From an urban design perspective, several differences and similarities exist between the municipalities. For instance, municipalities with 50,000 inhabitants or more are considered incorporated cities, while those with fewer than 50,000 are considered incorporated towns. An additional difference between the two is the amount of autonomy each municipality has, with cities provisioning their own services while towns typically depend on nearby cities for certain services. Regardless of this differentiation, all municipalities have a barrio called pueblo proper (English: 'town') which typically hosts that municipality's original Spanish settlement and is also typically that municipality's urban core. Municipalities with large populations, however, may have an urban core that consist of several barrios.
Other differences exist among the municipalities. Economic activity, for example, concentrates on the metropolitan areas surrounding the cities of San Juan, Ponce, Arecibo, Caguas, Mayaguez, Aguadilla, and Humacao, with most towns being commuter towns. Statistically, the municipality with the largest number of inhabitants is San Juan with around 400,000 while Culebra is the smallest with around 1,800. While in terms of territorial extension, Arecibo is the largest with around 125 mi2 and Cataño the smallest with around 4.8 mi2.
Because Puerto Rico was a Spanishcolony until 1898, its system of local government bears more resemblance to that of the Hispanophone nations of the Americas than to local government in the United States and some other Anglophone countries. Thus, there are no first-order administrative divisions akin to counties, as defined by the United States Government; instead, Puerto Rico has 78 municipalities or "municipios" as the secondary unit of administration. For U.S. Census purposes, the municipalities are considered "county-equivalents." The municipalities are grouped into eight electoral districts, but these do not possess administrative functions. In 1991, the Autonomous Municipalities Act was passed, which slightly modified the rights and responsibilities of Puerto Rican municipalities with the aim of decentralizing control and improving government services.
Every municipality is composed of several barrios, except for Florida which has only one barrio. The municipality of Ponce has the largest number of barrios, 31.
Every municipality (except San Juan) also has an urban area made up of one or more barrios. When the urban area is made up of only one barrio, it is called "Barrio Pueblo". Some urban areas are made up of multiple barrios: Ponce's urban area, for example, is made up of 12 barrios. All of San Juan's barrios are urban barrios, and the municipality of San Juan is composed of urban barrios only - thus, the entire municipality of San Juan consists of one large urban zone only.
Every municipality's urban zone is named by the same name as the municipality. For example, the municipality of Caguas has an urban zone called Caguas - just like the municipality. Some municipalities' urban zones are termed "pueblo" (town) while others are termed "ciudad" (city). The difference resides in the population of the municipality: if the municipality has an urban zone below 50,000 inhabitants, then its urban zone is called a pueblo. If a municipality has a population above 50,000 inhabitants in its urban zone, then its urban zone is called a ciudad.
36 of the 78 municipalities currently experience a budget deficit, putting 46% of the municipalities in financial stress. In total, the combined debt carried by the municipalities stands at about $590 million USD.[a]
In October 2009, a Puerto Rican legislator proposed a bill that would reduce the current 78 municipalities of Puerto Rico down to 20. The bill called for a referendum to take place on June 13, 2010, which would let the people decide on the matter. However, the bill never made into law.
It was not the first time that an attempt to consolidate municipalities had failed. In 1902 the Puerto Rico legislature, under pressure from the US.-appointed governor of Puerto Rico, passed a law consolidating the then-76 municipalities of Puerto Rico into 46. The law was repealed three years later.
With the serious fiscal crisis that emerged in the first half of 2010s, a new plan to consolidate municipalities was again circulated in the legislature in 2017 as a way to alleviate the government debt crisis, but even that plan was also ultimately defeated.
A legislator's 2009 proposal of Puerto Rico's future set of municipalities and their boundaries
^An Act: To amend Sections 1 and 2 of Act No. 100 of June 27, 1956 Act No. 81 of August 30, 1991: Autonomous Municipalities Act of the Commonwealth of Puerto Rico. In An Act: To amend Sections 1 and 2 of Act No. 100 of June 27, 1956, Act No. 66, 3rd Session of the 13th Legislature of Puerto Rico. April 14, 1998. Retrieved November 22, 2009.
^Ponce. Proyecto Salon Hogar. Map of Barrios of Ponce. (Map with fully urbanized barrios conglomerated and merged as "Zona Urbana". Barrio not labeled is named "Machuelo Abajo".) Retrieved November 30, 2009.