The city's deadline for the Boy Scouts to extend the lease for its headquarters near Logan Circle came and went yesterday.

However, the two sides were no closer to an agreement that would allow the youth group to remain in the building for a $1 annual rent.

The city and the Cradle of Liberty Council, the scout branch that serves Philadelphia and its suburbs, don't see eye to eye on the scouts' policy regarding gay people.

The U.S. Supreme Court in 2000 upheld a ruling that a private group, such as the Boy Scouts, has a First Amendment right to restrict gays from joining. But city officials said they could not legally rent taxpayer-owned property for such a reduced amount to a private organization that discriminates.

So, in January 2004, The Cradle of Liberty Council issued a nondiscrimination statement, saying, "prejudice, intolerance and unlawful discrimination in any form are unacceptable within" its ranks.

But it wasn't enough. The Boy Scouts' National Council had not taken such a stance.

So, in May, City Council voted 16-1 to revoke the deal that since 1928 has allowed the Scouts to lease the land for $1 a year.

To remain in the building, at 22nd and Winter streets, the Scouts must pay the fair-market rent of $200,000 annually.

Cradle of Liberty Council spokesperson Jeff Jubelirer said it may have difficulity raising the money because "people don't want to give to buildings, they want to give to the programs."

The city's agreement with the Cradle of Liberty requires it to give the group one year's notice to vacate the building.

The deadline to leave if an agreement can't be reached, is May 31, 2008.

Since 1928, the Cradle of Liberty Council has leased the land on which its building stands for $1 a year.

The scouts erected the building and according to Jubelirer, the organization pays $60,000 a year for building upkeep, and recently poured in $2.6 million for renovations. *