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There is only one federal government in the United States, and there are only 50 state governments. However, there are over 3,000 counties and 20,000 municipal governments! Often, vendors selling to government will lump counties and cities into one general category of “local government”. While they do share many similarities, there are important differences. Understanding how each of these types of government functions is key to truly understanding your public sector clients. The goal of this report is to cover some basic facts about the common types of local governments in the US, explore functional differences, and relay this information into your business strategies.
Common City vs. County Differences
Where local governments derive their authority is important to understand how they function. In general, counties have a mandate from state constitutions - laying out specific formation and governing rules. This top-down mandate also means that counties carry out many state programs like Medicaid, drivers licenses, and SNAP. Municipal governments are formed from the bottom-up - people organize together to form their own governance systems. Counties have less discretionary funds to spend because significant portions of their funding comes from fulfilling state mandates and programs. On the other hand, cities have less mandates to fulfill, so they have more discretionary spending.