The council has agreed to bail out Make It York – despite several business leaders urging the local authority to rethink the plans.
Make It York (MIY) has a more than £1 million shortfall this year as its income from the Christmas market, Visit York information centre and Shambles Market have all been hit by the pandemic.
The organisation, which was set up by City of York Council to run the city centre, tourism operation, and inward investment, said without financial support from the council it will close.
It has successfully asked for a loan of up to £300,000 from the council, a letter of guarantee that the council will put up to £1 million towards the organisation during the next two years, and for its annual cash payment back to the council to be scrapped this year.
Senior councillors heard MIY also wanted to waive the rent payment for its Museum Street offices, which it lets from the council. But instead the bill will be deferred, rather than written off, in line with other businesses that rent premises from the council.
Question the request
York businessman Phil Pinder called on councillors to rethink the bailout, saying: “More than 100 people, mostly business owners or key decision makers, have signed a petition I started asking you not to bail out Make It York.”
He added that under the agreement it would take MIY more than 12 years to pay back the rent – but other businesses have been told they must pay off their rent within two years.
Martin Bradnam, chair of Hospitality Association York, also urged councillors to “cautiously and clearly question the request”. He highlighted the number of staff who have left the organisation in recent years.
But Sean Bullick, head of MIY, said: “I think we have all worked very hard together over an extraordinarily difficult period. Governance arrangements are under review and I think are are getting stronger and will only get stronger.”
Cllr Danny Myers welcomed messages of support for MIY from across the city but questioned if council bosses had “got a grip” on the organisation.
He said: “I’m worried a little about how MIY are going to make the money that they project to make, as part of this bailout.
“I suspect that what will grow is a tension between MIY making that money and residents’, micro and small businesses’ views of MIY.
“There are concerns around a fair and balanced approach to what MIY promotes, who it promotes and what it doesn’t provide support for.”
Council leader Keith Aspden said: “We obviously inherited quite a lot of the structure including the principles of handing over the markets and the city centre to MIY back in 2014.
“We’re very happy to work constructively to look at that service level agreement [when it is due to be reviewed] in February.”
Cllr Andrew Waller added: “I’d like to thank the MIY staff for the work that they’ve done in supporting so many city businesses throughout this challenging year.
“It’s been a time for all partners to work together and that has been a very strong feature of the last few months. Whilst unfortunate, the financial challenges facing MIY are not surprising – they’ve affected businesses up and down the country.”
After the meeting, Sean Bullick said: “We are very appreciative of this support from City of York Council, and for the wider backing we have received from right across the city’s business community.
“Without a doubt, 2020 has been a challenging year and not what anyone could have anticipated – however we are very optimistic about 2021 and the future for York’s recovery and economic growth. York has such a strong foundation upon which to build, and the opportunity there for our city is huge.
“Our focus now must be recovering our established economies and working together to build the prosperous future we all want to see for our city.
“With the calibre of Make It York’s board of directors and the expert team we have in place, I strongly believe that we can make a significant and unique contribution to economic growth and recovery in the city.
“We will continue to work closely with partners across the city to achieve this – from local businesses and City of York Council to York’s Universities and key organisations such as York BID and the region’s Local Enterprise Partnerships.”