The Otematata Golf Club will get half-price water for a year.
Then the town's ratepayers will have to consider whether they want to continue subsidising it.
The club had a meter installed on its water supply to the club and irrigation on its nine-hole course, clocking up $22,500 a year in water charges.
But that was not sustainable and the Ahuriri Community Board recommended the Waitaki District Council give the club a 50% discount, while acknowledging that meant other ratepayers on the Otematata water supply would be subsidising it.
The council, at its meeting on Tuesday, approved that, but Ahuriri councillor Craig Dawson said it was only for a year.
The proposal the club continue to receive a 50% discount would go out as part of the council's annual plan (budget) for the 2013-14 financial year, which would be open for public submissions.
That would give Otematata people an opportunity to give their views on the discount, he said.
Cr Gus Young, who has a holiday home at Otematata, questioned the discount, when holiday-home owners turned their water off during winter.
Cr Dawson said the proposed discount was considered in public by the Ahuriri board and no-one commented to it.
He had also spoken to people who supported the discount.