"Obviously, yes," said Darren Flynn of the Community and Government Services Department. "The city has taken the approach that they want somebody else to pay for it and I think they were waiting to see if somebody else would pay for it.
"For me to say it hasn't delayed it, that wouldn't be accurate at all."
The fire, dubbed the "dumpcano," has been fouling air with chemicals that include known toxins since May 20.
City and territorial officials are considering a $2.4-million plan to finally extinguish the blaze. The city has asked for financial aid.
A meeting that was to be held between city, territorial and federal officials on Friday to discuss the plan was cancelled.
The territory then hand-delivered a letter to city officials that pointed out the various options Iqaluit has for financing the fire fight with its own funds.
The city has $7.5 million in unrestricted reserves it could use, the letter says.
"Maybe they've identified other purposes (for that money)," said Flynn. "But if you were saving for a car and along the way the furnace goes in your house, you're obviously going to change your budget.
"All we're saying to the city is that you may need to adjust some of your priorities."
Iqaluit officials did not return requests for comment.
Flynn said the territory has already provided support in terms of equipment. It's also offered to front the city cash to pay for the effort.
The job is expensive because the combustion is smouldering deep within a massive pile of trash about the size of a football field and as much as four storeys deep.
A consultant has proposed building a large pond walled by dirt and garbage and filled with seawater. High-extension excavators would take load after load of burning waste and dunk it in the pool. The waste would then be drained, flattened and stored in a new area.
Water from the quenching pond would be pumped onto the burning section of the dump to quell the flames expected to leap up as shovels bit in.
Until something is done, the fire will continue pumping smoke from untold thousands of household garbage bags as well as from all the other unsorted waste in the dump.
Last Thursday, Nunavut's Health Department released air-monitoring figures that suggested levels of most contaminants emitted by the fire remain low.
But levels of dioxins and furans — both known carcinogens — remain above standards set by Ontario. Children, pregnant women, seniors and those with lung problems were advised to avoid exposure to the fire's smoke.
— By Bob Weber in Edmonton