Census Bureau statistics on governments are designed to account for the totality of public sector activity without omission or duplication. Governmental services in the United States are provided through a complex structure made up of numerous public bodies and agencies. In addition to the federal government and the 50 state governments, the Census Bureau recognizes five basic types of local governments (county, municipal, township, special district, and school district). 

Of these five types, three are general purpose governments: county, municipal, and township governments are readily recognized and generally present no serious problem of classification. However, legislative provisions are diverse for school district and special district governments. Numerous single-function and multiple-function districts, authorities, commissions, boards, and other entities, which have varying degrees of autonomy, exist in the U.S. The basic pattern of these entities varies widely from state to state. Moreover, various classes of local governments within a particular state also differ in their characteristics.

A government is an organized entity that, in addition to having governmental character, has sufficient discretion in the management of its own affairs to distinguish it as separate from the administrative structure of any other governmental unit.

To be counted as a government, any entity must possess all three of the attributes reflected in the above definition:

1. Existence as Organized Entity
2. Governmental Character
3. Substantial Autonomy

Evidence of this attribute is provided by the presence of some form of organization and the possession of some corporate powers, such as perpetual succession, the right to sue and be sued, have a name, make contracts, acquire and dispose of property.

Designation of a class of governments in law such as "municipal corporations," "public corporations," "bodies corporate and politic," indicates that such units are organized entities. On the other hand, some entities not so specifically stated by law to be corporations do have sufficient powers to be counted as governments.

The mere right to exist is not sufficient. Where a former government has ceased to operate – i.e., receives no revenue, conducts no activities, and has no officers at present – it is not counted as an active government.

This characteristic is indicated where officers of the entity are popularly elected or are appointed by public officials. A high degree of responsibility to the public, demonstrated by requirements for public reporting or for accessibility of records to public inspection, is also taken as critical evidence of governmental character.

Governmental character is attributed to any entities having power to levy property taxes, power to issue debt-paying interest exempt from federal taxation, or responsibility for performing a function commonly regarded as governmental in nature. However, a lack of these attributes or of evidence about them does not preclude a class of units from being recognized as having governmental character, if it meets the indicated requirements as to officers or public accountability. Thus, some special district governments that have no taxing powers and provide electric power or other public utility services also widely rendered privately are counted as local governments because of provisions as to their administration and public accountability.

This requirement is met where, subject to statutory limitations and any supervision of local governments by the state, an entity has considerable fiscal and administrative independence.

Fiscal independence generally derives from power of the entity to determine its budget without review and detailed modification by other local officials or governments, to determine taxes to be levied for its support, to fix and collect charges for its services, or to issue debt without review by another local government.

Administrative independence is closely related to the basis for selection of the governing body of the entity. Accordingly, a public agency is counted as an independent government if it has independent fiscal powers and in addition it has at least one of the following:

• a popularly elected governing body;
• a governing body representing two or more state or local governments; or
• functions that are essentially different from those of, and are not subject to specification by, its creating government, even if its governing body is appointed.

An entity must have both fiscal and administrative independence to be considered a government. Therefore, local government agencies having considerable fiscal autonomy may be classified as dependent agencies of another government, where one or more of the following characteristics is present:

1. Control of the agency by a board composed wholly or mainly of parent government officials.


2. Control by the agency over facilities that supplement, serve, or take the place of facilities ordinarily provided by the creating government.


3. Provision that agency properties and responsibilities revert to the creating government after agency debt has been repaid.


4. Requirement for approval of agency plans by the creating government.


5. Legislative or executive specification by the parent government as to the location and type of facilities the agency is to construct and maintain.


6. Dependence of an agency for all or a substantial part of its revenue on appropriations or allocations made at the discretion of another state, county, municipal, township, school district, or special district government.


7. Provision for the review and the detailed modification of agency budgets by another local government. However, county review of agency budgets in connection with statutory limitations on tax rates is not, by itself, sufficient to establish lack of fiscal autonomy.