Business South chief executive Mike Collins said he supported a proposal to set up an independent organisation outside Dunedin City Council operations to take over Enterprise Dunedin.
Businesses had lost opportunities and been "significantly" impacted by uncertainty about the agency’s future, and Mr Collins called for a "clear decision" to be made this week.
"You can’t really kick the can any further down George St.
"We just really need to make a decision and get on with it."
The council had been expected to choose a new model for Enterprise Dunedin by Christmas.
A report to be tabled at a council meeting today offered two options for elected members to consider, but no clear staff recommendation on which to adopt.
Business South’s preferred option is to create a new council-controlled organisation (CCO). The other option is an "enhanced in-house model" that would retain Enterprise Dunedin as an internal unit of the council.
Mr Collins said Enterprise Dunedin was "really hamstrung" by being run in-house by the council, the model lacking agility and commercial accountability.
Investors and businesses did not generally invest into local government — but they would invest in an independent organisation, he said.
"If we really want to move the dial on growth and remove the reliance on ratepayers funding economic development, the only way to do it is to move it out and create new investment into the city."
If the agency was kept inside council, the city would not be able to respond fast enough to the challenges in front of it — such as meeting the demands of student accommodation.
"There are investors out there who want to invest in Dunedin, but they won’t come in here and invest in it, from an economic development perspective, unless we’ve got ourselves in order."
Dunedin Mayor Sophie Barker said nine councillors went to Invercargill on Tuesday to meet members of Great South — the regional development agency for Southland — and the Southland District Council to learn about and compare in-house and CCO models.
Councillors would consider options around Enterprise Dunedin "very carefully", Ms Barker said.
"I completely understand the frustrations from our business community.
"I am committed to working positively with all our partners on a fit-for-purpose vehicle to deliver our economic and community goals," Ms Barker said.
An email to councillors which Ms Barker forwarded to the Otago Daily Times said the visit was partly "to learn more about how a leading economic development agency works, their structure, how their vision and strategy have been created with their partners and how they execute it".
The visit was also to understand opportunities for Otago and Southland to work together, build partnerships with southern colleagues and to "look at an example of good practice and help start the thinking process around our city vision, masterplan and strategies", the email said.
The report to councillors said the large majority of Enterprise Dunedin’s funding — 94% in 2024-25 — came from general rates.
