"We strongly believe this approach will receive wider support during implementation.
"It provides for a level of business security which will support investment in farms to reduce nitrogen losses and is likely to attract significant industry investment in the development of farm nutrient plans."
The advisory group, formed in 2012, represented pastoral, water quality and forestry sectors, and iwi to advise and recommend on the development of the catchment.
Council natural resource operations general manager Warwick Murray said rules for nitrogen limits had an economic impact on rural landowners.
The council would continue working with landowners to ensure the best possible outcome for Lake Rotorua and the local rural economy, he said.
"The stakeholder advisory group has provided critical input into how we approach the rules and incentives development for the Lake Rotorua catchment.
"We are now all in agreement on a way forward - this is a significant achievement for rural landowners, the council and the community."
Iwi, farmers and forestry owners have met monthly since November with both local and regional councils to find a way forward that provides both the economic viability for rural landowners and the necessary nitrogen reductions.
The regional council has proposed a nitrogen limit of 435 tonnes per year for Lake Rotorua - a 270-tonne reduction from current farming activities - as part of the council's Ten Year Plan.
Rules and incentives would determine the best way of allocating the sustainable limit to pastoral land use activities in the catchment - setting out who can discharge what, and how much, in the catchment.
The agreement between stakeholders and the council will deliver 140 tonnes' nitrogen reduction through landowners' action, while incentives will deliver 100 tonnes and 30 tonnes reduction through a gorse project.
The regional council has set aside $45.5 million for the incentive fund, depending on Government funding.
The rules would go out to wider community consultation in June next year.
Rural landowners will need to have approved farm nutrient plans and apply for resource consents by December 2017.