Local Government New Zealand says flat funding for roads is the single biggest issue facing councils.
The Transport Agency has made $1.28 billion available in the next three years for local road maintenance and renewal, an increase of 2%.
The Government has signalled such funding is likely to increase very little in the next decade.
Councils are currently finalising their long-term plans.
Local Government New Zealand president Lawrence Yule says councils are responsible for maintaining 88% of all roads and funding can't be held for long.
The New Zealand Transport Authority says critical roads will continue to be maintained to a good standard.
However, it says the level of maintenance and renewal on some roads, such as those which carry low volumes of traffic, could fall.