Moray Council spent £325,000 putting together a bid to the UK Government’s Levelling Up Fund.
The region missed out on cash in the latest round of the funding. They had put in an £18million bid.
Westminster provided around £125,000 of the cost, leaving a shortfall of £200,000.
The £18 million was to be used on three projects in Elgin.
One was to address flooding issues at the auction mart and former sawmill site on Linkwood Road.
£325k spend on funding bid
Disused buildings in the town centre were to be redeveloped for commercial and residential use.
The third was to create an arts centre on South Street.
Around 40 jobs were expected to be created.
A spokeswoman for Moray Council said: “We’ve committed in the region of £325,000 on design work for the projects included within the bid, of which the UK Government has provided £125,000.
“The majority of the cost is on traffic modelling and designing a nature based solution to address flooding and drainage issues to open up the long constrained former sawmill site and auction mart for new business opportunities and resultant jobs.
“The projects designed to this stage will either form part of a bid to a third round of the UK Levelling Up Fund or an alternative funding source which we are exploring with partners.”
SNP councillor for Elgin South Graham Leadbitter is frustrated investment in the town is now uncertain.
He said: “A tremendous amount of work has gone into this bid, which would have begun a huge regeneration boost for Elgin and for Moray.
“While that work can be used to support other funding bids, the fact is we could have been moving forward with substantial investment in our region.
“Now that investment is is very uncertain.
“My understanding is there was positive feedback prior to the decision being made.
‘Mystifying’
“That makes the final decision all the more mystifying.”
Amber Dunbar is Conservative councillor for Elgin North. She believes work put into the bid will be vital when applying for future funding.
She said: “I share the disappointment that many have that our levelling-up bid was not successful.
“But we know applications that received significant funding in this round had previously been declined in round one so there is a route to success despite this setback.
“It is also clear that this modelling work was required and will be vital if the council goes for round three levelling up funding or for alternative funding sources.”
Labour councillor for Elgin North Sandy Keith raised concerns over whether the local authority could afford to continue submitting unsuccessful bids.
He said: There’s always an aspect of having to speculate to accumulate.
“But it’s particularly galling that we didn’t get any of that £18 million.
‘Particularly galling’
“There are three aspects of the bid that all fitted together.
“It’s really disappointing the government didn’t see fit to approve at least part of the proposal.
“And there’s a limit to the amount of £325,000 spending hits the council can take given the financial situation.”
Moray Council has to make £27 million of savings over the next two years.
Mr Keith believes Moray is not getting a “fair shake of the leg” when it comes to funding. He says this applies to both Westminster and Holyrood.
Lossiemouth Community Hub recently received £270,000 from the Scottish Government Regeneration Capital Grant Fund.
£18m Levelling Up funding bid rejected
But if the £236 million distributed from the fund so far had been done based on population, Mr Keith says Moray would have received £4.5 million.
Conversation