Local government is the lowest level of government administration below federal and state governments. It began with the 1976 Local Government Act and covers designated areas within states. Local governments are categorized as city councils, municipal/town councils, or district councils based on population size, annual revenue, and whether the area is urban or rural. They are responsible for basic services like tax collection, land use planning, markets, recreation, housing, health, and development controls within their jurisdiction. City councils have the largest populations and budgets while district councils serve smaller, rural communities.