>Then why hasn't there been a gTLD reserved for local use?

there is. it's .internal.

https://en.wikipedia.org/wiki/.internal

(note: i hope .lan does not get approved, but people have to understand that they are rolling dice when using unreserved names)

edit: fucking wild that this is downvoted into negatives. press the wiki link and read the first line if you don't believe me. in fact, i will quote it: "The name internal is reserved by ICANN "