This thesis examines the historical development of principal-agent theory as it has been applied to municipal management, and how this theory helps us explain the high attrition rate in the city management profession. Current and past academic dialogue on the subject is discussed and various explanations for low city management tenure are explored. This research is based on data from a survey sent to 185 city managers in the state of Oklahoma, seeking answers from managers in the profession as to the cause of low city manager tenure. The findings suggest that principal-agent theory, as it has been applied to the manager-council local government plan, is insufficient to meet the needs of effective governing. A new organizational plan is proposed, based on adaptations of an organizational framework prevalent in the non-profit industry--Abstract, leaf 4.