The City of Portland and Maine taxpayers will be footing a nearly $4.5 million annual bill for operating a 179-bed shelter for single asylum-seeking migrants after the nonprofit organization that was contracted to take over services at the shelter dropped out due to lack of funding.

The migrant shelter, located at 166 Riverside Industrial Parkway and owned by Developers Collaborative (DC) Blueberry LLC and DC Management LLC, was funded by a $4.59 million grant from the Maine State Housing Authority and opened in November 2023.

Under the city’s original contract to build the shelter, city staff were to be the primary service provider at 166 Riverside for a period of 18 months, while being shadowed by staff from Maine Immigrants’ Rights Coalition (MIRC), a nonprofit representing a network of immigrant advocacy nonprofits in Maine.

After 18 months, MIRC staff were supposed to take over and provide meals, staffing and other support services at the shelter for the remainder of the three-year contract.

It was revealed in a memo to the Portland City Council last week that the Council would have to consider removing MIRC as a party to the shelter contract “due to [MIRC’s] inability to secure sufficient funding to continue providing services.”

At Monday’s City Council meeting, Portland City Manager Danielle West provided more details on the exact cost the city will now be taking on, with the nonprofit dropping out of the contract.

West said that the total annual cost to the city to operate the shelter would be $3.27 million, a cost mostly made up of payroll expenses for the 45 full-time city employees that will be staffing the migrant shelter.

In addition to that $3.27 million operating cost, the city will now also be responsible for paying for the meals at the shelter following MIRC dropping out of the contract—a cost of $1.2 million per year, for a total of about $4.5 million annually.

West did not provide much insight into why MIRC was unable to meet the terms of the original contract, merely commenting that in conversations with the nonprofit it became evident that “ultimately, due to a variety of circumstances it wasn’t going to work out.”

Earlier reports indicated that MIRC was unable to reach its promised fundraising goals.

The order to remove MIRC as a party to the contract was passed by the Council unanimously.

The City Manager said that 70 percent of the shelter operating cost will be reimbursed by the state through General Assistance, meaning that taxpayers throughout the State of Maine will also be saddled with the cost of Portland housing and feeding noncitizen migrants at the shelter.