"We are a growing city, the hub of the Waikato economy, and we have built regional strategic partnerships to make sure we grow in the right way and in the right places," she said.
"This long-term strategic planning could be undone through the structures put forward by Government. It makes no sense that the largest growth council, asset owner and population base in the proposed water services entity does not have guaranteed representation at a governance level."
O'Leary told the select committee the reform could halt HCC's success in delivering integrated planning.
"Government has asked us to do better with climate change and our council has just adopted a bold and robust climate change strategy, yet this reform will hamper some of those goals because our water services will be split apart from our strategic planning."
HCC made a formal submission on the Water Services Entities Bill in July calling for the Government to withdraw the bill that would allow the set up of the controversial four mega entities to take over the country's Three Waters services.
The council's submission was formed by the views of more than 1200 submissions from the community.
HCC instead advocates for a smaller regional council-controlled organisation (CCO) model in cooperation with Waikato and Bay of Plenty councils.
The select committee is expected to report back to Parliament in November.