Cleanaway has confirmed an approved development application to build the $8.5 million facility on council-owned land within the Howlong tip site will be surrendered in a saga lasting more than a year.

The project had the backing of former Federation Council administrator Mike Eden and former general manager Chris Gillard, but the return of elected councillors in September and the subsequent departure of Mr Gillard were pivotal moments in the council back-flip.

The move by Cleanaway also prevents a legal showdown with the Howlong Community Committee in the NSW Land and Environment Court.

Federation mayor Pat Bourke described the Cleanaway backdown as a “great result” for the Howlong community.

“They made it clear right from the outset that they did not support the location of the proposed facility,” he said.

“Federation Council will be looking to work with other councils involved in the long-term waste management contract for the region, as well as Cleanaway to come up with a sustainable waste management solution moving forward.

“Council will be seeking to collaborate with other councils to ensure we can support the regions waste management needs and that the solution best suits our growing communities well into the future.”

The council is “unaware” about the financial implications on the move, but Cleanaway, in a statement, hinted strongly it would be chasing compensation.

“We invested considerably in the development of our application, undertaking a rigorous review process with important environment, planning and community issues tested at length,” a Cleanaway spokesperson said.

“We were disappointed that the Federation Council changed its position to not grant a lease on the property.

“We have subsequently surrendered our development approval and are currently considering our options, but are looking forward to resolving outstanding issues with Federation Council.”

In late August, the Joint Regional Planning Panel approved the Cleanaway development subject to 130 conditions.

Cleanaway’s previous attempt to build a compost plant on farmland at Gerogery failed to secure the backing of the JRPP.

Federation ratepayers are already facing a costly payout to Mr Gillard.

HCC chairman Stuart Sizer said the “right outcome” had been achieved.

“The financial cost to the Howlong community has been tens of thousands of dollars in pursuit of the right outcome not to mention the costs incurred by Federation Council itself in correcting that poor decision,” he said.

“The proposed facility was a poor decision from day one and the leadership from the Federation Council then under administration was non-existent.

“We needed to be consulted and listened to but we were instead ignored.

“The community was not against composting, but we were against a facility on a site a mere 650 metres from the nearest home.”

The interim kerbisde waste arrangements between Albury Council and Cleanaway will remain in place.