The new plan was approved at the December ordinary council meeting on Wednesday night, and all councillors were in support of it.

It comes after numerous concerns from locals were submitted earlier in the year, which prompted the masterplan to be changed.

The councillors had much to say in support of the plan.

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Mayor Jamie Chaffey said the plan would "respect the heritage of the town and change the way our community will meet and interact in the future", while Cr Murray O'Keefe said it was a "masterful masterplan".

"It's a pleasure to be part of council and able to support and approve something that's been a long journey and has got a good result," Cr O'Keefe said during the meeting.

Cr Colleen Fuller echoed his comments.

"As part of that committee I'm pleased to see it go ahead," she said.

"A lot of work has gone in ... and we think it's a great thing."

They also voted in favour of allocating $60,000 for a cost benefit analysis of the project. This will be done before further stages of the project commence.

This analysis will cover at a minimum: justification of the proposal; assessment of the council's capacity to deliver the project; determine the priority of the project in relation to existing capital commitments and future works; consider the full range of project alternatives, financial implications and whole-of-life costs' and public consultation process.

Once this is done, the first stage of the project will be to demolish the existing Smithurst Theatre, including the stage, change-rooms and kitchen. The commercial kitchen fixtures and fittings will be salvaged.

The precinct is set to feature a courtyard, foyer, new library, community function rooms, a new town hall, arts centre, and possibly a new Visitor Information Centre (VIC).

The decision on the location of the VIC will be made at a later date.

A new second cinema was also included on the original masterplan, but this has been removed. Options to create an audiovisual room as part of the new library may be explored in the next stages.

The project, estimated at $14,635,026, has yet to be funded.