ARMIDALE Regional Council has been slapped with a suspension warning notice from the Minister for Local Government.
The mayor Simon Murray and councillors have been notified of an intention to suspend them for three months and appoint an interim-administrator.
The show cause notice was issued on Tuesday afternoon by minister Shelley Hancock.
The suspension is the result of serious concerns about the ability of the council to function properly following a legal spat between Armidale Regional Council, the chief executive Susan Law and a group of five councillors that have twice tried to have Ms Law removed from office.
The matter remains before the NSW Environment Court, and no findings have yet been made.
The breakdown of relationships between councillors and key staff poses significant reputation, legal and work, health and safety risks, Ms Hancock said.
"Under the Local Government Act, the minister is required to provide the council with the opportunity to make any submission before making a final determination on suspension," she said.
"The council now has 14 days to make a submission as to why it should not be suspended and an independent administrator appointed for three months.
"By law the minister must consider any submission before making a final decision.
"The NSW government is committed to ensuring the Armidale community has a council that is serving its best interests."
The suspension would apply to the mayor and councillors, it would not affect council staff and daily operations.
The interim-administrator would perform the role of the mayor and councillors for the length of the three-month suspension, if it is approved.
Northern Tablelands MP Adam Marshall welcomed the urgent intervention to resolve what he called "significant issues of dysfunction" within the leadership team.
"Last week, I asked the minister to ensure any action she took was expedited to ensure this untenable situation was not allowed to continue and become 'business as usual'," he said.
"Today's notice of intention is hopefully the first step toward sorting out the issues plaguing Armidale Regional Council and putting its focus back where it should be - providing effective and united leadership for the region and delivering for the local community.
"Our region and our communities expect and deserve much better than they've been getting of late from council.
"With the minister's timely action, the ball is now firmly in council's court to step up to the mark or be moved out of the way."
On Tuesday, ARC confirmed in a short statement it had received an official letter from the Office of Local Government.