The Riverina Eastern Regional Organisation of Councils will consider mergers with other groups after Wagga City and Snowy Valleys opted to leave the advocacy organisation after 24 years.
Wagga will shift its focus to the Canberra Region Joint Organisation, which has also Hilltops Council as a member.
From July, the REROC membership will then comprise of the Bland, Coolamon, Cootamundra-Gundagai, Greater Hume, Junee, Lockhart, Temora, and Goldenfields and Riverina Water County councils.
REROC Chair and Temora Mayor Rick Firman said the departures would have a financial impact on the group.
"The members such as Junee and Cootamundra-Gundagai are disappointed, we're disappointed in seeing original members departing but we can understand their positions," he said.
"Ultimately, they paid very large membership fees.
"We have the Riverina Joint Organisation and REROC boards running side-by-side and there is a review that will take place in 18 months that will determine whether we continue with both or merge into one."
Wagga council contributed almost $61,000 to REROC for the current financial year, with its councillors backing a motion to leave the group during Monday night's meeting.
Wagga council staff reported to councillors that there was "little, if any value" for the city in REROC's activities, except for the Southern Lights program for better street lighting.
Wagga deputy mayor Dallas Tout told the meeting it was sad to leave the group having been a member since its founding in 1994 but the city's needs had changed.
"I have seen REROC from the beginning...at the time there was a drastic need as resources sharing didn't exist and it fulfilled a lot of requirements but councils and technology has developed in the mean time," he said.
"Joint Organisations are the future and ROCs will be phased out."
Cr Firman said there were "certainly no hard feelings" over the departures.