Uralla Shire Council's acting general manager David Aber said while there was a problem with arsenic in the towns water supply, the bigger problem was one of supply sustainability.
"Sustainability certainly depends on rain, but we also need to look at issues of climate variability" he said.
"We've been through one of the biggest droughts in 120 years, there's no doubt it's been in that order.
"We need to look at it in terms of the bigger picture. What are the weather systems going to be like in the future. People talk about climate change and all that sort of stuff; we need to be responsible enough to look at those issues."
He said the issue of higher rainfall variability needed to be addressed.
"There has not been a great increase in demand on Uralla's water supply. It's actually the yield that we've been getting has been lower in the last two years to what we normally get. Simple as that," Mr Aber said.
"What we need to do is look at ways we can improve storage, and the other thing we need to do, particularly as we approach day zero, is look at any alternate sources we can use.
"In the long-term we're putting forward to the region how we actually share water between the various councils and water suppliers. I think we need to think a bit more about this."
Mr Aber said council was now concerned it was delivering water outside its area, which had placed a higher demand on its water supply.
"When Armidale shut down water to Invergowrie, suddenly people in Invergowrie panicked and came into us, and actually put a huge draw on our water supply here to immediatly go back and fill their tanks," he said.
"Probably the better strategy would have been to fill them up with enough water to get them through, because last week they got 70mls of rain."
"It's just that what we do does effect our our neighbours."
He said consideration needed to be given to a regional water supply that helped everyone.
"This is thinking that is way beyond where the government is thinking at the moment," he said.
"We're running down this path because we need to, and it is something that needs a lot of research.
"It's not something that is going to happen overnight. Every drought we get some lessons and we need to learn those lessons now because once it rains, we'll forget them."
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