The former mayor of a council in Sydney's north has quit a key position in the local Liberal Party over claims his new job with a developer poses a conflict of interest.

After an ABC investigation, Steve Russell yesterday handed in his resignation as president of the Liberal Party's Hornsby Local Government Conference (LGC).

His decision came amid threats from a Liberal councillor in Hornsby to resign, claiming Mr Russell actively lobbied elected members on planning matters.

Mr Russell was dumped as Hornsby mayor in 2017 and had been consulting for at least three property developers with business before Hornsby council.

Until yesterday, he was also the president of the Hornsby Liberal Party's LGC, which is responsible for authorising pre-selections of Liberal councillors in the municipality.

Liberal elder Phillip Ruddock, a former long-time federal MP, succeeded Mr Russell as Hornsby mayor in 2017.

Ahead of Mr Russell's resignation, a Liberal councillor in Hornsby said he was prepared to tear up his party membership over his former colleague's dual roles.

State and Federal MPs face strict rules around using their influence for private interests, such as having to register as lobbyists, publicly declare meetings, and follow "cooling-off periods" between roles.

However, the same rules do not apply in local government.

'I don't need to deal with idiots'

The Lyon Group is in partnership to build this high-rise residential project on the west side of Hornsby's CBD. ( Supplied )

The ABC understands Mr Russell started consultancy roles with developers about eight weeks after being dumped as mayor in August 2017.

One of the companies he consults for is Lyon Group — which has significant property holdings across Hornsby and plans for high-rise residential developments near the area's CBD.

On the west side of Hornsby's CBD, Lyon Group is in partnership to build a high-rise residential project worth $170 million.

As part of a joint venture with property group Folkestone, Lyon Group recently made an unsolicited offer to Hornsby council for a towering redevelopment to the east of Hornsby's CBD.

That proposal includes building a new library, car park and civic centre.

Mr Russell said he had discussed these proposals with several Hornsby councillors in private phone calls and meetings.

When asked why he had met with some councillors and not others, Mr Russell said: "My time is precious to me these days. I don't need to deal with idiots."

Mr Russell said he had discussed his clients' proposals with senior council officials, including general manager Steven Head and Mr Ruddock.

The meetings were recorded in official diaries.

Mr Ruddock rejected any potential conflict of interest.

"I'm not commenting on those matters," he said.

"I mean they are matters for the party organisation, they make their decisions as they see appropriate."

A Hornsby council spokesperson said: "Council applies to Mr Russell the same appropriate protocols that exist for all constituents who approach Council."

Simon Longstaff, one of Australia's leading ethicists, said while consultants often operate under different rules to lobbyists, the same ethical issues arise for all former politicians.

"We can all play games with semantics around whether someone is a consultant or a lobbyist. It may matter as a matter of law," he said.

"But from an ethical point of view the core issue is, are you going into a public place and seeking to exercise influence either for your own benefit or the interest of private parties?

"It doesn't matter what it's called at that point. If you're leveraging on your public power from the past at that point, then you're violating an ethical norm."

'I'm not a lobbyist'

Despite the concerns, there was no evidence of any impropriety by Mr Russell, who was acting as a private citizen on behalf of his client's commercial interest.

Mr Russell denied he was a "lobbyist" and said he did not have a conflict of interest.

"I'm not a lobbyist, I'm giving them [Lyon Group] a bit of advice," he said.

"I'm a consultant."

Mr Russell said he had not tried to influence any councillors.

"What I was trying to impress upon them [Hornsby council] is they have an opportunity at the moment, which may not be there forever, to get some facilities for the community in a pretty good deal," he said.

"I've just said, 'there is a window of opportunity there, which may close at some stage and if it closes then it is a shame because it will be lost to the community forever'."

A proposed development to the east of Hornsby's CBD, which would include a new library, car park and civic centre, is a joint venture between property group Folkestone and the Lyon Group. ( Supplied )

A set of voluntary Independent Commission Against Corruption (ICAC) guidelines are available as oversight for potential conflicts of interest in local government.

While some councils, such as Strathfield and Canterbury-Bankstown, have embraced transparency measures developed by ICAC many like Hornsby have not.

At Hornsby council's last meeting in December, Greens councillor Emma Heyde called for those guidelines to be recognised and implemented.

The motion was not carried and instead deferred to a councillor workshop.

"If we are to keep and maintain public confidence there should be no more cosy chats over coffee," she said on the night.

"No more private meetings of which other councillors aren't even aware, let alone invited."