The fight to protect a 150-year-old public garden from development is set to move to the Victorian Civil and Administrative Tribunal.
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Corangamite Shire Council had approved a permit for a new toilet block at Camperdown's Lakes and Craters Holiday Park.
Camperdown Botanic Gardens and Arboretum Trust committee member Janet O'Hehir said the facility needed to be protected for generations to come to enjoy it.
"It's the sort of site you should be making a major visitor attraction," Ms O'Hehir said.
"It could be a fabulous asset - not just for Camperdown, but for the whole region."
Ms O'Hehir said the group had obtained the services of legal representatives and expert witnesses to take their fight to VCAT.
"This is a community asset that is basically being privatised," she said.
Ms O'Hehir said the group had come up with an alternative solution - terminating the lease between the council and the applicant, with the council paying an agreed sum as financial compensation to the applicant.
She said this solution was a win-win.
"Council will save money, including monies harvested from ratepayers, given the amount of compensation will be less than funds already allocated or proposed to be allocated in council budgets," Ms O'Hehir said.
She said it would be a win for the community, as it would be a step towards it recovering the Camperdown Botanic Gardens and Arboretum as a public park asset.
"The community will recover a valuable asset with the potential to bring economic benefit through attracting visitors to the region and the town," Ms O'Hehir said.
She said group members had committed a substantial amount of funds towards fighting the council decision.
But she said it would be worth it if the decision was overturned.
Corangamite Shire councillors had given the green light to spending $200,000 on the amenity block when it approved its 2018-19 budget.
The issue is expected to go to VCAT early next year.
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