The Southland District Council has backed a proposal to try to make an airport it owns financially viable and sustainable.

Te Anau-Manapouri Airport has been running at a loss since inception and the council is looking at changing how its operating expenses are funded.

In the past five years, that operating shortfall has been between $217,000 and $318,000 for each year due to low passenger numbers and high costs.

The council considered a report examining the airport, its challenges and possible solutions to help it not only survive, but thrive during a meeting on Wednesday.

Those proposed solutions included the Fiordland Community Board repaying the airport's $631,797 loan by using its Luxmore subdivision reserves with another $171,000 being spent to fund an interim solution to make the airport more commercial, and offering longer leases at the airport.

The airport's operations are funded using lease and rental income, fees landings, ground handling and park landing with a targeted airport rate for those in the Fiordland area funding the balance.

The report recommended the council changes this and consider funding all or part of the future airport operating costs from a district-wide rate that covered 30 percent, 50 percent, 100 percent, or potentially less than 30 percent of those costs.

That would translate to a fixed amount per household - rating unit - of $2.76 using 30 percent to $9.22 applying 100 percent.

The council agreed to consult residents about potentially using a district-wide rate, accept the report's recommendations to allow the airport to become more commercial operation and, in a separate paper, to appoint Great South to do that work - but neither received unanimous support.

Councillor Don Byars said the airport should be considered a liability, not a strategic asset given the amount of money that had been poured into it.

"That community is on the hook for a lot of money. What you're proposing here is that we spend a lot more money."

"There's no light at the end of the tunnel here. It's just more money disappearing into a big hole. The entire district is already well served by two airports."

Mayor Rob Scott said the airport had been acknowledged as a liability, but this was an opportunity to change that.

"A lot of people have said that and the purpose of this approach is to turn it into an asset and looking at running it as a business."

Councillor Derek Chamberlain said he was tired of money being spent on reports.

"I think we've just spent $30,000 on a report that anybody to do with the airport could have pretty much told you for nothing."

Instead he questioned why the council was looking at unbudgeted spending to investigate setting up a council controlled trading organisation to run the airport, which would mean the airport would be managed with a commercial focus while the council still had oversight.

"It just needs bloody run properly and the sooner people start realising that and stop doing reports. I mean, this thing was bought back in 2002 and not a damn thing has happened.

"Get real people, just manage the damn thing."

Councillor Sarah Greaney said the airport had the opportunity to be a real asset to the community.

"That's what the community board saw very much as drawing a line in the sand to actually be able to go 'OK, yep, we will put our money where our mouth is and we'll actually repay the loan, get that out of the way so let's then start on a more level playing field."

Councillor Jaspreet Boparai did not agree with a district wide rate

"I would not be able to justify ... some in Ohai, Nightcaps - social deprivation level number 10, the worst off in the country that this is providing some concrete benefit to you."

Fiordland Community Board chairperson Diane Holmes told the councillors the airport has a lot of potential, but it has been hampered by "many, many years of a confounding, risk adverse, slow and unknowledgeable management".

"Imagine what it's going to be able to do if it's run well."

Councillor Paul Duffy said he was confident for Great South to take on this role as they were business focused and motivated.

Reproduced with permission