Establishing Waimea Water and its governance structure would enable the
project to move rapidly once financial close is achieved, Kempthorne said.
"We cannot be accused of rushing the project with it starting in 2001 following one of the worst droughts on record. However, as the external funding we have managed to secure will not be available forever we need to get this project over the line," he said.
The dam has been controversial, in part because of its hefty $105 million price tag.
The council said the dam was the only option that would solve all the water supply challenges facing the council and community in one piece of infrastructure – urban water supply needs, horticultural water supply needs and declining river health with associated environmental, cultural and recreational impacts.
For that reason it was also the only option that attracted a significant amount of co-funding - $64m in direct funding and $18.7m in loans from irrigators, the Government and Nelson City Council.
The dam will hold 13.4 million cu m of water in the Lee Valley from the upper reaches of Waimea River. The dam operator will be able to release water in a controlled way when river flows are low to improve river health and recharge groundwater aquifers.
Nelson National MP Nick Smith, who has backed the dam, praised the council for its decision.
"This is a hugely positive decision for the future of the Nelson and Tasman region. It means a cleaner and healthier river, enables growth of our key horticultural industry and secures household water for the huge growth in Richmond, Mapua, Brightwater and Nelson South," he said in a statement.
Smith is sponsoring a local bill in Parliament that will allow access to the land where the dam will built.
It passed its second reading this week and Smith hoped it would get its third reading before Christmas.
