A destination for dollars: nestled in Queretaro foothills, one sleepy town gives thanks to remittance fairy.

BOYE, Queretaro--Twenty years ago, a roof made of flimsy sheet metal was a sign of affluence in this dusty hamlet.

[ILLUSTRATION OMITTED]

Perched on a hill in an arid corner of Queretaro state, Boye's lands had never taken well to agriculture, and many families struggled just to put food on the table. Many of the houses were built from stone with thatched roofs.

That was before the town's men discovered the United States.

Now satellite dishes and manicured lawns decorate the homes of the privileged. Children run back and forth to school in crisp new uniforms. People have the luxury of buying meat.

And the streets are being paved with dollars.

Boye's men began leaving town in 1986, crossing the U.S. border illegally to work on farms in the U.S. South. Currently, about 450 men--of Boye's total population of 1,300--work in the United States, and the money they send home is credited with saving the town.

"We thank God they are up there," said Boye Mayor Oscar Sanchez, who was a migrant himself before taking office. "If it weren't for the remittances, I think we would have starved to death."

EXPECTING A CHECK

Hundreds of towns in Mexico are testament to the same story. Remittances made up a US$13.3 billion lifeline for Mexican families last year. Nearly one in five households receive money from family members working north of the border.

A 2002 report by the National Population Council, or Conapo, found that three out of four municipalities with high rates of migration had made strides in fighting poverty.

Mexico is now the world's second-largest receptor of remittances behind India, and the flood of migrant dollars overtook direct foreign investment here for the first time ever in 2003.

With an estimated 300,000 workers leaving Mexico every year in search of the American dollar, President Fox recently noted that remittances could soon surpass petroleum export sales as the nation's No. 1 source of income.

THE ROAD TO DEVELOPMENT

Sanchez proudly points out the new concrete road being laid in Boye thanks to dollar contributions from the town's far-away workforce.

"When state or municipal funds aren't enough--and they never are--we call up our people in the United States, and each worker will throw in for town projects," he said.

Everything from the town's well-painted library and auditorium--both new--to church maintenance has been touched by remittances, according to the mayor's office.

Migrants' dollars also have been a plus for the area economy. More money in people's pockets means more spending, and the town now boasts several family-run mini-markets, a butcher shop, and even a few small clothing stores.

Area construction workers also have more work building the new homes now found on most every street in town. Boye appears to be an exceptional community, however.

On a national level, while remittances improve living standards in poor communities, relatively little goes toward projects that directly generate wealth. A Conapo study found only 10% to 15% of remittances go toward starting up businesses or funding infrastructure projects, suggesting the migrants' dollars are more a band-aid solution for poverty than a road toward development.

The federal government is trying to encourage migrants to invest more in their communities through a project called "Three for One." Under the program, federal, state and municipal governments each match every peso migrants put toward infrastructure or businesses.

The program, which started in 2002, has had only limited success. During its first two years, migrants from 18 states contributed just over 200 million pesos. In Boye, the mayor had never even heard of the program.

In Boye and nationwide, the majority of the remittance bounty goes toward basic living expenses like food and clothes. The first thing families save for is land or building material.

THE SOUTH FLORIDA CONNECTION

Josefina Trejo's husband had just left for his second tour of duty in the fields of South Florida. There he will work picking basil, mint and other herbs on farms near West Palm Beach.

During his first trip there two years ago, Trejo's husband managed to send about US$1,000 to Boye each month as long as he had work.

After paying back the US$1,300 loan they took out to pay the coyote, or immigrant smuggler, the money was enough to support his wife, mother and four children--and to build walls for a two-room addition to their tiny unpainted home. The roof is still made of sheet metal.

"The money he sent back didn't go any further than that," said Trejo, 31.

A few blocks away, Juana Trejo, of no relation to the Josefina Trejo family, lives in a large two-story house complete with a spacious balcony while her husband works as a gardener in West Palm Beach.

[ILLUSTRATION OMITTED]

Noticeably more affluent in dress, Trejo, 38, said her family slowly built up their wealth over nearly 20 years--her husband was one of the first to head north from the small Queretaro town.

The family's 250-square-meter house has a distinct American look to it, especially in its well-groomed front yard atypical in Mexico. It's a far cry from the 16 square-meter hovel that Trejo and her husband lived in before he began tending Floridians' yards.

"Without the money my husband sent home, we'd have nothing," says Trejo.

And while the mayor claims most of the town's boys opt to follow their fathers north instead of studying beyond middle school, the wealthier Trejo's oldest son plans to complete high school.

The boy's education is an example of what could be one of the most important contributions remittances can make toward Mexico's development, said Gustavo Verduzco, a professor at the Colegio de Mexico who has studied migration and remittances for two decades.

In a recent study on Mexican agricultural workers in a Canadian guest-worker program, Verduzco found that migrants with less than five years abroad still had relatively little to show for their toils.

"But after 10 years, not only does almost everyone own a home with five rooms, their children on average complete 13 years of school," says Verdusco. "That allows for real social mobility and a more qualified workforce."

IN SEARCH OF LEGITIMACY

Remittances have also become a major political issue in Mexico, and even an important part of President Fox's foreign policy.

After Fox saw his dream of migration reform shattered by 9/11, the government concentrated on lobbying the United States to make life easier for the nation's paisanos on the other side of the Rio Bravo.

The government handed out over a million consular I.D. cards, known as matriculas, and urged banks as well as state and local governments to accept them.

The matricula's most important benefit is that--in places where it is accepted--it functions as a valid ID for undocumented migrants, allowing them to open bank accounts and send their dollars back home more cheaply via bank transfers.

GOUGED BY THE MIDDLEMAN 

Historically, companies like Western Union have dominated the money wiring business, though the recent entrance of banks as major competitors has helped bring down transfer fees. While Western Union currently charges as much as US$15 for every US$300 sent, some banks charge only US$8.

Few of Boye's migrants wire their remittances home, however. Most opt for the more traditional method of buying a money order and sending it back with neighbors returning to town.

The cost of the money order itself--usually less than US$3--is cheaper than wire transfers, but it doesn't get families around what amounts to a hidden fee: tricky exchange rates.

Currency exchange centers tend to cash money orders well below the market rates. Even in wire transfers, migrants sending their money through some institutions stand to lose as much as five cents on the dollar.

Many migrants are unaware of currency exchange gouging. Mayor Sanchez, who sent remittances home for over a decade, incredulously shrugged his shoulders when asked how much the townspeople of Boye lose sending their money home.

"Nothing," he surmised.

Mexican congressmen are at work on a solution. The recently created Lower House Subcommittee for Remittances is working on legislation that would give migrants the right to cash their checks or withdraw wire transfers in dollars, allowing them to shop around for the most competitive exchange rate.

"We need to keep their dollars from shrinking," said Dep. Francisco Moras, the chair of the remittances subcommittee.

[ILLUSTRATION OMITTED]

PULQUE AND OTHER LABOR FRUITS

Most of the year, traffic is nil on the handful of concrete roads that emanate from Boye's town square. Most of the people on the street are women and children, and they move around on foot.

The downside of living on dollars is that families usually need to be separated to earn them.

"It's especially hard for the children," said Juana Trejo.

Traffic only becomes a problem in September, but that's the happiest time of the year for most families. Every year, hundreds of men return for the town's annual fair, bringing with them their shiny new trucks and pockets full of cash.

"There's traditional Mexican rodeo and pulque (a traditional cactus wine)," Sanchez said. "And of course remittances play a big role in paying for all that."

Jason Lange is a freelance journalist based in Mexico City.

Photos by Margaret Myers

WHERE THE MONEY GOES

Top destinations for remittances from U.S. in 2003*

Michoacan            1,692.7
Jalisco              1,281.8
Guanajuato           1,211.9
State of Mexico      1,026.8
Mexico City            835.4
Puebla                 780.8
Veracruz               769.0
Guerrero               683.2
Oaxaca                 646.4
Queretaro (No. 16)     225.5
National total      13,265.50

*In billions of dollars
Source: Banco de Mexico