Local calling allows you to call another person within your local calling area. Local calls are normally included in the cost of your service, and not billed per-minute.
But what is local? VoIP phone calls travel across the Internet (and not copper wires the way old landline calls do), so there isn't a difference between a local (nearby) area code and a long distance area code. Unlike traditional landlines, you don't have to dial 1 to make a long distance call. When calling within the US and Canada, just dial the 10-digit phone number.