Am I the only one that takes issue with the whole "democratic municipal governments can't work" stance? Corporations shouldn't be run as democracies (with their employees as voters) because the goal of a company is to profit, not to make its employees happy. But cities should have a primary goal of furthering the wellbeing of its residents, and without democratic checks, the city government can create policies that serve only its own coffers.
Imagine you're running the corporation that governs the city. Your aim is to maximize profits. You do this by under-serving and over-taxing your residents, but not so much that they're pushed to move away. Because moving, buying property, and changing jobs or schools is time-consuming, expensive, and stressful, once you've got residents, the amount of tax-hikes or service cuts people are willing to tolerate before leaving your city might actually be quite high. This sounds like a terrible place to live.
As a profit maximizing CEO, I would have to mollify your concerns, otherwise no one would move to the city and I would make no profits.
When buying property in Hackertopia, the tax rate would be fixed at the time of purchase. The property valuation (and thus the total amount of taxes) could fluctuate of course. The valuation would be set by a variation of the old two people dividing the pie trick. One party (perhaps the homeowner) would set a valuation for the house. The other party (the city) would have the option of buying back the property at that price.
The property ownership contract would also guarantee that the provision of vital services (electricity, gas, water, etc) be provided at non-extortionate prices (perhaps the contract would specify that the price could be no greater than cost plus 30%). Thus city government would be contractually banned from charging $1k a month for water as back door property tax.
Since the city is making money off of property values, it has an incentive to provide common services such as roads and parks that increase property prices.
A company that screws over its customers or makes promises it then revokes will not be a highly profitable company for long. For a city to be profitable, and to maintain high property, it must continually attract new residents. If the city gains a reputation for screwing its residents, demand for property will plummet, property prices will drop, tax revenues will fall, and profits will fall.
The more the city government thinks about long term profits rather than short term profits the better life will be for the residents. Ideally, the corporate charter would have some tweaks to make the corporation even more future oriented than most corporations. For instance, all stock in the company could be restricted stock that is nontransferable until the owner has owned it for ten years. Executives would also receive dividend paying, non-transferable stock instead of stock options or a pension.
Imagine you're running the corporation that governs the city. Your aim is to maximize profits. You do this by under-serving and over-taxing your residents, but not so much that they're pushed to move away. Because moving, buying property, and changing jobs or schools is time-consuming, expensive, and stressful, once you've got residents, the amount of tax-hikes or service cuts people are willing to tolerate before leaving your city might actually be quite high. This sounds like a terrible place to live.