The group was critical to the success of the Otago Regional Council's 6A water quality plan, Cr David Shepherd said.
Last month, dairy farmers told the council of daytime worries and sleepless nights thinking about rising rural rates, some aimed at improving water quality.
Several submitters at the hearings into the council's long term plan pointed out a stakeholder group not been set up. This was despite the council agreeing to establish it, during Environment Court mediation over the water plan.
One of several council committee meetings held this week confirmed the council aimed to set up the group quickly.
Cr Shepherd, who chairs the finance and corporate committee, said it was ''very important'' this happened. The council always intended to establish the group, he said.
The final membership of the ''stakeholder engagement group'' has yet to be decided, but it could include sector organisation representatives.
A committee report said the group would first consider the council's rural water quality implementation strategy and its principles.
Cr Shepherd said he was encouraged by the success of rural drop in sessions being held around Otago this month. The sessions gave rural people, including farmers, a chance to discuss with the council what the water plan would mean for them.
ORC chairman Stephen Woodhead said the significant changes made in the long term plan's initial proposals showed the council was listening to community concerns.
It was important some alternative options were offered to the community during consultations, he said.
During committee meetings this week, Cr Michael Deaker criticised a committee document which talked about achieving ''behavioural change''. The jargon suggested a potentially manipulative approach, he said.
All the council could do was put information in front of people, and clearly explain the water plan aims.
Cr Deaker was impressed by the work of long term plan hearing panel and staff contributions.
He praised the drop in clinics for explaining the plan.
The finance and corporate committee made several recommendations on the long term plan to the full council, which will consider them on June 24.
They include changes suggested by the hearing panel, to meet community concerns.
Among the changes is a 38% cut in required rural landholder funding of science and technology work, to $506,000.
