Tintaldra's memorial to World War I soldiers will be recreated with a federal funding injection of $128,700.
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Community members including Philip Coysh mounted an unsuccessful campaign to have those trees still standing after the fires retained.
The contentious issue went all the way to the Victorian parliament when raised by member for Benambra Bill Tilley, who helped in the bushfire effort as a volunteer firefighter.
But Regional Roads Victoria order them to be razed in early March with a commitment to replanting trees in the same spot.
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Last week, Victorian Senator Jane Hume announced the Avenue of Honour will be recreated.
"There's more than $128,000 to re-establish an Avenue of Honour in Tintaldra, with colourful trees representing the character of our soldiers and volunteer firefighters," she said.
"The project will also create a monument, series of sculptures and storyboard trail, educating locals and visitors, alongside a shelter, pathway, parking area and toilet facilities."
Also in the Upper Murray, Cudgewa Tennis Club will be upgraded with $190,000 from the same federal funding package.
A pedestrian bridge over the Ovens River at Harrietville and three murals on the Kiewa Valley Highway approach to Mount Beauty will share in $160,000.
Mr Coysh has a family link to the Tintaldra memorial with his mother's cousin, Keith Jephcott, serving in World War 1.
"We appreciate the input of funding," Mr Coysh.
"But personally I think it will be a missed opportunity if we don't use some of the timber from the trees which had to be chopped down to create carvings of soldier figures.
"Some of the timber has already been taken into Corryong with plans to re-use it in some way."