The upkeep of the dilapidated Ayr Station Hotel and construction supply issues exacerbated by Brexit and Covid are costing South Ayrshire Council millions.
Council leader Peter Henderson said he was frustrated by issues he says are out of the council's control, at a time when they can least afford them.
He said that cost of just one project, Maybole Campus, could rise by £5m — about 10 per cent of the estimated budget.
He added that the owner of the Station Hotel owed the local authority £1.2m at a time when South Ayrshire faces another year of significant cuts to services.
The spiralling costs and availability are laid at the door of what has been described as 'a perfect storm' with a scarcity of European construction workers and lorry drivers following Brexit, and a shortage of timber due to overwhelming demand through increased DIY during lockdown.
The SNP councillor said that the issues with the supply of construction materials will have a massive impact at a time when investment is being made in a range of projects, including new council housing, Craigie Sports Centre and schools.
He said: "We have become a world where everyone is dependent on one another.
"It was all signposted and the government agreed the deal, but now they are saying it is Europe's fault.
"It is having a massive impact. There is a shortage of cement and the price of wood has quadrupled, that's if you can get it.
"There is an impact on our own projects, mainly in costs. It knocks our capital budget because we have planned so much.
"Take the likes of Maybole Campus. That could increase by £5m because of these extra costs.
"Even without Brexit and the pandemic, councils were faced with stark financial decisions."
Cllr Henderson will also meet with the Scottish Government to try and make progress on the hotel stalemate.
"Since becoming leader I have been forcing the issue and will keep forcing it. We are working on the budget already and are looking at £12m in savings, again," Cllr Henderson added.
"We have faced cuts for the last 20 years. We are down to a situation which is basically, which service do you want to lose."
A council spokesperson said: “South Ayrshire Council is currently progressing an ambitious portfolio of capital projects, however COVID-19 and Brexit have led to difficulties in sourcing materials; contractors are also reporting price increases for certain materials.
"As a result, contractors are requesting longer tender periods and alternative specifications for materials.
“As construction costs continue to rise, some of our larger build projects may be affected.
"We are working closely with contractors to better understand the challenges they are facing.
"Where we can, we are specifying building systems, materials and components which are relatively unaffected, and we are receptive to alternate materials being proposed by contractors, which meet our specifications.”
Don't miss the latest Ayrshire headlines – sign up to our free daily newsletter here
