Changes proposed for the Local Government NSW annual conference would force councils to charge mining companies rates similar rates to that of other businesses in the Shire.

The recommendation, known as Recommendation 34, reads "any difference in the rate charged by a council to a mining company compared to its average business rate should primarily reflect differences in the council's cost of providing services to the mining properties".

A report prepared before Blayney Shore Council's meeting last Monday night said council's current mining rate was 6.8 times its business rate, and bringing it in line with Recommendation 34's limit of four times the business rate would cut council's income by over $1.8 million a year.

Council currently has a mining special rate variation which is allocated to additional costs incurred by council providing services impacted by mining activities.

"Unless council could demonstrate that our additional costs are in fact greater than that covered by the Mining SRV, the reduction in income would be $2,848,940," the report said.

Cabonne Council discussed the issue at its September meeting, and determined it could be up to $1.6 million out of pocket should the recommendation be approved.

Bland Shire Council, which is based in West Wyalong, will put forward a motion at the LGNSW conference opposing turning Recommendation 34 into legislation "in the strongest possible terms ... because of the severe and adverse financial impact this will have on all mining affected communities".

A report prepared for Cabonne Council said the potential loss in revenue would "see approximately $1.6 million in income currently sourced from mining being instead distributed across other rating categories, in effect raising the rates obtained from these categories".