Ipswich Town: Council threaten Blues with legal action over �500k rent arrears
IPSWICH: Portman Road bosses could face legal action over a �500,000 bill from their landlords – the borough council, The Evening Star can reveal today.
Ipswich council owns the freehold to the Portman Road ground, although all the structures – including the stands – are owned by the football club.
For years the rent was set at �15,000 a year, but last year the borough decided to review the rent and an independent tribunal was set up to look at what was a fair return.
The tribunal recommended that the council should increase the rent to �111,000 a year – and that it should be backdated to 2004.
That meant that the football club was served with a bill for just over �500,000, which the council says has not yet been paid.
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Ipswich council deputy leader John Carnall said the club had started paying the higher rent last year, but it had not paid its arrears.
He said: “We have been reasonable with them. We have said we would be prepared to accept it in three instalments.”
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If the back-payment, or an instalment, was not received soon he said the council could start talking to lawyers.
He said: “We felt we had to put up the rent, we have a duty to council taxpayers, and we set up an independent tribunal to which the football club came to work out a reasonable rent.”
He said the club had offered to buy the freehold of the ground for �1million, but there had not been discussions on that because the council did not feel it was a reasonable valuation of the site.
Football club chief executive Simon Clegg revealed the rent increase during yesterday’s press conference on next year’s season ticket prices.
He said: “Last year we were hit with a 743 per cent increase in our rent from the (Borough) council, increasing our rent from 15,000 a year to �111,000 a year.”
He added: “743pc is a significant increase. Now I am sure the council would argue that we have benefited from having our rent stuck at level pegging for a number of years.
“But when you have situations like this when things come up for rent-review it won’t surprise you that the council’s expectations were much greater than ours were.
“We got into the situation where effectively the matter was arbitrated on and that’s where the arbitrator came down on.
“We were hit with this in the middle of last year. It is done on a yearly basis, so from the start of 2011 we have already been absorbing those additional costs from the back end of last year.
“I recognise that the council has got its own challenges, but obviously the quantum of the increase was a major concern to us, and a surprise. The previous figure had been the same for a number of years.”
Mr Clegg did not want to make any further comment on the borough’s claim that it was owed �500,000 by the club.
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