Envío Digital
Central American University - UCA  
  Number 189 | Abril 1997



Municipalities: Where Democracy is Born

Fortifying and insuring autonomy to the municipalities is a democratic task still pending. Why to do it? Today in Nicaragua the tendency towards municipalism could begin to meet obstacles in Liberal authoritarianism.

Alejandro González

Many models and paradigms have broken down in Latin America in recent years. At the same time, others are being built. Municipal autonomy, the strengthening of local power as a way to overcome poverty, is one of these new paradigms. In Nicaragua, the forces for and against this model are intensely active these days, and there are many signs that the contradiction will be around for a long time.

The strength and autonomy of municipal governments, the decentralization of the state and the transfer of central offices to the municipal level are responses to the extreme centralism that has characterized Latin American governments for decades, and that in Nicaragua appears to be gaining force again with the arrival of the Liberals to power. Latin American centralism is today accused of various things: of not having achieved development, of having achieved some level of it but without equilibrium, or of being precisely the cause of all the disequilibria typical of underdevelopment.

The trend to increase the competence of municipal governments and strengthen their autonomy is moving throughout Latin America. Electoral democracy, increasing the citizenry's participation in the search for solutions to problems, the struggle of all territories in each country to compete with the metropolis in development and economic growth opportunities are also international trends.

Will Arnoldo Alemán Support Municipalities?

Nicaragua is behind on the issue of municipalities compared to countries like Chile, Venezuela, Bolivia or Costa Rica. The obstacles to strengthening local governments and making them more autonomous in Nicaragua are as varied and conflictive as the national political scene, but the forces that can fight to advance this process are determined to break down these obstacles.

President Arnoldo Alemán often reiterates his "municipalization vocation" but his support for municipalities appears only for the microphones and cameras. In its actions, the Liberal bench in the National Assembly is resisting passage of critical reforms to the Municipality Law to bring it into agreement with the 1995 Constitutional reforms. The centralism and authoritarianism that President Alemán is showing could leave Nicaragua behind the pro-municipal tendencies of the rest of the continent.

Many sectors favor strengthening municipal autonomy and challenging authoritarianism on various fronts. These include opposition Sandinistas, many of the local governments in Liberal Alliance hands, all the local governments in FSLN hands, various sectors of civil society, the Sandinista bench in the National Assembly, Liberal representatives who support the country's real modernization and representatives of other minority benches.

The previous legislature passed the Municipality Law reforms but they were within the package of laws and decrees that the Supreme Court annulled on January 7. The discussion of this same proposed law in the current legislature has once again placed the municipal issue on the long list of pending issues complicated by the country's political contradictions. If discussion and approval of the municipal reforms in the Assembly is prolonged, or if substantial changes to the proposal are approved, there will be open conflict between those who support presidential centralism and those who want to democratize power by strengthening local governments. If the proposed reforms to the Municipality Law are approved as currently set out, they will financially and politically strengthen local government and make it possible to continue fighting for more responsibilities.

According to the bill, the executive branch would have to give local governments 5% of the country's general budget. It would also have to give over 30% of income earned through granting exploration and exploitation concessions and licenses for natural resources located in municipal territories, and grant the municipalities the right to participate in debates about those concessions. The reforms would necessarily generate contradictions by transferring income, rights and prerogatives to local governments that up to now have belonged to the executive branch.

Will all these Laws be Approved?

In addition to reforms to the Municipality law, other pending legislation affecting local governments includes bills on Career Municipal Administration, Citizenry Participation, the creation of a Municipal Affairs Commission in the National Assembly, the creation of Local Development Councils, a bill regulating municipal participation in foreign investments, the establishment of a theoretical model for municipal territorial planning, a bill regulating private enterprise participation in municipal public services management, etc. Having an appropriate debate that culminates in the approval of each these laws would be a valuable contribution to strengthening Nicaraguan municipalities, but it will not be easy. The conflict of interests that each of these legislative tasks implies will add important political clashes to the already overcharged political panorama.

There should also be a definitive political-administrative division in the country, clarifying some 78 boundary conflicts currently existing between many municipalities in the Pacific and in the Atlantic Coast autonomous regions.

Will There Be Resources For So Many Tasks?

The point of departure for the most advanced pro-municipal currents of thought is a reconceptualization of the municipality. The municipality is seen not only as a provider of "municipal services" such as trash collection and treatment; street cleaning; care of parks, cemeteries, markets and dumps; drainage construction for rain run-off, etc. The "new" municipality should take on those tasks, but that is not enough. The community is increasingly demanding that its mayors respond to an ever expanding set of problems: health, education, transport, recreation... And the trend is for the municipality to respond.

More obligations, more responsibilities. But how much of these tasks should the municipalities take on before the executive branch just lets go of them to make its own life easier? The municipalities should take on all the obligations they can handle and all those that they can negotiate, as long as new responsibilities are met with enough financial backing to support them.

Municipal obligations in Nicaragua are even more confusing. And those that are evident and clear -basic municipal services- cannot be carried out due to lack of money or support. The communities pressure their mayors to do thousands of things: install electricity, dig wells and install plumbing for drinking water, build schools...but all of this is the responsibility of the national energy or water institute or Ministry of Education. In recent years, local governments have built dozens of classrooms and health centers, responding to the demands of local residents, but to do so they have had to divert financial resources and efforts from other tasks that are more clearly their responsibility. "The reality is that in Nicaragua we in the municipalities have geared our activities and responsibilities according to what our communities have demanded," comments Juan Ramón Jiménez, mayor of El Rosario.

The perspective being looked at for the future is for local governments to formally expand their responsibilities to include all these tasks that they are carrying out anyway. The ideal would be to have assured resources for these projects and to do them well. This ideal has an important basis: local governments are more financially efficient than the central government. "With the same amount of resources used by the Ministry of Education to build one classroom, we can build two or three," proudly says Luis Antonio Matus, former mayor of Santa Teresa.

Growing in responsibilities and attributes, expanding their field of action, local governments should be changing into enterprises that offer prompt service and are competitive in efficiency. That local "enterprise" has an infinity of tasks, a small world to transform. It must facilitate and promote its community's integral development; foster economic growth; help eradicate poverty in its territory; save traditional cultural expressions; preserve the environment; promote cultural, sports and recreational activities; plan the development of its territory in the short, medium and long term; promote municipal tourist development; rescue and value municipal history; create and strengthen local archives; promote the training of municipal human resources, etc., etc.

What does the Municipality Get?

Local governments should create conditions for economic growth in their municipalities, creating more job sources and attracting businesses with national or foreign capital to their territories. They should know how to move in the world of economic competition and marketing, "offering" their municipality. Naturally, a municipality with paved roads, telephone lines, good water and electric service, natural resources, tourist sites and an academically qualified population has more to offer. This way, everything that is considered well-being for the community is at the same time the basis for the community to "offer itself" and attract productive investments, tourist enterprises or even assembly plants -which if they do not offer quality jobs at least offer quantities of jobs to alleviate unemployment.

In the wave of regional integration and economic globalization, local governments have an opportunity to make room for investments in their territories and thereby gain more jobs for the people and a bigger tax base for the mayor's office. What jobs and how many taxes? Bonanza may be Nicaragua's municipal seat with the highest employment level. "Ninety-seven percent of our population is working," claimed then -mayor Eugenio Pao at the end of 1996. Some work in the mines-given as concessions to a Canadian company-and others in mining cooperatives, trade and services linked to the mines and above all, panning for gold. When they are not working, men, women and even children go pan and find something. That's the major source of employment, but it demands enormous physical effort for minimum income. Everyone works in Bonanza, but there is great poverty. Any job at all is no solution for people.

And not for the municipality either. Various large and powerful businesses have set up in the area around Bilwi (formerly known as Puerto Cabezas), including lumber and fishing exploitation, shrimp and lobster packaging and export. But they do little for the local government. The licenses and permits are paid to the central government and the periodic taxes are collected by the regional government. These businesses generate some jobs but offer very few taxes to the local government, and they destroy forests and pollute water. Environmental deterioration is about the only thing the municipality is receiving in great quantities.

The San Antonio sugar refinery in the municipality of Chichigalpa pays few taxes and employs few people in comparison to the problems it causes: the trucks transporting sugar cane destroy the streets and roads in the municipality, while the production processes contaminate many surface and underground rivers as well as the soil. And the entire city of Chichigalpa is covered with ashes that travel on the wind when the canefields are burned, causing respiratory problems in the population.

"The municipalities should encourage factories or job centers to settle in their territories, but not just like that," councils Isidro Jirón, in charge of the Nicaraguan Municipal Promotion Institute (INIFOM) in Region IV. "They should learn how to negotiate with investors and businesses so that the municipality gets concrete benefits: jobs, taxes, human resource training, community activities financed by the businesses, schools and sports clubs sponsored by them. They should receive benefits in various directions."

Who Owns the Wealth?

Many Nicaraguan municipalities have a lot of economic potential. There is gold, silver and other precious metals in Siuna, Bonanza, Rosita, Santo Domingo, La Libertad, San Carlos, El Castillo. Still unexplored petroleum potential in Bilwi, Pearl Lagoon, Waspám-Río Coco. Lumber resources for building materials, hydroelectric and geothermic potential. Immense areas of fertile land are found on all sides.

How can the exploitation of all these resources be translated into economic growth and human development in the municipalities where these resources are located in the short, medium and long term? So far, the only things left to their owners have been tunnels, desertified land, contaminated water and more poverty. A model experience is the struggle of Nindirí, Masaya, to make sure that the exploitation of basalt that the Chamorro government gave in concession to a construction company turns into authentic earnings for the municipality, which owns the land where the basalt mines are located. The fight was complex and drawn out, but successful. Through it the local Nindirí government got financial backing that is the envy of other municipalities.

Strengthening local power requires that the municipalities be the main beneficiaries of the exploitation of their natural resources. "This may possibly be the point of greatest conflict between local governments and the central government," says Alejandro Bravo, of the Center for Constitutional Rights. "This is where the greatest conflict of interests lies. But if the contradictions are resolved in favor of the municipalities, the advance of local development will be notable."

Who Defends the Environment?

A new task for municipal governments in undertaking these just fights is defense of their territories from the environmental damage that goes hand in hand with certain kinds of "development": contamination of rivers through pesticide abuse in cultivation areas or destruction of ever more trees. If the damage already exists, the few municipal resources cannot do much, though it is always possible to rescue some stream or to reforest. We must also not forget that municipalities themselves contaminate with garbage dumps and slaughterhouses.

Local governments should demand decontamination mechanisms from the enterprises that move to their areas, and any necessary upgrading of machinery and equipment for those that are already there. In this respect, many Nicaraguan municipalities have a big job ahead of them. In Granada, two soap factories, a paper factory, a cooking oil factory and some other businesses are turning the lake's beaches, with their tourist potential, into a focal point of environmental hazard.

Life is disappearing from rivers near Bonanza because of the volumes of cyanide used to wash gold that is then dumped in their waters. In Santo Domingo, open pit mines affect the soil which also affects the rivers. In Nandaime, Potosí, Belén and Rivas, the excessive use of pesticides and herbicides in thousands of acres of sugar cane affects the underground and surface waters. In various Atlantic Coast municipalities the challenge is to halt devastating deforestation, and to put rational limits on the irrational shrimp and lobster fishing which could otherwise wipe out these resources in only five years.

Taking up the banner of these environmental struggles is new for the municipalities. In the process, the municipalities can be strengthened, as can the local population's participation. Community participation in the challenges facing local power is another point of departure. There are many spaces for participation by people of both sexes and all ages: health commissions, clean-up campaigns, project commissions, environmental commissions, self-construction brigades, consulting commissions to the mayor's office for certain activities, sports clubs, ecological groups... "The more people participate, the more municipal governments can get done and the stronger local government will be," argues Isidro Jirón.

How to Convoke Participation?

There are already notable experiences of participation in Nicaragua. El Rosario, Carazo, reelected its mayor, Juan Ramón Jiménez, for the third time in October 1996. The secret? It's a model local government in popular participation terms. Citizens' commissions have supported the mayor's office in the construction of the baseball stadium, park, health center, basketball court and street paving.

There has been an environmental commission in Santa Teresa, Carazo, for many years that supports the mayor's office in defending, protecting and technically studying the zone of Chacocente, a special ecological reserve where thousands of turtles come to lay their eggs annually.

Another mechanism for participation is the creation of auxiliary mayors in zones and areas isolated from the municipal seats. This gets more people committed, makes the work of local governments more agile and brings the mayor's office closer to the community. Coordinating municipal work with local NGOs also promotes participation, since they have communal support networks and valuable experience in promoting population participation.

The fundamental issue is the ability of municipal government members to convoke organized groups and the entire community to participate in local tasks to resolve community problems. The acute political polarization in some areas puts a limit on this goal. In such areas the Sandinista mayor will have an extremely hard time getting anti-Sandinistas to participate, and vice versa.

Will they be able to Collect Taxes?

Municipal strength and autonomy has feet of clay if the municipality is not based on the solidity of sufficient and guaranteed financial resources. The more financially self-sustaining a municipality is, the more it can demand and pressure the central government to transfer obligations to it. That financial self-sustainability will help give the municipality administrative efficiency, an ability to collect taxes, creativity to open channels of cooperation with local and international NGOs and broaden its sister relationships with the municipalities of other countries, and the ability to create productive enterprises and get credit from banks and from the state.

A municipality cannot be autonomous without its own finances, and much of that financing comes from taxes in the municipality. It is critical for the municipalities to set up a Municipal Property Registry as soon as possible, so that they can collect the tax that is their oxygen: the Real Estate Tax (IBI). The IBI could become a source of considerable income. Granada, Masaya, Jinotepe, Rivas, León, Chinandega and some others will have their Property Registry in the first half of 1997, and, according to INIFOM, all municipalities in the Pacific and central areas of the country will have theirs in the next two years. It may take another two years on the Atlantic Coast.

Income from other municipal taxes-annual vehicle registration and navigation fees-is not guaranteed. These taxes should be paid in the municipality of residence of the vehicle or ship owner, but some mayors' offices pirate the taxes of other municipalities by selling the registration stickers at lower than official prices.

Over the last eight years the Tax Plan-a list of taxes that the mayors' offices have a right to charge-has been the basis of municipal tax income. Today some municipalities, like Nindirí, have very good income, 97% of it from the Tax Plan.

According to the proposed reforms to the Municipal Law that the National Assembly must still debate and pass, 5% of the national budget should go to municipal governments, of which 30% will be for administrative costs and 70% for local investments and projects. If that disposition is approved, it will be a substantial relief for the municipalities; they will have a fixed fund to guarantee their functioning and a permanent minimum fund to carry out works to benefit the community.

But the central task of local governments, if they want to increase their incomes, will be to develop a consistent campaign to promote the citizenry's responsibility. The minimal credibility of authorities, the economic crisis, high unemployment, constant cases of corruption at all levels of public administration and the firmly established tradition of not paying taxes all mean that people do not understand their fiscal responsibility and that tax collection will always be very deficient. Changing the mentality of the citizenry and making local power credible could begin to turn this tendency around.

So Many Dispersed Efforts

Making progress in municipal strength and autonomy, in decentralizing the state and democratizing power by making local government stronger are not easy tasks. And they are new tasks. Today, a new obstacle is found at this crossroads of Nicaraguan democracy: the authoritarian and centralist tendencies of the Liberal government. But the time is ripe to challenge these tendencies. There are already good examples of vigorous local power and, although they are dispersed, they can unite.

Among the country's 145 municipalities-as well as others in the process of forming-there is a great and rich variety of possibilities, including possibilities for cooperation. Immense municipalities and very small and manageable ones. Municipalities with great financial potential and others with none. Urban and rural municipalities. Some with economic infrastructure and others with none. Some with skilled human resources and many with high illiteracy rates. Some Sandinista and others Liberal. Municipalities with experience in war and in peace negotiations, others inexperienced in that, others still in conflict. All of them share the common interest of their governments to get stronger and do a thousand and one things for their people.

The idea that a strong municipal government helps reduce poverty can grow. The idea that the first beneficiaries of natural resource exploitation in a municipality should be its own residents can also grow. And when a municipality begins to turn these ideas into reality, it will become a model for others. Bit by bit, municipal autonomy can be the music that many want to sing. From the pages of envío we want to tune in to that music.


1524: With the founding of Granada, the first municipality was born in Nicaragua. During the 300 years of colonization the municipalities had a local government with power and autonomy.

1821: The municipalities retained their power and autonomy with independence and the formation of the state.

1826: Departmental divisions were created, grouping various municipalities together.

1830: The first Municipal Law was pas sed, establishing norms for municipal attributes and responsibilities.

1894: In the Constitution passed that year, the Liberal Zelaya government included the basic principles of municipal autonomy: municipal elections, autonomy to establish taxes and municipal independence from other state powers.

1937: Somoza eliminated municipal elections. The local boards became directly dependent on the executive branh.

1937-1979: During the Somoza years the municipalities lost all characteristics of local government and lacked administrative, financial or political independence. Somoza eliminated the Managua mayor's office, replacing it with the National District.

1963: The Somoza regime reinstituted municipal elections as a result of one of the pacts between the Liberal government and the Conservatives.

1978: point of greatest decay among Nicaraguan municipalities.

1979: The revolution creates Municipal Reconstruction Boards. Some had sprung up during the insurrection in cities liberated by guerrilla advances. The first was Diriamba. The Municipal Affairs Office was created to coordinate and direct Board activities throughout the country.

1982: The FSLN government regionalized the country, sending more technicians and professionals to the territories. It created greater presence of state institutions in the municipalities with a larger volume of financial and material resources and a broad range of activities in benefit of the local population. It substantially increased municipal responsibilities, but clearly subordinated Municipal Boards to regional government delegates. Municipal autonomy did not exist.

1988: The FSLN government passed the Municipal Law, the most elaborate and valuable political-legal resource in the history of Nicaragua's municipalities. Municipal Councils were established and their responsibilities detailed, opening the wayfor municipalities to take on all the obligations they could handle.

1988: The FSLN government passed the Tax Plan, giving municipalities excellent possibilities for financial self-sufficiency.

1989: The FSLN government passed the Law of Political Administrative Division of Nicaragua and created the Nicaraguan Institution of Municipal Promotion (INIFOM). It also passed the Regulations for Municipal Functioning and Organization.

1990: First direct election of Municipal Councilors since revolution; they elected the municipal mayor from among themselves. Their term of office was six years but the mayor could be replaced at any time by a majority vote of councilors.

1990-1996: During the Chamorro government, INIFOM carried out the valuable task of training municipal government personnel and promoting an understanding of the value of municipal autonomy in the municipalities.

1995: As a result of reforms to the Constitution, municipal mayors will be directly elected by the population and the term of office for mayors and municipal councilors was reduced to four years.

1996: In the immediate post-election period, the outgoing National Assembly approved an excellent Municipal Law reform, achieving complete municipal financial autonomy and opening the possibility for local governments to take on more obligations. On January 7, 1997, the Supreme Court annulled the reform and all other legislation passed in that period at the urging of the incoming government.

1997: With the installation of newly elected mayors in the 145 municipalities, trained and experienced municipal administrators, services officials, accountants, secretaries and others were fired in a high percentage of the 92 mayors' offices won by Liberals. Millions of dollars and incalculable efforts in workshops, seminars and other learning opportunities were thrown to the winds of political irrationality.

Print text   

Send text

<< Previous   Next >>


Whither US Solidarity with Nicaragua?

Municipalities: Where Democracy is Born

All Threads Lead to The Property Tangle


The Dead in the West's Basement

Estados Unidos
The US Drug Fight: A Form of Social Control
Envío a monthly magazine of analysis on Central America
GüeGüe: Web Hosting and Development