The Commercial Dispatch reports the Historic Preservation Commission had planned to seek a 50-50 matching grant of up to $10,000 from the Mississippi Department of Archives and History's Historic Preservation Division to set up and administer the district.
However, they decided not to apply after determining they could not obtain the financial backing for their portion of the match, city planner Christina Berry said.
Berry said preservationists had hoped to receive funds from the Columbus City Council, but the request was not included in this year's budget.
"Once community support and involvement is garnered for this project, it may be a viable project for city funding," she said. "It, however, would have to meet council approval."
The district's proposed boundaries would have been College Street, Mississippi University for Women, the railroad tracks and the Tombigbee River.
Problems arose when the commission learned the maps under which the district was originally created would have to be redrawn.
If the ordinance had passed, the commission would have been able to require approval for future structural modifications, making sure all changes were in keeping with the structure's original era.
Structures in the area include a variety of architectural styles, from antebellum mansions and Victorian homes to World War II-era bungalows. The area was listed in the National Register of Historic Places in the early 1980s.
The proposed ordinance is likely to be revisited at a future date.
"We don't want to just abandon that hope of an established Southside district," commission member Rachel George said.