Pendle Council has set aside up to £699,000 to complete the revamps of Colne's 'Muni' theatre and Market Hall.
The extra cash was agreed by the authority's executive after a report outline a shortfall in government Levelling Up Fund (LUF) grants for the projects.
Originally due to reopen in January, the Municipal Hall's refurbishment has been beset by delays after contractors found ceilings unsafe and the balcony at risk of collapse.
Additional re-roofing work and replacement of obsolete electrics have also had to be carried out. In addition, no fire-risk assessment had been done before work began, requiring extra fire safety work.
Thursday's meeting had to decide between stumping up extra cash for work, drawing a line under the scheme leaving it unfinished, or taking funding from Colne's Market Hall project.
Liberal Democrat councillors persuaded executive members to fully fund the extra work required to complete the Muni's refurbishment.
Of the £699,000, some £500,000 will go towards topping up the Muni project with the remainder reserved for work needed to complete the Colne Market Hall refurbishment.
Pendle Council's deputy leader, Councillor David Whipp, who also leads the authority's Lib Dem group, said the levelling up programme in Colne had been grossly underfunded from the start.
He said: "The previous administration bid for £6.5 million, but the average allocation for round one of levelling up funding was £16.5 million and the council should have been bidding for that amount of money.
"There was inadequate consideration of what the true costs of these projects would be.
"We now find the Muni is costing half a million more than planned. With a condition survey before bidding, it would have been possible to anticipate these increased costs.
"Working on old buildings always cost more than you expect.
"Here we have a litany of additional costs, but we've started and we've got to finish.
"If we hadn't been constrained by the ridiculously low bid in the first place, the whole of these schemes could have been properly budgeted for.
"There are a whole series of questions, but we have to approve the overspend and find the funding to see the works completed."
The report also updated the executive on two other levelling-up fund-financed projects in the Colne Heritage Quarter, revealing that the Little Theatre project was now complete and The Hippodrome project was progressing well.
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