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In Animal Crossing City Folk, you cannot 'upgrade' your town. Your town stays pretty much the same throughout the game.

The Town Fund allows your city to compile enough money so the whole town can benefit from something. Here is the donation list:

Bridge is built: 200,000 Bells

Fountain is built: 400,000 Bells

Windmill or Lighthouse (your choice) is built: 1,000,000 Bells

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