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The policy, which is being reviewed by the council, prevents any new gaming machine venues being established.
In a statement from the association, its independent chairman, Bruce Robertson, said he asked that a balanced, evidence-based decision be made.
It claimed, from the most recent data available from the Ministry of Health's records, only one new person from the Southland district sought help for problem gambling between July 2017 and June 2018.
"There is no direct correlation between gaming machine numbers and problem gambling rates. Over the last 10 years, the problem gambling rate has remained the same, despite gaming machine numbers declining rapidly."
The machines generate over $1 million annually in community funding, which is used to support sports clubs such as Cycling Southland, community organisations such as the A&P Association and Parent to Parent, local schools and the Winton Volunteer Fire Brigade.
Mr Robertson said more and more grant applications were being declined due to a lack of available funds for distribution.