The council is asking relevant ministers for permission to use the $15.1 million it received in early 2023 to remediate the land.

The council initially wanted to use the money to restore about 15 per cent of the site, improve infrastructure, accessibility and complete a partial remediation of the pumphouse building. It listed these things in the grant application in 2022.

Now it wants to focus on restoring half of the parkland, which has been closed for a long time, so the community can use it for weddings and other events and the council can move towards its vision for accommodation on the site.

The move comes after Mayor Philip Penfold put forward a mayoral minute at the January council meeting that raised the need for the funds to be redirected.

He told the chamber the state government said there was no extra money in the budget to put towards the remediation of the contaminated land.

Cr Penfold said this meant the grant funding needed to be redirected so it could be used for land remediation and repair work on the pumphouse building.

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"I want us to act in the best interest and open this land, and if the state government can't do that I can understand that, but I think it's worth a try and we are doing the best thing for our residents if we were to make that approach and see what's possible," Cr Penfold said.

"The funding that we have does not open that southern lawn, it does not fund the opening of others areas that are closed due to that asbestos issue."

Councillor Mike Yarrington agreed it was worth asking the question. "I really fear if the money can't be used to do that, then the site will sit there untouched for years to come," he said.

The $15.1 million came from a range of sources. The NSW Government's Regional Tourism Activation Fund Round 2 put in $10 million, Maitland City Council added $2 million, Crown Lands gave $1.5 million and Reflections Holiday Parks put in $1.6 million.

Councillor Robert Aitchison said it was a beautiful site that the council "can't do a great deal with".

"I can't imagine anybody wanting to move into some sort of holiday or resort or caravan park at the moment when it is surrounded by a work site with asbestos," he said.

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Council's infrastructure and works group manager David Moloney said it would take up to 12 months to complete the relevant studies needed before the clean up could begin.

He said it would take between one and two years to remediate the whole site.

Councillor Ben Whiting, backed by Councillor Stephanie Fisher, moved an amendment to remove the reference to proceeding with planning for "appropriate future accommodation on site", which was flagged in Cr Penfold's mayoral minute.

The move was defeated.

Most of the councillors voted in favour of Cr Penfold's original motion.

Councillors Whiting, Fisher and Loretta Baker voted against the original motion.

"It is absolutely very poor governance, not transparent, lacking integrity and it's a very bad precedent," Cr Baker said.

Councillor Baker said the value of the grants should have been included in the mayoral minute and the remediation work on the pumphouse building should have been spelt out.

"Last year we all attended a briefing which included a condition statement on the pumphouse. Now, within that briefing we learnt that there were major issues to do with community safety and a huge cost attached to that," she said.

"We're putting forward a proposal ... that we have no knowledge that we will get any decent outcome from that but we are getting wedged because the outcome we want is the outcome for the community - to be able to use Walka again - and that is always the carrot."