The owner of a shuttered east-side motel has offered to donate his property to Good News Ministries, which hopes to turn it into a shelter and transitional housing for homeless families.

The offer, which came out of the blue last year, at first seemed like the perfect windfall for Good News. The rescue mission has operated a homeless men's shelter at Washington and Rural streets since the 1980s, and it's looking to serve more of the growing population of homeless families.

“There are so many families living on the edge in our society,” Executive Director Dan Evans said. Six shelters that already serve couples with children, or just women and children, are at-capacity every night, according to the Coalition for Homelessness Intervention and Prevention.

Evans soon realized, however, that the potential donation comes with a lot of baggage. The Indy East Motel, 5855 E. Washington St., was a crime magnet when the city revoked its business license in 2006. The business finally closed in early 2009, and neighbors hoped to see a redevelopment in keeping with plans for a $2.5 million streetscape improvement.

Irvington is a historic district, so any variances and a change in zoning for the new use as a shelter must first be approved by the city's Historic Preservation Commission. Knowing the commission takes its cues from the neighborhood, Evans said he won't accept the real estate unless the Irvington Community Council endorses his plan.

Nayan "Nick" Patel said his grandfather, Jeram Gandhi, the owner of Indy East,  decided he wanted to give the property to Good News. Patel was familiar with the organization because of its highly visible east-side location. He toured the Good News operation and was happy with what he saw. "We did a lot of research," he said.

A group of clergy from Irvington-based churches has signed a letter of support for the Good News family shelter, but so far most residents seem against it, said Jonathan Katz, an Irvingtonian who is leading a sub-committee on the proposal.

Katz said he's been deluged with questions and objections. Many of the objections stem from misinformation, he said, but there are lingering questions. One is whether Good News would succeed in raising $1.1 million for the renovation, or $350,000 for ongoing operations.

“There’s no written formal proposal,” Katz said. “There’s no balance sheet. There’s no business plan.”

Another question is whether a commercial developer would buy the property instead. Amandula Henry, executive director of the Irvington Development Organization, said her organization hasn’t done a formal study of the site, but believes there’s potential for other uses.

Evans said he's not sure how long the owner will hold out the offer. He hopes to see a decision from the neighborhood group by November, but it could come as late as January.

Despite the demand for beds at family and women's shelters, CHIP decided to back Good News only after it revised the plan to add 10 apartments where families can stay three months to two years with access to support services.

“Generally, the answer to ending homelessness in Indianapolis and anywhere else is not to increase shelter capacity,” said Michael Hurst, program director at CHIP. “The goal is to get people into affordable housing.”

There are roughly 430 transitional-housing units in the city, according to CHIP, so the Good News plan would add about 2 percent.

Good News plans to renovate 31 motel rooms to serve as emergency space for married couples or single parents with children. The six shelters that accept children have a combined 360 beds. The additional rooms would increase shelter capacity more than 8 percent.

Hurst acknowledged that if more emergency space were available now, it would be put to use. Family shelters, which notify CHIP about available beds, reach capacity every afternoon, he said. Since the recession and foreclosure crisis, traditional families—mom, dad and kids—are a more common sight at shelters, he said.

HIP's annual survey of the homeless population, conducted on a single night each January, found 213 families in 2009, a huge increase from 120 in 2008. This year, the number of families in the January count declined to 199, but Hurst predicts it will rise again. Agencies that can prevent homelessness are maxed-out, he said. “I'm worried about tears in the net this year.”

Founded in 1950, Good News Ministries owns a substantial complex at Washington and Rural streets, where it runs not only a men's shelter, but youth center, thrift store, health clinic and transitional apartments for families. For the year ended Sept. 30, 2009, Good News reported expenses of $1.56 million and revenue of $1.67 million.

Evans, who has worked at Good News since 1991, said there hasn't been a significant fund-raising campaign since adding the youth center and clinic in 2000, but he's getting positive feedback from supporters. The bulk of the rescue mission's support comes from Baptist churches, followed by Presbyterian and other denominations.

Good News noted in its 2009 Internal Revenue Service filing that its shelter housed an average 92 men a night, and 58 had “received Christ.” The men are required to attend church, and they receive counseling.

“We’re a Christian ministry,” Evans said. “The basis for everything we do is the Bible. We want to see everybody come to Jesus Christ.”