The formation of any district, annexation or incorporation within a county is governed by the Local Area Formation Commission (LAFCO). Although every county has one, their policies and practices differ greatly. Many counties encourage incorporations so the county does not have to provide the municipal services. Sacramento County is not one of them as they try to preserve the Uncity and the City of Sacramento tries to preserve land for future annexation, not a good scenario for potential new cities. These entities control the Sacramento County LAFCO Board with two members from the county, two members from the City of Sacramento and three members from special service districts.

The incorporation process is started by either a  current county special district such as the Recreation and Park District or the Water District adopting a resolution that they want to convert to a city or the process can be started through a petition signed by 25% of the registered voters of the community. With the resolution or the petition, an application is filed with LAFCO. LAFCO then assesses the environmental impact of the new city and the financial feasibility of the new city. Many counties in the state require only a negative declaration in lieu of the full environmental impact report (EIR) but Sacramento requires the full EIR, a much more costly process. State law requires only evaluating three years of the financial feasibility of the new city, but Sacramento has adopted the policy of evaluating ten years, again a more costly process. Up until May 2007, LAFCO would front approximately one half of these costs and the incorporation proponents would front the balance. If the incorporation was successful, LAFCO would recover their investment from the new city. If it was unsuccessful, LAFCO would absorb their costs. Because of budget constraints, LAFCO now requires the incorporation proponents to front the entire cost up front which it is estimated to be in the $300,000 range regardless of the size of your community. It is obvious that the direction of the Sacramento LAFCO is away from incorporations and toward selected annexations by the City of Sacramento and toward the preservation of the Uncity by the county.

Once the EIR and the financial feasibility are complete, the LAFCO staff makes a finding and takes its recommendation to the LAFCO Board. If approved, an election is called and the final decision on incorporation is with the residents of the Rio Linda Elverta community.