The Saltdean Lido CIC (Community Interest Company) needs £70,000 to meet the costs of a new electricity sub-station at the site as part of its £10 million renovation.
The council told the CIC that it could contribute about £10,000. It believes that the CIC could contribute about £50,000 from its reserves.
But the CIC’s chair, Rebecca Crook, said that this meant the entire project was on hold as the group did not have enough funds to cover the total cost.
Mr Kirby said: “Having worked closely with the CIC and local residents over the last five years and helped lobby government for substantial funds to make the Lido a reality, I urge the council to do all they can to assist at this crucial stage.”