LEWISTON — The City Council denied a license for the proposed homeless shelter at 104 Park St. on Tuesday, citing a lack of funding and concerns over its location near the downtown business district.

The decision came after the project missed a deadline to receive a $3.7 million grant from MaineHousing, however officials behind the shelter effort said they planned to seek other means of funding if the license was approved.

In a 5-2 vote, councilors said a lack of funding cast doubt on the shelter operators’ ability to meet the requirements of the license they were seeking, while also stating dozens of other concerns tied to previous shelter operations. Councilors Scott Harriman and Stephanie Gelinas were opposed.

The discussion also briefly turned into a tense back and forth over why the application process was delayed, causing it to lose funding.

In making the motion to deny the shelter license, Councilor Lee Clement said now that the state funding isn’t available, the contract between Lewiston Housing and Community Concepts to run the shelter is void.

However, Community Concepts CEO Jim Martin said the organization still intended to partner with Lewiston Housing on the project, and that they would sign another agreement if the project moved ahead.

“How do you meet the performance standards without $3.7 million?” Clement said. “How are you going to pay for all this?”

Referring to the price tag for the project, Clement added, “I’d like to see someone step up and say this is not just throwing taxpayer money down the toilet, and not just a feel-good measure.”

Chris Kilmurry, executive director of Lewiston Housing, said that while he’d have to work to secure an alternative funding source, “we can’t go look for funding without licensure.”

He said the team behind the shelter application has worked hard on the proposal and doesn’t want to provide a “substandard service.”

“We got timed out on the grant, but that doesn’t make the homeless problem go away,” he said.

Prior to the motion to deny the license, several councilors and a Planning Board member said they had major concerns with the location at 104 Park St. The concerns ranged from the potential impact of a shelter in the downtown business district to building issues like electrical panels and ADA compliant bathrooms.

Councilor Bob McCarthy, who said he worked in the former Sun Journal building for years, said he was “shocked when you chose this place. The deferred maintenance is overwhelming.”

Kilmurry said the only reason he proposed the building was because it was the only building that worked under the city’s shelter overlay zone created last year. He said Lewiston Housing purchased the building for it to be used as part of the Choice Neighborhoods project, and that the shelter was only meant as a two-year temporary solution that homeless service providers could build on toward a long-term model.

Planning Board member Josh Nagine said he supports a low-barrier shelter in Lewiston, but not at the proposed location. He suggested the council should “throw out” the shelter overlay zone to allow shelters in more areas of the city, as well as incorporate a downtown business zone that “embraces the Choice Neighborhoods” footprint.

Councilor Linda Scott also argued that the location of the shelter would be detrimental to the city’s efforts to revitalize the area. She said there’s fear among the business community.

“I find it to be a huge dilemma for me. That spot right there, I don’t think it’s going to help,” she said.

Lewiston Housing is also the city’s partner in Choice Neighborhoods, the $30 million federal grant to build new housing and support new neighborhood services.

Councilor Rick LaChapelle said he was concerned with approving a license for a project that “could be on a shoestring budget.” He said if that happened, it could turn into the “catastrophe” like the winter warming center at Calvary United Methodist Church.

“I thank you for trying to do something. I just have grave concerns,” he said. “I think we’re missing the boat.”

Martin defended the winter shelter, stating that Community Concepts was asked by the city in January to open a warming center within two days. He said the need “overwhelmed the building,” but that the effort likely saved a dozen lives during a cold winter stretch.

Scott said when that shelter was in operation, she received calls from neighbors daily, complaining about people rifling through garbage cans and other disruptions.

McCarthy said that followed issues at the former Lewiston Armory shelter.

Kilmurry said he shared a lot of the concerns laid out by councilors.

“We agree it’s not the perfect location, which is why we said it would be a two-year location. At some point, we have to try something,” he said. “I have no idea if I can find the money to move forward, but it won’t change how many homeless people are on the street and how many there will be next winter.”

Councilor Harriman said the council has been “delaying and obstructing dealing with this issue since the term began.”

“People are already there,” he said about unhoused people in the business district. “I don’t see how it can be worse for the neighborhood to have them inside with services, opposed to outside. We have to finally get our butts in gear.”

He also said the council “slow walked” the shelter application, which drew an immediate response from Councilor McCarthy that the city was not to blame.

During the meeting, City Administrator Heather Hunter said the timeline that the city and Lewiston Housing was working toward in getting it to the council by June 6 was presuming the application would be complete.

When it was deemed incomplete by staff, “that’s when things went askew,” she said. “I don’t think placing blame on either organization is justified. I agree this is a new process for both of us.”

Clement said what was being asked Tuesday “is a blind leap of faith.”

“I believe this is dead in the water,” he said. “We’re hashing something around that’s never going to happen in its current form.”

He added that the council, Planning Board and Lewiston Housing should discuss the shelter overlay zone in an upcoming workshop.

On Wednesday, Mayor Carl Sheline said he was disappointed by the result Tuesday.

“The reasons used throughout the meeting by the councilors to deny the shelter application were weak and simply used as cover for their ideological opposition,” he said. “It’s deeply troubling that when given the opportunity to tackle a city challenge head-on, the council instead advocated for an ordinance change. If we have any hope of moving Lewiston forward, both the city and the council need to set aside their fears and biases and come together to make hard decisions.”

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