A Northland group working to create a steam and cycle trail experience they say will be unique in the world is ''bitterly disappointed'' to miss out on funding from the Provincial Growth Fund.
The group had applied for $18.8 million to pay for a new railway station at Ōpua, a second steam engine for the Bay of Islands Vintage Railway, restoration of the steam ferry Minerva and the railway to Ōpua, a new cycle trail alongside the tracks, and job training facilities in Kawakawa.
No reasons were given when the application was rejected, vintage railway spokesman Frank Leadley said.
''But we're not going to take this lying down. It's too important for the region.
''It's been five months since we put our application in. It was a very detailed application and in that time we heard nothing, so we assumed all was going well,'' Leadley said.
''We are going to regroup. We will have a meeting (this month) to look at ways we can resubmit the application, perhaps by breaking the project down into its components. The combination of steam boat, steam train and cycle trail is going to be unique not only in New Zealand but, we believe, in the world,'' he said.
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PGF spokeswoman Jo Watt said the fund did not discuss declined projects or projects in process for reasons of commercial confidence.
''Applicants can, and often do, re-apply after a decline. This is one of the reasons we don't comment on declined applications,'' she said.
Regional Development Minister Shane Jones said he appreciated people would be disappointed by the decision.
He had advised officials to identify how the proposal could be refined to make it a better fit to the PGF criteria, and to re-engage with the applicants in the New Year.
''Kawakawa has been reasonably well showered with fiscal lucre but unfortunately not everything passes muster. In absolutely no way is this a mark of disrespect for the people who have kept the vintage railway kaupapa going,'' Jones said.
The project brings together the railway trust, the Kerikeri Steam Trust (which is restoring the 109-year-old steam ferry Minerva), the Twin Coast Cycle Trail, local iwi Ngāti Hine, the Far North District Council and its commercial arm Far North Holdings.
Other components of the plan include a new boiler for the steam locomotive Gabriel; cycle facilities, wetland restoration, a turntable and water tower at the Ōpua railway station site; a new cycle way on the seaward side of the rail corridor between Long Bridge and Ōpua; and an expanded carriage shed and job training facilities in Kawakawa.
Leadley has previously said the project would create up to 25 jobs and act as a catalyst for other businesses, creating a ''great economic boost'' for Northland.
John Clode, of Kerikeri Steam Trust, said the rejection was a ''great shock''. The trust had ''huge commitments'' and was exploring other ways its could attain its objectives, he said.
Projects part- or fully-funded by the PGF in the Mid North so far include a roundabout at Waipapa; wharf upgrades at Russell, Paihia and Opua; feasibility studies for a business park at Ngāwhā and irrigation dams near Kaikohe; a mountain bike park in Waitangi; an upgrade of Ngāwhā hot pools; Te Hononga in Kawakawa; and a new terminal at Kerikeri airport.
As of October 31 the PGF had granted a total of $352 million to 85 Northland projects.