Wired Lab in Cootamundra is one local institution who learnt in the last week it would not receive funding for 2021-24 from the Australia Council, which distributes money from the federal government.

Wired Lab director Sarah Last said it was "pretty impossible" for the Australia Council to achieve an expansive representation of communities and cultural activity across Australia, with its increasingly limited pool of funds.

Wired Lab is in its 12^th year of working in the community with artists and non-artists, including farmers, to produce collaborative works.

Ms Last said the arts industry was already vulnerable, operating at less than half its usual capacity across all businesses and organisations because of coronavirus.

New data from the Australian Bureau of Statistics reveals 53 per cent of arts and recreation businesses have closed their doors.

Ms Last said only one regional NSW organisation received Australia Council support in this round, which was based on the north coast.

"Not one regional NSW organisation beyond the Great Dividing Range received support," she said.

Ninety-five organisations were funded this year, down from the 128 that received funding in 2016, a drop of more than a quarter.

"Anyone who was in that 95, I want to be really clear, are very worthy of support. I'm not questioning who got funded ... I'm not really sure how representative regions are within those funding allocations," Ms Last said.

"[But] the lived experience of people living regionally is vital for having these long-term relationships with communities and developing projects and partnerships that are meaningful."

An Australia Council spokesperson said 27 per cent of successful applicants were organisations from regional and remote Australia.

"We understand that many organisations will be disappointed with the latest four-year funding outcomes. Competition for all of the Australia Council's funding remains fierce, and the unfortunate reality remains that demand continues to exceed our budget capacity," the spokesperson said.

"We will continue to advocate for an increased investment in the arts, to enable us to support more organisations and artists to realise their artistic programs which in turn has great social, economic and cultural benefit for all Australians."

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Eastern Riverina Arts executive director Tim Kurylowicz said the Australia Council had "just so much less" funding to allocate and regional programs would be impacted.

"The arts industry is just receiving less and less government support and that is having an impact nationally and also locally," Dr Kurylowicz said.

"There's some really positive efforts and I think they need to be applauded for recognising the desperate need of the arts and culture industry and how it's impacted by coronavirus ... Unfortunately the Australia Council is operating in a really limited environment".

On Wednesday, the federal government announced a targeted support package worth $27 million to help the arts and entertainment industries through the pandemic.

Included is $10 million to be delivered through Regional Arts Australia's regional arts fund, though the specific recipients are yet to be finalised.

Dr Kurylowicz said Eastern Riverina Arts would meet with other regional NSW arts bodies in the next week.

"[We will] put together a list of proposed projects that could put this funding to really good use in communities," Dr Kurylowicz said.

Dr Kurylowicz said it was "a great opportunity" for the government to redress the imbalance between regional and metropolitan arts organisations in NSW, in terms of the funding they received from the Australia Council.

Industry bodies including the Media Entertainment and Arts Alliance and Live Performance Australia have been joined by prominent artists, actors and directors in calling for a greater financial lifeline for a sector which they say has been pushed to the brink of collapse by COVID-19.