Cork City councillors last night voted 18-8 in favour of extending the loan to the board of the cash-strapped Cork Film Festival, which was at immediate risk of receivership. The interest-free loan will be repayable over the next eight years.
The vote to save the festival was taken after councillors debated a proposal from the chair of the council’s arts committee, Nicholas O’Keeffe, to extend the loan.
Mr O’Keeffe told councillors that film festival board members briefed the committee on the financial crisis last week, explained how it had occurred, and had outlined a recovery plan.
He said committee members were told that a certain element of the festival’s financial difficulty is associated with legacy debt, and that a substantial amount is owed to Cork-based creditors.
It is understood that local businesses are owed close to €100,000, that restructuring costs were in the region of €100,000, and the loss of a title sponsor cost the festival some €90,000.
Councillors were told the festival has restructured a bank loan to reduce repayments, and has devised a scaled-back 2016 event which will run over two weekends.
Mr O’Keeffe said he was happy to formally propose extending the loan.
During an hour-long debate, Fianna Fáil councillor Tim Brosnan proposed no vote be taken until an independent auditor examine the film festival accounts.
Anti-Austerity Alliance councillor Fiona Ryan said it was extraordinary how the festival had gone from posting a modest profit to the brink of receivership in just a few years.
Worker’s Party councillor Ted Tynan said he could not support the loan at a time when council services have been hit by cutbacks.
Fianna Fáil councillor Ken O’Flynn called for the current board to be dismissed for overseeing the financial disaster. “We can find €200,000 for this but I can’t get windows in council houses or footpaths fixed,” he said.
His party colleague, Sean Martin, said he was not happy with how it had been restructured, but said the choice councillors had to make was to either extinguish a 60-year old festival or save it. “Do we save it or throw it out?” he said.
He was told the festival is open to the nomination of councillors to the board.
Independent councillor Kieran McCarthy said he was happy after last week’s briefing that all the I’s had been dotted and T’s crossed.
Sinn Féin councillor Henry Cremin said the festival board had been upfront about their difficulties and he was happy the city would be involved in its future management.
Fine Gael councillor Des Cahill also backed the loan. “This is a loan, not a grant,” he said.
The city’s head of corporate affairs, Paul Moynihan, said the city’s finance team had engaged extensively with the film festival. “I am satisfied with the openness and honesty of the exchanges. I think it’s a brand worth saving,” he said.
The city’s head of finance, John Hallihan, assured councillors that sanctioning the loan will not hit council services.