Agreement is yet to be reached on changes to the Doncaster Sheffield Airport lease required to unlock vital funding amidst concerns the reopening project is due to "run out of money" this month.

Around £160m worth of devolution funding was formally earmarked for the project a year ago but will only be released by the office of South Yorkshire mayor Oliver Coppard if the current lease agreement between City of Doncaster Council (CDC) and landowner Peel is altered.

A planned £57m loan to frontload project spending is not due to be drawn until next year and is also dependent on the successful renegotiation of the lease.

A CDC report in May confirmed the sticking point in negotiations is whether the devolution funding will be exempt from a 'turnover rent' clause allowing Peel to receive 20 per cent of annual airport income above annual base rent payments.

Negotiations are continuing over changing the lease for Doncaster Sheffield Airport. PIC: James Hardisty

placeholder image — Negotiations are continuing over changing the lease for Doncaster Sheffield Airport. PIC: James Hardisty

The lease currently lists ‘taxpayer-funded grants from local and national government’ among the areas subject to the turnover rent clause – potentially entitling Peel to millions of pounds from the devolution funding.

But Mr Coppard’s office has said funding will only be released if its contribution is not deemed as turnover. A council report in May said the issue had become a “heavily debated point” in negotiations.

Financial modelling for the DSA reopening project, which already requires the most optimistic scenarios for passenger and freight numbers to be delivered to make the business case affordable, has assumed the turnover rent clause will not apply to the funding.

Dozens of people are already employed on the project, and more than £26m has been spent so far, with the council and South Yorkshire Mayoral Combined Authority (SYMCA) approving £20m in February 2025 “to enable essential activities to continue to progress”.

Councillors have reportedly been warned that the project's current funding is due to run out this month and if the lease renegotiation was not completed by the time of the SYMCA board meeting "it's over basically".

Board papers for the SYMCA meeting next Tuesday have now been published, with no specific agenda item on DSA. However a wider programme performance report says negotiations have made "good progress" but confirms talks are “still live".

It also states SYMCA has commissioned an assurance review from an unnamed “independent expert provider to test arrangements and progress against business case milestones”.

The Yorkshire Post asked SYMCA, CDC and Peel what the impact on reopening will be if agreement cannot be reached this month.

A SYMCA spokesperson said: “An update on progress to re-open Doncaster Sheffield Airport and deliver jobs and opportunities to communities across South Yorkshire is included within the Programme Performance and Approvals Report on the MCA Board agenda.

"The report notes the good progress made to date on the project and the work that is ongoing, including negotiations with the landowner, which continue to progress positively. As the negotiations and other work are ongoing, it would be inappropriate for us to comment further at this stage.”

A Peel Land spokesperson said: “We continue to work closely with CDC and SYMCA and we have no further comment at this stage.”

CDC was yet to respond to request for comment at time of publication.