At last Wednesday's ordinary meeting, council resolved to fund half of the $30,000 business case from their own funds and seek funding from grants and other sources for the other half.

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Mr Fletcher, who submitted the business case to council in April, said the outcome is a positive result for the community.

"I'm pleased that council has committed to undertake the business case, especially in light of where they're at with their budget and the impact of COVID-19 on the region," he said.

"It shouldn't be too difficult for council to source grant funding for the remaining $15,000."

The commitment has been accepted outside council's 2020-21 budget, which was formally adopted last week.

Mr Fletcher said the next step will be to get the project locked into council's agenda of operations.

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"The next task for council is to secure a contractor to undertake the business case and determine the viability of the museum," he said.

"I'm hopeful council will come to a sound decision on this case and I'd like to commend most councillors [the mayor and deputy mayor especially] for their support."

The old ambulance station in William Street, which council formally acquired last month, has already been touted as a potential location for the museum, with mayor Bobby Bourke and Bathurst MP Paul Toole voicing their support for the idea.

Cr Bourke said council will now endeavour to determine how the military museum could benefit the Bathurst community from a heritage and tourism standpoint.

"Council has decided to support this initiative as due diligence to see if the project is feasible," he said.

"The business case will answer a range of questions about potential tourism benefits and will also help inform Council's decision about whether to go ahead with the museum."

The museum also has support from the Bathurst RSL Sub Branch.