Under the levelling up proposal for Halesowen, the outdated Pool Road multi-storey car park will also be demolished.
If the bid for Government cash is successful there will also be additional car parking created in the town centre, improved cycling lanes and a new entrance for the Cornbow Hall, in Hagley Street.
Others improvements will including landscaping and work to open up pockets of the town centre.
The council has been working with key partners in the scheme, including Halesowen College, Halesowen Business Improvement District and Halesowen and Rowley Regis MP James Morris.
Dudley's regeneration boss Councillor Simon Phipps said: "This is another significant investment in one of our town centres which will add to the one billion pounds of regeneration already underway elsewhere in the borough.
"We are talking about improving education facilities in the town in line with our commitment as a child-friendly borough and supporting people to find alternative ways of travelling to the town centre by improving cycling links.
Of course, with the loss of the multi-storey car park we will be looking at replacing those car parking spaces to make sure people can arrive by car if they need to.
I am really excited to be working with key groups in the town to make this project happen which will really enhance this town."
The ambitious bid will be submitted in July.
The Halesowen plan includes 75 new car parking spaces in Andrew Road, improving cycle lanes in Queensway and other routes. There are also plans for more car parking outside Halesowen Leisure Centre, in Great Cornbow.
The proposals for Halesowen will be subject to the successful bid and future planning permissions, but the council owns the land included in the proposals.
The cabinet will discuss the scheme on June 27.