Section 1: Local Government System.

(1) The system of local government shall, under this Act, be by democratically elected Local Government Councils.
(2) There shall be 449 Local Government Areas in Nigeria as named in the second column of the First Schedule to this Act and each Local Government Area shall have its headquarters in the location specified in the third column of the said Schedule.
(3) The Local Government Area shall be the only unit in respect of which the Government of a State is empowered to establish an authority for the purpose of local government.
(4) Without prejudice to the provisions of subsection (3) of this section, the Government of a State may, by Law, create for any Local Government Area in its State up to a maximum of 7 Development Areas, having regard to such factors as common historical and traditional ties, geographical continuity and administrative expedience.
(5) Subject to subsection (2) of this section, the authorised by law to prescribe the area over which a Local Government may exercise authority shall define such area as clearly as practicable and in conformity with the provisions of the First Schedule to this Act.
(6) It shall be the duty of a Local Government within the State to participate in economic planning and development of the Local Government Area concerned and to this end, a joint economic planning board shall be established by a Law.
(7) The functions to be conferred by a Law upon a Local Government Council shall include those set out in Part V of this Act.
(8) Subject to the provisions of this Act-
(a) the National Assembly, as the case may be, shall make provisions for statutory allocation of public revenue to the Local Governments in the Federation; and
(b) the House of Assembly of a State, as the case may be, shall make provisions for statutory allocation of public revenue to the Local Governments within the State.
(9) The Auditor-General for the Local Governments of a State shall audit annually the accounts of the Local Governments and the report thereof shall be laid before the Governor or the House of Assembly of the State, as the case may be.
(10) Subject to the provisions of Parts I to VI of this Act, the House of Assembly of a State, as the case may be, shall enact a Law providing for the structure, composition, revenue, expenditure and other financial matters, staff, meeting and other relevant matters for the Local Governments in the State.