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City officials say they may be stuck in a no-win situation because of two feuding businesses.

Both businesses - Morris Quilting and Togawear - operate out of the former Page Furniture location, 65 S. Main. Neither currently meets retail-operation zoning requirements, according to City Councilman Brent York.The businesses are operating solely on a manufacturing basis for outside companies, York said. Morris Quilting sews quilts and other goods, and Togawear screen-prints T-shirts. Current zoning requires businesses operating downtown to be primarily retail outlets, York said.

"We've been working very hard with both businesses to try and help them meet zoning," he said. "But there are other problems that may not allow both of them to stay in the building."

The City Council voted last week to deny a temporary business license to Morris Quilting on the grounds that company officials have had five months to bring the business into compliance with regulations. However, the council did grant a 60-day operating license to Togawear with the stipulation that the business meet fire codes and begin retail operations.

Togawear officials indicated they could have a lease option on the building and could possibly take over the full building should city officials deny future licensing requests from Morris Quilting.

However, Grace Morris told council members she paid West One Bank, which holds the lease on the building, a sum to retain leasing rights once its current contracts expire.

Complicating matters is the fact that both businesses seemingly intend to open retail operations. Morris officials supplied the council with a detailed list of improvements they could make on the retail side, including installing sales counters and display racks.

"They've made a tremendous amount of improvement," York said. "We have sensed a great deal of cooperation from the Morrises in bringing their business into compliance with planning and zoning."

Because of those improvements, the council granted Morris Quilting a 60-day temporary operating license this week, with stipulations similar to those required of Togawear.

Unfortunately for city officials, the facility does not have enough space to hold both businesses if they continue their manufacturing and retail operations.

"It would be perfect it they both could get along," York said. "But it doesn't look as though they can. It looks as though we'll probably lose one of the businesses. I just wish we could keep both."