Ingleby Manor free school received approval from the Department for Education last year - but it needs a purpose-built building, and planning permission for that has been rejected by councillors in Stockton.
You can watch the full report from Rachel Bullock below and see our guide to what free schools are and where else they are planned in the North East here.
More top news
"I would personally like to thank the local community for their amazing donations of food, toiletries and clothing. "
Owners John and Irene Hays say there is ''light at the end of the tunnel'', after the pandemic forced them to close 650 UK stores.
There has been resistance to calls to dismantle memorials to the explorer.