Scarborough councillors will today debate whether to back a merger of Yorkshire Coast Homes with a Teesside-based company.
Scarborough-based Yorkshire Coast Homes (YCH) manages approximately 4,500 properties along the North Yorkshire Coast while Coast & Country has a current rental stock of more than 10,500 homes, the majority in Redcar and Cleveland
The boards of both organisations have formally approved a proposed merger.
However, Scarborough Council owns a voting share of a third of the charity and could have blocked any changes.
However, a change in law has made the councils voting share redundant.
A report, due to go before the authority's Overview and Scrutiny Committee today, notes: "Through its 33.3% ‘Golden Share’ of the voting rights of YCH’s membership, the council is currently able to determine a resolution as to whether the conversion to a CBS (and the merger) proceeds.
"However, from 15 May, The Local Authority Influence Regulations 2017 mean that from that date the council will be required to give up its membership of YCH.
"The council’s associated 33.3% voting rights shall cease. The council loses its ability (through the board and its membership of YCH) to determine YCH’s future.
"Nevertheless, YCH would prefer the support of the Council to implement these changes.
"The council’s on-going strategic support is important for YCH to ensure that the aims and ambitions of the new entity (for example the development of new homes along with investment in services) are achieved.
"They have therefore requested that the council gives its backing to the merger and specifically gives its approval for the constitution of the new organisation."
The committee's recommendation will be discussed by the council's Cabinet tomorrow before being sent to Full Council to voted on.
When the merger was proposed Owen Ingram, interim chief executive of Yorkshire Coast Homes, said: "We believe that by working together to create a larger, stronger organisation the potential for directing resources to essential areas such as new-build development will be increased, making us better equipped to address the region’s urgent need for more affordable housing."