The champs who give +1 to tech or arcane development do NOT need to be in any city, but for some like the +20% City Production bonus they do need to be in the city and then some I cannot tell if I am geeting a bonus or not in or out of the city so I just assume I am getting it both ways, though it could be bugged and I'm not.  This is the +1 Gildar champs.

I wish it was either better explained or indicated on a dashboard somewhere in game.  It is frustrating trying to optimize and the rules are not always rules but sometimes less than guidelines or just not implemented or just not effective.  Still I play the game it is addicting...