Plans to deliver a Birmingham library for the 21st century hit a new crisis after the council warned even a slimmed-down £147 million project carried huge financial risks.
Senior local authority officers and councillors admitted for the first time that it might not be possible to deliver controversial proposals for a split-site library at Centenary Square and Millennium Point.
One alternative under consideration is to revert to a fall-back position by improving and refurbishing the existing Central Library at Paradise Forum, which is facing a £25 million repair bill.
But council leaders are unwilling to pursue such a course because it would put paid to the proposed £1 billion redevelopment of Paradise Circus.
A scrutiny inquiry into the library project heard council acting chief executive Stephen Hughes warn that two-thirds of the £147 million cost of the split-site library depended on Birmingham accessing external funding.
However, an initial application to the Government for a £55 million Private Finance Initiative has been rejected and there was no guarantee that grants from other agencies would be forthcoming.
There would be a "very high risk from a financial perspective" if the council was to push ahead with the new library without maximising external funding, Mr Hughes added.
Two cost-cutting measures emerged at yesterday's scrutiny hearing: n The archives section of the library at Millennium Point will be housed in a no-frills "box-like" structure n No new staff will be taken on to run the split-site library
Mr Hughes added: " Increased staffing levels are felt to be unacceptable. We need to contain the service within the staffing costs that are currently available.
"I haven't got an answer as to how you could design a service to provide lower costs, but that is the reality of what faces the council as a whole."
David Pywell, council strategic director of development, said a £180 million scheme to site the library at Eastside, in a building designed by Lord Richard Rogers, had been rejected because it was " completely undeliverable".
There was little realistic prospect of the council generating enough external funding to deliver the Rogers scheme.
Mr Pywell said he hoped the lending section of the new library, in Centenary Square, would be placed in a "quality" building next to Baskerville House. However, it had been decided that the archives would be housed in a "box-like" structure of similar design to Millennium Point.
Mr Pywell added: "Some people like Millennium Point and some people don't. I am not talking about building a shed, it will be something that is reasonable."
Cabinet leisure, sport and culture member John Alden said the consequences of pushing ahead with a new library without securing a deliverable funding package would be catastrophic.
Coun Alden (Con Harborne) added: "We do not have unlimited capital. If we cannot make the new library sustainable for future generations we are providing a maintenance timebomb."
Ian Ward, Labour's deputy leader, said: "The country's second largest city should not be putting its archives into a basic box at Eastside."