The money from the scuppered Maze/Long Kesh peace centre will all be reallocated to other projects within Northern Ireland.
It appears to kill off any lingering hopes of a deal on the controversial site for the foreseeable future.
The European Union body which administered its grant confirmed the funding was being reallocated, and said that while the Maze could apply to the Peace IV package, which opens for applications next January, decisions on funding would not be taken for up to a year. It means even if a deal is reached and a new approach made for funding, this would not be in place until 2016 at the earliest.
The signature building was designed by Daniel Liebeskind, the award winning architect responsible for New York's 9/11 Memorial. It was about to go out to tender last August when First Minister Peter Robinson dramatically pulled the plug on it.
Sinn Fein accused him of bad faith because the controversial centre had been agreed as part of the Programme for Government.
In October, the Special European Union Projects Body (SEUPB) announced that it was withdrawing £18.1m in grant aid. It emerged that the money would have to go back to Europe if projects could not be found to absorb it by the end of last year.
But an SEUPB spokesman said the money is in the process of being redistributed to a mixture of projects.
The DUP provided details of one of the projects to benefit from a £3.5m grant paid from the Maze money. It is the Voices Of The Valley project in Newtownabbey Valley Park.
The former Maze cash will help construct artificial all-weather 3G football pitches, a linear park and an adventure playground.
DUP MP Nigel Dodds and his wife Diane, who is the party's Euro MP, have been working behind the scenes for months to have the money reallocated to this project.
Mr Dodds predicted that it would create a new shared space for the community.
Mrs Dodds said the reallocation of all the Maze money vindicated Mr Robinson's decision.
Keeping the money here does not end the political stand-off with Sinn Fein.
Republicans could veto other developments on the Maze site. The only one it has committed to is the move by the Royal Ulster Agriculture Society from its old Balmoral base to the Maze.
A spokesman said "the development of the Maze/Long Kesh site is dependent on the development of the Peace and Reconciliation Centre and the retention of the listed buildings. We have made it clear there will be no further development until this commitment is progressed".
Alliance MLA Anna Lo said: "It does not reflect well on Northern Ireland that we have had to reallocate this money to other pro jects due to a political dispute."
STORY SO FAR
A planned Peace and Reconciliation Centre on the Maze Prison site was vetoed last August by Peter Robinson, the First Minister.
He said it hadn't enough support from unionist-leaning victims' groups.
It was funded by an £18.1m EU Peace III grant and there were fears that this money would have to be handed back to Europe if shovel-ready projects could not be found to spend it on.