A Legal Butterfly Effect: Unexpected Twists and Turns of the Law in Costa Rica’s Payment for Ecosystem Services Program

7212019 A Legal Butterfly Effect Unexpected Twists and Turns of the Law in Costa Ricarsquos Payment for Ecosystem Services hellip

httpslidepdfcomreaderfulla-legal-butterfly-effect-unexpected-twists-and-turns-of-the-law-in-costa-ricas 121

A Legal Butterfly Effect UnexpectedTwists and Turns of the Law in Costa

Ricarsquos Payment for Ecosystem ServicesProgram

Pablo G Pentildea

Abstract Costa Ricarsquos Payment for Ecosystem Services program (PES) is one of

the most studied exercises of its kind but closer examination of the programrsquos legal

framework and governance is still lacking The PES did not occur on a vacuumlaws and policies outside the boundaries of the PESrsquo regulations shape the way it

evolved and functions The supervisory checks and balances of the forestry regency

system the public funds laws that reduced the programrsquos flexibility and the

administrative simpli1047297cation process across the Costa Rican government are all

examples of policies outside the PES that strongly influence its functioning Foreign

policies also shaped the PES For example the World Bank-sponsored structural

changes of the Costa Rican economy during the 1980rsquos helped shift the rationale

from forest subsidies to payments for ecosystem services In addition a closer look

at the PES on the ground provides interesting opportunities to reflect on the effectsof this legal framework For example the way violations to forest laws occur and

are dealt with by judges and PES of 1047297cials most likely had an effect on the Costa

Rican forest cover which is missed in studies focused on the additionality of the

program Ultimately however people implement the PES and this paper suggests

an interesting dynamic between two types of bureaucrats at the program the

lsquotechniciansrsquo and the lsquolawyersrsquo The lsquolawyersrsquo seem to have displaced the lsquotech-

niciansrsquo in a process of lsquorendering legalrsquo nature which has conflicting implications

for the PES effectiveness All these dynamics may suggest a legal lsquobutter fly effect rsquo

that policy-makers ought to be aware of when designing and implementing envi-ronmental institutions and mechanisms

Keywords Payment for ecosystem services Forest governance Environmental

law REDD+ Costa Rica

PG Pentildea (amp)

Environmental Law and Policy Specialist Peruvian Society for Environmental Law

Lima Peru

e-mail ppenaspdaorgpe

PG Pentildea

School of Forestry and Environmental Studies Yale University New Haven USA

copy Springer International Publishing Switzerland 2016

V Mauerhofer (ed) Legal Aspects of Sustainable Development

DOI 101007978-3-319-26021-1_16

305



1 Introduction

Costa Rica has a rich history of regulating and experimenting with different

incentives for forestry activities and more recently for forest conservation throughthe well-known Payment for Ecosystem Services Program (PES) According to the

Forestry Act of 1996 the Costa Rican PES pays landowners for a bundle of four

ecosystem services provided by their forests CO2 1047297xation and sequestration water

conservation biodiversity protection and scenic beauty FONAFIFO (Fondo

National De Financiamiento Forestal) is the institution entrusted with managing the

PES As of 2012 FONAFIFO had awarded 11378 payment for ecosystem services

contracts in different categories more than 4500 of those are currently in force

(FONAFIFO 2012a b)

Despite the publicity the PESrsquo ef 1047297cacy in restoring Costa Ricarsquos forests remains

a contested issue but there are interesting opportunities to improve our under-

standing of the programrsquos governance Costa Ricarsquos PES is considered the 1047297rst

major payment for ecosystem services grand scheme exercise in the world and as

such it is one of the most studied (Arraigada et al 2012 Daniels et al 2010

Fletcher and Breitling 2012) However the bulk of previous research has focused

mainly on the programrsquos effectiveness to curb deforestation or help poor 1047297nqueros

(farmers) (Fletcher and Breitling 2012) Thus some scholars have been advocating

for additional research that focuses on explaining the context in which the PES

developed and is governed to better understand the programrsquos current and potential

impacts (Daniels et al 2010 Fletcher and Breitling 2012) This paper aims tobridge that gap and to provide a better contextual understanding of how Costa

Ricarsquos PES operates within the speci1047297c set of rules and institutions that govern it in

particular from the perspective of those who administer it on a daily basis In doing

so I offer some insights into the role of law in the PES and the way it functions on

the ground

2 Methods

I did 1047297eld research in Costa Rica between May and July 2012 During this time I

conducted interviews with key informants engaged in participant observation

during 1047297eld visits and conducted legal research In total I conducted 18

semi-structured interviews of 30 min to an hour In addition I held casual con-

versations on the 1047297eld with many of them during longer periods With the help of an

informant in San Joseacute head of an international NGO I prepared a list of potential

informants that had diverse experience with the PES and added others recom-

mended by some interviewees The 18 interviewees comprised mainly current andpast government of 1047297cials from the Ministry of the Environment (MINAET)

FONAFIFO and the Sistema Nacional de Areas de Conservacioacuten (SINAC) as well

as conservation NGO workers representatives from the Colegio de Ingenieros

306 PG Pentildea



Agr oacutenomos and some prospective and current bene1047297ciaries The semi-structured

interviews focused on the informantsrsquo perception of the PES and FONAFIFO as an

institution and included questions on how they thought it could be improved or

adjusted In some cases depending on the expertise of the interviewee questions

centred on legal matters of the PES in order to understand the legal framework that regulates it and the perceptions these different interviewees had on their ef 1047297cacy at

different stages Oral information on the purpose of the interview and research were

provided in accordance with human research protection standards

I visited two implementation areas Limoacuten (E Costa Rica) and Sarapiquiacute (N

Costa Rica) to do participant observation and conduct interviews In Limoacuten I

accompanied NGO workers in 1047297eld visits to current and prospective PES bene1047297-

ciaries and their 1047297ncas (farms) In Sarapiquiacute I joined government of 1047297cials in a

supervision visit to a PES 1047297nca The 1047297eld visits and the time spent with these

informants provided insights into the nature of the PES work on the ground and itsrelationship to the law and policies that support it

3 Literature Review

Costa Ricarsquos PES is in part a product of a new paradigm in conservation where

market-based tools are regarded as key to achieving ef 1047297cient and sustainable forest

protection Throughout the history of the conservation movement academics andpractitioners have advocated and used tools based on shifting paradigms The idea

of lsquofortress conservationrsquo behind the creation of the Yellowstone National Park in

the United States for example was in vogue during the beginning of the move-

ment followed by the integrated conservation and development projects (ICDPs)

and soon after by a critique of those who acknowledged the existence of trade-offs

and the move towards using market incentives such as PES to drive conservation

(Adams and Hutton 2007 Wells and Brandon 1992 Robinson and Redford 2004

Wells et al 2004 Wunder 2005 McShane et al 2011) Costa Ricarsquos PESP is a

prime example of a policy intervention that although led by the State aspires at being driven by ecosystem services markets

The PES has been subject to abundant analysis particularly on the question of its

additionality Studies on the ef 1047297cacy of the PES have focused on understanding to

what extent the programme has been responsible to curb deforestation in the country

(Saacutenchez-Azofeifa et al 2007 Pagiola 2008 Daniels et al 2010 Arraigada et al

2012 Plaff et al 2008 Morse et al 2009 Sierra and Russman 2006 Wunder 2007)

Most of these studies rely on complex economic and statistical models and the

majority of them have found that the PES has had no additional impact on slowing

down the countryrsquos deforestation rate although the subject remains highly contested

(Daniels et al 2010 Arraigada et al 2012) For example in a recent study Arraigada

et al found that unlike prior studies in 1047297ncas under the PES in the Sarapiquiacute region

lsquothere was a net increase in total forest cover rsquo compared to those not in the program

A Legal Butter fly Effect Unexpected Twists and Turns hellip 307



thus signalling a modest impact of the PES on the forest (2012 p 393) However the

authors explain that it is dif 1047297cult to determine whether this difference is a result of

forest regrowth or avoided deforestation (Arraigada et al 2012)

Another focus of attention has been the social impact of the PES Many have

pointed out that the legal requirement to have a land title is a major barrier to accessto the bene1047297ts of the PES (Camacho et al 2000 Pagiola 2002 2008) This criterion

seems to have resulted in more 1047297ncas under PES owned by better-off 1047297nqueros than

by their poorest counterparts (Zbinden and Lee 2005 Pagiola 2008) Moreover

laws regulating the use of public funds barred the government from using those

funds to pay landholders without clear titles thus restricting the access of the

poorest 1047297nqueros to the bene1047297ts of the PES (Pagiola 2008) Congress later approved

legislation clarifying this situation and allowing FONAFIFO to sign up some

informal landholders into the PES Also the government put forth ingenious

schemes in protected areas such as the Osa peninsula allowing landholders without titles to enter the program FONAFIFO enlisted the Institucioacuten de Desarrollo

Forestal (IDA) as these informal landholdersrsquo proxy with whom FONAFIFO

of 1047297cially signed the PES contract (Castro Salazar and Pentildea Chacoacuten 2011)

Transaction costs involved in applying and maintaining 1047297ncas in the PES may

prove an additional barrier to entry for the poor (Pagiola 2008) This was especially

true in the early years of the PES since then FONAFIFO has worked on decen-

tralizing its operations making the program more widely known and making the

procedures simpler and less time-consuming for applicants (FONAFIFO 2005

Pagiola 2008) Finally another constraint for the poor in the original setup of theprogram was its lack of focus on deprived regions or on activities regarded as more

economically bene1047297cial like agroforestry (Cole 2010 FONAFIFO 2005)

FONAFIFO has changed its policy and currently allows 1047297ncas under agroforestry

systems into the PES FONAFIFO awarded the 1047297rst agroforestry PES contracts in

2003 and the time of the research they amounted to more than 4000 ha

(FONAFIFO 2012a) There has also been a change in regards to the geographical

focus of the program The PES Procedural Manual (Government of Costa Rica

2009) now states in article 227 that 1047297ncas located in districts with a social

development index of less than 40 are a priorityAcademics have not similarly focused on analysing the PESrsquos governance but

there have been some interesting studies that provide a 1047297rst look at how the legal

framework of the PES mdash the governance backbone mdash works and how it operates on

the ground Early work by Pentildea Chacoacuten (2004 2006) described the basic legal

features supporting the PES More recently Takacs (2009) explained the legal basis

for Costa Ricarsquos allocation of carbon rights to 1047297nqueros (farmers) which used a

rather simple rule that whoever owns the land owns the carbon rights and other

rights related to the ecosystem services provided by that land Castro Salazar and

Pentildea Chacoacuten (2011) review the overall legal framework structure of the PES

concluding that countries that wish to replicate Costa Ricarsquos PES need a strong

regulations and a specialized agency such as FONAFIFO An interesting research

by Le Coq et al (2010) applies a policy process perspective to the PES and

308 PG Pentildea



manages to provide an inner look at the politics and history behind its creation and

development Fletcher and Breitling (2012) make an effort to explain the PES

governance concluding that despite its market-based intent the program remains a

subsidy policy Finally Daniels et al (2010) provide examples of how an improved

and contextual understanding of the PES governance helps better frame its resultsThe present research builds on these past studies in order to move the conversation

on the broader context of the PES forward particularly from a legal and policy

point of view

4 Governance of the PES on the Ground

41 Applying to the PES A Functional Sieve

As a state-led program FONAFIFO relies on its bureaucracy and of 1047297cial proce-

dures to run the PES The Forestry Act of 1996 its regulations and its Procedural

Manual provide the basic legal framework for this The procedure starts with the

application which has come a long way since the program began in 1997 An

informant from FONAFIFOrsquos main of 1047297ce in San Joseacute a lawyer said that before

the application process took lsquoa long timersquo but now it only takes around 1 and a half

months and lsquobetween 6 and 7 months worst case scenariorsquo This he explained is a

result of laws that mandated the implementation of lsquoadministrative simpli1047297cationrsquothroughout all government agencies For example he explained that in the past

FONAFIFO required applicants to submit of 1047297cial proofs of title from the public

registry of 1047297ce now FONAFIFO eliminated this requirement and its of 1047297cials review

the legal status of the 1047297nca using the public registry online system an almost

automatic process This is only possible because other agencies have modernized

their database systems as well and make the systematized data available online

Currently FONAFIFO relies heavily on an online system for the application

process and its overall work Digital forms have replaced most of the internal

paperwork that bureaucrats needed to move from of 1047297

ce to of 1047297

ce physicallyavoiding unnecessary delay in the application process Moreover good commu-

nications and widespread Internet usage in Costa Rica has provided ground for

FONAFIFO to move the application online An informant from FONAFIFOrsquos San

Joseacute of 1047297ce explained that since 2011 they decided to require most of their

applicants to submit their applications online Some people on the ground he said

met this with scepticism at the beginning but now the policy has proven successful

he states that around 90 of the applicants now submit their applications online

An informant from an NGO in Limoacuten explained however that this is mostly a

pre-application form and prospective bene1047297ciaries still need to submit additional

documents such as a map and copies of their national identity cards After

FONAFIFOrsquos lawyers in San Joseacute verify that the application complies with the




legal requirements (for example land ownership and that the applicant is up to date

with social security payments) the next step is to require the technical study by the

regente an of 1047297cially certi1047297ed forester FONAFIFO of 1047297cials on the regional of 1047297ces

analyse this study and grade each application according to the priority scale

approved in yearly decrees signed by the President of Costa RicaDespite the implementation of online systems PES of 1047297cials and some docu-

ments still have to move physically FONAFIFO personnel work and communicate

well through the online system but they still need to meet for planning work or go

to 1047297eld visits One of the informants from FONAFIFOrsquos headquarters in San Joseacuteexplained that Costa Ricarsquos small size and the fact that it is relatively well con-

nected made FONAFIFOrsquos work effective He exempli1047297ed the bene1047297ts of this by

saying that if he needed to talk personally to one of his of 1047297cers on the ground in the

farthest of 1047297ce he could call him by telephone and he would be in San Joseacute lsquoby the

afternoonrsquo Furthermore institutional cooperation among different agencies seemsto be key For example during my visit to Sarapiquiacute I participated in a supervision

visit to a 1047297nca under the PES with an of 1047297cial from SINAC and another from

FONAFIFO These informants explained that joint visits are common In this

speci1047297c case it was also out of a necessity because the regional of 1047297ce of SINAC

had run out of gasoline to fuel their vehicles so the SINAC of 1047297cial needed a ride

from the better-equipped FONAFIFO of 1047297ce As for transporting documents

FONAFIFOrsquos San Joseacute of 1047297ce needs to send to the regional of 1047297ces the contracts that

the 1047297nqueros will sign A former SINAC of 1047297cial and current NGO worker in

Sarapiquiacute said that in the past when SINAC of 1047297cials on the ground had some PESresponsibilities they also prepared the contracts themselves He explained that the

government later concentrated this responsibility in FONAFIFOrsquos headquarters in

San Jose and transferred it to lsquothe lawyersrsquo lsquoThe ones who decide now are the

lawyersrsquo he concluded with contempt

42 Trade-Offs in lsquo Rendering Legal rsquo the PES

Some legal requirements are subject of controversy among PES actors Uniformly

interviewees from NGOs on the ground and some government of 1047297cials in regional

of 1047297ces mentioned their particular frustration with what they saw as excessive rigor

by lsquothe lawyers in San Joseacutersquo responsible for evaluating the proofs of landownership

Their objections go beyond those related to the exclusion of landholders without

title A common criticism was that FONAFIFO expects a complete match between

land title certi1047297cates from the public registry and the information in the cadastre

which does not occur in many instances Informants from an NGO in Limoacuten

mentioned that 1047297xing this meant a big investment in time and money by hiring

technicians and paying government fees perhaps more than what the bene1047297ciary

can expect to receive from the PES Two of those same informants said that in one

310 PG Pentildea



case FONAFIFO turned down the application of a poor 1047297nquero whose registered

title deviated from the map in the cadastre by 1 hectare Another informant from the

same NGO told me about a 1047297nca whose title had a 10 overlap with an indigenous

territory and thus FONAFIFO also rejected it Stories like these seem widespread

and some border on the absurd In Sarapiquiacute an NGO worker told me about a 1047297ncathat was rejected by FONAFIFO because the area in the title and the information in

the cadastre had a difference of a few square decimetres mdash an area lsquooccupied by a

cowrsquos shit rsquo in the informant rsquos words

Yet this restrictive way of implementing the PES is not absurd in eyes of lsquothe

lawyersrsquo Most of the same informants who narrated these stories also explained

that FONAFIFO of 1047297cials defer many decisions to lsquothe lawyersrsquo and refrain from

making calls themselves A FONAFIFO of 1047297cial on the ground explained that he

sends his report to the San Joseacute headquarters and lsquothe lawyersrsquo tell him what to do

lsquoThey are the ones who have power rsquo this informant reasoned One of the Sarapiquiacuteinformants a NGO worker explained that in recent years the press has been

looking for irregularities in the PES so now bureaucrats are very cautious and

before even considering a special request they just say lsquonorsquo In addition due to their

legal training lsquothe lawyersrsquo probably feel constrained by the letter of the law in the

PES regulations and the mandates of other laws that tightly regulate the use of

public funds (Pagiola 2008) Recent scholarship has framed this as a problem of a

PES system with a positivistic approach that gives little value to interdisciplinarity

(Barreiro 2012)

In reality of course cadastre and public registry do not go hand by hand becausedifferent agencies administered each of them in the past and they have been sub-

jected to institutional legal and technical changes throughout the years However

the law and its operators within the PES are unable to capture this complexity In

this sense the PES is an example of a scheme that deems necessary to simplify

reality in order to make nature and people more attainable to a State that wants

better control as described in other places (Scott 1999)

As a result the current lsquorule of the lawyersrsquo is highly functional to the PES So

far due mainly to 1047297nancial constraints the PES has been incapable of satisfying the

total demand of 1047297nqueros wishing to be included in the program One informant from a NGO in Sarapiquiacute stated that in past years FONAFIFO ended up approving

only 30 of the applications and thus lsquothe lawyers cheeredrsquo to the prospect of

further regulating the admissions criteria A fellow NGO worker agreed to this idea

saying that FONAFIFO seeing so much demand said lsquoLet rsquos become espesosrsquo1

Thus a big demand may have driven FONAFIFO to come up with more barriers to

access in the form of additional or more stringent legal requirements which are

framed as objective and technically sound As seen in other places FONAFIFO as

a governmental and development structure places a high regard into simplifying

and rationalizing nature and peoplersquos use of nature by lsquorendering it technicalrsquo

(Li 2007 Scott 1999) In the particular case of Costa Ricarsquos PES lsquothe lawyersrsquo play

1Espesos is Spanish for thick or dense meaning also picky or dif 1047297cult




a higher role in this simpli1047297cation and rationalization process through what could

be called a process of lsquorendering legalrsquo

43 Administering and Supervising the PES

Despite the bulk of demand 1047297nding potential bene1047297ciaries does not seem to be an

easy task As one experienced informant from an NGO in Sarapiquiacute put it lsquoyou

donrsquot see lines of people [waiting] outsidersquo Some informants NGO workers said

that there has been disbelief among some 1047297nqueros on the programrsquos intentions

This experienced informant explained that many in rural areas especially the poor

doubt that someone will pay them for conserving their forests or lsquofor doing noth-

ingrsquo In Limoacuten the daughter of a bene1047297ciary described that his father was lsquothe most reluctant rsquo of his neighbours to enter the program because he believed that this was a

taking in disguise by the government The NGO informants from Limoacuten con1047297rmed

that this belief had been somewhat common among the rural people in the area

This may be originated in upsetting past experiences of expropriations of private

land that overlapped protected areas under the Wildlife Conservation Act of 1992

as one of the informants suggested

In general the PES on the ground looks a lot like the instructions provided in the

Procedural Manual but with more sweating During my time in Limoacuten I accom-

panied two NGO workers to La Estrella valley to visit a 1047297nca from a local schoolthat had just signed up to the program According to plan the group comprised by

NGO and school workers walked the limits of the property to verify the condition

of the forest see if the borders had been properly cleared and hang signs that read

lsquoPrivate property under conservation Payment for Ecosystem Services programhelliprsquo

It was a 5-hour hike through a hilly terrain without pathways at various times and

under dense tropical foliage2 One of the NGO workers was a certi1047297ed regente and

as such he was responsible for subscribing the PES documents of the 1047297nca and

conduct yearly visits to make sure the landowners comply with the program

Visiting potential bene1047297

ciaries and traversing their 1047297ncas is part of the everyday jobof NGO workers and regentes who promote and sign up 1047297ncas to the PES

The regencia system as it turns out is one of the most interesting features

allowing the program to function properly a system that is not exclusive to the PES

but part of the broader forestry governance of Costa Rica Under this system a

certi1047297ed regente must verify and approve most forestry activities in the country

This system includes checks and balances ensuring reliance in the regencia work

and the information it provides The Forestry Act of 1996 sanctioned the regencia

2To a city-dweller like me this felt like a very strenuous feat although the rest of the group

seemed mostly adept at it

312 PG Pentildea



system and assigned the task to supervise the work of regentes to the Colegio de

Ingenieros Agr oacutenomos an of 1047297cially regulated professional association An infor-

mant from the Forestry Prosecutor rsquos Of 1047297ce at the Colegio de Ingenieros Agr oacutenomos

(also a creation of the Forestry Act) explained that their work is to lsquocontrol the

practice of the professionrsquo Six of 1047297cers from this agency supervise all forestryregentes through administrative and on-site audits Some of them go on one 1047297eld

tour per month to pre-selected sites which may or may not include 1047297ncas under the

PES The database run by the Colegio de Ingenieros Agr oacutenomos is also a product of

the Forestry Act of 1996 which mandates that regentes send copies of all the

documents they sign to this institution This allows this agency to conduct

administrative reviews which means that each year they select approximately 10

of the regentes and go over their documents to look for inconsistencies that look

suspicious such as too many regencias done by the same regente at the same time

Interestingly the same informant explained that it is not usual for regentes tooversee many 1047297ncas under the PES at the same time implying that the regencia

work in these 1047297ncas is more demanding than the regencia work for timber man-

agement in other 1047297ncas

These informants also explained that unlike the other of 1047297ces at the Colegio de

Ingenieros Agr oacutenomos the Forest Prosecutor rsquos of 1047297ce has reliable and usually

suf 1047297cient funds to do their work A provision in the Forestry Act of 1996 that

earmarked a portion of the forestry tax to this agency is important to provide

sustained funds Also the fact that this agency monopolizes the production and

selling of of 1047297cial stationary that regentes must use in the documents they sign helpsprovide sustainable funds for their supervisory work Financial stability strengthens

this of 1047297cersquos autonomy and allows them to work well thus providing con1047297dence in

the regencia system

SINAC and FONAFIFO collaborate in this supervisory task of the 1047297ncas under

the PES FONAFIFO only acquired additional supervisory duties later in the life of

the program as part of the decentralization and strengthening process that led to the

creation of eight FONAFIFO of 1047297ces throughout the country (FONAFIFO 2005)

Thus supervision of PES 1047297ncas is constant and the work of the regentes in the PES

is under continuous examination by different agencies One informant from aSarapiquiacute NGO argued that in their case this makes the PES more burdensome

than it needs to be He mentioned that sometimes lsquo[the auditing agencies] go too

far rsquo and preparing the documentation and being subject to the auditing process

takes too much time

44 Managing Illegality

Non-compliance within the PES however seems rare Most informants explained

that in general overt deforestation in Costa Rica is extremely uncommon and




instead some 1047297nqueros engage in socola These informants described the process

of socola as being a concealed and slow degradation of the forest in the margins of

farmland which starts by clearing the understory and then converting the forest

gradually into agricultural land A FONAFIFO lawyer explained that they have

detected some socola in 1047297ncas under the PES but it has been minimal He alsomentioned that in the PES they have found lsquoonly a couple of cases [of land use

change] but because it rsquos a crime then [people donrsquot do it]rsquo Informants described

how banning land use change and other provisions restraining 1047297nqueros from

cutting down trees in protection areas deter them from engaging in illegal acts An

experienced NGO worker from Sarapiquiacute explained that many rural people are

afraid of getting caught in illegal activities because they have to go to court and use

lawyers that is to say 1047297nqueros are afraid of getting entangled in a criminal justice

system they are unfamiliar with Building on this informant rsquos suggestion it appears

that deterrence in Costa Ricarsquos forest governance stems from the very idea of beingdrawn into strange governmental of 1047297ces and courtrooms and unknown procedures

rather than by the prospect of punishment by itself (ie prison time)

Despite this deterrence effects sometimes crimes occur and some informants

from an NGO in Sarapiquiacute expressed their frustration with the criminal justice

system in these cases According to them judges are too lenient with the lsquopoor rsquo

1047297nqueros and think as if lsquocutting a little tree is not a big dealrsquo Furthermore one of

these informants explained that judges in rural Costa Rica try to avoid conviction by

raising the standard of proof to unreasonable levels lsquoHave you seen him with the

match in his handrsquo is the type of question a judge would ask to prosecutors or witnesses in a case involving the burning of a forest according to this informant

An informant from the FONAFIFO headquarters a lawyer saw this from a different

perspective In this informant rsquos view the criminal justice system compared to other

countries works well and is another reason why rural people are deterred from

damaging the forest Furthermore this informant ties an explicit link between the

deterrence factor of the ban on land use change and the incentives provided by the

PES To him the PES is a way for 1047297nqueros to at least make some money off the

1047297nca and avoid getting into trouble

Violations from 1047297nqueros under the PES are uncommon but they do occurwhich triggers the involvement of government of 1047297cials A FONAFIFO of 1047297cial from

Sarapiquiacute exempli1047297ed what to him constituted a major mdash although rare mdash violation

He showed me a picture on his computer of a 1047297nca forest that had been deforested

by less than a hectare for agriculture lsquothis is very atypicalrsquo he said Before the

supervision visit described earlier in Sarapiquiacute the of 1047297cial from SINAC had

received information of illegal logging inside the PES 1047297nca The 1047297nca owners had

in fact cut down trees in the area as it was apparent from the wood laying on site

The FONAFIFO and SINAC of 1047297cials had no problem entering the property and

verifying the state of the forest These informants explained that they have the

authority to do so under the Forestry Act and that only in a rare occasion one of

them needed to enforce his authority by bringing along the police One of the

informants from the Forestry Prosecutor rsquos of 1047297ce of the Colegio de Ingenieros

Agr oacutenomos attested to the fact that of 1047297cials working in the PES are highly

314 PG Pentildea



respected on the ground When recently appointed fellow of 1047297cials told this

informant to lsquobe aware now that [he]rsquoll be the new son of a bitchrsquo but despite that

frightening forecast he says he hasnrsquot run into much trouble while on the job One

informant a FONAFIFO lawyer explained that most violations in the PES occur

from causes other than damage to the forest such as landownership conflicts or invasions from precaristas3 In these cases he said they would put the payment on

hold or exclude the speci1047297c area in conflict This informant explained that

FONAFIFO is not interested in cancelling PES contracts and thus gives oppor-

tunity to bene1047297ciaries who are not complying by giving them a warning

Conservation NGOs play an active role in the PES (Locatelli et al 2008) In

Sarapiquiacute and Limoacuten the NGOs where the informants worked are intermediaries

between FONAFIFO and the 1047297nqueros wishing to enter the PES or currently inside

the program One informant from Limoacuten a NGO worker mentioned that many

1047297nqueros are grateful for this work This informant perceived that the work theyperform is very important to him if it were not for the NGO he works for there

would be much less 1047297ncas under PES in his region An NGO worker from

Sarapiquiacute corroborated this idea by saying that 1047297nqueros lsquoneed a lot of helprsquo 1047297lling

out the PES applications and thus they provide this support He gave an example of

this by saying that lsquothere are many people that donrsquot even know what noti 1047297cacioacuten4

meansrsquo in the application form

The role of NGOs as intermediaries of the PES is not a de facto job the

Procedural Manual states that NGOs wishing to collaborate with the PES can sign a

formal agreement with FONAFIFO This agreement allows NGOs to receivepayments from FONAFIFO and channel them to the bene1047297ciaries This is an

important part of their role as it provides means for bene1047297ciaries to have access to

their funds more easily by distributing the funds to where the 1047297nqueros are located

The way FONAFIFO distributed payments had been an issue of controversy in the

past with the government being slow in disbursing the amounts owed which led to

disputes (Castro Salazar and Pentildea Chacoacuten 2011) This situation has improved since

then Different informants explained that because applying for the PES requires

specialized work from a regente it could be expensive Thus most 1047297nqueros and

regentes make an arrangement by which they pay regentes only after the 1047297ncaenters the program using the funds from the PES payments In the case of NGOs

informants explained that they too charge a fee they claim is lower than what an

independent regente would charge These arrangements are an important part of the

PES mechanics as they incentivize regentes to look for more 1047297ncas to sign them up

to the PES and provide poor 1047297nqueros with a way of navigating the relatively high

transaction costs of the program

3From the Spanish word precario which means instable in reference to squatters4 Noti 1047297cacioacuten is Spanish for legal notice In the application form there is a space asking applicants

to write down their direccioacuten para noti 1047297cacioacuten ie their of 1047297cial mailing address




5 Flapping Butterflies The Unexpected Influence of Past

Present and Foreign Laws and Policies in the PES

51 Past Flaps

Other laws and policies mdash past external and foreign mdash have constantly shaped Costa

Ricarsquos PES Costa Rica built the PES upon an extensive experience with past forest

policies (Daniels et al 2010 Pagiola 2007) By 1997 the country already had a

strong and experienced forest bureaucracy as well as lessons learnt from experi-

menting with the initial forest subsidies mainly aimed at timber activities In

addition in the 1980rsquos and 1990rsquos the government was subject to institutional

changes that took out forests from the agricultural sector and put them inside the

newly created MINAET Despite this relocation the forest service the wildlifeagency and the protected areas agency were still separate semiautonomous agencies

within the same ministry A former high of 1047297cial at MINAET involved in these

institutional changes explained that the division of forest issues in 3 semiau-

tonomous agencies was inef 1047297cient and led to lack of coordination on the ground In

1994 the government merged these agencies giving rise to SINAC agency in

charge of all forest-related issues in Costa Rica In line with past scholarship this

informant considered that the past experimentation with forest incentives and the

consolidation of agencies that allowed for a coherent public forest policy were

lsquoenabling conditionsrsquo to design the PES that we know today (Pagiola 2008 Daniels

et al 2010)

52 The Flaps of the Swarm

At present there are concurring legal provisions within the Forestry Act of 1996

that have been key in the development of the PES The regencia system explained

earlier is an interesting example but there are others The ban on land use change is

particularly important to the extent that it effectively made the PES politicallyviable The Forestry Act of 1996 that created the PES also forbade clear cutting or

land use change in the entire country the convergence of both policies in the same

law was not a coincidence A bill introduced in 1994 named lsquoLey CULPArsquo5

effectively sought to ban not only land use change but also all timber cutting from

natural forests (Aguilar 1995) This bill eventually failed to pass Congress but

became part of the political discussion on solutions to reduce deforestation in Costa

Rica (Le Coq et al 2010) Informants who were part of these political processes

explained that the PES was in part a negotiated agreement to allow for a lighter

lsquoLey CULPArsquo (ie a ban on land use change but not on timber extraction from

5CULPA is the acronym for lsquoCortar Uacutenicamente lo Producido Ahorarsquo which is Spanish for lsquoCut

only the [timber] currently plantedrsquo Culpa also means lsquoguilt rsquo in Spanish

316 PG Pentildea



natural forests) to pass as a provision within the Forestry Act of 1996 Thus the

PES was effectively negotiated as a compensation to those affected by the prohi-

bition of clear-cutting the forest namely those who used the forest for agricultural

and cattle ranching purposes This ban on land use change along with a tax on

gasoline earmarked to fund the PES are strongly tied together with the creation of FONAFIFO and can be regarded as part of the same PES system Furthermore

these 3 policies have been coexisting since 1997 As a result any analysis on the

effectiveness of the PES would be incomplete without accounting for this symbiosis

(Daniels et al 2010 Pagiola 2008)

Behind the PESrsquos rationale was the growing idea that the government and its

laws could not just mandate an environmentalism of the rural people they had to

provide them with compensation One informant the leader of an NGO explained

that in the past people in cities believed that lsquothe forests belonged to all Costa Rican

peoplersquo but now they are beginning to understand that those forests actually haveowners that ought to be compensated Several other informants reiterated this

compensatory discourse Interestingly the PES political process and its subsequent

development might have helped induce a far more interesting cultural change in

which rural landowners and their land rights are better acknowledged and recog-

nized by city dwellers than before

Laws and policies outside the forestry sector also influence the way the program

functions One example is the Treasury Inspector rsquos Of 1047297ce intervention on

FONAFIFOrsquos autonomy and use of funds Originally the government designed

FONAFIFO to be a semi-public institution a trust under private law Most infor-mants agreed that this feature made FONAFIFO an ef 1047297cient institution for

example it had very low administrative costs below 7 according to one of them

This changed as FONAFIFO became lsquobureaucratizedrsquo in one informant rsquos words

An informant from FONAFIFOrsquos legal team explained that the Treasury Inspector rsquos

Of 1047297ce decided that FONAFIFO was an agency of the government in full and thus

had to comply with the laws regarding public employees doubling FONAFIFOrsquos

operating costs to 14 6 As a result through this interpretation of the public funds

laws many informants argue that the Treasury Inspector rsquos Of 1047297ce changed the agile

and fl

exible nature of FONAFIFOFurthermore the Treasury Inspector rsquos Of 1047297ce stated that the funds that

FONAFIFO obtained from donations were also public funds under the law and thus

more stringent legal conditions applied For example FONAFIFO could not use

those funds to pay people illegally occupying public lands (Pagiola 2008) This

later changed after Congress passed the law approving the second World Bank loan

for the PES that included a provision allowing informal landowners to enter the

PES as mentioned by an informant who was a former high of 1047297cial at MINAET

Also another informant former head of the national parks service explained that

public funding laws such as the Law for the Financial Equilibrium of the Public

Sector of 1984 and the Law for Containing Public Expenditure of 1985 were the

6Under the current law FONAFIFOrsquos operating costs theoretically reach to 23




basis of these policies These laws were originally put together to deal with the

1980rsquos economic crises and by applying them to FONAFIFO they reduced its

flexibility of expenditure (for example they provided labour stability but also made

more cumbersome hiring new personnel) An informant the former head of an

NGO suggested that the reason for these institutional changes was the fact that FONAFIFO was lsquothe rich cousin of the poor Ministryrsquo and thus MINAET and the

rest of the government wanted more control over FONAFIFOrsquos valuable assets

A well-known legal principle in the civil law tradition is the lsquo1047297rst in time better

in right rsquo7 principle and FONAFIFO used it as the default 1047297lter to access the PES

FONAFIFO applied this principle as a lsquo1047297rst-come 1047297rst-servedrsquo application process

in the early years of the program leading to a disproportionate representation of

large landowners in the PES (Castro Salazar and Pentildea Chacoacuten 2011) An informant

from an NGO in Sarapiquiacute explained that they complained to FONAFIFO about

this policy because the process focused on the ability of prospective applicants toput together an application faster rather than the suitability of each 1047297nca and

applicant This principle was dropped by FONAFIFO soon after according to this

informant He mentioned this example to describe that in his view FONAFIFO is

an institution that is open to listening to other rsquos opinions and learn from its mis-

takes Furthermore to him the use and abandonment of this principle signalled a

normal trend of regulating through trial and error in what he saw as a rather good

institution The opinion of FONAFIFO as a good institution was widespread across

all interviewees When asked about the possible institutional improvements to

FONAFIFO a former head of an NGO said that to him there is no obvious need for change he even went as far as to say that FONAFIFO lsquois perfect rsquo

53 Flapping from Afar

International laws and policies have also influenced Costa Ricarsquos forest policy and

the PES The World Bank adjustment plans of the 1990rsquos are examples of foreign

policies that infl

uenced the PES (Daniels et al 2010) Following World Bankdirectives Costa Rica had to liberalize its economy and discontinue many of its

subsidies Around that time Congress was discussing the new Forestry Act of 1996

that included the PES effectively a program to transfer public funds to private

hands In order for this to be amenable to the World Bank supporters cleverly

framed the PES as a program that does not provide subsidies but pays for actual

services mdash a market mechanism (Le Coq et al 2010) In this sense the PES was a

result of neoliberal international forces (Fletcher and Breitling 2012) These forces

were in line with conservation policies coming from the Rio Conference of 1992

7In Latin lsquoprior in tempore potior in iurersquo from Roman Law

318 PG Pentildea



and the already ongoing PES projects executed by the not-for-pro1047297t Fundacioacuten para

el Desarrollo de la Cordillera Volcaacutenica Central mdash FUNDECOR with funds from the

United States Agency for International Development mdash USAID Framing the PES as

a scheme to pay for services and not to provide subsides remains largely in the

minds of most interviewees as was constantly stressed during our conversationsHowever despite the PESrsquo aspirations at being the flagship of a market-based

scheme for conservation some scholars contend that it remains a subsidy program

at its core (Fletcher and Breitling 2012)

The international context in favour of tools like PES also had an influence in the

World Bankrsquos approval of two consecutive loans to Costa Rica explicitly aimed at

funding the PES These loans have proven key for the relatively widespread

implementation of the program around the country Informants from FONAFIFOrsquos

of 1047297ce in San Joseacute said that the second loan still active at the time of this research

accounted for around half of FONAFIFOrsquos budget In fact the loansrsquo impact goesbeyond this major economic contribution International contracts formalize these

loans which Congress then approves This high legal layer surrounding the inter-

national loans shielded the PES from political instability and changes in 1047297scal

priorities This suggests that the importance of the loans is as much economic (ie

necessary funding) as it is legal (ie abating the possibility that political instability

could reduce funding for the PES) This does not mean that supportersrsquo defense of

the PES from political instability is effortless despite most informantsrsquo comments

that the PES enjoys a good amount of public support An informant who was a

former head of an NGO explained that some years ago there was a sense that thegovernment was starting to question the PES so the environmental movement put

together an ample forum to defend it as a precautionary move However even when

asked about external factors possibly affecting the largely favourable attitudes

towards the PES (ie higher international prices of oil threatening the support of the

gasoline tax that funds the PES) most informants agreed that the PES would stay

put

Despite public support and past 1047297nancial stability most informants said that the

PES was soon to be in 1047297nancial distress An informant the head of an NGO

explained that the second World Bank loan was set to expire very soon with nooptions for renewal Two informants from FONAFIFOrsquos headquarters con1047297rmed

that the expiration of the loan would have an impact although they showed less

concern than the non-governmental informants familiar with this did In our con-

versations the informants from FONAFIFOrsquos main of 1047297ce focused more on

explaining their efforts to diversify FONAFIFOrsquos 1047297nancial sources For example in

2005 a new law imposed a water tariff speci1047297cally aimed at 1047297nancing PES farms of

the watershed where the fee was collected (Pagiola 2008) In addition FONAFIFO

has been reaching out to hydroelectric operators and other big companies to set up

voluntary 1047297nancial agreements to 1047297nance the PES and receive ecosystem services

certi1047297cates in return (Pagiola 2008 Russo and Candela 2006) An informant from




FONAFIFOrsquos main of 1047297ce explained that more recently FONAFIFO made an

agreement with the National Bank of Costa Rica to introduce a new lsquogreen debit

cardrsquo for which a percentage of the bankrsquos commission goes to a Fund for the PES

Despite these efforts there was certainly a sense of anxiety among most of the

interviewees familiar with the PESrsquo 1047297nancial structure despite of 1047297cial discourse Asone informant head of an NGO said lsquothe thinking of those who run FONAFIFO has

to change they have yet to realize that the loan is endingrsquo

The PESrsquo 1047297nancial constraints have pushed for seeking alternative sources of

funding in the Reduction of Emissions from Deforestation and Degradation (REDD

+) mechanism Costa Rica has been actively engaging in the REDD+ international

conversation through the Readiness for REDD+ country process sponsored by the

World Bankrsquos Forest Carbon Partnership Facility (FCPF) FONAFIFO takes this

effort seriously and it appointed a person within the agency to coordinate the

readiness process for the entire country Costa Ricarsquos incorporation into the FCPFprocess assumes that it can strengthen current forest conservation policies or

develop additional ones to the ones already existing like the PES particularly in an

academic and policy situation where the alleged causal relationship between the

PES and the countryrsquos reduction of deforestation is a contested issue When asked

about the difference between the PES and REDD+ the person in charge of the

readiness for REDD+ at FONAFIFO described REDD+ as being lsquomore compre-

hensiversquo However as our conversation progressed it became hard to distinguish

this difference

Conceptually it seems dif 1047297cult to differentiate the PES from REDD+ as bothaim at reducing deforestation by compensating for the provision of ecosystem

services speci1047297cally carbon storage This similarity may have actually played in

favour of Costa Rica which seems to have been successful in arguing the case that

it should become a lsquoREDD+ countryrsquo in the FCPF jargon Even though Costa Rica

current ly has net positive annual forest change rate (095 in the period of 2005 to

2010)8 and thus is not immediately appealing for REDD+ in its traditional sense it

compensates it with good and effective forest governance embodied in the PES a

characteristic that others have suggested may be even more relevant (Phelps et al

2010) In the assessment of Costa Ricarsquos Readiness Preparation Proposal for REDD+ the FCPF (2012 p 8) states lsquoCosta Rica is now seeking a new funding mech-

anism that would reward the carbon services it provides to the world It is envisaged

that REDD would allow Costa Rica to receive sustainable 1047297nancial transfers from

the international community while consolidating improving and scaling-up the PES

programrsquo Framing Costa Rican forest conservation policies like the PES to 1047297t

current international trends in conservation such as REDD+ is still an ongoing

effort

8see httpforisfaoorgstaticdatafra2010FRA2010GlobaltablesEnJune29xls accessed on July

3 2015

320 PG Pentildea



6 The Butterfly Effect Understanding the Policy

and Legal Context of Costa Ricarsquos Pes

This paper focuses on the legal and policy context of the PES the backbone of theprogramrsquos governance It reviewed the perceptions of bureaucrats at governmental

agencies and workers of non-governmental organizations in two implementation

areas and the administrative centre in San Joseacute This allowed for a comprehensive

study that includes contrasting descriptions of the same phenomena Through the

analysis of the PES on the ground and the law that surrounds it this paper sheds

light into how the legal and policy context mattered for designing and implementing

this conservation programme However this study has limitations bound by the

short time spent in the area the relatively small space covered and the number as

well as type of informantsA look at on-the-ground implementation of the PES provides interesting

opportunities to reflect on the effects of the legal framework For example the way

violations to forest laws occur and are dealt with by judges and PES of 1047297cials as well

as the criminalization of land use change by the Forestry Act of 1996 most likely

had an effect in the quality and quantity of the Costa Rican forest cover that is

missed in additionality studies Also some 1047297nquerosrsquo impression that the govern-

ment was attempting concealed takings through the PES has historical and legal

basis on the expropriation processes mandated by the protected areas legislation on

private lands overlapping these areas This could help understand what types of

1047297ncas were most likely to enter the program in the 1047297rst years and why

The PES governance has other interesting characteristics as well The issue of

access for example has been subject to prior research focusing on how landholders

without title have been mostly left out or on the high transaction costs involved

(Zbinden and Lee 2005 Pagiola 2008) However also important for the question of

access is understanding how the process leading to exclusion or inclusion mdash the PES

procedure mdash works This procedure has been changing and now includes modern

technological solutions such as online application forms supported by a notable

intranet system that bene1047297ts from other agenciesrsquo online databases People and

documents still have to move however and Costa Rica seems to have a compar-ative advantage in its size and accessibility

Interestingly the procedure itself is not currently a subject of much criticism by

the informants as it is the rigor applied in the evaluation of new applications This

critique showcased an interesting bureaucratic divide within the PES which does

not run across traditional lines of scale (ie regional of 1047297ces versus San Joseacuteheadquarters) so much as across professions mdashlsquothe lawyersrsquo versus lsquothe techni-

ciansrsquo Informants on the ground seem to believe there is a shift in power within

FONAFIFO from the technical to the legal The will of rendering everything

technical (Li 2007) was embedded in the PES as implied by informants on theground who longed for a more technical and less legal past but now lsquothe lawyersrsquo

seem to have moved further into lsquorendering legalrsquo the program This goes beyond

the efforts to simplify peoplersquos attitudes and conducts towards nature to bene1047297t a




controlling State which are a staple of the contemporary State (Scott 1999) The

animosity of lsquothe techniciansrsquo towards lsquothe lawyersrsquo highlights a deeper signi1047297cance

of the role of law in conservation

For a State to be able to fully make nature attainable to its control it is in need of

both a process of lsquorendering technicalrsquo that simpli1047297es the environment and aprocess of lsquorendering legalrsquo to codify it or in fact translate it into the governmental

lingua franca For better or for worse the law ends up being the common language

spoken by all forest bureaucrats working in the PES where technicians may be

capable but lawyers are native-speakers and the of 1047297cial translators It is important to

understand however that the current extent of the process of lsquorendering legalrsquo in

the PES has not been always the same it has changed and evolved This asserted

rule of lsquothe lawyersrsquo through the process of lsquorendering legalrsquo plays a role that is

functional to a program that has a three to one demand ratio by de1047297ning the PES

application requirements in a more restrictive way In the process some bizarreresults occur which are mainly due to an inherent dif 1047297culty of the law and its

implementers to incorporate the complexities of reality as explained by previous

scholarship (see for example Scott 1999) We still need to comprehend fully

whether or how exactly lsquorendering legalrsquo the PES or other environmental institu-

tions and mechanisms affects their performance

Past present and international laws and policies outside the boundaries of the

PES regulatory regime also shape the way the PES evolved and functions The PES

did not occur in a vacuum as it is a product of years of previous policy incentives

which provided a solid basis for its development (Daniels et al 2010 Le Coq et al2010 Pagiola 2008) However concurring laws and policies also affect the PES

A 1047297rst set of these influencing policies and laws are the ban of land use change and

the gasoline tax both within the Forestry Act of 1996 Without them the PES

would have had different results by lacking sustainable funding and rural support

or more importantly it is likely Congress would have not passed it in the 1047297rst

place Thus these are not just complementary legal provisions but key elements of

the entire governance of the PES they should be accounted for when analysing the

PESrsquo additionality A way to do this would be to include forest crime data effec-

tively a proxy for land use change in the modelsThere are other examples of non-PES laws that influence its impact on the

ground The regencia system with its supervisory checks and balances the appli-

cation of public funds laws that reduced FONAFIFOrsquos flexibility as well as the

administrative simpli1047297cation process across the Costa Rican government are prime

examples of policies outside the PES that strongly influence the way it is imple-

mented Finally the default application of the lsquo1047297rst in time 1047297rst in right rsquo civil law

principle during the early years of the PES may have influenced who was able to

access the program likely bene1047297ting even more those 1047297nqueros who had the means

and knowledge to submit an application faster to the detriment of their poorer

counterparts It is also possible that by dropping this principle in the application

process lsquothe lawyersrsquo became more prominent as FONAFIFO was in need of

looking for newer or additional legal requirements different to this simple rule

322 PG Pentildea



The legal framework surrounding the PES is certainly a product of many con-

ditions of its time including cultural ideas but it is possible that a feedback loop

allowed it to impact social constructs and cultural beliefs as well Informants

repeated the mantra within the PES system that 1047297nqueros are not paid subsidies but

compensated for services this may have far-reaching consequences Interestinglyframing the PES as a market-based program that pays for something in return (ie

not a subsidy) developed in part as a way around the imposed liberal policies of the

World Bank of the 1990rsquos but now it seems also embedded in the mindsets of many

Costa Ricans As one of the interviewees explained apparently now people in cities

understand that they owe something to the rural people for their conservation

efforts that is to say that forests are not a given and they belong to somebody who

needs to be compensated usually poor 1047297nqueros The importance of this cultural

shift could be major on other social aspects beyond the scope of this research like

economic inequality or democratic representationAs FONAFIFO and Costa Rica looks into the future uncertainty and a will to

adapt mark the PES The most pressing issue was how to ensure reliable sources of

funding after the last World Bank loan expired FONAFIFO has been trying to

diversify its 1047297nancial sources through partnerships with energy companies and the

Bank of Costa Rica as well as water tariffs Nevertheless the program is in need of

more substantial and reliable funds and eyed REDD+ as the most likely option In

this process they have engaged in a similar past experience of framing their efforts

in the terms set by the international legal and policy agenda which in the past was

one that discouraged the use of subsidies and now is the REDD+ trendFinally it is important to acknowledge that although the governance of the PES

relies on a web of legal mandates and institutional arrangements people on the

ground ultimately execute the program Implementing the PES is hard work It

requires walking across hilly forests talking to many people measuring sweating

convincing and walking further In this sense borrowing from Barnesrsquo idea of what

lsquomakesrsquo water in Egypt (2014) the PES and the ecosystems services provision it

seeks to secure is in fact constantly lsquomadersquo by the daily work and decisions of

implementers and bene1047297ciaries on the ground from the 1047297ncas to the of 1047297ces After I

stopped exhausted in the middle of a 1047297

eld visit my NGO informant turned to meand sentenced lsquoldquothisrdquo is PESrsquo

Acknowledgments I would like thank various people for their contribution to this chapter First

Mr Carlos Manuel Rodr iacuteguez of Conservation International mdash Costa Rica for his support and

guidance for this research Also to the students and instructors of the lsquoWriting in the Social

Sciencesrsquo workshop at Yale FampES for extensively reviewing the 1047297rst drafts Finally to my

informants on the ground from Limoacuten and Sarapiquiacute for generously sharing their time and

patiently waiting for me on the 1047297eld to catch my breath

I would like to acknowledge the 1047297nancial support at Yale University provided by the Tropical

Resources Institute the Program of Agrarian Studies the Jubitz Family Endowment for Research

Internships Fund and the Carpenter Sperry Fund which allowed me to conduct this researchFinally special thanks should be given to Dr Amity Doolittle at Yale University for her advice

and continuous support to this research project




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Adams WM Hutton J (2007) People parks and poverty political ecology and biodiversity

conservation Conserv Soc 5(2)147ndash183

Aguilar X (1995) Veda forestal iquestuna llamada de atencioacuten Rev Forestal Centroamericana 4(11)40ndash43

Arraigada RA Ferraro PJ Sills EO Pattanayak SK Cordero-Sancho S (2012) Do payments for

environmental services affect forest cover A farm-level evaluation from Costa Rica Land

Econ 88(2)382ndash399

Barnes J (2014) Cultivating the Nile the everyday politics of water in Egypt Duke University

Press Books Durham

Barreiro P (2012) Opportunity analysis of payment for ecosystem services policy design and

implementation for coffee agroforestry systems in Costa Rica Trop Resour 3156ndash66

Castro Salazar M Pentildea Chacoacuten M (2011) The case of Costa Rica In Greiber T Schiele S

(eds) Governance of ecosystem services lessons from Cameroon China Costa Rica and

Ecuador IUCN Gland pp 73ndash

91Camacho MA Segura O Reyes V Aguilar A (2000) Pago por servicios ambientales en Costa

Rica Prisma San Salvador

Cole RJ (2010) Social and environmental impacts of payments for environmental services for

agroforestry on small-scale farms in southern Costa Rica Int J Sustain Dev World Ecol

17208ndash216

Daniels A Bagstad K Esposito V Moulaert A Rodriguez CM (2010) Understanding the impacts

of Costa Ricarsquos PES are we asking the right questions Ecol Econ 69(11)2116ndash2126

FCPF (2012) Forest carbon partnership facility Costa Rica forest carbon partnership facility REDD

readiness readiness preparation proposal (R-PP) assessment note Retrived April 26 2013

from httpsforestcarbonpartnershiporgsitesforestcarbonpartnershiporg 1047297lesDocuments

Costa20Rica20RPP20Assessment20Notepdf Fletcher R Breitling J (2012) Market mechanism or subsidy in disguise Governing payment for

environmental services in Costa Rica Geoforum 43(3)402ndash411

FONAFIFO (2005) FONAFIFO over a decade of action FONAFIFO San JoseacuteFONAFIFO (2012a) Distribucioacuten de hect aacutereas contratadas en pago de los servicios ambientales

por antildeo y por modalidad Retrieved December 1 2012 from httpwwwfona1047297fogocrtext_

1047297lesservicios_ambientalesDistribucion20de20hectareas20contratadas20PSA20por

20AC3B1o20y20Modalidad201997-2011pdf

FONAFIFO (2012b) Emission reduction program idea note Costa Rica Retrieved November 10

2012 from httpwwwforestcarbonpartnershiporgsitesforestcarbonpartnershiporg 1047297les

DocumentsPDFOct2012Costa20Rica20FCPF20ER20PIN20v3201620Sept

202012-ENGLISH20revpdf Government of Costa Rica (2009) Manual de Procedimientos para el Pago de Servicios

Ambientales Retrieved July 3 2015 from httpwwwfona1047297fogocrdocumentacionbiblioteca

decretos_manualesmanualpsa_2009pdf

Le Coq JF Froger G Legrand T Pesche D Saenz-Segura F (2010) Payment for environmental

services program in Costa Rica a policy process analysis perspective Retrieved September 9

2012 from httpwwwserena-anrorgIMGpdf04-2010_PES_costa_rica_-_PES_policy_

process_V03_1047297nalpdf

Li T (2007) The will to improve governmentality development and the practice of politics Duke

University Press Durham

Locatelli B Rojas V Salinas Z (2008) Impacts of payments for environmental services on local

development in northern Costa Rica a fuzzy multi-criteria analysis For Policy Econ 10(5)275ndash285

324 PG Pentildea



McShane TO Hirsch PD Trung TC Songorwa AN Kinzig A Monteferri B Mutekanga D

Thang HV Dammert JL Pulgar-Vidal M Welch-Devine M Brosius JP Coppolillo P

OrsquoConnor S (2011) Hard choices making trade-offs between biodiversity conservation and

human well-being Biol Conserv 144(3)966ndash972

Morse WC Schedlbauer JL Sesnie SE Finegan B Harvey CA Hollenhorst SJ Kavanagh KL

Stoian D Wulfhorst JD (2009) Consequences of environmental service payments for forest

retention and recruitment in a Costa Rican biological corridor Ecol Soc 14(1)23

Pagiola S (2002) Paying for water services in Central America Learning from Costa Rica In

Pagiola S Bishop J Landell-Mills N (eds) Selling forest environmental services market-based

mechanisms for conservation Earthscan Publications Ltd London pp 37ndash61

Pagiola S (2008) Payments for environmental services in Costa Rica Ecol Econ 65(4)712ndash724

Pentildea Chacoacuten M (2004) El r eacutegimen econoacutemico y jur iacutedico de los servicios ambientales Medio

Ambiente amp Derecho 10

Pentildea Chacoacuten M (2006 nd) The legal and economic regime of environmental services in Costa

Rica Retrieved December 1 2012 from httpcmsdataiucnorgdownloadsnewsletter_2006_

enpdf

Phelps J Guerrero MC Dalabajan DA Young B Webb EL (2010) What makes a lsquoREDDrsquo

country Glob Environ Change 20(2)322ndash332

Plaff A Robalino JA Sanchez-Asofeifa GA (2008) Payments for environmental services

empirical analysis for Costa Rica Duke University Durham

Robinson J Redford K (2004) Jack of all trades master of none inherent contradictions among ICD

approaches In McShane T Wells M (eds) Getting biodiversity projects to work towards more

effective conservation and development Columbia University Press New York pp 10ndash34

Russo R Candela G (2006) Payment of environmental services in Costa Rica evaluating impact

and possibilities Tierra Trop 2(1)1ndash13

Saacutenchez-Azofeifa A Pfaff A Robalino JA Boomhower JP (2007) Costa Ricarsquos payment for

environmental services program intention implementation and impact Conserv Biol 21

(5)1165ndash

1173Scott J (1999) Seeing like a State how certain schemes to improve the human condition have

failed Yale University Press New Haven and London

Sierra R Russman E (2006) On the ef 1047297ciency of environmental service payments a forest

conservation assessment in the Osa Peninsula Costa Rica Ecol Econ 59(1)131ndash141

Takacs D (2009) Forest Carbon Law and Property Rights Conservation International Arlington

Wells M Brandon K (1992) People and parks linking protected area management with local

communities The World Bank Washington

Wells M McShane T Dublin H OrsquoConnor S Redford K (2004) The future integrated

conservation and development projects building on what works In McShane T Wells M

(eds) Getting biodiversity projects to work towards more effective conservation and

development Columbia University Press New York pp 397ndash

419Wunder S (2005) Payments for environmental services some nuts and bolts CIFOR Occasional

Paper 42 CIFOR Bogor

Wunder S (2007) The ef 1047297ciency of payments for environmental services in tropical conservation

Conserv Biol 21(1)48ndash58

Zbinden S Lee D (2005) Paying for environmental services an analysis of participation in Costa

Ricarsquos PSA program World Dev 33(2)255ndash272




1 Introduction

Costa Rica has a rich history of regulating and experimenting with different

incentives for forestry activities and more recently for forest conservation throughthe well-known Payment for Ecosystem Services Program (PES) According to the

Forestry Act of 1996 the Costa Rican PES pays landowners for a bundle of four

ecosystem services provided by their forests CO2 1047297xation and sequestration water

conservation biodiversity protection and scenic beauty FONAFIFO (Fondo

National De Financiamiento Forestal) is the institution entrusted with managing the

PES As of 2012 FONAFIFO had awarded 11378 payment for ecosystem services

contracts in different categories more than 4500 of those are currently in force

(FONAFIFO 2012a b)

Despite the publicity the PESrsquo ef 1047297cacy in restoring Costa Ricarsquos forests remains

a contested issue but there are interesting opportunities to improve our under-

standing of the programrsquos governance Costa Ricarsquos PES is considered the 1047297rst

major payment for ecosystem services grand scheme exercise in the world and as

such it is one of the most studied (Arraigada et al 2012 Daniels et al 2010

Fletcher and Breitling 2012) However the bulk of previous research has focused

mainly on the programrsquos effectiveness to curb deforestation or help poor 1047297nqueros

(farmers) (Fletcher and Breitling 2012) Thus some scholars have been advocating

for additional research that focuses on explaining the context in which the PES

developed and is governed to better understand the programrsquos current and potential

impacts (Daniels et al 2010 Fletcher and Breitling 2012) This paper aims tobridge that gap and to provide a better contextual understanding of how Costa

Ricarsquos PES operates within the speci1047297c set of rules and institutions that govern it in

particular from the perspective of those who administer it on a daily basis In doing

so I offer some insights into the role of law in the PES and the way it functions on

the ground

2 Methods

I did 1047297eld research in Costa Rica between May and July 2012 During this time I

conducted interviews with key informants engaged in participant observation

during 1047297eld visits and conducted legal research In total I conducted 18

semi-structured interviews of 30 min to an hour In addition I held casual con-

versations on the 1047297eld with many of them during longer periods With the help of an

informant in San Joseacute head of an international NGO I prepared a list of potential

informants that had diverse experience with the PES and added others recom-

mended by some interviewees The 18 interviewees comprised mainly current andpast government of 1047297cials from the Ministry of the Environment (MINAET)

FONAFIFO and the Sistema Nacional de Areas de Conservacioacuten (SINAC) as well

as conservation NGO workers representatives from the Colegio de Ingenieros

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