The German Harmonie Club cited dramatically increasing fees at Exhibition Park for the move, with the council keen to tap into the tourism benefit of the popular Bavarian festival.

At a council meeting in Bungendore on Wednesday, council administrator Tim Overall endorsed Queanbeyan Showgrounds as the host of Oktoberfest and agreed to a fixed term hire fee for the first five years.

The council also agreed to include $25,000 in the 2017/2018 budget to be spent on promoting the event and to focus on cashing in on the beer hall themed weekend.

Documents from the council meeting forecast significant potential for the city which "could become a flagship event".

"Economic returns to the wider community, from an expanded event, are well worth further investigation," the document read.

Modelling indicated the event could account for more than $600,000 in direct economic output for the city.

QPRC agreed to charge hire fees of $5319, plus a damages bond of $5500, for the three day event, nearly four times less than what was charged at the previous venue.

The German Harmonie Club forked out $19,800 to hire Exhibition Park in 2016, which increased from $6000 in 2011.

Club president Kevin Bramboeck said the rising fees put in place by the ACT government were "getting out of hand".

"What we were getting for our money we thought we could get a much better deal elsewhere, and [Queanbeyan-Palerang Regional Council] have been extremely generous and very helpful," he said.

With extra police being sent to the 2016 edition of Oktoberfest, police fees increased from $4000 in 2015 to $12,600.

The German Harmonie Club then had to get a separate liquor license costing $3500. Adding buses and other fees, the total reached $41,500.

The move over the border will also act as a fresh start for Oktoberfest, with declining numbers and an error-riddled event in 2016.

Last year organisers were forced to apologise for long lines and the closure of ticket sales on the Saturday.

But Mr Bramboeck said the club has focused on mending such issues, with a new payment system being considered.

"We know where the mistakes were, we know where the problems lie, and we've done a lot to rectify them," Mr Bramboeck said.

"We've always had a good proportion of our guests at Oktoberfest come from Queanbeyan and the city was very inviting."