A Lexington day shelter and a controversial Winchester Road night shelter for the homeless will move to a city-owned building on Industry Road as part of a settlement approved by the Urban County Council on Thursday night.
The agreement will end more than three years of litigation between the city, the homeless shelter and fair housing advocates. The deal also could halt a U.S. Department of Justice investigation into alleged fair housing violations by the city.
The council voted 12-3 to approve the deal after hearing from its supporters and several Industry Road business owners who opposed it.
As part of the agreement, the city will transfer ownership of a building at 1055 Industry Road — formerly the mayor's training center — to Divine Providence, which oversees Community Inn, a night shelter, and the Catholic Action Center, a day shelter on Winchester Road.
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Divine Providence will give the city $550,000 for the building and transfer ownership of the Catholic Action Center on Fifth Street to the city. The Community Inn and Catholic Action Center will move into the building on Industry Road as part of the agreement.
Ginny Ramsey, co-founder of Divine Providence, said the homeless population the two shelters serve finally will not have to walk miles from the day shelter to the night shelter to Divine Providence's clothing bank off Loudon Avenue.
Ramsey said it's unlikely the shelters will be able to move until spring because the building has to be remodeled.
Some business owners told the council Thursday they were concerned that their new neighbors might scare away customers on the road behind Eastland Shopping Center.
Martine and Jim Holzman own Martine's Pastries on Industry Road. Although they are longtime supporters of the Catholic Action Center, Jim Holzman said he was concerned that customers might steer clear of the popular pastry shop. "Our concern is with perception," he said. "If the public perceives that it is dangerous, they won't come."
However, Ramsey said people will not be waiting outside because the shelter will always be open. Plans call for a courtyard at the back of the property that will not be visible from the street.
Council members Bill Farmer, Angela Evans and Jennifer Scutchfield voted against the settlement agreement. Evans tried to delay the vote until October. But Janet Graham, the city's law commissioner, said the delay could derail the settlement.
The Lexington Fair Housing Council, a nonprofit, filed a complaint with the U.S. Department of Housing and Urban Development in September 2012 after a conditional-use permit for the Community Inn was revoked by the Board of Adjustment.
The city said a church had applied for the permit but did not say it was going to open a homeless shelter. Community Inn countered that the shelter was part of the church's mission.
The complaint alleges that because so many homeless people are minorities and are protected under federal fair-housing laws, the permit revocation violated federal law.
HUD amended that complaint to include the city's passage of a day-shelter ordinance in October 2013. The ordinance required a special permit for any organization operating during daylight hours if it served people with "limited financial resources, including people who are homeless."
The council later changed the ordinance so it would allow day shelters in most business zones without special permission.
In March, HUD turned over the investigation to the U.S. Department of Justice. Graham said Friday that the parties would ask federal investigators to drop the fair housing investigation. The city and Divine Providence have been in litigation over the revocation of The Community Inn's conditional-use permit. Those cases will be dropped as part of the settlement.