The proposed Legal Framework for Self-Management Law, available for review and comment below, creates the Regulatory Framework for Self-Management and the National Program for Self-Management of Housing Production at a national level in Brazil. The law seeks to address the severe housing crisis, which profoundly affects low-income residents and impacts many essential facets of life – access to employment, healthcare, education, and security. The law provides an alternative to for-profit housing through a model of collective property and self-management that protects housing production from commodification, ensuring long-term affordability and security of tenure.
The bill establishes, among other things:
Key principles of self-management in housing and relevant definitions (Ch. 2, Art. 2-3);
Income levels that qualify for the program to ensure housing provision is prioritized for the lowest incomes (Ch. 3, Art. 4);
Levels of qualification for organizations to participate and provide housing through this program in order to ensure legitimacy and quality of housing providers (Ch. 3, Art. 6);
Processes for selecting housing providers and projects (Ch. 3, Art. 7-9);
Funding sources that may be used to execute projects under the program, and the direct and indirect costs associated with the program (Ch. 3, Art. 10-14);
A collective property ownership structure, and the transferability of collective property (Ch. 4, Art. 15 and 18); and,
Rights and obligations of residents of a housing project (Ch. 4, Art. 16-17).
For three decades, UNMP has successfully built housing through self-management. Legislation would allow a significant scaling up of the program, provide programmatic security and stable funding, and establish clear qualifications and processes for the provision of housing. The law also protects housing via self-management from changes in municipal, state, and federal governments. In short, the legislation makes third-sector organizations legitimate and secure housing producers in Brazil. In line with the principles of the movement, UNMP crafted the bill through a democratic and participatory process inclusive of its members. UNMP is now providing further opportunities to provide feedback on the proposed legislation, and your participation matters!
Please review the proposed legislation below and provide feedback via comments at the end of the webpage, referencing section and article numbers where appropriate. Feedback may come in the form of critique and suggestions for improvement, identification of potential unforeseen issues or complications, and/or endorsement of particular components that you like. This feedback is extremely valuable. UNMP will read and carefully consider this feedback as it refines the bill.
The Proposed Bill
Art. 1. This law approves the legal framework of self-management, creates the National Program of Self-Managed Production, establishes its principles, definitions, and objectives, and makes other provisions.
The principles, definitions, objectives and other changes promoted by this law aim to stimulate the housing associativism/cooperativism and cooperative system through self-management and mutual assistance as ways to guarantee the participation of the population as a protagonist in the solution of their common housing problems within the needs and characteristics of local customs and habits.
Art. 2. Principles of self-management enterprises in housing:
I – Guaranteed access to decent housing;
II – Priority for low income;
III – Stimulation of social production of housing;
IV – Stimulation of housing associations and cooperatives;
V – Stimulation of non-market housing production;
VI – Stimulation of direct participation, democratic administration and assembly sovereignty in enterprises;
VII – Stimulation of mutual aid;
VIII – Stimulus to the development of educational and pedagogical processes of emancipatory character;
IX – Guarantee the right to the city and environmental sustainability of territories;
X – Right to specialized and interdisciplinary technical assistance;
XI – Raising construction standards and improving housing quality;
XII – Valuation of social technical work;
XIII – Stimulation of collective forms of enjoyment of the use, possession, or ownership of housing units;
XIV – Development of enterprises in an environmentally sustainable manner;
XV – Exercise and demonstration of transparency in resource management and fair distribution of results; and
XVI – Building security and resource rationalization.
Art. 3. For the purposes of this law, the following are considered:
I – Housing Self-Managed (Autogestão) Production – the process of housing construction and requalification or land regularization of Social Interest (Reurb – S), in which the members organized in non-profit associations or production cooperatives with proven performance in housing policy, and with the help of technical assistance, in a regime of direct democracy, control the stages of conception, planning, development, and execution of housing projects and social work, exercising all the activities of work administration and definition of the form of organization of post-occupation;
II – Technical assistance to a multidisciplinary team, organized as a legal entity or as a service provider in the individual modality, integrated by at least two professionals with training in the areas of architecture, urbanism, engineering, law, sociology, political science, history, anthropology, pedagogy, letters, social service, or economics;
III – The set of strategies of social technical work, processes and actions, carried out from integrated and participatory studies and diagnoses of the territory, including the social, economic, productive, environmental and political-institutional dimensions of the place and the participating families, in order to qualify their participation in the construction process and in the formulation and execution of other related public policies;
IV – Training: the educational and/or pedagogical processes applied to the participants of housing associations or cooperatives and technical advisory services, aimed at providing them with increased autonomy, critical awareness and decision-making capacity, materialized in meetings, courses, seminars, workshops, and didactic subjects;
V – Preliminary studies: execution of legal, engineering and financial feasibility studies to organize the group of participants in future housing developments, even if disconnected from ownership or property of the real estate object of the analysis;
VI – Mutual aid or self-managed mutirão: the intellectual or physical labor made free of charge and in solidarity and dedicated by the future inhabitant in collective processes to the construction of the housing enterprise in which they will be assisted, regulated by the internal documents of the association or cooperative to which they are linked;
VII – Associative contribution: the financial resources approved in the form of the internal regulations of the associations or cooperatives for which the member is responsible and necessary for the operation of the organization;
XIII – Promoting entities are the associations regulated in Articles 53 to 61 of Federal Law 10.406, of January 10, 2002, as well as the cooperative societies regulated in Federal Law 5.764, of December 16, 1971, which in both cases must demonstrate, in the selection process promoted by the public power, proven performance in the housing area;
XIV – Qualification is the process of accreditation of promoting entities to act as takers of the resources, within the national program of self-managed housing production;
XV – Framework is the process of hierarchizing proposals, making them compatible with the budget forecast for the relevant fiscal year; and
XVI – Community facilities are the buildings or works complementary to housing intended for health, education, safety, sports, leisure, community living, generation of work and income, child care, the elderly, the disabled or special needs person, whose property will be in favor of the entity promoting the enterprise.
SECTION – I – The purpose and structure of the National Program of Self-Contained Housing Production
Subsection I – The purpose of the program
Art. 4. The purpose of the National Program of Self-Managed Housing Production is to provide financing for the preparation of preliminary studies, projects and works for the individual or collective acquisition of new housing units or upgrading of urban properties for families with income up to 5 minimum wages (SM), with the distribution of resources considering the profile of the deficit in the State, FJP.
I – The National Subprogram for Capacity Building in Self-Management, self-managed development and projects;
II – The National Subprogram of Production or self-managed housing requalification;
III – The National Subprogram of Self-managed Land Regularization of Social Associations and Cooperatives; and
IV – The National Subprogram for the acquisition or feasibility of real estate for interest.
The per capita family income values defined in the caption of this article shall be updated annually, every January, according to the Broad National Consumer Price Index (IPCA) or whatever may replace it.
Art. 5. The enterprises may be instituted in the following forms:
I – Parceling of the soil provided for in the form of Federal Law 6.766 of 19 December 1979;
II – Establishment of a building condominium, pursuant to Federal Law 10406 of 10 January 2002 and special legislation;
III – Self-managed housing complex in the form of this law; and
IV – Land regularization project of social interest in the form of Federal Law 13.465, of July 11, 2017.
Art. 6. The program manager shall be responsible for the qualification of the promoting entities interested in acting in the national program of self-managed housing production.
§ The promoting entities must have been legally constituted at least three (3) years before the date of qualification, and their bylaws must include housing provision and/or land regularization, and proof of performance must be provided through the presentation of an activity report that demonstrates the implementation of training activities, mobilization, formulation or execution of housing programs or projects.
§ The qualification of entity is forbidden if:
i – It is pending registration in the Federal Public Sector Informative Registry of Unpaid Credits (CADIN);
ii – it has, within the housing programs, works contracts signed for more than 6 (six) months with works not started, or contracts with works paralyzed for more than 6 (six) months without renegotiation with the Financial Agent, except in cases where the start and the paralysis of the works occurs for reasons not attributable to the ENTITY;
iii – it is registered in the Cadastro de Entidades Privadas Sem Federativos Impedidas (CEPIM); or
iv – it has an irregularity before the Labor Courts;
v – whose executive officers are pending registration with CADIN; and
vi – whether they are themselves, or their respective spouses or partners, as well as relatives in a straight line, collateral or by affinity, up to the second degree, a political agent of the Executive, Legislative, Judiciary or Public Prosecutor’s Office, as well as an officer of a public administration body or entity, of any governmental sphere, public servants or employees linked to the Board of Trustees of the Social Development Fund (CCFDS), the Managing Board of the National Fund for Housing of Social Interest (CGFNHIS) or the MCIDADES.
Art. 7. For the hierarchization and selection of proposals presented by housing associations and cooperatives participating in the program, annual public calls should be made, ensuring a compatible distribution by the housing deficit of each state.
Art. 8. The selection of future residents of the housing developments shall be carried out as established in the internal documents of the development entities, respecting the applicable legal principles and rules and the determinations of the managing council of the public fund from which the resources used for the execution of the development come.
Art. 9. For the implementation of enterprises within the scope of the national program of self-managed housing production, they shall be observed:
I – Location of the land in the urban network or expansion area that meets the requirements established by the Federal Executive Branch and complies with existing municipal legislation;
II – Environmental adequacy of the project;
III – Urban compatibility between the housing development proposal and the surrounding situation.
Subsection II – Resource Sources
Art. 10. For the execution of the National Program of Self-Managed Housing Production, the Union, observing the budgetary and financial availability, may be used:
I – Budgetary resources transferred to the National Fund for Housing of Social Interest dealt with in Law No. 11,124 of June 16, 2005 and the Social Development Fund (FDS) dealt with in Law No. 8,677 of July 13, 1993;
III – Resources forming part of the Severance Premium Reserve Fund dealt with in Law No. 8066 of May 11, 1990.
IV – Other sources of resources.
a. The program will allow the use of more than one source of resources in the composition of housing financing.
b. The resources referred to in items II and III of the caput shall comply with the rules for granting financing approved by its respective Board of Trustees.
c. In implementing the provisions of this Law, the programs established by the multi-year plan and the priorities and goals defined by the budget guidelines laws shall be observed.
Art. 11. State and municipal entities and the Federal District and other federal government agencies may supplement the value of economic subsidies with tax credits, tax benefits, economically measurable goods or services, technical assistance or financial resources.
Art. 12. Participants in the ventures may contribute financial resources, goods or services with the purpose of complementing the public resources of the Program.
The complementary contributions dealt with in the caput shall be approved at a meeting of the participants of the respective undertaking.
Art. 13. The operations carried out under the program are limited to families with monthly per capita income that does not exceed the equivalent of R$1,000.00 (one thousand reais) and conditioned to:
I – A requirement for a financial contribution from the participants, in the form of monthly installments where applicable;
II – Discharge of the operation, in cases of death or permanent disability of the beneficiary, without collection of the beneficiary’s contribution regarding premium and fees, supported by the fund;
III – Coverage of physical damage to the property, without charging a contribution from the beneficiary.
Subsection III – Direct and indirect costs
Art. 14. Direct costs of the program are as follows:
I – Land: the value corresponding to the valuation or acquisition of the land, whichever is lower;
II – Projects: value corresponding to the costs of preparing preliminary studies, projects and obtaining the necessary approvals and licenses to carry out the enterprise;
III – Legal and accounting advisory services: activities performed by specialized professionals under the terms of the respective professional regulations, materialized in studies, opinions, reports, minutes, reports, filling out forms and the like, follow-ups of meetings, hearings and the like;
IV – Housing construction: value corresponding to the costs of labor, services and building materials of housing units with minimum standards of habitability, health and safety defined by municipal postures, and technical performance, according to ABNT standards;
V – Acquisition of Real Estate for Recovery and/or Modification of Use: value corresponding to the cost of acquisition or valuation of used real estate, the lower, plus the costs necessary for the execution of works and services aimed at recovery, occupation and modification of use of the property for housing purposes;
VI – Urbanization and infrastructure: value corresponding to the cost of the works and services necessary to make the building works operative, including water supply; sanitary exhaustion; electric power; public lighting; and access and internal roads in the enterprise area or located in the contiguous polygonal area, with drainage, protection, containment and soil stabilization works also allowed;
VII – Public equipment: value corresponding to the cost of the building works in the common areas of the enterprise aimed at health; education; safety; sport; leisure; urban mobility; community living; generation of work and income; or assistance to children, the elderly, the physically disabled or with special needs or to the head of the family;
VIII – Community equipment;
IX – Units intended for commercial activity: amount corresponding to the production cost of units intended for commercial activity, linked to housing projects in multi-family buildings, including in cases of rehabilitation of urban properties, and the result of its operation shall be fully allocated to the cost of the set, its sale being prohibited;
X – Social technical work: value corresponding to the cost of actions aimed at promoting the development of the beneficiary population, during the pre-work, during the construction and after construction phases, in order to favor the sustainability of the undertaking, by addressing the issues of community mobilization and organization, health and environmental education, and generation of work and income;
XI – Technical advisory services: amount corresponding to the cost of monitoring the execution of the enterprise; and
XII – Work administration: value corresponding to the cost of management of the work, by the promoting entity.
Art. 15. The indirect costs of the program are as follows:
I – Legalization expenses of the land and units: amount corresponding to the expenses with fees, direct taxes and notary fees, essential to the regularization and constitution of the financing, thus specified:
a. Property transfer taxes;
b. Taxes levied on the execution of the object of the financing contract;
d. EO Administration.
Subsection I – General Provisions
Art. 16. Collective Property is the multi-ownership regime applicable to Self-Governing Housing Complexes where the constitutive elements of the property unfold, leaving the faculties to dispose of, and recover in favor of the entity promoting the development and the faculties to use and enjoy in favor of the associates.
§ Collective property shall be governed by the provisions of this Law and, in a supplementary and subsidiary manner, by the provisions of Law 10406 of 10 January 2002 and Federal Law 4 380 of 21 August 1964.
§ Collective property is established by an act between living beings or will, registered with the competent real estate registry office, and the obligations arising from the legal business must be included in such act, without prejudice to others contained in the Condominium Convention and other documents of the enterprise.
Subsection II – The Rights and Obligations of the Member
Art. 17. The rights of the member, without prejudice to those provided for in the instrument of institution and in the condominium agreement when applicable, are to:
I – Use and enjoy the property and its facilities;
II – Participate and vote, as long as it is even with the condominium obligations, in:
a. general assembly of Conjunto Habitacional Autogestionário;
b. the general meeting of the building condominium, where appropriate.
Art. 18. These are obligations of the member, without prejudice to those provided for in the instrument of institution and in the condominium agreement when applicable:
I – Pay the condominium contribution and, when applicable, the building condominium, even if it renounces the use and enjoyment, total or partial, of the property, the common areas or the respective facilities, equipment and furniture;
II – To answer for damages caused to the property, the premises, by you, by any of your companions, guests or agents or by persons authorized by you;
III – Immediately inform the representative of the development entity of defects, breakdowns and defects in the property that competes with them;
V – Keep the property in a state of conservation and cleanliness consistent with its purpose and the nature of its construction;
VI – Use the property, as well as its facilities, according to its destination and nature;
VII – Use the property exclusively for housing purposes;
VIII – To assume responsibility for expenses related to repairs to the property, as well as its facilities.
Subsection III – Transfer of Collective Property
Art. 19. The transfer of the property right regulated in this Section and its effects before third parties shall take place in accordance with civil law, and shall depend on the initiative of the entity promoting the enterprise, without the consent or scientific identification of the other collective owners.
There will be no right of preference in the disposal of the property in favor of the other collective owners.
Art. 20. In housing developments executed within the scope of the national program of self-managed housing production, including in the case of urban real estate requalification, the production of units destined to the commercial activity related to them shall be admitted, in which case the ownership shall be transferred to the promoting entity, and the result of its exploitation shall be fully destined to the costs of maintenance or improvement of the developments.
Art. 21. Contracts and registrations made under this program shall be formalized, preferably, in the name of the woman.
Art. 22. In cases of dissolution of a stable union, separation or divorce, the title of ownership of the property acquired under this program, in the constancy of the marriage or stable union, with subsidies coming from resources of the general budget of the Union, shall be registered in the woman’s name or transferred to her, regardless of the applicable property system.
In cases where there are children of the couple and the custody is exclusively assigned to the husband or partner, the title to the property will be registered in their name or transferred to them.
Art. 23. In the financing operations defined in this law, the form of joint and several guarantees shall be used for the fulfilment of the obligations.
Art. 24. The caput of Article 5 of Federal Law No. 8,677 of July 13, 1993, is now in force with the following wording:
Art. 5. The Board of Trustees of the FDS is created, composed on an equal basis by the representation of the proposing entities, workers and governmental bodies and entities.
Art. 25. Provisions to the contrary, especially Articles 2, 3, 4, 5, 6, 6A of Federal Law No. 8,677/1993 are hereby revoked as far as the Social Development Fund is concerned.
Art. 26. This Law comes into force on the date of its publication.