SHEFFIELD Council is to write off a £320,000 loan to a community group - providing it stands on its own two feet in future.
Councillors will this week agree to abandon the loan and hand over two leases to the Pakistan Muslim Centre, based at the former Woodbourn Road School.
But the deal means the PMC must find its own funding in the future.
Its activities include e
ducation and training, women's activities, advice, translation and interpretation services.
In the early part of the 25 year lease, the PMC will not pay rent but will instead carry out repairs and make improvements to the building.
From 2011 onwards, the PMC has to invest £37,000 per year in the buildings - the same amount they would have had to pay in rent.
The long lease will mean the PMC can apply for external funding and should eventually run independently without the council's help.
A report to the council's Cabinet says: "The PMC was established in the late 1980s and, for a few years in the 1990s, substantial Single Regeneration Budget and European Union funding was providing for training and enterprise.
"However the expansion was unsustainable and the organisation came close to collapse.
"In 2001 it was agreed that the PMC would be treated like other voluntary organisations and was allocated £30,000 a year to pay for core costs.
"Cabinet also approved a loan to the PMC of £320,000, to avoid the PMC becoming insolvent.
"It has been clear for some time that the PMC would not be able to repay the loan."
The report adds that, currently, the PMC uses three buildings on the Woodbourn Road site without a legal agreement being in place and without paying any rent.
"The PMC's finances have been inconsistent as it is heavily reliant on grant aid," the report continues. "PMC have been reluctant to sign up to a lease for a small part of the site, arguing they need the whole site to become self-sustainable."
Council leader Coun Paul Scriven said: "This plan puts the Pakistan Muslim Centre on a firmer foundation which will enable it to continue its valuable work within the community.''
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The full article contains 418 words and appears in Sheffield Star newspaper.