The annual meeting was followed by the opening of the LGNZ conference, which closes tomorrow afternoon.
Prime Minister John Key told the 600 delegates from around the country that central government worked closely with local government.
"The relationship we have is a very effective one, I'm frequently in the offices of mayors and councils," he said.
"One of the reasons local government matters in my view is that government at a central level can pass any law it like as long as it gets 61 votes in Parliament. But how it is implemented very much rests with local government and the courts."
Delegates were treated yesterday to tours of the city by Rotorua's councillors, including a trip to Skyline Rotorua and the Redwoods.
At the opening ceremony Rotorua mayor Steve Chadwick said Mr Key's presence was "symbolic of our partnership we're developing with the Crown".
"Rotorua is on a journey of transformation but we're acutely aware everything should be sustainable," she said.
"I'm proud to be mayor of this city and I'm excited by what our council, our people, are achieving together."
Today's sessions include sustainable funding for local government, engaging with iwi to grow economies and understanding what's important to communities.
Conference speakers include Kevin Roberts, executive chairman of Saatchi & Saatchi, David Meates, chief executive of Canterbury District Health Board, and Lester Levy, chief executive of the New Zealand Leadership Initiative.