I like it in theory, but if you pay attention to the descriptions around Arkham, the place is under a constant state of siege by nightmare creatures. It is loosely based around Lovecraft/Cthulhu after all. I don't see how Tribunal could move in and protect the citizens without a complete rewrite of the city so it could actually be considered a "safe" place for the citizens.

That, plus it would also change the dynamics between the Trib/outlander war by putting them so close that it would essentially be both sides continually taking the laziest route to try to trap/bait/fight each other.