Urban upgrading

Evaluation covers the period 6/80-6/81 and is based on an analysis of project files and baseline data. Although construction has not begun, the project is basically on schedule in MSPS and 6 months behind in CMDC, contracts are nearing approval, and the housing guaranty (HG) was signed 9/81. In addition, feasibility studies and designs for the first five of 14 infrastructure projects in CMDC are well advanced. Construction of these and seven similar projects in MSPS will begin by late 1981. Progress has also been made in institutional development, primarily in organizing and staffing municipal project coordination units. No home improvement loans or land titles have been distributed, although CMDC is systematizing the land titling process. Problems in both cities included slow political transitions; severe budgetary constraints; costs for water and sewage system improvements 300% higher than expected (due to inflation, design variations, and high indirect costs); and inadequate community participation due to a lack of qualified staff. Project experience has taught that planners must give detailed consideration to inter-/intra-agency coordination in resource sharing and project management, and allow greater lead time to determine design and construction standards appropriate to low-income communities. It is recommended that A.I.D.: (1) formalize HG contracts; (2) accept the municipalities" indirect administrative expenses as part of their contribution to the project; (3) contract technical assistance to design and implement a community participation process; (4) locate financing for off-site water improvements at the first five upgrading sites in CMDC; (5) prepare recommendations on lowering construction standards and specifications to cut the costs of water and sewer systems; (6) conduct a baseline survey in MSPS; and (7) revise the affordability analysis of the project based on revised costs. It is also recommended that the MSPS mayor and the CMDC president assign more community development personnel.