THE AFL has given the cash-strapped Kangaroos 30 days to agree to a permanent move to the Gold Coast — or the league will step up plans to establish a 17th team there from scratch.

The ultimatum came during a two-hour meeting yesterday involving AFL chief executive Andrew Demetriou and the Kangaroos board.

If the Gold Coast move goes ahead, the Kangaroos will become the third financially stricken Melbourne club to leave town — after South Melbourne went to Sydney in 1982 and Fitzroy was forced to merge with Brisbane in 1996.

"The AFL is going to the Gold Coast and whether it's with the Kangaroos or anyone else we will be there," Demetriou said. "We will have no hesitation whatsoever in issuing a 17th licence."

Demetriou stopped short of threatening to withdraw financial support from the club, instead outlining its perilous financial situation and promising to open negotiations on a Gold Coast relocation package.

He revealed the Kangaroos' debt had passed $4 million and said the club had two options to consider before Christmas. "They will continue doing what they are doing in Melbourne … or give serious consideration to a relocation to the Gold Coast."

The Kangaroos' board has agreed to put the AFL plan to its shareholders after the league rejected the club's proposal for a "hybrid" Gold Coast relocation — including six to eight games there a season while retaining its traditional base at Arden Street, North Melbourne.

The Kangaroos have four "home" games scheduled at Carrara on the Gold Coast next season as part of a 10-game deal with the AFL spanning three years.

Demetriou said yesterday's meeting largely revolved around the club's financial situation and accounting practices, but also considered the "hybrid" proposal for the Gold Coast. "We indicated to the board that that model was unacceptable to the AFL," Demetriou said.

The AFL chief, who played 103 games for North Melbourne in the 1980s, told the board he had been directed by the AFL Commission to admonish the club for its failure to comply with guidelines under its special financial assistance package.

He also voiced concern over the club's failure to replace chairman Graham Duff, who stood down yesterday.

Demetriou said "we didn't threaten" the Kangaroos with withdrawing financial support and said the league would continue working with the board in an effort to get "a better handle" on their finances.

However, Demetriou told the club it had handled its business poorly over the past season, and did not rule out with- drawing the $1.4 million annual funding within two years.

His ultimatum has infuriated Kangaroos supporters battling to keep the club in Melbourne. David Wheaton, chairman of the new "We Are North Melbourne" supporters group, said the Kangaroos' complex share structure, set up by former chairman Bob Ansett in the 1980s to raise much-needed funds, failed to give members a strong voice.

"We're very disappointed by the AFL's reaction … it ignores the role of members to be involved in (this) decision and what the club does in future," Mr Wheaton said.

Kangaroos chief executive Rick Aylett said it was "very clear" the club faced trying to survive in Melbourne or shifting its home base to south-east Queensland.

"We will continue the dialogue with the AFL and we will continue to evaluate all of the options for the best long-term future for the North Melbourne Football Club," he said. "The hybrid model was basically (about) keeping Melbourne as our base and increasing the number of games over the next few years up at the Gold Coast.

"We thought it was a good option … we thought over the next three, four of five years that would be the way to go and still have a base in Melbourne and continue negotiations. If that doesn't suit (the AFL's) criteria, so be it."

Duff said he hoped the club would remain at Arden Street, but there was more than a hint of resignation in his voice as he left his final board meeting.

"I've always said that in a perfect world we would love to stay in Melbourne and this would be our base. It's not a perfect world," he said.