The Role of Swiss Civic Corporations in Land-Use Planning

Environment and Planning A 2011, volume 43, pages 185 ^ 204

doi:10.1068/a43293 The role of Swiss civic corporations in land-use planning

Jean-David Gerber Institute of Land Use Policies and Human Environment (IPTEH), University of Lausanne, 1015 Lausanne, Switzerland; e-mail: [email protected] Ste¨ phane Nahrath, Patrick Csikos University Institute Kurt Bo« sch (IUKB), CP 4176, 1950 Sion 4, Switzerland; e-mail: [email protected], [email protected] Peter Knoepfel Swiss Graduate School of Public Administration (IDHEAP), University of Lausanne, 1015 Lausanne, Switzerland; e-mail: [email protected] Received 11 July 2010; in revised form 23 September 2010

Abstract. Public authorities in charge of managing public real-estate assets at the local level face conflicting interests. In Switzerland, short-term solutions often prevail. This paper looks at another group of actors which are characterized by their long-term real-estate management strategies: civic corporations. In Switzerland old civic corporations, which share many characteristics with common pool resource (CPR) institutions, are large landowners, some of them very powerful, which seem to have been successful in the management of their assets over centuries. The objective of this paper is to address the role played today by large urban civic corporations in the implementation process of land-use planning policies, as well as to understand the conditions of their perpetuation within the complex policy framework characterizing Swiss and European welfare states. This research examines the real-estate strategy of the civic corporations of Bern and Churöie their choice to buy, sell, or lease parcels of land depending on their locationöin order to highlight their complex relationship with local authorities in charge of land-use planning. We show that CPR institutions such as civic corporations must not be dismissed too quickly as relicts of the past: quite the reverse, their strategies gain a renewed significance in a time when public bodies are looking for new ways to improve the sustainability of their spatial footprint and incorporate long-term thinking in their management objectives. More concretely, we show that their significance within land-use planning processes depends on their capacity to complement local authorities through the mobilization of their real-estate assets in order to support the implementation of land-use and urban planning policies.

1 Introduction Public authorities in charge of managing public real assets face conflicting interests. First, the law gives them a clear mandate to implement a whole range of public tasks, including some which necessitate real-estate assets. Second, public budgeting, reflect- ing private sector management practices, calls for a tighter balance between income and expenditure (Barzelay, 2002; Christensen and L×greid, 2006): real assets may be expensive to maintain (especially historical buildings or monuments), but they can also provide a secure source of revenue (leases, rent). In additionöand this issue is very often overlooked by the management literature (eg Ehlers, 1997; Frischmuth, 1998; Po« ll, 2007; Schedler et al, 2006)öpublic real assets can be a particularly useful tool for public bodies to use to influence the spatial development of particular neighborhoods or districts because authorities can count on the combined power given to them by land-use planning regulations and ownership of strategically located plots of land. This field of tensions between the implementation of public tasks, the control of expenditure, and the implementation of spatial development objectives is inherent to the functioning of local authorities. In the past decades different factors have exacer- bated these tensions. One observes in particular a strong pressure to sell public assets, 186 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

which can be linked to the introduction of new accounting rules aimed at importing private sector management principles into the public sector (Harringer, 2004; No« lke and Perry, 2007). On the other hand, local authorities are required to improve the way they steer their spatial development. As awareness that land is a scarce resource rises, there is a need for sustainable land management and planning (OECD, 2001). Land-use planning regulations often do not seem powerful enough to tackle these complex issues alone (Adams et al, 2001; Deng, 2003; Luithlen, 1997). Past experience shows the importance of real assets in creating a friendly environment for individual inhabitants and companies (not to mention the implementation of many legal obligations). Conse- quently, local authorities are caught in a dilemma: either sell real assets whenever possible for cost-efficiency reasons; or keep them because of their strategic importance in the implementation of current and future spatial policies (Kivell and McKay, 1988). Considering this broad context, this paper looks at another group of actors which are characterized by their long-term real-estate management strategies: in Switzerland, old civic corporations (Bu« rgergemeinde in German, or Commune bourgeoise in French; both refer literally to the communities of burghers in the Middle Ages) are large landowners, some of them very powerful, which seem to have been successful in the management of their assets over centuries (Buchmann, 1997; Gerber et al, 2007). Civic corporations are the heirs of a time when town and village communities owned many real assets in common property (in particular, pasturesöso-called Allmende). In the 19th century, when these communities had to give up most of their responsibilities in the organization of the local level of government to newly created political municipalities, the communities were still able to keep their real assets: in this new system, the exercise of political rights is guaranteed to all Swiss citizens, but the right to benefit from the real assets of former communities is reserved for the members of civic corporations. Since then, their main mission has been to manage these real assets. Civic corporations can be regarded as common pool resource (CPR) institutions. Ostrom defines CPR institutions as clearly defined groups of individuals who, while defining a set of rules regulating their use of the resource in accordance with local conditions, create a long-enduring local institutional arrangement capable of monitoring the actions of members vis-a© -vis the resource, resolving conflicts, and administering sanctions to offenders (Ostrom, 1990, page 90). Policy analysts are often victims of the biased view that CPR institutions are a `relic of the past', condemned to disappear in the context of today's policies. This lack of interest is demonstrated by the dearth of studies on the specific role played by this kind of institution in the policy process. This is due to a presumed loss of functionality by such institutions which, in the opinion of the analysts who make this assumption, has two main causes. First, resource appropriators are often less dependent on the local resourceöa factor which decreases the likelihood of the endurance of CPR institutions (Ostrom, 2000). Second, since the 1950s, CPR institutions have began to suffer from competition: either with the welfare state, whose policies have shifted resource- management responsibilities to higher levels of authority, resulting in less leeway for local property-rights holders, in particular CPR institutions; or with the private sector, which is perceived as more efficient. However, recent empirical observations focusing on the regulation processes associated with several natural resources in Switzerland have stressed the importance of CPR institutions, which have survived in many cases, despite the predictions of their inevitable demise (Gerber et al, 2008). In this paper we extend this argument by showing the importance of civic corporations, analyzed as CPR institutions, in the field of real-estate management and planning. The objective is twofold. The first is to understand the role played today by large urban civic corporations in the implementation process of land-use The role of Swiss civic corporations in land-use planning 187

planning policies, and to address the role of these CPR institutions within the complex policy framework characterizing European welfare states and the conditions of their success in terms of wealth, size, political importance, and perpetuation as important landowners, considering that they share the same territory öand some of the same responsibilitiesöas municipal authorities. The second objective is to investigate the way CPR institutions such as civic corporations complement the action of public authorities: more specifically, the delicate balance between the use of civic corporations by political municipalities to pursue the objectives defined by public policies and the necessary autonomy of civic corporations which guarantees their ability to carry out these tasks.

1.1 The civic corporations The organization of the state in Switzerland is characterized by three executive levels: more than 2500 political municipalities (local authorities); the twenty-six cantons; and the Confederation. They work together in a form of `cooperative federalism': ``the completion of federal legislation by the cantons, the implementation of federal programs by cantonal and local authorities, and extensive financeöand revenueö sharing'' (Linder, 1994, page 55). According to the Swiss Federal Constitution, the organization of local bodies, including civic corporations, is in the hands of the cantons; thus, the analyst is faced with as many kinds of municipal organizations as there are cantons. Due to cantonal sovereignty in this matter, the rights and obligations of political municipalities and other public law corporations vary (Carlen, 1988; Geser, 2002). In western cantons where the civic corporations have been eliminated (eg Geneva, Vaud, Neuchaª tel, or Fribourg) or where they have been deprived of some of their original attributes, political municipalities have taken over the tasks previously carried out by civic corporations. In the 18th century, when people started to move more often to other cantons to look for work, it quickly became evident that nonlocals were subject to prejudice in relation to democratic participation, as they were not allowed to vote. These differ- ences in the treatment of the inhabitants of different cantons were first regulated by the Swiss Federal Constitution of 1848 and then by its subsequent revisions. The new constitutional provisions forced the separation of the political municipalities and civic corporations, which was deemed necessary to guarantee the right of all Swiss citizens to vote in the political municipality in which they reside, irrespective of their canton of origin (Swiss Federal Constitution of 1999, Article 39). In Switzerland a clear distinction is made between the political municipality where citizens reside and the political municipality they originate from. The municipality of origin is passed on from parents to children; it is written down in their passport, even if they have never lived in or even seen their municipality of origin (most countries indicate the place of birth instead). If the political municipality of origin also has a civic corporation, the citizens who originate from it are also members of the civic corporation. Consequently, the term `civic corporation' refers to a corporation which gathers all citizens who originate from a place (or who applied to become a member on payment of a fee). In contrast, the political municipality unites all of those residing in its territory, irrespective of the canton to which they `belong'. Traditional tasks of civic corporations consist of securing the management of civic goods and providing social assistance for members in need. In the majority of cantons, civic corporations are no longer authorized to levy taxes; thus, in many cases, they have also relinquished their role as providers of public assistance. Today, their main task consists of managing 188 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

their real assets in a way that does not undermine their capital. Cantonal law gives them a collective responsibility to manage their goods for the long term. Civic corporations often use the proceeds gained from the management of their assets to provide sponsorship for cultural events and subsidiary social care (Moor, 1992). Decision making within civic corporations also depends on cantonal law; however, the basic organization is similar. Within the members' assembly, the supreme organ of the civic corporation, only those domiciled within the corresponding political municipality have voting rights. Members usually meet twice a year; budgets, including all large land deals, have to be approved by the member's assembly. Day-to-day management is carried out by the administration of the civic corporation, which is led by an elected civic council. Despite the significant size of the lands held by the civic corporations, aggregated statistics are not available at the national level (Buchmann, 1997); at the cantonal level, they are equally scarce (but see Closuit, 2004; Solothurner Jahrbuch, 2005). This fact is explained, in part, by the difficulty in categorizing them due to the diversity of their legal status, and the lack of official figures in the mountain territories. However, despite these difficulties, forest statistics are relatively precise: in 2003, 24.3% of Swiss forests belonged to civic corporations (ie 296149 ha), 18.2% to different types of corporations (ie 221534 ha), and 21.4% to the political municipalities (OFS, 2004). In sum, civic corporations are a form of organization whose legal or statutory mission is the management of a common patrimony (Binswanger, 1998). Their experience gained in terms of the management of this patrimony could be used to inform and improve the current debates on long-term and sustainable management of real-estate assets (Marcucci, 2000).

2 Theory 2.1 CPR institutions and the modern state 2.1.1 CPR institutions As mentioned above, CPR institutions are defined as distinct groups of individuals who, while devising a set of rules regulating their use of the resource in accordance with local conditions, create a long-lasting local institutional arrangement capable of monitoring the actions of members vis-a© -vis the resource, resolving conflicts, and administering sanctions to offenders (Ostrom, 1990, page 90). Despite the numerous works analyzing institutions in charge of managing CPR (Berkes et al, 1989; Feeny et al, 1990; Ostrom, 1990; Schlager and Ostrom, 1992; Stevenson, 1991), there are only few examples of studies focusing on CPR institutions which operate within highly industrialized and postindustrialized countries like Switzerland. It seems as though authors have chosen to study CPR institutions in a context where external intervention by both the state and the market is limited. This is problematic in the sense that these studies tend to neglect the politico ^administrative context and have great difficulty taking into account the structuring role played by public policies in industrialized countries characterized by a high degree of codification of their regulations. 2.1.2 Public policy implementation and landowner strategies Following Knoepfel et al (2007, page 24), a public policy is defined as a ``series of intentionally coherent decisions or activities taken or carried out by different publicö and sometimesöprivate actors, ... with a view to resolving in a targeted manner a problem that is politically defined as collective in nature.'' Four different stages of a public policy can be identified (Knoepfel et al, 2007, pages 113f): The role of Swiss civic corporations in land-use planning 189

(1) Agenda setting: the political definition of the public problem is formulated. (2) Programming: the political ^ administrative arrangement (PAA) is defined; it consists of a configuration of public and sometimes private actors who are in charge of implementing a political ^ administrative program (PAP) of a policy, which includes all of the legislative or regulatory decisions taken for the implementation of the policy. (3) Implementation: following the instructions of the PAP, plans of action establishing the priorities for the formulation of policy implementation acts (outputs) are prepared. (4) Evaluation: Many public policies have a spatial impact. As such, they may inter- fere with the underlying order of property rights in the sense that they can restrict landowners' freedom (eg in the name of protection of natural habitats), or they can expand it (eg increased permitted building density). In a country like Switzerland, which is probably similar to the United States in this, property title holders are often able to resist the implementation of public policy because the institution of property is well protected by the national constitution. Consequently, in order to become effective, policy outputs or implementation measures often need to become grounded within the property-right order. Public property has been a traditional means to reach this goal as entering negotiations with private landowners can be avoided. If public property is not implementable, potential landowners' resistance needs to be overcome. Compensation to or contracts with landowners may be an option. The power given to landowners by the strong constitutional protection of their titles allows them to use it to influence the implementation of public policies. Land- owners can resist or encourage the implementation of policies with a spatial impact. In its broadest meaning, a ``real-estate strategy'' refers to the choices made by the landowner to increase the value of its real-asset portfolio. In this paper we focus on one particular expression of this strategy: choices concerning acquisition, sale, or lease of parcels of land, depending on their location, to influence spatial policy implementation (Goodchild and Munton, 1985). Building on Adams and May's (1991) definition, we further differentiate between active strategy, characterized by a deliberate choice to buy, sell, or lease in order to promote (or prevent) development and influence land-use patterns, and passive strategy, where the landowner merely takes action in response to offers or injunctions made by others. In Switzerland the supply of land is not simply a matter for the landowner: it is greatly influenced by local authorities who are in charge of delimiting building land from agricultural land through zoning, as well as enacting building regulations. Local plans are examined for conformity with cantonal master plans and validated by cantonal authorities. As in many other countries, the planning system is a form of public intervention in the development process, in which planning authorities distribute development rights to landowners. 2.1.3 Public action referential Public policies cannot be understood independently from the sociopolitical environment in which they take place. The concept of `public policy referential' builds on the fact that a public policy must be appraised as an important element of the functioning of a political regime, but by no means as an autonomous social process (Jobert and Muller, 1987). The different activities of the state underwent a process of sectorializa- tion through the development of public policies which cut the sociopolitical world into `sectors' (Jobert and Muller, 1987, page 55) organized around specific social or technical problems to which an answer needed to be found. In this context, one of the major functions of public action is not only to solve specific problems but to perform a much more fundamental function which is to maintain social cohesion 190 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

between the different sectors. The implementation of a sectoral public policy implies management of the distortions or discrepancies between the reproduction of a sector and the reproduction of the society as a whole. This process of linking and structuring the relationship between sectors takes place through direct interventions regulating the behavior of actors, but also through an `ideological' process of redefining the mental schemes and collective representations of the actors in the relevant sector. The transformation of actors' mental schemes, which takes place through repeated adjustment processes among sectors, contributes to the justification of the social and political order in force in a political regime. In this context the referential of a public policy refers to the actors' collective representation of a given sector as well as its position and role in the society [Jobert and Muller (1987, page 63); see Nahrath (1999) for a synthetic presentation of the referential approach]. The process of elaborating and imposing a new referential within a sector is called `mediation' by Jobert and Muller (1987, page 71). The actors who contribute to the (re)definition and implementation of a public policy and create its referential are the mediators. The mediators both modify the relationships between the sector and the sociopolitical world and restructure the hierarchy of norms as they redefine the criteria of political intervention in the policy sector. Consequently, policy implementation often implies a transformation of the collective identity, self-perception, and, therefore, behavior of policy target groups in the direction defined by the stated policy objectives. The `mediation process' refers to this translation of policy objectives into collective action.

2.2 Hypothesis We will explore our research questions in the light of the hypothesis that successful civic corporationsö in terms of their political importance in local affairsöowe their success to the fact that they complement public authorities, especially local authorities, in such a way that they can mobilize their real-estate assets to support implementation of the spatial development goals of local authorities (Gerber et al, 2008). To discuss this general hypothesis, we introduce four criteria which address different aspects of the integration of civic corporations in the implementation of planning policy: C1: Mediation process. The role played by civic corporations gains importance from the fact that they constitute a form of social institution which performs what Jobert and Muller (1987) call the `mediation process': that is, the transformation of the collective identity, self-perception, and, therefore, behavior of policy target groupsöin our case, the members of the civic corporations, the users of the real assets (including tenants, lessees, users of the infrastructures, and customers), as well as the partners of civic corporations involved in land management (including political municipalities, large landowners, and developers)öin the direction defined by public policy objectives. In other words, civic corporations assume a function involving the translation or embedding of policy objectives and instruments into the logic of the existing property-rights system. They smooth the process of the transformation of property-rights holders into interested and cooperative policy target groups of environmental and land-use planning policies. C2: Integration in the political ^ administrative arrangement (PAA). One of the main conditions of perpetuation of CPR institutions in the context of modern public action is not their separation from the state, as is often suggested by the literature on the commons but, on the contrary, their enduring integration, together with political The role of Swiss civic corporations in land-use planning 191

municipalities, into the PAA of public policies impacting land uses. This integration depends on the existence of a convergence between the policy objectives and the objectives adopted by the CPR institution. C3: Complementarity between civic corporations and political municipalities. The integration of CPR institutions, such as civic authorities, within the local PAA is facilitated by the fact that civic corporations and political municipalities operate on different but complementary time horizons. New entrepreneurship approaches in the public sector often force political municipalities to privilege short-term over long-term choices (eg `one shot' sales of all assets which are not directly related to the implementation of a public task). Simultaneously, the local democratic process prevents political municipalities from reacting quickly in the land market as public consultations are time consuming. CPR institutions such as civic corporations are more flexible concerning land management. Civic corporations maintain an important stock of real-estate assets in the long term, yet are still able to react quickly if needed. Consequently, they can either mobilize their land reserve or quickly acquire strategically important real assets in order to support political municipalities in their land-use planning effort or to provide suitable parcels for the development of public infrastructure. C4: Room for self-organization in real-estate management. CPR institutions such as civic corporations integrate properly in the PAA if they can complement the action of the political municipality. Consequently, a balance needs to be found between putting the civic corporations into service for the implementation of local public policies and, paradoxically, granting them enough autonomy to accomplish these implementation tasks. Complementarity is only possible if the legal framework clearly specifies the mission of civic corporations to work toward the public interest, while leaving them enough leeway to stimulate their entrepreneurial spirit in order to meet the interests and expectations of their members and ensure their survival.

2.3 Selection of case studies Our research focuses on the conditions and mechanisms of integration of civic corporations, appraised as CPR institutions, in the policy process. All civic corporations manage their real estate according to the constraints and opportunities resulting from the broader development of local municipalities. To illustrate the mechanisms at play better, we selected for in-depth analysis three examples of civic corporations (Bern, Chur, and Solothurn) which are extreme with respect to the size and strategic importance of their real estate (Buchmann, 1997; Carlen, 1988; Closuit, 2004; Geser, 2002; Giacometti, 1996). Extreme cases can potentially reveal more information because more basic mechanisms are activated and more actors come into play (Gerring, 2007). These three cases are expected to provide more pronounced responses to the typical land-management challenges faced by civic corporations today. In order to keep our demonstration concise, we focus in this paper on the two most interesting examples: the civic corporations of Bern and Chur. In each case study, semistructured interviews were conducted in 2007 with the officials in charge of real-estate management. Maps, real-estate statistics, historical information, and documents about the organization and decision-making procedures were collected in order to analyze real-estate strategies in a broader political and sociohistorical context and to document concrete examples of these strategies. 192 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

3 The Civic Corporation of Bern 3.1 Presentation Bern, the Swiss federal capital, is located on the Swiss Plateau in fertile agricultural land. The region around the capital of both Switzerland and the Canton of Bern is quite urbanized. The mission of civic corporations is laid down by the Law on Municipalities of 1998 (RS-BE 170.11) of the Canton of Bern. This specifies that Bernese civic corporations have to perform the tasks that have traditionally been their responsibility and to manage their wealth (Article 112). The law also requires that ``in the management of its wealth and revenues, the civic corporation takes into account the needs of the political municipality'' (Article 114, authors' translation). The Members' Assembly, formed by all 11000 members who have voting rights, is the supreme organ of the Civic Corporation of Bern. The largest part of the income of the Civic Corporation of Bern comes from the profits from the Administration of the Domains. Because the Corporation is no longer entitled to collect taxes, it depends solely on the development of its own resources. However, unlike the Civic Corporation of Chur, the Civic Corporation of Bern has to pay taxes. The Administration of the Domains provides employment for eighteen people corresponding to fifteen full-time positions. The Administration of the Domains manages its own real-estate assets as well as those belonging to other administrations of the Civic Corporation (2006 Annual Report). Its real assets (property) include: agricultural land and parcels in building zones ( 917 ha); parcels with surface rights (which refer to a particular kind of long- term lease providing for the transfer of all the main attributes of a property to the lessee for a period up to 99 years) (179 ha); rental property ( 6 ha); surface areas managed for other administrations (188 ha); and `other' ( 80 ha). The Forestry Administration of the Civic Corporation manages more than 4000 ha of forest, of which it owns more than 85%. A comparison with global figures from 1959 and 1983 (Buchmann, 1997) shows the almost complete stability of the real-estate assets belonging to the Civic Corporation over the last fifty years. The few observable modifications are principally due to internal accounting book entry transfers.

3.2 Real-estate strategy: the case of the Wankdorf district in Bern The Wankdorf district is located to the east of Bern. It was characterized by a strong presence of the military and industry. Due to its strategic location, it is now a booming part of the city. The Civic Corporation of Bern owns a large amount of land in this area (figure 1). The Civic Corporation of Bern runs a very active real-estate strategy. The internal bylaws of the Civic Corporations provide that the activities of the Corporation are funded by the Administration of the Domains: the more profitable the Administra- tion of the Domains, the more the Civic Corporation can extend the scope of its activities. The administration of the Domains is run by real-estate market specialists. They submit proposals to the Small Civic Council, the Great Civic Council, or the Members Assemblyödepending on the cost of the transaction. In order to increase its leeway in the real-estate market, the Civic Corporation recently raised the financial limit above which the Great Civic Council has to consult the Assembly. The Assembly almost always accepts the recommendations of the Great Civic Council. The role of Swiss civic corporations in land-use planning 193

Figure 1. Property of the Civic Corporation of Bern within the perimeter of the master plan of the Wankdorf district in Bern, Switzerland. Three large landownersöthe City of Bern, the Canton of Bern and, to a lesser extent, Armasuisse Real Estates (Swiss Army)öcurrently follow a development strategy that is hardly compatible with the maximal quota of vehicles defined by the Cantonal Master Plan. This is the reason why, contrary to the approach followed in 1996 for the first version of the plan, landowners have been integrated in the negotiation process of the new 2009 Master Plan. In this context, the Civic Corporation of Bern, which owns large parts of the area, plays a pacifying role: many of its parcels' surface rights have been leased to the benefit of third parties and so will not be available in the next decades (Gerber, 2008). (1) New business area; (2) large open areas for the organization of large gatherings; (3) Business Park Bern; (4) future cantonal administrative buildings; (5) Waldau Hospital; (6) cantonal arsenal, to be reassigned; (7) future tramway depot; (8) new railway station; (9) future housing development; (10) stadium (source: Canton of Bern et al, 2009). 194 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

The Civic Corporation clearly aims for high-return objectives, while still being careful not to appear greedy. To achieve this aim it takes advantage of two major assets, which are well illustrated by the case of the Wankdorf: on the one hand, it owns numerous real-estate parcels which are well located in the center and around the City of Bern; on the other hand, it is not pressed for time and can afford to buy cheap parcels today with the certainty that their price will increase in the future. Most of the land owned by the Civic Corporation in the Wankdorf area was bought as agricultural land. Today, the Civic Corporation plays a pacifying role among all the different actors involved in this booming part of the City. The Civic Corporation of Bern often leases the surface rights of its parcels for a certain number of decades, thereby withdrawing them from rushed development or speculation while benefiting from regular income. Reselling a lease is technically possible, but necessitates the approval of the Civic Corporation. As a large landowner with a long-term perspective, the Civic Corporation has been able to run a strategy which reconciles its own interests with public interests. Its strategy being based on long leases has had a damping effect on price fluctuations. Its position as a landowner allows it to promote architectural and town-planning quality, for instance, by securing green areas located within building zones. Also, because of its tight bonds to the City of Bern, it is active in promoting quality of life through its building activities.

4 The Civic Corporation of Chur 4.1 Presentation The City of Chur, the capital of the Canton of Grisons, is located in the Rhine Valley. The Civic Corporation of Chur owns extensive real estate in surrounding alpine political municipalities where farming practices are typical of mountain agriculture. Until 1974 cantonal law had not settled the question of whether there would remain no formal separation between political municipalities and the civic corporations, or if a municipal dualism would be introduced, as is the case in most other cantons (Giacometti, 1996; 1999). In 1974 a new law clarified the issue. It introduced a distinction between so-called ùse goods' (Nutzungsgu« ter) and `civic goods' (Gemeindegu« ter): the Civic Corporation is the formal owner of the ùse goods', such as alpine pastures and forests, and `civic goods' (mostly buildings and pastures), but all profits generated by the use goods must be paid to the political municipality. The Civic Corporation manages the use goods: it can sell or lease them, but the benefit of the sale or lease flows into the coffers of the political municipality. Only the benefits of civic goods remain in the hands of the Corporation. This particular solution can best be understood as the result of a compromise which allowed the preservation of civic corporationsöan institution that some wanted to see disappear. The Civic Corporation of Chur has survived, but at the price of important concessions in favor of the political municipality (Giacometti, 1999). Today, the Civic Corporation of Chur has direct control over only 5% of its real assets (civic goods), while the rest (use goods) benefit the political municipality. Accord- ing to the law of the Canton of Grisons, the Civic Corporation does not have any use rights over its real assets classified as ùse goods', but only over `civic goods'. However, because it retains the authority to make decisions regarding the purchase and leasing of surface rights, it still has the ability to carry out a self-directed real asset strategy. In reality, the Civic Corporation of Chur uses the instruments at its disposal (in particular, surface rights) to accomplish tasks in the public interest. The law regarding local authorities of the Canton of Grisons states that both the political municipalities and the civic corporations will execute the tasks for the well-being of the general public, which are not exclusively within the competence of the canton or the Swiss Confederation. They encourage cultural, social, and economic development (RS-GR 175.050). The role of Swiss civic corporations in land-use planning 195

The Members' Assembly of the Civic Corporation of Chur amounts to almost 4500 members. The Civic Corporation of Chur does not have a specialized administration for the management of real assets.

4.2 Real-estate strategy: the strong presence of the Civic Corporation of Chur in the political municipalities of Chur and Arosa The Civic Corporation of Chur is a powerful corporation which owns a lot of land, not only on the territory of the political municipality of Chur, but also in the political municipality of Arosa (1248 ha in 2006) and other surrounding political municipalities

Figure 2. Property of the Civic Corporation of Chur within the perimeter of the political municipality of Chur. As stipulated by the cantonal legislation, only `civic goods' can be managed freely by the Civic Corporation. The restöwhich amounts to 95% of the surface of its total propertyöis managed for the benefit of the political municipality. This entanglement of responsibilities results in a situation where all residents can take advantage of the large real asset portfolio of the Civic Corporationöthat is, most of the steep land surrounding the city, large parts of the banks of the River Rhine, as well as many historical buildings within the city. 196 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

(1376 ha in total) (2006 Annual Report; Buchmann, 1997). Within the territory of the municipality of Chur (figure 2), real assets have remained relatively stable over time (1644 ha in 1964; 1649 ha in 1985; and 1593 ha in 2006). Losses were almost exclusively caused by the construction of new roads or other public works. The situation is different in the territory of the political municipality of Arosa, of which 30% belongs to the Civic Corporation of Chur. There the Civic Corporation of Chur did not only own forests and pastures but also parcels in development zones. The Civic Corporation of Chur started to buy land in the territory of Arosa in the first half of the 16th century and has gradually increased its holdings. Since the end of the 1930s the region has been used for tourism during winter. The company that operates the ski-hill infrastructure and runs two extremely profitable restaurants located on the hill leases surface rights on `use goods' belonging to the Civic Corporation. Because of the ownership structure (use goods), all of these benefits accrued within the boundaries of the political municipality of Arosa flow into the coffers of the political municipality of Chur. In contrast to the situation in Chur, the Civic Corporation has decided to sell the parcels owned in the development zone of Arosa, renouncing the option of keeping control over these real assets located in another political municipality through the lease of surface rights. In Chur the Civic Corporation collaborates closely with the political municipality. The Civic Corporation either provides land for particular public works, or it acquires real assets for the political municipality as its internal decision-making process is faster than that of the political municipality.

5 Discussion of the hypothesis criteria In this section we discuss the hypothesis in the light of the empirical evidence revealed by the case studies. Table 1 gives a brief overview of the characteristics of the two civic corporations studied. The careful selection of the case studies increases their potential to provide in-depth understanding of the processes identified in the hypothesis, but their explica- tive power is limited by their small number. The results presented in this section represent the first step of an ongoing effort toward a better understanding of the role of CPR institutions, which implies both the theoretical reinforcement of the hypothesis and the extension of its empirical test in the future.

5.1 Mediation process According to the first criterion, C1, we expect that CPR institutions contribute to the process of mediation by translating and embedding policy objectives and instruments into the logic of the existing property-rights system. They do so through a process of redefinition of the collective identity and value system of the property-rights and use-rights holders. Empirical evidence shows that the most active civic corporations are able to affect the belief systems and behaviors of the actors involved in land man- agementöpolitical municipalities, landowners, developers, inhabitantsöby increasing their awareness of policy objectives in favor of sustainable development, long-term planning, and the integration of social and ecological considerations. To be more specific, as the case of the Wankdorf district shows, the most active civic corporations contribute to this mediation process by translating the more or less `technocratic' policy action plans (such as the Wankdorf Master Plan, presented in figure 1), and outputs into the logic of the property-rights and use-rights holders. For example, they translate regulations associated with social and environmental issues through the restructuring of city development projects (eg socially mixed housing development in the Wankdorf district). They translate goals for high-quality planning into concrete development projects: both in Chur and Bern, the civic The role of Swiss civic corporations in land-use planning 197

Table 1. Comparison of the main characteristics of the civic corporations of Bern and Chur.

Bern a Chur b Solothurn c

Surface owned 4925 ha managed by 4217 ha 224 ha and strategic the Administration Few strategically Few or no strategically location of land of the Domains located parcels located parcels parcels d and the Forestry (the Civic Corporation Administration eliminated the Important reserves numerous parcels it of building land and owned in the building strategically located zone of Arosa) parcels Characteristics Active strategy Relatively active Passive strategy (total of real-estate implemented by strategy (but no absence of leeway) strategy a specialized strategic sale) Defence of the status administration Very strong constraints quo Intervention on urban stemming from land-use planning cantonal law Profit-oriented Role in stabilizing the (but without greed) price of land, contri- bution to land-use planning in the resort of Arosa Intervention in land issues for the political municipality Autonomy from A lot of autonomy, Very little autonomy, Little autonomy, due the political made possible by due to strict legislation to the lack of financial municipality significant financial means means Beneficiaries of The Civic Corporation The Civic Corporation The Civic Corporation the assets and takes into account the acts for the wellbeing contributes to social activity of the needs of the political of all inhabitants of the and cultural well-being civic corporations municipality political municipality according to its according to the available means Inasmuch as they law chose to keep this responsibility, Civic Corporations provide welfare to their members a In Bern, the Civic Corporation has an active strategy which makes it one of the most influential actors in land issues of the Swiss capital. b In Chur the very strict legal constraints force the Civic Corporations to cooperate very tightly with the political municipalities, forming a complementary real-estate management structure to the local public authority. c Solothurn is also listed, as an example of a civic corporation without an active real-estate strategy. d A parcel is strategically located if its development has a leverage effect; ie an impact on the appearance, the organization, or the structure surrounding infrastructures. 198 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

corporations promote architectural quality. Civic corporations also translate the objectives of sustainable agriculture and forestry into management measures with long-term considerations. For instance, the inspectors of the Civic Corporation of Chur examine the compliance of the uses of civic goods with regulations or bylaws; in Bern the Civic Corporation produces certified timber. Political municipalities, of course, participate in the process of mediation through their implementation effort. However, as large landowners, civic corporations can take the implementation a step further as they can inscribe policy goals within the structure of property-rights distribution and thus implement them concretely. In the Wankdorf area the role of the Civic Corporation slows down the pace of development through the lease of surface rights in order to avoid land-market overheating or speculation. The position of the Civic Corporation can be considered more precautionary than the position defended by the political municipality, which tends to be more willing to promote economic growth despite forecasts of traffic increases (Gerber, 2008). The civic corporations studied refer to their `tradition' to legitimize their action. This strong bond to `tradition' is central to the way civic corporations define their activities as large landowners. In reality, the `tradition' to which civic corporations refer is made up of habitual social practices which are not fixed; if they were static, they would quickly disappear when incompatible with the more general political and socio- economical context. Therefore, reference to tradition does not imply an immutable strategy but, rather, a consideration of the long term and the absence of quick changes.

5.2 Integration in the political ^ administrative arrangement (PAA) According to the second criterion, C2, one of the main conditions of CPR institutions' perpetuation is their enduring integration, together with political municipalities, into the PAA of public policies impacting land uses. This integration itself depends on the existence of a convergence between the policy objectives and the objectives pursued by the CPR institution. Our case studies show that, by complementing the action of public actors and taking on a unique role, successful civic corporations owe their success to the fact that they have made themselves indispensable for the successful implementation of urban planning policy. One observes a sharing of tasks between political municipalities and civic corporations: political municipalities are responsible for the land-use planning and the allocation of land to different use categories (eg through zoning), while civic corporations often support planning action through their power as landowners and their real estate strategies. This division of power concerning the management of public land seems to guarantee efficiency in land management because the two actors specialize in two tasks which complement each other. As the case of the Civic Corporation of Chur shows, cantonal law plays an important role in defining the complementary role of civic corporations: in the canton of Grisons, the preservation of civic corporations is the result of a compromise where the corporations survived at the price of important concessions in favor of the political municipalities. Today cantonal law requires them to contribute with public actors in the implementation of public interest tasks promoted by various public policies. However, cooperation between political municipalities and civic corporations has not always been easy: particularly difficult were the days immediately after their separation because they had to go through the contentious process of determining their respective areas of jurisdiction. Due to their exclusivity, powerful civic corporations, such as that of Bern, tended to behave as `states within the state', raising issues of democratic control. The existence of tensions between the Civic Corporation and the political municipality is understandable since, within the perimeter of the city, the majority of the reserves of The role of Swiss civic corporations in land-use planning 199

building land belong to the Civic Corporation. This situation gives the corporation an important political weight concerning the development of the city itself, as is shown by the example of the fast-growing district of Wankdorf. Cantonal law had to break their resistance: as `clubs', civic corporations could only survive because of the drastic public policy interventions which forced them to open to `foreign people' and to manage their real assets in a way which takes into account the development interests of political municipalities. Unlike Ostrom's typical CPR institutions, civic corporations are not purely self-organized and property-rights-based but are regulated by a clear public policy component which forces them to integrate in the PAA. Today, both in Bern and Chur, collaboration is fairly strong. It has allowed the development of strategies based on real assets which benefit the whole local popula- tion: for example, maintenance of historical monuments, provision of parcels of land and buildings for public tasks (green zones and parks, a cemetery, buildings for the political municipalities, etc), welfare issues, and cultural initiatives.

5.3 Complementarity between civic corporations and political municipalities According to the third criterion, C3, because of their long-term approach, CPR institutions such as civic corporations usefully complement political municipalities in spatial development issues. Civic corporations are in charge of the management of a resourceöland propertyöin a time horizon which is different from that of political municipalities. Civic corporations maintain their stock of real assets over the long term while still being able to react quickly in land markets. Consequently, they can mobilize their land reserve to support political municipalities in land-use planning or to provide suitable parcels for the development of public infrastructure. In order to allow civic corporations to maintain their real assets in the long run and support their tradition-driven strategy and related moral obligation, cantonal lawmakers have made them relatively independent from short-term restrictive financial constraints. This characteristic fundamentally distinguishes civic corporations from other actors active on the real-estate market, including political municipalities, which are sensitive to shifting political majorities. Civic corporations benefit from a resource that the majority of their market-driven competitors do not have: time. Civic corporations can allow themselves a `wait-and- see' strategy. The Civic Corporation of Bern, for instance, has time to wait for its agricultural land to be transferred into building zones, and it has the time to wait for favorable circumstances (collaborations, political support of actual legislature, economical context, etc) to carry out new projects. Real estate located in the agricultural zone always had a great significance for the Civic Corporation of Bern as it is at the heart of its long-term strategy: 90% of the built area that it owns today was initially agricultural land. The Civic Corporation has always privileged the purchase of relatively cheap agricultural land located around built zones. Conversely, it does not buy expensive land. Today the scope of this strategy is somewhat reduced due to legal restrictions on the purchase of agricultural land by nonfarmers; however, the Civic Corporation can benefit from special exemptions if the purchases increase the viability of its existing farming enterprises. CPR institutions such as civic corporations are forms of organizations which simultaneously take advantage both of the long-term nature of property rights and of the always-changing nature of public policies, which may enhance the value of their real assets. The civic corporations' widespread use of surface-rights leases is the embodiment of this strategy. These instruments are useful to civic corporations because they help bridge the gap between the very different timelines of the various rights and policies which affect real assets. For example, local land-use plans, which greatly 200 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

impact the value of plots of land, are updated every fifteen to twenty years whereas the amortization of a building is often calculated over more than five decades. From this perspective, measuring the return of real assets on a yearly basis is a short-sighted strategy, considering the longer time scale in which the broader legal, political, economic, or social context of the parcel evolves. Real assets need to be managed at a different temporal scale than public policies. Civic corporations and political municipalities are two kinds of actors working for the general interest; they supplement each other because the time horizons of their strategies are different and complementary. It is worth noting, as suggested in the example of the Wankdorf district, that today the distinction between political municipalities acting as planning authorities and civic corporations using their real assets to support that planning is being blurred by the fact that, as a consequence of the introduction of new managerial standards in the public sector, political municipalities now tend to manage their real assets more like the private sector. While the real estate and land-use planning administrations of political municipalities used to work hand in hand, their collaboration is increasingly torn apart by incompatible incentives (profit generating versus planning). Consequently, the role played by civic corporations, which are legally forced to adopt a long-term perspective, might become even more important in the future. They may indeed replace the role that municipal real-estate administrations might have played in the past.

5.4 Self-organizing in real-estate management According to the fourth criterion, C4, the proper integration of CPR institutions within the PAA is possible only if the right balance can be found between putting CPR institutions into service for the implementation of local public policies and granting them enough autonomy to accomplish these implementation tasks. Remaining an active landowner capable of initiative requires the development of particular skills and resources. The case of Chur shows that one of the major conditions of having an active real-estate strategy is the ability to react quickly in the real-estate market. The political municipality of Chur has understood this issue well and, thus, calls in the Civic Corporation to buy the parcels that it is interested in but cannot acquire because of the slow pace of democratic processes. When the political municipality of Chur requests collaboration from the Civic Corporation in real-estate issues, the Corporation does not hesitate to respond. The Civic Corporation can make parcels of land available to the municipality for the construction of local public infrastructure through surface rights, sales, or exchanges. But it can also purchase parcels or buildings at the request of the municipality, as the decision processes of the Civic Corporation are much faster than the democratic process at the local political level. Consequently, it appears that the land strategy of the Civic Corporation of Chur is fully complementary with that of the political municipality because the Corporation has the ability to provide autonomous responses in domains where the political municipality's leeway is restricted. Civic corporations manage their assets for the benefit of their members and, more or less directly, for the general public. Courts have confirmed several times that these `clubs' are legally not allowed to refuse new members; however, the price to be paid to become a member can be expensive. To some extent, even if it occurs by roundabout means, exclusiveness has not completely disappeared. Adhesion to a civic corporation is not only a matter of paying an entry fee: it also implies the acknowledgement of the long tradition of a particular corporation and a process of identification with its core values, history, and goals (mediation process). In contrast to this reality, a political municipality works like any administration providing services to the people residing The role of Swiss civic corporations in land-use planning 201

in its territory. The most obvious consequence of the similarities between a civic corporation and a club can be seen in the political composition of the managing organs. The civic corporations studied are run generally, or even exclusively, by officials belonging to political parties with comparable agendas (which happen to be conservative). Civic councils are not political arenas, but they are a meeting place for people with similar convictions. This characteristic has the advantage of facilitating the decision- making process because individual or partisan political strategies do not inflame the discussions. At the same time, it also creates the risk of functioning in isolation: novelty usually arises from debating conflicting ideas. Civic corporations are specialized bodies; their main task is the management of their real assets. Their social and economic interests are more or less homogenous. By contrast, political municipalities have to manage a broad spectrum of collective goods and services, whose heterogeneity often leads to competing or conflicting goals and priorities. The potential for collaboration between civic corporations and political municipalities appears to depend on the independent coexistence of these two different bodies which work according to different rules, but still closely complement each other.

6 Conclusion In this paper we have shown that CPR institutions such as civic corporations cannot be dismissed as relicts of the past too quickly. PAAs involving civic corporations show many potentials in the implementation of spatial development policies. For political municipalities, part of the advantage of working with civic corporations is related to the fact that civic corporations do not try to imitate private real asset management. As public law institutions, their main legal advantage is their ability to avoid the end- of-year balance sheet pressure to some extent. As Polanyi (1957) observed, land is not an ordinary commodity: it is the basis of life. The preservation of a real-estate patrimony is the root of civic corporations' existence because it is the condition for their survival as CPR institutions. This fundamental principle has appeared in another context regarding risks of shortage in agricultural production, but it finds an echo in today's scarcity of land. Civic corporations do not sell land because it is too precious to be sold. Instead they use other legal tools, such as surface rights, which allow them to give away their landownership right, but only temporarily. Consequently, these CPR institutions become an ideal partner of political municipalities for all long-term real-estate issuesöa status that the municipal real-estate administration has lost. Their nonconfrontational internal decision-making structure also makes them reliable partners in land deals of general interest, whereas local politics can considerably slow down decision making within political municipalities. Close collaboration with civic corporations not only allows real-asset management to be depoliticized, it also makes it possible for political municipalities to count on a partner to keep their own balance sheet `clean' from unwanted physical fixed assets while still securing the future of important public land assets. It also gives political municipalities the flexibility to influence land-use planning with the strategic real assets belonging to the civic corporations beyond their own yearly final statements. Counterintuitively, we have shown that collaboration among the different political and administrative organs of political municipalities cannot avoid or mitigate the problem of incompatible incentives, yet outside collaboration with CPR institutions appears to be effective. The implication of this research for local authorities is that, as neoliberal incentives no longer make the distinction between the management of real estate and that of other resources, the collaboration with external structures, whose legal organization gives them a long-term perspective, becomes more important for local authorities. 202 J-D Gerber, S Nahrath, P Csikos, P Knoepfel

Comparable solutions implying a close collaboration between public authorities and a separate entity offering its real assets to support the implementation of public policies and promote tasks of public interest have been implemented elsewhere. These solutions are commonly used for the preservation of open space and historical or ecological assets. While different models have been developed in continental Europe, involving entities such as foundations, which rely to diverse degrees on public money, these solutions have found even greater support in common-law countries. The number of land trusts has soared in recent decades in the United States (Fairfax et al, 2005), as they have been taking over numerous tasks which had been abandoned by public authorities following a general roll-back of the state (McCarthy, 2005). The fact that these private organizations benefit from important public subsidies which encourage their acquisition projects raises issues of democratic control and accountability (Morris, 2008). Within this broader framework involving the delegation of public tasks to private organizations, we insist on the potential of CPR institutions. We have pointed out how local public authorities and CPR institutions can collaborate. CPR institutions are organizations which are neither public, nor private; they are community institutions. The particular constraints characterizing their decision-making procedures, controlled by precise regulations, lead to strategies which are able to take into account the collective interest. CPR institutions such as civic corporations must not be dismissed as relicts of the past too quickly; quite the reverse: their strategies gain renewed significance in a time when public bodies look for new ways to improve the sustainability of their spatial footprint and incorporate long-term thinking in their management objectives. Acknowledgements. The authors thank the Civic Corporations of Bern, Chur, and Solothurn which kindly agreed to answer our questions and to give us access to their internal reports. Many thanks also to three anonymous reviewers for their constructive comments. Thank you also to Kayje Booker who kindly agreed to edit the text of this article. This paper is an output of a project funded by the Swiss National Science Foundation (grant 100012-107833). References Adams C D, May H G, 1991, `Àctive and passive behaviour in land ownership'' Urban Studies 28 687 ^ 705 Adams D, Disberry A, Hutchison N, Munjoma T, 2001, `Òwnership constraints to brownfield redevelopment'' Environment and Planning A 33 453^477 Barzelay M, 2002, `Òrigins of the new public management. An international view from public administration/political science'', in New Public Management, Current Trends and Future Prospects Eds K McLaughlin, S P Osborne, E Ferlie (Routledge, London) pp 15 ^ 33 Berkes F, Feeny D, McCay B J, Acheson J M, 1989, ``The benefits of the Commons'' Nature 340 91^93 Binswanger H C, 1998, ``Dominium und Patrimonium. Eigentumsrechte und -pflichten unter dem Aspekt der Nachhaltigkeit'', in Eigentumsrechte verpflichten: Individuum, Gesellschaft und die Institution Eigentum Eds M Held, H G Nutzinger (Campus, Frankfurt am Main) pp 126 ^ 142 Buchmann W,1997 Schweizer Bu« rgergemeinden als Landschafts-Aktoren: ihr Grundeigentum und dessen aktuelle Entwicklung am Beispiel von Bern, Chur und Solothurn Department of Geography, University of Basel Canton of Bern, City of Bern, Ittigen, Ostermundigen, Civic Corporation of Bern, BEA Bern Expo, Federal Department of Defence Civil Protection and Sport, SBB, 2009 ESP Wankdorf Master Plan, Bern Carlen L, 1988, ``Die Bu« rgergemeinde in der Schweiz gestern, heute, morgen'', presented at 44 Generalversammlung des Schweizerischen Verbandes der Bu« rgergemeinden und Korporationen, 6 May, Liestal; copy available from Universita« tsverlag, Freiburg Christensen T, L×greid P, 2006, `Àgentification and regulatory reform'', in Autonomy and Regulation: Coping with Agencies in the Modern State Eds T Christensen, P La×greid (Edward Elgar, Cheltenham, Glos) pp 8 ^ 49 The role of Swiss civic corporations in land-use planning 203

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