The Minneapolis school board Tuesday night delayed a decision on the future of the Minneapolis Urban League’s status as an alternative school, days after fresh doubts emerged over whether the program can meet its goals.

The delay comes after revelations that the Urban League was allegedly double-billing the state and the district for educating some of the same students through similar programs. The Urban League informed the district late last week that it was going to lease its space to a charter school, displacing the 90 Minneapolis students that it educates at the school district-funded Urban League Academy.

“It has become increasingly clear to us that our arrangement with the district has been detrimental to the continued financial well-being of the Minneapolis Urban League,” outgoing President and CEO Scott Gray wrote in a letter to the district Thursday.

District officials and board members say they were blindsided by the charter agreement because it had not come up previously. At a packed board meeting Tuesday, officials voiced concerns over the league’s ability to educate the district’s most challenged students.

“This has never been an issue,” said board vice-chair Kim Ellison in an interview before the meeting. “I didn’t know they were even exploring these options.”

The district awarded up to $800,000 a year to the Urban League to help students who have struggled to get diplomas from Minneapolis high schools. For several years, the Urban League has fallen far below district standards for the program and officials have talked about cutting funding for the program. The Urban League has blamed the district for a lack of support and funding for its shortfalls, and now says it can’t continue the relationship as it stands.

“To be direct, we have been losing money for the past several years as a result of certain conditions of our contract with the district,” Gray wrote. He added that the Urban League remains “committed to exploring all options for maintaining our partnership with you.”

Gray asked district officials for permission to use unused space at district schools, but the district maintains that it does not have any space to lease to the Urban League.

“This is not a defeat, this is a delay,” said the Urban League’s incoming interim CEO Steve Belton. He said the league is taking up the district’s offer to assist them in assessing whether the Urban League can use its headquarters to house the 90 students.

Belton also said the Urban League is committed to continuing its partnership with the district and educating the district’s most needy youth.

At the board meeting, board member Carla Bates said she was “a strong supporter of extending the contract for two years hoping that stability would ameliorate some of the concerns that had arisen,” Bates said. “I am concerned about the instability that space issues always cause. It’s a huge issue.”

Earlier this week, the Star Tribune revealed district and state officials were investigating whether the organization was getting paid twice for similar work.

In 2013, Minnesota legislators agreed to give the Urban League $300,000 a year to help young adults get a high school diploma or high school equivalency degree and help place them in postsecondary education or careers through a program called the 13th Grade. State and district officials say the work seems similar to what they do through their contract with the school district.

Gray says the programs are not identical, and that they have retooled 13th Grade to be a supplement to the Urban League Academy. He also said there is nothing in the contracts that “says that a 13th Grade kid can’t participate in the Urban League Academy or vice-versa.”

Two DFL state senators — Bobby Joe Champion and Jeff Hayden — were the main backers of the legislation and are now seeking to raise funding for the 13th Grade program to $1.8 million over the next two years.

The senators defend the Urban League’s work as essential to closing the city’s achievement gap between white and minority students, which is among the worst in the country.

“Unfortunately, the Minneapolis Public Schools are not graduating kids of color at the level they should,” Hayden said last week.

Gray also is harshly critical of state and school leaders who, he said, have failed to make a serious commitment to providing resources necessary to help troubled teenagers.

“They say they want to do better, but there has to be some real intentional strategy, vs. lip talk,” he said.