FIFE Council could be forced to borrow money to help fund the by-pass that would pave the way for 1400 new homes to the north of Cupar.
A report by financial consultants GVA has warned that in the current financial climate, developers are struggling to pay for infrastructure upfront.
Instead, the council may have to part-finance the relief road through loans before seeking the money back from construction companies.
The by-pass and new homes — to be completed by 2026 — are part of the Cupar North expansion proposed in the area’s structure plan.
Ronnie Hair, Fife Council’s lead officer for business land and property, wrote a report on infrastructure funding for the most recent planning committee.
He told the Fife Herald: “It’s possible that the council will have to borrow, but at this stage we don’t know how much.
“The Cupar relief road is a good example in that it’s not a project the council would normally have considered funding — it would have been left to the developer.
“But if a developer is unable to secure finance then the council may consider investing in such projects itself.”
The council expects development-related infrastructure to cost around £250 million across the Kingdom over the next 20 years.
But Mr Hair said it was too early to say how much of that would have to be stumped up by the council.
And he could not say how much the Cupar relief road would cost, although a figure of £20 million has been talked about in the past.
Mr Hair stressed, however, that the infrastructure funding plan is at a very early stage and will be subject to a detailed business case and analysis of financial, legal and technical risks.
The Cupar North housing development and relief road — which would by-pass Cupar to the north, linking the A91 either side of the town via the A913 — have been a source of controversy since the plans were announced several years ago.
The proposals were the subject of vociferous opposition by the campaign group Cupar Against Rural Development (CARD).
Planning officials say Cupar North would meet the needs of a growing population and boost the town’s economy.