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Bethe Holland was only in 1st grade then, but she has a vivid memory of the first time she saw the old orphanage that her parents had bought.

”I thought it was disgusting. It was dark and sort of scary. I couldn`t believe they were serious.”

But her parents, Bud and June Holland, were very serious. Family life with their seven children wasn`t developing quite the way they wanted it to in their four-bedroom, L-shaped ranch in a subdivision near Aurora. The closeness they wanted in their big family was eroding. Instead, the kids seemed to be drifting apart, fighting a lot. The Hollands worried about the things all parents worry about: how to instill good values in their children, what to do about peer pressure, about drugs, about alcohol.

So they bought a rundown orphanage in the middle of farmland a few miles north of Dixon, Ill. It had 31 rooms, 9 bathrooms and 26 acres. It was structurally sound–built like a fortress, said a relative who is an architect. But the inside was, quite simply, a mess.

It was a maze of corridors and little rooms. Vacant for two years, the interior had been vandalized. Toilet paper, pop bottles and litter were everywhere. And, as Bethe pointed out, it was gloomy, dark.

That was 12 years ago. Today, the old Peek Home, as the orphanage had been called, is rich with charm, color and practicality. The seven Holland children have grown up with an array of sheep, ducks, cows and ponies on the outside and a fantasy world of cubbyholes, cubicles and hideaway rooms on the inside.

The kitchen is big and modern, and the entire family can sit around the breakfast table. The dining room table seats at least 16, and, with 31 rooms, everyone has his own bedroom. There`s a front parlor for serious gatherings and a family room that has everything from a juke box to a barber chair to an old porch swing, suspended from the ceiling and facing the fireplace.

Several people can simultaneously have a degree of privacy in the bathroom that was once a dormitory bath, and now has a shower, a tub and a toilet each behind its own swinging doors, plus two sinks. There`s even a sauna in the master bedroom`s bathroom.

The transformation was done with a minimum of money and a maximum of effort and creativity.

Bud Holland (his real name is Wayne) is an air traffic controller and certified public accountant and June is an artist. Neither of them knew anything about tearing down walls, building new walls, blowing in insulation, or any of the other things required in gutting and rebuilding a house.

”We knew nothing. But my brother-in-law (the architect) said we could tear down any of the walls except that one center wall. We made a lot of mistakes but we learned,” Bud said.

”It`s like taking the CPA exam: If you think about the whole thing, it`s overwhelming. We never looked at the house as a whole–we`d have never been able to do it. We just did one thing at a time.”

The first night in the new ”home” was one to remember. The grounds around the vacant building were the local lovers` lane, and the arrival of several flashing squad cars in the middle of the night triggered a noisy exodus of the parked cars. Then Bethe got up sometime during the night and promptly got lost in the big house, confirming her fears that this was a major mistake.

One of the first things Bud did after the move was bring home several hammers, all different sizes.

”I told the kids they could pick up a hammer whenever they wanted to, and take out their frustrations on the walls and leave their brothers and sisters alone,” he said.

The first project was the kitchen. Although approximately 30 children had been living in the house when it was an orphanage, the kitchen was small. The Hollands knocked down the wall between the kitchen and dining room to expand the kitchen, built a spacious, walk-through pantry, ripped out the old appliances, built a center island that contained the range and a double sink, put in a double oven, microwave, dishwasher and new cabinets. A second double sink was installed against the wall: ”That had been one of my dreams, to have one sink just for dirty dishes,” June said. ”Do you know how many dishes you go through with seven children?”

Work on the kitchen, some of it done with the aid of a retired carpenter

(”sometimes he`d get upset with what June wanted, and he`d just take off and go fishing,” Bud said) took from September to January. During those months, June was cooking on hotplates in the dining room, the bedroom, the back room, wherever convenient, with one of the bathrooms providing sink space and water supply.

At the same time, the Hollands were tearing down the original, 100-year-old farmhouse that was on their land. From that they salvaged whatever they could to go into the house they were living in.

The oak from the farmhouse went into the walls of the orphanage-house. The gingerbread, or sculptured ”lacy” wood, as June calls it, from the old house became lovely ornamentation for the end of the dining room. The woodwork became frames for the windows in the front parlor. Cedar was used to build a new, angled ceiling in the family room and the 100-year-old, tongue-and-groove wood planks went up on the walls of that big bathroom.

The day the cast-iron tub was carried out of the old house and installed in one of the Hollands` downstairs bathrooms was a red-letter day for June. Until that day, the orphanage`s nine bathrooms had showers only. ”Not having a kitchen was nothing compared to not having a bathtub–it is my pleasure, my great pleasure, to be able to sit and soak in a hot tub,” she said.

If there was any way to use an object, it got used. The old pushbars on the doors of the orphanage were taken off and used as towel bars in the bathrooms. The dividers that had been between all the toilets in the dormitory bathroom were removed, painted and used as wainscoting at the bottom of the dining room wall. They took the upholstery off an old stool they found in the basement and then stripped and stained it, covered it with glass and turned it into a coffee table.

The Hollands went to auctions and flea markets, bought closeout wallpaper, got special deals on carpeting and paint.

Lovely hand-crocheted lace trim on the parlor curtains originally had been trim on pillowcases that June bought at an auction. (The curtain material itself was a bargain, at $1 for five yards.) An 1859 Steinway piano was bought at an auction. A barber chair that the kids could pump up and down was bought from a 70-year-old man who was getting a divorce.

They bought pews and an altar from a church that was being remodeled. The pews became the seats around the 14-foot-long dining room table that Bud built; the altar was cut down and made into the family room`s coffee table.

”We had the good padre take the blessing off the altar so we could play poker on it,” Bud said.

In the middle of the chaos, while they were working on the front parlor, June came home one day to find that Bud had taken the green paint and drawn a big heart over the fireplace. ”Bud and June” was painted inside the heart, and outside, the message, ”I love you. XXXXX.”

Bethe, the 1st grader with all the misgivings about the move, is a senior in high school now. Her oldest brother, David, 23, is finishing his Ph.D.;

Rocky, 22, just graduated from the Air Force Academy; and John, 20, is a junior at the University of Illinois. Bethe`s older sister, Jeannette, 19, is a sophomore at Northern Illinois University in DeKalb. The two younger ones, Jimmy, 14, and Marian, 13, are in 8th and 7th grades.

Add June to the list of those in college. She is also a student at Northern Illinois University, with a major in painting and interior design.

It was a lot of hard work, with a few tense moments (”I came home one day and couldn`t believe it–June had started knocking down the one wall we had been told not to touch,” Bud said. ”I knew I could knock down that part of it, I just had to do it while you weren`t here,” she responded). And there were a lot of laughs.

It did build family values and closeness, they believe. ”I think after we moved here, the kids started pulling together,” June said. ”They were creating, building something here.”

In recent weeks, the outside air has been fragrant with the smell of clover, lilac and apple blossoms.

Apple blossoms on the outside and a lot of color, charm and ingenuity on the inside.

”We`ve never had a lot of excess money,” Bud said. ”But you don`t need a lot of money to do something successfully or to have good friends. This place has worked for us.”