The Public Private Partnership will bind the three entities to a range of obligations across three separate contracts, with the finalising of the agreement meaning construction of the four screen cinema complex would be complete by December 2018.

There was lengthy discussion on the topic at the extraordinary meeting as councillors sought clarification on a number of legal matters from representatives of Gowings and Majestic.

"This is a serious commitment and I'm proud of our councillors for continuing to investigate and debate before reaching the conclusion that we formally enter into this partnership," said Mayor Liz Campbell.

Contracts will be signed once notification has been received from the Office of Local Government (OLG) that council has complied with the Public Private Partnership Guidelines of the Local Government Act. 

This outcome is anticipated from an OLG meeting scheduled for mid-June.

"Having the council resolution in place means we can act immediately once we have heard from the OLG," said Cr Campbell.

The agreement will see Kempsey Shire Council contribute a $2m Federal Government Grant as well as $2m in funding from reserves towards the project.

The agreement means construction should commence on July 17 this year. 

Critical to the agreement was negotiations between Gowings and their tenant Target, which saw the building owners negotiate a four-month sit-out period while construction takes place above the Target store. 

The sit-out period will involve Target de-stocking, providing staff with temporary leave arrangements then re-entering the store after the works have been completed.

The four-month sit-out should commence on February 1, 2018. 

Cr Campbell said that while the project aimed to achieve a range of economic benefits, there was a level of risk involved. 

"There are huge economic and social benefits anticipated from this investment. It is estimated 22 direct jobs will be created after construction in addition to the jobs protected in existing businesses, by boosting the foot traffic into the CBD,” said Cr Campbell. 

“As a partner in this business, council will be looking for a return on investment from the cinema operations. Market research and modelling along with a community survey indicates good patronage but that can’t be proven till the facility exists.

“There is a risk that if the community isn’t buying tickets council may not see its contribution returned. However this is an investment in building a social and economic hub in the centre of Kempsey, which will create more opportunities for people to live in and visit the Macleay," said Cr Campbell.