Towong Shire this week awarded a $483,727 contract to Kiewa Valley-based company Barton Street Developments for works including amenities block, barbecue facilities, reception-kiosk building and at least two safari accommodation tents.

The funding has been sourced as part of a successful federal application in 2015 for the Destination Tallangatta project.

Last year the council rolled the dice on another federal funding bid which would have elevated the park to "Big 4" status, but missed out.

The Victorian Coalition also pledged $1 million to the park if elected in the last November's state election, but was defeated by Labor.

To meet requirements of the 2015 funding agreement works must be completed by September 30 this year, but the tight deadline has been helped by works being carried in a period of low patronage.

"The things that are happening are things the park desperately needed upgrading," Towong mayor David Wortmann said.

"We've got milestones to meet in terms of the federal funding so we do need to move this project along."

Barton Street Developments built the Tallangatta multi-sport precinct which opened in 2014.

It is also building the $2.4 million Upper Murray Events Centre at the Corryong Recreation Reserve which is aiming to be completed in time for the 2020 Man From Snowy River Bush Festival.

Early works at the Tallangatta Caravan Park include demolition of the existing amenities block and civil works to level off the site.

Park entrance works are not included in the Barton Street Developments deal and will be delivered through a separate contract.

"BSD have shown exceptional initiative in their understanding of the details of the project." council project manager James Filby said.

"They has been heavily engaged throughout the tender and post tender period, providing cost savings alternatives to the design team in an effort to meet the requirements of the funding agreement."

The park on the banks of Lake Hume nearly closed in 2013 when manager, Goulburn-Murray Water, put a temporary halt on bookings until updated Country Fire Authority fire safety regulations were completed.