Councils have already this year used the Drought Communities Program to build up to $1 million worth of projects.

The Glen Innes Severn shire used the money to build a new bike and walking track, to hire a new GLENRAC drought support officer, for new toilets, a Deepwater water stand pipe, an upgrade to the heritage listed King George Oval grandstand, and the Rugged Bash event, among other projects.

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Some 128 local governments across Australia will have a second chance to access to the scheme. Each council is eligible for a million dollars care of the federal taxpayer.

MP for New England Barnaby Joyce long lobbied for an additional round of the scheme, calling on the extension while opening Glen Innes' final project funded by the scheme.

"In my former capacity as the Special Envoy for Drought Assistance and Recovery, I fought for and delivered this funding last year and am proud to see its continuation to help support our towns and communities in drought," he said today.

"Mayors from across the electorate have told me how well this assistance has been received by helping to prop up local business, support jobs and drive new wealth back into the New England which has been heavily affected by drought and more recently, bushfire."

The purpose of the Drought Communities Program is to stimulate drought-affected communities by employing locals typically on new capital works. The money cannot be given as direct support to farmers with eligibility criteria strict.

Minister for Drought David Littleproud said he wanted the program ready to go before Christmas, and hopes councils will get their applications in early.

"This will get projects off the ground sooner so drought-hit communities get the boost they need," he said.

"The program delivers more business for suppliers like local hardware stores and more jobs for their communities.

"In just over 18 months this program will have delivered $250 million to communities in drought. The program has already funded more than 300 projects, such as potable water supplies, tourist attractions and community events, and employed drought support officers.

"The extension of this program demonstrates that as the drought steps up, so does our response.

"These projects will provide an immediate economic boost so I urge councils to apply for funding as soon as they can."

Councils must finish their projects by December next year.