Really? I work for the heritage and arts service for a large county council. There are a folkies scattered through my council. I have even advertised for starting a local session (without success) on the county council free ad website.

If it is not a money making gig, there should not be a problem. A good heritage/arts service would encourage such activities. Keeps the culture alive in the community, doesn't cost the tax payer money and the council can ride on the coat tails of success by endorsing it.