A new St. Paul transitional home for girls victimized by sex trafficking is closing its doors next month because of a state funding gap and red tape that blocks trafficking survivors with criminal records from working at the home, program officials said Wednesday.

But a state agency claims that local nonprofit Breaking Free knew how much money it was getting before Jerry's Place opened, and that workers who failed their background checks could have appealed.

"This discussion over the last few days has surprised us, frankly," state Human Services Inspector General Jerry Kerber said.

Jerry's Place — named after Sgt. Gerald Vick, a St. Paul police officer who was an advocate for trafficked women before he was shot and killed while on duty in 2005 — opened in October as part of a push by Breaking Free to provide a "homelike atmosphere" for girls who had been sexually exploited.

The program was designed to shelter four girls, ages 16 to 17, for up to two years at an East Side house, and offer them support and advocacy services along with development of living skills.

But on Wednesday, Breaking Free founder and executive director Vednita Carter said the board of directors was closing Jerry's Place to "communicat[e] to our clients … that we will not settle for subpar services. We will not cut corners or put them at risk to maintain a program that we cannot reasonably sustain."

Last August, Minnesota's Safe Harbor for Sexually Exploited Youth Law, which has been implemented in phases since it was passed in 2011, essentially decriminalized prostitution for youth under 18 and created a statewide system to help sexually exploited youth.

As part of Safe Harbor, the state Department of Human Services provided funding to four organizations, including Breaking Free, for housing and emergency shelter.

Of $1 million appropriated by the Legislature in 2013 for Safe Harbor housing grants, Breaking Free requested $531,000, according to the department. It instead received $256,000 to reimburse expenses for two years, of which it has so far requested about $68,000.

Last week, Carter told supporters that the nonprofit was cribbing from other funds to keep operating.

As for workers' background checks, Kerber said that shouldn't be a barrier. Prostitution isn't a crime that would disqualify someone, he said; even if that happened, a reconsideration could be requested.

"We understand really kind of the uniqueness of this kind of program. … We all want this to work," Kerber said.

Nicole Norfleet • 612-673-4495

Twitter: @stribnorfleet