The Environmental Planning and Assessment Amendment Bill 2021 would see funds from infrastructure contributions that usually go to council projects instead diverted to the NSW government.

The Department of Planning, Industry and Environment argued this would "fix the uncertainty of infrastructure contributions, which will unlock new housing supply, deliver vital public infrastructure and boost investment in NSW".

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At Monday's council meeting, Wagga mayor Greg Conkey said the reform would have far-reaching financial implications for local communities across the state.

"The changes aim to limit the type of community work that the local authority can fund through infrastructure contributions paid in connection with new development," Cr Conkey said.

He said numerous local community facilities have been funded under the developer contribution scheme which will be hung out to dry under the new bill.

Councillors Dan Hayes, Rod Kendall and Dallas Tout also spoke out in firm opposition of the bill and what it could mean for future projects in the Wagga LGA.

"I've been working and talking for years about getting council funds spent in some of our existing suburbs that I think have been missing out and that has been challenging enough and to now see a proposal that would use council funds in other local government areas is really just ridiculous," Cr Hayes said.

Councillors unanimously voted to write to senior NSW politicians and call for the bill to be withdrawn.

Council will also request the NSW government undertake consultation with local communities and local authorities about the proposal to limit and divert infrastructure contributions away from local government.

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