Whitby Town Council has decided not to be a government guinea pig for a new planning law.
The Government wants to find 12 communities to trial Neighbourhood Plans in advance of the new Community Bill becoming law next year.
But at a meeting of the full council on Tuesday councillors snubbed the idea.
In a statement to the Whitby Gazette the council said: “For the past few years Whitby Town Council (WTC) has wanted a Whitby Town Plan which truly reflects the wishes of most Whitby residents.
“This new community planning pilot scheme sounded like a good opportunity, but WTC has since found out that there are many conditions attached to the £20,000 on offer.
“This government money would actually be provided to Scarborough Borough Council (SBC) to support the Whitby volunteers both councillors and local community.
“The Neighbourhood Plan would also have to be completed in record time and it must comply with the current centrally-imposed Regional Housing Allocation of building over 1000 new dwellings within Whitby.
“WTC decided it would be better to wait until the new Communities Act becomes law in a year’s time, when the housing targets will be scrapped and SBC will have a new duty to help the Whitby community develop its own Town Plan.
“Whitby Town Council wants a Town Plan which truly reflects the wishes of the majority of Whitby residents and will continue to work towards that.”
At the meeting, councillors argued that most Whitby residents are more concerned about protecting the existing town and providing more affordable housing, rather than any major new developments of open market housing.