Finance Minister Bill English and Transport Minister Simon Bridges have written to Mayor Len Brown saying the Government is unwilling to consider motorway tolls at this time.
The ministers said the council's transport strategy does not provide a compelling case for additional transport investment.
"The proposed additional investment is expected to only deliver modest improvements in the areas that matter most of Aucklanders - tackling congestion and driving greater public transport use.
"We are therefore unwilling to consider new transport funding tools that would increase costs for Aucklanders and the overall economy at this time," the ministers' letter, dated May 26, said.
They proposed that Auckland Council and the Government work together to identify a 30-year strategy for the development of Auckland's transport system.
"An agreed transport strategy and package of projects that addresses both the Government and Auckland Council's transport objectives and sets out a compelling case for additional transport investment is a prerequisite for any Government consideration of additional funding or funding tools," the letter said.
A statement from the mayoral office - Mr Brown is leading a business delegation to the United States - said the mayor welcomed progress in his discussions with the Government on identifying a transport accord for Auckland.
The mayor's office, Auckland Council and Auckland Transport staff have been working with the Ministry of Transport and New Zealand Transport Agency (NZTA) officials to arrive at a common view on what form such an accord would take.
"Len Brown says he will respond positively to the Ministers' request that elected members and officials now begin to finalise arrangements to advance the accord. That process will clarify the areas already agreed on and advance discussion on the areas where positions differ in terms of timing, the effectiveness of different options for transport investments and how investments are to be funded over the long term," the statement said.
Mr Brown consulted Aucklanders on the options of a motorway toll or a fuel tax and higher rates as part of a new 10-year budget.
Aucklanders expressed a preference for motorway tolls, but a consistent refusal by the Government to approve and pass legislation for alternative funding tools at this stage has left the council high and dry.
In the absence of new funding options to fill a $12 billion funding gap over three years and transport cuts in the budget, Mr Brown introduced an a interim targeted rate of $114 for households to top up spending on transport.
The targeted rate, which some councillors say was buried in the budget documents and not clearly signalled, has contributed to an average rates rise of 9.9 per cent for households from July.
The council last month voted for a 2.5 per cent rates rise. The targeted rate was equivalent to a further 4.4 per cent rates rise, and new valuations and a plan to lower business rates mean the average household rates increase is 9.9 per cent.
Auckland Chamber of Commerce chief executive Michael Barnett said he strongly supports the initiative of Government to seek a negotiation with Auckland Council on an agreed 30-year programme focusing on reducing congestion, and boosting public transport where that reduces congestion.
"The Auckland business community overwhelmingly agrees that immediate action to address the City's transport congestion is required," said Mr Barnett.
He said it is very clear that current plans are not making a significant difference to congestion. A good outcome from Government and Auckland Council working together would be a package of fast-tracked projects aimed at:
- Improving public transport services' reliability and frequency.
- Getting as much use as possible out of the transportation system we have.
- Removing parking from major arterial routes to create more usable road space.
- More high occupancy lanes to encourage a reduction of sole occupancy cars.
- Strengthened integrated traffic management covering arterials and motorways.
- Expanding park and ride facilities at main trunk rail and busway stations