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Scholars and analysts alike believe that in principle, land readjustment can achieve five policy goals: [Return]First, land readjustment can increase development densities to make room for urban expansion and revitalization. A key component of land readjustment is re-plotting, so as to deal with fragmented landownership that can increase the costs of land assembly and infrastructure construction. Although not all communities like their neighborhoods to be subdivided into some grid patterns, the setting on the right-hand side of this slide does represent a more efficient use of scarce land resources. Households that have surplus land will be encouraged to put vacant space into productive uses. More importantly, land reconfiguration will also make space for widening roads and the construction of public parks and other community facilities. The neighborhood setting in the left-hand side may prohibit fire trucks from going into the neighborhood if there is a fire. Widening the local roads by land readjustment can mediate this safety issue without exercising the government’s power of eminent domain (or compulsory purchase). [Return]Second, land readjustment can also create the opportunities for the local government to implement its updated master plan. The location of the proposed schools and medical centers or hospitals could be incorporated into the re-subdivision plan. All landowners in the neighborhood will be asked to contribute a portion of their landholding for the construction of these public facilities. Using compulsory purchase will put most of the burden on households whose property happens to be at the location where the public facilities will be built. [Return]
Third, a very important aspect that separates land readjustment from other approaches is that it empowers the landowners to decide on the redevelopment initiative. In most land readjustment projects, the proposal will require the consent of the majority of the landowners. The threshold varies from 51 to 100 percent depending on the country. In Japan, private land readjustment projects need the approval from at least 75 percent of the affected landowners (or land ownership). In Bhutan, local governments decide to seek an unanimous agreement from landowners in their land readjustment projects. Besides, a cooperative or community corporation with members of the management team elected by the community will also provide ample chance for all stakeholders to involve in the design, implementation, and monitoring of the project. Thus land readjustment is relatively more participatory than other land development approaches, if implementing agencies do not overlook the significance of public participation. More importantly, land readjustment aims to minimize relocation of existing residents by returning a piece of serviced land to the participating landowners to rebuild their homes after the completion of the project. This can help avoid forced eviction and allow landowners to share all future redevelopment benefits with the municipality and other stakeholders. [Return]
Fourth, because land readjustment emphasizes on public participation and community engagement, it is a useful tool to foster social learning for building local governance. This is an invaluable feature of land readjustment because not only does it improve the living conditions of the residents, but it also help build community and collective actions. Through an intensive engagement of the community in every operation of land readjustment, members will learn their rights and responsibilities in the development process, allowing them to understand others’ preferences and priorities. This understanding will help stakeholders to accommodate each other's needs and come to a consensus on how they should redevelop their neighborhood collectively. This collective action could be the foundation of a workable local governance structure that encourages and enables residents to take ownership of the land redevelopment efforts that will require continuous maintenance and upgrades in the future. [Return]
Fifth, land development along with local infrastructure provisions entails capital investments. Some municipalities in both developed and developing countries may not have the fiscal capacity to undertake these projects. Another unique feature of land readjustment is to capture land value increments to recover development costs. This objective is achieved by reserving land space for sale through the revision of land subdivision. In balancing the need of land for public roads and facilities and the financing of the construction of this public infrastructure, implementing agency will ask landowners to give up additional land that will be pooled together into developable plots for sale at market value. The sale revenue from these land plots will then be used to defray part of the project costs. In principle, if the estimated land revenue generated from participating owners’ land contribution matched perfectly with the costs of land readjustment, the project could be self-financing. In practice, however, self-financing is hard to obtain because the matching could be complicated by the lack of reliable information or, most significantly, the resistance from landowners to give up a large percentage of their landholding to finance the project. Thus central or local governments may need to help the project financially. At the minimum, the idea of reserving land for sale to recover some of the development costs can lower the burden or dependency on public finances.
It will be unrealistic to state that all these objectives can be achieved simultaneously in all times and spaces. In some situations, the attainment of one goal may be at the expense of another. For instance, if the priority of the land readjustment project is to reserve ample land space for public roads and social housing, less land will be available for sale to recover the redevelopment costs. We can certainly mediate this tradeoff by increasing the development densities of the area. Yet the amount of human and economic activities that an area can accommodate is not unlimited, thus rendering this method nonviable in densely populated areas. Other tradeoffs may emerge depending on varying contexts. Hence it is important to keep in mind that these attainable policy goals are suggestive. What is most important is to establish an open and inclusive decision making process to allow the affected stakeholders to identify potential tradeoffs in accordance with the unique circumstance of the project at hand. Only through open and informed discussions can affected parties resolve some of the inherent tradeoffs based on their agreed upon priorities.
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