Things seem to be on the right track for Nickelsville: After two years of nomadic living in empty lot after empty lot, the city has agreed to pilot a project that will permanently place the 100-person homeless encampment on city land in Sodo. While that site is being outfitted with an office and concrete foundation—a process expected to take until next March—city officials are housing Nickelsville at former Fire Station 39 in Lake City through what forecasters expect to be a snowy winter.

Nickelsville was named after former mayor Greg Nickels, whom many perceived as ignoring the needs of the city's homeless population­—Mayor Mike McGinn is taking a different tack. His office has pushed to affix the homeless camp in a Seattle neighborhood (never a popular idea with neighbors) and provide on-site access to help transitioning to permanent housing. And even though the mayor has neighborhood critics and skeptics on the Seattle City Council—who have unresolved questions about paying for this permanent site—homeless advocates are overjoyed with his ambition.

"This mayor has gone further than any previous mayor has in supporting Nickelsville, and we thank him for that," says Amy Hagopian, a professor at the University of Washington's School of Public Health. "His staff has worked incredibly hard to find a suitable site."

But by taking it on, the buck now stops with McGinn.

And skeptics have some serious gripes. Some are easier to overcome (or ignore) than others: Sodo business leaders have made a watery argument that the Sunny Jim peanut butter factory, where Nickelsville will eventually take up permanent residence, isn't good enough for the homeless group; council president Richard Conlin says people shouldn't live in tents and suggests that there's enough wealth to provide them housing; and residents in Lake City and Georgetown (the soon-to-be neighbors of Nickelsville) complain that the mayor's office has done little to no outreach informing them about the encampment.

"We are facing a significant need right now," says Aaron Pickus, spokesman for the mayor, noting that there were 1,986 unsheltered people documented during Seattle's one-night homeless count in 2010. "Permanent housing is the ideal that we're working toward, but this is the reality."

However, the most serious criticisms come from members of the city council, who say the mayor's administration hasn't announced how to pay to convert the old peanut butter plant into an outdoor shelter. The office, showers, bathrooms, indoor gathering space, and lockers envisioned by Deputy Mayor Darryl Smith in a press conference on November 9 simply don't have funding in the budget that the council plans to pass on November 22 (nor were those amenities funded in the mayor's October draft of the budget).

"I still don't have any kind of printed plan from them about where the money's going to come from," says Council Member Sally Clark.

Smith, who has overseen the project, didn't answer repeated calls asking about funding for Nickelsville. However, in previous statements he indicated that the mayor would ask the city council to set aside some money for the project in the first quarter of next year. But that's going to be a tough sell: It requires the council to amend the budget, forcing it to usurp money from one department to pay for Nickelsville.

Predictably, city council members are reluctant to do that.

"The council gave as much money as we could," says Council Member Sally Bagshaw. "We truly don't have any more money. We've been stretched as thin as this council has ever been stretched." The council signaled it will open up the basement of City Hall to be used as a winter shelter, and now the City, which made severe cuts to meet a $67 million deficit in next year's budget, is tapped out.

"It's not like there's going to be brand-new cash appearing in the city budget," says Clark.

So while McGinn taking on Nickelsville is admirable—and a shift from his predecessor—it's also a double-edged sword. Now McGinn must follow through with diplomacy to charm the council (never his strong suit) and creative sourcing of money (in the drought of a recession). In lieu of those, Nickelsville's future is still up in the air.