The NSW government will be required to release documents about the future use of Tomaree Lodge within 21 days.
The former disability centre, located at the Shoal Bay headland, has been empty since it was closed more than two years ago.
The community has called for the nine-hectare waterfront site to be repurposed, with suggestions include a marine research centre, museum, visitor information centre, and restaurant or cafe with oyster-tasting tours on the side.
Labor agreed to release the community consultation outcomes report about the future use of the historic site, following a motion by independent politician Taylor Martin.
Mr Martin said the government had refused multiple calls to release the documents and the decision was a win for the Port Stephens community.
The Community Consultation was undertaken by the former Coalition Government, however was not finalised prior to the 2023 state election.
The report was completed in April 2023 and handed to Families and Communities Minister Kate Washington in May last year.
"Locals have been extremely patient waiting for progress to be made and it is good news that we will finally be able to see the results of the community consultation," Mr Martin said.
"I will be maintaining a watching brief regarding the future use of Tomaree Lodge and I expect the Government to act in a timely manner."
The Newcastle Herald reported in November that the state government was spending $1 million a year on security and maintenance at the disused disability centre.
Environment Minister Penny Sharpe indicated the initial round of community consultation held little weigh, because it "was not well designed and did not account for any constraints on the site, which are considerable".
"Therefore, more meaningful community consultation will be required to determine the future use of the site," Ms Sharpe said.
Tomaree Headland Heritage Group, which represents a host of business and community organisations in Port Stephens, has called on the government to hasten a decision on the site's future.
