The study, published in 2026, focuses on VTL management in Kramatwatu District, Serang Regency. Its findings are important because Indonesian villages have greater authority to manage assets and finances under the village autonomy framework, while many local governments still depend heavily on transfers from higher levels of government.
The researchers argue that village land should not be treated merely as property recorded in an asset register. When properly managed, it can become a productive public asset capable of generating recurring economic value, supporting local development, and giving villages greater financial flexibility.
Large Land Assets, Limited Fiscal Contribution
Kramatwatu District consists of 15 villages and covers approximately 56.56 square kilometers, with a population of about 107,154 people. Its geographical characteristics include agricultural areas, coastal zones, commercial corridors, and areas surrounding industrial development.
These conditions create different opportunities for Village Treasury Land. Depending on location and physical characteristics, village land can be used for agriculture, fishponds, commercial activities, public facilities, social facilities, and other economic purposes.
The study recorded VTL data from 14 villages, with a combined area of approximately 1,465,240 square meters. Terate Village had the largest recorded area at 220,000 square meters, while Pejaten Village had the smallest at 20,228 square meters.
However, land size did not automatically translate into higher revenue.
The researchers found that the total recorded revenue from Village Treasury Land reached approximately IDR 313.05 million, with an average of about IDR 22.36 million per village. Tonjong Village recorded the highest contribution at approximately IDR 45 million, while Margatani Village recorded the lowest at around IDR 4.5 million.
The difference illustrates an important point: the economic productivity of village land depends on more than its physical size.
Terate Village, despite having the largest recorded land area, generated approximately IDR 39.72 million. Pejaten Village, with less than one-tenth of Terate's recorded area, generated approximately IDR 21 million.
Location, accessibility, land characteristics, market value, utilization arrangements, and management capacity can therefore determine whether an asset becomes financially productive.
Village Revenue Still Relies Heavily on Transfers
The limited fiscal contribution of VTL becomes even clearer in the case of Wanayasa Village.
During the 2025 fiscal year, Wanayasa recorded total village revenue of approximately IDR 1.908 billion. Revenue from village assets contributed around IDR 32.5 million, equivalent to only 1.7 percent of total revenue.
Meanwhile, transfer revenue reached approximately IDR 1.876 billion, or 98.3 percent of total village revenue.
The figures show that Village Treasury Land is already capable of generating income, but its current contribution is not large enough to fundamentally change the village's revenue structure.
For the researchers, village fiscal independence should not mean eliminating dependence on government transfers altogether. Instead, it should reflect a village's growing capacity to mobilize and manage resources under its own control.
Legal Status Remains a Major Challenge
One of the most significant obstacles identified by the study is incomplete legal documentation.
Not all Village Treasury Land has been formally certified through a Right of Use certificate registered in the name of the village government. Some parcels continue to rely on older documents such as Letter C and girik.
This situation can create risks involving ownership claims, disputes, administrative difficulties, and limitations on long-term utilization.
The researchers emphasize that legal certainty is the foundation of productive asset management. Certification alone, however, is not enough. It must be followed by appropriate valuation, contractual arrangements, investment planning, supervision, and productive utilization.
The study also found that some Village Treasury Land is located outside the current administrative boundaries of the villages that own it. Such situations are associated with territorial expansion and land-exchange arrangements related to infrastructure, industrial estates, and residential development.
Management Systems Already Exist, but Capacity Needs Strengthening
Village governments have implemented several asset-management practices, including physical inspections, boundary measurements, document verification, inventory recording, and the use of the Village Asset Management Information System.
Supervision is also conducted periodically, reportedly at least once every three months, involving village governments, district authorities, and the Serang Regency Community and Village Empowerment Office.
However, administrative systems have not automatically translated into stronger fiscal performance.
The study identified limitations in village officials' knowledge and skills in areas such as asset administration, mapping, digital asset management, negotiation, contract management, valuation, and business feasibility analysis.
This creates a gap between recording an asset and managing an asset as an economic resource.
Restu Widyo Sasongko and colleagues from IPDN emphasize that villages need officials with competencies extending beyond regulatory compliance. They also need the ability to evaluate market conditions, assess economic value, negotiate partnerships, design contracts, identify risks, and determine appropriate utilization strategies.
Environmental Conditions Also Affect Land Productivity
Village Treasury Land used for agriculture faces another challenge: environmental conditions.
The study found that flooding, seasonal drought, and declining soil fertility can reduce the productivity of agricultural land. This means that a village cannot apply a single utilization strategy to every parcel.
Agricultural land affected by flooding may require better water management or rehabilitation, while land located near commercial corridors, industrial areas, or transportation infrastructure could potentially be considered for different forms of utilization.
The researchers therefore highlight the importance of developing asset-specific strategies based on location, physical conditions, market potential, and long-term sustainability.
Village-Owned Enterprises Have Yet to Reach Their Potential
Village-Owned Enterprises (BUM Desa) could play an important role in turning Village Treasury Land into productive economic assets. In practice, however, the study found that their role remains limited.
Several Village-Owned Enterprises face constraints involving capital, human resources, managerial capacity, and business planning.
As a result, village governments continue to rely heavily on conventional rental arrangements, while more diversified business models and strategic partnerships remain limited.
The researchers suggest that villages consider various management arrangements depending on the characteristics of each asset. These may include conventional leasing, long-term leases, revenue-sharing arrangements, joint ventures, community-based management, or partnerships with private-sector actors.
The appropriate model should be selected according to economic feasibility, legal safeguards, risk allocation, and expected public benefits.
From Administrative Property to Productive Public Asset
The central message from the study is straightforward: owning village land is not the same as maximizing its value.
Legal certainty, competent village officials, standardized valuation, effective supervision, appropriate utilization, strong institutions, and viable partnerships must work together if Village Treasury Land is to make a larger contribution to Village Own-Source Revenue.
For village governments, the researchers recommend prioritizing the certification of Village Treasury Land, strengthening technical and managerial capabilities, standardizing valuation procedures, and developing utilization models suited to each asset's characteristics.
Village-Owned Enterprises should also be strengthened before being assigned a strategic role in managing village land.
With better governance and more productive utilization, Village Treasury Land could move beyond its traditional role as an administrative asset and become an important component of village economic development and financial capacity.
About the Authors
Restu Widyo Sasongko is the lead author and corresponding author of the study, affiliated with the Institut Pemerintahan Dalam Negeri (IPDN). His work in this article focuses on village governance, public asset management, village financial capacity, and fiscal independence.
Eko Budi Lestari, Eljawati, and Haromin are co-authors and are also affiliated with the Institut Pemerintahan Dalam Negeri. Their contribution to the study examines the institutional, governance, administrative, and financial dimensions of Village Treasury Land management.
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