The gallery's request for council to subsidise its building insurance and land rates ($8000) and pay for a full-time art director (approximately $85,000, including superannuation) was knocked back at council's August 21 meeting.

Gallery treasurer Brad Fenning said it was not an unreasonable request, considering the support nearby councils - including Maitland, Muswellbrook and Lake Macquarie - give to their art galleries.

Council agreed to extend the art gallery's lease agreement - which includes free rent in the council-owned building - for a further 12 months.

But it rejected the gallery's funding plea on the grounds that it was not included in its 2019/20 operational budget, and it would therefore have to redirect funds from another project area.

Mr Fenning said offering the new lease will be a "waste of time, as the gallery is not in the financial position to be able to commit to it".

"If council believes it is important for Cessnock to have an art gallery, then they either need to support the current volunteer-run gallery, or do what other councils do, and run one themselves," he said.

The gallery relies on sponsorship, donations, membership fees and fundraising to cover its operating costs of approximately $36,000 a year.

Mr Fenning said the gallery's fundraising efforts haven't proven as successful this year as in previous years, and some businesses have had to pull their sponsorship.

"It's hard to get money at the moment, not just here, but everywhere," he said.

He said they could consider crowdfunding, but gallery chairperson Katrina Rose said she will be stepping down regardless of the outcome, as she is planning to refocus on her art career.

Ms Rose said she believes the gallery can be saved if the council will fund it and employ an art director.

"It needs someone in a paid position to run it," she said.

"No-one else is willing to make the sacrifice for what is essentially a full-time volunteer role - it's not sustainable."

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Council is currently investigating the establishment of a cultural hub at Cessnock Performing Arts Centre, which may include art spaces, and has engaged an architect to provide concept designs.

It voted to investigate opportunities for the co-location of cultural facilities within its existing cultural and arts-related services and facilities as part of its 2017-18 operational plan.

While the council's current position is to not to provide additional financial support to the art gallery for operational purposes, it has given the gallery in-kind and financial support on a number of occasions since it opened in 2009.

Council bought the building in 2010, and the adjacent carpark two years later (a total investment of $700,000), and currently provides the building to the gallery rent-free (which would be estimated at $35,000 a year).

The council's most recent financial contribution to the gallery came in 2013, and the gallery closed briefly in 2015 after a funding request was knocked back, but resumed operations later that year under a fully volunteer-run model.

The gallery has more than 4000 visitors a year, hosts 12-to-14 exhibitions by local and travelling artists, and hosts art classes for children and adults.

Ms Rose said it would be sad for Cessnock's creative community to lose the gallery.

"It's the loss of opportunity for over 100 artists to sell their work and sustain their incomes," she said.

"The camaraderie of the artists has been brilliant, and the opportunity to expose themselves, for an artist that's incredibly important, to validate who they are."

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