Benefits of replacing lawn with natives

Picture this: there's a set of tram tracks running down the middle of an inner city road, with a strip of lawn either side. On one side it's pristine, green lawn manicured to a tidy length; on the other, a straggly yellowing mess.

This is the scene at the centre of a turf war in Melbourne over who's responsible for maintaining the nature strip on either side of the road. But could there be a better way to make use of these public pockets of land?