Plans for three park and ride schemes in York are uncertain, after the government announced the council would have to compete for funding.
Transport Secretary Philip Hammond said the £25m proposal was one of 22 local authority projects which would now have to bid for a £600m funding pot.
The scheme includes creating two new park and ride sites on the A59 and moving an existing site.
City of York Council said it remained "optimistic" it would receive funding.
The authority's transport bosses are asking for up to 90% of the cost of the project to be covered by the government.