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Queenstown Lakes District Council enforcement officers initially identified 55 homes in Shotover Country with unlawful fencing.
The subdivision's resource consent requires fencing to be less than 50% solid and made from certain materials. There are also height restrictions.
But that has been ignored by some homeowners. QLDC sent out an enforcement letter to them on June 2.
Council chief executive Mike Theelen said 43 of the homeowners were now working with the council to correct their fencing.
''The remaining 12 have yet to engage with QLDC and are not complying with the fencing requirements. As such, they were issued abatement notices last week.''
That could technically see fines issued to a maximum of $750 a day or prosecution.
But Mr Theelen said that was a last resort.
''QLDC will endeavour to keep working with all property owners to ensure compliance and avoid any fines if possible.
''However, if landowners make no attempt to co-operate with council there remains an option to issue further abatement notices, infringement notices, fines or possible prosecution.
''This is a last resort and something council hopes won't eventuate.''
Mr Theelen said the regulations were clear but council recognised fixing the fences would take time.
Some homeowners, shocked by the crackdown, sent an email to Queenstown Mayor Jim Boult.
It called for a public meeting and solutions on a case-by-case basis, with enforcement action placed on hold in the meantime.
''Council have a mandate to act in a fair and reasonable manner, using good judgement and discretion in determining the methods of enforcement and suitable penalties,'' it read.
The letter was said to represent ''60 Affected Shotover Country Residents'' but that could not be verified by the Otago Daily Times.
The letter criticised QLDC for acting on fencing but choosing not to enforce matters such as retaining walls and roof colours.
It also said the $750-a-day fine was ''extremely high'' considering the seriousness of non-compliant fencing.
Residents had concerns about the safety of children and control of dogs if they were forced to put more gaps in fencing, it said.
Mr Theelen said gaps and height restrictions allowed for ''a level of passive security'', encouraged a community feel, and looked nicer.
He said there were many options for the safe enclosure of young children and dogs.
''The majority of properties within the Shotover Country subdivision have been able to comply with the requirements.''