This essay is part of a series that examines the roles that community-based organizations (CBOs) have played as active participants in the process of "governing" megacities—whether in service delivery, risk mitigation, or the creation of livelihood and other opportunities. More ...
Chongqing is a river port in southwestern China at the confluence of the Jialing and Yangtze River. In 1997, shortly after the completion of the Three Gorges Dam—which was designed to generate electricity, increase shipping capacity, and mitigate flooding—Chongqing was promoted to a national-level city, on a par with Beijing, Tianjin, and Shanghai. Like all municipalities in China it administers a rural hinterland, in this and most other cases around a constellation of county-level cities, as well as the main urban area; in fact, only a tenth of the rural population of China resides outside such municipal administrations. Chongqing’s total population was 33.4 million in 2012, of which 13.2 million was non-agricultural. The city is the growth and transport hub of the 1999-2020 State Council’s Western Development Strategy of industrial transfer from coastal regions. Rail routes to Europe—16 days’ freight to the Ruhr-Rhine port of Duisburg—and to India and Southeast Asia have been constructed. In 2009 the State Council approved the city's urban-rural master plan, which includes housing projects that can integrate rural-urban migrants with the urban-registered population, in line with the plan to increase China’s urban population and its domestic consumer market.
Public Rental Housing Projects
The 12th five-year plan in 2013 set a target of 36 million new units of public housing provision in the Peoples’ Republic of China (PRC) because affordable housing has so far not met the needs of lower-income residents, or even lower-middle-income residents.
The structures of financing, planning, and governing housing projects are similar to those in every other city in China; their novelty in Chongqing is in their scale and in some of their variation. I will focus on its public rental housing projects, whose scale is unmatched by any other Chinese city, and is outstanding for keeping its stock because tenants can buy their apartments after five years but can only sell them back into public ownership.
Public housing rent is at 60 percent of the average market rate in the area. To qualify, an applicant must have a steady income and own no housing or be in housing difficulties. Application is open to all, from new college graduates to migrant workers, and there is a special provision at ten percent of market rent for those on welfare payments, with disabilities, unable to work, including ex-prisoners and those receiving treatment for drug abuse. It is therefore a major initiative to integrate migrants, ex-farmers and other groups of urban residents. The standard of construction is as good as middle-level commercial housing, but the space per person is less. The actual quality of materials is good, but construction has been somewhat compromised due to its speed, as we found from residents in MX the first of these projects to be built. Construction and management are open to bidding by private companies, their architects, and property management companies (PMCs).
Minxin Jiayuan (MX) was the first of 21 planned public-rental housing projects in Chongqing to be built.
Minxin Jiayuan (MX) was the first of 21 planned public-rental housing projects in Chongqing to be built. When we studied it in 2013, MX was composed of six gated zones of tower blocks, ranging between 20 and 33 stories in height, 54 blocks in all, housing a population of about 45,000. The apartments range in size from studio to three-bedroom, with full fixtures, utilities, and interior decoration, ready to be occupied but unfurnished. Selection from qualified applicants was by lottery, as was allocation, so that an elderly or infirm resident could be allotted an apartment in a high story.
Central government funding partially finances the building of these publicly owned apartment blocks, but more funding comes from city government revenue from tax on high-end commercial property, fees on land-use lease transfers, and other sources. The greatest amount of funding, however, comes from loans. Interest on the loans is paid by the rents from residents and the sales of ten percent of each project to commercial outlets at market price, while the capital loan will be paid by the funds created by residents who opt to buy their apartments at about 60 percent of the commercial market rate after five years of residence. The payment back of the capital loan therefore depends on how many residents will want to buy and how many will stay and not sell back. Even the interest payments remain an issue after construction because they depend on full occupation and therefore that there is a requisite number of qualified applicants for the apartments built. In short, the financial plan is thorough but still risky.
Three of the eight large municipally-owned enterprises are responsible for the projects’ construction. The land on which the projects are built was accumulated by one of them and the rest of its land bank is surety against the loans from banks, insurance, and provident fund groups and bond sales that provide the bulk (70 percent) of the finances. These municipally owned enterprises are market-oriented, profit-making transformations of loss-making state-owned enterprises, whose debts have also been assumed against the land bank as collateral. Between 15 and 20 percent of their profits are remitted to the municipality as revenue for social welfare projects.
New land for urban development, all over China, is only available if an equal amount of land is made available for agricultural use. This is a policy that has been flouted for years because the compensation for land collectively owned by villages is reckoned at values of their agricultural product and the costs of village housing, not the value it acquires as urban estate, which is many times greater. The difference is the main source of revenue for municipal governments and the projects with which they are charged by central state policies, and is also used for enriching local government officials. Villagers’ grievances about this are among the biggest causes of mass protest in China. Therefore, the Chinese Communist Party at the center has sought to compensate villagers at higher rates, set by statute. In addition, since 2008, Chongqing has used an auction system to raise the value of land freed for arable use and the “land tickets” (dipiao) that this makes available for urban land developers (but not the municipal corporation building infrastructure and public projects), to take over the equivalent amount of arable land, all administered by the city’s Rural Land Exchange. Even in remote, mountain villages, this ticket auction system has raised the value of the land that villagers free by moving to urban residences or to denser, high-rise village accommodations. Complementing this, villagers in the suburban arable land purchased for urban use are also paid a higher rate for their land. Further, if they have a steady income they can enter the lottery for the public housing that Chongqing is building on such a large scale.
Nevertheless, the dislocated farmers say they feel “lost and psychologically upset”, “It was very difficult to find a new job, and the transport was so inconvenient to get to work. Being a farmer was much better!” But “we have no choice."
Governance and 'Self-management'
The system of governance and management for public housing is “Tiao Kuai”—vertical and horizontal. The public rental office, police station, and city management are “vertical” and manage a fixed range of issues, while Residents’ Committees (RCs) and street offices are horizontal and manage local community (shequ) affairs, but are overseen by the municipal office of Comprehensive Management. The PMC is under the supervision of both the RC and the rental office. As in every city this requires a coordination mechanism, and the street office initiates the formation of a single party branch combining the leadership of the horizontal offices and liaising with the others.
At that time  the whole estate was managed by one rental office, one RC with the prospect of two further RCs being created, and one PMC. The PMC organizes external repairs, maintenance, and security from its income raised by fees from residents. This income is never enough to provide the services that residents want, but residents are not able or willing to pay the higher fees required. The PMC also helps residents find services for internal works in their apartments, for which the residents pay. The RC-paid staff work alongside staff of a welfare office under the Ministry of Civil Affairs in a shared office.
Theoretically, RCs are statutory organizations of representative self-management. In reality, however, few residents take part in elections and the candidates are nominated by the local branch of the party and are vetted by the office of the street (in fact a large territorial area of jurisdiction). The RC representatives perform voluntary mediation and surveillance functions as staircase or block representatives. Other volunteers organize recreational activities in the open spaces and at the cultural center rooms of the RC. Like the block representatives, they are all retired (over the age of 50 for women, 60 for men) and likely to be in touch with the welfare service center that shares the office space of the RC. The rental office had, by contrast, contact with all project residents, for obvious reasons.
MX hi-rises with dog grooming parlor in the foreground
Because the public rental housing policy was not fully formed, much of its detail was being created at the base. For instance, the rent office received complaints about a very wide range of things that were not its responsibility, so it put up a notice board outside the office listing the telephone numbers for government departments and their responsibilities. This initiative was then repeated in the other projects. Among other issues that arose were the possibility of exchanges of apartments between residents and the price of apartments for purchase. RC and rental office staff fed these policy issues back up the hierarchy and, in the case of allowing apartment swaps, got a positive response after two years.
The functions of mediation, demographic surveillance, and cultural activities are shared between the paid staff of [Residents' Committees] RCs, volunteers, and police ...
The functions of mediation, demographic surveillance, and cultural activities are shared between the paid staff of RCs, volunteers, and police, just as the sharing of the function of security is shared between a private company, the PMC, and police. It is evident that the local municipal state in China is extended outwards from its formal administration. Low-level paid officials and volunteers, as well as private companies such as PMCs are engaged in improvising policy details that are fed back up to be eventually endorsed. In addition, the party and its mass organizations at the local level are engaged in a didactic, but also helpful mobilization of what many still refer to as the masses.
To encourage greater responsibility among tenants for their common, shared spaces and their fellow residents, the party's Youth League started Citizens’ Schools (Shimin Xuexiao), finding volunteers to run them. Their activities include helping children left in the care of grandparents with their homework after school; visiting disabled and infirm elderly tenants; classes in singing, English, cooking, and other household skills; a hotline for psychological counseling; lectures on health; and informational sessions on obtaining bank loans. The local party branch dealt with complaints that come into the responsibility of the offices and the police station and regularly put up a list on the notice board of the number of complaints of the different types that it had handled over each period and the action initiated. They included lack of parking space for electrical bicycles, which was not included in the plan. As we found to be common in other RC areas, there were also complaints about lack of security patrols and slow response to reported disrepair on the part of the PMC, about other tenants allowing their dogs to defecate everywhere, and about the uncivilized conduct of the welfare tenants and the rural old. But generally there was satisfaction, including with the landscaped public spaces, which are often used for community activities: resident-organized dances, family strolls, playing mahjong and so forth.
A less successful community-building activity by the rental office and the RC were monthly neighborhood festivals. The festivals were initiated to teach habits of lining up for busses, of maintaining hygiene and safety, as well as joining in dancing, painting, and singing contests. These were poorly attended; in fact, free drinks provided by a commercial company on one occasion were the main attraction, according to residents interviewed.
What all this shows is how much was left to the initiative of local offices, whose staff complained of the lack of policy guidance and how slow upper levels were to respond to requests for policy guidance. The staff also said that they have to contend with new urban residents who are not used to living in high rises and the dangers of throwing things out of windows or of putting flower pots on windswept window sills, who do not know how to use security swipe cards, who plant vegetable gardens on roofs or breed chickens in public spaces.
The most serious issue for the public rental housing project, however, is whom it excludes ...
The most serious issue for the public rental housing project, however, is whom it excludes: those without access to television where the new projects are advertised or to the web through which applications are made, those who cannot get a letter from their employer to verify that they have a steady, mid-range income, and those who did succeed but cannot sustain that income or maintain themselves and their dependents because of their casual work and because of the relatively high cost of living in the project area.
At the other end of the income scale, young graduates want to work hard and leave as soon as they can, because to live in subsidized rental housing is a stigma when it comes to marriage prospects. The high ratio of infants to caregivers in the nursery schools and the quality of teaching in the primary school was also a cause for concern. In general, these and other facilities, such as the clinic, play a large part in maintaining the attractiveness to applicants upon which the whole project depends, yet their financing was not adequately included in the plan.
MX is centrally located near industrial parks. RC job fairs were quite successful in finding work for ex-farmers, who were from Chongqing, Sichuan, Shanxi and even further afield. But projects being built further out must depend on the simultaneous creation of nearby jobs.
The excluded must find, as usual in Chinese cities, cheaper rented accommodation from small private landlords, often in old work-unit housing and in village-owned housing absorbed into the city. At the other extreme, there are several grades of commercial housing estates for those with higher incomes who want to establish an exclusive lifestyle. In the higher-income estates, the RC has no presence and the PMC functions well because the fees it charges are adequate.
As we have found in all four of the cities in our research project, in areas of the majority income groups, staff in city offices, RC and its service center, and the PMC are overworked, underpaid, and expected to use their own initiative. They are blamed for policy failures, while higher levels are made to look good by the promises they seem to offer by their announcements. They have to be coercive, while often sympathizing with the victims of coercion and regret their falling short of the ideals of what their job could and should be—serving the local residents.
Chongqing in particular shows the intriguing mix of commercial markets in land use rights and commercial development with municipally owned but profit-making corporations. Its “community” formation and social management is a mix of municipal administration, party coordination, volunteers, and private property management companies as in every Chinese city, but with more municipal involvement in the case of the huge public rental projects and the integration of rural migrants and the restructuring of villages in the hinterland.
 The research for this article was conducted for the EC-funded project on sustainable urbanization in China 2010-2014, Work Package 5 on community governance. In particular, this article depends on the research conducted by Dr. Zhang Hui of People’s University of China. It also relies on the final report of Work Package 3 on urbanization, by Athar Hussain, Liu Weidong, Wei Gong, Michael Dunford and Zong Huiming.
 The others were Shanghai, Kunming and Huangshan.