With a development application lodged, the next hurdles the Dorset Council faces in getting its North East rail trail shovel-ready is opposition groups and its neighbouring municipality.

The council plans to build a bike trail between Lilydale and Scottsdale, and a development application for about 26 kilometres of the estimated $1.5 million trail has been lodged.

It covers the rail corridor from Wyena to Scottsdale Railway Station, however, the remaining 14 kilometres planned for the bike trail sits within the City of Launceston council area and will be subject to a separate planning application.

In 2018 the Launceston council outlined its preference was for the heritage railway to run from Turners May to Wyena, rather than stopping at Lilydale.

This would result in a rail line being built between Lilydale and Lilydale Falls, or a separate train needed, as the line is broken in this section by a commuter path.

However, Dorset mayor Greg Howard said negotiations had begun on the DA with its neighbouring council.

Launceston mayor Albert van Zetten confirmed the development application process had been discussed with Dorset.

"We look forward to an application being lodged," he said.

"The council has previously outlined its preferences regarding the project, but any application will be assessed on its merits and go through the public planning process.

"As a planning authority, the council will then weigh any application against the criteria set out in the planning scheme."

The other hurdle Dorset faces is community opposition from the North East Residents and Farmers Tasmania group.

Chairperson Stuart Bryce said out of the 225 people who lived along the line, only nine were supportive of a bike trail and the rest wanted the heritage rail to run from Turners Marsh all the way to Scottsdale.

This is the vision the Launceston and North East Railway group put forward also.

Mr Bryce said members of the NERFT group would be putting representations in against the Dorset DA.

"We knew it was going to be lodged," he said.

"Mayor Howard has said all these people will come to ride it, but where are these people coming from? The Billycock Hill trail is hardly used, we set up cameras and during its busiest time, a nine day block over Australia Day, there was less than four riders a day."

LNER are planning a heritage railway from Turners Marsh to Lilydale, with a stretch to house a pedal-powered rail rider.

The group had hoped to at least extend the line to Wyena by sharing the rail corridor with the bike trail in the section from Lilydale to Wyena.