(CNN) -- The rejection of the resignation plan for the embattled police chief in the Trayvon Martin case leaves Sanford, Florida, in "limbo," the city manager said Tuesday.
"It would be better for us to have a separation," City Manager Norton N. Bonaparte told CNN, speaking about Chief Bill Lee. "It will be challenging for him to come back."
City commissioners in Sanford voted Monday to reject the proposed resignation of Lee, who has been under fire for the handling of the probe into Trayvon Martin's death in February.
Lee has been on paid leave since March 22, a day after the commission expressed a lack of confidence in him because of the case. He remains so after the commission's decision, and Capt. Darren Scott continues to serve as acting chief.
The chief's hiring last May was sparked in part by outrage after the white son of a Sanford lieutenant was caught on tape beating a homeless black man in December 2010 but was not arrested until a month later, when news stations began airing the video.
The Martin case has sparked intense discussions about race, gun control and the state's "stand your ground" law, which make it legal for people to use deadly force when they feel a reasonable threat of death or serious injury.
Neighborhood watch volunteer George Zimmerman, who has said he killed 17-year-old Martin in self-defense, was not arrested after being questioned by police the night of the shooting. Weeks later, after a special prosecutor was assigned to the case, he was arrested and charged with second-degree murder. He was released from jail on bond early Monday and hours later entered a not guilty plea.
Sanford residents and many civil rights leaders from outside central Florida have criticized the city's police department for not immediately arresting Zimmerman, a 28-year-old Hispanic, after he shot the unarmed black teenager.
On Monday, the city issued a statement announcing that a separation agreement had been reached with Lee to resign. If approved by the City Commission, it would have taken effect at midnight.
But by a 3-2 vote, the commission opted not to accept the proposed deal, which would have permanently dismissed Lee from the job and given him a severance package. Two commissioners had questioned the fairness of Lee losing his job. Mayor Jeff Triplett said he preferred to wait possibly several months for the results of an investigation into Lee and his department.
"I'm not ready to have him come back and run the police department, but I don't know if I'm ready for this either," said Triplett, who sided with the majority to reject the resignation.
Bonaparte said Monday that "moving the city forward" is a priority, and something that he hoped might have been expedited by making Lee's departure final.
"Basically, what the city commission said is that they want to have more information. In particular, they want to have the results of an independent investigation that would determine what actually took place that night and how the Sanford Police Department acted. Did they do things that they shouldn't have done, or did they not do things that they should have done?" he said Tuesday.
But Bonaparte said he and Lee "determined that with the vote of no confidence, it would be very challenging for him to continue as the police chief" and worked out a severance plan.
Bonaparte said the review will "take time" and there will be a lot of evidence emerging since the case is a criminal matter. He has said an interim chief -- who would replace Scott, the current acting chief -- could be in place early next week.
"While I asked for a review, it seems as though it will be some time before I can get that information, maybe as much as three months or more," Bonaparte said. "And rather than staying in this limbo, it would be better for us to have a separation. Chief Lee and I talked and came to an agreement it would be best if he separate from the Sanford Police Department."
He said "tensions got pretty hot" at the city commission meeting, which was attended by several police supporters and "those who say that Chief Lee should not come back."
Patty Mahany, a commissioner who is supportive of Lee, said Monday that reports of gaping rifts in Sanford along racial lines have been vastly overstated. "I don't think Sanford needs healing," she said.
"What did the chief do wrong? I mean, tell us," Mahany added.
Randy Jones, another dissenting commissioner, pointed to other parts of the agreement stating Lee was "willing, ready and able" to remain on as chief, hadn't been found to have done anything wrong and was resigning on Bonaparte's "recommendation."
Jones blamed outsiders for fanning the flames.
"It is not Sanford residents who created this firestorm," he said. "It was brought in from the outside. We all know it."
But Bonaparte said people in Sanford, as well as those across the United States, "felt that there was an example where black life was not being truly valued."
"The fact that Mr. Zimmerman could kill Mr. Martin" has "struck a nerve" in Sanford and throughout the country, Bonaparte said.
Benjamin Crump, a lawyer for Martin's family, criticized the commission for not letting Lee step down.
"Sanford residents deserve quality leadership in law enforcement who will handle investigations fairly for all people," he said. "If Chief Bill Lee recognized that his resignation would help start the healing process in Sanford, city leadership should have accepted it in an effort to move the city forward."
In March, Sanford's city commission passed a 3-2 motion expressing "no confidence" in the police chief. Triplett and Commissioners Velma Williams and Mark McCarty voted for the motion, while Mahany and Jones voted against it.
Aubrey Jewett, a political science professor at the University of Central Florida who specializes in Florida politics and state and local government, said Triplett's vote Monday to reject the police chief's resignation was surprising since the mayor voted for the no-confidence motion in the first place.
Jewett said he thinks Triplett's motivation is to foster calm and moderation and to reach out to different sectors of a town where people are at odds over the police handling of the case.
"My initial thought was he's sort of being cautious," Jewett said. "He wants to take his time and not rush. It sort of fits his leadership style."
Zimmerman is now free and awaiting trial, after making bail and leaving the John E. Polk Correctional Facility in Sanford at 12:05 a.m. Monday.
"He's doing well. He's very glad to be out, trying to get settled in, still worried about his safety ... talking to his family and feeling much better than being in (jail)," his lawyer Mark O'Mara told CNN later Monday.
Also Monday, O'Mara filed documents in court in which Zimmerman entered a written not guilty plea and waived the right to appear at a formal arraignment.
O'Mara said Zimmerman is now "on his own" with no police protection or security detail, shuttling to and from several secret locations in light of threats against him and his family. He wore a bulletproof vest while leaving the jail accompanied by Michael Smith, the owner of Magic Bail Bonds.
"There's been a lot of chatter lately about his release, and that's concerning to him and us," O'Mara said.
The Seminole County Sheriff's Office said that Zimmerman had been fitted with a GPS monitoring device, allowing authorities to track his location.
Zimmerman's release came as something of a surprise. Over the weekend, his lawyer had said Zimmerman might remain behind bars until the middle of this week as his team worked to secure funds to meet the $150,000 bail set last Friday.
With the 10% cash payment customarily made to secure bond, Zimmerman's family needed $15,000 for him to make bail.
Martin's family wasn't pleased by news of Zimmerman's release, said one of their attorneys, Daryl Parks.
"It's tough for them to see their son's killer walk free again," he said.
Although details of the shooting remain murky, what is known is that on February 26, Martin left the home of his father's fiancee in Sanford and went to a nearby convenience store, where he bought a bag of Skittles and an Arizona Iced Tea.
After spotting him, Zimmerman called 911 to report a "suspicious" person in the neighborhood. In the call, the neighborhood watch volunteer said he followed Martin after the teen started to run, prompting the dispatcher to tell him, "We don't need you to do that."
Zimmerman claims the unarmed teen attacked him before he fired his gun. Martin's supporters say Zimmerman targeted Martin because he was black.
On Friday, Zimmerman's father testified that when he saw his son the day after the shooting, he was wearing a protective cover over his nose, his face was swollen, and he had two vertical gashes on his head.
Martin's family and the special prosecutor appointed to investigate the case have rejected Zimmerman's self-defense claim, saying they believe Zimmerman disregarded the police dispatcher who advised him to stop following Martin, racially profiled the young man and unjustly killed him.
CNN's Vivian Kuo, David Mattingly, Leslie Tripp Holland, Martin Savidge and Holly Yan contributed to this report.