Mrs Hyam spoke to The Argus about the deal after it was accepted by councillors at their last 2011 meeting.

State government officials approved the $1.3billion coalmine expansion with a condition requiring the development company, Xstrata, and the council to establish a “voluntary planning agreement”.

The deal is understood to be the first of its kind in New South Wales.

Mrs Hyam said company representatives initially offered $1million but, after about five months of negotiations with council staff, this was increased to $4.3million.

The figure includes $1.5million for community facilities and $41,000 a year for the mine’s 20 year life, to compensate for damage mine vehicles will have on local roads.

It also includes $100,000 a year for the mine’s 20 year life, for the maintenance of council-owned capital works, as long as the pit “is making a profit on earnings before interest, tax, depreciation and adjustments”.

Several councillors questioned the deal and deputy mayor Paul Nichols summed up by saying: “My big concern is that we are selling Singleton for $4.3million for the next 20 years and that’s not enough.”

A report to the meeting by acting assets director Alan Fletcher recommended councillors approve the agreement.

His report said in part: “The outcome of the proposed voluntary planning agreement will provide positive social benefits as a trade-off for negative impacts of the mine.

“The intent is to contribute to achievement of the social values of the local government area.”

A workshop is expected to be held before the end of this month so councillors can pick community projects they believe the deal’s initial $1.5million should cover.

The list of projects will be advertised for public comment.

In a meeting with The Argus after councillors accepted the $4.3million deal, Mrs Hyam said it should be viewed in a broad context.

Xstrata had already contributed a lot to the Singleton community, she said, including $500,000 to a youth centre, $500,000 to the town’s visitor information centre, $200,000 to the regional rural fire service at Bulga, $200,000 to an all-abilities playground, $170,000 for Hunter Prelude’s out of school care plus a variety of other sponsorships and incentives.