Auckland Council has delayed discussions around finding the additional hundreds of millions of dollars needed to fund the City Rail Link "pending further consultation with government".
The project's request for additional funding was listed on today's governing body meeting agenda - but was later removed from the list of items.
A spokesperson for mayor Wayne Brown told 1News that discussions around the project's funding were delayed until council had completed further talks with central government.
Last week, City Rail Link Limited notified the project's key funders, central government and Auckland Council, that the estimated cost had risen to $5.5 billion — about $1.1 billion more than the last forecast in 2019.
The completion of construction was also delayed by a year to November 2025, with more time also needed for testing before passengers could travel through the tunnels.
Officials have attributed the additional costs and delayed completion time to Covid-19 lockdowns, staffing shortages and supply chain delays.
Following the release of the updated figures, Transport Minister Michael Wood made it clear that he believed the arrangement was for the costs to be shared equally.
"It's a 50-50 partnership between Auckland Council and the Crown," he said.
Wood added in a statement today: "Any additional funding requests from CRL or the council haven't been considered by Ministers yet and no decisions have been made. I won't pre-empt those discussions.
"What I'd note is that City Rail Link Limited has signalled the need for further funding for some time. While the precise amount has not been known to sponsors until recently, the Crown has been expecting a request and has planned for it."
Auckland Council has already been working overtime to make up what it says is a $295 million funding shortfall in its annual budget.
Its new annual budget — which remains open for consultation — proposes a wide-ranging set of cuts that could see parks, libraries, and recreational events lose out.
The council is also facing additional costs of around a billion dollars for its response to the devastating Anniversary Day floods and Cyclone Gabrielle last month.
It is reopening its emergency relief fund with a $1m top-up to provide rates relief to mostly red and yellow-stickered property owners.
Brown said the help would be for homes that can't be lived in and may include some properties with white stickers.