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During the last decade, bus rapid transit (BRT) has revolutionized regional transportation planning in much of the developing and developed world. BRT went from being a fringe transportation option used in a handful of Brazilian and Australian cities to becoming a prominent mass transportation alternative for local and national governments.
Arguably the BRT concept with highest recognition is the provision of an exclusive right-of-way for bus transit coupled with high-frequency service. In South America, BRT systems in Curitiba, Brazil, and Bogotá, Colombia, feature networks of dedicated lanes designated for exclusive use by large-capacity, articulated buses, with expedited boarding and alighting.
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The Latin America region faces formidable challenges in education and training on urban land policy, planning, and taxation issues. For nearly 20 years the Lincoln Institute has been offering programs on these topics in 17 countries in continental South America, and several others in the Caribbean. These countries have different legal frameworks (some unitary and others federal), approximately 400 subnational governments (states, provinces, departments), about 15,000 municipalities representing a wide range of local conditions, and more than 100,000 public officials responsible for land-related policies and management.
As part of the Department of International Studies, the Program on Latin America and the Caribbean (LAC) identifies partners, convenes appropriate audiences, advises on strategy, promotes research, and develops materials for education and training on key topics related to land policy. These include mitigation of rampant informality, reinforcement of self-financing through land value increments resulting from local public investments recovery, improving the performance of the property tax, and impacts of public interventions.
To reach out to its diverse audience, the LAC Program has developed a wide range of in-person classroom courses, seminars, and conferences for practitioners, including legislative and executive policy officials and their senior technical staff, as well as scholars, university students, and citizens. Traditionally, most of these programs have been weeklong professional development courses, offered once a year to 30 to 50 international participants from multiple countries, or ad hoc international or national conferences designed for hundreds of participants. However, the diversity of the Latin America region precludes tailoring the in-person model for different jurisdictions, and limited resources often prevent public agencies and private institutions from being able to send their personnel to the large cities where the events normally occurred.
As the programs became better known and the number of public officials seeking to participate in them grew, the Institute had to reevaluate its strategic approach to its mandate to improve the quality of debate on land policy issues through educational programs. Thus, to complement continuing in-person programs for targeted audiences in specific cities and countries, in 2004 the LAC Program began to develop other educational formats and media to reach key policy makers and professionals in government and academic institutions who were interested in urban land policy issues but unable to participate in one-time events.
The still-evolving LAC distance education offerings (Educación a Distancia, EAD) encompass many alternative approaches, including self-paced online courses; moderated courses that incorporate multiple interactive media formats; and graduate-level courses in partnership with Latin American universities and other institutions. These courses use a variety of tools and materials, ranging from simple, downloadable written materials to multimedia platforms such as Moodle, Blackboard, and eTEACH.
Pedagogical Strategies
Beyond the technological solutions to disseminating educational materials, a pedagogical problem remained. The pedagogical strategy adopted by the LAC Program for distance education is represented by an inverted triangle (figure 1). Users can remain at the general level, taking self-paced courses to obtain cross-topical but somewhat basic knowledge, or they can go deeper in one topical area through moderated courses or specialized, graduate-level university programs.
Working closely with pedagogical experts and guided by the Lincoln Institute mandate, the LAC staff and adjunct faculty gradually developed an EAD model based on the principles of constructivism, a psychological theory of knowledge developed by Swiss developmental psychologist Jean Piaget, which argues that humans generate knowledge and meaning from their experiences. Constructivism can be considered in contrast to positivism, in which scientific knowledge comes from positive affirmation of theories through strict scientific methods, such as quantitative research. Given the diversity and complexity of the subjects involved in land policy, the LAC Program has explored both approaches in creating its distance education courses. In this context, constructivism applies more often to knowledge associated with policy alternatives, while positivism is used in more technical courses based on the application of tools.
The LAC Program organizes courses within the constructivist framework, encouraging a broad discussion about the issues related to urban land policy without preconceived notions. The distance education courses on the Moodle platform allow for the creation of virtual communities and wide-ranging discussion environments, with participants from many Latin American countries contributing concerns and experiences that may be quite different from those of the faculty. The LAC Program also offers courses that are instrumental to the development of quantitative and (geo)statistical tools used in urban land policy, in this case applying the principles of positivism and learning-by-doing.
Over the years, we have developed two products with different features, applications, and goals: restricted-access courses (moderated, graduate-level, and in-person support courses); and unrestricted, free-access, self-paced courses. All of these online courses are offered in Spanish for practitioners from public and private institutions involved in urban issues, and some materials are now being translated to and from Portuguese.
Moderated and Self-Paced Courses
Moderated courses were our first choice to address the challenges of informing and preparing public officials to expand the scope of their policy alternatives, because they provide a strong educational foundation based on readings, discussion, and reflection. All of our moderated courses are free; however, applicants are selected through a competitive application process. Classes have about 45 participants each, normally including at least one representative from each of the region’s countries. The courses are developed over nine weeks, each with a designated professor responsible for teaching and/or orienting participants; the third, fifth, and ninth weeks are available for students to complete or make up specific tasks or quizzes.
These courses are set up on the Moodle platform, which offers excellent results in terms of performance and usability. Three main tools are used.
Completion of tasks and quizzes along with participation in discussions constitute the minimum criteria for participants to pass the course and receive a certificate from the Lincoln Institute of Land Policy.
The LAC Program offers nine distance education courses with overlapping themes (figure 2). One set of courses includes Financing Cities with Urban Land, which fosters a critical examination of the various policies regarding the financing of cities through urban land; and Property Tax and Urban Financing, which provides the analysis of the legal, political, and economic principles of land taxation as a beneficial instrument for urban development. This tax course overlaps with two others: Application of Multipurpose Cadastres in Defining Urban Land Policies, which covers topics related to land tenure, geotechnologies and urban land valuation systems used in different Latin American jurisdictions; and Urban Land Valuation Techniques, which presents the techniques and basic principles of commercial valuations and mass appraisal of urban properties.
A second set of courses includes Legal Dimensions of Land Policy, which offers an analysis of the main approaches and categories found in urban legal systems in Latin America, with the review of relevant theoretical and practical aspects for urban public managers. It intersects with Management of Urban Land Markets, which provides an examination of the structure, function, and regulation of markets and their relationship to the economic, social, and environmental problems of cities.
The technical connections between the two sets are provided by two additional courses: Urban Land Markets Analysis Techniques, which analyzes the basic principles of land and real estate economics and the application of empirical methods; and GIS Applications for Urban Studies, which covers basic concepts of GIS, alphanumeric databases structure, and cartographic tools useful in urban studies. Most of these topics and techniques are covered transversally in the course on Land Policy Definition in Small Cities, introduced in Spring 2010.
Over the years, we have experimented with different configurations of faculty and administrative staff. Since 2009 we have implemented a simple but efficient coordinating structure with senior Lincoln Institute staff responsible for the strategic decisions in terms of courses and production of materials, and a distinguished group of adjunct professors and their assistants who communicate directly with the participants and follow up on instructions about uploading materials, assignments, and quizzes. To keep up with increasing topical diversity and enrollment demand for EAD courses, in 2010 we increased the number of faculty from 22 to 52 and developed a special course for all teachers and assistants to ensure that they are all operating at the same pace and within the same framework on distance education pedagogy and Moodle tools.
Another response to the consistent increase in demand has been the development of self-paced courses as an alternative and complement to the more intensive moderated courses. Using different platforms and multimedia materials, self-paced courses rely heavily on videos taped during in-person classes and available for viewing on the Lincoln Institute’s Web site. These products are also being adapted for free downloading, especially for use by private and nongovernmental institutions, small cities, and educational institutions.
Course Materials
LAC distance education courses are supported by both written and audiovisual materials. The written materials, usually in a PDF format, are selected for individual student reading, analysis, and reflection. They include documents authored by the participating professors, papers available on the Internet for public access, and chapters of books and reports published by the Lincoln Institute and other sources. For certain courses, legislation and public documents from various countries are shared in order to facilitate comparative case studies.
Some course materials, primarily those authored by course faculty, have been compiled as e-books that can be downloaded in whole or in part to meet the needs of the course participants. The four e-books produced to date (in Spanish or Portuguese) are also available to other interested users.
A variety of audiovisual materials provide additional information and enhance comprehension through different production and user technologies, but with the common goal of accelerating understanding of the core curriculum. Early multimedia offerings were simple videos of professors teaching a class with alternating PowerPoint slides to create the atmosphere of an in-person lecture. The videos are produced with high-quality digital technology, and are used for both self-paced and moderated courses. Some videos are filmed in a studio and others are filmed live during a scheduled course.
The incorporation of audio classes has further enhanced the distance education experience. Professors in countries throughout the region tape their voices using free software and following the instructions of the course administrators. The audio files and related PowerPoint slides are sent to the editing team, which then creates an audio class. The sound portions of the multimedia classes (both video and audio) are converted to MP3 audio files.
The audio and video classes are being transcribed for two purposes: to give the hearing or visually impaired access to the classes, and to create the basic material for translation and dubbing or subtitling. Moreover, transcriptions are used by faculty to write the chapters of the e-books that are being produced in collaboration with many of the courses. These resources inform the participants in moderated courses, and are also available to the general public on the Lincoln Institute Web site.
Working in distance education requires constant updating of information as land policy issues and contexts change, and the educational arena itself is expanding rapidly with new tools, methods, and strategies. Currently we are considering the implementation of a learning environment in Second Life, a leading alternative in cost-effective virtual education solutions for collaborative learning. Second Life simulates an academic environment with classrooms, meeting areas, libraries, and other resources. Participants create a virtual image of themselves (an avatar) that can be moved among these facilities to access bibliographic materials, attend classes, and interact with the avatars of other participants. At present, we are designing a virtual learning environment and preparing faculty to work in it, using their avatars for navigation.
Linking Distance and In-Person Education
By experimenting with various combinations of distance learning and in-person instruction, the LAC Program staff has learned that the mix is a promising and productive model to pursue. For several years, we have developed tailor-made moderated courses as prerequisites for in-person weeklong courses in Latin America. We are now beginning to use existing self-paced courses as a preparatory stage for participants as well. This allows us to make better use of classroom time and minimize the need for sessions designed to equalize participants’ understanding of concepts, terminology, and fundamentals during the weeklong professional development courses.
As an alternative to the nine-week courses, we have also developed partnerships with several universities and nongovernmental institutions to implement graduate-level courses that combine classroom instruction with distance education content. These courses rely on the same basic distance education infrastructure, professors, and materials used for the moderated courses. Most of them, after being implemented initially with Lincoln Institute support, continue being offered by the partner institutions themselves. Some of these courses were developed in the Dominican Republic and Bolivia, where the LAC Program had not previously worked, thus establishing partnerships that have led to sustained relationships.
This combination model began with several initiatives that brought together select groups of alumni from previous online courses, and it has continued as part of two specialization courses—Urban Planning and Financing, and Urban Cadastres and Land Valuation—both of which conclude their distance learning segments with weeklong, in-person sessions. Our partner institutions plan to offer the courses on a regular basis with continued Lincoln Institute support in the form of class materials and the distance education platform structure.
Achievements and Remaining Challenges
A number of initial challenges have been overcome and can now be described as successful outcomes of the LAC Program’s distance education initiative.
Despite these advances and experiences acquired over time, some challenges remain.
Final Considerations
The results achieved by the Lincoln Institute’s LAC Program over the past six years demonstrate that the distance education platform is both functional and reliable, and that a combination of online course types enables us to reach more people and places without losing contact or missing the daily monitoring of participants. The success of the current pilot programs has special significance because it confirms that distance education is a valid option for the Latin America region due to increasing availability of Internet access and the openness to alternative learning methods.
About the Author
Diego Alfonso Erba is a fellow in the LAC Program at the Lincoln Institute of Land Policy and professor at Universidad Nacional de Rosario, Argentina. He is a land surveyor/engineer with doctoral and post-doctoral degrees in surveying sciences. He began working with distance education in Brazil in 2001 at Universidade do Vale do Rio dos Sinos (UNISINOS), and has spearheaded this program for the Lincoln Institute.
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The current state of global urban development is unsettling and plagued with man-made and natural disasters. In many developing countries, the government does not have the fiscal and institutional capacity to build affordable housing and basic infrastructure for the growing urban population, resulting in a proliferation of informal settlements and slums. At the same time, natural disasters in some of these distressed regions have destroyed homes, roads, water and sewage systems, and other public facilities, exacerbating the already limited basic services available to the urban poor.
In response to these problems, many international aid agencies such as UN-HABITAT and the World Bank, as well as governments, scholars, and practitioners, are looking for new ideas or repackaging existing ways to rebuild cities. This article discusses a long-established land management tool that has attracted recent attention—land readjustment (LR)—and describes how selected elements of this tool are being adopted to assist post-earthquake reconstruction efforts in Chile.
The LR approach emphasizes the integration of the urban economy, city planning, law, and governance with land management to form a comprehensive urban development or upgrading strategy. It requires an interdisciplinary team of experts with different perspectives to work on a concrete land development project. Although many scholars such as Doebele (1982) and Hong and Needham (2007) have emphasized the importance of this integrated approach, some practitioners perceive it as merely a tool to facilitate land transactions. This narrow view has limited opportunities in some developing countries to resolve urban upgrading and development problems in a more comprehensive way.
The recent resurgence of interest in LR is due to the recognition of the importance of coordinating economic, legal, political, and social institutions in the design and implementation of urban (re)development plans. Practitioners are also contemplating the possibility of extending LR from management of peri-urbanization and post-disaster reconstruction to slum upgrading, for example in some rapidly urbanizing African cities. The application of this LR approach to countries where the technique has never been used is still at an experimental stage. Potential pilot projects are being designed, but have not been fully implemented, so further research is needed to test the validity of assertions about this approach.
Challenges of Urbanization
In 2010, about 50.7 percent of the world’s population (3.5 billion people) lived in urban areas (World Bank 2011). The percentage is expected to increase to 70 percent by 2050, mostly in the periphery of secondary cities in developing countries. According to UN-HABITAT (2011), one-third of the urban population in developing countries (1.2 billion people) lives in slums and, despite substandard living conditions, these populations are increasing, especially in Sub-Saharan Africa and the Asia-Pacific region. Between 2000 and 2010, the number of slum dwellers increased by six million annually (Cities Alliance 2011).
Unfortunately, infrastructure and basic service development in most African countries have not increased at the same rate. Cities where sanitation, roads, water, and other services were already underdeveloped have limited fiscal resources and struggle with accommodating the unprecedented increase in population. Two major problems that hinder urban upgrading are holdouts in land assembly and lack of public funds to finance infrastructure—issues to which we will return.
Natural disasters also have taken a toll on urban populations. According to a United Nations estimate, earthquakes, tsunamis, landslides, floods, and volcano eruptions caused economic damage totaling $109 billion in 2010, three times more than in 2009 (Reuters 2011). Cities in developing countries with poor infrastructure and fiscal health are particularly vulnerable and are facing increasing price tags for both post-disaster reconstruction and adaptation to future calamities. Again, solving the problems associated with land assembly and infrastructure financing are crucial.
Conventional solutions for dealing with land assembly problems, such as compulsory purchase (eminent domain) and market transactions, are onerous. With increasing global demands for democratic governance and the realization of human rights to adequate housing, secure tenure, and protection from forced eviction, the traditional approach of relying on coercive measures that take land from owners or occupants for urban expansion and redevelopment is encountering strong legal opposition and public protests (table 1).
Using the market to facilitate voluntary land transfers is also problematic. Holdouts by individual landowners could thwart the redevelopment project and increase compensation costs for land acquisition. In some African countries where market mechanisms are not yet fully developed, unequal access to information has led to land grabs and speculation by local elites. As a result, the urban poor were either forced out or bought out from their neighborhoods and were relocated to remote areas where access to employment, public transportation, and basic services are limited.
To make matters worse, the fiscal outlook for cities in developing countries is bleak, and the opportunities to speed up the construction or repair of housing and basic infrastructure are limited. The 2008 subprime mortgage market meltdown in the United States has had adverse repercussions for municipal finances around the world. The decline in demand for imports in industrialized nations and the tightening of liquidity in the financial markets has slowed global economic growth. As exports to developed countries decrease, income-tax and value-added-tax collections in less developed nations also drop. The reduction in tax revenues exacerbates the already tight local budgets and further undermines the ability of municipalities to repair disaster-damaged infrastructure or build new facilities to accommodate rapid population growth.
Land Readjustment as an Alternative
LR has been practiced in many countries to achieve policy goals ranging from farmland consolidation to inner-city revitalization (Doebele 1982; Hong and Needham 2007). Its basic principle is to organize landowners to act collectively—in cooperation with a municipality and/or private developer—to pool their land in order to accomplish a redevelopment project.
LR is often used to re-parcel land when existing parcel boundaries are in conflict with the current land use plan. One important outcome is that a portion of the readjusted land can be retained by the development agency for construction of necessary infrastructure and basic services. If LR is not used, this land would have to be acquired by the local government, which could entail a huge upfront cost.
In return for the owners’ or occupants’ land contribution to the project, each participant receives, upon completion of the program, a new parcel proportionate in size or value to the original one. The size of the parcel may be smaller, but the value is greater due to land improvements and infrastructure created by the project. In this way, LR generates desirable urban development patterns, increases land values, allocates these increments to the involved parties, and limits displacement.
What is important about the recent interest in LR is its renewed emphasis as a mechanism for building legal and social institutions to govern urban development. The major goal is to combine job creation, land use planning, urban densification, public-private partnerships, and value capture for public infrastructure financing in one comprehensive policy package.
Potential Advantages and Disadvantages
Different elements of this unified goal can be emphasized depending on the context. For instance, in the design of a LR project for urban upgrading in an African city where residents do not have legal property rights, policy makers can legitimatize the occupants’ claims to land and allow them to exercise their right to participate in the project. After land is pooled, readjusted, and serviced, the residents will be invited back to the neighborhood to rebuild their homes or receive an apartment unit with legal title. This is a win-win approach because it allows squatters to improve their living conditions and tenure security, and it increases development densities to enable the city to obtain much-needed land for urban expansion.
LR can also help implement citywide land use regulation incrementally. To ensure that individual LR projects add up to a coherent whole, they must be conducted as part of a comprehensive urban planning process. In situations where local governments lack the capacity to execute a large-scale master plan, related LR projects can be implemented in an orderly sequence and at a manageable scale to put into action a coordinated, long-term development strategy.
In addition, LR can engender democratic governance. The core principle of LR is to build consensus and cooperation among the parties involved in land development. These parties include formal landowners, informal landholders, renters, NGOs, national government agencies, city officials, and private developers. The process entails grassroots mobilization by giving the urban poor real bargaining power to approve LR proposals. Agreement from the supermajority of landowners and renters is required before LR can proceed, thus ensuring that the government (or a private organizing agency) will pay special attention to the needs of the underprivileged groups and avoid confrontation caused by the threat of forced eviction at the very beginning of the project.
Finally, LR can facilitate land value capture for financing local infrastructure and social services. In readjusting the land boundaries, land space is created by increasing development densities. This land space can then be sold in the market to raise funds to defray a portion of the infrastructure costs. This technique creates a clear connection between the development benefits received by landholders and the price that they need to pay to make the program financially viable.
Despite these potential advantages of LR over conventional land assembly methods, it is hardly quick or uncomplicated. LR is particularly difficult to implement in developing countries where public participation is not integrated into urban planning or where there is limited capacity to maintain ownership records and resolve competing land claims. When property owners do not recognize their obligation to pay for basic infrastructure and services, requests to give up a portion of their land to cover the project costs will be strongly resisted.
Another concern is that LR reduces plot sizes, causing problems in many informal settlements where people often rely on extra space to earn rental income or conduct agricultural and business activities. In some cases, urban legislation is often too rigid for facilitating LR. Furthermore, different stakeholders may value real assets in diverse ways, making consensus building difficult. Some see possible improvements in living conditions, neighborhood amenities, social networks, and cohesiveness of community as the predominant factors. Others may make their decision based solely on monetary gains.
The integrated LR approach is designed to target all of these issues by focusing on institutional design and development. It emphasizes learning from past LR experiences to illustrate the importance of local context and enhancing this tool to accommodate a wide range of variables and situations. In addition, future adoption of the technique will search for a good fit rather than a single best practice. Most fundamentally, the design of LR projects must be based on multiple perspectives ranging from political economy and anthropological approaches to legal investigation.
Designing Land Readjustment in Chile
On February 27, 2010, a massive earthquake and tsunami destroyed a large part of Central Chile. Three regions—O’Higgins, Maule, and Bio-Bio—comprising 5 major cities and 45 small towns were seriously damaged; more than 80,000 homes were destroyed, and about 108,000 units were severely damaged (figure 1).
In response to this unprecedented disaster, the Chilean government expanded its National Reconstruction Plan to include new mandates and more flexible policies to speed up its post-earthquake reconstruction efforts. This plan offers four types of assistance in the form of vouchers to affected families: (1) US$24,144 for rebuilding a new home on existing land; (2) US$19,083 for buying a new home in another neighborhood; (3) US$3,761 for repairing houses that were partially destroyed; and (4) a special bonus of US$4,200 if the destroyed house is located in a heritage zone (Ministry of Housing and Urban Development 2011).
Despite this financial assistance from the government, affected property owners are facing two major problems. First, because the reconstruction program gives priority to low-income households, the money provided by the state to middle-income families is insufficient for them to rebuild homes of the same size and quality or in the same neighborhood. Property owners without insurance coverage who want to build a similar house must sell their land and move to another neighborhood where the land price is lower. Those who live in tsunami-damaged areas now considered unsafe for redevelopment must resettle further inland, yet that may limit their access to jobs and public services.
Second, selling their land to finance reconstruction may not be a viable option for all affected residents. Some landowners refuse to sell to private developers who offer a low price because the property is so badly damaged. Others who are unable to sell their land may not have sufficient financial resources to rebuild. This persistence of unlivable houses and vacant lots covered with debris further dampens the private incentive to reinvest in the neighborhood.
To assist the post-earthquake reconstruction effort, the Lincoln Institute of Land Policy and the ProUrbana Program in the Public Policy Center at the Catholic University of Chile (the team) put forward a joint proposal to the Chilean government to experiment with LR.
The Pilot Project: Las Heras, Talca
The team decided to conduct its first pilot in the Las Heras neighborhood in Talca for four reasons.
First, Las Heras was ripe for redevelopment even before the earthquake. It is a middle-class neighborhood with large old houses and a beautiful main square. Good social networks exist among its residents, organized by the church and local NGOs, although its development had stagnated for many years due to economic restructuring of the Chilean economy. The central government was offering Las Heras assistance in developing affordable housing through the national voucher program, and these housing subsidies later became an important potential funding source for the proposed LR project.
Second, the Public Policy Center has another program called Puentes (Bridges) that conducts collaborative research projects with local municipalities, including a preexisting work agreement with Talca, which facilitated prompt support and cooperation from city officials.
Third, Talca has a master plan that allowed the team to design a series of related LR projects to be implemented step-by-step, so it could fulfill the city’s long-term development plan. Preliminary land ownership and demographic information, land use data, and property damage assessments in different neighborhoods are also available.
Fourth, the local government and private developers in Talca were interested in increasing urban densities. Densification provided the much-needed profit incentive for the private sector to redevelop damaged sites, and it could help the local government achieve its objective of increasing and upgrading the housing supply.
Buy-In from All Involved Parties
Following the integrated LR approach, the team recognized the importance of gaining support from the central government. It organized a seminar in Santiago in May 2010 to present the concept of LR and exchange views with top officials from the Ministry of Housing and Urban Development (MHUD). After several rounds of follow-up discussions, the director of the National Program of Housing Reconstruction agreed to purchase reserved land generated from the proposed LR project, thus providing a guarantee for one of the funding sources, and agreed to go to Talca with the team to encourage property owners to participate.
To obtain critical local government involvement, the team travelled to Talca in September 2010 to present the LR ideas to city officials. The team also met with selected property landowners to determine if they might be interested in contributing all or part of their land as capital to finance the reconstruction of their homes and neighborhood. In another visit, some team members also met with school and community leaders, emphasizing the need for broad community support for the project’s success.
The team next began to gather detailed data about the area by conducting a survey of residents in eight blocks comprising 217 lots near the main plaza of Las Heras (figure 2). Team members completed 135 questionnaires over the telephone and then interviewed selected residents. The survey results indicated that 77 percent of the respondents trusted their neighbors, and the majority of them (65 percent) wanted to stay in the neighborhood and were willing to work with their neighbors to rebuild the community. Only 12 percent of respondents planned to sell their property and relocate to another area. This information revealed that organizing property owners for LR was feasible.
Project Design
Because the majority of residents in Las Heras are unfamiliar with the concept of LR, the strategy started with a small pilot project to demonstrate the applicability of this method. The team chose a block near the plaza and proposed three scenarios for combining 8 to 12 sites for LR. The number of lots included in the proposed project would depend on the levels of difficulty involved in negotiating with affected property owners. To facilitate the participation process, the team prepared visual images of what the neighborhood environment might look like after the project (figure 3).
The team also conducted detailed financial and legal feasibility studies for the project. A tentative plan for financing the pilot included a careful calculation of the amount of land that each owner would need to contribute based on the availability of government subsidies, estimated building costs, compensation for temporary relocation, and a projected land price at the completion date of the project. The financial study also revealed that constructing housing units at an estimated future price of US$46,000 per unit would allow the project to be self-financing and provide the developer with a 10 percent profit margin—under the assumption that MHUD would purchase the reserved land to build affordable housing for low- and low-to-middle-income households after LR. It was also estimated that 24 percent of the housing units within the block would be affordable for low-income households. This would help the MHUD attain its policy goal of social integration through the provision of subsidized housing.
The Real Estate Co-ownership Law in Chile requires all participating owners of the LR project to sign a legal document specifying their rights and liabilities. For example, any sale of land held by the designated organizing agency would require the consensus of all participating owners. A legal contract signed by the agency and each participating owner would specify explicitly the number of housing units that the owner would receive at the end of the project and the date of the delivery. The contract would also guarantee compliance by requiring the agency to pay compensation to owners in case of failure to transfer properties in a timely manner and of acceptable quality. The agency also needs to submit the proposed plan to the city. The Municipal Works Department would review the project, approve the building plan, and authorize the transfer of land. The approved plan would then be recorded by the registrar.
Although the research conducted by the team shows that LR is feasible in Las Heras, progress in convincing landowners to participate has been slow due to five key challenges.
First, most property owners are unfamiliar with LR, and there is no existing example in Chile to show how the idea could work. The lack of precedents makes community organizing difficult.
Second, city officials have not provided sufficient support in organizing community meetings or interacting with property owners directly about the proposed project.
Third, many affected property owners who received assistance from their extended families or friends have already relocated to other areas. These owners are in no hurry to rebuild their homes and are delaying the transfer of their land until they receive a higher offer from a private developer or the government. In Chile, there is no LR law that can force these owners to transfer their real assets.
Fourth, not all buildings in the neighborhood were destroyed by the earthquake, and the owners of the unaffected homes are not willing to give up their existing plots for a neighborhood-wide redevelopment.
Fifth, although the survey shows that many owners are willing to work on rebuilding with their neighbors, solving local problems through collective action is not a social norm in Chile. Some property owners have a strong sense of entitlement to receive public resettlement assistance, which contradicts the idea of community self-help.
Interim Assessment
Although the LR approach in Las Heras is still a work-in-progress and it is too soon to predict if the team will be able to overcome local challenges, the project has already generated several observable impacts on Chile’s post-earthquake reconstruction policy (Public Policy Center 2011).
First, LR gives property owners in Las Heras an additional option for reconstructing their homes. Before the proposal, they had to either sell their properties to a private developer and move to another area or take the government’s subsidies and rebuild a house of smaller size and lower quality. LR provides residents with the opportunity to remain in the neighborhood and to attain the highest possible living standard by using their land as capital for home reconstruction.
Second, LR opens a new channel for the central government to work with local communities on reconstruction projects. The main reasons that the LR proposal for Las Heras could go forward are MHUD’s willingness to buy land, provide assistance in encouraging landowners to participate in LR, and give participating landowners the first priority to receive government housing vouchers to finance reconstruction.
Third, the introduction of LR has influenced the government’s overall post-earthquake reconstruction strategy. Through this holistic approach, public officials are designing a comprehensive reconstruction plan to rebuild the entire neighborhood coherently, rather than giving subsidies to individual homeowners to rebuild their houses separately. The MHUD has also invited the team to assist its reconstruction effort in the earthquake-damaged city of Constitución, indicating that the government has taken LR seriously as a viable option for other projects.
Fourth, all discussions among the central and local governments, landowners, NGOs, developers, scholars, and urban designers about LR have engendered an environment of mutual learning and understanding, which in turn is reshaping the governance structure for post-earthquake reconstruction. The involved parties have begun to realize that neither a top-down nor a bottom-up approach is sufficient to generate satisfactory solutions. Cooperation among all interested parties is paramount. The LR experiment has fostered a social discourse that helps all segments of society learn how to solve their problems collectively.
Conclusion
Like all policy experiments, the current proposals to test the integrated LR approach for urban upgrading and post-disaster reconstruction in countries where the idea is new will face uncertainties and challenges. Yet, given the mixed outcomes of conventional land assembly methods in many (re)development situations, LR could offer another option for policy makers, practitioners, and other interested parties to consider.
About the Authors
Yu-Hung Hong is a senior fellow of the Lincoln Institute of Land Policy and a visiting assistant professor at Massachusetts Institute of Technology.
Isabel Brain, a sociologist, coordinates the ProUrbana Program (Program of Urban and Land Policy) at the Public Policy Center, Catholic University of Chile in Santiago.
References
Cities Alliance. 2011. World statistics day: A look at urbanisation. Washington, DC. http://www.citiesalliance.org/ca/node/2195
Doebele, William A. 1982. Land readjustment: A different approach to financing urbanization. Lexington, MA: Lexington Books.
Hong, Yu-Hung, and Barrie Needham. 2007. Analyzing land readjustment: Economics, law, and collective action. Cambridge, MA: Lincoln Institute of Land Policy.
Ministry of Housing and Urban Development, Government of Chile. 2011. Reconstruction Plan (English version). Santiago, Chile: Ministry of Housing and Urban Development.
Public Policy Center. 2011. Land readjustment project, second report. Santiago: Catholic University of Chile. May.
Reuters. 2011. Cost of natural disasters $109 billion in 2010. January 24. http://www.reuters.com/article/2011/01/24/us-disasters-un-idUSTRE70N26K2…
UN-HABITAT. 2011. State of the world’s cities 2010/2011–Cities for all: Bridging the urban divide. Nairobi, Kenya: United Nations Human Settlements Program.
World Bank. 2011. Data: Urban population. Washington, DC. http://data.worldbank.org/indicator/SP.URB.TOTL
Acknowledgments
The authors thank the other members of the LR project team for their contributions to this article: Armando Carbonell, Department of Planning and Urban Form, Lincoln Institute of Land Policy; Pia Mora, ProUrbana, Public Policy Center, Catholic University of Chile; Julio Poblete, DUPLA/Urban Design and Planning; Alejandra Rasse, Catholic University of Maule; Francisco Sabatini, Institute of Urban and Territorial Studies, Catholic University of Chile; and Martim Smolka, Program on Latin America and the Caribbean, Lincoln Institute of Land Policy.
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Es para mí un honor suceder a Gregory K. Ingram como quinto presidente del Lincoln Institute of Land Policy (ver página 28) y participar junto con ustedes en mi número inaugural de Land Lines. Será un gran desafío para mí poder estar a la altura de la capacidad de liderazgo de Greg y los años extraordinariamente productivos desde que él se hizo cargo del Instituto en 2005. Espero poder combinar mis habilidades y experiencia con las formidables herramientas y el talentoso personal del Instituto para continuar con nuestra misión singular: conectar a académicos, funcionarios públicos y líderes empresariales para combinar la teoría y la práctica de las políticas de suelo con el fin de abordar una gran variedad de desafíos sociales, económicos y medioambientales.
Hay fuerzas tectónicas —naturales, artificiales o ambas— que están dando nueva forma a nuestro planeta. A medida que confrontamos el cambio climático, la aceleración de la urbanización en Asia y África, el envejecimiento de las poblaciones de Europa y América del Norte, la suburbanización de la pobreza en los Estados Unidos y la insolvencia económica de las ciudades estadounidenses, las decisiones sobre el uso del suelo que tomemos hoy dictarán la calidad de vida de cientos de millones de personas en los próximos cien años. Hay una demanda crítica de planes y políticas integrales que regulen de manera equitativa el uso del suelo, sistemas políticos y sociales que garanticen la sostenibilidad, y análisis económicos sólidos con los que abordar estos desafíos, y esta demanda seguirá siendo alta durante las próximas décadas.
En este número de Land Lines, autores estrechamente relacionados con el Instituto Lincoln exploran estos temas. La fellow Lincoln/Loeb de 2013, Lynn Richards, próxima presidente del Congreso para el Nuevo Urbanismo, expone 10 pasos ingeniosos que las comunidades de los Estados Unidos han tomado para hacer sus suburbios más accesibles a los peatones, con viviendas económicas para compensar la suburbanización de la pobreza y emprendimientos más densos de uso mixto y transporte público para reducir el uso del automóvil y ayudar a retrasar el cambio climático. La arquitecta y fellow Lincoln/Loeb de 2014, Helen Lochhead, analiza los proyectos ganadores de Rebuild by Design (Reconstrucción por Diseño), el concurso internacional que promovió innovaciones de diseño para integrar resiliencia, sostenibilidad y habitabilidad en las regiones afectadas por la supertormenta Sandy. El Director de Relaciones Públicas Anthony Flint informa sobre el séptimo Foro periodístico anual del Instituto Lincoln sobre el suelo y el entorno edificado, que exploró opciones para realizar inversiones más inteligentes y equitativas en infraestructura en las ciudades del siglo XXI. Finalmente, en el Perfil académico, el analista de investigación senior del Instituto Lincoln, Adam Langley, comenta la base de datos de ciudades fiscalmente estandarizadas (FiSC) del Instituto, una nueva herramienta que servirá de base para nuevos análisis importantes que guiarán las respuestas locales a los desafíos fiscales de los Estados Unidos.
Y ahora un poco sobre mí. En los últimos 14 años trabajé en la Fundación Ford, donde ocupé un puesto singular en el sistema filantrópico global que me permitió apoyar, demostrar y ensayar nuevas maneras de resolver importantes problemas sociales. Algunos de los logros que más me enorgullecen son haber creado la Campaña Nacional de Propiedades Vacantes y Abandonadas, para ayudar a construir e incrementar la bolsa de viviendas de patrimonio compartido de la nación, por medio de colaboraciones con la Red Nacional de Fideicomisos de Suelo Comunitario y otras organizaciones asociadas. Ayudé a diseñar y posteriormente lideré Metropolitan Opportunity (Oportunidad Metropolitana), la próxima generación de programación comunitaria y de desarrollo económico de la Fundación, que se propone reducir el aislamiento espacial de las poblaciones necesitadas en regiones metropolitanas integrando la planificación del uso del suelo, el desarrollo de viviendas económicas y la inversión en infraestructura para ofrecer un mejor servicio a todos sus residentes.
Antes de trabajar en la Fundación Ford, había acumulado una gran experiencia en investigación sobre vivienda, economía y análisis de políticas públicas. Tuve la oportunidad de trabajar con académicos de todo el mundo en temas tan diversos como el nacimiento del movimiento medioambiental en Rusia, el papel de los desequilibrios de intercambio comercial y la deuda en los ciclos macroeconómicos y el impacto de la propiedad de la vivienda en las vidas de familias de bajos ingresos. He sido maestro y mentor de miles de estudiantes y he seguido sus logros con gran orgullo. Presenté investigaciones, abogué por cambios políticos y colaboré con éxito con investigadores, activistas y funcionarios públicos en cuatro continentes. Y ahora estoy entusiasmado y me siento honrado por unirme a ustedes en esta aventura con el Lincoln Institute of Land Policy.
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Inclusionary Housing: Creating and Maintaining Equitable Communities
By Rick Jacobus
From Seattle to San Francisco to Chicago to Portland, Maine, debates are raging over inclusionary housing—the requirement that developers reserve a percentage of new residential development as affordable. Some say the policy discourages development—or, in an argument that could reach the Supreme Court, that it threatens property rights. Meanwhile, New York City Mayor Bill de Blasio faces dual criticisms that his inclusionary housing proposal goes too far, or not far enough.
This new report by Rick Jacobus, Inclusionary Housing: Creating and Maintaining Equitable Communities, separates myth from fact, charting a path forward for policy makers and showing how inclusionary housing can be used effectively to reduce economic segregation.
“In hot-market cities, skyrocketing housing prices push middle-class and low-income residents far away from well-paying jobs, reliable transportation, good schools, and safe neighborhoods,” says Lincoln Institute President and CEO George W. McCarthy. “Inclusionary housing alone will not solve our housing crisis, but it is one of the few bulwarks we have against the effects of gentrification—and only if we preserve the units that we work so hard to create.”
Through a review of the literature and case studies, author Rick Jacobus of Street Level Urban Impact Advisors offers solutions for overcoming the major political, technical, legal, and practical barriers to successful inclusionary housing programs.
“More than 500 communities have used inclusionary housing policies to help maintain the vibrancy and diversity of neighborhoods in transition, and we’ve learned much along the way,” Jacobus says. “Research shows that if programs are thoughtfully designed and implemented, they can be a valuable tool at a time when affordable housing is desperately needed.”
In particular, the report addresses the concern that inclusionary housing can impede new construction by making development less profitable. According to the report, many cities have avoided such impacts by allowing flexibility in how developers comply and offering incentives, such as the ability to build at greater densities.
Other key findings and recommendations in the report include:
The Lincoln Institute has for many years developed strategies to support permanently affordable housing, including the establishment of community land trusts and other shared-equity arrangements. The effort is in recognition of the ongoing housing affordability crisis in many cities. Stratospheric rents and home prices in hot real estate markets are displacing longtime residents and changing the character of cities and neighborhoods.
To order, visit http://www.lincolninst.edu/pubs/3583_Inclusionary-Housing.
Rick Jacobus, a national expert in inclusionary housing and affordable home ownership, is the principal of Street Level Urban Impact Advisors (StreetLevelAdvisors.com). He was the founder of Cornerstone Partnership, and he currently serves as a strategic advisor to Cornerstone.
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In a report titled A Rise in Downtown Living, the Brookings Institution and the Fannie Mae Foundation (1998) highlighted an emerging land use movement in 24 U.S. cities. The release of the 2000 U.S. Census data verified the progress in those cities in another brief, Downtown Rebound (Sohmer and Lang 2001). While these publications alerted the nation to a possible trend, they did have some limitations, which inspired Eugenie Birch’s follow-up study, A Rise in Downtown Living: A Deeper Look, funded by Lincoln Institute, the University of Pennsylvania and the Fannie Mae Foundation.
This study, initiated in summer 1999, employs census data analysis, survey research, personal interviews and field visits to the sample cities. Birch draws on a larger and more representative sample of 45 cities, including 37 percent of the nation’s 100 most populous cities selected for balanced regional distribution, and of these 100 percent of the top 10 and 62 percent of the top 50. The sample includes 19 percent of the 243 cities having a population of 100,000 or more. Birch defined each city’s downtown by census tracts to create a baseline for mapping and collected data on nine population and housing factors for the downtowns and their cities and Metropolitan Statistical Areas (MSAs) over three decades. Birch administered two mail surveys, in 1999 and 2001, of city officials and business improvement district leaders to identify their respective roles in encouraging downtown housing, and she is currently making site visits to all 45 cities to verify the census data and survey results.
In this article, Birch summarizes seven key findings of her research, which were also presented at a Lincoln Institute lecture in March 2002 and reported in the APA Journal (Birch 2002).
The Definition of Downtown
Although most people think they understand what downtown is, there is no single socioeconomic meaning or geographical definition for the term. While U.S. downtowns share several common characteristics (a central business district at the core, access to substantial transportation networks, a supply of high-density buildings, expensive land), they differ dramatically in their age, size, functions, contents and character. Furthermore, downtowns are in a state of flux as their boundaries and contents are changing. Tracking downtown boundaries over time reveals that in almost all the cities in the sample, the downtowns of today are remarkably different in size (measured in the number of census tracts included) than they were 20 years ago. Downtowns that are incorporating residences are also attracting more community-serving facilities, such as supermarkets or cineplexes that used to be in neighborhoods. Maps of the several downtowns, created as part of this study, illustrate the size variations.
Residential Populations by the Numbers
The rates of increase in downtown residential populations vary enormously among cities. While downtown growth rates are impressive, numerical counts for MSAs still overshadow those of downtowns. Measuring the growth against basic benchmarks (1970 population levels for the defined downtowns and comparative growth rates with city and MSA) reveals just how fragile this movement is. For example, only 38 percent of the sample cities had more downtown residents in 2000 than in 1970. Only one-third had a downtown population growth rate between 1970 and 2000 that was greater than that of their cities. For the same period, 42 percent of the sample showed a negative downtown growth rate even when their cities had positive numbers. Finally, only seven cities (Chicago, Cleveland, Los Angeles, New York, Norfolk, San Francisco and Seattle) had downtown growth rates that exceeded those of their MSAs in the entire 30-year period.
Looking at the data decade-by-decade tells a different story. Not surprisingly, downtown population declined most severely in the 1970s, when 89 percent of the sample showed losses that ranged from 2.4 percent (Des Moines) to 60 percent (Orlando). In contrast, by the 1990s more than three-quarters (78 percent) of the sample posted increases. However, only four cities (Los Angeles, New York, San Diego and Seattle) had gains in all three decades. Comparing city and MSA data shows similar nuances.
Downtowns also vary in the amount and level of residential development. In 2000 for example, 24 percent of the sample cities had 20,000 or more downtown residents, while 20 percent had fewer than 5,000, and a great deal of diversity exists within the categories. Denver’s downtowners number just over 4,200, but most observers perceive the city’s record in attracting residents as a stand-out success, while Cincinnati, with about 3,200 downtown residents, is struggling to maintain a critical mass. At the other end of the scale, Chicago’s 73,000 and Philadelphia’s 78,000 downtowners are integrated into their larger metropolises.
Differences in the proportion of a city’s population that lives downtown are also striking. For example, Boston and Philadelphia have roughly equal downtown populations, but Boston’s comprises 14 percent of the total while Philadelphia’s is only 5 percent. Finally, a simple numerical listing of the sample downtowns is misleading. Downtown population growth has occurred at varying rates with some cities experiencing the phenomenon for a longer time than others. This may account for the greater success of some cities. Also, given the varying geographical size of the different downtowns, density measures as well as demographic analysis should be added to any assessment in order to gauge the potential impact (economic, political, social) of new residents.
Approaches to Creating Downtown Housing
Over the past decade, policy makers and investors have relied on six types of approaches to create downtown housing, and they often blend more than one of these:
To accomplish these ends, cities have engaged in creative financing, leveraging public funds, tax credits, gap financing pools and other tools at their disposal. Philadelphia, Boston and Lower Manhattan present examples of the office conversion trend, while Atlanta, Minneapolis, Cincinnati and Cleveland have employed warehouse store adaptive reuse. Charlotte represents a combination of HOPE VI, new construction and historic preservation. The found-land approach is seen in Milwaukee with its riverfront redevelopment (including brownfields remediation), Cincinnati with its expressway diversion/riverfront development, Des Moines with its construction of a new downtown neighborhood, and New York at Battery Park City. Chicago is the king of mixed-use new construction. Columbus (Georgia), Lexington and Chattanooga have fostered historic districting as a means to protect older, downtown residential neighborhoods.
Deep Roots of Success
Today’s growth in downtown living is the fruit of more than five decades of sustained attention to downtown revitalization. It has come about because cities have steadily improved their environments through downtown planning and additions of new elements to reinvent their old central business districts. In so doing, they have transformed their downtowns into new, hip places, thus making them competitive and attractive for housing. Although specific municipal policies such as favorable tax treatment, zoning amendments and infrastructure investments have, without doubt, flamed the private market activities in downtown housing, public investment in large-scale projects dating from the mid-1950s to the present have helped create a sympathetic climate for this investment. Preliminary evidence shows a strong relationship between investor choices and the presence of new downtown amenities. For example, developers in Los Angeles, Denver, Baltimore, Detroit and Memphis cite the presence of stadiums or sports arenas as important factors in their location decisions.
Demographic Characteristics of Downtowners
Downtowners are more affluent, more highly educated and more white than the city dwellers overall, but more diverse than those in the MSA. Singles, empty-nesters, gays, and childless or small households are more highly represented in downtowns than in MSAs. Families with children are present but not dominant. Other submarkets are students and the elderly. In some cities where the housing market is tight, notably Boston, New York, Chicago and San Francisco, low- and moderate-income groups are reporting difficulty in finding space for affordable housing. In other cities like Charlotte that have an excess of downtown land, much of it devoted to parking lots, the issue is not space but cost. In these contexts, questions arise as to what resources should be devoted to high-rent downtown units.
Private Development Efforts
Promoting downtown housing has emerged as a central strategy of private downtown groups, mainly business improvement district (BIDs), working with municipal government, often city planning and/or economic development departments. In 59 percent of the sample, BIDS or other privately sponsored organizations have engaged in pro-housing campaigns. As membership organizations their internal needs drive the agenda, so the amount and nature of their efforts vary widely.
Contribution to Citywide Growth
Downtown growth has contributed to the numeric changes in citywide populations in many cities. While the percentage contribution to overall municipal growth is often quite small, in 53 percent of the sample cities the downtown numerical contribution is a significant portion of the total, and in another 22 percent of the sample cities the downtown portion has offset losses in other parts of the city. In other words, without the downtown population growth, 60 percent of the sample would be worse off. In Boston, for example, downtowners constituted 25 percent of the increased number of people living in the city, while in Pittsburgh the additional downtowners reduced the city’s population loss by only one percentage point.
Conclusions
Reviewing these seven findings reveals a few themes. Downtowns are ever-changing places. Their functions, their boundaries and their very characters have been evolving in the postwar period. They are like complicated jigsaw puzzles with players (urban leaders) fitting the pieces together slowly. Just as assemblers first frame a puzzle and then fill in the center, city leaders have provided infrastructure outlines—streets or street improvements, schools, redeveloped river edges, improved open space—and now are adding other parts. Downtown living is one of these. In many places it has fit very well, especially in the past ten years. In a few cases, new downtown residents contribute significantly to the numerical growth of their city’s population. Just as certainly, many downtowns have not really kept up with their MSAs, and a majority of cities have yet to recover their 1970 populations. Nonetheless, having formerly vacant and/or abandoned buildings occupied (and eventually paying taxes) and having more (and more diverse) people on the streets night and day, weekday and weekend, are positive factors for urban life.
Making sense of this housing phenomenon requires not only placing it in the context of contemporary metropolitan development but also making it part of an evaluation of past urban redevelopment programs. Downtown living is not a silver bullet for curing urban ills but one element of an ongoing planning and investment effort for a part of the city.
Public/private partnerships have been essential in achieving changes in downtown living. The existence of productive interplay between focused interest groups, especially the growing number of business improvement district leaders, and public planning and economic development units has resulted in bold, imaginative, creative and thoughtful approaches to creating housing opportunities.
The findings and themes in this research give rise to other questions related to individual downtowns. These include an evaluation of the costs and benefits of attracting different types of downtowners and an assessment of the reasons why some places have been more successful than others in gaining the populations. This information that would be useful, for example, for policy makers in cities having less developed downtowns who first must decide whether a downtown living approach is appropriate for their cities and, second, must determine whether supportive incentives or complementary activities are needed. Other questions revolve around how to spread downtown progress to nearby neighborhoods without provoking displacement or unwanted gentrification and how to resolve the inevitable political disputes that will arise with the newcomers.
All in all, the rise in downtown living is as complex and layered as any urban issue. While widely reported in the popular press, it deserves a balanced, scholarly appraisal. This study raises important planning and development issues that still need attention: for example, information on the critical mass of residents required to make a difference in downtown life, the relationship between downtown housing units and employment, and the number of households needed to support community-serving functions. All of these issues lead to questions of balancing appropriate density for new development and quantity for adaptive reuse with other downtown functions like office, parking, retail and entertainment. No one really knows the proper composition of a balanced downtown.
Eugenie Ladner Birch is professor and chair of the Department of City and Regional Planning at the University of Pennsylvania.
References
Birch, Eugenie Ladner. 2002. Having a Longer View on Downtown Living. Journal of the American Planning Association 68 (1):5-21.
Brookings Institution Center on Urban and Metropolitan Policy and Fannie Mae Foundation. 1998. A Rise in Downtown Living. Washington, DC.
Sohmer, R.R., and Lang, R.E. 2001. Downtown Rebound (FMF Census Note 03, May). Washington, DC: Fannie Mae Foundation and Brookings Institution Center on Urban and Metropolitan Policy.
Few places in Latin America, or in the rest of the world, have dared to implement such radical urban land policy reforms as Chile has over the last 20 years. In 1979, the government began initiating deregulation policies by releasing a document that stated that the scarcity of land was artificially produced by excessive regulation, which resulted in the virtual elimination of urban growth boundaries.
Since then much has changed in the morphology and internal structure of Chilean cities, but the assessment of these changes varies greatly according to one’s ideological position. Explicit socially oriented urban policies have allowed for significant improvements in access to housing by the poor, but some argue that the spatial segregation impacts of such policies have imposed a high toll on society by indirectly lowering quality of life, impeding access to jobs and aggravating social alienation.
Even before the 1973-1990 period of military government, Chile was recognized as a unitarian and centralist political system, characterized by the strong presence of the state in economics and politics. It is a society with a relatively homogenous culture and is unique among Latin American countries in its strong legalist tradition. Chilean cities also present a sharp contrast to their counterparts in Latin America. There are virtually no informal land markets; land tenure has been almost completely regularized by strong public programs; and the majority of the urban poor live in areas where the main streets are paved and sanitary services are provided. Urban violence, in spite of growing trends, is still minimal compared to the rest of the continent.
Deregulation Policies and Problems
Among the most innovative aspects of Chilean urban policy are the following:
Although some of the achievements of these deregulation policies are widely recognized as positive-particularly in regard to legal and physical or urbanistic regularization and the quantity of social housing provided-many Chileans believe that the policies of the past 20 years have only caused new problems. Some of them are:
It is unclear whether these urban changes can be attributed directly to the effectiveness of market-oriented land policies or to the strong overall performance of the Chilean economy. The steady growth in gross domestic product (GDP), averaging about seven percent a year since 1985, was interrupted only recently due to the Asian economic crisis.
Expanding the Debate
The liberalization of urban land markets in Chile represents an intriguing and innovative experience from an international perspective, yet internal public debate has been limited. Recently, the achievements and problems of liberalization have reached a point of such undeniable importance that they have stimulated broad concerns. Furthermore, the government has proposed modifying the current “Ley General de Urbanismo y Construcciones” (Law of Urban Planning and Construction), which would result in a number of significant changes. Among the most important are:
To facilitate a focused discussion of these issues, Carlos Montes, President of the Chilean House of Representatives, invited the Lincoln Institute to participate in a seminar coordinated with the Institute of Urban Studies of the Catholic University of Chile. Titled “20 Years of Liberalization of Land Markets in Chile: Impacts on Social Housing Policy, Urban Growth and Land Prices,” the seminar was held in October 1999 in Santiago. It brought together members of the Chilean Congress, the business community (developers, financial leaders, etc.), officials of public agencies (ministries, municipalities, etc.), academics and representatives of NGOs to engage in a lively public debate. The discussion highlighted a clear ideological polarization between “liberal” and “progressive” approaches to understanding and solving deregulation issues (i.e., “more market” versus “more state”).
From a liberal point of view, these problems emerge and persist because land markets have never been sufficiently deregulated. Some liberals, in fact, insist that public intervention never disappeared; they believe that regulation actually increased after Chile’s return to democracy in 1990. For example, liberals cite various means, often indirect, by which the state restricts the free growth of cities, such as when it attempts to expand environmentally protected areas that are closed to urban uses or to impose an official and almost homogenous criterion of densification to all urban space. They also assert that citizens should be free to choose different lifestyles and that the authorities should limit themselves to informing citizens of the private and social costs of their options, with the implicit understanding that such costs are reflected in market prices when urban land markets are functioning efficiently (i.e., when they are fully liberalized).
The principal explanation offered by the liberals for the problems of equity and efficiency facing Chilean urban development today are insufficient advances in the application of criteria to “internalize the externalities,” particularly negative externalities, by those responsible for them. As passionately argued by some representatives of this group, private agents should be allowed to act freely, as long as they are willing to compensate society for the implied social costs incurred.
On the other hand, the progressives believe that liberalization has gone too far in its market approach and has left many problems unsolved: the increase in land prices; problems in the quality and durability of housing; the conditions under which land is serviced; social problems associated with urban poverty; and problems of efficiency and equity derived from the growth patterns of cities, such as the mismatch between areas where services are provided and the locations chosen for private developments.
These criticisms recognize the imperfect nature of urban markets and the need for greater levels of control and intervention. Among the forms of intervention recommended by many progressives are value capture instruments, which have rarely been used or even contemplated in financing programs for the public provision of new urban infrastructure and services. The creation of such mechanisms would be consistent with the idea of internalizing the externalities, a point of relative consensus between the progressives and the liberals. The main difference is that the liberals would restrict value capture to the public recovery of specific costs, whereas the progressives would consider the right to capture the full land value increment resulting from any public action, whether resulting from investment or regulation.
In more general terms, the progressives argue that not everything can be considered in strictly monetary terms. There are urban values and objectives related to public policy that cannot be achieved through the market, or for that matter by law, such as the sense of community. Although largely disregarded in the new housing options provided by private developers to low-income families, such as the voucher system, community solidarity is of tremendous importance to counteract the social problems that spatial segregation tends to exacerbate. Environmental conservation is another example of an urban policy objective for which “price tags” are seen to be of questionable effectiveness.
With regard to the free growth of cities and the idea of respecting the options of their citizens, the progressives react by noting that steep social and environmental costs tend to go hand-in-hand with sprawl. They also point out that the only group that can truly choose its way of life through the marketplace is the wealthy minority. While seeing benefits in concentration, progressives also voice concerns about extreme density. Some Chileans have expressed an interest in a metropolitan authority to deal with regional issues, and in the use of public infrastructure investment as a means of guiding growth.
Adequate responses to these issues and perspectives involve more than technical or fiscal solutions, such as the extent to which developers actually pay for the full cost of the changes they impose on society (let alone the problem of accurately assessing the costs) or the sustainability of the demand-driven voucher system which constitutes the core of Chile’s housing policy. The solutions also involve broader and more value-related concerns, such as the environmental costs of sprawl and the importance of maintaining local community identities and initiatives. Discussion in the Congress and other settings is still expanding, but is expected to take some time before the opposing perspectives reach consensus.
Martim O. Smolka is a senior fellow and the director of the Lincoln Institute’s Latin America and Caribbean Program. Francisco Sabatini is assistant professor of the Institute of Urban Studies at the Catholic University of Chile in Santiago. Laura Mullahy, research assistant, and Armando Carbonell, senior fellow, both of the Lincoln Institute, also contributed to this article.
Notes:
In contrast to the rest of the continent, drugs were not a major problem in Chile until recently.
2 Metropolitan Santiago is comprised of 35 independent political-administrative jurisdictions called comunas.
3 See Gareth A. Jones, “Comparative Policy Perspectives on Urban Land Market Reform,” Land Lines, November 1998.
4 Our use of the term “liberal” corresponds to its connotation in Chile, which refers to the strong influence of the economic principle of freeing market forces to their limits, as espoused by the “Chicago School.”
Sources: Francisco Sabatini, et.al., “Social Segregation in Santiago, Chile: Concepts, Methods and Urban Effects” (monograph, 1999) and Executive Secretariat of the Planning Commission for Investments in Transportation Infrastructure (SECTRA), “Survey of Origin and Destination of Trips in Santiago”(1991).
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Una versión más actualizada de este artículo está disponible como parte del capítulo 4 del libro Perspectivas urbanas; Temas críticos en políticas de suelo de América Latina.
Brasilia, la capital de Brasil, fue inaugurada a principios de los años 1960 como una “nueva ciudad” que daría comienzo a una era distinta para las metrópolis en América Latina y que demostraría cómo el gobierno hacía un uso eficaz de la tierra en aras de un crecimiento urbano planificado. Tal propósito se servía de dos instrumentos básicos: un control normativo del uso de la tierra basado en un plan general diseñado por Lucio Costa y el gobierno como propietario de las tierras de la capital federal, lo que permitiría que ésta fuera planificada sin los tipos de restricciones y conflictos que normalmente surgen cuando la tierra está en manos privadas. Sin embargo, tres décadas y media más tarde, los problemas asociados con el desarrollo urbano en Brasilia no se diferencian sustancialmente de los que padecen otras ciudades grandes de América Latina.
Falta de visión para la tenencia de la tierra y padrinazgo administrativo
Brasilia se presenta como un ejemplo único de la gestión de tierras urbanas en América Latina porque la responsabilidad de administrar las tierras públicas siempre ha recaído sobre el gobierno local. Sin embargo, la periferia de la ciudad ha sufrido un índice explosivo de crecimiento con un patrón concomitante de ocupación irregular de la tierra, subdivisiones ilegales y carencia de infraestructura. En Brasilia la posibilidad de dirigir el proceso de crecimiento urbano a través de una política explícita de acceso a las tierras públicas se ha visto comprometida de forma lenta e irremediable por la ocupación espontánea (e ilegal) de la tierra. Esta falta de visión en el uso de las tierras públicas suele ser disfuncional tanto para la densidad urbana como para las finanzas públicas, por lo que obstruye los esfuerzos que hace el gobierno local para proveer infraestructura a esos asentamientos irregulares.
Más aún, las influencias políticas que intervienen en el proceso de desarrollo han menoscabado en gran medida las posibilidades de manejar con eficacia la oferta de tierras públicas en Brasilia. A principios de los años 1990 el gobierno distribuyó unas 65.000 parcelas en áreas que carecían de infraestructura básica. Además de reducir las reservas de tierras públicas, este “padrinazgo de la tenencia de la tierra” generó la necesidad de encontrar otras fuentes para financiar nueva infraestructura. Dado que el principal recurso que tiene disponible la entidad de desarrollo urbano del Distrito Federal (Terracap) es la tierra misma, esta política de padrinazgo trajo como resultado la venta de otras tierras públicas para financiar la construcción de infraestructura en los asentamientos irregulares. Este círculo vicioso ha provocado graves distorsiones que la administración local actual pretende resolver usando tierras públicas como “capital” para crear una política efectiva que permita controlar los ingresos provenientes de la tenencia de la tierra y los costos urbanos.
La experiencia de Brasilia parece confirmar los argumentos de Henry George y otros de que la propiedad de tierras públicas no conduce por sí sola a un crecimiento urbano más equilibrado y equitativo socialmente. La estrategia del gobierno local actual de definir maneras de manejar el ingreso proveniente de tierras públicas para así controlar el uso de tierra urbana indica una nueva modalidad de interacción gubernamental con el mercado inmobiliario. En tal sentido, el gobierno cambia su función y deja de ser el propietario principal para convertirse en el administrador de los beneficios de la tierra.
Tierras públicas como capital de tenencia de la tierra
El principio medular de la nueva estrategia de Brasilia para administrar la equidad de la tierra es la definición de tierra pública como “capital de tenencia de la tierra”. El uso de esta tierra se somete a una serie de acciones estratégicas que transforman el capital de las tierras públicas en un factor que propicia la consolidación del complejo tecnológico del Distrito Federal. Se trata de la contraparte pública en el proceso de reconvertir el uso de la tierra en el centro de la ciudad en un instrumento de promoción social en el programa de regulación de la tenencia de la tierra: las tierras públicas se usan como activos mediante ventas, arrendamientos y asociaciones en proyectos urbanos.
La aplicación de estrategias diferenciadas para la tenencia de la tierra confiere mayor flexibilidad al gobierno para coordinar sus acciones. La búsqueda del equilibrio entre las iniciativas de índole social y otras en las que el gobierno intenta maximizar sus ingresos está cobrando la apariencia de una verdadera política de administración de tierras públicas que rompe con las anteriores prácticas de padrinazgo.
En este contexto de exploración de nuevos enfoques para el uso de tierras públicas con la finalidad de controlar el desarrollo urbano en Brasilia, el Instituto Lincoln, el Instituto de Planificación del Distrito Federal y Terracap organizaron un seminario internacional sobre gestión de ingresos provenientes de la tenencia de la tierra y costos urbanos en junio de 1998.
El programa reunió a expertos internacionales, ministros gubernamentales y administradores locales con miras a evaluar las experiencias internacionales en el uso de tierras públicas para financiar el crecimiento urbano en Europa, los Estados Unidos y América Latina. Martim Smolka del Instituto Lincoln describió las relaciones entre las operaciones del mercado inmobiliario, las regulaciones sobre el uso de la tierra y la recuperación pública de plusvalías. Alfredo Garay, arquitecto y exdirector de planificación de la ciudad de Buenos Aires, expuso las experiencias en el desarrollo de terrenos públicos en los alrededores del puerto de esa ciudad.
Bernard Frieden del Instituto de Tecnología de Massachusetts describió cómo se usan las actividades comerciales realizadas en tierras públicas en el oeste de los Estados Unidos para recaudar fondos para la educación y otros fines locales. Henk Verbrugge, director del organismo fiscal de Rotterdam y representante de Holanda ante la Asociación Internacional de Peritos, describió el sistema que tiene el país para la tenencia hereditaria, una regulación legal con la cual la tierra puede tener uso y beneficios completamente privados al tiempo que permanecen bajo control y propiedad económica de la municipalidad.
Los participantes discutieron la medida en que estas experiencias eran comparables a la situación en Brasilia y concluyeron que el éxito de varias estrategias para el uso de tierras públicas depende de la idoneidad de los proyectos específicos para la cultura empresarial del país en cuestión y las prácticas institucionales vigentes en la administración local.
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Most urban areas are experiencing significant disinvestment in older industrial-warehouse areas, along with a net loss of employment, tax base and related activity. The few recent surveys done to measure vacant industrial land suggest that, in Northeastern and Midwestern cities, 15 to 20 percent of industrial sites are inactive. In major cities such as Chicago or Philadelphia, vacant land can amount to several hundred parcels comprising several thousand acres. Often there are significant financial liabilities associated with the ownership of these “brownfield” sites due to the high incidence of contamination and related safety and environmental problems.
Vacant or underused properties are often located in areas suffering generally from physical decline, concentrations of low-income households and high crime rates. Thus, older cities are faced with the dual challenge of improving the capacity of the resident population to participate productively in the labor force and restoring the competitive market standing of areas with declining fiscal capacity.
While recent economic changes have resulted in a net decline in business activity in older industrial areas, many of these sites have the potential for residential, commercial or office reuse, with varying degrees of investment required. However, reuse is often constrained by factors including fragmentation in ownership, risks associated with the ownership or use of contaminated property, and the high market risks associated with front-end investment in environmental assessments, market studies, land assembly and area planning.
Currently, federal laws and regulations dealing with contaminated sites add to the high risk for new owners, investors and users who might otherwise contribute to reinvestment in and reuse of these areas. Also, federal and state clean up programs tend to operate independently of concerted area-wide redevelopment strategies and programs.
Special Situations for Industrial Reuse
Unfortunately, examples of successful reuse approaches which effectively orchestrate federal, state and local government policies and actions with private landowner, investor and business development actions are limited and tend to be concentrated in a few special situations. One circumstance involves a strong private owner such as a financially healthy major corporation which cannot avoid the liabilities associated with the site yet cannot afford the adverse publicity of simply abandoning it.
Another situation is when a strong private reuse market for the site creates a high reuse value relative to the current “as is” value. This typically involves waterfront or other property adjacent to growing downtowns or sites which happen to fit the development needs for a major, publicly subsidized facility such as a new stadium or convention center. In these situations, the private or public reuse benefit calls forth the financial and political resources necessary to acquire, clean up and redevelop the land.
However, most vacant or underused former industrial-warehouse properties do not meet these conditions. Generally the demand for reuse is weak or declining, in part due to deteriorating neighborhood conditions. Because of low land values, even for clean, ready-to-develop sites, finding investors for either equity or debt investment in acquisition, renovation or new development is problematic. These areas typically require more concerted efforts involving business, government and civic group participation.
Site-Specific vs Integrated Redevelopment
While interest in brownfields reuse has increased over the last several years, policy discussions at the national level and programs in the states tend to approach brownfields as a site-specific contamination cleanup problem rather than an area-wide reuse problem within the context of the metropolitan economy.
The case for integrating site treatment into a broader redevelopment strategy can be argued from several angles. One is simply that giving priority to cleanup expenditures may do little to foster area reuse and may preclude the more effective use of public funds. If the contamination is contained within a small area and the public can be protected from any potential harm, then area reuse may be more effectively fostered by focusing on the removal of other constraints to investment. These constraints may include improving access, removing unsightly buildings, installing landscape improvements, clearing sites of obsolete structures, and subdividing the area to better meet current facility demands.
Another argument for integrating site cleanup into an overall redevelopment strategy is that the cleanup costs are difficult to finance in a situation where the value of clean sites is very low. If an area-wide redevelopment effort focuses initially on increasing the overall demand to reuse sites, putting vacant clean sites into use will improve the demand/supply balance. Then, the cleanup costs can in most cases be funded out of the increased site value, and private owners of such sites will be motivated to clean up the sites voluntarily. Area-wide financing schemes using tax increment financing (TIF) and special taxing and benefit districts can also facilitate the funding required for remediation and indemnification against any future liabilities.
New Models and Strategies
The Lincoln Institute, in cooperation with the U.S. Department of Housing and Urban Development, is undertaking a research project to explore the problem of recycling urban industrial areas which fall outside of the special situations described above. The study builds on recent work conducted by the Lincoln Institute, the Northeast-Midwest Institute, the author and others who have researched reuse potential and demand/supply constraints in industrial areas. Some examples are the American Street industrial area in Philadelphia, the Collinwood area in Cleveland, the Southwest industrial area in Detroit, the south side of Chicago and several areas in Pittsburgh.
Research directed at discovering common opportunities and constraints and the related strategies most effective at addressing different types of situations is very limited. Therefore, our approach is to conduct a broad survey of industrial reuse markets based on a review of existing reports and interviews with local experts, and then to develop a series of in-depth case studies to assess alternative reuse strategies appropriate to common types of situations.
Each case study will include a survey and assessment of the city-wide situation and the conditions in various industrial subareas. Model solutions will focus on a single subarea chosen to represent a combination of factors, including the relevance of that case to other cities and the relative importance of the subarea to its city’s overall reuse plan. In each case, a group of development professionals familiar with the local real estate market will be involved in assessing opportunities and constraints, alternative strategies and implementation measures. Ultimately, our objective is to identify changes in federal, state and local techniques, policies and programs that would support the implementation of the strategies being developed.
J. Thomas Black, visiting fellow of the Lincoln Institute, is an urban development economist and the principal investigator for this project. The study is in its early stages and the author invites your insights, ideas and suggestions on the subject, particularly for case examples demonstrating opportunities, general strategies, particular techniques, financing methods or organizational structures that work well.
FYI
The Collinwood Yard in northeast Cleveland is a 48-acre, mainly vacant industrial site which has lost 20,000 jobs since 1970. Its access to Interstate 90 and the rail lines is a key element in the revitalization of the area.
The Union Seventy Center in St. Louis is a multi-tenant industrial/warehouse facility occupying a remodeled 2.7 million square foot General Motors assembly plant. It is part of a 171-acre redevelopment project which demonstrates the reuse and investment potential of older urban industrial areas.
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Despite the long-term and continuing trend away from central business districts and toward suburban development, a number of factors are motivating recent attention to rail transit. These factors include:
concerns about the negative impact of auto-oriented sprawl desires to reduce air pollution and energy consumption interest in rebuilding urban communities need to provide access and mobility to those without autos desires to save the costs and avoid the impacts of new or widened roadways
Many metropolitan areas in the United States are considering the addition or expansion of light rail and commuter rail systems to link employees with business centers. The land use characteristics of the corridors where transit lines operate have been shown to influence transit ridership, but much of the previous work is more than 20 years old and based on data from a limited number of regions.
Our national research project, conducted for the Transit Cooperative Research Program with Jeffrey Zupan, expands and updates earlier research. We analyzed information on 261 stations on 19 light rail lines in 11 cities, including Baltimore, Cleveland and St. Louis, and 550 stations on 47 commuter rail lines in the six city regions of Boston, Chicago, Los Angeles, San Francisco, Philadelphia and Washington, DC.
The study shows that light rail and commuter rail serve distinctly different markets and land use patterns. Light rail with its closely spaced stations attracts more riders per station when it is located in denser residential areas. Feeder bus service helps to boost ridership. Light rail can function in regions with a wide range of CBD sizes and employment densities. Commuter rail depends more on park-and-ride lots at stations in low-density, high-income suburban areas farther from the CBDs, which tend to be larger and more dense than those in light rail areas.
Light rail, with its more frequent service, averages about twice as many daily boarders per station as commuter rail, even though light rail is more often found in smaller metropolitan areas. Figure 1 shows that light rail is most effective in attracting passengers close to the CBD. Figure 2 shows that commuter rail attracts the largest number of its riders about 35 miles out from the CBD. In both figures, other factors affecting ridership, except CBD employment density, are held constant.
Because most transit systems emanate from and focus on a region’s CBD, the amount of employment concentrated downtown clearly affects the demand for transit. Figures 1 and 2 also show that ridership increases with CBD density for both light rail and commuter rail. For light rail, the effects of CBD density on ridership are most pronounced for stations within 10 miles of the core, while for commuter rail the larger impacts occur at stations 20 to 50 miles outside the city.
Changes in Employment and Residential Density
CBD employment density (as measured by employment per gross CBD acre) is nearly twice as important for commuter rail ridership as for light rail. Our study shows that a 10 percent increase in CBD employment density produces 7.1 percent more commuter rail riders, but only 4.0 percent more light rail riders. Commuter rail boardings are more strongly influenced by CBD employment density because these systems usually have a single downtown terminal. Higher-density CBDs assure that more jobs are within walking distance of the commuter rail station. Employment density in city centers is less important in light rail regions since they have more stations distributed throughout the CBD.
On the other hand, a 10 percent increase in station area residential density (as measured by number of persons per gross acre within two miles of a station) boosts light rail boardings by 5.9 percent and commuter rail boardings by only 2.5 percent. Throughout the study these effects are measured holding constant transit system characteristics such as parking availability, station distance to the CBD and station area income levels.
Light rail, with its relatively short lines, is most effective in attracting passengers when stations are in higher-density residential areas close to the CBD. Commuter rail ridership rises more slowly with residential density because commuter rail is a high-fare mode, and its higher-income riders tend to live in more expensive, lower-density places. Moreover, the higher speeds and longer distances on commuter rail tend to increase ridership to the CBD from precisely those places outside the city where residential densities tend to be low.
Cost-efficiency and Effectiveness
In this study, cost-efficiency is measured by annual operating costs plus depreciation per vehicle mile. Effectiveness is measured by daily passenger miles per line mile. For light rail, these measures indicate a strong positive relationship with CBD employment size and residential density. A weaker but still significant relationship occurs for CBD employment density and for the line distance from the CBD. This suggests that medium to large cities with higher density corridors work best for light rail. For commuter rail, larger, denser CBDs attract more riders per line mile, but add to the cost per vehicle mile, creating a trade-off between effectiveness and cost-efficiency.
The length of the rail line is important for both light rail and commuter rail. Longer light rail lines are both slightly more cost-efficient and effective, but ridership diminishes beyond 10 miles. Commuter rail lines are much more cost efficient when they are longer, but their effectiveness declines beyond 50 miles.
This summary does not address many other significant factors in rail transit usage and land use patterns, including operating, capital and environmental costs saved as a result of not using other modes of transportation, notably automobiles and buses. Cities considering investment in new or expanded rail systems need to examine carefully all transportation alternatives in a corridor, including site-specific conditions and local preferences. Further, our study makes clear the need to integrate transit planning with land use planning at the earliest possible stage.
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Judy S. Davis is an urban planner and Samuel Seskin is a senior professional associate with Parsons Brinckerhoff Quade and Douglas in Portland, Oregon. As a faculty associate of the Lincoln Institute, Seskin also develops and teaches courses linking land use and transportation. This article is derived from a report titled Commuter and Light Rail Transit Corridors: The Land Use Connection. It will be published by the Transit Cooperative Research Program in the summer of 1996 as part of Volume 1 of An Examination of the Relationship Between Transit and Urban Form, TCRP Project H-1.
