A COUNCILLOR fears that Burnley Council could be shortchanged over a deal to allow house building next to the former Gannow Baths.

Questions have been raised about a proposed agreement between the authority and the site’s new landlords, which would allow tenants New Life Church to develop spare land behind the baths for housing.

A covenant when the land was sold privately stipulated that it must be used for community purposes.

But church leaders have now reached a deal with the council, permitting homes to be built there.

The organisation was initially granted planning permission for up to 40 homes but it appears only 34 now look likely to be built.

Because of the credit crunch and housing market downturn, coupled with poor ground conditions on site, the council’s executive has agreed to release the land for housing for £238,500.

Coun Howard Baker, Labour councillor for Trinity ward, and an estate agent by trade, is concerned that the council could be getting a raw deal.

Along with colleagues he has ‘called in’ the executive’s decision and it will be reviewed by the council’s better services scrutiny committee on Monday.

Coun Baker said: “I think that the amount of money that has been agreed for the land is considerably less than its market value.”

He says he would have expected the council to benefit to the tune of at least 40 per cent of the site’s development value, which he estimates could be around £2million.

Three or four-bedroom homes could be expected to fetch between £160,000 and £180,000 and the two- bedroom houses could get £120,000, he believes.

Even allowing for a 50-50 split with the church as tenants, the council would ordinarily expect to receive closer to £500,000, says Coun Baker.

A Burnley council official said in a report to the authority’s executive, when the £238,500 deal was reached: “Bearing in mind the current downturn in the housing market, the reduced number of new houses that the site can accommodate and poor ground conditions, £238,500 represents the highest monetary consideration that the tenant is prepared to agree in exchange for the grant of consent.

“The granting of [this] consent will generate a significant capital receipt which can be used as part of the council’s capital programme.

“If an agreement cannot be reached, the capital sum will be lost and the tenant will consider other less satisfactory options, such as the further refurbishment of the former Gannow Pool building for use as a combined church and community building.”