Central Hawke's Bay Council has dodged a possible $600,000 fine after being convicted of discharging a contaminant into the Waipawa River.

Yesterday the council appeared in the Environment Court for sentencing at the Hastings courthouse after pleading guilty to the discharge from the plant on Pourerere Rd.

The Hawke's Bay Regional Council prosecuted the council in November over a technical breach at the wastewater plant, which recorded six discharges containing E.coli, in excess of the five allowed exceedances over a 12-month period.

In court the two local councils were commended for reaching an agreement to divert ratepayer money from a monetary penalty to an independent review of the Waipawa wastewater treatment plant.

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An agreement between the two was yesterday commended by Judge Craig Thompson, who issued an enforcement order to review the plant as opposed to issuing a monetary penalty which could have reached up to $600,000.

The review decision was made to ensure steps were taken to fix the plant's problems in the long term, having particular regard to the fact that any costs associated with proceedings were ultimately borne by both councils' ratepayers, Hawke's Bay Regional Council manager of resource use Wayne Wright said.

Prosecutor Jonathan Krebs said the decision meant the two councils could avoid "scrapping it out" - a situation "unappealing in every respect".

Appearing via audio-visual link from Wellington, Judge Thompson said he was pleased to hear both parties had agreed to the terms of the enforcement order and thanked them both for their efforts to reach a resolution.

In an earlier court appearance the judge said he thought it was "futile and empty" for the two councils to be appearing in front of the court when they were representing the same group of ratepayers.

Along with issuing the enforcement order yesterday, he convicted the CHBDC and ordered the body to pay $7500 towards prosecution costs.

The enforcement order will see the council commission an independent review of the Waipawa plant and implement recommendations to a cap of $100,000 "within a reasonable time frame".

If the review recommends improvements that exceed $100,000 (including the cost of the review), the CHBDC will have to advise the regional council of its actions, including the securing of any necessary additional funding.

Mr Wright said yesterday's sentence meant the CHBDC was in a position to move forward with the independent review.

"We are very hopeful that the outcome of this will be that the situation will be remedied within the next short while."

Central Hawke's Bay District Council chief executive Monique Davidson said the decision allowed council to implement the recommendations of the review while remaining fiscally responsible.

"I wish to make absolutely clear that CHBDC is committed to ensuring that the Waipawa WWTP continues to comply with the limits in the resource consent conditions for the plant and, in that regard, is committed to taking seriously any recommendations made from the independent review."