Sure, there's no threat of coercion for OP's street (or whatever) since nobody involved has any license to exercise power over the collective. But I thought the person you replied to was speaking of any group of people in general.

In the case of the 40 people, if a few of them consider whatever proposal stupid they can ignore it (e.g. not pay their share of something).

If they organize a republican government and have 4 representatives, some of the citizens could still refuse to pay (even if they accepted at first the election of the Street Senators). Coercion is what makes, say, Rhode Island, different than that person's street because if a few Rhode Islanders decide property taxes are stupid and refuse to pay, eventually all their land will be confiscated and they'll be dragged off of it by armed police.