This would seem to be the preferred term in the Anglo-Saxon world, e.g. "In Canada, the constitution delegates responsibility for municipal institutions to the provinces. In British Columbia, municipalities are created under the provisions of the Local Government Act.' (http://is.gd/1lx4C)

miestna samosprava / local government is understood to be government at the obec level. See http://www.epi.sk/Miestna-samosprava/Default.aspx

another option