Tamworth is set to drop to Level 1 water restrictions next week after Chaffey Dam hit a crucial water level benchmark on Tuesday.
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Solid December rainfall has left the city's main dam 40.5 per cent full.
For the first time in years, the dam exceeded the trigger point on Tuesday morning, allowing a drop to just Level 1 water restrictions.
The city is currently subjected to Level 3 water restrictions.
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Tamworth Mayor Col Murray said Tamworth Regional Council staff had anticipated the level might be reached this week.
He defended the decision to jump straight to Level 1 and not wait for further water inflows before dropping water restrictions.
Cr Murray said Tamworth council had made a decision to simply follow their Drought Management Plan.
"We know there is a lot of concern or skepticism about what those [water] triggers might be but there's a lot of things to take into consideration as we understand the water availability from Chaffey Dam," he said.
"Once the irrigation community has access to the water, then irrespective of whether the townsfolk choose to conserve it or preserve it through restrictions the water will go down in Chaffey Dam. That's one of the considerations.
"La Nina, that's something that we need to consider."
The plan will be put to public consultation in 2021.
Cr Murray said the plan had served the community well during the "worst drought on record" and that he was reluctant to see too many changes to it.
Tamworth, Kootingal and Moonbi will all move to Level 1 water restrictions on Monday, January 4 next year. Manilla will also drop from Level 1 water restrictions to permanent water conservation measures the same day.
With the drop in restrictions, home gardeners will once again be entitled to use sprinklers, though only for two hours a day.
Hand-held hoses can be used for more than 15 minutes a day, though only between between 4pm to 9am.
Pools can be filled and topped up.