The potential loan for the Canterbury Agricultural and Pastoral Association was approved on Tuesday, shortly before the Delta variant outbreak placed New Zealand into level 4 lockdown.
Formerly known as the Canterbury A&P Show, the three-day event usually takes place during November’s Show Weekend but was scrapped in May last year after organisers cited financial uncertainty due to the pandemic and public health concerns.
It was the first time the show, which debuted 157 years ago, had not been held since World War 2.
The council described the loan as a "prudent financial safety net" to meet the association's financial obligations if this year’s show is cancelled because of a lockdown or change in alert levels.
"There is considerable risk associated with planning a major event during a pandemic and the CAPA board is concerned that, if Covid-19 forces the cancellation of this year’s show, they would incur a substantial financial loss that could ultimately lead the organisation into voluntary liquidation,” said Deputy Mayor Andrew Turner.
"To help alleviate that financial stress the council has approved a loan of up to $1 million so CAPA will be able to meet its financial obligations without the spectre of liquidation.”
Turner said the loan would not impact on ratepayers as the interest CAPA pays would cover the borrowing costs.
To minimise any financial risk to the council, the loan will also be secured against land and buildings CAPA owns next to the Canterbury Agricultural Park on Curletts Rd.
