Council chiefs have outlined the stark reality that could face Leeds as they warned the coronavirus pandemic has left their finances "as severe as it gets".
Leeds faces a funding shortfall of almost £200m for the year ahead, but current regulations state all local authorities must balance their books or face the risk of being heavily penalised.
If the "black hole" isn't covered, the council will effectively be declared bankrupt.
Leeds City Council has said museums, libraries and art galleries could all be forced to close in the worst case scenario if emergency funding is not approved by central government.
Events such as Light Night Leeds would also have to be cancelled.
Councillor Judith Blake, the leader of the council, warned earlier this week there is a "very real threat of big cuts" to local services. It has now also confirmed they are looking to make 415 redundancies over the coming months.
In a brutal assessment of the current situation, chief executive Tom Riordan said the outlook for all local councils is far worse than the financial crisis of 2008 and the years of austerity that followed.
'We would have to take very Draconian measures'
He said: "This situation is more severe than that because it's a collapse in income and it's unprecedented.
"The potential implications are as severe as it gets. If we can't balance our budget, we will have to reduce expenditure right back to the things that we have a legal duty to provide.
"That would rule out many of the services that we provide today. For example, all the cultural institutions that we fund in the city are non-statutary.
"We would basically have to take very Draconian measures."
Mr Riordan also said Leeds is not alone in facing such bleak circumstances but that he believes central government will step in to help. A decision is expected in July from Whitehall about what financial support will be offered.
"We are a well-run council that has got a very good track record of making significant savings for the taxpayer and keeping services running extremely well," said Mr Riordan.
"If we are in the position that we are, then this is a pretty serious situation not just for Leeds, but for the UK as a whole.
"Until now, the Treasury has recognised the situation that councils are in, but the real issue is now stabilising council budgets across the country."
The council has received £43.7m of government support so far, but says it will have to consider issuing a section 114 notice if "further sufficient government support is not forthcoming".
In 2018, Northamptonshire County Council became the first council to issue a section 114 notice in more than 20 years, after it recorded a £34.4 million deficit.
It was left to make huge cutbacks and only the following local services were permitted:
- existing staff payroll and pension costs
- expenditure on goods and services which have already been received
- expenditure required to deliver the council’s provision of statutory services at a minimum possible level
- urgent expenditure required to safeguard the vulnerable citizens of the county
- expenditure required through existing legal agreements and contracts
- expenditure funded through ring-fenced grants
- expenditure necessary to achieve value for money and / or mitigate additional in year costs
However, Councillor James Lewis - the deputy leader of the council - has ruled out the possibility of an emergency referendum on raising council tax as a solution to cover the money lost during the Covid-19 pandemic.
He said: "It [a council tax referendum] is not something we would consider in the short term to balance the budget. The cost of running the referendum would just add further to the pressures that we would face."
