The advisory group's members would include former Auckland Waterfront Development Agency Ltd chairman Sir Bob Harvey, two members of the Gifted Reserves Protocol Committee, and two others.
An application for $400,000 to support feasibility, economic impact analysis and detailed design will be made to the Government's Provincial Growth Fund.
Although most members of the committee were in favour of the recommendation, member Bob Martin questioned why local people were "not given the opportunity" to be involved.
"Why do we have to go to Auckland? Why can't we have our own people?"
Council chief executive Geoff Williams said the challenges of the Lakefront development were not unlike those faced in the development of the Auckland waterfront.
He said Sir Bob had experience in bringing stakeholder groups together.
"All of that experience is sitting there."
Councillor Karen Hunt called the move a "wonderful step in the right direction".
The meeting became increasingly heated, with Martin saying he did not want to lose "Rotorua flavour" with the development, and he was concerned local people had not been consulted.
Councillor Merepeka Raukawa-Tait, who moved the recommendation, said parochialism had "hindered our progress in the past".
"Don't get your tits in a tangle, Mr Martin."
She apologised for the remark after being asked to withdraw it by committee chairman and councillor Charles Sturt.
The recommendation was passed, with Martin voting against it and committee member Potaua Biasiny-Tule abstaining.
Mayor Steve Chadwick and councillor Tania Tapsell were not present at the meeting, being away on council business.
Councillor Rob Kent and committee member Jim Stanton were also not present.
The full council will meet on March 29.
