It depends on your municipality. In some they have local ballots where every candidate has to be approved. If they are denied because of racist (or similar) reasons, they can appeal the decision to a court. I believe the cow-bell-lady did that, but i dont remember the outcome.

Edit: did some research, she was granted citizenship recently. Here is an article about her (in english): https://www.swissinfo.ch/eng/society/swiss-passport_dutch-troublemaker-finally-granted-swiss-citizenship/43143162

Some context: This woman was trying to prohibit farmers from equipping their cows with bells, because she felt that they made too much noise. The population in this rural and traditional village did not like that, as they disliked people interfering with their traditions (especially since she was no swiss citizen). Some months later, she asked for naturalization, which was promptly denied by the popular vote in the village.