The decision at Tuesday's extraordinary meeting effectively withdrew support for the 56km route on an abandoned rail corridor, just days before a state government review on rail trails was released.

Instead, Upper Lachlan will loan 'non-monetary support and advocacy to Goulburn Mulwaree Council for the establishment of a rail trail within the Goulburn Mulwaree LGA.'

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"It's quite devastating for the project and certainly from a personal point of view," Cr Kirk said.

"We were absolutely unprepared for that outcome given the project's history."

"...Tuesday was the shortest day of the year and in my opinion, Upper Lachlan Council was short of understanding, vision and appreciation of the long-term benefits."

Cr Kirk, a Goulburn Mulwaree councillor who also chairs the Goulburn to Crookwell Rail Trail Inc group, branded the decision "premature" given that updated studies on costings, feasibility were yet to be completed, along with more thorough consultation with concerned landholders along the route.

In addition, a state government review on rail trails, including their benefits and guidelines for future projects, was released on Thursday, June 23. Cr Kirk said it was "favourable and progressive" and set out the evaluation process for rail trails that traversed two council areas.

Upper Lachlan Shire Mayor Pam Kensit was contacted for comment.

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The item was debated at Tuesday's meeting after Goulburn Mulwaree Council resolved in May to call on Upper Lachlan to "reaffirm its commitment to the rail trail" and allocate $15,000 to complete updated studies, given the passage of time. Goulburn Mulwaree has also allocated $15,000.

An original motion put to Upper Lachlan's meeting did not commit to funding but noted that Goulburn Mulwaree would undertake the feasibility study. It allowed time to review the state's report on the effect and success of the Tumbarumba to Rosewood Rail Trail, and for landowner consultation to occur if the Goulburn to Crookwell proposal proceeded.

But this was voted down five votes to four with Mayor Pam Kensit, Deputy Mayor Mandy McDonald and Crs Nathan McDonald, Susan Reynolds and John Searl opposed.

Earlier, Cr Nathan McDonald had foreshadowed a motion that withdrew support for the rail trail. This was ultimately successful, with the same five councillors mentioned above voting in favour.

Cr Nathan McDonald said he'd fielded "quite a number" of calls from Crookwell district landholders in the past week who opposed the trail. He argued a shorter route, from Goulburn to Woodhouselee and within Goulburn Mulwaree's boundary, was a "better distance."

"My main concern is the financial stability and future of this council. As a councillor I can't support a rail trail that will put this great shire at risk of financial instability," he said.

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The rail trail was earlier estimated to cost $14.2 million but Cr Kirk expected this had risen to $20m or more. It is proposed to be entirely grant funded.

Other councillors had also expressed the need for landowner consultation.

Goulburn to Crookwell Rail Trail Inc vice-chair and Upper Lachlan councillor Paul Culhane stressed before the vote that "such a radical decision at this point would mean the entire rail trail was dead."

"The business case is based on it going from one end to the other so (now) the economic parameters won't stack up," he said.

Cr Culhane also pointed to "the very significant (state government) reports" about to be released and said there had been enormous consultation, which would continue in the next phase.

Cr Kirk agrees and says he's struggling to understand the decision in light of Upper Lachlan's reaffirmed support as recently as November, 2021. Its backing stretched back to 2014 and the original concept emanated from the former Crookwell Shire Council up to 20 years ago.

"The concept has not changed from last November but the heads around Upper Lachlan Council have and so too has the attitude to the project..." he said.

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Cr Kirk believed councillors lacked a strategic overview and had delved too far into the detail before studies were updated. He rejected one councillor's suggestions the project would only benefit Goulburn and didn't have widespread benefits for the Shire.

"I can't think of any other project that creates $3 million to $4m in revenue year on year for our region. You can't close the door on that," he said.

While acknowledging Upper Lachlan's door appeared closed at this stage, he hoped it would re-open once the review was released. Meantime, Goulburn Mulwaree is likely to revisit its position.

Cr Kirk isn't giving up hope yet.

"I didn't come this far to only come this far. I want to be positive and see this project tested to its full potential," he said.

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