Homeless people in the Arctic town of Inuvik, N.W.T., will soon lose the place where many sleep and stay warm, as the local homeless shelter will close next month due to a lack of funds.

The shelter is slated to close on July 15, which worries homeless people like Michael Coien, who said he and many others rely on the facility.

"I don't think it's right, because a lot of people will be homeless," Coien told CBC News on Wednesday.

"Right now there's about 20 people homeless right now. I go there every night, almost."

The shelter has been managed by the Nihtat Gwich'in Council in Inuvik, with funding from the Northwest Territories government.

In recent months, the shelter had cut staff and reduced its operating hours from 24 hours to 16 hours a day.

Facing a deficit: official

Even though the Town of Inuvik has rented out the shelter for just $1 a year, running the facility has been too expensive, said Barbara Crawford, a band administrator with the Nihtat Gwich'in Council.

"The operating costs that we had were just over $300,000," Crawford said.

"We did major cutbacks, but the bottom line is that we were still looking at a deficit."

Crawford said Inuvik Gwich'in Chief Herbert Blake will meet with the town's homeless on Friday to discuss alternative arrangements.

The shelter's closure will likely become a major issue for Inuvik's homeless in the winter, according to some.

"I live in a tent right now, and all winter I was homeless — living underneath buildings, anywhere there's a warm spot," said Lisa Ann Firth, a homeless person.

"Now I'm wondering, what's going to happen to all of us?"