The Minister of Local Government has advised the Tauranga City Council of her intention to appoint commissioners.
Tauranga City Council has 10 working days to respond to the Minister's letter of intention.
On 19 November Tauranga's mayor Tenby Powell terminated his tenure with immediate effect in a fiery speech to councillors and members of the public.
His resignation came after the council voted to bring in a Crown manager last month after an independent report found numerous governance issues.
Tauranga is facing a fiscal hole of $2 billion after a turbulent year marked by bitter infighting among councillors.
The city's leadership had been in the hands of the Minister for Local Government Nanaia Mahuta since Powell's resignation.
Mahuta said she had grown increasingly worried about the impact the council's problems were having on the city's ratepayers.
She said the council was given the opportunity to fix its problems, but had proved that more direct action was necessary.
Powell left behind a deeply divided city council who he accused in his resignation speech of being "small thinkers" with a "track record of hindering any progress" and "petty politicians" in "desperate need of progressive thinking".
He blasted councillors for blocking progress and said his experience had been soul-destroying.
Powell said he would also like the intervention to go further with commissioners appointed to replace the councillors.
He said that was necessary because the city had a "historical legacy of councils which are essentially old men's clubs".
Powell's resignation occurred one year after he was elected, and ahead of his treatment for prostate cancer. He said his resignation wasn't about his diagnosis - but rather the "desperate" need for new thinking, with the city's infrastructure in dire shape.
Local Government New Zealand backed the move to appoint commissioners, with president Stuart Crosby saying a commission would help get the city's governance back on track.
"The community always comes first on these issues so we're confident that an appropriately appointed commission will look after the interests of the community," he said.
"In the first instance, in terms of making sure that sufficient resources are put aside to run the city in a safe and effective and an efficient manner moving forward."