How does a city decide how fast you are allowed to travel on different roads?

Question

I am not talking about freeways, school zones, construction zones etc. I was wondering how the city decides that 35 mph is ok on one road or for a certain section, and then it can change to 45 mph on a different road or section.

Answer 1

Engineers will talk about the 85th precentile.  That is the speed 85% of traffic would flow at, should you not have any speed limit signs.  This only works in utopia.  

Speeds should be set as above, and places do try, but then you get local residents, politicians, and other sticking their noses in, and soon you have great hodge podge.  

Then you end up with roads posted much slower than they should be, because of NIMBYism, as locals don't want traffic on "their" street, so they get the local govt to drop the limit on it.  Next, you get places where they like to vary the speed limit up and down like a yoyo (Summersville WV leaps to mind) which is done strictly for "Revenue Enhancement."

Answer 2

the rule of thumb is this:

residential

commerical

mixed residential / commercial

open road (country)

two lane highways in rural U.S. with yellow line are all 55 mph period.  

is it an incorporated city or unincorporated county area

residence ... 25 mph

commercial  35 mph

rural city area 45 mph

freeway / parkway 65 or 70 mph in California

i hope this helps.