Ingleby Manor free school received approval from the Department for Education last year - but it needs a purpose-built building, and planning permission for that has been rejected by councillors in Stockton.
You can watch the full report from Rachel Bullock below and see our guide to what free schools are and where else they are planned in the North East here.
More top news
More than seven thousand jobseekers in the North East have set-up their own businesses since 2011, according to a new report.
Beverley, Doncaster, Leeds, Northallerton, Ripon and York have also named as race starting venues for the nine-day event.
Visitors to a South Tyneside festival are being advised to expect delays due to tighter security in the wake of the UK terrorist attacks.