A lot of our city uses bitcoin already. We have bitcoin machines here too. The point would be a local economy mostly. Although nobody could really stop others from trading it or accepting it elsewhere, the goal would be using it here. MIT has a digital currency just for MIT students. Same deal except for a small city.
Where is this??
Personally I think this is a bad idea. You would be better off starting a community exchange system. This is different then crypto.
https://www.community-exchange.org/However if you are deadset on starting a local crypto then you should consider using nxt to create a new coin. research NXT MS
and if you could combine the community exchange with nxt MS then that would be pretty revolutionary.