Deputy premier and local member Paul Toole says Bathurst Regional Council must come to the table with "up to 80 per cent" of the project costs if it wants a grant to upgrade Hereford Street.
It comes after new mayor Robert Taylor indicated council would seek state or federal government funding to carry out the major works, which are estimated to cost a minimum of $25 million.
He is not the first councillor to suggest this funding route, with Warren Aubin doing the same thing in 2021.
Mr Toole said then that council shouldn't rely on the NSW Government to fund the project, and he doubled down on his comments on Thursday.
"To me, this is a council road and you would expect them to be putting in some serious dollars. They should be looking at funding up to 80 per cent of that project because it's one of their responsibilities," he said.
He said Hereford Street's issues were foreseeable and planning to address them - including funding - should have started years earlier.
"Council has continued to build thousands of new homes in the Kelso area on the other side of the river, but they have not invested back into the road or even put any dollars aside for a new bridge," he said.
To save up the millions needed, Mr Toole said council had to priortise its projects and put money aside every year to fund them.
"Council keeps identifying a number of projects across the local government area. They really have to identify what their priorities are," he said.
Mr Toole also questioned council's use of developer contributions from the Kelso estates, saying some of that money should be used for this key infrastructure.
Regarding developer contributions, council's general manager David Sherley said the money is spent based on the developer contribution plans.
"The plans identify funding is to be collected for roadworks and that's what money is spent on, what is identified in those developer plans," he said.
In October of last year, council resolved to endorse the upgrade of the busy road corridor "as a priority", and proceed to identifying funding opportunities to achieve the various elements of the upgrade.
This was based on a preliminary design for the upgrade, which proposed to expand Hereford Street to two lanes in either direction and replace the low level bridge.
There were also changes proposed to streets and intersections on the approach to Hereford Street to ensure traffic flows smoothly.
The estimated cost for the upgrade, not including the land acquisition and utility relocation, was $25 million.
Mr Sherley said a final design had not been adopted for the project, nor had council identified a funding source.
"Council is undertaking reviews and studies to determine what is the most appropriate traffic solution for that area and part of those discussions will include what funding models are available," he said.
While subject to further discussion, he said it could potentially be a combination of budget allocations, developer contributions, loan funds or grants if available.
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