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The impact on local government finances of the reservation of land for national parks in local government areas has been a bone of contention. This article analyses the situation. It identifies conditions in which the reservation of land for national parks increases total rateable unimproved property values in a local government area. The level of a local government’s receipts from rates tend to move in the same direction as the total value of rateable property in its local government area. Thus, even though national parks and similar natural areas are not rateable, it is possible that the reservation of some local government areas for such protection, can increase the receipts from rates of the local council concerned. However this is not always so and conditions for an increase in local government revenue are specified. Local governments may wish to maximise their income for discretionary expenditures rather than total receipts. Conditions are specified in which the reservation of` local areas for national parks fosters this objective, and other circumstances in which such reservation is in conflict with this objective. Depending upon the nature of the relevant functions, local government finances may benefit from the existence of national parks in a local government area or be adversely affected by their presence. As far as we are aware, the conditions for this have not been previously specified.


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