More than 8000 new homes are set to be fast-tracked on the outskirts of Wellington, but the region's public transport plan is up in the air.
One regional councillor says the government is undermining its own housing policy by refusing to contribute to a programme of upgrades and maintenance.
It turned down a funding bid from Greater Wellington Regional Council earlier this year, asking the government to fund $134 million of a $270m plan over the next three years.
Regional councillor Thomas Nash said it would mean big cuts to planned improvements.
Warnings govt undermining two housing developments in Wellington
"That is significant in terms of what we can deliver," he said. "We're now having to go back and review everything, and it will involve some very difficult decisions."
KiwiRail funds the tracks and trains, and the regional council - through Metlink - funds the rest of the inftastructure, such as stations, real-time information systems and signalling equipment.
A lack of government funding means dreams of a shiny, upgraded network - a perk which also made living outside the city cheaper and more appealing - would have to be dampened down, or pushed out.
"The government has declined to fund any of our station improvements for Paraparaumu, Waterloo, Woburn, which are three stations where you could really improve housing through more intensive development, and it doesn't make sense," Nash said.
He said the Kāpiti line in particular was estimated to need $1 billion worth of upgrades in the coming years.
Property developer The Wellington Company has two subdivisions set to be fast-tracked up the coast - one in Paraparaumu and one in Ōtaki, totally 2300 homes all up - and both within walking distance of a train line.
Managing director Ian Cassels said public transport connections, which were often cheaper than owning and fueling a private vehicle, were vital to new developments.
"The main purpose here is to lower the cost of living so that people have disposable income, so society can function well, and at the same time, reduce carbon effects and improve the environment."
It was not about being anti-car, he said, but about giving people choice.
"I think it's vital that we conspire to lower the cost of living for people that have precious little disposable income," he said.
Without reliable and frequent public transport, people might opt to take the car over buses and trains, increasing emissions and congestion.
But the government has doubled down.
Transport minister Simeon Brown said in a statement it was time for councils to stop talking about wish lists and start acting on the funding already provided.
He said the latest funding boost, part of the National Land Transport Programme, gave Wellington a record $1.3 billion dollars for transport, and the council needed to focus on delivering better with what it had.
He said there were always more bids than money available.
"GWRC should explain to other councils and the rest of regional New Zealand why Wellington believes it deserves more funding, potentially at the expense of priority projects elsewhere in the country."
Waikato University professor of environmental planning Iain White agreed that it was vital to consider housing and transport together.
One of the issues with fast-track legislation, he said, was that it sat outside of other long term planning processes, which meant it would not necessarily move in-step with other urban planning goals.
"The key message from a planning perspective is that you should consider these things together. They're integrated, and that's what good planning is. It's not a series of isolated projects."
Housing minister Chris Bishop said in a statement that the government agreed the policies should be complementary.
But the aim of its housing policy was to let the economics of development guide where houses were built, rather than artificial planning rules, which he said were responsible for the housing crisis.
"We also believe in the principle that growth should pay for growth, so through our work on infrastructure funding and financing we are looking at giving local government stronger tools to fund and finance local infrastructure required to support housing growth," he said.
He said he would have more to say on this soon.
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