Document of The World Bank Report No: NCO00003485 NOTE ON CANCELLED OPERATION REPORT (IBRD-79980) ON A LOAN IN THE AMOUNT OF US $40 MILLION TO THE REPUBLIC OF COLOMBIA FOR A NATIONAL MACROPROYECTOS SOCIAL INTEREST PROGRAM PROJECT September 17, 2015 Social, Urban, Rural and Resilience Colombia and Mexico Country Management Unit Latin America and Caribbean Regional Office 1 CURRENCY EQUIVALENTS (Exchange Rate Effective 12/31/2014) Currency Unit = Colombian Peso (COP) 1.00 COP = US$ .00042 US$ 1.00 = 2350.42 COP FISCAL YEAR 2014-2015 ABBREVIATIONS AND ACRONYMS DNP National Planning Department (Departamento Nacional de Planeación) GoC Government of Colombia MAVDT Ministry of Environment, Housing and Territorial Development (Ministerio de Ambiente, Vivienda y Desarrollo Territorial) MBSL Bosques de San Luis Project (Macroproyecto Bosques de San Luis) MHCP Ministry of Finance (Ministerio de Hacienda y Crédito Público) MISN Macroproyectos Social Interest Program (Macroproyectos de Interés Social Nacional) MVCT Ministry of Housing, Cities and Territorial Development (Ministerio de Vivienda Ciudad y Territorio). NDP National Development Plan PAD Project Appraisal Document PDO Project Development Objective PPP Public Private Partnership SIL Specific Investment Loan TA Technical Assistance TTL Task Team Leader VIS Social Interest Housing (Viviendas de Interés Social) VIP Priority Interest Housing (Viviendas de Interés Prioritario) Vice President: Jorge Familiar Calderon Country Director: Gerardo Corrochano Sector Manager: Anna Wellenstein Project Team Leader: Angelica Nuñez Del Campo NCO Team Leader: Angelica Nuñez Del Campo 2 REPUBLIC OF COLOMBIA National Macroproyectos Social Interest Program Project CONTENTS Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Ratings of Program Performance in ISRs 1. Context, Project Development Objectives, and Design .............................................. 6 2. Post-Approval Experience and Reasons for Cancellation .......................................... 8 3. Assessment of Bank Performance ............................................................................ 14 4. Assessment of Borrower Performance...................................................................... 14 5. Lessons Learned........................................................................................................ 15 Annex 1. Bank Lending and Implementation Support/Supervision Processes............. 16 Annex 2. List of Supporting Documents ..................................................................... 18 MAP 3 A. Basic Information CO-National Macroproyectos Social Country: Colombia Project Name: Interest Program Project Project ID: P110671 L/C/TF Number(s): IBRD-79980 NCO Date: 09/14/2015 REPUBLIC OF Lending Instrument: SIL Borrower: COLOMBIA Original Total USD 40.00M Disbursed Amount: USD 0.37M Commitment: Revised Amount: USD 0.37M Environmental Category: B Implementing Agencies: Ministerio de Vivienda Ciudades y Territorio Cofinanciers and Other External Partners: B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: 07/11/2008 Effectiveness: 06/20/2011 06/20/2011 Appraisal: 10/13/2009 Closing: 12/31/2014 12/31/2014 Approval: 01/11/2011 C. Ratings Summary Performance Rating by NCO Outcomes: Not Applicable Risk to Development Outcome: Not Applicable Bank Performance: Unsatisfactory Borrower Performance: Unsatisfactory D. Sector and Theme Codes Original Sector Code (as % of total Bank financing) General transportation sector 17 General water, sanitation and flood protection sector 17 Housing construction 35 4 Housing finance 27 Public administration- Industry and trade 4 Theme Code (as % of total Bank financing) Urban services and housing for the poor 100 E. Bank Staff Positions At NCO At Approval Vice President: Jorge Familiar Calderon Pamela Cox Country Director: Gerardo M. Corrochano Gloria M. Grandolini Practice Anna Wellenstein Guang Zhe Chen Manager/Manager: Project Team Leader: Angelica Nunez del Campo Taimur Samad NCO Team Leader: Angelica Nunez del Campo F. Ratings of Project Performance in ISRs Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 02/19/2011 Satisfactory Satisfactory 0.00 2 11/18/2011 Satisfactory Satisfactory 0.00 3 01/09/2012 Satisfactory Satisfactory 0.00 Moderately Moderately 4 10/03/2012 0.50 Unsatisfactory Unsatisfactory 5 04/24/2013 Unsatisfactory Unsatisfactory 0.50 6 12/01/2013 Unsatisfactory Unsatisfactory 0.50 7 06/30/2014 Unsatisfactory Unsatisfactory 0.50 8 12/23/2014 Unsatisfactory Unsatisfactory 0.50 5 1. Context, Project Development Objectives, and Design Context 1. The National Macroproyectos Social Interest Program Project was a US$40,000,000 loan in support of the Government of Colombia (GoC)’s effort to enable access to affordable housing for low-income beneficiaries. The Board approved the US$40 million Specific Investment Loan (SIL) on January 11, 2011, and the Project became effective in June of that same year. The SIL sought to support the development of an innovative public-private instrument for land and housing development that would enable the development of large affordable housing projects, while maximizing the impact of limited housing subsidy resources. 2. At the time of approval, the housing sector was characterized by a large quantitative and qualitative deficit. According to 2005 census data, the overall housing deficit stood at 3.8 million of which 2.2 million households were in urban areas.1 A highly concentrated developer industry, complex land use and urban planning regulations and lengthy permitting procedures hindered the sector’s ability to meet new demand and widened the existing housing deficit. These obstacles also resulted in a multiplicity of small-scale, uncoordinated housing developments, which lacked the scale to address existing deficits. On the demand side, key constraints identified included limited mortgage finance depth and important implementation challenges to operate the main up-front subsidy program, which led to large undisbursed subsidy amounts per year despite important housing needs. 3. In order to improve access to affordable urban land and housing for low- income beneficiaries the Government adopted the Macroproyectos Social Interest Program (Macroproyectos de Interés Social Nacional – MISN) in 2007 through Decree 42602. The program was intended to address the most important land use and permitting obstacles by allowing the national government to pre-select large sites for land development. The sites (or Subprojects) would later be subdivided into smaller plots and auctioned to private developers for the construction of housing units. Following successful international experiences, the Subprojects would be structured using a Public-Private Partnership (PPP) approach for the provision of urban infrastructure and affordable housing3. 4. In March 2010 the Colombian Constitutional Court declared the legal framework for the MISN program unconstitutional on the grounds that it bypassed 1 An estimated one million of the urban deficit was characterized as quantitative while the remaining 1.2 million households experienced a qualitative deficit related to substandard structures and inadequate access to basic services. 2The program was adopted under Law 1151 and an accompanying regulatory framework under Decree 4260. 3 In a PPP scheme for housing development the role of the private sector goes beyond their traditional role as builder through short-term contracts. PPP schemes allow private consortiums to invest and profit while sharing financing and market risks with the government. 6 municipal authority in land use and urban planning4. The ruling was not retroactive and effectively “grandfathered” 30 Macroproyectos that had already been announced, approved and/or ongoing prior to the issuance of the court ruling (these pre-ruling Subprojects are known as “Macroproyectos de Primera Generación”). In practice, the main consequence of the ruling was to set the pool of potential financeable Subprojects to 30 (the same ones which had been pre-identified in the PAD). Yet, since these were Subprojects were large (8,000 housing units per Subproject on average) the total loan amount could be allocated within the Primera Generación pool. Subprojects approved after the court ruling would need to have authorization from municipalities prior to approval. Project Development Objectives 5. The Project Development Objective (PDO) was to enable access to affordable housing solutions for low-income beneficiaries. The Project planned to achieve the PDO through the financing of the following three components:  Component 1: Low Income Land and Housing Development (US$72.7 million of which US$38 million Bank financed). o Subcomponent 1.1. – Technical Studies and Fiduciary Management (US$3.3 million – Bank financed) o Subcomponent 1.2. – Grants for Low Income Land and Housing Development (US$69.4 million of which US$34.7 million Bank financed).  Component 2: Technical Assistance Program (US$0.5 million - Bank financed)  Component 3: Project Management (US$1.5 million - Bank financed) 6. The PDO was to be monitored with the following key outcome and output indicators: (i) Finance of approximately 10,000 supply-side housing grants for land development and secondary infrastructure associated with small and medium size mixed-use land and housing development Subprojects; (ii) Enable access to affordable housing for approximately 40,000 low-income beneficiaries in project areas; (iii) 100% of selected Subproject sites have access to (a) adequate sanitation, (b) adequate drainage system, and (c) roads with public transport stops at a distance less than 500 m. (iv) Development and implementation of public-private model for mixed land and housing development through: (a) the development of a land trust instrument; and (b) a real estate development model. 4 Specifically the Court found that Article 79 of Law 1151 did not contemplate the municipal authority’s power to regulate their own land, its development and use, and enabled the Government to assume a faculty that was not constitutionally awarded. 7 Design 7. The proposed design followed a framework approach and allowed for three Subproject typologies. Since the pipeline of Subprojects consisted only of “Macroproyectos de Primera Generación” by the time the Project was negotiated, only these were included as eligible for financing in the loan agreement. To select amongst these, the Project followed a framework approach whereby Subprojects, to be eligible for financing, would be screened by the Ministry of Housing (Ministerio de Vivienda Ciudades y Territorio, or MVCT) who was the implementing agency, using technical, financial, economic, environmental and social guidelines summarized in the Project Appraisal Document (PAD). Additionally, the following three typologies were included, which were intended to differentiate the Subprojects according to the role that public and private sector agents played:  Primary Public-Private Model (Subproject I): A public-private land and housing development model under which private developers and/or the local government contributed their land to a trust (Fiducia). The Fiducia would then hire a project- structuring agent to plan and design the selected site’s land use and real estate development. Individual developers would later present proposals and bid for access to public grants for the construction of secondary infrastructure in the mixed- use real estate development projects, which included a minimum percentage of Social and Priority Interest Housing (VIS-VIP).  Alternative Public-Private Model (Subproject II): Applied the same public- private land and housing development principles as outlined in the primary model but allowed the developers to act as structuring agents and builders of the real estate projects (including a minimum percentage of VIS and VIP housing).  Public Housing Model (Subproject III): This model had no private sector participation. The government would provide the land (typically the municipality) and the projects would be developed solely with public funding. This model was only eligible to receive 15 percent of project financing and was intended to support very low income housing, mostly for internally displaced populations. 2. Post-Approval Experience and Reasons for Cancellation 8. Weaknesses in project design, changes in government priorities and implementation arrangements that differed from national systems hindered Project execution and resulted in the cancellation of 85 percent (US$34.2 million) of the loan amount on June 2014, only six months prior to the closing date. The main shortcomings and reasons for cancellation are discussed below. 9. Weakness in Project design. The overall objective of the design – to promote public-private real estate development for affordable housing - was highly innovative and continues to be extremely relevant for Colombia’s housing sector. However, structuring of such projects is always complex and in this case both private and public sector players faced a steep learning curve in terms of the type of agreements, contracts, risks, and responsibilities that each party had to assume. The Public Private Partnership 8 (PPP) proposition was so new that the Project itself - through the technical assistance (TA) component - included financing for the development of a detailed business model and specific documentation to be used solely for the private typology5. 10. A first significant shortcoming of Project design was the rigidity and complexity of the “subproject typology” model. Typically PPP real estate development projects are structured using a third (and independent) party such as the Fiducia which allows flexibility while ring-fencing subproject’s risks. However, the subproject typology included in the project design, increased complexity and reduced the flexibility of the Project (by forcing subprojects to adhere to pre-defined specifications, roles and responsibilities) without adding significant advantages. All typologies received the same benefits (grants for infrastructure provision) and were subject to the same pre-requisites in terms of infrastructure, services and a mix of uses. A simpler public-private model without the three subproject typologies and with flexibility to accommodate the specific roles and responsibilities but with some minimum thresholds on private sector participation would have kept the loan’s innovative aspects while allowing for more flexibility in subproject formulation. Alternatively, the project could have been structured as a phased approach with an inception phase to pilot alternative models prior to defining typologies.6 11. A second significant shortcoming of Project design was the mismatch between the funding instrument and the expected output. The Project’s primary expected output was increased housing through the provision of housing grants, which would finance secondary infrastructure to develop mixed-use real estate developments (subprojects). Funding for these grants would come from FONVIVIENDA; a trust fund mapped to the MVCT responsible for the management and disbursement of up-front grants (or vouchers) for low-income households. These beneficiary household up-front subsidies would be “advanced” by FONVIVIENDA to the Fiducia who would in turn be responsible for project structuring and execution. The system effectively uses a demand side instrument to finance housing supply7raising a sustainability challenge. It represents an implicit supply- side subsidy from the Government to developers, an aspect which was not analyzed or discussed during project preparation. Additionally, it raised operational challenges. For example, under FONVIVIENDA’s operational rules, demand-side subsidies do not need to be procured, rather they are allocated amongst eligible beneficiaries (or in this case “advanced” to the Fiducia in lieu of future eligible households). Yet, under the Project, as these advances were used to finance infrastructure, Bank procurement norms on competitive bidding had to be applied, a process with which Fiducias are not familiar. 12. Finally, Project design underestimated the time needed and difficulties involved in adjusting existing arrangements. For many Subprojects, local governments acted as land contributors and hence expected to play an important role in project 5 The purely “private” typology (known as “ventanilla privada”) was not considered eligible for financing given that its operational mechanism was undefined at the time of loan approval. 6 During preparation the Bank suggested a pilot phase which was not supported by the GoC due to the imperative of reducing the housing deficit. 7 The Fiducia established for each subproject effectively worked as a Special Purpose Vehicle, where project related land and cash were transferred. The municipality, the MVCT and the developer shared responsibility for structuring and developing the subproject. 9 structuring (through the Fiducia). Several of the “Primera Generación” subprojects had already been negotiated or started, so MVCT had to re-negotiate the terms with the private sector and the local governments, which did not always have the willingness or appetite to accommodate Bank procedures, particularly if the funds had already been secured. 13. Administrative changes and a major shift in government priorities. Following Project approval, the Ministry of Environment, Housing and Territorial Affairs (Ministerio de Ambiente, Vivienda y Desarrollo Territorial – MAVDT) was divided into two separate ministries, which caused some administrative delays. More importantly, during that same month (April 2012) the government announced a major shift in policy through the introduction of the 100,000 Viviendas Gratis Program. The Government’s new housing initiative funneled FONVIVIENDA’s resources toward the construction of new public affordable housing developments, which would be allocated for free amongst eligible low- income beneficiaries. The shift away from the proposed public-private housing scheme adopted by the Project into a fully subsidized public housing, dis-incentivized private sector actors from participating in the more complex Macroproyectos scheme, and reduced the relative “attractiveness” of the Project and the Bank’s value added contribution8. 14. Implementation Arrangements. The implementation arrangements set forward in the Project design followed typical SIL implementation arrangements but varied significantly from those designed and used under the Macroproyectos Program. These discrepancies were known from the onset, and mitigation measures were included in Project design (such as preparation of additional MVCT documentation and no-objection steps) to reduce the risk of misalignment between Bank and country systems. Yet these mitigation measures proved ineffective and complicated implementation procedures even further. As many Subprojects had been approved or were under implementation at the time of Project approval, utilizing project funds required modification of the trust fund underlying regulatory instruments. For example, the flow of funds mechanism laid out in the Project design was complex, had encountered problems under previous Bank loans (Loans 7077 and 72819) and differed from the Colombian Macroproyectos implementation mechanism and yet was nonetheless included in the design. Subprojects that were more advanced in preparation, and hence better suited for Bank financing, already had fiduciary agents in place, which therefore could not be selected on a competitive basis as called for in the loan agreement. Another important difference was that the MVCT considered the funds disbursed the moment these were advanced to the Fiducia, (which was typically managed by the Municipalities), while the Bank requires tracking of Project funds until the final output. These inconsistencies required significant adjustments, which were only successfully achieved by the MVCT for one subproject (Bosques de San Luis in Neiva). Despite the Bank’s and Government’s efforts, it was not possible to agree on a solution that would allow the MVCT to offer additional subprojects while complying with the Bank’s requirement of tracking funds until final output. 8 The public housing and the Macroproyectos Programs used the same source of funding (subsidies from FONVIVIENDA), so although these were separate programs in theory, public Macroproyectos could be included – and accounted for - as part of the public housing program. 9 La Guajira Water and Sanitation Infrastructure and Service Management Project and Water Sector Support Project. 10 15. A comprehensive set of risks were identified at appraisal, however their corresponding mitigation actions proved ineffective. The overall risk of the project was considered to be moderate at the time of appraisal. The PAD identifies a set of governance, fiduciary and safeguard risks related to the innovative nature of the project and to the particular implementation arrangements which varied to the Program’s existing procedures. Procurement and financial management risks (rated substantial and moderate respectively) were specifically addressed. However, mitigation measures complicated rather than resolved the issue because they effectively added a set of additional procedures (preparing additional documentation, reforming existing procedures, adding new steps or processes) which further complicated implementation. 16. The Bank and borrower made efforts to disentangle the Project from its stale state, discussing cancellation and restructuring as early as July 2012. Due to the shortcomings discussed above, no financially eligible subproject had been identified by July 2012, a year after project effectiveness.10 Given the change in priorities and the lack of a concrete pipeline of subprojects, the Bank carried out at least three high level missions (led by the Country Director, Sector Director and Program Manager respectively) recommending Project cancellation. After internal discussions, the national government was reluctant to request a cancellation and instead, MHCP and MVCT favored a loan restructuring aimed at bringing the Project design in line with the new post-court ruling legal framework (including Macroproyectos de Segunda Generación), reflecting changes in the new policy priorities (by increasing to 50 percent - from 15 percent - the loan proceeds that could support public housing subprojects), and providing greater flexibility in the flow of funds by allowing funds to be classified as “disbursed” once they were transferred to the Fiducia. After intense dialogue, the Bank and MVCT agreed to a loan restructuring conditioned by the Bank on implementation progress of one Subproject. The MVCT selected the Macroproyecto Bosques de San Luis (MBSL) public Subproject, located in the city of Neiva – which would use the 15 percent allowed by the loan agreement for public subprojects. In addition, the Bank stressed the need to process a restructuring only if other eligible subprojects were identified, in order to avoid returning to a stale state after implementation of the MBSL. 17. A number of restructuring options were evaluated, however the limited budget allocation of the MVCT and the Bank’s sustainability concerns over the new housing programs constrained the available options. 11 The main issues preventing a restructuring were: (i) the FONVIVIENDA budget was allocated primarily to the 100,000 Viviendas Gratis and the recently launched Priority Interest Housing for Savers (Vivienda de Interés Prioritario para Ahorradores - VIPA) programs, leaving only US$5 million of the Ministry’s annual budget eligible for Macroproyectos12 (only the amount needed to 10 The February 2012 supervision mission identified 6 out of a total of 30 subprojects as candidates for financing (including only Macroproyectos de Primera Generación). The main reasons for non-eligibility was that around 17 of the 30 subprojects were considered “private”, a subproject typology that was not included in the Loan Agreement as eligible for financing given that the implementation mechanism was not yet established, while others were excluded because of lack of compliance with environmental, social or fiduciary specifications. However by July of the same year, none of the preparatory work had started (safeguard and technical assessments, for example) for any of the six potential subprojects. 11 For all programs except for the 100,000 Viviendas Gratis 12 Funding from Bank projects is not “additional” to the budget allocated yearly for government programs. The project 11 implement the MBSL), (ii) restructuring the loan to finance the 100,000 Viviendas Gratis public housing program was not considered a viable option because of concerns from the Bank’s technical team over the program’s fiscal and urban sustainability, and because the program was already designed and fully funded, and hence the Bank’s value-added was seen as limited, and finally (iii) limited budget allocation (approximately US$8 million) for other housing and slum upgrading programs, which restricted the possibility to include other activities and utilize the remaining project funds. 18. These constraints impeded the allocation and disbursement of the remaining project funds (US$35 million). Once it became clear that a restructuring was not feasible, the Bank, the Ministry of Finance and the National Planning Department (Departamento Nacional de Planeación – DNP) agreed to a partial cancellation of US$34.2 million (or 85 percent of the loan amount) of the project funds. Under the agreement, MVCT would still implement the MBSL Subproject (equivalent to 15 percent of the loan amount) prior to the closing date (December 2014). Finally, the parties agreed to consider the possibility of a closing date extension to December 2015 if necessary.13 19. Thus, after almost three years of virtually no implementation progress and with an agreement to cancel 85 percent of the loan funds, the Project launched its first procurement process for MBSL. The MVCT hired a dedicated Project team to implement the MBSL (US$5.3 million) as a public housing project (subproject III). MVCT also provided technical assistance to local authorities in order to amend the existing Fiducia regulations to: a) comply with Bank social and environmental safeguards and financial management requirements, b) adjust the MBSL fiduciary operating manual, and c) assist with the preparation of the bidding documents. The procurement process was launched in December 2013, but limited construction time and unattractive returns resulted in the lack of developers’ participation in the bidding process, which was declared void in February 2014. The Bank and Ministry had not anticipated this outcome nor had they discussed next steps if the bidding failed. 20. On April 2014, the GoC requested the Bank the partial cancellation of US$34.2 million from the loan amount and a 12-month extension of the closing date (until December 30, 2015) to allow for implementation of the MBSL subproject. The Bank processed the partial cancellation but, following considerable deliberation, did not approve the Government’s request for a closing date extension given the Project’s poor implementation track record. The Bank was proactively managing the quality of the Colombia portfolio, which was facing difficulties across a number of operations, and considered the Bank's value-added as limited, as the government priorities had shifted. Furthermore, the Bank considered that other products and services could provide a greater can spend/allocate only the amount that has been assigned under the general budget approved by Congress each year. 13 In the November 2013 portfolio review meeting between the Bank, MHCP and DNP there was a discussion regarding five problem projects and the partial cancellation of the Macroproyectos loan for US$34.5 million due to implementation issues and budgetary difficulties. The official request for cancellation, however was not received until April 2014. The possibility of an extension was discussed in this meeting as well. 12 developmental impact than the implementation of the MBSL Subproject. As a result, the Project closed on December 2014 with only one percent of the project funds disbursed.14 21. The decision not to extend the closing date significantly strained the relationship between the Bank and the MVCT. The Ministry considered that the decision not to extend went against previous discussions and did not take into account the possible legal and administrative consequences for the MVCT staff, as the MVCT had already committed the funds to the Municipality of Neiva and the procurement process had been launched (FONVIVIENDA committed US$5.3 million to the Municipality of Neiva and the Municipality, by decree, incorporated these resources into its budget). This effectively implied that the Ministry would have to de-fund another program to honor the commitment.15 22. Only one Project indicator was partially achieved. The Bank provided a significant grant-financed TA (US$325,000) to support the technical, administrative and legal aspects of the innovative PPP housing model supported under the loan. With this support, one of the indicators (development and implementation of public-private model for mixed land and housing development through: (a) the development of a land trust instrument; and (b) a real estate development model) was partially achieved. The TA developed a real estate model and defined and structured a land trust instrument based on a legal assessment of alternatives for pooling public and private land and capital assets. The remaining key project outcome and output indicators including: (i) Financing of approximately 10,000 supply-side housing grants for land development and secondary infrastructure and (ii) Enabling access to affordable housing for approximately 40,000 low- income beneficiaries, and (iii) 100% of selected Subproject sites have access to (a) adequate sanitation, (b) adequate drainage system, and (c) roads with public transport stops at a distance less than 500 m, were not achieved. Nonetheless, without Bank support the GoC has approved 14 Macroproyectos (as of April 30, 2015) with the potential for over 208,326 houses. Of these, around 85,000 have been completed or are under construction. All of these are Subproject II type or developed by the private sector only. Ratings 23. Relevance of Project Objectives: High. The relevance of the project objective is considered high given Colombia’s high housing deficits at the time of the Project, and given that increased access to affordable housing was - and continues to be - an important goal for the Government. 24. Relevance of Project Design: Poor. While the design utilized an innovative approach (a PPP scheme) that is technically sound, the project was over-burdened by rigid 14One percent of project funds were used to hire the dedicated Project team. 15The team was informed that the Superior Audit of Colombia (Contraloría General de la Republica de Colombia) and the Office of the Inspector General (Procuraduría General de Colombia) have opened an investigation because the GoC paid an up-front fee for the loan, which never disbursed. The Superior Audit is evaluating whether there was a misuse of public resources, configuring a “Patrimonial detriment”, while the Office of the Inspector General is evaluating the public conduct of those in authority. If Ministry staff, both current and those employed during the signing of the loan, are found accountable they could face disciplinary actions (suspension from office) and could be liable for a fine. 13 Subproject typologies which proved to be inflexible and by implementation arrangements that varied significantly from country systems without effective mitigation measures. 3. Assessment of Bank Performance Rating: Unsatisfactory Quality at Entry: Unsatisfactory 25. Bank performance in ensuring Quality at Entry is rated Unsatisfactory due to significant shortcomings in technical design and implementation arrangements. Loan design was overly complicated, difficult to operationalize and varied significantly from country systems, making it less attractive for stakeholders relative to other alternatives. Additionally, the Bank failed in adequately assessing the risks and the depth and sustainability of Government commitment to the PPP scheme in the housing sector. Finally, rigidities in the financing instrument did not allow for the flexibility to bring the operation closer to existing country systems. Supervision: Unsatisfactory 26. Quality of supervision is considered to be Unsatisfactory. Although the Bank made substantial efforts to help move the project forward, it failed to resolve design weaknesses and implementation challenges constructively. The Bank’s different view about the project’s direction, which favored cancellation from early on in the project’s life, as well as communication shortcomings between the Bank and the Borrower, delayed a possible restructuring of the project. Partial project results with respect to the MBSL were materialized too late in the project’s lifetime, and were found insufficient, to justify an extension of the closing date. This created a gridlock situation about the project, and strained the relationship between the Bank and the MVCT. 4. Assessment of Borrower Performance Rating: Unsatisfactory 27. Borrower performance is rated Unsatisfactory due to difficulties in proposing a concrete pipeline of viable projects, the lack of adequate budget allocation to implement the project, and in general to the inability to implement, restructure or cancel the Project before the closing date. As the government’s focus shifted away from the PPP scheme embodied in Macroproyectos towards a public housing model, the Project framework became unattractive versus other programs which rely in heavy subsidies. In spite of initial efforts aiming to restructure the project, the lack of timely resolution of implementation issues such as proposing viable projects and budget prioritization impacted borrower performance and weigh on the rating. This also impacted the credibility of the implementing agency and contributed to the Bank’s decision not to extend the Project’s closing date. 14 5. Lessons Learned 28. Project design that uses a framework approach still needs to assess the general feasibility of implementing a pipeline of projects. Detailed and realistic assessments regarding the ability of the implementation agency to comply with both country-specific and Bank requirements for project implementation is essential, and should not be sidestepped under a wholesale or framework approach. The difficulty in finding a Subproject that complied with the loan requirements proved a large obstacle. Once the public housing program (100 mil Viviendas Gratis) was launched, interest from private sector developers in Colombia for the Project dwindled, as the new program essentially offered the same benefits (availability of government subsidies) with fewer requirements. 29. Operations involving PPP schemes require extensive due-diligence, notably an assessment of the government’s long term commitment to foster more complex structured operations, not only because short term initiatives (such as the provision of public housing) turn out to be simpler and crowd-out other initiatives, but because the PPP enabling environment in developing countries is often weak compare to developed countries. 30. The financing instrument selected (SIL) is not appropriate for complex PPP Projects. Rigidities in the financing instrument (SIL, now Investment Project Financing) did not allow the Bank to respond to GoC requests for flexibility, for example in the flow of funds. While some concerns were technical (such as the sustainability of the public housing program), others could have been accommodated through a more flexible financing instrument. Today, the Project could perhaps be structured under a Program for Results (P4R) approach. 31. Stronger dialogue between the Bank and borrower technical counterparts might have eased the decision-making process and avoided a deterioration of the relationship with the GoC on a key Bank agenda. Clear and written communication channels are key among all stakeholders during a Project’s life. As part of strong communication, teams should aim to anticipate possible outcomes (as much as possible) and clarify all agreements in writing to avoid differing expectations. MVCT expressed the view that they were left out of the important decision-making processes, which impacted expectations and resulted in a significant deterioration of the Bank-Ministry relationship. 32. The Bank should carefully assess the implications of denying closing date extensions when procurement commitments have been made by the implementation agencies. The Bank’s decision not to extend the project’s closing date had fiscal, legal and reputational implications which appear not to have been fully understood at the time the decision was taken. This is particularly relevant when budgetary procedures are rigid and Government officials face legal repercussions for Project cancellations. 15 Annex 1. Bank Lending and Implementation Support/Supervision Processes Task Team members Responsibility/ Names Title Unit Specialty Lending Taimur Samad Task Team Leader LCSUW Yoonhee Kim Urban Economist LCSUW Angelica Nunez Urban Specialist LCSUW International Housing Specialist Marja Hock-Smit LCSUW (Consultant) Water and Sanitation Specialist Henry Laino LCSUW (Consultant) Mauricio Cuellar Sr. Transport Specialist LCSTR Estanislao Gacitua-Mario Lead Social Specialist LCSSO Peter F. Cohen Social Specialist LCSSO Juan Carlos Junca Salas Economist (Consultant) LCSUW Juan Miguel Silva Urban Economist (Consultant) LCSUW Camilo Soto Franky Financial Sector Specialist (Consultant) LCSUW Carine Clert Sr. Social Protection Specialist LCSHS Water and Sanitation Specialist Alejandro Meleg LCSUW (Consultant) Camilo Mendoza Transport Specialist (Consultant) LCSUW Ana Maria Aristizabal Environmental Specialist (Consultant) LCSUW Alejandro Rodriguez Urban Specialist (Consultant) LCSUW Clara Gomez Social Specialist (Consultant) LCSUW Glenn S. Morgan Lead Environmental Specialist LCSEN Carlos Vargas Environmental Specialist (Consultant) LCSUW Wilson Casas Environmental Specialist (Consultant) LCSUW Mylena Cardenas Financial Management Specialist LCSFM Jeannette Estupiñán Financial Management Specialist LCSFM Solange Alliali Counsel LEGLA Gabriel Peñaloza Procurement Specialist LCOPR Suzanne Casolaro Social Specialist (Consultant) LCSSO Diomedes Berroa Senior Procurement Coordinator LCSPT Pilar Gonzalez Senior Counsel LEGLA Victor Ordonez Financial Management Specialist LCRPR David Sislen Sector Leader LCSSD Songsi Choi Peer Reviewer SASDU Sameh Wahba Peer Reviewer LCSUW Ana Lucia Barragán Program Assistant LCSUW Karina M. Kashiwamoto Language Program Assistant LCCIC Alexandra Panman Consultant LCSUW Supervision/NCO Angelica Nuñez del Campo Task Team Leader GSURR Santiago Torres Procurement Specialist GGODR Luz A. Zeron Financial Management Specialist GGODR 16 Carine Clert Safeguard Specialist GSPDR Carlos Vargas Bejarano Safeguard Specialist GENDR Clara Hortensia Gomez Safeguard Specialist LCSSO Hernandez Estanislao Gacitua-Mario Safeguard Specialist LCSSO Glenn S. Morgan Safeguard Specialist OPSOR Vanessa Velasco Senior Urban Specialist GSURR Jose Luis Acero Urban Specialist GSURR Jorge Luis Alva-Luperdi Counsel LEGES Natasha Zamecnik Consultant GSURR (b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) Stage of Project Cycle USD Thousands (including No. of staff weeks travel and consultant costs) Lending FY08 13.90 125,715.49 FY09 23.16 194,916.18 FY10 16.30 109,930.18 FY11 3.36 40,048.52 Total: 56.72 470,610.37 Supervision/NCO FY11 4.87 26,403.71 FY12 31.11 174,099.26 FY13 18.48 147,055.82 FY14 24.76 121,313.31 FY15 3.32 25,933.48 FY16 0.50 2,343.80 Total: 83.04 497,059.38 17 Annex 2. Borrowers Implementation Completion and Results Report Antecedentes 1. El Gobierno de Colombia desarrolló y aprobó mediante documento CONPES 3305 de 2004, una propuesta para mejorar la gestión del desarrollo urbano en Colombia, a partir de la definición de un modelo de ciudad que se integraría en las políticas e inversiones de la Nación y el cual estaba acompañado por estrategias que contribuían a desarrollar este modelo. 2. Por lo anterior, el Plan Nacional de Desarrollo 2006-2010, incorporó dentro de los programas integrales de ciudades amables la figura de Macroproyectos de Interés Social Nacional- MISN definidos como: “el conjunto de acciones orientadas a la ejecución de operaciones urbanas integrales, con capacidad de generar impactos en el conjunto de la estructura espacial urbana y regional y de orientar el crecimiento general de las mismas. Los MISN, garantizan la actuación integral del estado conjuntamente con la participación del sector privado para la generación de suelo para Vivienda de Interés Social y la construcción e incorporación de equipamientos e infraestructura de escala regional o nacional en el ordenamiento territorial”. 3. El Plan Nacional de Desarrollo, fue adoptado mediante la Ley 1151 de 2007, cuyo artículo 79 disponía que la estructuración de los Macroproyectos de Interés Social Nacional correspondia principalmente al Gobierno Nacional. La Corte Constitucional en ejercicio de sus funciones revisó el citado artículo 79 y concluyó que las facultades del Gobierno Nacional para definir, formular, adoptar, ejecutar y financiar Macroproyectos desplazaban la competencia que el artículo 313 de la Constitución Nacional otorga a los Concejos Distritales y Municipales en cuanto a la reglamentación de los usos del suelo y la consiguiente adopción, elaboración, revisión y ejecución de los Planes de Ordenamiento Territorial-POTs. 4. Por lo anterior, para la Corte Constitucional el mencionado artículo, permitió el desplazamiento de los preceptos de los POTs por parte de los Macroproyectos, por lo que fue declarado inexequible, no obstante, en la Sentencia C-149 de 2010 dejó en curso los Macroproyectos que se encontraban en alguna de sus etapas; posteriormente, para impedir que los Macroproyectos quedaran sin fundamento legal, el Gobierno Nacional expidió la Ley 1469 de 30 de junio de 2011. 5. De otra parte, en el marco de la estrategia de ciudades amables, mediante Documento CONPES 3625 del 20 de noviembre de 2009, la Nación emitió concepto favorable para contratar empréstitos externos con la Banca Multilateral, hasta por la suma de US$40 millones o su equivalente en otras monedas, con el fin de financiar el “Programa de Macroproyectos de Interés Social Nacional-MISN”, Contrato de Préstamo y problemas para su ejecución 6. El Gobierno Nacional suscribió con el Banco Mundial en marzo 11 de 2011, la operación de crédito por valor de US$ 40 millones para financiar el Programa de Macroproyectos de Interés Social Nacional, el cual se declaró efectivo el 20 de junio de 2011. Posteriormente, en misión realizada del 11 al 22 de julio del mismo año, con el objetivo de participar en el lanzamiento del proyecto MISN, luego de un análisis de la mencionada Ley 1469, el Departamento Nacional de Planeación-DNP, el Ministerio de Hacienda y Crédito Público-MHCP y el Banco Mundial, evaluaron la posibilidad de reestructurar el Préstamo para asegurar que el mismo fuera consistente con el nuevo marco legal definido para los MISN y en esta medida ampliar el ámbito o espectro de aplicación del Programa cofinanciado con recursos del Banco Mundial; sin embargo, para estos propósitos se consideró necesario contar primero con la reglamentación de la nueva ley. 18 7. En forma paralela, se analizó una muestra de subproyectos susceptibles de ser financiados bajo el esquema del Préstamo (que demandaban una inversión que superaba un billón de dólares) entre los que se encontraban:  Nuevas etapas de los proyectos públicos de los municipios de Medellín, Neiva y Pereira.  Nuevas etapas de ejecución bajo modalidad público-privada de los municipios de Barranquilla y Cartagena.  Por la modalidad público privada de los subproyectos de los municipios de Montería y Bucaramanga.  Subproyectos de iniciativa privada en los municipios de Candelaria, Palmira y Mosquera. 8. Sin embargo, una vez realizados los análisis en aspectos sociales, ambientales y viabilidad técnico-financiera, el equipo del Banco Mundial reconoció que algunos de éstos ya contaban con metodologías de ejecución y con características particulares que se tenían que respetar en el contexto del desarrollo futuro de los mismos, aspectos que era necesario garantizar para aprobar el financiamiento de este tipo de proyectos. En el transcurso del año 2011 se hicieron ajustes al Marco de Gestión Ambiental con el fin de incluir las disposiciones legales promulgadas en los años 2009 a 2011, en particular el Decreto 3671 de 2009 y la Resolución 204 de 2011 (que establecían los objetivos y procedimientos para la identificación y determinación, anuncio formulación, adopción, ejecución y financiación de los MINS y se identificaron además, un total de 22 MISN en curso) 9. Posteriormente, en diciembre de 2012, se realizó una nueva misión de supervisión, en la que el MVCT y el MHCP, confirmaron la voluntad de reestructurar el Programa, con el fin de flexibilizar los parámetros para permitir el financiamiento de los Macroproyectos independientemente de la entidad que los promoviera (ente público o privado). El equipo del Banco confirmó su voluntad en otorgar una mayor flexibilización al préstamo a través de una reestructuración y se adquirieron por parte del Ministerio de Vivienda, ciudad y Territorio una serie de compromisos necesarios para iniciar este proceso, relacionados especialmente con la contratación de un equipo especializado de consultores dedicados a la implementación del Programa, mostrar avances en la definición y ejecución de un proyecto de carácter público y el envío al Banco de información sobre macroproyectos susceptibles de financiación, aspectos, que fueron cumplidos. 10. Es importante mencionar que de los análisis técnicos realizados por el Ministerio se identificó que de los macroproyectos de primera generación que se tenían, no existía ninguno que fuera elegible para ser financiado con los recursos del préstamo bajo las modalidades de Tipo I y II (macroproyectos de índole público-privado), ya que no hubo interés del sector privado en el esquema planteado, pues el Préstamo contemplaba básicamente un modelo de contratación semejable a una concesión, bajo el cual un inversionista privado, como resultado de un proceso licitatorio, aportaría recursos de capital para financiar parcialmente la ejecución de obras de urbanismos y construcción de vivienda de interés social en un determinado macroproyecto, en el cual los constructores competirían por un subsidio mínimo a la oferta requerido para entregar y comercializar un número fijo de unidades VIP y un número variable de unidades VIS. Además, la posibilidad de invertir recursos del Préstamo en macroproyectos de índole pública también era limitada, pues sólo se podía destinar el 15% del monto del Préstamo para este tipo de proyectos. 11. El MVCT advirtió que para poder financiar en su totalidad un Macroproyecto de carácter público con recursos provenientes del Préstamo, era necesario modificar la reglamentación que soporta los MISN, para aumentar el porcentaje máximo de subsidios permitidos para los mismos. En este sentido, en el mes de febrero de 2013 el MVCT expidió el Decreto 156 del 06 de febrero de 2013, que permitió incrementar el monto de subsidio por vivienda de 22 a 70 SMMLV, lo que posibilitó invertir recursos adicionales en un Macroproyecto de iniciativa pública. 19 12. De acuerdo con lo anterior, el Ministerio informó en el mes de mayo de 2013 al Banco Mundial que los recursos del Préstamo apropiados en la vigencia 2013 ($10.000 millones), serían destinados básicamente al MISN de carácter público denominado Bosques de San Luis, ubicado en la ciudad de Neiva. Sobre la base de esta decisión se procedió a brindar por parte del Ministerio de Vivienda Ciudad y Territorio todo el apoyo y asistencia técnica a los funcionarios del municipio de Neiva para estructurar los documentos que garantizaran el cumplimiento de las salvaguardas sociales y ambientales, los ajustes al Manual Operativo del Patrimonio Autónomo del MBSL y los Documentos de Licitación correspondientes, todos éstos documentos obtuvieron la No Objeción del Banco Mundial durante el segundo semestre del 2013, con lo que se cumplieron los requisitos técnicos para la asignación de los recursos al Macroproyecto mencionado. 13. Con el aval técnico del Banco Mundial, el Consejo Directivo de Fonvivienda, aprobó la distribución de los recursos para el Macroproyecto de Interés Social Nacional “Bosques de San Luis – Agrupación D” (acta No. 47 del 20 de noviembre de 2013) y mediante Resolución No. 1138 de diciembre de 2013 el Director Ejecutivo del Fondo Nacional de Vivienda-Fonvivienda, asignó en forma definitiva al municipio de Neiva la suma de NUEVE MIL OCHOCIENTOS ONCE MILLONES OCHOCIENTOS CUARENTA MIL NOVENTA Y CUATRO PESOS ($9.811.840.094), como financiación del Gobierno Nacional, proveniente del Préstamo BIRF 7998-CO, al Macroproyecto de Interés Social Nacional “Bosques de San Luis – fase III etapa IV Agrupación D. El municipio de Neiva incorporó en este mismo mes mediante Decreto los recursos a su presupuesto. 14. Con fecha 15 de enero de 2014, previa no objeción del Banco Mundial, se efectuó el llamado a la Licitación Pública Nacional No.001-BIRF-2014. En la fecha prevista para la audiencia de cierre y apertura de propuestas (febrero 20/2014), no se presentó ningún proponente, por lo que se declaró desierto el mencionado proceso. La falta de proponentes se debió especialmente al corto tiempo previsto para la ejecución de las obras y algunas consideraciones técnicas. Reestructuración y Gestiones para obtener una extensión al Contrato de Préstamo 15. Con el fin de iniciar el proceso de reestructuración del Programa, tal como se había acordado en las diferentes misiones realizadas por el Banco Mundial, el Ministerio presentó en la misión de supervisión realizada en el mes de octubre de 2013, los avances en el Macroproyecto Bosques de San Luís-Neiva y una propuesta de reestructuración que incluía: (i) inversión en tres (3) macroproyectos con gran potencial de financiación (Pienta-Santander, La Italia-Valle, Bosques de San Luis); (ii) un proyecto de Planes Integrales de Desarrollo Urbano-PIDU-El Mirador del Fraile-Valle y (iii) apoyo al Programa de Mejoramiento de Barrios que adelanta el MVCT. Sin embargo, el Banco enfatizó que la reestructuración sería viable sólo si garantizaba la asignación presupuestal que cubriera el monto restante a desembolsar. 16. Por lo anterior y teniendo en cuenta que a pesar de los esfuerzos realizados por el MVCT, en la búsqueda de lograr la reestructuración del Préstamo con el fin de flexibilizar su operación, y ante la imposibilidad de contar con un cupo fiscal necesario para avanzar en la reestructuración, la única alternativas que se tuvo fue la de realizar gestiones para solicitar una cancelación parcial y la prórroga de la vigencia del contrato de Préstamo y poder garantizar de esta manera el cumplimiento de los compromisos asumidos con el municipio de Neiva en la construcción de las obras del Macroproyecto Bosques de San Luis, para el cual se habían realizado todos los estudios necesarios y obtenido el concepto favorable del Banco para financiación. 17. Con comunicación del 29 de abril de 2014, el Director General de Crédito Público y Tesoro Nacional, previo concepto favorable del DNP, solicitó al Banco Mundial cancelación parcial de los recursos del Préstamo, garantizando los recursos comprometidos con el municipio de Neiva, y 20 extensión a la fecha de cierre, con el fin de poder reabrir el proceso de licitación para la construcción de las obras de la Agrupación “D” del Macroproyecto Bosques de San Luis. Con comunicación del 4 de junio, el DNP, el MHCP y el MVCT solicitaron a la Gerente del Proyecto en el Banco Mundial su apoyo para agilizar la aprobación a la extensión de la fecha de cierre solicitada por el Gobierno Nacional y una pronta respuesta a la solicitud de no objeción al Documento de Licitación Pública Nacional enviado, para poder reabrir el proceso de licitación respectivo. 18. Con comunicación de junio 11 de 2014, la Dirección Colombia y México – América Latina y Región Caribe del Banco Mundial, manifestó que el Banco aceptaba la cancelación parcial, pero no la extensión a la fecha de cierre solicitada. En respuesta a esta decisión y por la importancia que tiene el proyecto para la región, el Ministro de Vivienda con comunicación del 20 de junio de 2014, insistió en la necesidad de la extensión de la fecha de cierre del Préstamo hasta el 31 de diciembre de 2015 para poder ejecutar las obras del MBSL-Neiva. 19. El 3 de julio de 2014 en teleconferencia realizada en la sede del Banco Mundial en Bogotá, con la participación de funcionarios del Banco Mundial de las oficinas de Washington, México, la Representación en Colombia y funcionarios del MVCT, del DNP y MHCP, se insistió en la necesidad e importancia que tenía para el Gobierno Nacional, la extensión de la fecha de cierre del préstamo para garantizar la ejecución de las obras del MBSL-Neiva y dar cumplimiento a los compromisos sociales generados en la región . 20. El día 17 de julio de 2014 en el despacho del Viceministro de Vivienda se realizó reunión con el Gerente de País del Banco Mundial-Colombia, en la cual se insistió en la necesidad de aprobar por parte del Banco la prórroga del Contrato de Préstamo, para cumplir con el compromiso asumido con el municipio de Neiva y, para poder atender las observaciones de carácter legal que hicieron las entidades de Control fiscal de Colombia (Contraloría General de la República y Procuraduría General de la Nación) a los responsables de la ejecución del Préstamo por su cancelación parcial y por el incumplimiento para con el municipio de Neiva. Además, se insistió en que el MVCT, había cumplido con todos los requerimientos del Banco Mundial en las diferentes misiones realizadas y por tanto, se esperaba una actitud de comprensión y colaboración del mismo para la ejecución de un proyecto social que beneficiaría a cerca de 1.200 personas de población vulnerable que esperan contar con una solución de vivienda digna. Esto, generó desconcierto para el MVCT, pues se esperaba respaldo y concurso del Banco para la ejecución de un proyecto de carácter social de gran impacto para el avance de la política habitacional que se viene implementando en el departamento del Huila. 21. Sin embargo, a pesar de que en el Acta de la Misión de Revisión de Cartera, realizada en el mes de noviembre de 2013, se consideró la necesidad de prorrogar la vigencia del Contrato de Préstamo BIRF 7998-CO hasta diciembre de 2015, con el fin de poder ejecutar las obras del Macroproyecto del municipio de Neiva y, de las ingentes gestiones del Ministerio para lograr la ejecución del proyecto, el Gerente de país del Banco Mundial en Colombia, con carta del 30 de julio de 2014, ratificó su decisión de no aprobar la extensión a la fecha de cierre del Contrato de Préstamo. 22. No obstante lo anterior, el MVCT insistió en buscar alternativas que respaldaran la ejecución de los recursos del préstamo previstos para la financiación de la Agrupación D del MBSL-Neiva, y poder de esta manera cumplir con el compromiso asumido ante la región y su población. En este sentido se optó por presentar la alternativa de “sustitución de inversiones”, utilizada como medio de excepción por la Banca Multilateral, por considerar que era la opción con mayores posibilidades, pues con ésta se cumplía con el fin último del Componente II del Programa - Proyecto de iniciativa pública, que provee vivienda digna a población vulnerable – y, mediante comunicación del 24 de noviembre de 2014, puso a consideración del Banco Mundial la propuesta mencionada, para lo cual se elaboró y envió evaluación expost de tres proyectos ejecutados con 21 normas del derecho privado colombiano: Bosques de San Luis (Agrupación H-I), Programa de vivienda gratuita en Neiva (Agrupación de Vivienda IV Centenario), y MISN Gonzalo Vallejo Restrepo en Pereira (Agrupación de Vivienda Salamanca). 23. Con comunicación del 9 de diciembre de 2014, el Director para Colombia y México del Banco Mundial, manifestó que el proceso de contratación del MBSL - Agrupación H-I, no cumplía con aspectos que deben aplicarse en las normas de contratación de proyectos financiados con el BIRF. Además, los procesos de selección adelantados para la Agrupación IV Centenario-Neiva, y en el MISN Gonzalo Vallejo Restrepo - Pereira (Agrupación de Vivienda Salamanca), no fueron de recibo del especialista en adquisiciones básicamente por incluir el precio como factor de evaluación. Por lo tanto, estos proyectos que contaban con un buen desarrollo técnico-legal y el cumplimiento de exigencias ambientales y sociales no se consideraron como elegibles para el financiamiento a través del Préstamo BIRF 7998-CO. 24. A pesar de los esfuerzos del Ministerio para lograr la aceptación del Banco a las solicitudes presentadas con el fin de extender la fecha de cierre del Contrato de Préstamo y a aceptar un método de excepción para la ejecución de los recursos asignados al municipio de Neiva para el MBSL, fue imposible lograr el desembolso de los recursos del préstamo previstos, para la construcción de las obras del Macroproyecto mencionado. 25. De otra parte, es importante mencionar que no obstante la falta de implementación del Proyecto financiado con recursos del Préstamo, de los 22 macroproyectos identificados en la Resolución 204 de 2011, se adoptaron 14 a diciembre de 2014 y se iniciaron obras en 10 proyectos. El potencial de los macroproyectos adoptados asciende a 208.326 viviendas. De estas, 61.949 han sido iniciadas, 44.202 construidas (14.419 construidas por sector púbico y 29.783 por privados), en ejecución 17.747 y han sido entregadas 38.869. Además, se han asignado 9.569 subsidios asociados al Programa de Macroproyectos. 26. Igualmente, el Gobierno de Colombia viene desarrollando el Programa de 100.000 Viviendas Gratis, a través del cual ha construido 89.138 VIP para cumplir con el compromiso de dotar de una solución de vivienda digna a la población más desprotegida y tiene previsto adelantar en el mediano plazo una segunda fase de este Programa. 22 1