Local Government New Zealand has told MPs a proposed new housing law has provisions that would be a direct attack on local authorities.
Parliament's social services committee has begun hearing submissions on the Housing Accords and Special Housing Areas Bill.
The legislation enables housing accords, such as one tentatively reached with the Auckland Council, and allows the Government to make unilateral planning decisions if agreement can't be reached with councils.
Local Government New Zealand president Lawrence Yule told the committee it won't accept the Government overriding council powers to zone land and issue consents for new homes.
He said the Government would be entering into dangerous territory if it sought to override community-developed plans and compromise existing existing decisions on infrastructure.
Housing Minister Nick Smith told Radio New Zealand's Nine to Noon programme he understands the local body perspective, but the Government has a different view.
Dr Smith says he has made it clear in discussions with the Auckland mayor that the Government's strong preference is the accord mechanisms, but if they do not work, regulatory powers proposed in the bill will need to be used to free up land supply and get the housing supply increased.