Caño Martín Peña Community Land Trust
Main objectives of the project
- Promotor: World Habitat
Country/Region: Puerto Rico, Río Piedras [San Juan]
Aims and Objectives
- Legalise the relationship between more than 2,000 families and the land on which their homes stand.
- Guarantee affordable and safe housing.
- Resettle people who lived in high-risk areas in a fair and reasonable way.
- Improve environmental conditions by developing basic infrastructure and dredging the channel.
- Ensure ownership and management of the area by the community and for the community.
The Martín Peña Channel was once a waterway that ran through the middle of the Puerto Rican capital San Juan. Impoverished squatters settled on the mangrove swamps along its banks, building more than 5,000 informal homes. The water filled with debris and silt, and with no sewer system, it became highly polluted. With nowhere for water to flow, every time it rained the area flooded, creating a dangerous situation for residents. The government decided that something had to be done and a plan was put in place to dredge the channel and drain the land. Whilst there were obvious benefits to this plan, a potential consequence was that, with the environmental problems removed, the land (in a prime city location) would soar in value displacing the original residents.
Residents living in informal settlements around a polluted water channel and a government agency (the ENLACE Corporation) established a Fideicomiso – a Community Land Trust or CLT (a model of home ownership that develops and manages affordable housing on behalf of the community. It does this by separating the value of the land and the buildings. Land is held in perpetuity by the community enabling it to remain affordable for local people) was set up with. The government had experienced opposition and delays in previous infrastructure projects and was keen to ensure that residents’ interests were accommodated.
Between 2002 and 2004, the government consulted with communities over dredging the channel and improving the area. The communities were united in wanting to ensure that the works did not displace them. The consultation resulted in a comprehensive Development Plan and Land Use Plan which included dredging and drainage work, and also significantly the transfer of the land to the community. Initially the land was transferred to a government-owned arm’s length company: the ENLACE Corporation, with the intention that it should be transferred back to the community once a CLT had been established.
The process of setting up the CLT involved participatory workshops with the community. These workshops drew up the regulations that would govern the CLT. An Advisory Board and lawyers supported the process so that the ideas put forward by the community could be formalised legally. This period also saw the creation of the Group of Eight Communities (G8), whose role is to check that the Comprehensive Development Plan is followed by the CLT and the Corporation and facilitates communication between them. It is made up of elected representatives from 12 community organisations, increasing their collective power and voice. The Corporation led on land registration. In 2009, a Board of Trustees was formed, made up of residents, technical and professional advisors, a member of the corporation and representatives of the Government of Puerto Rico and the city of San Juan. The same year, the Corporation transferred 200 acres of land to the CLT.
Puerto Rico is a group of islands in the North Eastern Caribbean. It is an unincorporated territory of the United States of America. The World Bank classifies Puerto Rico as a high income economy but 41 per cent of its population fall below the poverty line. Economically Puerto Rico is poorer than the poorest state in the United States but wealthier than any other state in Latin America.
The eight communities living around the channel have an estimated population of between 15,000 and 18,000. The population is amongst the poorest in Puerto Rico, although the unemployment rate (22 per cent) is lower than the average for the territory. The 5,000+ houses were originally built on stilts out of light materials (cardboard, wood, scrap metal and palm leaves), but over time residents replaced these with cement and other sturdy materials. There is an informal supply of electricity which is unsafe. Most houses are in poor condition and the area is overcrowded (it is three times more densely populated than the rest of San Juan). The area is a high fire risk. Most houses are only accessible by narrow alleys which are inaccessible to fire engines.
- Avoiding Dispute: The CLT has provided a mechanism which allows the government and the communities to achieve their aims amicably.
- Relocation to appropriate and secure housing: Certain families have to be resettled in safer and more adequate housing. So far, this has affected 500 families, and will reach and affect a further 1,000 families over the next 10 years. The residents have the choice of where they would like to be resettled (within certain parameters), and can be housed within the CLT. At the moment there is not enough readily available housing in the district for all those needing resettlement. In response, the CLT is developing empty plots for new homes.
- Regularisation of land tenure: The CLT provides secure tenure for 2,000 families through rights to occupy land on defined areas. The right to occupy is formalised at the Land Registry. Regularisation can also involve obtaining building permits, resolving inheritance issues. Thirty notaries offer help for free to carry out this process.
- Guaranteeing long-term affordability and avoiding displacement: If the land was made available on the market, this could lead to rapidly increasing prices that would make the area unaffordable for current residents. The CLT structure avoids the involuntary displacement of the population. The residents collectively hold the title of the land in perpetuity.
- Ensuring participation of CLT members in decision taking: The members form an assembly that takes decisions on the CLT. In addition, both the regulations of the CLT and the Comprehensive Development Plan were developed through participatory activities.
- Ensuring financial sustainability: The CLT generates income by renting its properties, by developing vacant lots and by implementing projects as defined by the Comprehensive Development Plan. It grants government and non-profit providers of community services the chance to rent property in the District at a reduced and very low rate.
What impact has it had?
To date, the main impacts have been in terms of: increased access to security of tenure, a beginning of relocation to adequate sites, the start of new housing developments and increased organisation and empowerment of the communities:
- Around 1,500 families are now eligible for the right to occupy land in the District. Four hundred families have been trained on the procedure, 160 started the process of formalisation and 28 have completed it. The procedures to regularise the residents’ right to occupy have progressively been simplified and by 2016, the number of fully registered households should reach 1,000.
- The CLT is developing the first eco-friendly units as a pilot for a larger number of houses across the District. The predevelopment stage of 120 units in a multi-family complex designed in collaboration with residents is also ongoing (2015). These will be the first of the 450 units developed in the next five years.
- There are ongoing activities in education, workshops and events for members, which enable the sharing of experiences. Participatory budgeting is also being developed.
A wider effect of the CLT is the law that was passed to establish it. This set a precedent in Puerto Rico for CLTs and has had the impact of creating an effective model to respond to insecurity of tenure for the urban poor in the country.
How is it funded?
The CLT aims to be largely self-funding once fully operational. In the interim, it receives subsidies from the public and private sector for specific projects, such as the use of land registration procedure and the development of housing. For the financial year starting on 1 July 2015, US$200,000 have already been secured. The CLT currently receives US$140,000 per year through renting its properties but it aims to increase this to US$500,000 by the end of the current fiscal year.
Why is it innovative?
Using the CLT mechanism in the context of urban informal settlements is ground-breaking. The Caño Martín Peña CLT learned from international examples that used this model mostly for low-income residents, for example in North America and in Europe, and adapted it to local needs.
The model is innovative because it enables existing residents to remain and enjoy the improvements to the area. Investments in improved living conditions often increase land values and lead to gentrification. This prices out the original residents. The CLT avoids this by creating a system in which low-income residents can improve their living conditions without being priced out.
The process of resettling members within the CLT enabled the works on the channel to start more quickly with significantly reduced resettlement costs. It also allowed the families to have a choice over where they resettle. This was achieved by setting up a Resettlement Committee made up both of residents and employees of the Corporation.
The capacity to involve the wider community and mobilise significant support from numerous actors was crucial. Comprehensive development built on community participation, increasing collective knowledge and becoming active citizens contrast with the mainstream development of the city, where speculation and open market dynamics were the norm.
What is the environmental impact?
The works to the channel will improve 6,500 acres of the estuary, allowing water and tides to flow again. This will allow wildlife to return. Dredging the channel and new rainwater management will resolve local flooding problems. They will also help the whole city become more resilient to possible future rises in sea level.
In the future, the CLT is planning to extend its financial schemes to include micro-credit for energy efficiency.
The Environmental Squad was created so that children and young people would engage in the sampling of water for quality checks, or the development of community and school allotments.
Is it financially sustainable?
- The CLT aims to be largely self-funding once fully operational. The CLT and the Corporation receive funds from various sources, including donations, investments, income from rent of properties and development.
- The trust is quite reliant on volunteer work, which although cost effective, needs significant management and can be unstable in the long term.
- The CLT has a duty to develop and keep housing accessible for communities. It cannot resell the land and can only sell or rent out housing with the objective of benefitting its members. The trust reinvests profits into the communities through a revolving fund. This fund is for infrastructure improvements, buying property and other priorities of the Comprehensive Development Plan.
- As the area improves, the collective value of the land is expected to significantly increase. When a member household sells their house, any profits will go in part to the family, and part to CLT. This is because part of the increase of value comes from both the maintenance and upgrading of the house by the family and also from the work of the Corporation and the CLT in the area. Once a family sells their house, the CLT always has the option to be the first buyer and can guarantee an affordable price for the next occupant.
- The CLT supports families to make sure that they have a full understanding of how to manage their loans. This helps reduce the cases of mortgage defaults caused by the inability to pay back the loans. The CLT appears on the mortgage agreement and guarantees the option of buying out the property in the case of default. The CLT also hopes to help families raise their income. One of the ideas is to do this through certificados de participación (similar to US equity share) as an additional form of income for the members.
What is the social impact?
Participation in governance
Residents previously did not have any property title for the land on which their houses stood. For them, having the right to stay in the area they lived in for generations was their main priority.
The residents were trained on participatory processes, so that these methods and their objectives would be fully understood, and that people could identify and commit to them. In addition, music, cinema or theatre activities were added to participatory methodologies to engage citizens.
Discussions took place on which models of tenure would suit them best, including individual ownership, land cooperatives and CLTs. They were evaluated through a list of criteria, and residents decided that collective ownership through the CLT structure responded to their objectives.
Between 2002 and 2004, seven hundred participatory meetings were held to develop several documents, including:
- The Plan for Comprehensive Development and Land Use for the District (approved in 2007): a guide for the development of each of the communities of the District, as decided by its residents.
- The Law for the Development of the District (approved in 2004): created the Corporation, CLT and the G8 as entities that would respond to the priorities of the residents.
Between 2006 and 2008, the G8 and the Corporation organised three rounds of community workshops which took place on every two or three streets. These workshops helped to develop the General Regulations for the functioning of the CLT.
Cohesion and integration
Most of the activities of the CLT are carried out with and by the residents of the District. Resident members of the CLT are also in charge of explaining to those who also live on the land but are not part of the CLT what the advantages are of joining and help them in the registration procedure.
The communities worked closely with many other actors such as professionals, professors, students, the press and by being invited to share their experiences to different audiences including in academic circles or community groups, social marginalisation is reduced.
The residents managed to remain on prime land at the heart of San Juan, and organised to transform it into an attractive area. This will reduce inequalities in quality of life with other residents of San Juan. If the CLT had not been created, the rehabilitation of the channel would have led to speculative investment and displaced the population in favour of hotels, commercial buildings, etc. Instead, the residents have managed to create the law that enabled them to own and manage the area and remain there long term. This is a significant achievement since the area was under so much pressure for commercial redevelopment.
The CLT supports the development of leadership skills and critical thinking for adults, young people and children. Thirty programmes for social development were created to increase collective knowledge and skills across generations.
Health and Safety
For decades, the population lived in poor conditions and was exposed to health hazards associated with a polluted channel (flooding, poor water quality, solid and liquid waste, etc.). Their risk of having gastro-intestinal problems, asthma and dermatitis was significantly high, and many days in school or employment were lost to illness. Rehabilitating the channel will reduce such issues.
The social programmes also include initiatives against violence and the use of drugs. Children can become ‘Guardians of Prevention’ to support their peers in fighting against violence or addiction. Sport tournaments are paired with workshops on violence and gender inequality.
There was a significant setback in 2009. The Mayor of San Juan passed legislation that transferred the land back to the municipality of San Juan. The government approved a law which took the land from the CLT and made it public once again which made it available for sale.
The community, professionals, professors and students, media representatives, activists and many others joined forces to contest and revert this, and argued that the CLT was the best option both for the communities and for San Juan as a whole.
In August 2013, they succeeded and this law was revoked. The communities and the CLT were strengthened as a result as they managed to attract widespread visibility, engaging many actors who became committed supporters of the CLT.
When the CLT was given the land back in 2013, the members and supporters realised something had to be done so that this would not happen again. If the land was registered as a private entity with juridical independence, the following governments were less likely to change its ownership as they would have to pay compensation to the CLT.
The CLT is learning to adapt regularisation to a context where often documentation is missing and where cases have to be treated individually. Finding a good system to efficiently collect and update information from the field can reduce delays.
No evaluation has yet been carried out.
The CLT has no plans to scale up beyond current boundaries of the CLT, however, the membership of the CLT has been progressively increasing.
The CLT has been happy to share their experience with others facing similar issues. For example, the informal settlement Villas del Sol in another part of San Juan asked for their support in deciding how to avoid displacement (they eventually opted for collective ownership of land through a cooperative system).