An application for $7.9 million towards upgrading the Hume Highway crossing at Davey Road, north of Albury, to a full diamond interchange bombed out in the latest Building Better Regions Funding round.

The complete list of projects to score funding from the $204.3 million allocation will be revealed on Sunday.

"We have not been formally notified of the outcome of our application, but understand that it has not been successful," Albury general manager Frank Zaknich said.

"This is a priority project for council, supported by the NSW government.

"We will continue to work with the Australian government and other key stakeholders to progress the project through other funding programs or partnerships."

Last October, the NSW government came to the party with $9.9 million towards building the southern facing ramps at Davey Road along with a gas connection to the council's Nexus industrial hub, which is presently a major point of difference to Wodonga Council's Logic industrial hub.

In 2015, the council had $7 million in federal funding for the project, but it was returned when a state government contribution hadn't been secured.

Councillors also rejected an option of bankrolling the project itself with a 20-year loan.

Member for Albury Greg Aplin said the $9.9 million NSW contribution would be "quarantined" until council secured more funding.

"It has been budgeted for and allocated to that particular project," he said.

Farrer MP Sussan Ley said: “I completely understand council will be disappointed, but they also understand the Building Better Regions Fund is a highly contested.

"The Commonwealth committed to fund a share in Davey Road in 2015, and I’m confident that can happen again but through a more specific road funding program.

"This is path the council and I are now taking."