York City Council is retendering the refurbishment of its historic Guildhall building due to concerns over spiralling costs.
The council terminated a £9m contract with Interserve last April after it judged the firm’s cost estimates to be too high.
The revamp of the 15th century building was going to cost an extra £5m-£6m, resulting in additional borrowing costs of £260,000-£310,000 per year.
The council scaled the plans down by removing a proposed upper floor, but this would still have increased the budget and borrowing costs by £4m-£5m and £210,000-£260,000 respectively.
Cllr Keith Aspden, executive member for economic development, said back in May: ‘We’re still determined to make sure that such an in historic complex plays a strong role in York’s future.
‘This is a setback, but we have a duty to offer value for money for the people of York and we can’t let costs spiral. Now we need to focus on making the most of Guildhall’s enormous potential.’
A new shortlist of firms have been invited to tender in January for an 18-month project.