This is one term you can use. The "línea municipal" is the line that marks the boundary between municipal property (streets etc.) and private property (lots where houses and other buildings stand). The boundary between properties is called the property line, and the public property line is, similarly, the boundary between public and private property. Logically you could call it the municipal property line, but this term is rare; it is more common to refer to the public property line.

That is what "línea municipal" means here: this refers to buildings that encroach on public or municipal property by being built over or across the "línea municipal". Here is an article about the problem in Argentina:

"Buscan frenar la invasión de casas sobre "línea municipal"
En City Bell ya se realizan operativos para la "preservación del espacio público
Naturalizadas en algunos barrios platenses e inusuales en otros, evidentes o disimuladas, las invasiones del espacio público urbano que se dan cuando una construcción avanza más allá de la línea municipal están siempre presentes. [...]
"Quien se apropia de una vereda o calle está quitándole algo al conjunto de la comunidad" explica Gustavo Petró, titular del área de Planeamiento municipal"
http://www.eldia.com.ar/edis/20120604/buscan-frenar-invasion...

Examples of the English term:

"All freestanding signs shall comply with the following provisions: shall be placed behind the property line and no closer than 10 feet to any adjacent private property line; may project over the public property line, provided they conform to the standards established for projecting signs."
http://thechronicleonline.com/news/article_b12d912a-8f2a-11e...

"“Sidewalk” means that portion of a street between a curbline or the pavement of a roadway, and the adjacent private or
public property line, whichever the case may be, intended for the use of pedestrians, including any setback areas acquired by the city
for road widening purposes."
http://www1.honolulu.gov/council/ocs/roh/rohchapter9.pdf

"Some of the incursions are extensive. There are full lawns, stone walkways, flower beds, fire pits, birdbath and colorful displays of cactuses and succulents extending far beyond the public property line."
http://www.igin.com/article-2818-homeowners_ordered_t.html