Councillors voted unanimously to support a new loan arrangement for Arena Coventry Ltd, the company which owns the home ground of Coventry City FC, at a full council meeting yesterday (15 January 2013).
The move means the council is effectively becoming banker to ACL, so it can pay off its current loan arrangements with its existing bank.
There is no net cost to the council or Coventry taxpayers, with the move set to provide a modest surplus for the local authority, it said. As a result, the interest ACL now pays on its loan will go to the council.
"We have taken a decision that will benefit city taxpayers and secure the future of one of our most important and best-loved public assets that brings great benefits to Coventry people" Coventry City Council leader John Mutton said.
"Not many councils would have done what we've done, but I've always believed that councils can – and should – be prepared to take bold and radical decisions when they are the right thing to do.
"It's up to ACL and the club now to find a way forward on the rent issue; we know that ACL is totally committed to doing this, and we hope the club's owners will be committed to doing so, too."
No cash is being put into the football club by the local authority as this would be "unlawful and inappropriate", the council added.