Local Government New Zealand says the Government's foreshore and seabed proposals would trample on democracy.
In a submission to a review of the Foreshore and Seabed Act, the agency says iwi planning documents will create tensions for councils and communities.
Local Government New Zealand says it beggars belief that the Government is considering creating mechanisms which essentially walk over due process.
Spokesperson John Cronin says proposals for iwi planning documents, which would overide the Resource Management and Local Government Acts, would rub out community rights.
Mr Cronin says the planning documents would also result in extra costs to ratepayers.
But the Government has rejected Local Government New Zealand's criticism of the proposals.
The office of Attorney-General Chris Finlayson says iwi planning documents will not automatically be incorporated into council plans, although local government bodies will have to recognise them.
It says the documents will apply only to areas where customary title or interests are established.