The not-for-profit organisation raised their cost concerns during discussions to renew their tender for the shelter. As a result, Council claim they are legally required to put the matter out for tender.

Lost Dogs Home contracts manager Kevin Apostolides said they had absorbed a loss of close to $700,000 during the five years they have been running the shelter.

He said if Council were to open a tender with the same high standards they would be looking at a cost of more than $200,000 per year.

“The costs, when it comes to certain standards, do not vary from shelter to shelter; maintaining the health and well-being of animals is an expensive exercise,” Mr Apostolides said.

“Yes, you could run a fly-by-the night operation on the cheap but you would be compromising the well-being and condition of the animals.

“The Lost Dogs Home will not compromise our standards, and Council’s standards have always been in line with ours.”

Mr Apostolides said it would be impossible for them to continue under the 2005 arrangement.

“There are many variables to consider, and most of it has to do with making sure the animals get the very best treatment that we can offer to them in that facility,” he said.

“We also have to pay the staff who feed them and keep them clean, and we have a wonderful group of volunteers exercising the animals - if it wasn’t for them the cost would be a hell of a lot more.

“We have to ... break even. That's obviously very difficult. In 2005, no one told me there was going to be a global financial crisis.”

Mr Gordon said because the Lost Dogs Homes have asked to have the original terms of agreement altered, Council has no choice but to re-tender.

“We have got to re-tender otherwise we would be in breach of the tendering regulations and local government act,” Mr Gordon said.

“I would like to stress that Council has no issue with the Lost Dogs Home, just procedurally that’s what we have got to do.”

Mr Apostolides described Council’s stance as “fair and reasonable”.

“If they [Council] decide to go somewhere else than so be it. If they don’t we are more than happy to take it on again,” he said.