Bay of Plenty Regional Council extending its deadline for nitrogen levels on farms around Lake Rotorua to be reduced.
Federated Farmers and the council on Monday signed a memorandum of understanding to reduce nitrate levels over the next 20 years.
The agreement was brokered by Todd McClay MP. It ends a long running dispute between the council and landowners over pollution of the lake from farming and other sources.
Federated Farmers previously lodged an appeal with the Environment Court against the original timeframe.
Radio New Zealand understands the document will aim to reduce nitrogen levels by 70% within 10 years and almost 100% by 2032.
The council will play a bigger role in helping farmers with planting and fencing around the lake, as well as developing individual irrigation and fertiliser plans.
Rotorua Taupo federation president Neil Heather said the agreement will allow farmers to meet the target without going bust.
He said an important part of the agreement is the council's recognition of the importance of farming to the local economy.
But the agreement does not impress the Green Party, which says 20 years is too long to wait.