The council backing a massively overspent and delayed millennium project "failed" local taxpayers, according to a highly critical report.
The tower in Portsmouth remains unfinished
The leader of Portsmouth City Council at the time the Spinnaker Tower was developed has been criticised for putting his party's interests first.
And a top council officer failed in his key duties, said the district auditor's report released on Friday.
The taxpayer faces an unexpected £8.4m bill for the project.
The scandal surrounding the tower has already claimed one casualty - Leo Madden, leader of the council's Labour group and former council leader, resigned last week ahead of the report.
The district auditor said he "was in breach of duty" and "subordinated the interests of the council to the electoral advantage of the party".
The director of corporate services at the time was also said to have "failed to discharge his responsibilities with reasonable care, failed to protect the interests of the council, failed to provide appropriate legal advice and was in breach of duty".
Altogether the council faced a loss of £50,000 to £162,500, the report added.
An internal investigation called for a stricter legal process in forming business deals and greater openness between councillors and officers.
'No further comment'
Councillor George Semmens, the chairman of the millennium tower policy and review panel, said 30 recommendations would now be put to the full council on 20 April.
He added: "Because of the remit and sensitivity of the recommendations it would be inappropriate for me to make any further comment."
As leader of the council in 1999, Mr Madden commissioned the millennium project, promising it would not cost taxpayers anything.
Built on Gunwharf Quays, near Portsmouth Harbour station, the Spinnaker Tower was first approved by the Millennium Commission in 1995.
The project, which was originally to be finished by 2000, has been hit by delays and has still to be completed.