Cr Fay Hull moved that Council explore possibilities for the lease and management of the Green Hill Lake Reserve, or part of the reserve, which will leave the management to a body which may wish to develop the reserve as a caravan park or have it remain a simple camping ground.

Council received a report on possible options for the future management of Green Hill Lake and funding options at its last meeting from the director of council services Neil Manning.

Mr Manning said the Green Hill Lake Reserve currently provides a minimal camping service and boating and fishing to campers and casual visitors.

Council is the Committee of Management for the crown land reserve under the Department of Environment and Primary Industries (DEPI) and is responsible for the day to day management of the reserve, including the waterways management for the lake, while the Green Hill Lake Development Board is an independent community group with a particular interest in the reserve.

"Council has been negotiating a Memorandum of Understanding with the Green Hill Lake Development Board, who undertakes a number of maintenance and supervisory tasks, including such things as mowing, minor cleanups and provides a presence at the reserve that ensures good order," Mr Manning said.

"Council is interested in formalising the role of the Green Hill Development Board through a MoU that sets out the responsibilities of Council and the Board. The Green Hill Lake Development Board advises Council on new initiatives and is the main driver for improvements and development.

"These new initiatives include such things as the new children's play area.

"The Green Hill Lake Development Board has for some time accepted donations from visitors to help fund their activities and this has been their sole income used to fund new initiatives and maintenance.

"Some very vocal visitors have seen donations as incompatible with Council's long stated position that the Green Hill Lake Reserve is a free camping area where no camping fees are levied.

"From time to time this has erupted into a slanging match in the local press."

The report to Council offered a variety of management funding options including: Relinquishing its committee of management status, establishing a formal caravan park and leasing the reserve to another party.

Mr Manning said the option of leasing the reserve would allow another party to have day to day control of the reserve or a specified area of the reserve.

He said the lessee would be responsible for all maintenance and upgrades within the lease area while council would remain responsible for the waterway.

The lease arrangement could take several forms:

* Leased to an incorporated community group such as the Green Hill Lake Development Board.

* Leased to a Caravan Park operator.

Mr Manning said if a lease to a caravan park operator eventuated it would be then in the control of the lessee to establish and maintain a caravan park or operate the area as it sees fit.

The lease agreement would establish the parameters and performance required but any lease agreement would need to be agreed to by DEPI.

Mr Manning said the leasing of land for camping and caravan park uses is a common practice in many shires in Victoria and depending on the need for private investment in caravan park infrastructure the lease could be set at peppercorn or a market rent.

"If, for example, the Green Hill Lake Development Board were to become the lease holder then they will be required to operate wholly within the law," Mr Manning said.

"This would mean that if they wished to charge camping fees then they must operate within the appropriate acts and regulations and be prepared to manage the associated risk. It should be noted that since the changes to the Caravan Park Regulations the management of risk has increased importance.

"Individual members of the Board may become individually liable if identified risks are not managed appropriately. A risk once identified becomes an obligation to rectify. If a fire occurred at the Green Hill Lake Reserve and the appropriate fire services and emergency management plans were not in place then it may be deemed negligence on the part of the lease holder."

In speaking in favour of the motion Cr Fay Hull said the issue of the management of Green Hill Lake had been continuing for sometime.

"It's probably appropriate that we recognise the importance of the Green Hill Lake area to the community and this gives us options to perhaps improve it in the future and have some sort of certainty for the way it is managed and what options we have for improving it as a community facility," Cr Hull said.