A report says Scarborough Council would need to raise the rents by about 330 per cent at its allotment sites in Woodlands and Quarry Mount to recoup all expenditure.
The report from Nick Edwards, head of finance and asset management, also reveals
that both sites are full and there are 160 people on a waiting list.
The allotments operate at a loss, with an income of £2,893 in 2007/08 compared with an expenditure of £9,504.
Expenditure includes grounds maintenance and water as well as providing and emptying a skip at Woodlands.
Water bills have risen at the Woodlands site in the past 12 months reaching £600 for a quarter.
The report says the water supply could be restricted so it is only available at certain times and allotment holders could be given free or subsidised water butts.
Members of the public are going into the Woodlands site to dispose of household waste in the skips and allotment holders have been asked to make sure the gate is locked to stop this from happening.
Allotments at Woodlands cost £35 per annum while the ones at Quarry Mount range from £8 to £36, and a review of the rents is pending.
Demand for allotments now outstrips the supply, with 79 plots at Woodlands and 15 at Quarry Mount.
The report says funding is unlikely to be available to the council but may be to an allotment association.
People on the waiting list could be encouraged to form an association and apply for grants.
The former Prospect Mount allotments site, which closed in 2005 following problems with vandalism, could be used if there was proper fencing.
At a meeting of the council's corporate strategy overview and scrutiny committee, a task group was set up to look at the provision of allotments.
Cllr Jonathan Dixon, a member of the team, said: "There is a real need particularly at this time.
"It's not only about increasing the health of people but also looking at sustainability issues, making sure we still have people in our community who know how to grow things on a small scale."
Cllr Lucy Haycock added: "The educational side of this is very important and some schools are taking this on.
"There are a lot of people who live in the town who never see things
growing."
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