Lobbying to move NSW Health to Orange was one of the issues discussed between mayor Reg Kidd, Orange City Council acting chief executive Ian Greenham and Labor's local government spokesman.

Greg Warren visited Orange as part of a region-wide tour, intending to find out more about councils' drought positions.

But discussions about the size of Orange's mining and health industries, as well as the amount of land already owned by the Crown at Bloomfield, led Mr Warren to pose a very different idea of decentralising the health department.

"I encourage every council across the state to see what opportunities exist," he said after the meeting.

"It's one of those issues where nothing ventured, nothing gained."

Mayor Reg Kidd said he intended to put forward a notice of motion to get the process started.

Mr Warren said he was encouraged by the Orange population's low water use and innovation.

"They have owned the issue and have been managing it as best they can," he said.

"It's a good indication, with the 140 litres [per person] per day when you look at some of them over 200, how they are collecting, preserving and distributing water."

He said implementing a NSW drought co-ordinator, who has been liaising with the state government on the crisis, was a positive step, but a roundtable discussion of mayors and general managers was needed.

"[Councils] really need better engagement - that means government ministers getting out of Macquarie Street," he said.

"For myself personally, I've found it very useful getting out in the regions, hearing firsthand the issues confronting communities."

With talks of several pipelines under way across the region, he agreed they were the answer.

"Dubbo has a really good initiative, a $200 million project to take water from the artesian basin and feed it back through the waterways, there's an ocean of water east of the great divide," he said.

"We need to have a serious conversation to see what measures can be put in place - if there's anything we've learned from this drought, is we need to do things differently."

He said future housing developments needed conditions of consent dictating how they would preserve water and while communities needed to be consulted, reusing treated effluent deserved further exploration.

Receive our free newsletters delivered to your inbox, as well as breaking news alerts. Sign up below ...