The Portland City Council on Monday approved the allocation of more than $3.4 million in federal grants for social services, affordable housing and economic development.

But it was the lack of $30,000 in funding for Florence House, which offers specialized housing for homeless women, that drew much of the attention.

“Florence House has saved my life,” said Denise Parhan, who stayed there while waiting for a bed in a drug rehabilitation center so she could kick a heroin addiction. “It has done so much for me. This funding can and will save lives.”

The council ultimately restored the funding, but not before some councilors expressed concern over City Manager Mark Rees’ altering of the funding levels recommended by a special committee.

Rees asked the Community Development Block Grant Allocation Committee to consider rescoring the applications, because a few applicants didn’t check a box saying they met a basic need.

Checking that box meant an additional three points, and once those points were awarded, three other programs that previously didn’t receive funding bumped Florence House out of the budget. City Councilor Edward Suslovic said that change, and others made by Rees, were contrary to the city’s efforts to make CDBG funding more transparent and objective.

“I get nervous frankly when we start to stray from the committee’s recommendations,” Suslovic said. “I am troubled by the process. I hope by next year we can iron out the kinks.”

The council reallocated $30,000 from the city’s Health Care for Homeless clinic, which is closing at the end of the year because it lost a key federal grant. The clinic’s funding was reduced from $51,000 to $21,000.

The remaining funding would keep the clinic open until early October, rather than the end of November, said Douglas Gardner, director of the city’s Department of Health and Human Services.

That funding cut drew the ire of Mayor Michael Brennan, who said it “makes absolutely no sense to me at all” to take funding from one group working with the homeless and give it to another homeless group. Brennan’s alternative proposal to reduce funding for the Wayside soup kitchen and the Amistad Peer Support and Recovery Center received no support from the council.

In other program funding, $400,000 was allocated to CEI for employment training programs for refugees, the homeless and single heads of households.

Also, about $250,000 was approved for a new sidewalk on Elm Street and a pedestrian crossing on Oxford Street. Roughly $210,500 was allocated for additional road improvements in the St. John and Valley streets area, and $110,000 was allocated for a multi-use trail along North Boyd Street.

Not included in the grant spending plan was $75,000 for the HOME team, a homeless outreach service coordinated by the Milestone Foundation.

But Rees proposed using $50,000 from the city’s operating budget to continue the service. An additional $25,000 would need to be raised to restore the funding that previously came from the federal grant.

In other business, the council voted unanimously and without discussion to approve a one-year contract extension for Rees, who was hired in 2011. Both the city and Rees have until April 20, 2015, to inform each other whether they would like to renew the contract.

Rees’ contract requires him to establish permanent residency in Portland. Rees said he fulfills that requirement by renting an apartment in the city. His wife continues to work in Massachusetts and live in the couple’s home in North Andover, where Rees worked before he was hired for the job in Portland.

Rees will make $146,600 for the next year and continue to receive a $450 monthly automobile allowance.

Rees also presented his recommended budget for the fiscal year starting July 1.

Nearly $75.97 million of the total municipal budget of $220.85 million, which doesn’t include school spending, would be funded through property taxes.

That represents a 3.2 percent, or $5.4 million, increase over the current budget.

The proposed budget would increase the property tax rate by 37 cents, or 3.8 percent, which would add $84 to the average homeowner, according to a Rees memo to the council.

The council referred the budget to its Finance Committee for further review.

Randy Billings can be contacted at 791-6346 or at:

rbillings@pressherald.com

Twitter: @randybillings

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Correction: This story was revised at 10:48 a.m., April 9, 2014, to reflect that Portland’s proposed municipal budget for fiscal year 2015 is $220.85 million and the portion supported by property taxes is $75.97 million. An earlier version of this story contained incorrect figures.

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