The U.S. now has nearly 90,000 governments. Colorado will soon exceed 2,000. Within Jefferson County there are 140. The location of the Federal Center in the city of Lakewood imposes unreimbursed, costs of traffic control, snow removal, street sweeping, pothole patching, drainage, police and fire protection and so forth. Many more similar impacts accrue when a county government locates facilities in a small town.
Some governments provide more free services to other governments than they receive.
This inequity creates the incentive for feudalistic-like competition among them. They quickly and aggressively compete to secure new-found revenue sources and service rights. When the government provides a service, such as running an athletic club, and the government is exempt from taxation, then the government enjoys a huge hidden cost advantage over private competitors. Back in 1819, government entities did not compete directly with private business or with each other. But today, governments are without limits.