‘American Dream’ Turns Into Nightmare at <i> El Milagro</i> : New Mexico: Rural, unincorporated area near U.S.-Mexico border is known as ‘The Miracle.’ It lacks adequate housing, roads, drainage and water and sewer systems. But such settlements have been legal.

The American dream lives on a trash-strewn hillside at the end of a rutted road in a cluster of trailers and shacks called El Milagro--”The Miracle.”

There, two families share three rooms: a two-room trailer and a dirt-floored addition with walls that stop several feet short of the ceiling.

Cooking is done on a grate balanced between cinder-blocks over an open fire on the dirt floor. Water comes from a pipe, run from a neighbor’s house, that sticks up from the ground behind the trailer. There is no bathroom--not even an outhouse. No electricity. No heat.

The four adults and three toddlers are among the most recent arrivals in one of the newest--and rawest--of communities called colonias.

Colonia--”neighborhood” in Spanish--generally means a rural, unincorporated subdivision near the U.S.-Mexico border lacking adequate housing, roads, drainage and water and sewer systems. The word has become synonymous with rural poverty along the border in New Mexico and Texas.

El Milagro’s new arrivals left their homes near Guanajuato, Mexico, in February. They came looking for a better life in this southern New Mexico farming area along the Rio Grande near Hatch, some 80 miles north of the border.

Rosa Balcazar explained through an interpreter that she, her husband and their two children came with her cousin, Guadalupe Martinez, and Guadalupe’s husband and child.

Balcazar told her story while watching her two children, ages 4 and 3, and their 2-year-old cousin play on discarded tires in the dusty yard. Martinez was hard at work scrubbing clothes on a nearby rock.

“There was nothing to eat there,” the 34-year-old woman said. “Right now there’s nothing to eat [here] either, but there’s talk there’s going to be some jobs.”

Their hopes are pinned on the nearby fields, where bright green onions are already tall enough to wave in the brisk spring winds.

Meanwhile, they’re trying to scrape together the $100 rent they pay to a relative. Neighbors have brought them some food.

“You have people living in Third World conditions, which to me is really appalling in this day and age in America,” said New Mexico Atty. Gen. Tom Udall.

Udall is suing subdividers he says used illegal lot-splitting to create El Milagro and four other New Mexico colonias in Dona Ana County.

In some cases they also used “straw buyers,” buyers in name only who fronted for them in purchases and sales, Udall contends.

“Clearly one of the motivating factors in this is greed. You have people trying to make a fast buck,” Udall said.

One developer named in the lawsuit, Ysidro Lopez, said he provided land for people who couldn’t afford it otherwise.

“A lot of them were very poor people,” said Lopez, who sold property in two colonias about 55 miles south of El Milagro. “They were real happy to go ahead and have a piece of land so they could start their dream.”

Udall contends other subdividers have taken advantage of a loophole in state law: Splitting a lot four or fewer ways is not considered subdividing, exempting the developer from rules about roads, drainage, water and waste water. And the same lots can be split again and again.

The Legislature this year tightened the law to close the loophole. Over objections from some real estate and construction interests, the new law was signed by Republican Gov. Gary Johnson--a millionaire construction company owner and political newcomer who during last year’s campaign said, “What is a colonia?”

Being a “colonia” makes a community eligible for federal funds; 92 in New Mexico have the designation. Some are long-settled mining towns, or historic communities of picturesque adobe houses, that lack adequate infrastructure.

But the colonias with the worst conditions--such as at El Milagro--have sprouted in the last 10 to 15 years.

They are concentrated in Dona Ana County, which borders Mexico and Texas, and is the fastest-growing county in the state. Jobs at U.S. wages, schools, social services, and relatively inexpensive land--at least four times cheaper in the United States than in Ciudad Juarez, Mexico, according to one study--attract immigrants. Thousands of Dona Ana County farm workers from Mexico became U.S. citizens during a federal amnesty program in the late 1980s.

Most residents in Dona Ana County’s 35 colonias are Mexican-American and poor. They are seasonal farm workers or dairy workers or construction workers or manufacturing plant employees.

Most are buying their lots--sometimes on installment contracts that don’t give them title until the payments are finished, and sometimes at interest rates of 18%.

Judy Price, the county’s community development director, said a woman seeking a mobile home permit produced as proof of land ownership a signed agreement handwritten in Spanish on a half-sheet of paper. The location description of the lot: “near the water tank in Hatch.”

Old mobile homes, trailers and travel trailers, shacks made of scrap wood or cardboard or other materials dot the colonias. Many residents use Mexican-bought butane tanks--which don’t meet U.S. standards--for heating and cooking, and sometimes electricity is run from trailer to trailer with extension cords.

In the best of weather, unimproved stretches of dirt that serve as roads to colonias keep school buses away and force slow-moving cars and trucks to pitch and yaw like ships as they navigate the craters.

In the rain, roads flood and can become impassable for emergency vehicles.

“Sal Si Puedes”--”Come Out If You Can”--residents named one of their dusty streets in Vado, a colonia south of Las Cruces within sight of Interstate 10.

Juan Arellano, a carpenter, lives at the end of a narrow lane. “I broke the two cars there,” he said, gesturing toward a Chevrolet and an Oldsmobile that have become permanent fixtures next to the Arellanos’ tidy mobile home and flower garden.

Seventy-five percent of the county’s colonias have water-distribution systems, but many are old, overburdened and inadequate, according to a 1994 county report. Other residents use wells--sometimes hand-dug--or haul water.

Fewer than 20% of colonias residents in the county are hooked up to waste-water systems. Use of illegal cesspools and unapproved septic tanks, and the practice of piping raw sewage out of trailers and directly onto the ground, threatens water supplies and residents’ health, officials say.

There have been no major outbreaks of infectious disease in the colonias.