John Hood will meet Carad in Birmingham on 31 March

The council has refused to donate money towards the project in the Elan Valley to commemorate its flooding in 1904.

But city mayor John Hood has now agreed to meet Community Arts Rhayader And District (Carad).

Carad said the gesture was a reflection of the growing support for its plans in Birmingham.

Both the city council's leader and deputy leader have said the museum would provide no direct benefits to the people of Birmingham.

But since the city's stance was made public, Carad claims it has received dozens of messages of support, many of them from people in Birmingham.

We have had an amazing reaction from the people of the second city Peter Cox

The Elan Valley's six reservoirs send 360m gallons of water a day along a 70-mile pipeline to Birmingham and also to parts of south Powys and south Wales.

To reflect this link, Carad, the group behind the museum, had asked the council for a donation towards its cost.

Of the latest development, Carad's chairman Peter Cox said: "We are delighted the lord mayor has had the chance to consider how important this historic opportunity is to the people of Birmingham as well as to the people of Rhayader and district."

Coverage of the refusal on BBC radio and TV programmes Midlands Today and Radio WM prompted support for the Carad from Birmingham people, said Mr Cox.

'Quite happy'

Mr Cox added: "We have had an amazing reaction from the people of the second city by way of phone calls, e-mails and letters as well as by Brummies expressing their support for us through local television, radio and newspapers."

In a letter to Mr Cox, Mr Hood said no offence was intended by an initial letter of refusal from council leader Mike Whitby.

Mr Hood added: "However, to move the situation forward I am quite happy to meet with you or the mayor of Rhayader to discuss collaboration between Rhayader and Birmingham and how funds may be raised for the museum."