Despite uncertainty over funding, Palo Alto is continuing to refine its plan to build a transitional-housing complex on San Antonio Road that will provide 88 homes and support services for unhoused families and individuals.

The proposal, which is being jointly undertaken by the city and the nonprofit LifeMoves, calls for building the shelter at 1237 San Antonio Road, a city-owned site that is currently used by GreenWaste for sorting deconstruction debris. On Tuesday, the City Council reaffirmed its support for the project and voted unanimously to revise the design, turning the project from a two-story complex to a three-story one.

The fate of the proposal, however, remains uncertain. The city has still not received the Project Homekey grant that it was hoping for to make the project possible. The grant program, which is administered by the state Department of Housing and Community development, distributed $1.2 billion in funding to dozens of projects as of June 1, including rehabilitations of hotels in Mountain View and Redwood City to serve unhoused residents.

But even though Palo Alto has yet to receive the $27 million that it is banking on to make the project possible, city officials remain undeterred. Deputy City Manager Chantal Gaines said Tuesday that the city expects the state agency to announce more Homekey grants in July and the city is hoping to make that list.

LifeMoves, which last year built a transitional housing complex in Mountain View, also reaffirmed on Tuesday its commitment to build the 88-unit shelter in Palo Alto.

"This will be the first overnight transitional shelter in Palo Alto," Aubrey Merriman, CEO of LifeMoves, told the council Tuesday. "And for us it's just going to be a shining example of the extension of the work that the city has embarked upon."

The project now envisioned is somewhat different from what the council approved last December. Under the new design, the LifeMoves project would no longer share a driveway with GreenWaste. And what was formerly a two-story complex with a height of 25 feet, 6 inches, will now be a three-story building with a height of just over 38 feet. The project would still feature 88 units, 24 for families and 64 for single individuals.

Joanne Price, vice president for real estate at LifeMoves, told the council that the new design would allow LifeMoves to use the site more efficiently. The complex, she said, would have "fewer building footprints, fewer foundations and a lot more open space for the clients who will be staying there."

"It will create more of a community," Price said.

Council members swiftly approved the design change. Council member Alison Cormack said the new design would benefit both the residents of the new complex and GreenWaste. Council member Greer Stone agreed and noted that a major benefit of the revised design is that residents will no longer have to share a driveway with GreenWaste. He called the new design a "win-win."

"It's not enough to create affordable housing, we need to create housing with dignity," Stone said. "And I don't imagine us creating another affordable project that would basically be in the driveway of trash pickup and collection."

As the city awaits word of state funding, LifeMoves is advancing through the city's planning process. In April, the nonprofit filed applications to relocate the GreenWaste operation to accommodate the housing project and to request an architectural review for its new development. A report from the City Manager's Office notes that the facility will accommodate stays between 90 and 120 days and no more than 180 days. It will be an assembly of modular units and it will incorporate solar panels on the roofs.

"The modular units include the shelter units, as well as support structures for programming, case management, storage, and LifeMoves offices," the report states "The project also includes two site-built structures for additional communal space and dining facilities, and site-built elevator control rooms."

Mayor Pat Burt called the latest revision "a good advancement on the design and a really valuable project." But he and council member Tom DuBois each noted that the city will still need to find funding sources to operate the facility once it's constructed.

"I know we're all struggling to come up with a way to be able to have the sustainable funding for the operations and we'll be partnering with LifeMoves to attempt to come up with the longer-term solutions yet for that need," Burt said.