Some residents in the area claimed their patch had no community of interest with Clutha and should become part of the Dunedin City Council, but a petition, signed by 14 of them, was not enough to convince the commission fresh lines needed to be drawn on the map.
In a brief statement, the commission said the proposed reorganisation, as suggested by the submitters, "would not promote good local government of Clutha district or of Dunedin city".
It also ruled residents would continue to use resources "on both sides of the boundary as part of their everyday lives" and doubted altering the boundary would change the pattern of people's lives.
Changing the boundary lines would be "unnecessarily disruptive and achieve little", its findings said.
While the Clutha council did not formally oppose the move, it told a hearing last month it would be unhappy to lose the area which could one day contain TrustPower's Mahinerangi wind farm.
Losing that ratepayer could see its rate take drop by $50,000 annually.
Petition organiser Robert Reid could not be contacted yesterday.
Clutha Mayor Juno Hayes said he was "absolutely delighted" common sense had prevailed as the proposed change would have seen no real benefits.
"There were only 14 petitioners of a total population within the proposed boundary change area of about 130 so there was hardly a mandate for change.
"I am most pleased for those remaining ratepayers in the Lawrence-Tuapeka ward who would have faced rates increases had the boundary change gone ahead."
Each ward household would have paid an extra $23 in rates while all rateable properties in the district would have had another $3 added to the uniform annual general charge, Mr Hayes said.
"The status quo is clearly in the best interests of local government and we're very pleased with the outcome."
There was a suggestion at the hearing the move by petitioners was linked to the Clutha council granting resource consent for TrustPower to build a wind farm at Mahinerangi.
But the commission did not accept that, calling the wind farm debate "an extraneous issue".
It also believed many other Clutha residents, not just those in Mahinerangi, would take advantage of their proximity to Dunedin city to use its services and facilities.
"We believe that residents will continue to use resources on both sides of the boundary as part of their everyday lives and doubt whether altering the boundary would change the pattern of people's lives.
"Nor do we find the interests of the proposers to be distinctive enough from those of other rural dwellers elsewhere in Clutha district."
The commission also went into bat for the Clutha council which petitioners criticised at the hearing for providing few services to ratepayers in that part of the district.
