The council voted 10-4 against giving the ecosanctuary $70,000 at the 2023-24 annual plan deliberations earlier this week.
The money would have been used to fund its new education programme the Ministry of Education abandoned.
Members of the council voted against the proposal over concerns they were becoming the "surrogate replacement for the Ministry of Education".
Deputy mayor Sophie Barker, in opposition, said it was not the council’s responsibility to pick up the Government’s slack.
"I feel like we’re being asked to fill in a gap that the Government have pulled out of," she said.
"We can’t just keep plugging these gaps."
She said the council did not have enough information and did not want to jeopardise a potential saving that would ease the rates rise.
Cr Jim O’Malley, in opposition, said the Government’s funding withdrawal had come with little warning and the funding would stretch the council too thin.
"If we step up and become the surrogate replacement of the Ministry of Education withdrawals from the city, we are going to end up being hit with an enormous burden," he said.
Cr Mandy Mayhem, in support, said the ecosanctuary was valuable because of the taonga species that called it home.
It gave school children authentic opportunities to learn in a real-life context, and was an important resource for lower-decile schools.
It offered free entry to school children during the holiday breaks.
She said 8000 pupils would be the wider recipients of the funding.
"What we have created is something that will outlive all of us."
Cr Carmen Houlahan, in support, said the $70,000 price tag would not make a huge dent in the rates.
"A lot of us forget that this is an internationally recognised space that is really doing quite amazing things in our own backyard."
Mayor Jules Radich, in support, said the proposal was "quite a dilemma".
The ecosanctuary attracted hundreds of school children and a lack of funding would be a great loss, he said.
