Model Colonia

Creative Solutions for Tough Problems

Report excerpt

By: U.S. Department of Housing and Urban Development

Date: 2004

Source: U.S. Department of Housing and Urban Development. "Model Colonia: Creative Solutions for Tough Problems." Delivering Results to Colonias and Farmworker Communities(February 2004).

About the Author: The U.S. Department of Housing and Urban Development (HUD) is the primary government agency responsible for ensuring equal access to housing and for improving the quality of affordable housing in the United States.

INTRODUCTION

The border between the United States and Mexico stretches through some of the most inhospitable land in North America, an arid semi-desert stretching from California to Texas. Scattered through this vast wasteland lie approximately 3,000 small settlements known as colonias. In Texas alone, more than 400,000 residents live in these impoverished villages, where housing is generally substandard. Inadequate or nonexistent sewage and water systems contribute to high rates of diseases more commonly seen in undeveloped nations. Unemployment rates in the colonias are as much as nine times the overall rate for the region.

Colonias first appeared in the border region in the 1950s, when developers bought otherwise worthless land and began creating small housing developments. Because these neighborhoods lay outside incorporated towns, few regulations governed their design and construction. Targeting poor buyers, the developers frequently packed the homes tightly together, skimping on basic amenities such as paving, water, and electricity. The poorly built homes would never have passed inspection in an incorporated area.

Given the poor quality of the homes, colonias appealed only to the poorest buyers; a recent study found that Texas counties along the Mexican border have average incomes less than half that of the rest of the state and that colonia residents in particular earn an average of just $5,000 per year. Colonia buyers were frequently enticed by a financing technique known as a contract for deed. Under this arrangement, the seller accepts a low down payment and low monthly payments but retains title to the property until it is fully paid off. Similar to a rent-to-own arrangement, these contracts often include high interest rates and provide the buyer little chance of ever taking ownership of the property.

Efforts to improve living conditions in the colonias have faced numerous obstacles. In a few colonias, water mains are in place but residents whose houses will not pass inspection are not allowed to connect before making extensive repairs and improvements. In many cases, residents are forced to purchase water in buckets or rely on uninspected wells. In addition, poverty, illiteracy, and language barriers make it difficult for many of the residents to navigate the complicated system of regulations involved in taking legal action against dishonest developers. For these reasons, modern colonias are often little more than disease-ridden rural ghettos with dirt roads running between cardboard and wood shacks.

Responding to the deplorable conditions in the colonias, the U.S. Department of Housing and Urban Development (HUD) in 1996 began studying the situation along the border. Among the goals of the HUD effort was improved coordination among the numerous state, federal, and local agencies attempting to alleviate the problem. The result was an initial effort to redevelop a single model colonia, in the hope that this project would serve as both a learning laboratory and a model for future efforts throughout the region.

PRIMARY SOURCE

The Model Colonia is representative of HUD's efforts to involve local residents and key partners in the process of making real change happen.

Dona Ana County, the largest of the eleven New Mexico border counties, has the highest number of colonias in the state of New Mexico. And of those 37 Dona Ana colonias, Vado/Del Cerro residents live in some of the poorest conditions. Vado began as a farming settlement in 1886, and Del Cerro was established as an extension by farmworkers thereafter. According to 1999 figures, 33 percent of the families in Vado/Del Cerro live below the poverty level. In addition, 77 percent of the population over 25 are not high school graduates, so families tend to survive on low-wage employment at nearby dairies or truck stops. But Vado/Del Cerro also has a very active and involved group of partners committed to community improvement.

To show what county, state, federal, and nonprofit partners can do together to improve the lives of colonia residents, HUD has funded a comprehensive, community-based planning process in Vado/Del Cerro.

HUD funding is leveraging other federal and private sector investors to demonstrate how a colonia can be transformed into an economically and socially viable community.

Anticipated outcomes of the Model Colonia are:

A comprehensive plan that paves the way for public and private investment, leading to substantial improvement in living conditions.

Elimination of unplanned, colonias-style growth. All new homes in the community will be required to meet basic housing and infrasructure standards.

Enhanced coordination among federal, state, and local agencies.

A model that can be replicated in other colonias or farmworker communities.

The Model Colonia reflects HUD's broadest goals. It will help ensure equal opportunity in housing, increase homeownership opportunities, and promote decent, affordable housing. It promotes the participation of faith-based and community organizations, and will strengthen communities by improving economic conditions.

Model Colonia Partners: Investing in Change

Many organizations are helping HUD transform Vado/Del Cerro:

Community Leaders

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Vado/Del Cerro residents have taken ownership of the project and are guiding priorities for action. Centro Fuerza y Unidad, a grassroots organization, has been the driving force behind progress in Del Cerro for over 10 years. It currently receives HUD technical assistance so it can obtain a nonprofit designation, which will open new opportunities for funding.

Dona Ana County Board of Commissioners

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The county has designated the Vado/Del Cerro Community as the initial model colonia for the U.S. Department of Housing and Urban Development Model Colonia Initiative and has prioritized infrastructure needs in the county's other 36 colonias. The county has also created a new Community Outreach Division within the Department of Health and Human Services and a special coordinator to work specifically on colonias.

New Mexico State Legislature

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Southern New Mexico legislators have pledged to assist with the Model Colonia. In the 2004 legislative session, legislators introduced multiple model colonia bills, and $285,000 was secured.

Vado Water Mutual Domestic Association

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This nonprofit organization has advocated for infrastructure improvements in the community of Vado since the 1960's.

Las Cruces-Dona Ana Housing Authority

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This public housing authority has committed to use proceeds from the sales of existing housing authority units to purchase land for an 18-unit affordable housing pilot using self-help/alternative materials. Model Colonia land has been purchased, and the development process has begun.

Gadsden Independent School District

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GISD will be locating a new elementary school in the Model Colonia. Construction is slated to begin soon, and the school will open in fall 2005.

Additional Partners such as Las Cruces Affordable Housing Inc. (a Community Housing Development Organization), New Mexico Mortgage Finance Authority, the Enterprise Foundation, U.S. Department of Agriculture Rural Development, and the Housing Assistance Council are contributing as well.

Colonia/Farmworker Initiatives…

HUD began its coordinated focus on the Southwest Border, colonias, and migrant/farmworker communities in 1996. In 2001, a Department-wide Southwest Border, Colonias, and Migrant/Farmworker Task Force developed a unified plan with specific actions assigned to HUD's different program offices. Implementation managers from these program offices have been turning the plan into action.

A small team is dedicated full-time to coordination of this effort. This Southwest Border, Colonias, and Migrant/Farmworker Initiatives (SWBR) work group— with staff assigned in HUD headquarters and field offices in states with colonias and high farmworker populations—is part of an office that reports directly to HUD's Deputy Secretary.

HUD has also begun developing partnerships with other federal agencies to address the complex needs along the border and among migrant farmworkers.

SIGNIFICANCE

The widespread poverty and public health problems in the colonias are symptomatic of a variety of underlying problems. By locating outside of established towns, unscrupulous developers are able to flourish with little or no oversight. The narrow, unpaved roads they build are difficult for school buses to navigate, reducing resident access to education, while the inadequate sewage systems they install lead to higher levels of disease. HUD's current project includes efforts to close the regulatory loopholes through which these developers are able to slide.

HUD is also focusing its efforts on coordination among local, state, and federal agencies. The GNMA (Ginnie Mae) Targeted Lending Initiative has provided $12 million to assist in the Model Colonia experiment, and faith-based and community improvement organizations are being encouraged to participate, adding their resources to the $46 million HUD has invested in the project. As a result, participating development groups can receive assistance with lot purchase and development, while qualified homeowners are eligible for down-payment assistance. Homeowners can also receive loan forgiveness on a portion of their mortgage, provided they meet payment obligations.

HUD and other involved organizations are optimistic that the Model Colonia experiment will provide the first practical solutions in addressing the persistent, pervasive poverty along the Texas-Mexico border.

FURTHER RESOURCES

Books

Riis, Jacob A. and Luc Sante. How the Other Half Lives: Studies among the Tenements of New York. New York: Penguin Group, 1997.

Sanchez Korrol, Virginia E. From Colonia to Community: The History of Puerto Ricans in New York City. Los Angeles: University of California Press, 1994.

Ward, Peter M. Colonias and Public Policy in Texas and Mexico: Urbanization by Stealth. Austin: University of Texas Press, 1999.

Periodicals

Myers, Dowell and Cathy Yang Liu. "The Emerging Dominance of Immigrants in the US Housing Market: 1970–2000." Urban Policy & Research 23 (2005): 347–365.

Saegert, Susan and Gary Evans. "Poverty, Housing Niches, and Health in the United States." Journal of Social Issues 59 (2003): 569–589.

Shroder, Mark. "Does Housing Assistance Perversely Affect Self-sufficiency? A Review Essay." Journal of Housing Economics 11 (2002): 381–417.

Web sites

Housing Assistance Council. "Model Loan Program Provides Assistance to Colonia Residents." <http://www.hud. gov/local/nm/groups/goodstory01.cfm> (accessed June 1, 2006).

Texas Secretary of State Roger Williams. "Colonia Legislation in Texas." <http://www.sos.state.tx.us/border/colonias/ legislation.shtml> (accessed June 1, 2006).

U.S. Department of Housing and Urban Development. "The Model Colonias Project: A New Mexico Success Story." ` (accessed June 1, 2006).