This comes on top of the mass resignations of five members of the Blue Haven Advisory Board over the last month - just over six months after they were appointed.

On June 9 board members Joanne Sabena, John Cleary, Richard Bailkowski and Pearl Forrester all resigned.

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Another board member Michael Forsyth quit on May 11 - just two days before council announced the decision to sell off the facility.

Mr Forsyth said he had no knowledge of the pending sale; he had resigned for "family reasons".

A council spokesperson said the timing of the mass resignation of the board members "makes sense".

"We formed the Blue Haven Advisory Board under the Local Government Act section 355, where councils are able to delegate aspects of their management functions to a committee," the spokesperson said.

"As we have moved forward, it has become less appropriate for the Blue Haven Advisory Board to operate as a Section 355 committee, hence we will be remodelling."

Councillors will soon receive a discussion paper with options for how best to remodel the Blue Haven board.

One option already off the table is giving the council's Audit Risk and Improvement Committee (ARIC) oversight of the facility.

"As council is the approved provider of Blue Haven's services, it makes sense to use our preeminent committee, ARIC, to oversee Blue Haven," Kiama Council and Blue Haven CEO Jane Stroud said last week.

However, at an ARIC meeting this week, the group - which includes Mayor Neil Reilly, councillors Jodi Keats and Karen Renkema-Lang with three external members - refused to take charge of Blue Haven.

"ARIC has a clear set of regulations that prevented them from undertaking the Blue Haven Advisory Board role," the spokeswoman said.

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"As an advisory board to council there were concerns regarding responsibility for governance strategy and risk."

Being concerned about risk is an odd reason given the word features in the committee's name.

After passing a motion to sell off Blue Haven, councillors later rescinded it and replaced it with a motion calling for council to explore all options - but critics have noted that sale is still one of those options.

To voice their opposition to any sale around 100 people turned up at a public meeting on Thursday night.

Among the speakers were John Ashworth, chair of the Blue Haven Residents Committee, Gilmore MP Fiona Phillips, Shellharbour MP Anna Watson, former Kiama mayor and general manager Brian Petschler and South Coast Labour Council Secretary Arthur Rorris.

Ms Stroud was invited to attend but declined.

Mr Ashworth referred to the initial motion to sell as "the most despicable, heartless and cruel" ever passed by Kiama council.

"The motion's been amended but the underlying threat to sell Blue Haven is really there, subject to a few reservations and conditions," Mr Ashworth said.

He said residents were "living on the edge", unsure of what may lie in the future.

"This isn't just Blue Haven, just some bricks and mortar - it's our home," he said.

"It's where we live. It's where we want to live for the remaining years of our life and we want to live in peace and security.

"That peace and security has been shattered by this council."

He wanted council to scrap plans to sell Blue Haven.

"Take it completely off the agenda without any reservations or conditions," he said.

"Just take it off the agenda and then we can get on with our business and the council can get on with their business."

Mr Rorris said he had never seen a situation where a government made a decision that would affect half its workforce behind closed doors and without any advance consultation.

He told the meeting the South Coast Labour Council unions would "back you in all the way".

Mr Petschler was one of three former mayors who wrote a joint letter over the sale - which they felt didn't need to happen.

"We made it clear that both the aged care facility and the retirement village can be saved - council does not need to sell either," he said.

"We think there are some economies that could be achieved and we think they could trade out of the deficit in a relatively short time."

At the meeting a petition to NSW Local Government Minister Wendy Tuckerman and federal Aged Care Minister Ron Colbeck called on them to intervene to keep Blue Haven in public hands.

After deciding to sell the facility in a confidential session, council is now engaging in community consultations over Blue Haven's future.

"It's been invaluable spending time explaining council's resolution, answering questions and clearing up misinformation," Cr Reilly said.

"Hearing directly from those most affected, our residents and others in our care, was a strong start to our consultations.

"There were lots of different views and ideas, plenty of questions and a good deal of anger about Blue Haven's past expenditures, and demands for clarity in future."

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