City Councilman Chip Henderson said city public works and the Hamilton County Water and Wastewater Treatment Authority (WWTA) are getting closer on the start of a consolidation cost/benefit analysis.
He said a resolution on a phase 1 study would be coming before the City Council in two weeks.
Councilman Henderson said he has long been interested in possible efficiencies and cost savings from such a merger. He said it would mean "both sides would be sitting on the same side of the table."
Justin Holland, city public works administrator, said the groups have been working with a consultant, who would carry out the initial study. It would take less than a year.
He said it would focus on the organizational structure of the two departments and how they might be integrated. He said the consultant would be examining "the challenges, the risks and the benefits."
A final report would be delivered to both bodies.
Mr. Holland said officials of the Tennessee Department of Environment and Conservation and the federal EPA would be consulted.
Councilman Russell Gilbert asked which agency would be in charge in a combined organization. Mr. Holland said that decision was "in another phase down the road."
The WWTA has been in the news with it planning a $45 million sewage treatment plant that was turned down by a majority of the County Commission after an outcry from neighbors.
The city operates the regional sewage treatment plant at Moccasin Bend.