Arun, Chichester and Horsham District Councils are exploring plans to share services in a bid to save £2 million a year and improve services.
The councils are believed to be considering sharing human resources, legal, and internal auditing services, with Chichester and Arun District Councils also looking into the possibility of sharing revenues and benefits, customer services, and information and communication technology.
The cabinets of all three councils have been working together since March and are set to further consider the findings this month.