Two councils could set up a link which would see them sharing services, in a move believed to be a UK first.
Charnwood in Leicestershire and Rushcliffe in Nottinghamshire could share finance, human resources, IT, benefits and revenue services.
The move would have to be approved by councillors and would come through a partnership with a private company.
Charnwood Borough Council said the changes would help to improve services and save money.
Rushcliffe Borough Council said a report on the scheme will be put before the cabinet on 9 September after which a final decision will be taken.
Staff changes
The councils have teamed up with Liberata, a private company, to implement the proposed scheme.
Leader of Charnwood Borough Council, Richard Shepherd, said: "Sharing expertise, sharing skills, working with others, it makes so much sense really."
The arrangements were still in the process of being worked out and "nothing is quite yet finally arranged", he added.
He said the councillors would still be accountable for the services, but Liberata would employ the staff concerned.
The company plans to build a new centre somewhere between the two council areas.
Some staff would continue working in the local council offices, while others would transfer to the new location with their jobs.
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