A charter city is a city in which the governing system is defined by the city's own charter document rather than by state, provincial, regional or national laws. In locations where city charters are allowed by law, a city can adopt or modify its organizing charter by a majority vote of its resident citizens. A charter gives a city's residents the flexibility to choose any kind of government structure allowed by law.
For example, in California, cities which have not adopted a charter are organized by state law. Such a city is called a General Law City, which will be managed by a 5-member city council. A city organized under a charter may choose different systems, including the "strong mayor" or "city manager" forms of government.
A charter city may have some exemptions from some state or provincial laws, which varies entirely from region to region. As of June 2008, 112 of California's 478 cities are charter cities.
Paul Romer, economics professor at Stanford University, proposes founding many new charter cities on the coasts of developing countries. These cities would be run according to business-friendly rules and could create jobs for many millions of people. Romer argues that rich nations should guarantee the enforcement of rules in charter cities, while developing countries would provide the land. He elaborated the idea in an interview with D+C Development and Cooperation. Madagascar considered creating two charter cities, but the plan was scrapped when the political leadership that supported the idea was removed from power.