The funds would be used to boost the water and power supplies to the Mount Keira Summit Park, so the site could serve as a tourist attraction.

Lord Mayor Gordon Bradbery earlier cited multiple projects as possible candidates for funding under the state government's Resources for Regions program - including a $2 million refit to turn WIN Entertainment Centre into a convention centre, and upgrades to the Blue Mile and Grand Pacific Walk.

But council ultimately decided all but the Mount Keira application were unlikely to succeed, Cr Bradbery said.

"It's not just about plucking projects out of the air. They need to meet a series of criteria. Unfortunately the entertainment centre is state property, and although I feel it's a really worthwhile project, it will be up to Venues NSW to find money for it, not this scheme."

From 2011, the government committed $215 million to the four-year fund, which is intended to support projects that will improve economic growth and productivity in NSW.

Deputy Premier and Minister for Regional Infrastructure and Services Andrew Stoner said priority was given to projects that created or enhanced publicly owned assets and provided physical and social infrastructure for mining-affected areas.

In its final year, with $87 million left to distribute, 11 local government areas made 81 applications to the program.

The applications came from Cobar, Lithgow, Mid-Western Regional, Muswellbrook, Narrabri, Newcastle, Singleton and Wollongong.

Councils from Broken Hill, Cessnock and Maitland also made applications for the first time, with 17 between them.

Proposed projects include a regional sales yard upgrade, a lead abatement program and upgrades for an airport.

Mr Stoner said the funding recognised the extra pressure the mining industry brought to schools, hospitals, roads, housing and other assets.

"The Resources for Regions program recognises the need for the NSW government to provide tangible support to these communities to help relieve that pressure and ensure long-term economic viability."

Shortlisted projects for this year's round are to be announced later this year. These projects will then be invited to submit a full application for consideration.