diff --git a/state/state.go b/state/state.go
index 3b04cd69c..34383cb15 100644
--- a/state/state.go
+++ b/state/state.go
@@ -251,7 +251,7 @@ func (s *State) SetBlockAndValidators(header *types.Header, blockPartsHeader typ
 	// Update validator accums and set state variables
 	nextValSet.IncrementAccum(1)
 
-	nextParams := s.Params.ApplyChanges(
+	nextParams := applyChanges(s.Params,
 		abciResponses.EndBlock.ConsensusParamChanges)
 
 	s.setBlockAndValidators(header.Height,
@@ -263,6 +263,44 @@ func (s *State) SetBlockAndValidators(header *types.Header, blockPartsHeader typ
 
 }
 
+// applyChanges returns a new param set, overriding any
+// parameter that is non-zero in argument
+func applyChanges(p types.ConsensusParams,
+	c *abci.ConsensusParams) types.ConsensusParams {
+
+	if c == nil {
+		return p
+	}
+	res := p
+	// we must defensively consider any structs may be nil
+	if c.BlockSizeParams != nil {
+
+		if c.BlockSizeParams.MaxBytes != 0 {
+			res.BlockSizeParams.MaxBytes = int(c.BlockSizeParams.MaxBytes)
+		}
+		if c.BlockSizeParams.MaxTxs != 0 {
+			res.BlockSizeParams.MaxTxs = int(c.BlockSizeParams.MaxTxs)
+		}
+		if c.BlockSizeParams.MaxGas != 0 {
+			res.BlockSizeParams.MaxGas = int(c.BlockSizeParams.MaxGas)
+		}
+	}
+	if c.TxSizeParams != nil {
+		if c.TxSizeParams.MaxBytes != 0 {
+			res.TxSizeParams.MaxBytes = int(c.TxSizeParams.MaxBytes)
+		}
+		if c.TxSizeParams.MaxGas != 0 {
+			res.TxSizeParams.MaxGas = int(c.TxSizeParams.MaxGas)
+		}
+	}
+	if c.BlockGossipParams != nil {
+		if c.BlockGossipParams.BlockPartSizeBytes != 0 {
+			res.BlockGossipParams.BlockPartSizeBytes = int(c.BlockGossipParams.BlockPartSizeBytes)
+		}
+	}
+	return res
+}
+
 func (s *State) setBlockAndValidators(height int64,
 	newTxs int64, blockID types.BlockID, blockTime time.Time,
 	prevValSet, nextValSet *types.ValidatorSet,
diff --git a/state/state_test.go b/state/state_test.go
index 2c403a425..d560f9532 100644
--- a/state/state_test.go
+++ b/state/state_test.go
@@ -192,6 +192,71 @@ func TestValidatorChangesSaveLoad(t *testing.T) {
 	}
 }
 
+func makeParams(blockBytes, blockTx, blockGas, txBytes,
+	txGas, partSize int) types.ConsensusParams {
+
+	return types.ConsensusParams{
+		BlockSizeParams: types.BlockSizeParams{
+			MaxBytes: blockBytes,
+			MaxTxs:   blockTx,
+			MaxGas:   blockGas,
+		},
+		TxSizeParams: types.TxSizeParams{
+			MaxBytes: txBytes,
+			MaxGas:   txGas,
+		},
+		BlockGossipParams: types.BlockGossipParams{
+			BlockPartSizeBytes: partSize,
+		},
+	}
+}
+
+func TestApplyChanges(t *testing.T) {
+	initParams := makeParams(1, 2, 3, 4, 5, 6)
+
+	cases := [...]struct {
+		init     types.ConsensusParams
+		changes  *abci.ConsensusParams
+		expected types.ConsensusParams
+	}{
+		0: {initParams, nil, initParams},
+		1: {initParams, &abci.ConsensusParams{}, initParams},
+		2: {initParams,
+			&abci.ConsensusParams{
+				TxSizeParams: &abci.TxSizeParams{
+					MaxBytes: 123,
+				},
+			},
+			makeParams(1, 2, 3, 123, 5, 6)},
+		3: {initParams,
+			&abci.ConsensusParams{
+				BlockSizeParams: &abci.BlockSizeParams{
+					MaxTxs: 44,
+					MaxGas: 55,
+				},
+			},
+			makeParams(1, 44, 55, 4, 5, 6)},
+		4: {initParams,
+			&abci.ConsensusParams{
+				BlockSizeParams: &abci.BlockSizeParams{
+					MaxTxs: 789,
+				},
+				TxSizeParams: &abci.TxSizeParams{
+					MaxGas: 888,
+				},
+				BlockGossipParams: &abci.BlockGossipParams{
+					BlockPartSizeBytes: 2002,
+				},
+			},
+			makeParams(1, 789, 3, 4, 888, 2002)},
+	}
+
+	for i, tc := range cases {
+		res := applyChanges(tc.init, tc.changes)
+		assert.Equal(t, tc.expected, res, "case %d", i)
+	}
+}
+
 func makeHeaderPartsResponses(state *State, height int64,
 	pubkey crypto.PubKey) (*types.Header, types.PartSetHeader, *ABCIResponses) {
 
diff --git a/types/params.go b/types/params.go
index 4047913c3..322cba612 100644
--- a/types/params.go
+++ b/types/params.go
@@ -2,8 +2,6 @@ package types
 
 import (
 	"github.com/pkg/errors"
-
-	abci "github.com/tendermint/abci/types"
 )
 
 const (
@@ -18,42 +16,6 @@ type ConsensusParams struct {
 	BlockGossipParams `json:"block_gossip_params"`
 }
 
-// ApplyChanges returns a new param set, overriding any
-// parameter that is non-zero in argument
-func (p ConsensusParams) ApplyChanges(c *abci.ConsensusParams) ConsensusParams {
-	if c == nil {
-		return p
-	}
-	res := p
-	// we must defensively consider any structs may be nil
-	if c.BlockSizeParams != nil {
-
-		if c.BlockSizeParams.MaxBytes != 0 {
-			res.BlockSizeParams.MaxBytes = int(c.BlockSizeParams.MaxBytes)
-		}
-		if c.BlockSizeParams.MaxTxs != 0 {
-			res.BlockSizeParams.MaxTxs = int(c.BlockSizeParams.MaxTxs)
-		}
-		if c.BlockSizeParams.MaxGas != 0 {
-			res.BlockSizeParams.MaxGas = int(c.BlockSizeParams.MaxGas)
-		}
-	}
-	if c.TxSizeParams != nil {
-		if c.TxSizeParams.MaxBytes != 0 {
-			res.TxSizeParams.MaxBytes = int(c.TxSizeParams.MaxBytes)
-		}
-		if c.TxSizeParams.MaxGas != 0 {
-			res.TxSizeParams.MaxGas = int(c.TxSizeParams.MaxGas)
-		}
-	}
-	if c.BlockGossipParams != nil {
-		if c.BlockGossipParams.BlockPartSizeBytes != 0 {
-			res.BlockGossipParams.BlockPartSizeBytes = int(c.BlockGossipParams.BlockPartSizeBytes)
-		}
-	}
-	return res
-}
-
 // BlockSizeParams contain limits on the block size.
 type BlockSizeParams struct {
 	MaxBytes int `json:"max_bytes"` // NOTE: must not be 0 nor greater than 100MB