Chapter 2 describes the launching of the first nationwide local government elections amidst political contention in 1999 in Tehran, Khorasan, Fars, and Kurdistan and the institutionalization of elected local government within the parameters of the velayi regime. The chapter documents the rapid institutionalization of the new city councils throughout the country and in cities of different sizes. It reports on the impressive efforts of newly elected local representatives to carry out their new responsibilities within the limited legal powers afforded the new councils as well as depending on the social capital and trust of the local societies. Tehran City Council, for example, was initially marred by turmoil and dissolved by the central government, but stabilized over time. It has been an important bellwether of political trends elsewhere. The chapter documents the frustration of many councilors with what they perceived to be the narrow range of local powers defined by the local government law, patterns that would remain in place, part of the success of electoral authoritarianism in Iran.