In February last year the council bought the cottages at 59, 63 and 65 Buckingham St and 6 Merioneth St for $1.9 million - the only means under legislation to resolve a ‘‘demolition by neglect'' issue, which arose when the cottages were owned by Irish developer Eamon Cleary.
The restoration does not include Merioneth St.
The cottages were bought from Mr Cleary and then on-sold to the council in a deal brokered by Lake Hayes property developer John Martin.
The Buckingham Cottages Trust was established in April last year and entrusted with the maintenance and refurbishment of the cottages, which date back to the 1870s.
In a report to the council, QLDC deputy chief executive and finance manager Stewart Burns said the restoration of the cottages was estimated to cost $514,000.
The trust had confirmed a total of $433,500 in funding, comprising $100,000 from the council in a commitment made last February; $13,500 from the Lotteries Grants Board; a $220,000 grant from the Central Lakes Trust and $100,000 from the Community Trust of Southland (CTOS).
However, there was still a shortfall of $80,500.
Mr Burns said the CTOS had offered the interest-free loan of a further $100,000, with a value of $45,000 in forgone interest payable.
‘‘In order to proceed with the work the trust wishes to uplift the loan from CTOS and require a guarantee from council to CTOS in order to do so.''
Mr Burns said there were ‘‘no immediate financial implications'' for the council and in the coming five years the trust would continue in its efforts to raise funding for restoration projects.
‘‘In the unlikely event that the trust is unable to repay the loan in five years' time, then council would be required to do so on its behalf.
‘‘The risk is considered relatively low, but on the positive side, the loan enables the badly needed restoration work to begin almost immediately.''
