"Again, we feel it would be inconsistent to be putting our effort in to such safety messages on the one hand, while on the other allowing the public to walk along the tracks."
Mr Bonser said the event had an enviable safety record.
"By memory there's only been a couple of sprained ankles and nothing at all major. It's been a very safe exercise. It's perfectly safe from being bowled over by a locomotive and the thousand walkers are treated as if we are a train.
"We have to have the necessary clearances and can't move on the line until it's clear and so on, and we're allocated the tracks for a certain number of hours, and we've conducted this event successfully and safely for 21 years."
There would be no appeal of the decision, Mr Bonser said, but Woodville Lions and event partners More FM "will certainly be going back and arguing it".
The community group next meet on Monday, he said, and a decision would be announced at a later date.
"The problem is it's an operational decision made by the KiwiRail board in Auckland and arranging ticket sales and advertising needs time. It's very, very unlikely the event will go ahead this year," he said.
"It would be hard, if not impossible, to replace (the walking event) particularly with these new health and safety regulations coming in to force. This might be indicative of what might happen in the future to a lot of volunteer fundraising events."
Mr Bonser said the Track'n'Tunnel Walk and a "motorcycle coast to coast" event were the major annual fundraisers for his group that together had raised about $500,000 over the past 20 years.
He said a third of the funds raised on the walk had been given to the Arohanui Hospice in Palmerston North, and over the past several years had donated about $12,000 annually to the hospice for equipment like special beds and infusion pumps.
Clive and Shirley Boyden, who helped found the event, were saddened organisations like the Arohanui Hospice would be denied charity. Mr Boyden said the demise of the fundraising event after more than two decades was lamentable.
"It is a really sad day for Woodville Lions."