Why local government matters, how states and counties govern, the unique status of tribal nations, and the enduring tensions between national authority and local self-determination
When a child walks to a public school in the morning, she is using a sidewalk that her city built, crossing an intersection regulated by traffic signals her county maintains, and arriving at a building funded primarily by her state government. The curriculum she studies reflects standards set by a state board of education. The teacher standing at the front of the classroom was licensed by a state agency. If there is a fire during the school day, the fire department that responds will be a local one. If there is a public health crisis in the district, it will likely be the county health department that issues guidance and the state health agency that coordinates the response. From the moment a student wakes up to the moment she returns home, her daily life has been shaped not by Congress or the president, but by governments she may never have heard of—governments at the state, county, and municipal level.
This reality points to something that students of government must understand early: government in the United States, and in many countries around the world, does not reside in a single place. National governments set important frameworks—constitutions, federal laws, defense policy, monetary systems, and civil rights protections—but an enormous portion of what government actually does happens closer to home. State governments oversee education, criminal justice, professional licensing, transportation, and social services. County governments administer courts, health programs, land records, and elections. Municipal governments manage water systems, zoning, local policing, parks, and city streets. Tribal governments exercise sovereign authority over their own lands and members.
Yet local and state governments are often poorly understood. Voter turnout in state and local elections is typically far lower than in national elections. Coverage of municipal government in major media is thin compared to coverage of national politics. Civics education historically emphasized federal institutions—Congress, the presidency, the Supreme Court—more than state legislatures, county commissions, or city councils. The result is a democratic knowledge gap: citizens who know little about the levels of government that most directly affect their daily lives.
This chapter addresses that gap. It introduces the structure and functions of subnational government—the governments that exist below the national level—with special attention to the United States but with comparative examples from around the world. It explains why local government matters, how states and provinces differ from national governments in their authority and responsibilities, how counties and municipalities are organized, and what local governments actually do. It also addresses the governance of tribal and indigenous nations, a topic central to American constitutional history.
Understanding subnational government is not simply a matter of learning about additional government offices. It requires grasping a fundamental feature of how political authority is organized in large and complex societies. The question of which level of government should handle which problems—public education, policing, land use, environmental protection, social welfare, public health—is one of the most contested and consequential questions in democratic governance. The answers shape equality, efficiency, responsiveness, and freedom. No serious student of government can ignore them.
Imagine walking through a neighborhood in any city in the United States. The streets are paved, the traffic lights are timed, the fire hydrants are placed at regular intervals, the garbage is picked up on a schedule, and the park at the end of the block is maintained by a crew that works for the city. The elementary school around the corner is a public school funded primarily by the state and local property taxes. If a crime is committed in that park, a local police officer will respond. If a resident becomes sick from contaminated water, the county health department will investigate. If a developer wants to build a new apartment complex, the zoning board will hold a public hearing.
Every one of these functions belongs to subnational government—government that exists below the national level. The word "subnational" sounds technical, but it describes something familiar: the governments closest to where people actually live. These governments are not simply smaller versions of the federal government. They have distinct constitutional histories, different funding mechanisms, separate powers and responsibilities, and in many cases closer relationships with the daily lives of citizens than any federal agency.
The most fundamental answer to the question of why local government exists is practical: national governments cannot efficiently manage every public problem in a large and geographically diverse country. The needs of a small farming community in rural Kansas differ from the needs of a dense urban neighborhood in Chicago. The challenges of coastal infrastructure in Louisiana differ from the challenges of water management in Arizona. A single national agency trying to address all of these problems from Washington would face enormous difficulties gathering information, responding to local conditions, accommodating diverse preferences, and assigning accountability.
Local governments are closer to the problems they manage. They can respond more quickly, gather local information more effectively, and adapt their approaches to local conditions. In principle, they are more accountable to residents because residents can attend city council meetings, vote in local elections, contact their county commissioner, or run for the school board themselves. The distance between a citizen and her local government is far shorter than the distance between a citizen and the federal government.
There is also a democratic argument for local government: self-governance. The idea that communities should have meaningful control over the decisions that most directly affect them—their schools, their streets, their neighborhoods, their local laws—is central to the tradition of local democracy. This is not merely an efficiency claim; it is a claim about freedom and civic dignity. Communities that govern themselves develop the habits, institutions, and civic culture that sustain democracy. Alexis de Tocqueville, the French political thinker who wrote extensively about American democracy in the 1830s, argued that local government was the nursery of democratic life—the place where citizens learned through practice how to govern themselves.
The scale of subnational government in the United States is difficult to overstate. There are 50 state governments, each with its own constitution, legislature, governor, court system, and administrative apparatus. Below the states, there are approximately 3,000 county governments, more than 19,000 municipal governments (cities, towns, villages, boroughs), roughly 16,000 townships, over 13,000 school districts, and more than 35,000 special districts—entities created to manage specific functions like water supply, fire protection, mosquito control, or hospital districts. The total number of distinct governmental units in the United States exceeds 90,000.
These governments together employ millions of people and spend trillions of dollars annually. State and local government employment collectively dwarfs federal civilian employment. Teachers, police officers, firefighters, social workers, public health nurses, road crews, building inspectors, librarians, and park rangers are almost all employed by state or local governments, not the federal government. When most citizens interact with a government employee in their daily lives, they are interacting with someone who works for a subnational government.
| Type of Governmental Unit | Approximate Count (U.S.) | Primary Function |
|---|---|---|
| State governments | 50 | Education, criminal law, civil law, health, infrastructure |
| County governments | ~3,000 | Courts, elections, health, property records, roads |
| Municipal governments | ~19,000 | Local policing, zoning, utilities, parks, local ordinances |
| Township governments | ~16,000 | Rural roads, property assessment, code enforcement |
| School districts | ~13,000 | Public K–12 education administration |
| Special districts | ~35,000 | Water, fire, transit, hospitals, parks (single-function) |
Despite the scale and importance of subnational government, civic participation in local elections is often discouragingly low. Voter turnout in mayoral elections in major U.S. cities sometimes falls below 20 percent. School board elections, which determine educational policy for millions of children, often draw only a small fraction of eligible voters. County commissioner races, which govern major public services and spending, frequently go uncontested or receive minimal attention.
This turnout gap has consequences. When fewer people vote in local elections, organized interests—business groups, public employee unions, real estate developers, and ideologically motivated networks—gain disproportionate influence over local decisions. The accountability mechanism that is supposed to make local democracy more responsive than distant national government can break down when citizens disengage. Understanding why local government matters is a first step toward closing this participation gap.
In federal systems around the world, the most powerful subnational units are the first-level divisions: states in the United States, Mexico, Australia, and India; provinces in Canada and South Africa; Länder in Germany; cantons in Switzerland; and autonomous communities in Spain. These units are not simply administrative subdivisions of the national government. In genuine federal systems, they have independent constitutional status, their own elected governments, their own powers and responsibilities, and in some cases their own constitutions.
In the United States, the 50 states are constitutionally significant entities. They existed before the federal government: the original 13 colonies became states before ratifying the Constitution that created the national government. The Tenth Amendment to the U.S. Constitution reserves to the states (or the people) all powers not delegated to the federal government or prohibited to the states. This constitutional provision reflects the founding understanding that states are not subordinate administrative units but sovereign partners in a federal arrangement.
Every U.S. state has its own constitution. State constitutions share some features with the federal Constitution—they create separation of powers among legislative, executive, and judicial branches, establish a bill of rights, and provide mechanisms for constitutional amendment—but they often go much further in detail, length, and specificity.
The federal Constitution is notably brief: approximately 7,600 words in its original text, with 27 amendments added over more than two centuries. State constitutions are frequently far longer. Alabama's constitution has historically run to hundreds of thousands of words. California's constitution is one of the longest in the world for a subnational government. State constitutions often specify details about taxation, education, natural resources, environmental protection, agricultural policy, and local government that the federal Constitution leaves entirely to legislative discretion.
State constitutions are also amended more frequently than the federal Constitution. Because the amendment threshold in many states is lower than the two-thirds of Congress and three-quarters of states required to amend the federal document, state constitutions tend to accumulate provisions reflecting shifting political majorities and policy preferences. Some scholars argue this makes state constitutions more democratic and responsive; others argue it makes them cluttered, inconsistent, and difficult to understand.
The scope of state government authority is enormous. States bear primary responsibility for public K–12 education, setting curriculum standards, teacher certification requirements, testing frameworks, and much of the funding through state aid formulas. The vast majority of criminal laws in the United States are state laws—homicide, assault, robbery, theft, drug offenses, and property crimes are defined and prosecuted under state law. State courts handle the overwhelming majority of criminal cases, and state prisons house most of the country's incarcerated population.
Civil law—contracts, property, torts, family law, and probate—is primarily governed by state statutes and state court decisions. The United States effectively has 50 largely independent systems of civil law, a fact that distinguishes American law from many other countries with unified civil codes. States also administer Medicaid, operate public mental health systems, license health care providers, fund public health departments, build and maintain the state highway system, and regulate business practices, insurance, utilities, and professional licensing.
Perhaps most significantly for democratic life, states have primary constitutional responsibility for administering federal elections within their borders—setting voter registration rules, polling place procedures, ballot design, and local election administration. The Constitution gives Congress authority to regulate federal elections, but states retain wide discretion.
State governments are fully formed political systems. Each state has a legislature (bicameral in 49 states, unicameral in Nebraska), a governor, a cabinet and executive agencies, a state court system including a supreme court, and a vast administrative apparatus. State budgets run into the hundreds of billions of dollars for large states like California, New York, and Texas. Governors sign or veto legislation, prepare budget proposals, command the state's National Guard in domestic emergencies, make appointments to state agencies and courts, and exercise significant leadership over their party's policy agenda.
In Germany, the Länder are powerful subnational units in a genuine federal system. They administer most federal laws, control their own education systems, run their police forces, and have significant representation in the Bundesrat—the upper house of the German parliament, composed of representatives of state governments. German federalism is sometimes described as "cooperative federalism" because the Länder typically administer national policies rather than setting completely independent policies.
In Canada, provinces have extensive autonomous powers over natural resources, education, health care, and civil law. Quebec's distinctive legal system (based on French civil law) and linguistic status illustrate how provincial autonomy can accommodate cultural difference within a federal system. The federal-provincial relationship is mediated through intergovernmental conferences and fiscal transfer arrangements.
India's federal structure is often described as "quasi-federal" because the central government retains stronger powers over states than in the U.S. or German models, including the power to impose President's Rule and dismiss state governments in emergencies. In practice, however, Indian state governments exercise considerable practical autonomy, particularly since the economic liberalization of the 1990s.
In unitary systems such as France, regional and departmental governments exist but derive their authority from national legislation rather than constitutional guarantees. In the United Kingdom, Scotland, Wales, and Northern Ireland have significant devolved powers created by Acts of Parliament—authority that could in theory be reversed by Parliament. These examples illustrate the fundamental distinction between federal and unitary approaches to distributing power across territory.
Counties are the primary administrative subdivisions of states in most of the United States. The 3,000+ counties vary enormously in size, population, wealth, and structure. Los Angeles County in California has a population exceeding 10 million people—larger than most countries. Loving County in Texas has fewer than 200 residents. Most counties fall somewhere in between. County governments perform a mix of state-mandated functions and locally determined services, typically including courts and criminal justice, property records, elections administration, health and human services, road maintenance, property assessment and taxation, and a range of social services administered as agents of the state.
County governments are typically governed by a county commission or board of supervisors—a small elected body that sets policy and approves budgets. Many other county officers—sheriff, clerk, treasurer, assessor, district attorney—are separately elected, which distributes accountability but can also fragment authority and create coordination challenges. Louisiana uses parishes rather than counties, reflecting its French and Spanish colonial heritage. Alaska uses boroughs.
Municipalities—legally chartered cities, towns, villages, and boroughs—are created by state governments through a process of incorporation. Unlike counties, which exist throughout state territory automatically, municipalities are created by the deliberate decision of a community to seek incorporated status. Incorporated municipalities typically have the authority to establish and enforce local ordinances, create and manage police departments, provide water and sewer services, regulate land use through zoning, issue building permits, maintain city streets and parks, collect property taxes and other local revenue, and operate libraries and recreation centers.
The structure of municipal government varies considerably. Mayor-council systems are the most common: an elected mayor serves as the chief executive and an elected city council serves as the legislative body. In strong-mayor systems, the mayor has broad appointment and budget powers. In weak-mayor systems, the council holds more authority. Council-manager systems, common in medium-sized cities, feature an elected council that hires a professional city manager to run day-to-day operations, removing administrative management from direct electoral politics.
City size shapes what a municipality does and how it governs. A small town of 2,000 people may have a part-time mayor, a tiny police force, and a volunteer fire department. A large city like New York, Chicago, or Houston is a governmental system of enormous complexity—managing a police department larger than many national armies, a transit system used by millions daily, a public school system employing tens of thousands of teachers, and a budget measured in tens of billions of dollars.
Zoning is the legal process through which local governments divide their territory into zones or districts and regulate what kinds of land uses, buildings, and activities are permitted in each zone. A residential zone may allow single-family houses but prohibit factories. A commercial zone may permit retail stores but not heavy industry. An industrial zone may allow manufacturing facilities but not residences.
Zoning is one of the most powerful tools local government exercises, because it shapes what gets built, where development occurs, how neighborhoods look and function, who can afford to live in a community, and what kinds of economic activity are possible. Zoning decisions are made by local planning boards, zoning boards, and city councils, often after public hearings.
Zoning is also one of the most contested areas of local policy. Critics argue that exclusionary zoning—using minimum lot sizes, prohibitions on multi-family housing, or other restrictions—has been used to keep lower-income residents and racial minorities out of certain neighborhoods. Defenders argue that zoning protects property values, neighborhood character, and public safety. In recent years, many states have moved to restrict local zoning authority in response to housing affordability crises, requiring cities to allow more dense development near transit corridors.
One of the most important legal principles governing the relationship between states and their local governments is known as Dillon's Rule, named for Judge John Dillon, who articulated it in an 1868 Iowa court ruling. Dillon's Rule holds that local governments are creatures of the state—they have only those powers that the state legislature explicitly grants them or that are necessarily implied from granted powers. Under Dillon's Rule, if a local government wants to do something the state has not authorized, it cannot, even if it seems sensible and the community wants it.
Dillon's Rule has been significantly modified in many states through the adoption of home rule provisions. Home rule gives municipalities greater autonomy to govern themselves without requiring specific state legislative authorization for every action. Under strong home rule, cities and counties can exercise any governmental power that the state has not specifically prohibited. Under weaker versions, home rule applies only in certain domains.
The tension between Dillon's Rule and home rule reflects a deeper tension about the nature of local government: is it a subordinate administrative agent of the state, or is it a genuinely self-governing community with independent democratic legitimacy? Both traditions have deep roots in American political thought and legal history. The practical stakes are significant: whether a city can raise the minimum wage, ban certain firearms, protect undocumented immigrants from deportation cooperation, or require paid sick leave often depends on which rule governs its relationship with the state.
Local democracy is sustained by an enormous number of elections. Americans vote not only for president, members of Congress, governors, and state legislators, but also for mayors, city council members, county commissioners, sheriffs, county clerks, prosecutors, judges, school board members, water district directors, library board trustees, and more. The number of elected offices in the United States—estimated at more than half a million—is higher than in virtually any other democratic country. This reflects the American tradition of using elections as the primary mechanism of democratic accountability.
Local elections take multiple forms. They may be partisan (candidates appear on the ballot with party labels) or nonpartisan (no party labels appear). Nonpartisan elections, common for city councils, school boards, and judicial races, were promoted in the Progressive Era as a way to reduce the influence of party machines and professional politicians. Critics now argue that nonpartisan elections reduce voters' ability to make sense of races they know little about, and that they may actually favor candidates with access to established community networks—often meaning incumbents and candidates backed by business interests.
Local elections are typically held on different cycles from state and federal elections. Many jurisdictions hold local elections in odd-numbered years, on spring dates, or on other off-cycle schedules. This scheduling is partly historical, but its effect is to reduce turnout further by separating local elections from the higher-salience contests that drive participation. Research suggests that when local elections are moved to coincide with state or federal general elections, turnout rises substantially.
The mayor is the elected chief executive of a municipal government. The powers of mayors vary greatly by city charter. Strong mayors appoint department heads, prepare the budget, and have veto power over council legislation. Weak mayors have more limited executive authority and share power more extensively with the council. The city council is the primary legislative body of a municipal government, passing ordinances, approving budgets, setting tax rates, and providing oversight of city administration.
The county commission or board of supervisors is the primary governing body of county government, setting county policy, approving budgets, and managing county departments. The county sheriff is typically an elected law enforcement official responsible for policing in unincorporated areas, maintaining the county jail, serving court process, and executing judicial orders. The elected status of the sheriff distinguishes American county law enforcement from most other democratic countries.
School boards are elected bodies that govern local school districts. They hire the superintendent, approve curriculum frameworks, set school district budgets, adopt personnel policies, and set general educational direction. School board elections, once relatively low-profile local affairs, have in recent years become highly contested battlegrounds over curriculum, library books, and educational philosophy. Judicial elections are common in many states; critics argue that campaigning for donations and votes threatens judicial independence, while supporters argue that elections hold judges accountable to the public.
Public education in the United States is organized primarily at the local level through school districts, though states play a dominant role in funding and policy. The approximately 13,000 school districts in the country vary enormously in wealth, size, and quality. The primary source of local school funding is the property tax. Because property values vary widely across communities, a wealthy suburb with expensive homes can generate far more tax revenue per pupil than a poor rural community, even at the same tax rate. This creates profound inequality in educational resources across districts.
Courts in many states have ruled that heavy reliance on local property taxes to fund schools violates state constitutional guarantees of equal education, and state funding formulas have been designed to equalize resources—with varying success. State governments set the basic policy frameworks within which local school districts operate: academic standards, graduation requirements, teacher certification and licensure, school safety regulations, and statewide testing and accountability systems. Federal funding through Title I and the Individuals with Disabilities Education Act provides a smaller share of education funding but comes with significant policy requirements.
Local police departments are responsible for most law enforcement in the United States. There are approximately 18,000 law enforcement agencies in the country, the overwhelming majority of them local. Municipal police departments, county sheriff's offices, and township constabularies together employ the bulk of the nation's sworn police officers. Local control of policing is deeply embedded in American tradition, but it creates a fragmented system in which policing standards, training requirements, accountability mechanisms, and use-of-force policies vary enormously from jurisdiction to jurisdiction.
State governments set minimum standards for police officer training and certification. The federal government can investigate patterns of unconstitutional policing through the Civil Rights Division of the Department of Justice and negotiate consent decrees that require reforms in problematic departments. But primary accountability for local police remains with local governments—mayors, city councils, county executives, and elected sheriffs—making the quality of local democratic engagement central to police accountability.
Local governments manage most of the physical infrastructure of daily life: streets, sidewalks, traffic systems, parks, public buildings, water and sewer systems, stormwater drainage, and public transit in larger cities. The condition of local infrastructure directly affects quality of life, economic development, public health, and safety. Infrastructure is one of the most funding-challenged areas of local government. Cities with shrinking tax bases face difficulty maintaining aging systems. The water crisis in Flint, Michigan—in which aging pipes leached lead into the public water supply, resulting in widespread lead poisoning of children—demonstrated how catastrophically the failure of local and state infrastructure management can harm a community.
Local ordinances must comply with state and federal law. A city cannot enact an ordinance that violates state preemption—if the state has fully occupied a field of law, the city may be prohibited from regulating in that area at all. Many states have preempted local governments from enacting their own gun regulations, minimum wage laws, or immigration enforcement policies. The tension between local autonomy and state preemption is one of the most active areas of contemporary local government law.
Tribal governments occupy a unique position in American political life that is different from state and local governments in fundamental ways. The legal status of tribal nations in the United States is not derived from the Tenth Amendment or from state charters of incorporation. It derives from centuries of treaties, federal statutes, executive orders, court decisions, and the inherent sovereignty of indigenous peoples as political communities that existed before the United States. More than 570 federally recognized tribes exercise governmental authority over their members and territories. This federal recognition means the U.S. government has formally acknowledged the tribe as a sovereign political entity with a government-to-government relationship with the United States.
The foundation of tribal governance in American law is the concept of tribal sovereignty: the inherent right of tribal nations to govern themselves. The Supreme Court articulated the basic framework in a series of decisions by Chief Justice John Marshall in the early nineteenth century, most notably Cherokee Nation v. Georgia (1831) and Worcester v. Georgia (1832). Marshall described tribes as "domestic dependent nations"—sovereign entities with self-governing authority over their internal affairs and members, but existing within the borders and under the protective responsibility of the United States.
These foundational cases also established the principle that only the federal government, not states, can deal with tribal nations. States generally cannot regulate tribal activity on tribal lands without congressional authorization. This means that tribal governments exist in a unique constitutional space, neither subordinate to state governments like cities and counties, nor fully equivalent to states themselves.
Congress has plenary power over tribal affairs—a broad authority to modify tribal governance by legislation. This power has been exercised inconsistently throughout American history. Federal policies in the nineteenth and early twentieth centuries, including forced relocation, the allotment of tribal lands to individual ownership, and the suppression of tribal languages and cultures, severely damaged tribal political and social institutions. The Indian Reorganization Act of 1934 reversed some of these policies and encouraged tribal constitutions and governmental structures. The self-determination policy, codified in the Indian Self-Determination and Education Assistance Act of 1975, gave tribes greater control over federal programs affecting their communities.
Federally recognized tribes exercise extensive governmental authority. Tribal governments may enact tribal laws and codes; operate tribal courts with civil and criminal jurisdiction; tax activities on tribal lands; license and regulate businesses on tribal territory; administer social services, health programs, and education; manage natural resources including water rights, hunting and fishing rights, and mineral extraction; operate gaming enterprises under the federal Indian Gaming Regulatory Act of 1988; maintain tribal police forces; and manage tribal land and housing.
The scope of tribal governmental authority varies enormously. Large, well-resourced tribes such as the Navajo Nation, the Cherokee Nation, and the Osage Nation have developed sophisticated governmental systems with multiple branches, professional administrations, and significant economic capacity. Smaller or less-resourced tribes may have more limited governmental infrastructure. The scope of tribal jurisdiction over non-Indians on tribal lands has also been the subject of extensive and evolving federal court interpretation.
Tribal courts have civil jurisdiction over disputes involving tribal members and, in some circumstances, non-members who voluntarily enter tribal territory. Criminal jurisdiction is more complex. The Violence Against Women Act of 2013 and its reauthorization restored limited criminal jurisdiction for tribal courts over non-Indians who commit domestic violence against Indian women on tribal land—an important step in addressing the severe crisis of violence against Native American women, which federal and state agencies have historically failed to address adequately.
The ongoing evolution of tribal court jurisdiction reflects both the vitality of tribal sovereignty and the contested nature of its boundaries in a nation where state and federal systems also assert jurisdiction over much of the same territory.
Tribal governments face distinctive challenges. Tribal communities often have higher rates of poverty, lower life expectancy, and fewer public services than surrounding non-tribal communities—a legacy of historical dispossession, displacement, and federal neglect. Access to health care, quality education, housing, and economic opportunity remains unequal on many reservations. At the same time, tribal governments have exercised their sovereignty creatively in recent decades. Tribal enterprises—gaming, hospitality, manufacturing, renewable energy—have generated revenue that some tribes have invested in expanded public services and governance capacity. Tribal colleges and universities have grown in number and quality. Tribal cultural programs have helped preserve languages and traditions. Tribal environmental programs have asserted indigenous governance over natural resources in ways that sometimes exceed state and federal environmental standards.
The relationship between tribal governments and the states that surround them remains contested. Water rights in the arid West, gaming regulation, highway jurisdiction, tax authority, and cross-jurisdictional law enforcement are areas of frequent conflict and ongoing negotiation.
Canada has three categories of indigenous peoples: First Nations, Métis, and Inuit. Indigenous governance is recognized in the Constitution Act of 1982, which affirms "existing aboriginal and treaty rights." First Nations governments exercise authority over education, housing, social services, and in some cases land use on reserve lands. In recent years, First Nations have asserted increased governance authority through land claims settlements, self-government agreements, and constitutional litigation.
New Zealand has a distinctive constitutional relationship with the Māori people through the Treaty of Waitangi, signed in 1840 between the British Crown and Māori chiefs, considered the founding constitutional document of New Zealand. Māori have reserved seats in the New Zealand Parliament and have used treaty settlements to reclaim governance authority over fisheries, lands, and cultural resources.
Spain accommodates regional nationalist movements through a system of autonomous communities with significant self-governing powers. The Basque Country and Catalonia have the most extensive autonomous powers, including control over their own police forces, education systems, and tax collection. Catalan demands for full independence have created major constitutional crises, including the 2017 independence referendum that the Spanish Constitutional Court ruled illegal.
These examples illustrate that the governance of distinct peoples and regions within larger states is a universal challenge with varied solutions. No single model has proven universally applicable, and each system reflects the particular historical circumstances, power relations, and constitutional traditions of its country.
Local and state governments fund their operations through a variety of revenue sources, each with its own political economy, distributional effects, and administrative challenges. Property taxes are the primary revenue source for most local governments, particularly school districts and counties. Property taxes are levied on the assessed value of real estate. Because property values vary widely across communities, property tax revenue is highly unequal—a chronic source of inequity in public service provision.
Sales taxes are collected by states and, in many states, also by counties and municipalities. They are administratively simple and generate stable revenue, but they are often criticized as regressive because lower-income households spend a higher share of their income on taxable consumption. Income taxes are used by some states and a smaller number of municipalities. Fees and charges—water bills, sewer charges, park fees, permit fees, transit fares—are a substantial revenue source for many local governments.
Intergovernmental transfers are funds that flow from higher levels of government to lower levels. States transfer large amounts of money to local governments, particularly for education. The federal government transfers funds through block grants, categorical grants, and formula-based programs. Federal grants-in-aid are a major component of state and local budgets for programs like Medicaid, transportation, housing, and education—but they typically come with policy conditions attached.
| Revenue Source | Primary Users | Key Characteristics |
|---|---|---|
| Property tax | Counties, school districts, municipalities | Tied to real estate value; creates inequality across communities |
| Sales tax | States, some counties and cities | Stable, simple; regressive; applies at point of purchase |
| Income tax | States, some cities | Can be progressive; more variable with economic cycles |
| Fees and charges | All local governments | Tied to specific service use; supplements taxes |
| Intergovernmental transfers | All levels | May carry policy conditions; equalizes resources across jurisdictions |
Local governments prepare annual or biennial budgets that estimate revenues, project expenditures, and allocate resources across programs and departments. Most local governments are constitutionally or statutorily required to adopt balanced budgets—they cannot legally spend more than they take in each year. This requirement differs from the federal government, which can run annual deficits. The balanced budget requirement means local governments must respond to revenue shortfalls by cutting expenditures, raising taxes, drawing on reserves, or seeking additional intergovernmental aid. Local budget decisions are inherently political: every budget allocates scarce resources among competing priorities, and budget hearings are one of the most direct opportunities for citizens to influence local policy.
In addition to general-purpose governments, the United States has more than 35,000 special districts—government entities created to perform a single function or a limited set of functions within a defined geographic area. Common types include school districts, water districts, fire protection districts, hospital districts, transit authorities, park districts, and mosquito abatement districts. Special districts are created by state law and typically governed by a board of directors, sometimes elected and sometimes appointed. They have authority to levy taxes, issue bonds, and collect fees within their service area.
Special districts exist because certain public services are most efficiently provided at a geographic scale that does not correspond to existing municipal or county boundaries. A water system may serve multiple municipalities more efficiently than each city operating its own. A transit system naturally spans many jurisdictions. The proliferation of special districts has been criticized for creating excessive governmental fragmentation, increasing the number of elections to an unmanageable level, reducing transparency and accountability, and making regional coordination on shared problems more difficult. Reformers have periodically advocated for consolidating special districts with general-purpose governments, though consolidation faces political resistance from existing stakeholders.
The United States constitutional system creates a constant tension between national authority and local autonomy. National standards promote equality, efficiency, and rights protection across a diverse country. Local autonomy promotes democratic self-governance, adaptation to local conditions, and protection against overbearing national power. These values frequently conflict, and the history of American government includes centuries of conflict over which level of government should prevail on which questions.
Preemption occurs when a higher level of government—federal or state—enacts law or regulation that takes precedence over local law in the same area. Federal law is supreme under the Supremacy Clause of the U.S. Constitution; when Congress or federal agencies regulate an area, conflicting state or local law is preempted. States can similarly preempt local governments from regulating in areas that the state occupies.
Preemption has become increasingly controversial in recent years as states have used it to prevent cities from adopting progressive policies. Examples of contested preemption issues include states preempting cities from raising the local minimum wage, preempting local gun regulations, preempting local ordinances protecting undocumented immigrants, and preempting local environmental regulations that exceed state standards. Federal preemption has applied to state drug regulations, labeling requirements, and financial regulations.
Defenders of preemption argue that uniform standards are necessary to prevent a patchwork of conflicting rules that burden businesses and create inequality across jurisdictions. Critics argue that preemption strips communities of the ability to govern themselves and is often used to prevent local majorities from enacting policies that state-level majority coalitions oppose.
An unfunded mandate occurs when a higher level of government requires a lower level to perform a function or meet a standard without providing sufficient funding to cover the cost. The federal government mandates that states comply with the requirements of the Americans with Disabilities Act, maintain certain environmental standards, and provide certain protections to students with disabilities—all legitimate policy goals, but all imposed on states and localities with limited federal funding. States similarly impose mandates on local governments. The Unfunded Mandates Reform Act of 1995 attempted to limit the federal practice by requiring Congressional Budget Office analysis of significant mandates before legislation passes, but has not eliminated the practice.
Federal grants to states and localities are a major mechanism of federal influence over subnational policy. When the federal government provides funding through categorical grants or block grants, it can attach requirements that shape how states and localities use the money. The 1984 National Minimum Drinking Age Act is one of the most famous examples: Congress conditioned federal highway funds on state compliance with a minimum drinking age requirement of 21. Every state eventually complied. The Supreme Court upheld this approach in South Dakota v. Dole (1987), ruling that using grant conditions to encourage state policy choices was a legitimate exercise of the Spending Clause—as long as the conditions were not "coercive."
The line between permissible encouragement and unconstitutional coercion was addressed again in NFIB v. Sebelius (2012), the case challenging the Affordable Care Act. The Court struck down the ACA's Medicaid expansion provision as coercive because it threatened to withhold all existing Medicaid funding—not just new expansion funding—if states refused to expand eligibility. Seven justices agreed this crossed the line from inducement into compulsion, illustrating how the conditional grant mechanism has constitutional limits.
One of the most important reasons for national standards is the protection of civil rights. The history of American federalism includes a dark chapter in which states and localities used their autonomy to enforce racial segregation, deny voting rights, exclude minorities from economic opportunity, and resist federal enforcement of constitutional rights. The Civil War Amendments—the Thirteenth, Fourteenth, and Fifteenth—were explicitly designed to give the federal government authority to protect individual rights against state violation. Federal civil rights laws, including the Civil Rights Act of 1964, the Voting Rights Act of 1965, the Fair Housing Act of 1968, and the Americans with Disabilities Act of 1990, significantly limit what states and localities can do in employment, public accommodations, voting, housing, and public facilities.
The lesson of this history is that local autonomy, while valuable, is not an absolute good. When local majorities oppress minorities, when local governments violate constitutional rights, or when local policies produce inequalities that undermine equal citizenship, national standards and national enforcement are legitimate—indeed, constitutionally required.
One contemporary manifestation of the national-local tension is the conflict over so-called "sanctuary city" policies. Several cities and counties have adopted policies that limit their cooperation with federal immigration enforcement—instructing local police not to inquire about immigration status, declining to hold individuals beyond their criminal sentences to facilitate deportation, or refusing to dedicate local resources to enforcing federal immigration law.
The federal government has argued that these policies obstruct federal immigration law and has threatened to withhold federal grants from non-cooperating jurisdictions. Courts have generally ruled that the federal government cannot commandeer state and local officials to enforce federal law—the "anti-commandeering doctrine" established in Printz v. United States (1997). While federal law is supreme, the federal government cannot conscript state and local officers into federal enforcement service. The sanctuary city debate turns on the difference between a state or city refusing to cooperate with federal enforcement (generally permissible) and a state or city obstructing federal enforcement (not permissible).
The Chicago City Council is one of the oldest and most storied legislative bodies in American municipal government. With 50 alderpersons, each representing one of the city's 50 wards, it is one of the largest city councils in the United States relative to city size. The council exercises broad legislative authority under the Illinois home rule framework. It passes city ordinances, approves the city budget, authorizes bond issuances, sets tax rates, creates city agencies, and confirms mayoral appointments. The council has committees covering finance, zoning, housing, transportation, public safety, health, education, and other major policy areas.
Chicago's council has historically been characterized by strong aldermanic privilege—the informal norm that a ward's alderperson controls land use and zoning decisions within their ward, with other council members deferring. This system gives individual council members considerable local power but has also been associated with corruption and patronage, as it places enormous discretionary authority in the hands of individual elected officials with limited public transparency.
In recent years, the council has been the site of significant policy battles over police accountability, minimum wage increases, affordable housing, school closures, and the use of federal pandemic relief funds. The council's relationship with the mayor has varied from cooperative to confrontational, depending on political alignments and the mayor's own approach to council relations. The Chicago City Council illustrates the complexity of urban democratic governance: a body simultaneously representing diverse neighborhood interests, managing major public resources, checking executive power, and navigating the politics of a large, racially and economically divided city.
In the mid-nineteenth century, American courts grappled with a fundamental question about local government: where does municipal authority come from, and how far does it extend? Judge John Forrest Dillon of the Iowa Supreme Court articulated what became the dominant principle of American local government law in his 1868 ruling. The case arose from a dispute about whether a city could exercise a power not explicitly granted by the state legislature. Dillon's answer shaped American local government for more than a century and continues to govern in many states today.
Dillon articulated that municipal corporations—cities and towns—possess only the powers that the state legislature expressly grants, powers necessarily implied from those granted, and powers indispensable to the declared objects and purposes of the corporation. Any fair, reasonable, or substantial doubt concerning the existence of a power in a municipal corporation should be resolved against the corporation.
Dillon's Rule treats local government as a dependent creature of the state, with no inherent powers beyond what state law authorizes. This approach reflects a particular view of sovereignty: that ultimate authority rests with the state, not with the local community. It has had profound consequences for the scope of local government authority. Under Dillon's Rule, a city that wants to regulate food trucks, require paid sick leave, ban plastic bags, or establish a municipal broadband network must first determine whether state law authorizes such action. If state law is silent, the city cannot act.
The issue: More than two dozen states have enacted laws that prohibit cities and counties from setting a minimum wage higher than the state minimum wage. This debate pits state legislative authority and business uniformity against local democratic responsiveness and adaptation to local economic conditions.
Local minimum wage variations create significant problems for businesses that operate across multiple jurisdictions within a state. A regional employer with locations in multiple cities faces compliance burdens if each city sets different wage floors. Uniform state standards ensure that workers across a state receive equal protections and that businesses compete on equal terms. Moreover, state legislatures are elected by all residents of the state—including those in cities—and have legitimate authority to set statewide economic policy. Cities should not be permitted to make economic policy decisions with effects that spill over their borders.
The cost of living in cities is often substantially higher than in rural areas. A minimum wage adequate for a rural community may leave workers in a major city unable to afford rent or food. Local governments are closer to their residents and can calibrate policy to local conditions. Preemption laws are often driven by business lobbying at the state level, using state power to override the preferences of city residents and their elected representatives. In a democracy, majorities in a city should have the right to set local standards that reflect local economic realities.
Uniformity and business certainty versus local democratic responsiveness and adaptation to local conditions. State legislative authority versus city self-governance. Policy equity across jurisdictions versus policy variation reflecting community preference. There is no resolution to this tension that maximizes all values simultaneously—any answer requires a judgment about which values should take precedence.
Voting in local elections is one of the most direct forms of civic participation available to most citizens. Local elections determine who will govern schools, set police policy, manage public water systems, zone land for development or preservation, and allocate local tax revenue. Yet local election turnout is frequently a fraction of national election participation.
The right to vote in local elections is protected by the same constitutional and statutory framework that protects the right to vote in federal and state elections. The Fifteenth, Nineteenth, and Twenty-Sixth Amendments protect voting rights from discrimination based on race, sex, and age. The Voting Rights Act applies to local elections. The civic responsibility that corresponds to this right is active participation. Citizens who do not vote in local elections surrender their voice over the decisions that most directly affect their neighborhoods, schools, and daily services.
Civic engagement in local government takes forms beyond voting: attending city council meetings, commenting on proposed zoning changes, participating in school board hearings, serving on citizen advisory committees, volunteering for local election administration, or running for office. Local government is the most accessible level of democratic self-governance—but only if citizens choose to engage with it.
A state supreme court has ruled that the current system of funding public schools primarily through local property taxes creates unconstitutional inequalities in educational opportunity. Districts in wealthy areas spend two to three times more per pupil than districts in poor areas. The legislature must redesign the school funding system to meet the constitutional requirement of educational equity.
Students and families in low-wealth districts who currently receive less educational funding; students and families in high-wealth districts who may face reduced funding under equalization; local school boards and superintendents; state legislators facing political pressure from both wealthy and poor communities; teachers unions; the business community concerned about workforce preparation; and taxpayers in high-wealth districts who pay significant local property taxes.
Current per-pupil spending by district; property tax base by district; student achievement data; cost-of-education factors by geography; experience of other states that have reformed school funding systems; analysis of how each option affects local control and community attachment to neighborhood schools.
Recommend a school funding approach for the state. Explain why you chose this approach, what tradeoffs it involves, who benefits and who bears costs, and what safeguards or conditions you would attach to the recommendation. Consider both equity and local democratic governance in your analysis.
Context: Many state constitutions include provisions guaranteeing public education. These provisions have been the basis for litigation challenging school funding systems in dozens of states. The New Jersey Supreme Court, in the Abbott v. Burke series of decisions beginning in 1985, held that the New Jersey Constitution's guarantee of a "thorough and efficient" education required the state to ensure adequate funding in the state's poorest school districts.
Paraphrase of New Jersey Constitution, Article VIII, Section IV: The legislature shall provide for the maintenance and support of a thorough and efficient system of free public schools for the instruction of all the children in the State between the ages of five and eighteen years.
Questions for Analysis:
1. What does the phrase "thorough and efficient" mean as a constitutional standard? Is it a clear standard, or does it require judicial interpretation? Who should do that interpreting?
2. The New Jersey Supreme Court ruled that a school funding system resulting in dramatically different educational opportunities violates this constitutional guarantee. Do you agree with this interpretation? Why or why not?
3. How does this state constitutional provision interact with local control of education through local school boards and property-tax funding? What tension does it reveal between state constitutional mandates and local democratic governance?
4. Compare this provision with the U.S. Constitution, which contains no explicit guarantee of public education. What does it mean for the governance of education that this right is guaranteed by many state constitutions but not the federal Constitution?
5. What remedies would be available if a state fails to comply with its own constitutional education guarantee? Who would enforce it, and what institutional tools are available?
Select two countries with different forms of subnational government—for example, the United States (federal) and France (unitary); or Canada (federal) and the United Kingdom (devolution within a unitary system); or Germany (federal with cooperative administration) and Japan (unitary with strong local administration). Research how each country organizes government below the national level.
Your project should address: (1) the constitutional or legal basis for subnational government in each country; (2) the types and levels of subnational governments that exist; (3) what functions subnational governments perform and how they are funded; (4) how much autonomy subnational governments have from the national government; (5) any recent trends in centralization or decentralization; and (6) one major policy area where you can compare how subnational governments in the two countries handle a similar problem—education, policing, environmental protection, or public health.
Conclude with an analysis: What are the advantages and disadvantages of each country's approach to subnational governance? What can each system learn from the other? Which approach better balances national unity with local self-determination, and why?
State, regional, and local government do not live at the margins of democratic life—they occupy its center. The decisions that most immediately shape how children are educated, how neighborhoods are developed, how police interact with communities, how water is kept safe, and how public spaces are maintained are overwhelmingly made by subnational governments: state legislatures, city councils, county commissions, school boards, tribal councils, and the thousands of special districts that manage specific public functions. National government sets important constitutional frameworks and protects fundamental rights, but the texture of daily civic life is woven at the local level.
This reality carries a democratic obligation. If local government is where so much governing happens, then local civic engagement is not optional for a healthy democracy—it is essential. The mechanisms of democratic accountability exist at the local level: elections, public hearings, open meeting requirements, budget transparency, and the relative accessibility of local officials compared to national leaders. But accountability requires engagement. A city council that governs without meaningful citizen participation is a local government in name only. The capacity for self-governance is always present in principle; it requires citizens willing to exercise it in practice.
The tensions between national authority and local autonomy, between uniformity and diversity, between rights protection and self-determination, are not problems that can be permanently resolved. They are permanent features of governing large, complex, and diverse societies. Every era of American political history has renegotiated these tensions—through constitutional amendments, court decisions, legislative frameworks, and political movements. Understanding tribal sovereignty alongside home rule alongside Dillon's Rule alongside the anti-commandeering doctrine is not an exercise in legal technicality; it is an exercise in understanding how the American system has tried—imperfectly and through ongoing conflict—to organize power across a continent-spanning democracy.
As the textbook continues into comparative government, public policy, and political systems, the themes introduced in this chapter will recur. The question of which level of government should exercise which authority over which kinds of problems is not only a technical question of governmental design. It is one of the fundamental questions of democratic politics. Understanding how the American system has structured those questions, and how other systems have answered them differently, is essential preparation for informed citizenship in a complex and contested democracy.
Chapter 15 examined the governments that operate below the national level—states, counties, municipalities, and tribal nations. Chapter 16 turns to a different category of governmental institution: the independent bodies that operate outside the ordinary elected branches but play essential roles in governing. Election commissions, central banks, audit offices, ethics boards, inspectors general, ombuds offices, and anti-corruption agencies exercise significant authority without being directly accountable to voters. Chapter 16 will explain why these institutions exist, how they are designed to maintain independence, and why that independence is both valuable and contested in democratic systems.