The uniformed youth group has raised the cash to build a prefabricated unit but Blackburn with Darwen Borough Council's planning rules mean that the group can only use it for a maximum of five years.
Lieutenant Gavin Redhead, commanding officer at Blackburn Sea Cadets, described the process as "ludicrous".
"At the moment the application has stalled," he said. "The council is saying it wants a brick-built building for it to be permanent and we have to foot the cost of this. If they want us to go down that route then it's going to cost another £30,000 at least. My view is the council should support us rather than just say 'no, you can't have that kind of building'. We've got the funding, got permission from the Ministry of Defence and then we come up against this."
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