Final answer:
Option (B), Dillon's Rule actually restricts local governments by only allowing them to exercise powers that are expressly granted by the state legislature, contrary to the false statement that it provides them with freedom and flexibility.
Step-by-step explanation:
The statement that Dillon's Rule gives local governments the freedom and flexibility to make decisions for themselves is false. Dillon's Rule is a legal principle that states local governments can only exercise powers expressly granted to them by the state legislature, or those powers that are necessarily or fairly implied in or incidental to the powers expressly granted, and those that are essential to the declared objects and purposes of the corporation.
This rule is named after Judge John F. Dillon, who formulated it in the 19th century. It actually restricts the powers of local governments, making them an extension of the state government rather than autonomous entities with inherent self-governing powers.