The Government is unlikely to fund Team New Zealand if Auckland loses hosting rights for an America's Cup qualifying regatta, the Prime Minister says.
Team New Zealand says it has been told the organisers of the yacht race have bypassed a conditional agreement to pull the challenger series from Auckland.
The move comes amid a dispute over cup bosses wanting to change the size of the boats for the 2017 America's Cup.
The teams in the competition will vote mid-week on the proposal.
John Key said a decision on funding would not be made until the matter was cleared up.
"We'll have to wait and see how it goes but it becomes difficult to justify putting in money if it's only raced in Bermuda," he said.
"There's not a lot in it for us in Bermuda. We really need something in New Zealand - it was easier when it was, obviously, in San Francisco - so I'm not convinced it'll be gone from Auckland yet."