Financing A City's Vision (Case Study)
Financing A City’s Vision: The Social Mobilization of Land Values in São Paulo is a four-part documentary series created by the Lincoln Institute of Land Policy that explores a large-scale infrastructure project called the Água Espraiada Urban Operation in São Paulo, Brazil. Urban operations allow Brazilian cities to recapture the land value generated by land use changes and public investment. São Paulo employed a unique financing tool, certificates of additional construction potential (CEPACs), which are tradable development rights sold at public auctions. Featuring the voices of favela residents, city officials, real estate professionals, and a range of academics, the series examines the Água Espraiada Urban Operation from multiple perspectives.
These videos contain dialogue in both English and Portuguese. Subtitles are available in English, Portuguese, and Spanish. Click the “CC” button in the video player to enable subtitles.
Chapter 1: Development and Displacement
The first chapter of this four-part series covers the decades leading up to the creation of the Agua Espraiada Urban Operation—a large-scale infrastructure and densification project in São Paulo, Brazil. The video highlights three forces shaping the city during the 1970s, 1980s, and 1990s: the growth of informal “favela” communities, traffic congestion, and growing interest in the area’s real estate. When Mayor Paulo Maluf initiated a project to build a road along the Agua Espraiada stream in 1991, a decade before the urban operation was established, thousands of favela residents were evicted and the city was plunged into debt. From this context, the idea for the Agua Espraiada Urban Operation emerged. How might a city accomplish large-scale urban interventions without displacing residents or taking on debt?
Chapter 2: An Innovative Solution
The second chapter of the series explains what an “urban operation” is, how CEPACs work, and the inspiration behind these unique tools for major urban development projects. Community activism and a receptive administration in City Hall allowed a provision for social housing and services to be included in the list of interventions. A legal tool called special zones of social interest, or ZEIS, gave favela residents the right to housing on specific pieces of land.
Chapter 3: The Fight to Stay
In the third chapter of this four-part series, residents of the Jardim Edite favela community fight for their right to stay as powerful economic forces threaten to displace them. The first auctions of CEPACs are held, raising money for the famous cable-stayed Estaiada Bridge, but it’s unclear whether money will be spent on the community’s promised social housing units.
Chapter 4: Reflection and Renewal
The final chapter of the series brings us to today. The video reflects on the dramatic transformation that has taken place since the urban operation was established in 2001, much of it funded through CEPACs. The urban operation still has much to do to achieve its ambitious goals: the road needs to be extended and social housing for thousands of families needs to be built. As the city contemplates holding more CEPAC auctions, social housing advocates work to ensure that funding is available.