CAMPAIGNERS fighting for the historic EMD building to be re-opened as a cinema are angry the council is considering a plan to build a multiplex on the nearby Arcade Site.
Earlier this month the authority announced it was set to work with Islington and Shoreditch Housing Association (ISHA) on a new mixed-use scheme for the land, which has been empty for almost a decade following the collapse of various other projects.
But further details of the ISHA bid were kept secret.
However, aspects of the proposals emerged when the council published minutes on its website of councillors discussing confidential documents relating to the deal.
The minutes state that a new cinema "is a condition of the development agreement", along with housing.
But it has been suggested that the published minutes were inaccurate and the cinema is just an option, rather than a binding part of any deal with ISHA.
If the multiplex is confirmed as a condition of the development, hopes of a revived EMD cinema would be dealt a serious blow.
The building in Hoe Street was closed as a cinema in 2003 after it was bought by the Universal Church of the Kingdom of God (UCKG), which plans to convert it into a place of worship.
The council is currently considering a UCKG planning application, with a decision expected early in the new year.
Bill Hodgson, of campaign group the McGuffin Film Society, said: "This is the third time the council has proposed a multiplex for this location yet all previous attempts have ended in failure.
"Any such development is still clearly years away but the timing of these revelations a few weeks before a decision on the EMD Cinema's future is due to be made is obviously highly prejudicial and looks very suspect indeed.
"If the council does grant permission for the EMD to be converted into a church then such a decision could now be ripe for legal challenge.
"The council's own consultants said the EMD's revival is vital for the town centre's regeneration and would benefit the area far more than an identikit multiplex.
"Both previous Arcade site developers were unconvinced of the wisdom of building a multiplex there and would only do so with additional funding from the local authority.
"If the council is seriously in the business of subsidising cinemas with public money then they should be supporting the one which local people actually want and that is the EMD."
Conservative group leader Cllr Matt Davis praised the council’s latest attempt to develop the Arcade site.
He said: "I think that the current forward movement - which is based on an approach which we put forward in our May manifesto - is extremely positive and I have high hopes it will result in Walthamstow finally becoming the town centre it could and should be.
"However it is still early days."
The council previously said construction could begin as early as 2012.
The Guardian is awaiting a comment from the council.
Documents also reveal the development will be guided by the principle that high-rise buildings are "not the way forward".
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