The future of a cinema and arts centre in Denbighshire remains uncertain after council officials said they could no longer continue to cover the company’s £20,000 monthly wage bill.
The Scala in Prestatyn owes £60,000 to Denbighshire council as it has missed three months of payments.
The authority said it is considering ending the payroll agreement to stop putting “at risk large sums of public money”.
Cinema bosses have refused to comment.
The Scala was given a £3.5m facelift when it opened its doors again after closing in 2000.
Last week, general manager Chris Bond said takings had been hit as the good summer weather kept people away.
The venue’s trust board has been seeking specialist financial advice about how to change its fortunes.
Under a credit agreement with the county council, the authority pays the venue’s wages and the venue repays that money to the council. It is those payments which are now three months in arrears.
However, in 2010 the council gave the cinema and arts venue an £86,000 bail-out loan to cover a deficit and has yet to request repayment.
“The council can simply not continue to put at risk large sums of public money to underpin the Scala’s financial deficit,” said Rebecca Maxwell, Denbighshire council’s corporate director economic and community ambition.
Councillor Huw Jones, Denbighshire’s cabinet lead member for leisure, said:
“Despite all our efforts to support the Scala company, it appears to find itself in an unsustainable financial situation.”
He said the authority has been “fully supportive of the Scala as an arts and cinema facility for the local community for many years” by helping with the payroll, providing a subsidy, assisting with marketing the venue and having a senior council member sit on the venue’s board of trustees.”
“We have asked time and time again for information from the board as to how they were going to address their financial situation and the kind of reassurances we expected have not been forthcoming,” he said.
Source: BBC News article 04.11.14