City Upon a Bill: The Politics of Municipal Incorporation

US history is peppered with instances of communities seeking political independence from government authorities. In the 19th century, a wave of utopianism swept across the country; the search for perfection through isolation gave rise to communities like the Transcendentalist Brook Farm in Massachusetts, the socialist New Harmony in Indiana, and the Perfectionist Oneida in New York. Following the Civil War, freed African-Americans founded all-black towns, including Nicodemus, Kansas and Mound Bayou, Mississippi, which Booker T. Washington lauded for its self-sufficiency. More recently, lesbian separatists found some success founding communes in the 80s, including Huntington Open Women’s Land in Vermont; Joyce Cheney documented these communities in her 1985 book Lesbian Land. The autonomy of cities has returned to prominence in the media lately, due to diverse controversies from sanctuary cities to alt-right calls for the formation of a white ethnostate to the Cal 3 ballot proposal in California. These budding issues have raised broader questions about the nature of federalism in the US. Despite the enduring relevance of contested jurisdiction boundaries, the actual prospects and logistical processes for officially forming new communities have received relatively scant attention. 

Municipal incorporation, the process by which a community gains official designation as a municipality, varies widely by state. Political scientists Rigos and Spindler write in 1991, “Some older areas like the New England and Middle Atlantic states are not likely to experience any new incorporations, while more recently urbanizing states in the South and West are now the locale of most incorporations.” Generally, a new city must meet requirements for population size and density, tax rates, and distance from pre-existing cities. These requirements differ between states, however, involving approval from different figures and sometimes including documentation such as a feasibility study or property assessment. In Kentucky, a petition for incorporation can be submitted if it’s signed by the owners of two-thirds of the area’s property value. The requirements are especially relaxed in Ohio: 51 percent of electors must sign a petition that lays out a map of the area, which must include at least two square miles, have at least 800 people per square mile, and contain property that generates at least $3,500 per capita in taxes.

Just because a community can incorporate, does that mean it should? The autonomy might be worth the paperwork. Because residents care and know more about conditions in their own backyards than authorities in a distant capital, locals are often best-positioned to craft policies that affect them. The importance of decentralized decision-making is especially clear with regards to subjects such as zoning, infrastructure, and public safety. The fear of being annexed by a neighboring city, the process by which a city adds a parcel of land to its boundaries, often provides the impetus to incorporate. State policies can facilitate incorporation through strong county governments and limited property taxes, among other methods. Despite the benefits of municipality status, it’s still possible to access some local authority without formally incorporating, as evidenced by the Woodlands, a suburb of Houston, which boasts over 100,000 despite the township status it retains; Houston has promised to not annex the Woodlands for 50 years and the Woodlands pays Houston directly for services. 

The incentive to form a municipality by incorporating a township comes down to four categories of activities devolved from state to local governments. The first category is structural, which refers to the discretion of the town to decide how it wants to organize its government and write its charter, and is also the category that typically involves the greatest local authority. The second category is fiscal, which covers financial activities from setting tax rates to borrowing funds. This category typically involves the least local authority. Third is personnel, which includes the ability to set rules concerning employment and collective bargaining. The final category is functional, which is the extent of the power granted to local governments.

" The autonomy might be worth the paperwork. Because residents care and know more about conditions in their own backyards than authorities in a distant capital, locals are often best-positioned to craft policies that affect them. "

The distribution of this functional power between states and their localities bears important implications for any group considering establishing their own municipality. While the Tenth Amendment devolves all non-enumerated powers to the states, the Constitution makes no explicit mention of cities or towns, meaning as far as the Federal government is concerned, municipalities are entirely subject to state authority. The default power-sharing agreement between states and municipalities is determined by the Dillon Rule, named after Iowa Supreme Court Justice John Dillon, who wrote in 1868:

“A municipal corporation possesses and can exercise the following powers and no others: First, those granted in express words (from the state); second, those necessarily implied or necessarily incident to the powers expressly granted; third, those absolutely essential to the declared objects and purposes of the corporation-not simply convenient, but indispensable; and fourth, any fair doubt as to the existence of a power is resolved by the courts against the corporation.”

The most significant shortcoming of the Dillon Rule is that localities must petition the state government for permission to pursue activities beyond its explicitly granted abilities. This red tape consumes a significant amount of state legislators’ political energy, which could be more effectively used to coordinate policy that affects the whole state. Beginning in 1875, states began to address this problem by passing ‘Home Rule’ legislation, which grants broad authority to localities to pass policies, given they’re not explicitly disallowed by the state’s constitution or statutes. However, no Home Rule states devolve full autonomy on every issue, so the applications of home rule differ by state. This authority is especially valuable to ambitious cities like State College, Pennsylvania, whose charter guarantees, “a right to a sustainable energy future, which includes, but is not limited to, the development, production, and use of energy from renewable fuel sources.” Home Rule would authorize Denton, Texas to ban fracking or Tempe, Arizona to ban plastic bags, proposals which have faced preemption, the process by which states nullify local laws. 

Proponents of the Dillon Rule argue that it helps states to standardize licensing and tax codes and establish a statewide business climate. However, this isn’t a clear advantage over Home Rule because even the 39 Dillon Rule states can devolve a substantial amount of local autonomy. Rather, a more holistic approach to measuring local autonomy would consider a range of metrics including constraints on local revenue and public employment. When a George Washington Institute of Public Policy study took such factors into account, it concluded that the five states with the greatest local autonomy are New York, Tennessee, Kansas, Ohio, and Louisiana. Of these, Tennessee, Kansas, and Louisiana follow Dillon’s Rule for some municipal jurisdictions, while Ohio uses Home Rule and New York is one of the 31 states that applies a combination of the two. For communities pursuing a radical political agenda, Ohio’s Home Rule should look especially appealing.
One better-known separatist proposal is the neo-Nazi Northwest Imperative, which would have white supremacists move to Washington, Idaho, Oregon, and Montana, among other Northwestern states. Washington was one of the earliest states to adopt a form of home rule, but it only applies the standard to cities of over 10,000. Idaho also adheres to home rule and the Dillon rule and requires only 125 electors in a village that attempts incorporation. Oregon applies home rule to all municipalities and enforces no minimum population requirement for incorporation, but does require a petition containing a feasible tax system. Montana also uses home rule but requires the permission of large agriculture and energy owners within the proposed municipality. The relatively low barriers to establishing towns in these states, coupled with the broad legislative authority afforded them, should inspire some gratitude for the regulations that do govern this process and the ultimate authority of the states to preempt abhorrent racist legislation that would arise under an incipient Northwest Imperative.

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