Canterbury regional council says it could cost up to $1 million to clear a huge pile of tyres in Amberley.
The blaze in the pile of tyres started on Friday afternoon, sending clouds of toxic black smoke billowing into the air.
A 63-year-old man has been charged with arson.
"The bulk of the contamination that's there now is just mangled steel with spots of tyres in it." - Andrew Arps
Environment Canterbury spokesperson Andrew Arps told Morning Report fire crews were not tackling the blaze using water, in order to avoid contaminating the local water table.
"The water table is about five metres down, so we didn't want to have any water being put on and actually contaminate the water table, that's why it's being allowed to burn out."
Critics say the mountain of about 150,000 tyres should have been dealt with years ago.
Arps said the council had been working through plans for getting rid of the tyres but it had been a complex exercise.
"The reality is that it all takes time because there's a number of components to bring that in together - everything from obviously working with the landowner, legal aspects around ownership, proven logistics to actually take the whole thing through an environmentally-friendly, appropriate manner and of course funding."
He said it could cost up to $1 million to resolve the problem.
Call for emergency funds
An Amberley community group said the Canterbury Regional Council or the government needed to fund the clean-up.
The pile is still burning after being set alight on Friday afternoon.
The land owner was prosecuted over a fire in the same pile in 2018 and Accountability Action had been fighting to get it removed since 2019.
Spokesperson Julia McLean said the tyres could still contaminate the town's water supply.
"We're calling on emergency funds to be released by Environment Canterbury or the Crown in order to alleviate contamination risk to the town's water supply and to stop holding the town to ransom on this issue that's been going on for four years."