Mr Paterson said: "Whilst it is acknowledged that there has been a technical breach of the resource consent, there are no adverse environmental effects generated by the flying of the black flag.
"It is for the council, as regulator, to determine what, if any, enforcement action it will initiate.
"As chief executive, I have determined that no enforcement action will be taken against the consent holder."
Mr Paterson confirmed these comments to the Bay of Plenty Times through a council communication spokesperson.
Mr Harlen was "extremely disappointed" with this response and said there should be one rule for all, not one rule for the council and another for everyone else.
"It's the end of the wedge. If the council can turn a blind eye to the conditions on their own resource consent then what's stopping them from turning a blind eye to other resource consents," he told the Bay of Plenty Times.
When the Bay of Plenty Times phoned Mr Paterson yesterday, he declined to comment further.
Long-time Tauranga resident John Mitchinson said he was disappointed the council was not supporting New Zealand with the correct flying of the national flag.
"I'm not against the black flag. There is protocol they must follow and [the black flag] is not our national flag and should not be flown on any civic buildings or the flagpole."
To follow protocol, Mr Mitchinson said the New Zealand flag needed to be flown at the top of the flagpole and the black flag beneath it.
His main concern was the lack of New Zealand national flags flying around the city, on council flagpoles or building windows.
"As far as I'm aware, the RSA in Greerton and one in Gate Pa are the only flags flown in the city, and I don't think that's good enough.
"Yeah, I'm absolutely pissed off because we're the fifth largest city and this city is not supporting New Zealand thorough the Rugby World Cup.
"We've got over 100,000 visitors to this city [through the World Cup] and I think it's disgusting we're not showing our support. I just don't think it's good enough."