A FINANCIAL watchdog has cleared Leyburn Town of any wrong doing in the purchase of Thornborough Hall.

A District Auditor's report says the sale of the large period house - formerly Richmondshire District Council offices - to the town council for £145,000 was handled appropriately.

But the report also says the cost of running the hall in the medium term and the affect on the Leyburn Town Council precept - the amount of money it raises through council tax - will need to be carefully monitored.

It points out that each D band property in Leyburn was paying 17p a week towards the cost of the hall this year. The precept had risen from £9,670 in 2001-2 to £16,950 in 2002-3 because the council needed £8,000 to help cover the running costs during the refurbishment period when offices could not be let.

In its response to the report, the town council stated it was prepared to subsidise the running of the hall in the mid-term up to 25pc of the potential income from the new offices.

It had drawn up a five-year forecast and the Auditor commented that assuming this was correct no extra cost for the hall will need to be added to the precept in the future .

The annual running and management costs should be about £23,000 which the council expects to meet through letting the offices and function room. The town council stated this week that £20,000 of office space had been let so far.

The District Auditor said that the town council had not incurred any capital loss through selling the community centre and the tennis courts and buying Thornborough Hall, as the estimated value of the latter was more than the combined value of the assets sold.

A grant from Yorkshire Forward covered 50pc of the capital costs, with the town council's share coming from the sale of the community centre and the tennis courts.

The town and district councils have faced vociferous criticism in recent years over the sale of the hall.

The issue was raised at meetings of both the town and district authorities this week: see page 5.