Warnings of a $20 million write-off, and risk of judicial review were not enough to deter Hawke's Bay regional councillors from halving the possible ways the Ruataniwha Water Storage Scheme could proceed.

A Supreme Court ruling earlier this month was a major barrier in the attempt to secure access to Ruahine Forest Park land, which would have been flooded to create the $330m scheme, the largest irrigation project in the country.

Now, the council's investment arm, Hawke's Bay Regional Investment Company Ltd (HBRIC), is considering what could be proposed to secure access to this land - it is believed there are only two possible avenues to do so.

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However yesterday the council agreed it would tell the company that it would not support obtaining the land through one of these avenues, by compulsory acquisition under the Public Works Act.

This resolution was met with concern from some councillors - with Napier councillor Alan Dick stating it would be "the most important decision that has been made in this council term".

If it was passed, he said this would impair the investment on the project "so substantially that the reality is that the $20m will need to be written off".

"In my view it would be ... in terms of fiduciary duties, absolutely irresponsible to write down the value of a balance sheet by this amount."

The dam proponent also expressed concern the process of making the recommendation had been "faulty", and if passed could risk the council being challenged by judicial review.

"In my view if that happened, and there are a number of parties who would be concerned to bring that sort of action and take the regional council back into court again, the council would lose."

The recommendation had not been included in any reports before the committee, but was suggested during the meeting and had been voted against by three councillors.

Councillor Debbie Hewitt stated the resolution was "premature and reckless", while councillor Fenton Wilson said taking this option off the table now could prevent HBRIC, and the council doing their due diligence.

However the majority of councillors reiterated their intention to send a "pretty clear signal" on the council's stance of the PWA, and the scheme's future.

Councillor Peter Beaven said council should not contemplate taking the land that way, because it would be contrary to their primary purpose to manage the environment.

"If the consequence of that is writing down the asset because we didn't do our homework properly then that is the consequence, and we must live with the consequence."

He added taking this course of action could "seriously jeopardise" the council's future relationships with environmental groups - many of whom had fought the dam.

For some councillors the conversation has already turned to the future - Napier councillor Neil Kirton said the council needed to begin exploring alternative water storage strategies, and stop "flogging a dead horse".

Rather than continue to "dangle" the $60m slated for the dam, Hastings councillor Tom Belford said the council needed to figure out the best use of the money to advance other goals in the region.

It is understood HBRIC's advice may not be returned to the council until next month.