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Victoria will spend $1.45 billion on regional rail upgrades over the next four years - if the federal government hands over some disputed cash.
Labor's rail upgrades will mainly be built in safe coalition seats, but they need Canberra to agree to pay the full amount the state feels it was promised.
Victoria sold the Port of Melbourne lease for $9.7 billion and is due a 15 per cent bonus from the federal government under former treasurer Joe Hockey's asset recycling program.
"I really hope that we don't have to argue about this, we can just get on and get these upgrades done," Premier Daniel Andrews told reporters in Warragul on Sunday.
"Every single dollar that is needed for these important upgrades, it is Victorian money, it belongs to Victorians, it is subject to a written agreement."
The "Regional Rail Revival" upgrades will start in 2018 and create more than 1000 jobs.
But federal Transport Minister Darren Chester said Victoria missed the deadline for asset recycling funds, and he hadn't seen business cases for the rail projects.
"This would be a great announcement if it were true," Mr Chester told reporters.
"The money the premier is talking about is the subject of dispute between the state and federal governments."
Victoria argues it met the deadline, but Treasurer Scott Morrison did not respond.
Mr Chester said the he was willing to work with Victoria to get the rail upgrades built, but the state needed to contribute some of its own money in Tuesday's state budget.
Victoria's budget will include $10 million for planning towards a Melbourne airport rail link, which Mr Andrews said could be built using private money.
"I'm not convinced that this is something that should be 100 per cent taxpayer-funded," Mr Andrews said.
"I think there are great opportunities for partnerships with the private sector."
Mr Andrews also defended the need to raise some car and property taxes despite promising not to increase taxes before the 2014 election.
He said the increases closed loopholes that allowed people to avoid tax by putting properties in their spouse's name, and removed incentives for supporting the now-dead Victorian car industry.
Opposition leader Matthew Guy said the premier was "desperate" after ignoring country Victoria for two years and he was sending the bill to the prime minister.
This article first appeared on www.9news.com.au
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