A Moyne Shire councillor whose comments at Tuesday's council meeting offended many in the community says the remarks stemmed from a "misunderstanding".
Speaking against the council raising the rainbow pride flag to celebrate International Day Against Homophobia, Biphobia and Transphobia (IDAHOBIT), Cr Jim Doukas said "you've got time to waste on hobbits, but you can't do the volunteers".
Cr Jordan Lockett quickly pulled up his colleague on the remark.
"I'd just like to point out Cr Doukas' inappropriate use of the term 'hobbits' referring to IDAHOBIT day," he said.
Cr Doukas told The Standard he had believed hobbit was a legitimate term, analogous to LGBT.
"My issue isn't the IDAHOBIT day or the IDAHOBITs in general. That's a misunderstanding on my part," he said.
"The LBGT+ group, I don't have a problem with them at all, I know lots of them and they're fantastic people. If anybody feels hurt about me saying hobbits, then that wasn't the intention."
Cr Doukas said he had raised the issue to highlight what he believed was a lack of gratitude towards the hundreds of volunteers that kept council operations running.
"My issue is one they flew the flag, which they had no authority to do, and two they did what they did for IDAHOBIT day and here we are in the middle of volunteer week and no one bothered to do anything for the volunteers," he said.
A council spokesman said the council had run a social media campaign thanking volunteers and had taken a group of volunteers out to lunch and on a tour of Budj Bim. Cr Doukas said he hadn't seen the social media posts and the group taken to lunch were only a small fraction of the council's volunteer cohort.
"They took the volunteers from the visitor information centre. They were the only volunteers they took," he said. "In the past we used to have an afternoon tea or morning tea and invite all the volunteers who could come... We didn't even put an ad in the paper thanking them."
Cr Doukas also said the council had failed to follow its own rules in raising the pride flag on May 17. "Any other flag needs to go to council for endorsement before you can fly it," he said.
Council chief executive officer Brett Davis said the flag request had been raised at "several workshops" and Crs Foster, Lockett and Gleeson agreed, but Cr Doukas said that wasn't true.
"Nah, sorry, don't believe it. Things are getting out of hand here," he said.
"There was never a sit down discussion at a workshop on this issue and it was never highlighted in the workshop agenda at all."
But Cr Doukas said he also didn't understand the council's involvement in IDAHOBIT.
"It's not a council issue, IDAHOBIT day, it should have nothing to do with council... if it was up to me there's a community flagpole down at Fiddler's Green, put your flag up there," he said.
"They're entitled to have their day if they so wish, but is it up to council to jump to their every command without proper discussion?"
The Standard understands Cr Doukas may face disciplinary action under the shire's councillor code of conduct, but he said he wasn't concerned.
"I haven't broken any kind of code of conduct thing at all. I think the councillors have made a song and dance about it, but they've got to get their facts right," he said.
Mayor Karen Foster said Cr Doukas had a right to his opinion and free speech.
"However, Cr Doukas' comments in this week's council meeting are not shared by the majority of councillors and nor do I believe they are shared by the majority of Moyne Shire residents," she said.
"I have received a number of messages and phone calls from residents who are justifiably hurt and angry.
"On a personal level, I find the remarks unenlightened and want to assure all Moyne Shire residents, ratepayers and visitors that they will always be welcomed and valued in our community."