It also wants the whole amalgamation process to be paid for by central government.
Environment Southland chief executive Wilma Falconer has written to the Local Government Commission after the commission sought opinions from councils.
She released the letter on Thursday.
Earlier this year Environment Southland commissioned a report to assess ways to deliver better value for the Southland community.
This report, from TDB Advisory, evaluated options for integrating activities and services among the region’s councils.
Five options were considered against four criteria: effective services, financial efficiency, transition costs and enabling local democracy.
The report found a single unitary council would likely bring the biggest benefits, potentially saving money and working more efficiently.
In contrast, having two separate unitary councils for the region, as suggested by the Southland District Council, was considered the least helpful option.
It would be unlikely to save much money and would have considerably higher set-up costs.
Splitting the council’s functions in two would increase transition costs and catchment management complexity.
The report indicated there were likely to be efficiency gains from combining councils of up to about 50,000 to 100,000 people.
For capital and expertise-intensive network operations such as land transport and Three Waters (potable water, stormwater and wastewater), there were economies of scale that merit a region-wide perspective.
In regard to other, more labour-intensive activities, such as environmental protection, recreation and sport, noise and dog control, the case for amalgamation was weak.
It had been some time since the commission investigated potential reorganisation of local government, Mrs Falconer wrote.
At a minimum all councils in Southland would need to make staff available to the commission, meaning staff would have less time for their core roles.
The letter outlined the cost of other council mergers, and it was Environment Southland’s view this process, including the investigation and any reorganisation, needed to be funded by central Government.
"Ratepayers and councils are already under considerable financial pressure and significant expenditure on this process would be difficult to justify to ratepayers."
It was unclear how long it would take to achieve improvements through reorganisation, she wrote.
Any answer to this would depend on the type of reorganisation, if any, that was proposed.
"Major change typically takes longer than expected to deliver benefits, while costs are often higher."
All councils in Southland have extensive work programmes under way, and there were potentially further significant reforms being advanced by the New Zealand government.
It was likely there would be significant community opposition to any reorganisation that might result from an investigation.
"This is a critical question. It appears there is some support for reorganisation, including amalgamation, in the Southland community.
"These views, however, have tended to come from engaged citizens who take an active interest in council business."
To date there had not been any wider and comprehensive engagement and there were risks in assuming these views were indicative of the broader community position, Mrs Falconer wrote.
The Hawke’s Bay reorganisation proposal from 2013-15 demonstrated how essential public buy-in was for any amalgamation proposal to succeed.
"Despite belief there was sufficient community support to proceed with the investigation, in the end 66% were against the proposal."
The investigation might start positively around cost savings but then shift to concerns about political independence or be influenced by changes in central government policy.
"This highlights a critical concern: the risk of investing significant time and resources into an investigation that ultimately fails to gain public support."
