Lincoln residents will vote on May 13 if the small local service district will become a village or remain unincorporated.
The local service district, which is located near Fredericton, has been studying the possibility of becoming a village.
"This is an example of a locally led project, and one in which the people affected will have the last word," said Local Government Minister Bruce Fitch in a statement.
Residents can elect mayors and councils in villages and those councils have the power to make local decisions. Meanwhile, local service districts have advisory committees and the local government minister is responsible for decisions.
There has already been a feasibility study done on the idea of creating a village. The study’s summary will be mailed to Lincoln residents by the provincial government.
"It is important for residents to become informed and to participate in the process," Fitch said in the statement.
"The creation of a village will only go ahead if a majority of residents who participate in the plebiscite agree with the proposal," he said. "A positive vote would mean that the residents of Lincoln would be better able to work together for the benefit of their community."
The New Brunswick government is encouraging local service districts to merge with neighbouring communities.
Fitch has said the existing structure of 101 municipalities, four rural communities and 266 local services districts is no longer sustainable.
In 2011, there were 371 different governing bodies in the province, 83 per cent of them had a population of fewer than 2,000 people. There were more than 250,000 people without a local government, according to Fitch’s department.