saw, but she was never going back there.

John counts out the silverware, lays out the napkins, and carries the steaming spaghetti to the table. He is smiling big and joshing with the two staff members who live in the little white house in a corner of Rose Hill with him.

John is in his glory; it is community dinner night at his place, the highlight of the week. "I like to greet the people, and then we all eat our dinner and talk," he says. "Sometimes, we play the piano and sing."

When the population grows at Rose Hill, community dinners will take place every night in the big dining hall. The tradition has already been established, though, with this smaller group.

John has been living here a year. First it was just him and the Virgil Stucker family, and a few other staff members as construction went on. Now the first residents have arrived: two men and two women. One is 41; the others, like John, are in their early 30s.

"It has been a nice year," says John, downing his spaghetti. "I got to work on the farm, and learn all the jobs."

Dan has receded now, the laser beam of his energy focused again on the merged firm of Deloitte & Touche, where he is a vice-chairman based in Detroit.

John keeps his father's picture in a silver frame on the small wooden bureau in his bedroom, and talks to him often on the phone. Dan tells John how busy he is, and about the next trip he has to take. John tells Dan about the cows, especially his favorite - the one he calls Itchy - and Lady, the horse that bucked him, and the 23 lambs sired by George the ram this spring.

But it is Rosemary, the chief operating officer of the Kelly family, who has moved to the fore of Rose Hill. It is she who has watched over the builders, checked out every detail of the structure's interiors, picked the paint, haggled over the price of the Venetian blinds, enlisted her oldest daughter to sew up the curtains.

In some ways, Rosemary's life has changed as dramatically as her son's. There is less time in her life now, and more purpose. "This is what makes sense to us now," she says simply. "Dan and I will spend the rest of our lives helping people, whatever we can do."

Every morning and afternoon, John feeds the animals and does his chores at the barn. Last winter, he cut wood from the Rose Hill forests for the Rose Hill fireplaces; this winter other residents will swing axes alongside him.

John takes a new type of medication twice a day. This, too, has become an accepted, unquestioned part of his routine. There will be classes for the residents of Rose Hill to help them understand what their medications are for, and why they need to take them, despite nagging side effects. John already knows: "The pills help me not to get sick. I don't want to get sick."

This year, he's had two "paranoid blips," as Rosemary calls them. Once he heard the cows talking; another time, he grew desperately fearful for the Rose Hill director's children as he walked with them in the crowded streets at the Ann Arbor Art Festival. The new medicine, though, seems to have banished such moments from his life.

He has had a sad realization.

On last summer's family trip up north, he was walking with his family back to the house from the beach one day. John's nieces and nephews were hopping and skipping ahead. His sisters and their husbands were running after. John and Rosemary lagged, pulling wagons loaded with toys.

"I guess I'll never have a wife and some children," John said to Rosemary, and hung his head. Her eyes brimmed over. "Maybe not," she said, "but that doesn't mean you can't have a good life."

She believes it. So does Dan.

So does John.