States are an optional system entirely. In Casters & Conquest a small group of players are powerful enough that they can have a military impact on the world. Over the course of the game, it is easy to envision situations in which players can overthrow governments and take over plots of land. This chapter includes a system to allow players to manage the land that they hold.

What A State Is
In casters and conquest the political map is divided into cultural regions which share no government, and within those cultural regions are tiny little states each with their own government and structure. Under this system, the land that the players control is divided up by the forts near it which govern it. A 'fort' and its statistics are abstractions of the wellbeing (or lack thereof)  of a piece of land.

The Founding Of A State
The first land that players come to possess is essentially given to them by the GM. They can overthrow a government, come into materials and labor to start a colony, or really anything, but there is no mechanism or system by which land is acquired. Just plot.
When players do acquire land on it, it comes with a fort. A fort is the seat of government in a particular area. It doesn't necessarily have to be a castle, and almost any government structure can fulfil the purpose of a fort.
When the players get their first fort they create a new government and a sovereign state, which needs a name, and heads of state and other officials. This is all decided by yourself and the game master.

Fort Stats & Amenities
Each fort has three stats: defensibility, morale, and economy, and an amenity. When the Game Master generates a fort they generally roll 1d6 for each of these, or pick numbers between one and six to represent them, and rolls 1d20 and picks the amenity of the fort off the amenity chart.
Defensibility represents how equipped the plot of land is to defend itself form invasion and insurrection.
Morale represents how happy people are with the government in the area.
Economy represents how much the region produces, and how well off its denizens are.
Amenities provide benefits to every fort in your nation by lowering your thresholds. For example, the amenity "grain fields" would result in -3 to your state's economy thresh hold.

How States Work
Each state has modifiers thresholds for stats, rights, and governing policies. Governing policies determine those thresholds, and the governing rights. We'll talk about governing policies and governing rights soon. The threshold is the number that a fort in its territory can go to without an key battle taking place. If a fort's stat is beneath that threshold, they go into a key battle at the end of the season. Each threshold is by default 1, and grows by 1 for each additional fort beyond the first in your state.
Seasons are the units of time for states. They can represent any amount of time, and generally the GM decides when the season progresses. In a season, a player may use one of their governing rights if they wish to, and must roll on the crisis table and try to respond to a crisis. Then before the round is over, they check to see if any forts have stats beneath the national threshold for that stat. If there are, a key battle takes place for control of that fort.
A key battle represents the player's military response to a violent insurrection/invasion. It could be representative of a single battle between the players and insurgents for the castle, or many battles fought by the military for multiple territories. If multiple forts drop beneath the threshold in one season, there is one key battle for all of them.
To create a key battle, the Game Master designs a combat of normal difficulty for the player's level, but this can be increased or decreased for plot reasons. Typically they fight in or near the fort against casters. The number of rounds it takes them to defeat their enemies is reduced by two and multiplied by two. This is called the battle's "military number". For each territory experiencing the drop, roll a d20. If you meet or fall short of the military number on your roll, the fort is lost. If you exceed the military number, you keep it.

Crises & Crisis Management
The modifiers that crises impose on your forts only last until the end of the season, and are generally parched as "-1-3 economy". This means that the event happens, and the players have to role play trying to help people deal with the fallout of that event, generally using their skills and talents. The GM then judges how well the players have solved the problem. A poor solution might result in -3 economy, whereas a good solution might only cause there to be -1 economy. Crises will naturally become more difficult to respond to as the player's territory grows, because more people live in them to provide those obstacles. At the start, players should be able to resolve crises well with amateur level skills. When a territory has grown to encompass 3 forts, veteran level. Six forts? Expert. Twelve forts? Master.