The third reading of the Waitaki District Council Reserves and Empowering Bill was heard in Parliament on Wednesday evening.
The sponsor of the bill, Waitaki MP Jacqui Dean, was unable to be present at Parliament, but the debate was led by Nicky Wagner (National, Christchurch Central), who chaired the select committee.
Of the Members of Parliament present in the House, 98 voted for and 22 against.
Waitaki Mayor Alex Familton said it was good to see a resolution.
"This will provide a clean slate from which to start the processes," he said.
Mr Familton has previously undertaken that the council will consult the community before any plans for Forrester Heights are decided.
Waitaki Ratepayers and Concerned Citizens Association chairman Warren Crawford said he was disappointed with the decision.
"Council would be foolish to spend any money at this time of recession," he said.
"They have better projects, such as Hospital Hill, to focus on."
Twenty-one submissions for the bill were received by the committee, including one from the Waitaki District Council.
For Forrester Heights, also known as Lookout Point, the bill will correct an historical error in relation to the word "reserve".
The land was bought by the Government from Ngai Tahu in 1848 as part of a Kemp purchase and was included in the original subdivision of the town of Oamaru.
This will provide a clean slate from which to start the processes.Alex Familton, mayorIn 1885 the land was "reserved" as an endowment in aid of funds for the benefit of the (then) Oamaru Borough Council in accordance with Section 38 of the Land Act 1877 Amendment Act 1884.
An administrative oversight in 1937 mistakenly vested the land as a reserve.
Reserve status and endowment status are separate concepts and that may not have been fully appreciated in 1937.
The confusion arose as a result of semantics. While the land had been "reserved" as an endowment in 1885, it had not been intended that it should be classified as a "reserve".
Forrester Heights has been steeped in controversy since it was first proposed in 2006.
The 5.842-hectare block has been designated 29 sections, with prices from about $300,000.
However, further marketing and development was halted in 2007 when the council discovered the anomaly regarding the titles to the land and moved to correct their status.