The developer of the former RAAF base will be credited more than $5 million from Dubbo Regional Council.
Council has agreed to enter a planning agreement with Andorra Developments. It recognises the work undertaken by the developer that benefits the wider community.
The credit includes more than $2.6 million for the provision of stormwater infrastructure and $611,000 for constructing traffic lights on Cobra Street.
But council's director development and environment Stephen Wallace said the planning agreement was unrelated to the application for a new Bunnings.
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"Council is in the process of assessing a development application for a Bunnings Warehouse but the planning agreement is not related to that application and I would stress to the community that the DA for a Bunnings Warehouse will be assessed separately on its merits," Mr Wallace said.
"The two matters are very different and the planning agreement as proposed in no way endorses or disapproves of the DA for a Bunnings Warehouse."
The application is for a $30 million warehouse that would be 68 per cent bigger than the current Bunnings on Sheraton Road.
Councillor John Ryan also raised concerns that the two issues would be merged in the community's mind.
"It worries me that people in the community will have the wrong idea of what this is," he said.
"What this is is about a nearly 100 acre slab of land in the centre of town and things the people who are developing it are doing that will provide benefits to the community. That's all it is. It has nothing to do with any specific thing that may go onto that site.
"I urge people when they're looking at these sorts of things to read carefully what the issue is about and not read things into them that aren't necessarily there."
The planning agreement was one of the development application conditions for the site's three-stage subdivision and master plan. It had to be finalised before the first subdivision certificate.