Lake Macquarie councillors will vote on a motion to start community consultation over the renaming of Coon Island at Monday's council meeting.
The motion put up by liberal councillor Kevin Baker asks council to commence a consultation process with the community, including the Local Aboriginal Land Council, to investigate alternative names - including potential dual naming opportunities for Coon Island and Coon Island Point at Swansea.
Following consultation, council would then consider the possible renaming.
Cr Baker's motion also calls for councillors to be briefed on a proposed timeline for consultation and reports to both council and the Geographic Names Board, which would have final say on the renaming.
The island is named after Herbert Greta Heaney, who lived on the island for many years and was nicknamed "Coon" because his face was often covered in coal dust.
In his notice of motion, Cr Baker said the names of both Coon Island and Coon Island Point were "inappropriate, as they represent a racist slur against some members of our community".
"While we need to recognise our past, we also need to identify things that are not right and rectify them," the motion says.
"These names are not inclusive of all members of our society, and should be relegated to the history books.
"It is suggested that our community would be better served by investigating a more appropriate name to reflect our modern society, including the possibility of dual naming of these places in consultation with our Aboriginal community."
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