Quinta de Batle Cooperatives

1.- General identification

Location: Barrio Piedras Blancas, Montevideo, Uruguay.

2.- History, background and context

In 1968, a National Housing Law was approved in Uruguay combining different forms of social production of housing with political and budgetary planning, public and private promotion, employment stimulation, and user participation.

Between 1973 and 1984, a cruel military dictatorship was installed in the country. Among other setbacks, it detained the developing process of popular organization in relation to housing and dismembered the contents of the 1968 law. After democratic national institutions were recovered, the popular sectors — and FUCVAM in particular — demanded reinstatement of the political and budgetary conditions foreseen by the law, while at the same time proposing emergency measures to alleviate the high social housing deficit accumulated during thirteen years of official inaction in the field.

During the first democratic period (1985-1989, Partido Colorado), no substantial changes were produced in the housing situation. This forced FUCVAM to pursue struggle and protest strategies which ranged from the payment strike which froze repayments to the Mortgage Bank (1987), to the massive occupation of municipal lands (1989).
The political winds changed in 1990 when the national government was assumed by the Partido Nacional. The municipal government of Montevideo (where half the national population resides and the majority of economic activity is concentrated) was won by the leftist coalition Frente Amplio.

Within that new context, FUCVAM signed a Lands Agreement with the Montevideo government, and the National Congress approved Law 16.237, partially recreating previous housing access conditions for the popular sectors (budgetary previsions, plan of action, administrative procedures scheme, and creation of the Ministry of Housing, Territorial Planning and the Environment).

One of the most notorious consequences of the lack of public policies in social interest housing matters was the almost 40% increase in the housing deficit during the inter-census period corresponding to the military dictatorship. The dismantling of the legal and administrative apparatus also influenced in the growth of irregular settlements and extreme poverty conditions among the most disadvantaged urban sectors.

Once the novel Housing Ministry was established (1992), actions were focused on two differentiated strategies: the construction of so-called “Basic Evolutive Nuclei” (NBE, basic 32 m2 housing units), and attention to demands of the cooperatives which were the only organized sector (approximately 6,000 families at the time).

The NBEs are built through private construction firms invited to participate in public bidding, and the houses are allocated “key-in-hand” to those families requesting them and inscribed in the Ministry’s programs. The new residents begin to meet their neighbors when they move in to their newly assigned neighborhood, and the programs lack any social-community follow-up. The programs do not plan ahead for the expansions of the basic units, with this aspect left to each family’s possibilities.

The cooperatives were forced to struggle for years due to delays in the resolution of several administrative aspects. The urgent housing situation of many of the families organized in cooperatives was further aggravated by the sluggish pace of bureaucratic procedures necessary to secure a loan and build the homes.

Given this situation, FUCVAM decided to propose to the Housing Ministry that cooperatives be built through the “Emergency Programs” developed by the Ministry, which consisted of the construction of NBEs with quicker paperwork and lower costs than those usually faced by the cooperatives.

Following negotiations which dragged on through 1993 and into 1994, including a massive occupation of the Housing Ministry offices and several political mobilizations, an Agreement was established for the construction of 206 homes through a mutual aid cooperative system, within the framework of an emergency program of the Housing Ministry.

Brief presentation of the cooperatives:

  • Housing Cooperative Leandro Gómez, 105 families. The organization formed with the occupation of a private plot of land in the area known as Bella Italia in Montevideo, with the objectives to avoid eviction and procure a better quality of life.
  • Housing Cooperative de los Trabajadores, 50 families. This organization formed in the Barrio Reducto neighborhood of Montevideo by families who rented modest homes and in a few cases occupied unused and rundown buildings.
  • Housing Cooperative Horizontes Nuevos II, 40 families. This organization formed in a settlement located on the eastern border of Montevideo where families were occupying precarious housing along the Carrasco creek, with serious pollution problems.
  • Housing Cooperative Hogar 1, 11 families. This organization was constituted by a group of very poor families who had occupied the installations of an old abandoned textile factory.

3.- Objectives, strategies and scope

General objectives
Resolve the housing needs of 206 very low-income families living in emergency situations and in some cases facing environmental and sanitary risks.
Promote the organization and active participation of the beneficiaries.
Due to the emergency, establish lines of operative and rapid finance to facilitate efficient access to housing.
Urbanize part of a neighborhood lacking in services by incorporating non-resident population, increasing the population density and contributing the necessary facilities.

Strategic objectives

Demonstrate that the organized population can manage public resources more efficiently than the private companies.

Establish a community development process encouraging the social programs and collective endeavors — including elements beyond housing — through sustainable plans and awareness-building by the groups.

Achieve housing products which are superior in comfort and quality to those obtained through official NBE programs, while maintaining the same costs.

Establish a better stature for future negotiations with the authorities.

Participating population and beneficiary context:
The direct participants are the 206 families, but project impact would reach close to 2,000 very poor families precariously residing in the area for many years.
The area would be outfitted with sanitation services, street lighting, commercial and community services, collective transportation, improved traffic routes, and a sewer system.

Territorial scope:
Quinta de Batlle, sub-area of Piedras Blancas within the region of Centro Comunal Zonal N° 10 in Montevideo.

Innovative aspects:
An official emergency program, whose target population is individual families, was seized by organized groups and the resources directly administrated by the population involved.
This case illustrates the reaches of self-management and mutual aid, optimizing the scarce resources designated by the State to the lowest income sectors.

4.- Actors involved

The Housing Cooperatives (4) articulated the entire process, administrated the resources, proposed the urbanization programs, contributed the mutual-aid labor, and designed the community strategies and contextual approach.
The Technical Assistance Institutes (Centro Cooperativista Uruguayo CCU, in the case of Hogar 1 and Horizontes Nuevos II, and Cooperativa de Asistencia Técnica Vivienda y Medio Ambiente, COVIMA, for Leandro Gómez and de los Trabajadores) elaborated the construction project together with cooperative members; carried out the procedures required for technical approval in order to submit the loan request, and provided follow-up to the construction works and general advisory services throughout the construction process.
The Municipal Intendancy of Montevideo contributed the necessary land and urban infrastructure.
The Ministry of Housing, Territorial Planning and the Environment contributed the finance for the project.
The Mortgage Bank of Uruguay is the depository of financial resources allocated by the Ministry, releasing payments following verification of the physical progress of construction works.
FUCVAM linked the entire process and positioned itself together with the cooperatives as the primary negotiator with official entities. Contributed the necessary administrative and legal advisory during the group formation and consolidation process; provided training in management and political formation, and facilitated horizontal relations with other cooperatives.

5.- Program components

From the habitat perspective, the program foresaw the construction of four housing cooperative groups. For that purpose, lands were secured for the construction of 206 homes, three community centers (one is shared by two of the cooperatives and includes a basketball gymnasium and installations), an open sports field, a production area (alternating production of ceramic tiles and cement blocks), two children’s play areas, and two shops.
Sanitation, sewer system, streets and public lighting networks were all negotiated, as well as public telephone services and changes to the frequency and itinerary of the collective public transportation system.
The homes are of the “evolutive core” type, with a basic 60 m2 nucleus of initial area which can later be expanded.
The housing units are grouped in medium-density complexes, producing savings in the following aspects:
– urban facilities (reduced infrastructure and walkway measurements);
– land costs (simultaneously addressing rationality criteria in urban growth matters);
– investments to address ground shifting and housing foundation needs, and
– reduced exterior fencing, allowing use of better quality material.´´

The four cooperatives used traditional construction systems together with lightweight prefabricated elements made from cement and ceramic materials, which are suitable for mutual-aid type construction.
The projects present some variations in thermal-acoustic isolation solutions and other details, but the costs were the same in global terms.
From the social perspective, the groups participate in the entire housing production and management process. Cooperative members assumed the self-managed administration of resources, and relations with suppliers and contracted personnel. This direct administration results in correct selection of materials used, elimination of intermediary costs, and the possibility to carry out strategic planning in collective investments, which together produce greater commitment to the project by cooperative members.
The contracted personnel was recruited by the cooperative from workers qualified to carry out specialized tasks.
Cooperative members contributed the mutual-aid labor, constituted in principle by tasks which may be broken down into simple steps. As construction progressed, they assumed more complex or precise tasks. Development of the work is part of the planning for which cooperative members imposed on themselves a permanent performance evaluation system.
The role assumed by women should be highlighted. In the cases of Hogar I and de los Trabajadores, the majority of directive positions during the construction works were assumed by women. In the construction tasks, several areas were integrally assumed by female brigades, such as: ironwork and the fabrication of buttresses for cement structures, the threading of internal electrical installations, plastering, and bathroom and kitchen finishings.

6.- Description of the instruments

The cooperatives are permanent organizations. The property regimen is collective, and each member signs a contract with the cooperative for use and enjoyment of the housing.
The mutual aid regimen requires contribution by the cooperative of at least 20% of project costs through labor hours, translating into approximately 21 hours of work per week contributed by each family.
Cooperative members do not know which house will be theirs until the end of construction when homes are assigned through lottery.
Each cooperative receives a loan from the Housing Ministry which covers 80% of total project cost. In addition to financing housing construction, the loan must also cover land costs (which should not surpass 15% of total project costs).
In this case, the loan included a subsidy of around 19%, with the remainder to be paid over 25 years with a 2% annual interest rate.
The Technical Assistance Institutes are multidisciplinary teams regulated by law. In this case, they are cooperatives of technical service providers. The cost of these services is financed by the project, but can reach only up to 7% of total project cost.
The Housing Ministry resources come from the National Housing and Urbanization Fund which is constituted through the contribution of 2% of the salaries of the country’s economically active population.

7.- Achievements and main lessons learned

The 206 foreseen homes were built. The savings produced thanks to efficient administration by cooperative members made it possible for the housing units to be fully completed with finishings not included in the original budget (such as dividing walls on the second floor, cloths-washing facilities, backyard enclosures, kitchen installations, etc.)
Close to ten city blocks were urbanized, generating the necessary infrastructure for future insertion of 250 more families and benefiting 2,000 surrounding families.
A social network with strong negotiating capacity and a social references system were also constituted, making it possible for the cooperatives to assume leadership roles in the discussion and search for alternatives to problems such as urban security, collective facilities, and popular participation in the decentralization and development processes of the local government of Montevideo.
It was amply demonstrated that the capacity of the cooperatives, through the mutual-aid and self-management systems, can produce homes of notably better quality than those developed at the same costs by the official programs. Positive results are also evident in terms of the social assets generated in benefit of the entire community and the optimal use of resources.
Management of this process followed the following general schedule:
o 1992-94: The groups were constituted and legally established, and the processes began to secure the needed land.
o 1994-95: Procedures and negotiations were carried out to obtain the loan.
o 1995-97: Construction was implemented.
o 1998: The community process began and complementary works were carried out.

By the year 2001, in addition to the original 206 homes produced in Quinta de Batlle, 350 more had been built through the cooperative system with the same costs and characteristics.
In 1999, in the area urbanized by the cooperatives and within the framework of the same emergency program, construction began of approximately 25 NBEs (built by a private construction firm with a contract obtained by public bid, to be delivered key-in-hand). In other words, initiation of that project took two years longer than that of the cooperatives, despite the fact that the cooperatives had to negotiate and pressure the Housing Ministry to be included in the emergency program.
The Quinta de Batlle program, imperfect in many aspects but successful from the technical and political perspectives, was one of the first new housing construction programs with the participation of the Intendancy of Montevideo in the first period of the leftwing government. This aspect is mentioned in virtue of the articulating role carried out by FUCVAM between two governmental dependences with different political profiles.
Documentation of this process has served for FUCVAM to be able to systematically oppose the indiscriminate investment of public resources in the construction of NBEs.

Table of costs (1997)
Readjustable Units US dollars Incidence
Ministry and Intendancy LoanMinistry and Intendancy Subsidy 844 343 13,504 5,488
TOTAL INVESTMENT 1,187 18,992 80%
APPRAISED VALUE 1,484 23,744 100%

Final observations
The beneficiaries of NBE programs have a higher real subsidy than the cooperatives, despite the same investment amounts. An NBE beneficiary pays a monthly quota of 2 Readjustable Units (approximately US$ 24 as of 05/02) over a period of six years. The cooperatives, however, must pay an average quota of 3.5 Units (approximately US$ 43) over a period of 25 years.
The NBE program has opened opportunities for a variety of clientelistic maneuvers by public functionaries, and there have been enormous implementation problems with the private companies (higher costs, deficient-quality materials, etc.).
FUCVAM is developing intense mobilization so that the cooperatives appraised at the same values as the NBEs be subject to equal payment periods. There is agreement in principle on the part of the Housing Ministry, but the Inter-American Development Bank (which finances a large part of the infrastructure of these programs) is strongly opposed in virtue of the “collective” nature of the cooperatives, and in particular their tenure and ownership regimen. As of May 2002, the affected cooperatives were developing a strategy consisting of the payment of only 2 RU, combined with street mobilizations.
In July 2004, FUCVAM reached an agreement with the Housing Ministry so that the cooperatives be subject to the same subsidy as the NBEs, reducing the payment quota by 50% and the payment period from 25 to only five years. This agreement served to conclude the strong conflict maintained by FUCVAM with the public authorities, with clear benefit for the cooperatives.
In August 2004, construction was concluded on the 250 NBEs, elevating the population density of the region by approximately 1,200 additional residents. The cooperatives have completed all the infrastructure projects (sewer connections, pavement, lighting), which has enormously favored the insertion of the new residents (without requiring any resource investments on their part). The cooperatives have built small stores which have activated local commerce, and they negotiated improved collective transportation services for the area with direct connections to downtown Montevideo, the local center, and the region’s main avenues.
Finally, the cooperatives are proud to report that some of the children of the Leandro Gómez and de los Trabajadores cooperatives have organized a new cooperative (Mutual Aid Housing Cooperative Andresito), and they have already obtained their legal personality and secured access to a plot of land located approximately 20 minutes from Quinta de Batlle.

8.- Key words

Uruguay, Montevideo, Quinta de Batlle, housing cooperatives, self-management, mutual aid, better quality at equal cost, social participation, urbanization and community development.

9.- Sources

CCU “Dinámica Cooperativa” several numbers
CCU Descriptive reports
COVIMA Internal reports and documentation
Chavez Daniel and Rodríguez Hugo, 20xmiles (video, 1991)
FUCVAM “La Reforma Urbana” series (1990/1995)
MVOTMA “Plan Quinquenal de Vivienda 1990/95”
Vidal Javier “Programa Caminando: un viaje al interior de la FUCVAM” (1999)
Vidal Javier “Cooperativas de Vivienda, claves de interpretación” (2000)

10.- Contacts

E. V. Haedo 2219
CP11200 Montevideo
Tel: (598-2) 408 42 98/99
Fax: (598-2) 401 98 74

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