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The council yesterday discussed Queenstown Airport Corporation concerns about upgrading costs to cater for the trans-Tasman flights to the airport and the anticipated short-term financial losses.

A new 2.5m-high security fence required around international airport boundaries could cost $500,000, in addition to terminal renovations, Mayor Warren Cooper said.

He has written to Customs Department officials suggesting they contract out Queenstown border services, training local people to do the work.

"It's a big burden bringing staff in from Invercargill or Dunedin -- it's all a charge on the Queenstown Airport Corporation," he said.

However, Cr Simon Hayes said the council should put pressure on Tourism Minister Murray McCully to alter existing aviation policy and do away with immigration and customs requirements between Australia and New Zealand.

The corporation's efforts to get Queenstown's big tourism players to contribute $50,000 each into "the begging bowl" to help refurbish the airport were unprofessional, Cr Hayes said.

Departure taxes and levies were accepted worldwide by airport users and should be investigated, he said.

Other councillors supported the idea, but Mr Cooper warned Cr Hayes against "sabotaging" efforts to get local businesses to contribute on a short-term loan basis secured against the airport.

"We are not going to be the biggest trend-setter in New Zealand to attack tourists with large fees, most of which goes to the collection of them," he said.

Mr Cooper believed a future council should consider selling the airport.

The council, as sole shareholder, had never taken a dividend from its airport investment, instead channelling all profits into improving airport facilities, corporation chairman Philip Phillips said.

His quarterly report said the corporation had achieved a net after-tax profit exceeding $2.5 million since 1990.

About $3.4 million had been spent on capital projects with no additional share equity issue and shareholder's funds had increased from $3.25 million to more than $5.8 million, he said.

Meanwhile, the corporation will appeal an Environment Court decision requiring it to buy out two McBride Street properties at the west end of the runway.

Two further buy-out applications relating to the same area had been made recently.

However, a redesignation of the noise contour in the new district plan meant it would no longer be over these properties, Mr Phillips said.