Nelson City Council is ending a heritage project at Founders Park - a decision it says it took to keep rates rises at a manageable level.
But a union says there has been a lack of transparency around that decision and the collection is integral to preserving the cultural heritage of the region.
The collection - which is based at Founders Heritage Park and overseen by Te Papa - is made up of items collected from the people and businesses of Nelson since 1986.
The council-funded Reorganisation Project began five years ago to make sure the objects were properly restored, catalogued and safely stored.
With a budget of about $1 million, it was not possible to keep the project going while making savings in other areas, chief executive Nigel Philpott said.
"Like all councils, we are faced with high inflation and interest rates and our starting point for the rates increase in the 2024-2034 Long Term Plan was as high as 32 percent.
"That's not a number I can realistically take to the Nelson community during a cost-of-living crisis, and staff have worked extremely hard to find savings across the board that have brought that figure down to 8.2 percent."
He said all affected staff had been offered other jobs, and the items would remain stored at Founders Park until the council was in a better position to do something with them.
However, the Public Service Association said ratepayers should be consulted on the decision to end the project, given the collection was made up of objects of significant local importance.
The project was critical in safeguarding Nelson's history, organiser Ian Hoffmann said.
For the past five years, the collections team had diligently undertaken the restoration, cataloguing, and storage of many of the items.
"There is a legal and ethical obligation for the council to act as stewards of these donated or loaned items, ensuring their preservation and accessibility to the public.
"The decision to mothball the collection jeopardises this obligation, putting both staff and the objects at risk."
Hoffmann said the union wanted Nelson City Council to reconsider its decision, prioritise transparency, and engage the community in discussions regarding the future of the heritage collection.
Residents are encouraged to make submissions on Nelson's long term plan before 28 April.