This study analyzed the intention, specific measures, and implementation challenges of the Location Normalization Plan using a questionnaire survey results from 332 municipalities. The analysis showed that the induction of the urban function is not restricted to economic reasons alone, although a large segment of the municipalities showed some understanding of the principles and economic necessity of this plan. In addition, the majority of municipalities are adopting a cautious stance toward the intensification of urban facilities and residential mobility with legal force on the basis of political considerations. It seems that the perception gap between the national government and local municipalities currently remainins wide.