The Government is offering to hand over its interests in Eden Park, the Cloud and Queens Wharf to the Auckland Council, but the deal carries financial risks to ratepayers.
The biggest financial risk is Eden Park, which is weighed down with $50 million of debt, operates a modest surplus and is struggling to pay for future repairs and capital works.
Ratepayers could also face a $1 million bill to install air conditioning in the Cloud and $660,000 to provide kitchen facilities, a fire sprinkler system and storage space
Under the proposed deal, the Government would gift the Cloud and its 50 per cent share in Queens Wharf to the council.
The Government paid $10.4 million to build the Cloud for the Rugby World Cup after going halves with the former Auckland Regional Council in 2009 to purchase Queens Wharf for $40 million from Ports of Auckland for public open space and a cruise ship terminal.
The Government is also offering to transfer its power to appoint five of the nine Eden Park Board trustees to Auckland Council. The other four members are appointed by the Auckland Rugby Union and Auckland Cricket (two each).
Senior council officers are recommending the council accept the offer from Sports Minister Murray McCully, saying full ownership of Queens Wharf will enhance its ability to redevelop the waterfront site.
The council would not be entitled to any Eden Park assets, nor would it be liable for any losses, an officers' report said.
Ratepayers' exposure for underwriting a $40 million loan to complete the $256 million upgrade of Eden Park for the Rugby World Cup and an outstanding $6.5 million loan for construction of the North Stand would not be affected by the council appointing trustees to the board.
But executive officer Michael Quinn has warned there is a risk the council would be asked to help bail out Eden Park if "adverse market conditions" send it into the red or in the long term when the park requires capital investment.
In the report to be considered by councillors on Thursday, Mr Quinn said it would be difficult for the council not to be part of future funding discussions for Eden Park, "but it may be harder for the council to distance itself ... if it has an enhanced role on the board".
Auckland Mayor Len Brown is keen to accept the Government offer, saying it would put the council in a better position to engage Auck-landers on the future of Eden Park and help to create one of the world's finest inner-city waterfronts.
Eden Park is central to a council review on the future of the city's big stadiums that includes moving the Warriors to Eden Park and building a $20 million venue for test cricket at Western Springs.
Mr Brown said the refurbishment costs for the Cloud were only a suggestion at this stage.
A financial analysis by Waterfront Auckland - the council body that operates the Cloud - shows that after refurbishment the Cloud could be properly marketed to generate more income and eliminate a council subsidy, which was $638,000 in the 2011-212 financial year.
Govt handover to city
* The Cloud - built for Rugby World Cup
* Half share in Queens Wharf
* Eden Park - appointment of five of the nine Eden Park trustees.