Victorian towns are struggling to rebuild years after being hit by natural disasters as councils fight for funds caught in a web of red tape.

In Campaspe Shire, roads still damaged from the October 2022 devastating floods were again thrashed by heavy rains last December.

“Nearly two years since the major flood events of 2022, Campaspe continues to struggle ... to get claims and funding released,” council acting chief executive Michael Sharp said.

“Councils need confidence their up-front investment to ensure safety during and immediately following an event will not rely on rate-payer funding.”

Infrastructure improvement funding is not covered by disaster recovery funding arrangements.

Mount Baw Baw Shire in the state’s south-east has faced nearly 50 significant weather events in four years, including bushfires, floods and damaging storms.

When it was battered by storms in early September, it was already waiting on $10 million in reimbursements from the federally funded, state-managed disaster recovery funding arrangements.

“(Now) we’re sitting on about $14 million in unpaid claims,” Mayor Annemarie McCabe said.

Under the joint funding arrangements, councils undertake recovery works and bill the state, which then seeks federal reimbursement.

But claims are often held up or rejected, partially or in full.

“We’ve got to go out, clear the roads and then just keep our fingers crossed that we’ll eventually get reimbursed,” Ms McCabe said.

Stringent and shifting evidentiary requirements to prove damage — such as recently taken ‘before’ pictures — were particularly tough for tightly resourced rural councils such as Baw Baw, which spans 4500 square kilometres linked by nearly 1800km of roads.

“You can’t be going around constantly getting photographic evidence of things before they get damaged,” Ms McCabe said.

A state government spokesman said nearly $2 billion in state and federal funds had gone towards 2022 flood recovery works, but conceded systems could be improved.

“Councils ... have told us the biggest hurdle to getting recovery funding is overly bureaucratic ways to assess damages and submit claims under joint-funding arrangements,” the spokesman said.

“We’re working with the Federal Government to help money get to communities faster by reducing the burdensome red tape that councils have to go through to access funding.”

A spokesman said the Federal Government was co-ordinating with state and local governments to ensure efficient, effective recovery fund allocation.

“All levels of government are required to ensure taxpayer funds are used responsibly,” he said.

“That is why evidence is required to demonstrate the condition a road or other asset was in prior to any damage.”

Municipal Association of Victoria president and Pyrenees Shire councillor David Clark said smaller regional and rural councils sometimes faced disaster bills that dwarfed their entire annual budgets.

“In 2010-11, our bill was $35 million (after the January 2011 floods), that’s 1.5 times our whole budget,” he said.

Mr Clark accepted the need for responsible spending but said councils faced disproportionate financial risk as their assets deteriorated.

“The logic is absolutely there, it’s just the mechanisms are just not working.”

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