The county council has had to pay out an extra �60,000 for the scheme

Powys County Council had previously agreed to provide a one-off grant of �150,000 to transform Machynlleth's Royal House on condition of more grants being awarded from the Heritage Lottery Fund (HLF).

But now the council's Board have had to stump up an extra �60,000 for the �681,000 scheme which aims to transform the building into a tourist information office and business centre.

Graham Davey, group director of economic and community regeneration claimed in a report that during the application process the HLF had changed its policy.

I cannot emphasise too greatly the contribution that the Royal House project will make to Machynlleth Graham Davey, Powys County Council

But this claim was strongly denied by a HLF spokesman.

Mr Davey said that the HLF wrote to the lead organisation for the project, Machynlleth-based Tabernacle Trust, stating it could not recommend the scheme without further development work taking place, including a full archaeological investigation.

This led to a meeting between the HLF - who could provide �270,000 towards the project - and other groups involved in the scheme.

Rising costs

This included the Welsh Development Agency, Cadw, Machynlleth town council and local fundraisers who have already raised nearly �5,000 of their �13,500 target.

"Essentially the HLF now recognise that the new approach would be tantamount to moving the goalposts," said Mr Davey.

"The undertaking of further development works would require the trust or the council to acquire the building with all the risks this would involve."

He added that the HLF were worried about rising project costs as the �681,000 costing estimate had been made two years ago.

Charles I is said to have stayed at the building in 1643

The HLF asked the council to underwrite the potential shortfall of �62,000 to cover inflation and other contingencies, with the HLF paying the other 51%.

Charles I

Mr Davey said �15,000 of this money could be provided from an under spend from another Powys project.

"I cannot emphasise too greatly the contribution that the Royal House project will make to Machynlleth, not only from the standpoint of the built heritage but also from the economic development opportunity," added Mr Davey.

A HLF spokesman said the body had a policy of not commenting on live applications, but denied the council's claim it had changed its policy in terms of application assessment.

"We were very clear about our procedure with the applicant and we are aware of the local popular sentiment and enormous heritage value of this project," he added.

The earliest documentary evidence for Royal house is from 1581, although tradition states that Dafydd Gam was imprisoned in the building between 1404 and 1412 for trying to assassinate Owain Glyndwr.

The name probably refers to the tradition that Charles 1 stayed there in 1643.