From Virginia's resolution of May 15, 1776 instructing the Virginia delegates in the Continental Congress to propose to that body to declare the colonies free and independent States:
Resolved, unanimously, That the Delegates appointed to represent this Colony in General Congress be instructed to propose to that respectable body to declare the United Colonies free and independent States, absolved from all allegiance to, or dependence upon, the Crown or Parliament of Great Britain; and that they give the assent of this Colony to such declaration, and to whatever measures may be thought proper and necessary by the Congress for forming foreign alliances, and a Confederation of the Colonies, at such time and in the manner as to them shall seem best: Provided, That the power of forming Government for, and the regulations of the internal concerns of each Colony, be left to the respective Colonial Legislatures.
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Notice the use of the plural "States" and notice the last statement. Seems pretty obvious that the States were to retain their sovereignty.