To meet the needs of the people. If you look back at the last mid-term election where voter turnout was at an all-time low, it should be fairly obvious that people feel demoralized and useless when it comes to controlling our political system. Local government is the area of power in which citizens can find themselves exerting the greatest control and radically transforming the managed democracy that we've become into a real one which meets popular needs.
Should we have "more" local government? It depends what you mean. If you mean citizens need to exert more control over the local institutions that they have, then I think yes. If it means that we need an overwhelming amount of local government structures (which we already have), then I would think not.