£20 million hole in funding for Leeds trolleybus

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Leeds’s £250m proposed trolleybus system is facing a £20m funding gap.

The Department for Transport (DfT) is to put a maximum of £173.5m into the project while the council and Metro, West Yorkshire’s public transport authority, have agreed a total contribution of £57.1m. But with the cost of the scheme estimated at £250.6m, it leaves a funding black hole of £20m.

Council and Metro officials say they are trying to find extra sources of funding for the project, which was given the green light in July.

But should a shortfall still exist in 2016, when construction is due to begin, a further contribution is likely to come from the council’s capital spending programme, which supports major building and development projects.

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A recent report to the council’s executive board said: “There is currently a funding gap which must be met from the promoters (the council and Metro), however, work will progress to seek to identify additional sources of funding to meet any shortfall.

“Should a shortfall still exist, there would be a call on the council’s capital programme resources and this would be required late 2016 at the earliest.”

Coun James Lewis, Metro chairman, said he was not worried about the gap and outlined a number of ways it could be filled including an increase in the value of the land that forms part of the local contribution or borrowing to be funded by trolleybus ticket income.

He added there was leeway in terms of design and procurement and the scheme “could well come under the £250m estimated cost”.

He said the current estimated shortfall was less than 10 per cent of the value of the whole scheme and added: “All the figures have been through the Treasury, Department for Transport and the council’s approved processes. It has been accepted by all involved as an acceptable amount to be found.”

The DfT announced in July the scheme had achieved programme entry approval. It has two more hurdles to clear – conditional approval, when all the legal processes have been completed and full approval, to be granted following the receipt of all tender prices but before contracts are awarded.

The initial plan is for two routes – Stourton to the city centre and from the city centre north to Holt Park.