Waterford Airport got almost €20m in funding from the State in the decade leading up to the suspension of commercial flights.
Taxpayers were routinely subsidising passengers' flights by upwards of €60 per journey before flights were grounded in 2016.
A year later, Transport Minister Shane Ross told the Dáil his department would not be in a position to even "consider further Exchequer support for Waterford until air services are resumed".
However, he has now signed off on a controversial €5m investment for a new runway at the facility.
As revealed in yesterday's Irish Independent, the move comes after lobbying from his Independent Alliance colleague John Halligan.
It goes against the advice of senior officials in a number of Government departments, including the Department of Public Expenditure and Reform.
Government experts believe they should focus on maintaining services in Kerry, Ireland West (Knock) and Donegal rather than investing in a fourth regional airport.
Those three airports received more than €8.8m in separate annual grant funding this week.
The €5m for Waterford Airport is to be used to extend its runway so that it would be able to accommodate commercial passenger aircraft such as Boeing 737s and Airbus 320s.
Another €2m of taxpayers' money will be handed over by Waterford, Kilkenny and Wexford county councils. The remaining €5m to fund the runway extension must come from private investors. At one stage the airport did boast flights to Spain, France and Britain - but business declined substantially from a peak of 144,000 passengers in 2008.
In 2012, this figure dropped to 77,000 and by the time flights were suspended in 2016 it had dropped to just 13,500.
Efforts to develop routes to Luton, Birmingham and Manchester in 2017 failed.
Mr Ross said yesterday that if he refused the cash injection now, it would "obviously be signing the death knell of Waterford Airport".
The Department of Public Expenditure told Mr Ross it would give "no new money", meaning he would have to find the funds from his existing budget.
Officials argued there was an "opportunity cost" associated with diverting €5m to an airport which caters only for a coastguard helicopter and private jets.
Taoiseach Leo Varadkar said last night: "I absolutely support the decision in Government to grant €5m to Waterford Airport. You have to bear in mind that Waterford Airport has to stay open, it's a coast guard base. A couple of years ago, we looked at moving it to Cork which wasn't viable.
"It hasn't been open to commercial flights for a couple of years, but this investment project has the potential to make this airport profitable and viable."
Mr Halligan told the Irish Independent the investment was justified on the grounds that local businesses were fully behind it. Among the companies understood to be involved in raising the additional €5m are Glanbia, Coolmore Stud and Dawn Meats.