The chief executive of Blue Mountains City Council says the NSW government provided no criteria for applications made under a $177 million bushfire relief fund, which is accused of being a pork-barrelling scheme.
The NSW government was in February ordered to hand over documents related to the Bushfire Local Economic Recovery Fund after it emerged more than 98 per cent of funding went to coalition-held seats.
The funding was ostensibly for councils affected by the 2019-20 bushfires.
Blue Mountains City Council chief Rosemary Dillon told a NSW parliamentary inquiry on Tuesday the council was still feeling the "cumulative effect" of drought, bushfires, floods and the COVID-19 pandemic.
The bushfires had claimed up to 80 per cent of the Blue Mountains' world heritage area and had cost the region at least $560 million.
Dr Dillon said the council in July 2020 submitted a funding request package of $5.45 million, entailing 23 shovel-ready local projects.
But it was clear by November the council would receive none of the $177 million, which had been allocated to 71 "fast-tracked" projects.
Those projects were almost entirely situated in coalition-held seats.
"We felt we were one of the most impacted areas because of the impact on both the community, the economy and the environment," Dr Dillon said.
The government has argued that the $177 million is only the first tranche of funding and an additional $250 million will be doled out. The Blue Mountains council in January also made applications for this funding round.
But Dr Dillon said there was no criteria issued to the council on how fast-tracked project funding would be allocated - despite later government declarations there was a $1 million project threshold.
"We were just told, shovel-ready," Dr Dillon said.
"I was never told, in multiple telephone calls and teleconferences, there was a $1 million threshold ... my recollection is that I followed up at least three times, it might've been by phone, and I got no feedback at all."
Deputy Premier John Barilaro has previously defended the scheme by saying the first tranche of funding was focused on destroyed buildings.
The federal government provided about $1.5 million in funding to Blue Mountains City Council after the 2019-20 fires, while the state government - outside of the relief fund - contributed $875,000.
It comes after the same NSW parliamentary committee found a $252 million program for amalgamated councils improperly allocated public money on a partisan basis that was "a clear abuse of the grants process".
Some 95 per cent of the $252 million was paid to councils in government-held or marginal electorates in the lead-up to the 2019 NSW election.
The NSW Office of Local Government conceded in the inquiry it had done no merit assessment of projects that received those grants.
The inquiry found Hornsby Shire Council in Sydney's north received a grant of $90 million, more than a third of the entire program, and that this "went against the original intent of the Stronger Communities Fund".