Instead of bulldozing the favelas as they have done in the past, the local government is more inclined to upgrade the settlements and allow people to legalize their structures, because it is easier, cheaper and more humane. In some areas with steep hills and poor drainage conditions, the people are asked to relocate. The vacated areas are then used for community uses such as parks, playgrounds and soccer fields.
In 2001, a statute was established to legalize illegal settlements. Once legalized, these citizens can access social services. However the progress has been very slow. Another local initiative has been to set up a Management Information System to track the favelas. Such tracking allows effective targeting of upgrading efforts and necessary environmental clean-ups.
In spite of these efforts, there are many challenges such as lack of employment opportunities, high cost of land, lack of credit history and gang related violence. There is also a need for educational programs, skills training and investments in job creation programs.
Reference: Serpone, Bueno and Veridiana Sedeh, Improving Slums: Stories from Sao Paulo, Citiscope.org, June 29, 2011