A $6 million revamp of Deniliquin's historic town hall and surrounding buildings is set to be delayed due to Edward River Council being cut from the border bubble.
Work is being overseen by Shepparton's Moretto Building with subcontractors from Wangaratta, Echuca, Yarrawonga and Tongala.
Victoria's government has removed Edward River and Shepparton councils from its bubble for cross border travel, meaning special permits would be needed for workers south of the Murray River.
Moretto Building director Frank Moretto has been advised they may not be issued.
"It's opened a real can of worms," he said.
A lift from Sydney is due to arrive at the site on Friday, following a six-month wait, and it may not be able to be installed as planned.
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The project involves the creation of a new council chamber, offices and theatre and is due to be completed by the end of the year.
"If we're still in this situation in another couple of weeks that is highly unlikely," Mr Moretto said.
Up to 30 workers have been on site since the project commenced on the ground.
Edward River mayor Norm Brennan said he learned of his council's exclusion from the bubble through a call from NSW cross border commissioner James McTavish at 5.20pm on Wednesday.
"I've got a lot of adjectives I could use, disappointing is mild," Cr Brennan said when asked if he was disappointed at the decision.
"It came out of left field.
"We haven't had one positive COVID test since the start of this pandemic 18 months.
"The Andrews government says there was the positive test in Echuca and they want to stop that getting over the border, yet that was from a non-border resident.
"A lot of this is just putting political spin on things."
Cr Brennan said he had been told Edward River had been earmarked for culling when other Riverina councils, such as Murrumbidgee, Lockhart and Wagga, were dropped in July by Victoria.
Its lack of a Murray River edge appears to have sealed its fate with councils remaining in the bubble being directly on the border.