Member for Albury Greg Aplin trumpeted the announcement as being the first centre of its kind in regional NSW.

But it is no closer to being built with no site selected and a blame game starting.

Mr Aplin said funding had not been lost due to the lack of action, but the project was bogged down in red tape.

"I'm extremely frustrated with the bureaucracies that have been involved with this," he said.

"They've been given the resources and haven't delivered yet.

"Sites are still under active consideration, but it might need to be extended beyond the original concept.

"That of course will require some additional funding if that is to be the case."

The original funding announcement was made in March 2014 and seven months later consultants were appointed to come up with the preferred location.

But the consultants’ final report was rejected for not keeping in line with the original project brief, according to Mr Aplin.

Further complicating the saga was the integration of mental health services provided by the Murrumbidgee Health Service in NSW with Albury Wodonga Health following the 2014 funding announcement.

AWH falls under the control of the Victorian Government, but Mental Health Minister Martin Foley turned the heat back on Mr Aplin.

"Despite Victoria’s best efforts to try and work with NSW to get this project off the ground, Mr Aplin’s commitment was an underfunded, poorly thought out idea that requires significantly more planning, funding and work," a minister's spokesperson said.

"We are continuing to undertake further work to determine the most appropriate model and resourcing to best meet the mental health needs of the Albury-Wodonga community."

The spokesperson added the initial budget of $3 million was "insufficient to achieve the agreed project outcomes" of delivering an integrated service centre for community mental health services in Albury.

The minister's office said the $3 million had been returned to NSW Health for further work to be undertaken on the service needs and capital required to build the centre.

AWH chief executive Leigh McJames confirmed the health service was still working on a "range of options" for the centre.

Mr Aplin said he approached NSW Health Minister Jillian Skinner late last year to provide a circuit-breaker.

But Ms Skinner's influence could be reduced as she could lose the health portfolio in the pending NSW Government cabinet reshuffle resulting from Premier Mike Baird's decision to quit.

Mr Aplin said the centre was a major priority for him this year.

"I've asked the Health Minister to intervene because obviously Albury Wodonga Health hasn't been able to bring it about," Mr Aplin said.

"If there is a change of minister I will need to renew my efforts with whoever is the new minister.

"But this issue is well documented.

"I've had discussions with sufficient people who will be continuing in the health area to make sure there is progress this year."