The projected costs of a major Black Country regeneration scheme have spiralled after a private sector development deal fell through according to a report seen by Birmingham Post.
Walsall Council has taken steps to prevent publication of the financial details of the Cabinet report - claiming it could affect future contract negotiations.
But it shows that the cost to the council taxpayer of transforming the blighted former IMI James Bridge Copper Works site at Darlaston into usable industrial land has soared since an £18 million deal with private sector developer, Parkhill Estates, fell through late last year.
Estimates of potential jobs from the Pheonix 10 for the area have at the same time fallen from 4,000 to 3,000.
The site is thought to be suitable for large warehouse and distribution units to take advantage of the location near to Junction 10 of the M6,
The Cabinet agreed to seek a long-term loan to cover the potential costs which would be repaid via the Black Country Local Enterprise Partnership through increased business rates from new occupiers of the 37-acre site.
It also reveals that despite expected income from coal extraction and ultimately land sales there is still a strong risk that the council might never recover the initial investment.
In a behind closed doors meeting the Tory-Lib Dem cabinet approved the scheme as too important to shelve even though it has been unable to attract private sector partners.
The council will pay £1 to buy the land from the Homes and Communities Agency and accept responsibility for reclamation, which they estimate will cost millions of pounds.
Opposition Labour group leader, Coun Tim Oliver, said the project is vital to the regeneration of the borough and the Black Country but added that the council has mismanaged the project from the start by allowing the Parkhall deal to collapse.
He said: “The costs have increased while the predicted jobs number has fallen from 4,000 to 3,000. We have to ask why the budget has spiralled, what is being done to ensure costs don’t continue to climb?
“It’s ironic local Tories, who argue against public sector borrowing, are being forced to take out loans to fund a project they originally told us would be paid for by private money.”
Cabinet member for regeneration Coun Adrian Andrew (Cons) said: “We don’t want to release the potential costs of the remediation gives any potential company information about how much money we have got in the bank. You don’t tell a builder how much you can afford.”