After months of living with what has been described as "brown, swamp-smelling water", hundreds of residents from a southern NSW town have called on their local council to rebate water usage and pay for damaged laundry.

Key points: A group of Yass residents has sent a petition to the local council, calling for compensation for damage caused by the town's water

A group of Yass residents has sent a petition to the local council, calling for compensation for damage caused by the town's water The council says brown water has been caused by higher levels of the chemical manganese, in part due to the drought

The council says brown water has been caused by higher levels of the chemical manganese, in part due to the drought Residents say despite promises to upgrade the water treatment plant, the process is taking too long

A petition by a group called Fix Yass Water, signed by more than 600 Yass residents, has asked for a reduction in water charges and partial refunds for the past six months.

It followed several months of complaints about discoloured water in parts of the town, which the council said had been caused by higher levels of the chemical manganese, in part due to the drought.

Prior to the state election, both sides of government said they would upgrade the Yass water treatment plant, with the Coalition pledging to cover the full cost of the project.

But residents said the solution was not coming quickly enough.

Resident Kay McLean said this doona is five weeks old and has been damaged by the water. ( Supplied: Kay McLean )

"The worsened water supply has led to damaged appliances, damaged clothing and fabric items and has forced residents to go to the added expense of purchasing water for cooking/drinking or filtration units for homes," the petition said.

"All of these outcomes, from poor water supply, have had significant financial impact on residents."

One of the requests from the group was rebates for repairs or replacements to appliances, water filters, damaged clothing and fabrics to be available to residents upon the presentation of receipts.

'Completely inconsistent'

Resident David Osbourne said the letter was designed to keep the matter front of mind.

"I've lived in Yass for about 10 years now and in that time I've never drunk the water, but in the past six months we've even had trouble even washing our clothes and other people are complaining about the same thing as well," Mr Osbourne said.

"Our clothes don't smell like they're washed when they come out of the machine."

Mr Osbourne described it as a swamp or creek-water smell.

"It's completely inconsistent across the town, some people have non-smelly but brown water, other people have both — smelly water and brown water."

The tap water is a rusty colour in some parts of Yass. ( Supplied: Amy Holt )

He said people had been advised to run their taps to clear the water, but that led to increased bills.

Some have said their water bills have tripled.

"We want to know what's available and what can be done, we want to know what we're legally entitled to," Mr Osbourne said.

Council consider request

Yass Valley mayor Rowena Abbey said the council would think about the group's requests.

"The petition was about trying to get some recompense for things that have got stained in washing or the fact that they've had to run their taps longer to try and clear the pipes, so that will be considered in a further report to council," she said.

The first report to the council on the request said rebates or refunds could not be paid unless the council increased the supply charge.

It was recommended the council reject that idea, because it would affect all users, not just those with discolouration issues.

Cr Abbey said the design and planning for the plant upgrade was "well underway".