Camden residents will no longer face higher council rates over the next financial year.
Councillors voted against a special rate rise at last night's council meeting.
Camden was one of 14 Sydney councils to seek a special rate variation in order to fund its urban renewal program.
However councillor Lara Symkowiak said the projects listed in the urban renewal program should be funded using the council's budget surplus funds.
"After talking to people and hearing feedback my feeling is that there are a lot of people doing it tough," she said.
"People are feeling the pinch - it might only seem like a small price rise but every household is feeling it.
"I saw a news report that said Mount Annan was one of the most mortgage-stressed areas in the state."
The rate increase would have worked out to be about an extra 79 cents per week, or an extra $41.25 each year.
Projects under the planned urban renewal program included Leppington Station Road improvements, Catherine Fields Reserve ground and building improvements, Kontista Reserve seating and pathways, Liquidamber Reserve car parking spaces, The Cascades, Mt Annan park improvement works such as seating, bridges and bollards, Jack Nash Reserve playing surface and ground improvements, Camden Civic Centre building and interior upgrades, Kirkham Park BMX amenities and renewal of the heritage gates at Onslow Oval.
Cr Symkowiak said the council had returned a budget surplus each quarter for the past two years which could be used to fund these projects over time.
"I think the council should live within its means," she said.
"These projects should go ahead as a priority using any surplus funds we have."
Councillor Cindy Cagney said she was glad the rate variation would not be going ahead.
"My only concern is that these 16 projects will now be placed on the backburner," she said.
"I think it's a great leap forward not to raise the rates."
Camden mayor Peter Sidgreaves told the Advertiser last year that the "without the special rate variation some of the projects we have planned may never be addressed".
However at last night's meeting Cr Sidgreaves agreed with Cr Symkowiak's opinion.
"The only way to engage the community on these issues is to pass the recommendation we passed last time (to seek community consultation on the special rate variation," he said.
"The feedback that I received was that while this was a small increase people would prefer this not to go ahead.
"We have a fantastic list of projects and we can get these done using surplus budget funds.
"I am confident that we can deliver the projects on this list over the next 12 months."