A Bay of Plenty leader says the Government's Three Waters proposal has "fundamental issues" and is disappointing.
But, others say there is "misinformation" circulating about what the reforms really achieve and New Zealand can't afford to not go ahead with them.
The Government announced on Friday it would move forward with the Three Waters proposal to give control of New Zealand's water services to four newly-created entities, instead of local councils.
The entities would be run by boards that are appointed by a panel, which is appointed equally by councils and mana whenua.
One change to the initial proposal was local councils would now have a shareholder's stake in the created entities, potentially allowing for more influence over their operations.
Councils would have "shares" in the new water entities with each council getting one share per 50,000 people in its district. Each council will have at least one share.
Bay of Plenty MP Todd Muller said he was "extremely disappointed" the Government was moving forward with Three Waters.
He said some councils had failed to manage their wastewater, but "their failings shouldn't see us lose our ability to control our own assets."
He said Tauranga had "world-class" water systems.
"The idea that councils which have been successful in managing wastewater ... have to get enveloped into these large organisations ... I think is wrong."
He said people in the Bay were at risk of losing their "direct line" to those managing their water, and their ability to vote them out.
"I think there are fundamental issues around control and loss of assets and loss of local voice and influence."
He thought the addition of a shareholder stake for councils was not a meaningful change and local voices would end up "dominated by the Wellington bureaucracy".
Tauranga-based Labour list MP Jan Tinetti said she was "really happy with the improvements" the Government announced.
"For far too long, councils have had to offset difficult decisions about funding water infrastructure and services against other important initiatives locally, and often, water infrastructure comes out second best."
She said projected population increases, housing pressures and climate change were putting pressure on water infrastructure.
"[Three Waters] is a way of supporting [councils] for the future ... it enables councils to focus on those things that they are facing significant challenges over, but they're still going to have a say in the water area as well."
She said some people were worried Three Waters would end up privatising the water supply, but the council's shareholder stake meant that was "completely taken off the table".
She said the Government's job going forward was to help the public better understand the proposal as some concern about Three Waters was due to "a lack of understanding".
"There's a big place for education going forward ... to help people understand how amazing this could be for our country."
She said there was "misinformation that has been put out there, particularly in the areas of the likes of co-governance - people have been wrongly led to believe that this is an asset grab on behalf of iwi Maori, and that's not the case at all."
Bay of Plenty-based Labour list MP Angie Warren-Clark said New Zealand "can't afford not to" go forward with Three Waters.
"This reform has been in the pipeline for years and is the result of four years of focused research, modelling and analysis from a range of international and local experts.
"We have listened, amended accordingly, and are now moving forward with reform to deliver safe drinking water, better water and stormwater infrastructure."
Warren-Clark said those who read the proposal would find many of their concerns addressed.
"We cannot keep putting people's lives at risk and we're not going to waste another 20 years talking about the problems."
Tauranga City Council's commission chairwoman Anne Tolley said it was "encouraging to see the Government had accepted most of the Three Waters working group recommendations".
"But there are still some significant issues to deal with around entity formation and governance.
"We will be reviewing the modified proposal in detail and looking closely to see how the concerns expressed by our communities and mana whenua have been accommodated."
Tolley said Three Waters legislation was expected in the middle of this year, and the public and councils would then have the opportunity to provide further feedback.
When asked to respond to the MP's criticism, local government minister Nanaia Mahuta said the reforms were "fundamentally...about delivering clean and safe drinking water at an affordable price".
"With the key issues now addressed, we cannot afford to wait any longer. The costs to communities and ratepayers are just too big to ignore."
Responding to the criticisms, Local Government Minister Nanaia Mahuta said the co-governance arrangement would "mutually reinforce the sustainability of water management and keep public ownership of water entities as a top priority, while prioritising the benefits to all communities big and small".
"Co-governance arrangements exist at the regional representative group level, where 50/50 governance oversight between councils and mana whenua is exercised for the broader wellbeing and benefit of the whole community.
"The decision-making process that ensures that community priorities are reflected, will be at the regional representative group level and also through the establishment of sub-regional groups. It will enable communities to prioritise what is important to them."
Western Bay of Plenty District could have fewer councillors to vote for next election.