Council rejected the idea of recycling water due to its price tag - an estimated $71m and annual maintenance fees of up to $1.8m.

However, Western NSW Minister Adam Marshall said he would personally lobby the government to financially assist any councils that chose to investigate recycled water.

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"The state government has funding streams that support councils to upgrade their water treatment infrastructure," Mr Marshall said.

"Instead of replacing like for like, the state government would definitely support them if they wanted to upgrade to something more significant."

Tamworth councillor Mark Rodda said with the offer of funding on the table, recycling water "should most definitely be reassessed" by council.

"One of the issues we faced, was that we felt like we couldn't go it alone and we would ultimately need support from the state government," he said.

The issue has been considered taboo by some, however Cr Rodda said he'd noticed people becoming more open to the concept as water levels continue to drop.

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"Two things are certain - it's a reliable water source, and means we're not drawing as much from the catchment," he said.

"And it's more pure than what's coming out of the Calala treatment plant."

Council is still celebrating the recently announced $480m for a new Dungowan Dam, but Cr Rodda said that won't be enough to secure the region's water future.

"Dams are not the silver bullet for busting droughts," he said.

"I know in the future, communities will face increased water supply issues. Adopting alternative water security measures sooner rather than later makes sense."

The recycled water scheme would not have to be used all the time.

"It could be like Sydney's desalination plant, they don't switch it on until they need," Cr Rodda said.

Tenterfield and Armidale councils are investigating recycled water. Cr Rodda said TRC could work with the other councils to solve the common problems they would all face, such as compliance issues and what to do with the salt extracted in the purification process.