Queenstown mayor Jim Boult says he's in discussion with government departments about how the tourism-reliant region can be helped.
Boult told Checkpoint the latest shift in alert levels brought another round of difficulties for the region, which was already suffering with closed borders.
He describes the cancellation of the annual Motatapu running and cycling event as a "major disaster". He said for the region to be in alert level 2 because of cases in Auckland was a bit of an "overkill".
"We have to have our economy carry on and we can't at the present time.
"I had a discussion the other day with the prime minister who suggested businesses in our region need to pivot. 'If you don't have any customers', I said to her, 'I don't know how you pivot'."
He said he was getting daily calls and emails from businesses who were "just desperate".
"I've got businesses telling me their turnover for February was in excess of 90 percent down on February last year. People say to me, 'oh, businesses should've kept some reserves for when things get tough'. We've been like this for a year, maybe going to face another year [like this], I don't care how much money you have to start, you're going to run out."
He said he could not put a price on how much this latest alert level shift would cost the region, but it was "a hell of a lot".
"I know some [businesses] are teetering and I'm picking that this [alert level change] will be the end for some."
The government was listening to what the region had to say, Boult said, with a raft of suggestions being put forward on how the region could be helped.
"What I'm worried about is that when tourism does come back it'll be a bunch of empty shops and closed restaurants and that would be a disaster. We have to keep a core business going and I just can't see that happening at the present time."
Locals going elsewhere in the country to get jobs would "rip the guts out of our communities", he said.
He said he had recommended a travel incentive similar to what Australia had done, with a credit system to encourage people to roam around, and small business loans to help those in the area survive post-Covid.
"I'm carrying on discussions with government departments .. we are determined to carry on and support our local communities."
He said the last conversation he had with the tourism minister was two weeks ago, and he had been very proactive and expected to see him in region this month for further conversations.