The idea was floated by council business development team leader Greg Sligo in twin reports discussing Dunedin's community sporting facilities, to be considered when the council's 2011-12 pre-draft annual plan hearing resumes today.
Mr Sligo said it was "becoming evident" Dunedin had too many individual clubs occupying single buildings or facilities.
An earlier investigation, in 1996, had found 253 non-council sport and recreation facilities scattered across the city, and it was believed that number was largely unchanged, he said.
Anecdotal evidence suggested many of the facilities were approaching, or had already reached, an age at which major work would be required "to ensure their continued existence", he believed.
The list included 49 schools providing facilities, which were unlikely to require council assistance.
However, the deteriorating condition of other facilities could have financial implications for the council, despite being outside council ownership, he warned.
Groups running the facilities could approach the council for assistance, or the council could face requests for new facilities if venues deteriorated to the point they were no longer usable.
The council regularly assisted community groups, but did not budget for large-scale maintenance and upgrade work for non-council facilities across the city.
Tighter economic conditions also meant less money was available from community trusts, which would "almost certainly" lead to more requests for council help, he warned.
The council had already received one request for $200,000 towards the $765,000 cost of redeveloping the Sunnyvale sports complex, which was built on council reserve land but owned and managed by the Green Island Combined Sports Bodies (GICSB) group.
That request was first received in 2008 but a decision was delayed while the council and Sport Otago investigated how many other community facilities might need help.
One of Mr Sligo's reports said Dunedin's clubs might be spreading themselves too thinly.
"It is becoming evident that, in general, Dunedin has too many single clubs occupying single buildings [or] facilities. Some of these clubs are struggling to function financially and are facing the challenge of attracting new members.
"Sports clubs in Dunedin, where appropriate and possible, should be encouraged to amalgamate to utilise single facilities."
It was a model already being pursued by the GICSB at Sunnyvale, which represented cricket, football, badminton and squash, and one that had financial benefits for the clubs and the council.
One way of encouraging amalgamation was through service level agreements (SLAs), providing funding in return for agreed objectives being met, he said.
Agreements were already in place for the Dunedin Ice Stadium and Edgar Sports Centre, and Mr Sligo's report recommended another be investigated as part of any development at Sunnyvale.
The suggestion comes after the council moved in 2008 to reduce the number of bowls clubs using council reserve land.
In his second report, Mr Sligo suggested the council consider establishing a contestable fund to assist groups with maintenance and upgrades.
The money could be tied to conditions ensuring better public access to the facilities, some of which had previously received council support without any guarantee of wider public use, he said.
Priority could be given to supporting facilities for which there was a shortfall in Dunedin, he suggested.
Councillors at today's hearing would be asked to approve further investigation of the options for a SLA with the Sunnyvale group, with a follow-up report to be presented to councillors.
A further report on a new contestable fund would be prepared with Sport Otago and presented at a later date.
