The public choice model in public administration assumes that rational individuals will act to achieve their diverse preferences most effectively through the fragmentation and overlapping of multiple jurisdictions which supply public goods in the market place of competition. Economies of scale are best realized through small service providers, with a variety of mechanisms available to aid communities to achieve collective goods. Mancur Olson, though, claims that in large groups, rational individuals will not contribute voluntarily to gain a collective good because their imperceptible contributions will not affect their receipt of the collective good. Urban fringe special districts were selected as the mechanism to examine the public choice model and to test Olson's large group model. The Houston SMSA contains nearly 400 urban fringe special districts; they are geographically small, and fit the small government criterion specified by the public choice model. These districts offer a variety of public goods, giving citizens choices over which goods to have governmentally supplied and which goods will be provided by private firms. They allow access to competing service providers and enable the citizen/consumer to "vote with his feet." Districts also meet the criterion of "individuals" as members of a large group (Harris County, Texas), who contribute incrementally to relevant externalities through their withdrawal of ground-water and management of sewerage and drainage systems for the small communities they serve. [...]