Goulburn Mulwaree Council have given conditional approval for a new men's hostel at 25 Market Street in Goulburn involving Kennedy House.
A consultative committee will be set up to keep key stakeholders informed such as the police and local business.
This comes after a member of the public raised fears the home would house child sex offenders.
Councillor Alfie Walker says the allegations were very serious and needed to be raised with higher authorities.
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