The Collaborative International Dictionary of English v.0.48:

Municipalize \Mu*nic"i*pal*ize\, v. t. [Municipal + -ize.]
   To bring under municipal oversight or control; as, a
   municipalized industry.

         London people are now determined to centralize and to
         municipalize such services.              --The Century.
   [Webster 1913 Suppl.]