After receiving a petition against the lease proposal signed by 15 business owners last week, however, councillors agreed to give staff two months to look at the carpark idea again.
The space is a council-owned berm behind 112 Newton St.
It is designated road reserve to protect the land from development in the likely event it will be needed for a new road.
The council previously leased it to HEB Structures for storage for $2200 a week, but the business moved on earlier this year, and people started parking there.
Michelle Peter of Industrial Sheetmetal said she was already leasing extra parks off-site and encouraging staff to use public transport but, like other nearby businesses, she was out of options.
She said businesses met with council staff in March and told them about the limited parking and the hazardous parking it led to.
They advocated for 'no parking' lines on a blind corner of Aerodrome Rd to stop dangerous parking and asked the council to build a public carpark, Peter said.
It was a surprise, she said, to see council staff instead pushing ahead with the lease agreement in a report that made no mention of the safety issues.
More shocking, however, was the estimate of $250,000 council staff gave for building a carpark.
Ken Andersen, who started the petition, said all they wanted was the site graded and metal chip laid, for which reputable companies had quoted $25,000 to $40,000.
He called the council's much higher estimate "scaremongering" and said a simple carpark would show support for small businesses and be easier to ditch when the space was needed for roading.
The council's transportation manager Martin Parkes said the estimate, while "on the high side" was for a proper sealed carpark, including improved access and stormwater management and a substantial risk reserve.
In his report, he said a carpark would be costly to build and maintain only to eventually be ripped up, and it was business owners' duty to provide staff parking.
A carpark would also encourage continued car use in one of Tauranga's most congested areas, he said.