KIAMA Mayor Brian Petschler has echoed residents' opposition to merging with other councils, and said Kiama has been proactive in collaborating with its neighbours.
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The state government will offer councils financial incentives to merge.
Last Wednesday the government announced Fit For the Future, a $1 billion package aimed at the state's local councils.
The package features a pool of $258 million to assist councils that decide to merge, including $153 million for Sydney councils and $105 million for regional councils.
The government said amalgamation would make NSW's 152 councils more efficient.
"These councils are losing $1 million a day," Premier Mike Baird told Fairfax Media.
"That's unacceptable, it can't go on."
In 2012 the Minister for Local Government announced the establishment of the Independent Local Government Review Panel, which investigated options for governance models, structural arrangements and boundary changes for NSW local government.
In its final report to the state government, the panel maintained its stance from its Future Directions paper, saying Kiama Council could stand alone.
The panel recommended sharing resources between Wollongong, Kiama and Shellharbour councils.
The government's proposal for "joint organisations", announced in Fit for the Future, includes 15 proposed for regional NSW, such as one for the Illawarra which will represent Wollongong, Shellharbour, Kiama and Shoalhaven councils.
Joint organisations would undertake a range of "high-level functions" on behalf of member councils.
The Illawarra joint organisation will eventually replace the Southern Councils Group.
Cr Petschler said the respective mayors of Kiama, Shellharbour, Wollongong and Shoalhaven City councils had already taken the initiative in meeting with Minister for the Illawarra John Ajaka and NSW Minister for Local Government Paul Toole.
"We indicated we were ready to work as a regional organisation, as proposed in the review," he said. "We have been proactive on that basis, looking at ways to work together to be more productive on a regional basis.
"'We feel we can move forward quickly on the regional aspect.
"We think we can further develop those mechanisms to make ourselves more efficient in the future.
"I think all four communities don't want the amalgamation."
Local Government NSW president Cr Keith Rhoades said the organisation was pleased the government listened to their calls for greater incentives to help councils navigate the reform process.
"A key feature of the reform package is that there will be no forced amalgamations.
"There is, however, funding set aside for the immediate future to fund expert assistance and technical support for councils, who have been asked to prepare and submit proposals for change to the government by June 2015.
"From 2015-16, the government will make available about $300 million to help councils action their approved Fit For The Future merger proposals, to establish joint organisations in non-metropolitan areas and for rural council innovation.
"While rate pegging won't be abolished, the government has agreed to review the rating system and provide rating flexibility to those councils."
