The contractor would be obliged to employ the 30 staff affected if the plan goes ahead.
Those employees and two managers have been asked to provide feedback on the council's proposal, which was today released to media by chief executive Paul Orders.
They have until June 4 to make submissions before the council's executive management team decides whether to implement the plan.
Mr Orders said the council faced an extra $30 million in maintenance and renewal costs for its ageing waste and water infrastructure over the next decade.
Contracting the servicing of that infrastructure was part of ensuring rate payers did not face rates increases of more than 3% each year, he said.