"LAFCO is the "watchdog" the Legislature established to guard against the wasteful duplication of services."  City of Ceres v. City of Modesto, 5th District Court of Appeals, July 1969

The California Legislature delegates its authority under the  United States Constitution (10th Amendment) to regulate the formation and development of local governmental agencies to LAFCOs. Towards this end, LAFCOs are tasked by the Legislature to administer a section of State planning law now known as the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000. This legislation authorizes LAFCOs with regulatory and planning powers to coordinate the timely formation and development of local governmental agencies and their municipal services. Notable regulatory duties include approving or disapproving proposals involving (a) city incorporations or disincorporations, (b) special district formations, consolidations, and dissolutions,  (c) city and special district annexations and detachments, and (d) city and special district outside service extensions. LAFCOs inform their regulatory duties through a series of planning activities, which includes establishing and updating spheres of influence for all local governmental agencies. 

LAFCOs' central objectives and responsibilities as prescribed by the Legislature are enumerated under Government Code Section 56301 which states:

“Among the purposes of the commission are discouraging urban sprawl, preserving open-space and prime agricultural lands, efficiently providing governmental services, and encouraging the orderly formation and development of local agencies based upon local conditions and circumstances.  One of the objects of the commission is to make studies and to obtain and furnish information which will contribute to the logical and reasonable development of local agencies in each county and to shape the development of local agencies so as to advantageously provide for the present and future needs of each county and its communities.”

LAFCO decisions are legislative in nature and therefore are not subject to an outside appeal process. LAFCOs also have broad powers with respect to conditioning approvals so long as not establishing any terms that directly regulate land uses, densities, or sudivisions requirements.