The Yarrawonga Community Action Group is calling for Moira Shire Council to lease the whole of the former Yarrawonga Primary School site from the Victorian Education Department, whilst negotiations continue to acquire the site for community use.

Action Group president Geoff Campbell said acquiring the site was "a once in a lifetime opportunity".

"The Shire should just grab it now," he said.

"It doesn't have to be used next year it can be used in 10 years time."

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Action group member Carol Henderson said the community wanted to be able to use the site, but the council had to be "dragged kicking and screaming" to start the process.

"Delay is the biggest concern," she said.

"We need infrastructure in Yarrawonga. It's not keeping up with the rate of growth and we have families and organisations who want to use this site."

Moira Shire Council chief executive Clare Keenan said council was applying for a grant to undertake an Urban Renewal Study of the site.

"This study will safeguard the site to keep any future use in line with public expectations and best practice value," she said.

"It is currently zoned for community use and there are limitations on what it can be used for.

"Yarrawonga has two massive capital works projects about to start - the Yarrawonga Library and Community Hub plus the Multisport Stadium - at a value exceeding $15 million, and these are Council's priorities."

The approximately one and a half hectare old school site is located a block West from Yarrawonga's main street and its northern end has a view of Lake Mulwala, something Ms Henderson and Mr Campbell fear is appealing to developers.

Instead of high density living, the pair would like to see the site - which already hosts the historic courthouse, fire station, school building and tree memorial to soldiers who fought in WWI - put to community use.

It's been suggested the site be used for a larger Visitor Information Centre, a community hall, extra parking, art spaces or galleries, a museum, a 'Neighbourhood House', a green space, a venue for youth activities, a child care centre, an all abilities playground, a space for community clubs or for participating NDIS agencies.

Ms Keenan said council was aware of a native title claim to the site.

"It would be entirely inappropriate and unethical for Council to pursue lease or ownership of this property while this claim is being investigated," she said.

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