The president of the newly-revived National Trust of Victoria North East branch will put pressure on governments to better protect Mayday Hills.
Architect Jeff Mueller was elected at the group's first meeting and said the state of, and plans for, the heritage precinct was "an ongoing issue of grave concern".
"It's seen as a nice place to go and have wedding photos, but it's a bit more serious than that and [Indigo] council need to understand that," he said.
"There are issues in how the land is going to be hived off.
"State governments should actually resource regional councils ... and make sure there is a full-time heritage officer in each of local government area.
"Council needs to be making sure any new development is actually compliant with what's been proposed and is respectful of the existing fabric."
Developer George Fendyk said works done to buildings he owned with Geoff Lucas were "of course" compliant.
"Over $3 million has been invested up there and every month delayed is another $25,000 we lose," he said.
"They've [Heritage Victoria] wasted seven years, and they turn around and say it's deteriorating.
"It's taken nearly four years just to get to the stage where Greg Owen is going to do a report, and say 'fix the roof, fix the gutters, stop water ingress' ... and people will get a title to their land and then they can actually do what they want to."
Indigo mayor Bernard Gaffney is meeting with Heritage Victoria in Melbourne on Wednesday on those assessments and works, he told the branch meeting on Saturday.
"A heritage builder is doing some heritage protection works up there and we'd like to see where that's at," Cr Gaffney told The Border Mail.
"We'll also be advocating for people about a subdivision up there."
National Trust Victoria chief executive Simon Ambrose agreed with Mr Mueller's assessment that "demolition by neglect" is occurring to some of the former hospital buildings.
"I think Council needs to have a very close eye on what's going on there," he said.
"One of the problems with Mayday Hills is the the fact it's enormous, and and what do you do with that? We recognise the fact that it costs a lot of money."
Mr Mueller, who practiced for eight years and now teaches, said while Mayday Hill's diversity in its buildings was an attractive feature, it was also a hindrance as some buildings were designed for "pretty grim things", and without windows and the like were not very useful for modern purposes.
"I knew Ian Burke who was La Trobe's site manager there, and they [the university] commissioned heritage studies which said they needed to be spending in the order of $7.5 million dollars a year to hold it where it was," he said.
"That's the reality of it and I suspect we're talking about similar things with the Mount Buffalo Chalet.
"It is huge and it is deteriorating, and it is also a mixed bag in that parts of it are photograph-able and other parts not so much.
"It has the same problem of demolition by neglect, but it's also got the issue of its size and location - it's a fire risk and there's only one road in and out.
"There are some uncomfortable decisions to be made there ... we need to decide which bits we can live with going, in order to make it functional."
The Mount Buffalo Chalet was raised by others at the meeting of about 40 people, including National Trust Victoria's board chair, Kristin Stegley.
"It is absolutely time for the government to start taking full responsibility for this international structure - it is the largest wooden structure in the Southern Hemisphere," she said.
"There is very wide concern about the Mount Buffalo Chalet."
Significant landscapes, protected trees, Indigenous heritage and the Beechworth carriage collection were all raised at the meeting attended by Indigo and Alpine's mayors, whose municipalities with Wangaratta were the main focus.
Eight committee members were chosen for the branch, which was most recently disbanded in 2016 and is now the trust's 12th in Victoria.
Murmungee's Greg Clydesdale was hopeful about what the branch's revival would mean for heritage in the region.
"We are losing our heritage where other countries are revering their heritage," he said.
National Trust of Victoria Advocacy Manager Felicity Watson, one of four people in her position based in Melbourne, said the trust was a recognised name that had power.
"We want to find out what other issues are bubbling up and there have been some significant landscape issues coming up, where there is development and subdivisions," she said.
"Some of those landscapes are protected under the planning scheme and some of those are not.
"We've changed our focus in the advocacy work we do to move away from classifying places to get statutory protection under local planning schemes or the state heritage resister.
"It's a very-well researched and robust register [the National Trust register], but it doesn't have that legal power to protect places from inappropriate development.
"We focus on encouraging councils to do heritage studies and implement those."
Ms Stegley said many people including journalist Barrie Cassidy were supportive of the cause of the revived North East branch.
"Without active local engagement and advocacy for sites of community significance, there is always loss or a negative impact on significance," she said.
"We want to empower you."
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