Councillors and stakeholders celebrated the start of works on the new Performing Arts and Convention Centre in Busselton.

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Works have begun on the new $38 million Performing Arts and Convention Centre in Busselton, after nearly two decades of planning and some community hesitancy.

Mayor Grant Henley and several city councillors met with Broad Construction builders and Rio Tinto executives on Wednesday to celebrate the first turning of the sod on the site.

Speaking to the crowd, Mayor Henley said that while the plans had come up against some "hurdles", the council looked forward to opening the new centre "on time and on budget."

The new centre is set to be built by Broad Construction, and will feature an auditorium with more than 600 seats, a traditional theatre, conference and banquet function rooms and a new A class art gallery that will be able to host international touring exhibitions.

The multi million dollar development was approved by the council in September 2021, at more than $10 million over what the City had budgeted in Busselton's long term financial plan.

The decision followed a community survey which found 53 per cent of respondents did not want the project to proceed, 43 per cent wanted it to go ahead and 2 per cent were unsure.

Mayor Henley assured the community in November that ratepayers would not see a 5 per cent increase on their rates as a result of the construction, which was a key concern for locals.

"We understand there is some community concern with respect to the cost of building a performing arts and convention centre, however the council believes now is the right time to proceed, with interest rates at a low level and with support of significant federal funding," he said.

A $10.35 million federal government grant was allocated towards the project in 2019, and Rio Tinto have committed $250,000.

The City may borrow an additional $11.7 million to proceed with the full design, which it says is a good option for funding at current low interest rates.

The City website says that proceeding with the full design could result in a 2 per cent increase on rates in the coming financial, however Council may spread this over multiple years.

A City of Busselton spokesperson said a performing arts and convention centre has been identified as a community need for more than 10 years, with successive councils supporting the concept.