Winnipeg's Red Road Lodge is facing financial trouble, with staff worrying they may have to cut the services they have been offering to the city's most vulnerable people.

The Main Street lodge houses and supports people who are recovering from addictions and mental health issues. It also provides programming for those living on the street.

But the non-profit facility's funding is drying up. If it cannot secure enough money in the coming fiscal year, staff say they will have to scale back their programming.

General manager Beverly Roberts says she's fighting to prevent the worst-case scenario, in which the Red Road Lodge would simply be renting out rooms.

"It's like warehousing people, and they won't be able to provide any of a supportive role other than [to] call an ambulance or call the police," she told CBC News.

Roberts said she was shocked with the provincial government's most recent offer, which proposed moving the Red Road Lodge's 44 clients into a Manitoba Housing complex.

"The housing services and the support is critical to the revitalization of the area, and it needs to be funded right here on Main Street," she said.

This past fall, the lodge was turned down for a federal grant under the Homelessness Partnering Strategy.

It had to close its art studio, where clients like Kevin Anderson have turned their lives around by producing works of art.

"A huge difference, like, 180 degrees right around. But it took a little bit of, like, patience and a lot of support," Anderson said.

Stefano Grande of the Downtown Winnipeg BIZ says supported housing is key to addressing the homelessness problem in the city core.

"You need to surround these people with supports in order for them to maintain their housing and to move forward in their life," he said.

"We'd like to urge all levels of government to look at the success that was coming out of the Red Road Lodge."

The province says it is reviewing options on how to move forward in the best interest of those living at Red Road Lodge.