PORT Stephens Mayor Bruce MacKenzie ignored council staff and took sides with Newcastle Airport at Tuesday night's council meeting, but his push was unsuccessful.
The airport applied to have the council waive its $82,000 development contributions for the upcoming $8.2 million extension.
But the application was refused with council staff finding the proposed exemption to be unjustified.
"The airport has many social and economic benefits for the community and its expansion and ongoing use is supported and encouraged by council," council documents state.
"An exemption cannot be justified based on major infrastructure grounds . . . the airport is not considered to be major transport infrastructure in the same way as a NSW state public infrastructure provider," the report says.
Cr MacKenzie was frustrated with the decision believing it to be a reasonable request.
"We [the council] own half and Newcastle owns half," he said.
"It is like receiving money in one hand and pushing it out with the other.
The airport expansion will result in additional domestic flights, more retail space, a larger car park area and include infrastructure capable of handling international flights.
It is expected the full construction process will be completed by the end of 2015.