PROA urban development initiative : ESF local currency funded project

The evaluation covered the period FY88-12/91. PROA"s emphasis on involving beneficiaries in program design generated credibility among local people and many organizations. However, this approach to urban development is costly and time- consuming and, as a result, PROA has organized only 5 of El Alto"s 187 neighborhoods. PROA helped attract $38.4 million in investment to El Alto with only $1.25 million in A.I.D. funding, and played a major role in leveraging $16.3 million of this total. PROA maintained good relations with local government and other organizations despite a highly politicized environment. However, despite considerable efforts, PROA made little progress in strengthening El Alto"s local government, largely because of the weakness of the municipality. As a result, it now favors working with community organizations. PROA launched many projects in the areas of employment, housing, and health. Many of the projects, including microenterprise credit and community outreach health centers, benefit women and increase their role in local development. Overall, PROA"s projects range from low to high in their potential for sustainability. Those with a low potential for cost recovery should be terminated immediately. PROA lacks an organizational plan and strategies for financial sustainability. Currently, the organization recovers less than 10% of its costs. While it is expected that PROA can recover 53% of costs in 1993, it will have a budget deficit of $283,000 by that time. Thus, halting A.I.D. funding to PROA as of March 1992 (as planned) would lead to the drastic reduction or end of the organization. Several lessons were learned. (1) Organizations such as PROA offer the best formula for promoting municipal development and strengthening local democracy in Bolivia. (2) PROA must implement as well as catalyze projects to recover costs from beneficiaries and maintain a viable organization. (3) PROA should expand its emphasis on women"s role in local development. (4) Innovative urban and local development projects take time. Funders should maintain support for a minimum of 5 to 6 years. The organizations that operate these projects must establish and constantly refine their focus on goals to stay on track. Coalition-building around specific problems and nonpartisanship in politics are also important to success. An action decision is to extend PROA funding through 12/94 on an incremental basis.