A resurfacing project is set to restart "shortly" at Newtown's Gas Street car park after work paused just weeks after starting.
Powys County Council said: “As we come to the end of the financial year, and with budget and resource pressures post-Covid still causing challenges, we have had to prioritise finalising works on schemes across the county which rely on grant funding."
Work at the pay and display car park was expected to be completed within eight weeks by March 21.
The council also said that the contractor working on the project is waiting for ground investigation testing results to "ensure the disposal for certain excavated materials from the site is carried out correctly".
Powys County Council has yet to say when the work will restart and when the car park will reopen.
The car park is within an area represented by Action for Powys councillor Joy Jones. She has hit out at "completely false" rumours that the resurfacing works had stopped as a result of a lack of funding.
"The contractors will be back on site in two weeks," Cllr Jones said. "The contractors are off-site due to having to complete another project they have been doing which has to be completed before the end of the financial year."
Once completed, Gas Street car park will have a new rain garden to soak up surface water and an improved junction for pedestrians walking to and from the car park.
The car park will also have new kerbs, line markings and boundary posts.
Resurfacing work at the short-stay car park has faced some criticism from residents and local politicians when work began on January 24, after a row of cherry blossom trees were cut down for a rain garden.
The council has since apologised for the "distress caused" after removing the trees and have decided to plant new trees near the car park.
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