A funding bid to build a new gypsy and traveller site in Plymouth needs to be submitted as a "matter of urgency", the city council leader has warned.
Plans for the facility in Plymouth can now go ahead after opponents to the scheme were defeated at an emergency council meeting on Monday night.
But a detailed grant application for the site in Efford needs to be submitted to the government by June.
Councillor Vivian Pengelly said the cash could be lost to rival councils.
Ms Pengelly said: "There's only one ring-fenced pot of money for the South West and if we don't get a share of it then it will go to other councils.
"The government has the power to force gypsy and traveller sites on us.
"If we don't get our bid in, then local council taxpayers could end up footing the bill for sites which have been imposed on them."
She said the gypsy and traveller accommodation issue caused "considerable" social tensions in Plymouth.
About 14 Labour councillors walked out of Monday night's emergency council meeting after their attempts to halt the debate about the proposed Military Road plot failed.
They said the plans were being "railroaded" through the council and there had not been proper consultation with local residents.
Labour's Peter Smith said: "We will fight these proposals all the way."