Ebeye Solid Waste Management Project: Project ...PAM – project administration manual PIU –...

Ebeye Solid Waste Management Project (RRP RMI 53082)

Project Number: 53082-001 Grant Numbers: December 2020

Republic of the Marshall Islands: Ebeye Solid Waste

Management Project

Project Administration Manual

http://www.adb.org/Documents/RRPs/?id=53082-001-2

ABBREVIATIONS

ADB – Asian Development Bank COVID-19 – coronavirus disease DBM – design-build-manage FMIS – financial management information system KALGOV – Kwajalein Atoll Local Government MOF – Ministry of Finance, Banking and Postal

Services MWIU – Ministry of Works, Infrastructure, and Utilities O&M – operation and maintenance PAM – project administration manual PIU – project implementation unit RMI – Republic of the Marshall Islands SWM – solid waste management US – United States

CONTENTS

I. PROJECT DESCRIPTION 3

II. IMPLEMENTATION PLANS 4

A. Project Readiness Activities 4 B. Overall Project Implementation Plan 5

III. PROJECT MANAGEMENT ARRANGEMENTS 8

A. Project Implementation Organizations: Roles and Responsibilities 8 B. Key Persons Involved in Implementation 9 C. Project Organization Structure 10

IV. COSTS AND FINANCING 11

A. Cost Estimates Preparation and Revisions 11 B. Key Assumptions 11 C. Project Financing Plan 12 D. Detailed Cost Estimates by Expenditure Category 12 E. Allocation and Withdrawal of Grant Proceeds 12 F. Detailed Cost Estimates by Financier 13 G. Detailed Cost Estimates by Year 13 H. Contract and Disbursement S-Curve 14 I. Fund Flow Diagram 16

V. FINANCIAL MANAGEMENT 17

A. Financial Management Assessment 17 B. Disbursement 25 C. Accounting 25 D. Auditing and Public Disclosure 25

VI. PROCUREMENT AND CONSULTING SERVICES 26

A. Advance Contracting 26 B. Procurement of Goods, Works, and Consulting Services 27 C. Procurement Plan 27 D. Consultant’s Terms of Reference 30

VII. SAFEGUARDS 38

VIII. GENDER AND SOCIAL DIMENSIONS 39

IX. PERFORMANCE MONITORING, EVALUATION, REPORTING, AND COMMUNICATION 42

A. Project Design and Monitoring Framework 42 B. Monitoring 45 C. Evaluation 45 D. Reporting 45 E. Stakeholder Communication Strategy 46

X. ANTICORRUPTION POLICY 47

XI. ACCOUNTABILITY MECHANISM 47

XII. RECORD OF CHANGES TO THE PROJECT ADMINISTRATION MANUAL 48

Project Administration Manual Purpose and Process

The project administration manual (PAM) describes the essential administrative and management requirements to implement the project on time, within budget, and in accordance with the policies and procedures of the government and Asian Development Bank (ADB). The PAM should include references to all available templates and instructions either through linkages to relevant URLs or directly incorporated in the PAM. The Ministry of Finance, Banking and Postal Services (MOF) and Ministry of Works, Infrastructure, and Utilities (MWIU) are wholly responsible for the implementation of ADB-financed projects, as agreed jointly between the borrower and ADB, and in accordance with the policies and procedures of the government and ADB. ADB staff is responsible for supporting implementation including compliance by MOF and MWIU of their obligations and responsibilities for project implementation in accordance with ADB’s policies and procedures. At grant negotiations, the borrower and ADB agreed to the PAM and ensured consistency with the grant agreement. Such agreement was reflected in the minutes of the grant negotiations. In the event of any discrepancy or contradiction between the PAM and the grant agreement, the provisions of the grant agreement shall prevail. After ADB Board approval of the project's report and recommendations of the President (RRP), changes in implementation arrangements are subject to agreement and approval pursuant to relevant government and ADB administrative procedures (including the Project Administration Instructions) and upon such approval, they will be subsequently incorporated in the PAM.

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I. PROJECT DESCRIPTION 1. The project will establish a sustainable and effective solid waste management (SWM) system in Ebeye, the Republic of the Marshall Islands (RMI), by (i) building a high-temperature incinerator and upgrading the dump site, (ii) upgrading and replacing equipment for municipal SWM, and (iii) strengthening institutional capacity to sustain SWM services. The project will prevent the spread of transmissible diseases, including the coronavirus disease (COVID-19) and waterborne diseases, through improved medical waste disposal and strengthened medical waste management capacity. The project is aligned with the following impact: efficient, effective, resilient, sustainable and affordable services and facilities that promote sustainable economic growth provided.1 The project will have the following outcome: coverage and sustainability of integrated SWM service delivery improved in Ebeye.2 The project will deliver the following three outputs: 2. Output 1: A high-temperature incinerator constructed, and waste disposal site and recycling facility upgraded. The project will accomplish the following:

(i) Upgrade the existing dump site and construct a seawall along the site’s shoreline. The dump site will be converted to a managed landfill for installation and operation of the incinerator and disposal of the bottom ash and construction waste. Existing solid waste will be shaped into a mound and covered with a layer of material in accordance with the RMI SWM regulations. The seawall to be constructed in the western and northern part of the dump site will stop inundation and prevent solid waste from polluting the lagoon.

(ii) Construct a high-temperature incinerator capable of burning 9–13 tons a day in the landfill site using a design–build–manage contract. The incinerator will process all the municipal solid waste in Ebeye and generate bottom ash. The contractor will be responsible for the performance of the incinerator and the training of the Kwajalein Atoll Local Government (KALGOV) staff. KALGOV will undertake the daily operation and the contractor will provide remote monitoring and management. In response to COVID-19, the project will ensure that the incinerator will process hazardous medical waste and menstrual waste properly.

(iii) Construct a recycling facility house in the landfill site to store recycling equipment procured by KALGOV.

3. Output 2: Municipal solid waste collection, transport, and disposal operations improved. The project will (i) upgrade and replace vehicles and equipment for solid waste collection, transport, and disposal; and (ii) replace waste collection containers for more efficient operation. KALGOV will adopt cost-effective procurement to ensure the sustainability of vehicles and equipment, such as a multiyear maintenance and repair service agreement for the purchased equipment. In response to COVID-19, specific equipment and supplies will be procured in a timely manner for safe medical waste management, including waste classification, segregation, storage, transport, and disposal. The project will help Ebeye Hospital and its contractor strengthen the existing medical waste management system, starting from the period before construction until the operation of the incinerator, including the first 12 months of project implementation. 4. Output 3: Institutional capacity to sustain solid waste management service delivery and local engagement strengthened. The project will accomplish the following:

1 Government of the Marshall Islands. 2020. National Strategic Plan 2020–2030. Majuro. 2 The design and monitoring framework is in Chapter X.

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(i) Improve the technical capacity of KALGOV, develop and implement a waste collection and transport plan,3 develop and implement an operation plan for the managed waste landfill, and formulate and implement an asset management plan for vehicles and equipment for waste management. The asset management plan will cover operation and maintenance (O&M) of equipment and provisions to secure funding for O&M and capital equipment replacement, and build KALGOV’s capacity to implement the Container Disposal Legislation (CDL).

(ii) Improve KALGOV’s financial sustainability to maintain the services. The project will

develop and implement a gender-sensitive institutional reform plan for KALGOV, including actions to support women in leadership and/or technical positions, and help KALGOV develop and implement the SWM tariff framework. As practiced in many countries, an SMW tariff can be charged and collected with the electricity tariff, which exists in Ebeye and has a high collection ratio.

(iii) Conduct a gender-sensitive public-awareness campaign on “reduce, reuse, recycle,”

and increase public understanding of the importance of paying fees for sustainability. 5. In response to COVID-19, the project will start strengthening institutional capacities for proper handling and management of medical waste within the first 12 months of project implementation. The project will review the current medical waste management procedures, roles and responsibilities, and budget of Ebeye Hospital; develop new medical waste management procedures for the hospital; and design and implement training for the hospital staff and contractors who handle medical waste.

II. IMPLEMENTATION PLANS A. Project Readiness Activities

Table 1: Project Readiness Schedule

Indicative Activities

Months

Jul 2020

Aug 2020

Sep 2020

Oct 2020

Nov 2020

Dec 2020

Jan 2021

Responsible Individual/Unit/Agency/

Government Advance contracting actions

MWIU

Establish project implementation arrangements

MWIU

Government budget inclusion

MOF

ADB Board approval ADB Grant signing MOF, ADB Government legal opinion provided

MOF

Grant effectiveness ADB

ADB = Asian Development Bank; MOF = Ministry of Finance, Banking and Postal Services; MWIU = Ministry of Works, Infrastructure, and Utilities. Source: Asian Development Bank.

3 Collection operations to be reviewed include operational and safety procedures for collection workers. The plan

covers disaster risk management, including measures to be taken in response to inundation and overtopping.

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B. Overall Project Implementation Plan

Table 2: Overall Project Implementation Plan

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III. PROJECT MANAGEMENT ARRANGEMENTS A. Project Implementation Organizations: Roles and Responsibilities

Table 3: Project Management Roles and Responsibilities Project Implementation Organizations Management Roles and Responsibilities

Executing Agency: Ministry of Finance, Banking and Postal Services (MOF)

(i) Overall delivery of the project and reporting to the government and ADB.

(ii) Ensure compliance with financing agreement covenants. (iii) Maintain separate project account, have all project accounts

audited annually and sent to ADB. (iv) Ensure the compilation and presentation of all reporting

requirements under the project. (v) Ensure interagency coordination.

Project Implementation Unit (PIU)

(i) Responsible for day-to-day implementation of the project. (ii) Coordinate and liaise with KALGOV on the implementation of the

project and KADA to seek their technical advice (iii) Prepare overall project implementation plan and annual work

plan (iv) Prepare consultant request for proposals to comply with ADB

requirements, evaluate proposals, award, and administer contracts

(v) Prepare grant withdrawal applications (vi) Maintain project accounts and records (vii) Serve as the secretariat for the PSC (viii) Prepare reports as required during the implementation of the

project including reporting against the gender action plan (GAP), for the government and ADB

(ix) Prepare the project completion report to the government and ADB

(x) Ensure compliance with gender and safeguards requirements, including implementation of the GAP

(xi) Update the project’s environmental monitoring plan following completion of detailed design of project components

(xii) Carry out environmental assessments

Project Steering Committeea

(i) Provide strategic direction and guidance for the project (ii) Oversee and monitor all aspects of project implementation (iii) Advise government on any issues raised or concerns and

propose remedial actions

Implementing Agency: Ministry of Works, Infrastructure, and Utilities (MWIU)

(i) Responsible for the day-to-day oversight of the PIU and the administration of the project

(ii) Coordinate and liaise with KALGOV and KADA on the implementation of the project

(iii) Ensure compliance with the provisions of the grant agreements and government policies and guidelines

(iv) Procure, oversee, and administer contracts (v) Engage the community public awareness activities

ADB Monitor and review overall implementation in consultation with the MOF, MWIU, and KALGOV including: project implementation schedule; actions required with reference to the summary poverty reduction & social strategy, gender action plan and environment management plan; timeliness of budgetary allocations; project expenditures progress with procurement and disbursement,

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compliance with grant covenants; and likelihood of attaining project outputs and outcome.

ADB = Asian Development Bank; GAP = gender action plan; KADA = Kwajalein Atoll Development Authority; KALGOV = Kwajalein Atoll Local Government; MOF = Ministry of Finance, Banking and Postal Services; MWIU = Ministry of Works, Infrastructure, and Utilities; PIU = Project Implementation Unit; PSC = Project Steering Committee. a Project Steering Committee comprises: (i) Secretary of the Ministry of Finance, Banking and Postal Services –

Chair, (ii) Secretary of the Ministry of Works, Infrastructure and Utilities, representatives from (iii) the RMI Environment Protection Authority, (iv) the Kwajalein Atoll Local Government, and (v) civil society.

Source: Asian Development Bank.

B. Key Persons Involved in Implementation

Executing Agency Ministry of Finance, Banking and Postal Services

Officer’s Name Maybelline Andon Bing (Ms.) Position Secretary of Finance E-mail address [email protected] Office address P.O. Box D Majuro, MH 96960 Republic of

the Marshall Islands Asian Development Bank Urban, Water Supply and Sanitation Division Pacific Department

Officer’s Name Jingmin Huang (Ms.) Position Director Telephone No. +63 2 8632 6181 E-mail address [email protected]

Project Officer Officer’s Name Yuki Ikeda (Ms.)

Position Public Management Economist Telephone No. +63 2 8632 6515 E-mail address [email protected]

mailto:[email protected]:[email protected]:[email protected]

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C. Project Organization Structure

Ministry of Works, Infrastructure and Utilities

Government of RMI

Kwajalein Leadership

Asian Development Bank

Project Steering Committee

Project Implementation Assistance Consultants

Ministry of Finance Banking and Postal Services

Kwajalein Atoll Local Government

RMI EPA

EPA = Environmental Protection Authority, KADA = Kwajalein Atoll Development Authority, RMI = Republic of the Marshall Islands

Civil society

Project Implementation Unit

Kwajalein Atoll Development

Authority (KADA)

KADA Board

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IV. COSTS AND FINANCING

6. ADB will finance the expenditures in relation to (i) a DBM contract for a high-temperature incinerator and civil works for the improvement and rehabilitation of the dump site, (ii) materials and equipment for solid waste collection, transportation, treatment operations, and medical waste management, and (iii) consulting services for solid waste management capacity strengthening including medical waste, and awareness-raising campaign and education on solid waste management issues.

Table 4: Summary Cost Estimates ($'000)

Item Amounta Share of Total

A. Base Cost

Output 1: A high-temperature incinerator constructed, and waste disposal site and recycling facility upgraded

3,748 53.0%

Output 2: Municipal solid waste collection, transport, and disposal operations improved

736 10.4%

Output 3: Institutional capacity to sustain SWM service delivery and local engagement strengthened

1,885 26.7%

6,369 90.1%

B. Contingenciesb (on base and tax) 698 9.9% Total (A+B) 7,067 100.0%

SWM = solid waste management. a Including taxes and duties of $0.57 million. The government will finance all taxes and duties by exempting those

applicable in the Republic of the Marshall Islands. In mid-2020 prices as of 20 September 2020. b Physical contingencies computed at 9.4%. Price contingencies computed at an average of 1.7% on foreign

exchange costs and 0.8% on local currency costs. External audit costs are eligible for financing under the project. Source: Asian Development Bank estimates.

A. Cost Estimates Preparation and Revisions 7. The cost estimates for civil works, materials and equipment, consulting services for project implementation assistance and institutional strengthening were developed by ADB and consultants contracted by ADB, based on current international market rates. The cost estimates will be updated and refined continuously throughout the processing and implementation of the project based on detailed engineering design and actual contract awards. B. Key Assumptions 8. Price contingencies based on expected cumulative inflation over the implementation period are assumed to be as follows and underpin the cost estimates and financing plan.

Table 5: Escalation Rates for Price Contingency Calculation

(%) Item 2020 2021 2022 2023 2024 2025 2026 2027 Average

Foreign rate of price inflation -0.5 1.6 1.7 1.7 1.8 1.8 1.8 1.8 1.7 Domestic rate of price inflation 0.3 0.5 0.1 0.6 1.1 1.1 1.1 1.1 0.8


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C. Project Financing Plan

Table 6: Project Financing Plan

Source Amount ($'000) Share of Total (%)

Asian Development Bank Special Funds resources (Asian Development Fund grant)a 6,500 92.0

Government 567 8.0

Total 7,067 100.0 a Of the amount of $6,500,000 funded by the Asian Development Fund, $1,500,000 were funded through the corporate

pool for the coronavirus disease (COVID-19) responses. Source: Asian Development Bank estimates.

D. Detailed Cost Estimates by Expenditure Category 9. The detailed cost estimates by each expenditure category are shown in Table 7.

Table 7: Detailed Cost Estimates by Expenditure Category Item Cost

$'000 %

A. Investment Costs a

1 Civil works 3,408 48.2% 2 Equipment and materials 682 9.6% 3 Consultancy services 1,713 24.2% 4 Taxes and duties 567 8.0%

Subtotal (A): Total Base Cost

6,369 90.1%

B. Contingencies b

1 Physical

583 8.3% 2 Price

114 1.6%

Subtotal (B)

698 9.9%

Total Project Cost (A+B) 7,067 100% Note: Numbers may not sum precisely because of rounding. Percentages may not total 100%

because of rounding. a In mid-2020 prices as of 20 September 2020. b Physical contingencies computed at 9.4%. Price contingencies computed at average of

1.7% on foreign exchange costs and 0.8% on local currency costs. Source: Asian Development Bank estimates.

E. Allocation and Withdrawal of Grant Proceeds

Table 8: Allocation and Withdrawal of Grant Proceeds Number Category Amount

Allocated Percentage and Basis for Withdrawal from the Grant Account $ *

1 Goods, Works, and Services 6,500,000 100% of total expenditures claimed*

Total 6,500,000 * Exclusive of local taxes and duties within the territory of the Recipient. Source: Asian Development Bank

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F. Detailed Cost Estimates by Financier

Table 9: Detailed Cost Estimates by Financier Item Cost ADB GoRMI

$'000 $'000 % $'000 %

A. Investment Costsa

1 Civil works 3,408 3,408 100.0% - 0.0% 2 Equipment and materials 682 682 100.0% - 0.0% 3 Consultancy services 1,713 1,713 100.0% - 0.0% 4 Taxes and Dutiesb 567 - 0.0% 567 100.0%

Subtotal (A): Total Base Cost 6,369 5,802 91.1% 567 8.9%

B. Contingenciesc

1. Physical 583 583 100.0%

0.0% 2. Price 114 114 100.0%

0.0%

Subtotal (B) 698 698 100.0% - 0.0%

Total Project Cost (A+B) 7,067 6,500

567

% of Total Project Cost

92.0%

8.0%

ADB = Asian Development Bank, GoRMI = Government of RMI. Note: Numbers may not sum precisely because of rounding. Percentages may not total 100% because of rounding.

a In mid-2020 prices (as of 20 September 2020). b Financing of taxes and duties is through an GoRMI exemption. c Physical contingencies computed at 9.4%. Price contingencies computed at average of 1.7% on foreign exchange

costs and 0.8% on local currency costs; includes provision for potential exchange rate fluctuation under the assumption of a purchasing power parity exchange rate. External audit costs are eligible for financing under the project.


G. Detailed Cost Estimates by Year

Table 10: Detailed Cost Estimates by Year

Category Total 2021 2022 2023 2024 2025 2026 2027

A. Civil works 3,508 - - 634 1,931 742 50 50

B. Materials and equipment 682 - - 582 100 - - -

C. Consulting Services 1,713 - 36 395 446 369 337 130

Subtotal (A+B+C) 5,802 - 36 1,611 2,478 1,111 389 181

D. Contingencies 698 - 4 192 301 134 45 21

Total Project Cost (A+B+C+D) 6,500 - 40 1,803 2,779 1,245 432 202

% of Total Cost 100% 0.0% 0.6% 27.7% 42.8% 19.2% 6.6% 3.1%

Notes: 1. Excludes taxes and duties. 2. Numbers may not sum precisely because of rounding. Percentages may not total 100% because of rounding. Source: Asian Development Bank.

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H. Contract and Disbursement S-Curve

Figure 1: Estimated Annual Contract Awards and Disbursements S-Curve ($’000)

Year Quarter Disbursements

($’000)

Contract Awards ($’000)

Cumulative Disbursem

ents ($’000)

Cumulative Contract Awards ($’000)

2021 Q1 0 0 0 0

2021 Q2 0 0 0 0

2021 Q3 0 0 0 0

2021 Q4 0 0 0 0

2022 Q1 0 1,119 0 1,119

2022 Q2 0 280 0 1,399

2022 Q3 0 4,174 0 5,573

2022 Q4 36 0 36 5,573

2023 Q1 100 0 135 5,573

2023 Q2 72 0 207 5,573

2023 Q3 789 77 996 5,650

2023 Q4 296 0 1,292 5,650

2024 Q1 344 0 1,636 5,650

2024 Q2 571 0 2,207 5,650

2024 Q3 670 0 2,877 5,650

2024 Q4 663 0 3,540 5,650

2025 Q1 672 0 4,212 5,650

2025 Q2 644 0 4,856 5,650

2025 Q3 102 0 4,959 5,650

2025 Q4 96 0 5,055 5,650

2026 Q1 124 0 5,179 5,650

2026 Q2 107 0 5,286 5,650

2026 Q3 91 0 5,377 5,650

2026 Q4 63 0 5,440 5,650

-500

500

1500

2500

3500

4500

5500

6500

Q1

202

1

Q2

202

1

Q3

202

1

Q4

202

1

Q1

202

2

Q2

202

2

Q3

202

2

Q4

202

2

Q1

202

3

Q2

202

3

Q3

202

3

Q4

202

3

Q1

202

4

Q2

202

4

Q3

202

4

Q4

202

4

Q1

202

5

Q2

202

5

Q3

202

5

Q4

202

5

Q1

202

6

Q2

202

6

Q3

202

6

Q4

202

6

Q1

202

7

Q2

202

7

Q3

202

7

Q4

202

7

Cumulative Disbursements Cumulative Contract Awards

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Year Quarter Disbursements

($’000)

Contract Awards ($’000)

Cumulative Disbursem

ents ($’000)

Cumulative Contract Awards ($’000)

2027 Q1 91 0 5,531 5,650

2027 Q2 42 0 5,573 5,650

2027 Q3 56 0 5,630 5,650

2027 Q4 870 850 6,500 6,500

Total 6,500 6,500

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Consultant claim

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I. Fund Flow Diagram 10. The following diagram shows how the funds will flow from ADB to the contractors and consultants.

ADB

Civil Works Contractors

Consultants (and procurement)

Local contracts and Shopping

Funds flow Communication

Funds flow Fund flow

Project Implementation Unit

Financial Management Specialist Consultant

MOF

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V. FINANCIAL MANAGEMENT

A. Financial Management Assessment 11. The financial management assessment (FMA) was conducted in June–July 2020 in accordance with ADB’s Financial Management Technical Guidance Note and the Financial Due Diligence: A Methodology Note.1 The FMA considered the capacity of the Ministry of Finance, Banking and Postal Services (MOF) as the Executing Agency and MWIU as the Implementing Agency. The assessment was extended to KALGOV, the main beneficiary institution of the project, which will work closely with the Project Implementation Unit (PIU) during the project implementation and administer and maintain all the project’s outputs after the project.

1. Country Level Risks 12. The RMI’s public financial management (PFM) is based on the basic legislative framework under the RMI Code. The Code covers basic executive, legislative and judicial procedures and has a separate chapter on financial management, also referred to as the Financial Management Act of RMI. 13. In 2012, MOF conducted a public expenditure and financial accountability (PEFA) assessment of its public financial management practices and came up with a Public Financial Management Performance Report and Action Plan. No new PEFA assessment was carried out afterwards. Some of the adverse findings of the self-assessment are still practiced today. The practice of government offices to prepare the trial balance and the auditors prepare the financial statements that they audit is still being done. 14. The national government’s financial statements are prepared based on US Government Accounting Standards since they must report to the US due to substantial grant funding through the Compact of Free Association with the US. The RMI’s financial statements are audited by Deloitte. 15. The 4Gov financial management information system (FMIS) is used by the RMI. It is a windows-based modular FMIS that has been used for the past 10 years or so, and the RMI is considering the migration to a more advanced and user-friendly FMIS. The FMIS is in effect a modified double entry accounting system with receipts being posted on an actual basis when received, and with payments based on accrual accounting. The FMIS consists of several modules for accounts payable, procurement, payroll, inventory, cash receipts and budget. Reports can be produced of at any time of the budget and cumulative spending to date. The cumulative spending cannot exceed the budget. Certain modules which should be used, such as bank reconciliation and fixed assets, are not used due to the lack of knowledge on their use and the functions are being done manually, off-system, which is inefficient and error-prone. A reform coordination unit (RCU) established under ADB’s PFM project continues to provide training to MOF staff regarding budgeting and grants management. This training is designed to be user-friendly and adaptable to the current manual and 4GoV system, and to coordinate with the anticipated FMIS updates (expected in 2020).2 Implementation of the new FMIS is being supported by World Bank to ensure

1 ADB. 2009. Financial Due Diligence, A Methodology Note. Manila; and ADB. 2015. Financial Management Technical

Guidance Note. Manila. 2 ADB. 2017. Report and Recommendation of the President to the Board of Directors: Proposed Grant to the Republic

of the Marshall Islands for the Public Financial Management Project. Manila; and ADB. 2019. Report and Recommendation of the President to the Board of Directors: Proposed Grant for Additional Financing to the Republic of Marshall Islands for the Public Financial Management Project. Manila.

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effective management of public resources and improve financial reporting for management and accountability.3 16. In the MOF, the Standard Operating Procedures (SOP) were approved in 2015 by the Minister of Finance. These are specific policies, procedures and controls to be adhered to in processing transactions in accordance with best practice. A centralized public sector payroll is maintained by MOF. In addition, payments of the various government departments/ministries are also centralized at MOF. The RCU has worked to update the SOPs and has so far released the Procedures Manual on Grants and Sub-grants Management and the Embassy Imprest Accounts Manual. The manuals for Payroll Management and Fixed Assets Management are currently being finalized. The RCU established a Memorandum of Understanding (MOU) with the College of the Marshall Islands to design and launch an 8-month Government Accounting certificate course. The first cohort of 17 MOF staff successfully completed the course in June 2020. 17. Some key findings of the assessment include weakness in budget implementation and expenditure controls, low tax compliance, insufficient dissemination of information to the public, and limited accountability of government offices to act on audit findings. These weaknesses and practices may have significant impact in the financial management of the project and it is recommended that specific control measures are in place to provide assurance that funds are used for the purpose intended, and that the investment is sustainable over its useful life.

2. Entity Level Assessment

a. Ministry of Works, Infrastructure, and Utilities (MWIU) 18. MWIU has received a lot of support, both technical and financial, from donors and thus have acquired a good level of familiarity with donor requirements and processes. Working through MWIU’s Project Management Unit, and with knowledge transfer from consultants, it is expected that MWIU will continue to gain proficiency in the management of donor-funded projects. 19. Staff in MWIU, however, do not stay long in the agency unless they are occupying key positions. Accordingly, the staff that actually do the work and were trained with processes and paperwork leave their posts for higher paying jobs sometimes out of the country. 20. MWIU’s Project Management Unit manages several donor-funded projects and are already thinly stretched with the tasks required such as managing project activities, reporting to the government and coordinating with donors and government offices. Some of the identified weaknesses include lack of internal audit function, and delays in the submission of independent audit reports. Independent audit is being done by external auditors and signed off by the Office of the Auditor General which also conducts audit for whole of government accounts.

b. Kwajalein Atoll Local Government (KALGOV) 21. KALGOV is the main beneficiary institution of the project. A financial management assessment was conducted for KALGOV to assess its capacity to perform its role under the project. While it is envisaged that no funds will be channeled through KALGOV during implementation of the project, it is also imperative that KALGOV would provide counterpart resources in kind such as availability of its staff to provide inputs to the project team and to the project implementation assistance consultant and financial management specialist (consultant)

3 World Bank Group. 2018. Project Appraisal Document. Republic of the Marshall Islands (P163131): Project to

Strengthen Budget Execution and Financial Reporting Systems. Washington D.C.

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who will be based in KALGOV to oversee project implementation for the Ebeye project. Institutional weaknesses of KALGOV include lack of qualified finance staff, absence of internal audit functions and delays in the submission of independent audit report. Independent audit is conducted by external auditors and signed off by the Office of the Auditor General, which also conducts audit for the entire RMI government. KALGOV’s last independent audit was conducted in fiscal year 2016. 22. Budgets. KALGOV prepares its budgets around an estimate of funds it will generate from local taxes and fees. The process involves the preparation of budget proposals from the various departments which are consolidated and presented to the local government management. The budget is not complicated and easy to implement but the efficiency in the collection of local tax and other fees is the key problem especially if the revenues are not sufficient for the operational expenses of the local government. 23. Accounting and reporting. KALGOV uses the manual method of accounting for its transactions. The FMIS has been installed in the staff’s computer but does not integrate into the server, so each computer performs its function but are not consolidated for reporting purposes, and for preparation of financial statements. Accounts are manually consolidated to prepare the trial balance. As practiced at the national level, the auditors prepare the financial statements and conducts the audit thereafter. Based on the review of the past 5 years’ financial records, internal control weaknesses have been identified in the recording and reporting of financial transactions in KALGOV. This is attributed to inadequate internal control policies and procedures, weak FMIS, and lack of qualified financial staff. 24. Organization. The Finance Department is headed by an expatriate finance director. There are four revenue officers and seven others doing minor tasks such as filing and messenger duties. Except for the finance director, none of these support staff have accounting qualification. There were also no actions done to rationalize the composition of the finance team. 25. Internal and external audit. There is no internal audit function and there is no plan to set up a similar unit in the future. The external auditor for the entire country and various local government offices is Deloitte. Audit reports are not submitted on time and there is limited scrutiny of audit findings which are submitted to local government leadership. Since 2016, there has been no audit undertaken on the agency. 26. Asset management. Asset management systems are not properly implemented. Vehicles are insured but other assets have no insurance coverage. There is a simple depreciation policy being used for charging the expenditure. However, the local government unit does not set aside provisions for future replacement of assets. There is minimal allocation for repairs and maintenance of assets (mainly vehicles). Buildings and other equipment are not insured, and minimal repairs are being done. 27. Internal control policies. There is a lack of internal control policies and procedures governing proper monitoring, accurate reporting. The effect of this condition is potential misstatement of financial condition, and noncompliance with KALGOV policies.

3. Risk Assessment 28. The risk assessment considered the staffing, internal control, accounting and reporting policies and procedures, and auditing standards and arrangements of MWIU. Based on the assessment, the overall financial management pre-mitigation risk is high. The risks and mitigation measures are summarized as follows.

20

Table 11: Financial Management, Internal Control, Risk Assessment

Risks Considered Risk Level

Without Mitigation

Risk Management Measures

1. Country-specific risks:

Weak predictability and control in budget implementation and expenditure; limited accountability of government offices to act on audit findings.

Substantial

ADB will continue to support the RMI’s effort to improve public financial management through an ongoing project.a

2. Entity specific risks:

• Lack of financial management capacity to assist the PIU

• Staffing: Difficulties in finding qualified and experienced financial staff members familiar with ADB project financial management and loan disbursement procedures.

• Internal Audit Inadequate capacity in the internal audit department of MWIU, which may result in greater risk of fraud and corruption

• Accounting policies and procedures for the project are inadequate. Account and bank reconciliations are not performed in a timely manner.

High

High

High

High

• The project includes the contracting of a financial management specialist for project financial management. The financial management roles and responsibilities of MWIU and the PIU are clear, as indicated in the project documents.

• A highly experienced financial specialist recruited under the project readiness financingb will start working on the project within 3 months of grant effectiveness.

• MWIU and PIU will receive training and capacity building in financial management and ADB disbursement and financial management requirements, where necessary.

• There is no internal audit department in MWIU to conduct tests of internal control processes. MOF will be requested to extend this function to the PIU.

• A financial management specialist will be posted to the PIU to ensure proper recording of transactions, records keeping, reconciliations, and financial statement preparation.

Overall Inherent Risk: Substantial

3. Implementation delays and cost overruns

• Logistics and price surges of materials are beyond projections due to the COVID-19 pandemic, which might result in cost overruns and delays in project implementation

Moderate

• A 7-year implementation period and sufficient contingencies (11% of base costs) will cover unexpected time and cost overruns. The project consultant teams will train MWIU and PIU staff members in project and contract management and safeguards. Health and safety protocols will be adopted by all contractors to protect workers from contagious diseases such as COVID-19.

4. Fund flow:

• A separate account will be maintained for activities financed by the project and will be

21


Without Mitigation


• Limited understanding of and adherence to ADB disbursement requirements and procedures and late preparation of withdrawal applications can cause delays in release of funds.

Low audited by the external auditor each year. Direct payment procedures will be adopted for major contracts. Funds will not be handled directly by KALGOV.

5. Asset management and O&M:

• Asset management systems and allocation of budget for O&M are inadequate and not implemented.

• Delays in setting up solid waste tariff policy pose a high risk to financial and operational sustainability

High

High

• The project financial specialist consultant will set up and implement an asset management plan and system; the consultant will train and support relevant KALGOV staff members.

• Ensure O&M allocation for project assets based on asset management policy and system (e.g., lapsing schedule, based on useful lives of assets)

• Ensure budget provision of insurance of assets based on asset policy and system

• The project includes support for policy dialogue of the solid waste tariff policy. The consultant teams will help KALGOV to set up a tariff structure and policy to achieve partially O&M cost recovery. The government will ensure that KALGOV has sufficient funds to cover O&M costs by either necessary tariff or budget allocation

6. External Audit:

• Noncompliance with accounting regulations and financial covenants

• Late submission of audited annual project accounts to ADB.

Low

Moderate

• Independent external auditors acceptable to ADB and the Government will be appointed by the project to audit the project accounts and compliance with financial covenants on an annual basis

• Project financial statements and audit reports will be submitted to ADB, who will retain the right to query the auditors.

7. Reporting and Monitoring:

• Financial reports are not suitable for user needs and does not meet ADB requirements.

Moderate

• The PIU financial management specialist will assist MWIU to prepare comprehensive progress reports (including financial progress) to ADB on a quarterly basis showing funds were used for the intended purpose

• Financial reporting will comply with ADB and MOF requirements.

22


Without Mitigation


8. Procurement:

• Lack of awareness of ADB’s procurement procedures will increase the risk of fraud and corruption.

High

• The PIU will be supported by a procurement specialist trained in ADB procedures; anti-fraud and anticorruption clauses will be included in procurement documents.

• ADB will conduct training in ADB procurement procedures.

Overall Control Risk Assessment: High

Overall (Combined) Risk: High ADB = Asian Development Bank; COVID-19 = coronavirus disease; KALGOV = Kwajalein Atoll Local Government; MOF = Ministry of Finance, Banking and Postal Services; MWIU = Ministry of Works, Infrastructure, and Utilities; O&M = operation and maintenance; PFM = public financial management; PIU = Project Implementation Unit; RMI = Republic of the Marshall Islands. a ADB. 2017. Report and Recommendation of the President to the Board of Directors: Proposed Grant to the Republic

of the Marshall Islands for the Public Financial Management Project. Manila. b ADB. 2020. Project Readiness Financing Report: Proposed Grant to the Republic of the Marshall Islands for

Preparing Urban Service Improvement Projects. Manila. Source: Asian Development Bank.

29. The overall financial management risk assessment of the project at appraisal stage is high. The identified risks in financial management is substantial and thus proper financial management documentation and identified risk mitigation measures will be undertaken during project implementation.

4. Proposed Action Plan 30. The proposed action plan for the project is as follows:

Table 12. Proposed Time-bound Action Plan: KALGOV Time-bound Action Plan

Weakness Mitigation Actions Responsibility Timeframe

Staffing - Limited

qualified financial staff

resources

Review structure and

functions of financial

department of

KALGOV, recruit

qualified financial

management specialist

Implementing agency

and ADB

- A financial management

specialist recruited under the

project readiness financinga

start working on the project

within 3 months of grant

effectiveness.

- With support from the PRF

financial management

specialist and a financial

management specialist to be

recruited under the

investment project, KALGOV

will review its finance

department functions, staffing

levels and recommend

improvements (e.g.,

rationalization) by year 2

23

Time-bound Action Plan

Weakness Mitigation Actions Responsibility Timeframe

- Training will be provided by the consultants and ADB to KALGOV finance staff, as necessary.

Accounting policies

and processes -

weakness in internal

control would allow for

misuse of resources.

A comprehensive

review of KALGOV’s

financial management

and internal control

processes will be

conducted by the

financial specialist

(consultant). Improved

internal control

systems will be

recommended and

implemented.

Implementing

Agency and ADB

The financial management

specialists (PRF, project) will

conduct a review of accounting

policies, and install improved

financial management system

by year 2.

Asset management –

Absence of asset

management policy

plan, and system,

weak control over

asset inventory can

lead to theft or

misappropriation, and

lessen the useful life of

the assets.

Introduce asset management system

over issue and utilization, physical verification and

reconciliation.

Implementing Agency

and KALGOV

- The project financial management specialist to formulate an asset management policy and plan for KALGOV/project, that will put in place mandatory insurance coverage, depreciation/capitalization policy, provision of funds for asset replacement by year 3.

- The project financial

management specialist to

develop and install asset

management system by

year 3 of project

implementation (e.g., fixed

asset register, perform

periodic/annual inventory of

capital assets).

- In accordance with the

asset management plan,

KALGOV shall undertake

regular and periodic

maintenance of the project

facilities and make

adequate resources

available, through

budgetary allocations or

otherwise, for the O&M of

the project facilities.

24

Funds flow – weak financial management system and internal controls in KALGOV result in absence of adequate financial reporting, accountability and governance

Direct payment to

suppliers and

consultants

Implementing agency

and ADB

ADB's direct payment will be

adopted to pay ADB's share of

project costs. Project

accounting will be established

by the PRF financial

management specialist by the

6th month of implementation.

Auditing – KALGOV does not conduct regular financial audits

External auditor

acceptable to ADB will

be recruited and

funded by the project

Implementing agency

and ADB

- MOF should ensure timely

submission of annual

audited financial statements

as stipulated in the grant

agreement.

- External auditor to be

contracted by year 2 of

grant effectiveness

Regulatory compliance-lack of regulatory compliance in payment of taxes and social security results in extraordinary debts incurred

Through timely

financial and

performance reporting

by KALGOV, financial

specialist will ensure

compliance with

regulations (e.g.,

taxes, social security)

Implementing agency

and KALGOV

Annual audited financial

reports will ensure annual

compliance with income tax

(RepMar Income Tax 1989),

Social Security Act of 1990,

and other regulations

ADB = Asian Development Bank, KALGOV = Kwajalein Atoll Local Government, MOF = Ministry of Finance, Banking and Postal Services, O&M = operation and maintenance, PRF = project readiness financing, RepMar = Republic of the Marshall Islands. a ADB. 2020. Project Readiness Financing Report: Proposed Grant to the Republic of the Marshall Islands for

Preparing Urban Service Improvement Projects. Manila. Source: Asian Development Bank.

5. Conclusion

31. The financial management pre-mitigation risk of MWIU is assessed as high. Limited staff resources and lack of an internal audit capacity are considered the key risks for the implementation of the project. To mitigate these risks, a dedicated PIU will be established for the day-to-day implementation and management of the project. Individual consultants, funded by the project, will be recruited to staff the PIU. The PIU will be composed of the Secretary of MWIU as the PIU Head, a project implementation assistance consultant, a financial management specialist, and a construction monitoring consultant. MWIU may allocate additional personnel to the PIU from its staff complement on a needs and availability basis. 32. Audit arrangements will be emphasized during project implementation and timeliness of submission made clear during grant negotiation. The financial management specialist will monitor the use of project resources. An external auditor will be recruited to audit the project accounts. The costs for the external auditor are eligible for financing under the project. It is highly recommended that staff from MWIU are delegated to the PIU to take advantage of opportunities for learning. To ensure project sustainability, the government shall undertake regular and periodic maintenance of the project facilities in accordance with the asset management plan prepared for the project, and make adequate resources available, through budgetary allocations or otherwise, for the O&M of the project facilities.

25

33. KALGOV, the main beneficiary institution of the project, has substantially weak financial management systems. Strengthening measures to improve their financial management processes will be undertaken as part of SWM training. The PIU consultants, who will work at KALGOV, should allow for the required level of coordination with KALGOV to implement project activities. Direct payment will be used as disbursement procedure and no funds will flow through the KALGOV. B. Disbursement 34. The grant proceeds will be disbursed in accordance with ADB’s Loan Disbursement Handbook (2017, as amended from time to time)4, and detailed arrangements agreed upon between the government and ADB. Online training for project staff on disbursement policies and procedures is available.5 Project staff are encouraged to avail of this training to help ensure efficient disbursement and fiduciary control. 35. Direct payment and reimbursement procedures will be used for disbursements under the project. PIU will be responsible for: (i) collecting supporting documents, and (ii) preparing and sending withdrawal applications to ADB. As the PIU Head, the Secretary of MWIU will certify all eligible payments (invoices and progress claims). 36. Before submitting the first withdrawal application, the government should submit to ADB sufficient evidence of the authority of the person who will sign the withdrawal applications on behalf of the government, together with the authenticated specimen signatures of each authorized person. The minimum value per withdrawal application is stipulated in ADB’s Loan Disbursement Handbook. Individual payments below such amount should be paid by the MOF and MWIU and subsequently claimed from ADB through reimbursement unless otherwise accepted by ADB. The borrower should ensure sufficient category and contract balances before requesting disbursements. Use of ADB’s Client Portal for Disbursements system is encouraged for submission of withdrawal applications to ADB.6 C. Accounting 37. MOF will cause the PIU to maintain separate project accounts and records by funding source for all expenditures incurred on the project, following cash-based accounting. Project accounts will follow the Government Accounting Standards of the United States. D. Auditing and Public Disclosure 38. The MOF will cause the detailed project financial statements to be audited in accordance with the Government Accounting Standards of the United States by an independent auditor acceptable to ADB. The audited project financial statements together with the auditor’s opinion will be presented in the English language to ADB within 6 months from the end of the fiscal year by the MOF. 39. The audit report for the project financial statements will include a management letter and auditor’s opinions, which cover (i) whether the project financial statements present an accurate

4 The handbook is available electronically from the ADB website http://www.adb.org/documents/loan-disbursement-

handbook 5 Disbursement eLearning. http://wpqr4.adb.org/disbursement_elearning 6 ADB’s Client Portal for Disbursements system facilitates online submission of withdrawal applications to ADB,

resulting in faster disbursement. The forms to be completed by the borrower are available at ADB. Guide to the Client Portal for Disbursements.

http://wpqr4.adb.org/disbursement_elearninghttps://www.adb.org/documents/client-portal-disbursements-guidehttps://www.adb.org/documents/client-portal-disbursements-guide

26

and fair view or are presented fairly, in all material respects, in accordance with the applicable financial reporting standards; (ii) whether the proceeds of the grant were used only for the purpose(s) of the project; and (iii) whether the borrower or executing agency was in compliance with the financial covenants contained in the legal agreements (where applicable). 40. Compliance with financial reporting and auditing requirements will be monitored by review missions and during normal program supervision, and followed up regularly with all concerned, including the external auditor. 41. The government, MOF and MWIU have been made aware of ADB’s approach to delayed submission, and the requirements for satisfactory and acceptable quality of the audited project financial statements.7 ADB reserves the right to require a change in the auditor (in a manner consistent with the constitution of the borrower), or for additional support to be provided to the auditor, if the audits required are not conducted in a manner satisfactory to ADB, or if the audits are substantially delayed. ADB reserves the right to verify the project's financial accounts to confirm that the share of ADB’s financing is used in accordance with ADB’s policies and procedures. 42. Public disclosure of the audited project financial statements, including the auditor’s opinion on the project financial statements, will be guided by ADB’s Access to Information Policy 2018.8 After the review, ADB will disclose the audited project financial statements and the opinion of the auditors on the project financial statements no later than 14 days of ADB’s confirmation of their acceptability by posting them on ADB’s website. The management letter, additional auditor’s opinions, and audited entity financial statements will not be disclosed.9

VI. PROCUREMENT AND CONSULTING SERVICES

A. Advance Contracting 43. All advance contracting will be undertaken in conformity with ADB Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time). The issuance of invitations to bid under advance contracting will be subject to ADB approval. The borrower, MOF, and MWIU been advised that approval of advance contracting does not commit ADB to finance the project. 44. Advance contracting. Advance contracting will be carried out for works, goods, and consulting services.

7 ADB’s approach and procedures regarding delayed submission of audited project financial statements:

(i) When audited project financial statements are not received by the due date, ADB will write to the executing agency advising that (a) the audit documents are overdue; and (b) if they are not received within the next 6 months, requests for new contract awards and disbursement such as new replenishment of advance accounts, processing of new reimbursement, and issuance of new commitment letters will not be processed.

(ii) When audited project financial statements are not received within 6 months after the due date, ADB will withhold processing of requests for new contract awards and disbursement such as new replenishment of advance accounts, processing of new reimbursement, and issuance of new commitment letters. ADB will (a) inform the executing agency of ADB’s actions; and (b) advise that the grant may be suspended if the audit documents are not received within the next 6 months.

(iii) When audited project financial statements are not received within 12 months after the due date, ADB may suspend the grant.

8 ADB. 2018. Access to Information Policy. 9 This type of information would generally fall under access to information policy exceptions to disclosure. ADB. 2018.

Access to Information Policy. Paragraph 17, 4 (viii).

https://www.adb.org/documents/access-information-policyhttps://www.adb.org/documents/access-information-policy

27

B. Procurement of Goods, Works, and Consulting Services 45. All procurement of goods and works will be undertaken in accordance with ADB’s Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time). 46. Open competitive bidding procedure will be used for all civil works contracts. 47. An 18-month procurement plan indicating threshold and review procedures, goods, works, and consulting services contract packages is in Section C. 48. All consultants will be recruited in accordance with ADB’s Procurement Policy (2017, as amended from time to time) and Procurement Regulations for ADB Borrowers (2017, as amended from time to time). The terms of reference of all consulting services are detailed in Section D. C. Procurement Plan

Basic Data Project Name: Ebeye Solid Waste Management Project

Project Number: 53082-001 Approval Number:

Country:Republic of the Marshall Islands Executing Agency: Ministry of Finance, Banking and Postal Services

Project Procurement Classification: A Implementing Agency: Ministry of Works, Infrastructure, and Utilities

Procurement Risk: High

Project Financing Amount: $7.07 million ADB Financing: $6.50 million Non-ADB Financing: $0.57 million (government in-kind)

Project Closing Date: 31 December 2027

Date of First Procurement Plan: Date of this Procurement Plan: 16 August 2020 Procurement Plan Duration (in month): 18 Advance contracting:

No e-GP: No

A. Methods, Review and Procurement Plan

1. Procurement and Consulting Methods

49. Except as the Asian Development Bank (ADB) may otherwise agree, the following methods shall apply to procurement of goods, works, nonconsulting services, and consulting services.

Procurement of Goods and Works

Open Competitive Bidding (OCB) for Works With international advertisement for the DBM contract for a thermal treatment plant (incinerator) and civil works at the current dump site

Request for Quotation for Goods For supply of vehicles and equipment

Consulting Services

Quality- and Cost-Based Selection for Consulting Firm Quality-Cost Ratio 90:10

Individual Consultant Selection With international advertisement in ADB’s CMS for selecting individual consultants

ADB = Asian Development Bank, CMS = Consultant Management System, DBM = design-build-manage, OCB = open competitive bidding.

28

2. List of Active Procurement Packages (Contracts) 50. The following table lists goods, works, nonconsulting, and consulting services contracts for which the procurement activity is either ongoing or expected to commence within the procurement plan’s duration.

Goods and Works

Package Number

General Description

Estimated Value

Procurement Method

Review

Bidding Procedure

Advertisement Date

(quarter/year) Comments

W1 Output 1 DBM contract for a thermal treatment plant (incinerator)

$2,150,000 Open Competitive

Bidding (OCB)

Prior 1S1E Q4 2021 (a) Advertising: international

(b) Bidding Document-Design-Build-Operate

(c) Domestic

Preference Applicable: No

W2 Output 1 Civil works at the current dump site

$1,257,500 Open Competitive

Bidding (OCB)

Prior 1S1E Q4 2021 (a) Advertising: national

(b) Bidding Document-Small Works

E1 Output 2 Wheelie bins and wheeled containers

$238,000 Request for Quotations

Prior RFQ N/A Wheelie bins (240 l) and wheeled containers (1.1 m3)

E2 Output 2 Compactor truck including spare parts and training


Prior RFQ N/A Compactor truck (8m3)

E3 Output 2 Compact track loader with and spare parts and equipment for maintenance


Prior RFQ N/A

E4 Output 2 Medical waste equipment


Prior RFQ N/A

DBM = design-build-manage.

Consulting Services

Package Number

General Description

Estimated Value

Selection Method

Review Type of

Proposal

Advertisement Date


C1 Output 3 Project Implementation Assistance Consultant/Solid Waste Management Specialist

$398,700 ICS Prior EOI Q3 2021 • Type: Individual • International. • 18 person-months

intermittent

C2 Output 3 Financial Management Specialist

$305,580 ICS Prior EOI Q3 2021 • Type: Individual • International. • 18 person-

months, intermittent

29

Consulting Services

Package Number

General Description

Estimated Value

Selection Method

Review Type of

Proposal

Advertisement Date


C3 Output 3 Construction Monitoring Consultant

$156,200 ICS Prior EOI Q4 2021 • Type: Individual • National. • 22 person-


C4 Output 3 Community Engagement Specialist / cSafeguards Specialist



C5 Output 3 Environment Specialist

$152,000 ICS Prior EOI Q4 2021 • Type: Individual • International. • 6 person-months,

intermittent

C8 Output 3 Medical waste management/health specialist


months, intermittent.

C6 Output 3 Community Engagement Officer

$85,200 ICS Prior EOI Q2 2022 • 12 person-months intermittent

• Type: Individual

• Assignment: national

• Expertise: Community engagement

• Advance Contracting: No

C7 Output 3 Local NGO for outreach campaign

$77,000 QCBS Prior BTP Q1 2023 • Type: NGO

• Assignment: National

• Expertise: Community outreach

• Advance Contracting: No

• Quality-Cost Ratio 90:10

ICS = individual consultant selection.

3. List of Indicative Packages (Contracts) Required under the Project

51. The following table lists goods, works, nonconsulting, and consulting services contracts for which the procurement activity is expected to commence beyond the procurement plan duration and over the life of the project (i.e. those expected beyond the current procurement plan’s duration).

Goods and Works

Package Number

General Description

Estimated Value ($)

Procurement Method

Review Bidding

Procedure Comments

Nil

Consulting Service

30

Package Number

General Description

Estimated Value ($)

Selection Method

Review Type of

Proposal Comments

Nil

4. List of Awarded and Completed Contracts

52. The following table lists the awarded contracts and completed contracts for goods, works, nonconsulting, and consulting services .

Goods and Works

Package Number

General Description

Contract Value

Date of ADB Approval of Contract Award10

Date of Completion

Comments11

Nil

Consulting Service

Package Number

General Description

Contract Value

Date of ADB Approval of Contract Award10

Date of Completion

Comments12

Nil

5. Non-ADB Financing 53. The following table lists goods, works and consulting services contracts over the life of the project, financed by non-ADB sources.

Goods and Works

General Description Estimated Value (cumulative, $)

Estimated Number of Contracts

Procurement Method

Comments

Nil

Consulting Service

General Description Estimated Value (cumulative, $)

Estimated Number of Contracts

Recruitment Method

Comments

Nil

D. Consultant’s Terms of Reference

1. Project Implementation Assistance Consultant/Solid Waste Management Specialist (International, 18 person-months, intermittent)

54. The Project Implementation Assistance Consultant/Solid Waste Management Specialist will assist the Ministry of Works, Infrastructure, and Utilities (MWIU) to deliver the project outputs and assist the Kwajalein Atoll Local Government (KALGOV) to strengthen the planning and delivery of effective solid waste management services. The consultant will work at KALGOV in Ebeye, RMI, to deliver the assignment including substantial on-the-job training to KALGOV’s solid waste management department. The consultant will report to the PIU Head and the City Manager of the Kwajalein Atoll. 55. Roles of the consultant. Roles of the consultant will include (but not be limited to):

(i) Project Output 1: A high-temperature incinerator constructed, and waste disposal site and recycling facility upgraded. Assisting MWIU to procure and implement works to:

31

(a) construct a 9–13-ton/day high-temperature incinerator using the design-build-management contract;

(b) reorganize the existing dump site as the waste treatment site for the operation of the incinerator and the disposal of bottom ash;

(c) construct seawalls along the western and northern shorelines of the site; and

(d) to store recycling equipment procured by KALGOV, construct a recycling facility within the site.

(ii) Project Output 2: Municipal solid waste collection, transport, and disposal

operations improved. Assisting MWIU to procure: (a) vehicles and equipment for waste collection, transportation, and disposal

operations; (b) waste collection bins and containers; and (c) equipment for medical waste management.

(iii) Project Output 3: Institutional capacity to sustain SWM service delivery and

local engagement strengthened. Assisting KALGOV to design and implement the following activities: (a) Solid waste management operation plan; (b) Financial and human resources management reforms (in collaboration with

the Financial Management Specialist); (c) Fee collection system and deposit-refund system for beverage containers

reforms (in collaboration with the Financial Management Specialist); (d) Awareness raising campaign (in collaboration with the Gender and

Safeguards Specialist); and (e) Medical waste management plan for the Ebeye Hospital and KALGOV (in

collaboration with the Medical Waste Management Specialist).

(iv) Project administration and monitoring. Assisting MWIU to:

(a) review and update the Project Administration Manual (PAM) including, but not limited to, the project implementation schedule and the project procurement plan within 3 months of initial fielding of the consultant and thereafter annually. Copies of the updated PAM shall be provided to the PIU Head and the ADB project officer;

(b) ensure all contractors and consultants comply with the laws of RMI, ADB’s

Safeguard Policy Statement, and ADB’s Anticorruption Policy; (c) prepare quarterly progress reports in a format to be agreed by the Ministry

of Finance, Banking and Postal Services (MOF), MWIU, KALGOV, the PIU, and ADB;

(d) prepare consolidated annual reports including

- progress achieved by output as measured through the indicator's performance targets; - key implementation issues and solutions; - updated procurement plan; - updated implementation plan for the next 12 months;

32

(e) prepare the contract completion reports satisfactory to the Government of RMI and ADB, and ensure as-built data, such as as-built drawings, equipment O&M manuals, and guarantees, are collected and collated at the completion of each contract;

(f) provide other services to the PIU Head as necessary to deliver the project.

With the Financial Management Specialist,

(g) establish and maintain separate project accounts and records by funding source for all expenditures incurred on the project. Project accounts will follow international accounting principles and practices. The project accounts will be audited annually by an external auditor appointed by the MOF;

(h) prepare draft grant withdrawal applications for the payment of eligible

project costs. Submit the draft withdrawal applications to the MOF for verification and sign-off by authorized signatories; and

With the Environmental Specialist,

(i) Ensure that appropriate studies are undertaken to assess the climate risk, and assess how this risk will change with climate change, and ensure that the design of all infrastructure and all operations fully take into account the climate hazards and projected climate change.

(v) Contract administration. Assisting MWIU to:

(a) administer subproject contracts including processing of progress certificates, review of extension of time claims, preparation of change orders and nonconformance notices, subproject implementation progress monitoring, and subproject cost monitoring;

(b) provide effective and regular supervision of the works. Supervise quality

control tests to ensure that the works are executed in accordance with established standards, criteria, specifications, procedures, and approved design and environmental aspects in compliance with the environmental management and monitoring plan and the construction schedule;

(c) review the design and construction contractor’s drawings and calculations

to check arrangements for optimized O&M and verify compliance with contract specifications;

(d) assist in observation and testing of materials and equipment; (e) supervise and evaluate the implementation of environmental mitigation and

monitoring measures as specified in the environmental management plan (EMP). This includes undertaking the environmental monitoring audits as prescribed;

(f) review the equipment manufacturers’ drawings and calculations to check

arrangements for optimized O&M and verify compliance with contract specifications;

33

(g) review the procurement and delivery program for each supply contract financed under the project to ensure compatibility and timely coordination with other contracts and civil works;

(h) develop and implement applicable procedures required to ensure adequate

control of manufacturing, factory tests, delivery, and acceptance of materials and equipment. Assist with the unpacking and checking of the materials and equipment, follow up on the delivery of delayed components, and make claims;

(i) help review proposals for equipment commissioning tests and trial

operation plans. (j) respond to contractor requests for information in all matters related to

interpreting contract documents, ground survey controls, quality control testing, and other matters relating to the contract under the project;

(k) maintain a permanent record of all quantities for payment and test results; (l) identify potential risks to MWIU and the Government of RMI in the

implementation of contracts, including cost over-runs, delays, and nonconformance with project specifications;

(m) where necessary, coordinate design changes to achieve to-time and to-

budget subproject delivery. Prepare change orders, and assist the project manager to negotiate with the contractor to implement the changes;

(n) update the EMP as necessary, including carrying out supplemental

environmental assessments for additional subprojects appraised after grant approval; and

(o) Monitor and supervise resettlement and other social impact mitigation

activities. 56. Qualifications and experience. The qualifications and experience required for the consultant are outlined below. 57. The Project Implementation Assistance Consultant/Solid Waste Management Specialist will have a degree in civil engineering and have at least 15 years demonstrated experience in planning, designing and implementing urban infrastructure projects including at least 10 years in planning, designing and implementing solid waste management projects. Knowledge of ADB procurement and reporting procedures and small developing nation experience is essential. The consultant must also have at 10 years demonstrated experience in managing multi-disciplinary teams. The consultant will report to the PIU Head and assist the PIU Head with the day-to-day management of the project. The consultant will assist the PIU Head to administer and oversee the project’s construction contracts.

2. Financial Management Specialist (International, 18 person-months, intermittent)

58. The financial management specialist will strengthen financial management capacity of KALGOV and assist the PIU Head as a member of the PIU to establish and maintain the project

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accounts and to prepare the financial documentation. The Financial Management Specialist will work at KALGOV in Ebeye, RMI and report to The Financial Management Advisor will report to the PIU Head and the City Manager of the Kwajalein Atoll. Specific tasks and responsibilities of the financial management specialist will include:

(i) Review current revenue collection, receipting, and banking procedures; implement

strengthened internal financial control procedures as required and train KALGOV staff thoroughly in their use and ensure that the procedures are fully implemented;

(ii) Review financial management and financial record keeping procedures of KALGOV. Prepare guidelines for financial record management and monitor the implementation of the guidelines.

(iii) Review the current financial accounting and reporting tools (including adequacy of software and computer hardware) used at KALGOV and design and implement improved procedures, including establishing and monitoring financial indicators, as required;

(iv) Assist MWSC to establish and maintain separate project accounts and records for all expenditures incurred under the project. Conduct periodic (at least semi-annually) internal audits of the project accounts.

(v) Assist KALGOV to prepare annual project financial statements for external auditing. Facilitate the annual external audits to ensure that the externa audit is completed and annual audited project are submitted to ADB not later than 6 months after the end of each fiscal year.

(vi) Assist MWSC to prepare and submit project grant withdrawal applications and associated documentation to ADB.

(vii) Monitor the project grant financial activities project. Review the project accounts quarterly and identify project financial risks and recommend corrective actions to ensure the project accounts follow international accounting principles and practices.

(viii) Assist KALGOV to prepare an action plan to progressively enhance their financial and operating systems;

(ix) Support KALGOV implement a new fee charging system (to be developed under the Project Readiness Financing) to KALGOV for their solid waste management services to ensure KALGOV’s financial sustainability.

59. The Financial Management Advisor will have a degree in accounting, finance, or a related field, and will have a recognized professional accountancy qualification and at least 10 years’ experience in financial management including capacity development of accounting staff and preferably including experience in utility financial management.

3. Construction Monitoring Consultant (National, 22 person-months, intermittent)

60. The Construction Monitoring Consultant will oversee and monitor the construction activities and the equipment procurement to ensure that execution of activities is completed within time and budget. The Consultant will work closely and report to the Project Implementation Assistance Consultant /Solid Waste Management Specialist and the ADB project team to ensure efficient project implementation. 61. The Consultant will

(i) assist KALGOV with all project procurement activities including issuing bidding documents, responding to bidder requests for information, attend and record the proceedings of pre-bid meetings and bid opening meetings, evaluation of bids and

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preparation of bid evaluation reports, participating contract negotiations, preparing project contract documents for execution, and facilitating the execution of project contracts.

(ii) administer project contracts including processing of progress certificates, review of extension of time claims, preparation of change orders and nonconformance notices, subproject implementation progress monitoring, and subproject cost monitoring;

(iii) provide effective and regular supervision of the works; (iv) supervise quality control tests to ensure that the works are executed in accordance

with established standards, criteria, specifications, procedures, and approved design and environmental aspects in compliance with the environmental management and monitoring plan and the construction schedule.

62. The Construction Monitoring Consultant will have at least 15 years of experience in the construction of municipal infrastructure. Experience with international development agencies is required. The consultant must have experience in overseeing projects in remote and isolated communities and be sensitive to cultural and diversity issues

4. Community Engagement Specialist/Gender and Social Safeguards Specialist (International, 12 person-months, intermittent)

63. The Community Engagement Specialist/Gender and Social Safeguard Monitoring Specialist will: (i) design and lead a gender sensitive public awareness and community outreach campaign focusing on SWM issues, the importance of financially sustainable SWM services, and the ‘reduce, reuse, and recycle’ concept, and foster community understanding of the project, and (ii) conduct gender and social safeguard monitoring for Ebeye Solid Waste Management Project covering compliance and implementation of the poverty reduction and social strategy and gender action plan, and preparation of semiannual safeguard monitoring reports for submission to ADB. 64. Specific tasks and responsibilities of the Community Engagement Specialist/Gender and Social Safeguards Specialist will include: A. Awareness Raising Campaign

(i) Design a gender sensitive public awareness and community outreach campaign

focusing on SWM issues, the importance of financially sustainable SWM services,

and the ‘reduce, reuse, and recycle’ concept and foster community understanding

of the project. The public awareness and community outreach campaign will be

delivered by an RMI-based NGO over a period of 12 months commencing in 2023.

Monitor the implementation of the campaign and, where necessary, recommend

modifications to the campaign design and implementation arrangements to

enhance the campaign’s reach and effectiveness.

B. Gender and Social Safeguard Monitoring (i) Facilitate and monitor the implementation of the poverty reduction and social

strategy and gender action plan (GAP), including creating gender awareness in

Ebeye and within KALGOV and ensuring that the gender targets outlined in the

GAP are achieved.

(ii) Prepare semi-annual GAP monitoring reports for submission to ADB using the

ADB provided monitoring template.

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(iii) Ensure all contractors and consultants comply with the laws of RMI, ADB’s

Safeguard Policy Statement 2009, and ADB’s Anticorruption Policy.

With the Environmental Specialist,

(iv) Prepare semi-annual safeguard monitoring reports for submission to ADB.

65. The Community Engagement Specialist/Gender and Social Safeguards Specialist will have suitable tertiary qualification and demonstrated experience in: (i) community consultation and participation processes and management of community programs, and (ii) social safeguard monitoring following ADB’s Safeguard Policy Statement 2009.

5. Environmental Specialist (International, 6 person-months, intermittent) 66. The environment specialist will strengthen the environmental management, monitoring and reporting capacity of KALGOV and assist the PIU to prepare, review and implement the necessary environmental safeguards due diligence for the project. The expert will be responsible for establishing procedures for: (i) updating the initial environmental evaluation (IEE); (ii) monitoring and reporting the implementation of environmental management plans (EMPs) for project construction activities; and (iii) assisting KALGOV to monitor compliance with environmental statutory requirements relating to proposed improved solid waste management and landfill operations. The Environment specialist will work at KALGOV in Ebeye, RMI and report to the PIU Head and the City Manager of the Kwajalein Atoll. Specific tasks and responsibilities of the environment specialist will include:

(i) Upon commencement, review and confirm the environmental audit of existing

facilities and operations insofar as the project proposal for the upgrade of landfill operations;

(ii) Assist the PIU in reviewing all infrastructure designs, their proposed construction technology, and project implementation plan to identify any potential adverse environmental impacts;

(iii) Review and evaluate the IEE/EMP and environmental impacts of the contractors’ detailed design and intended construction methods and recommend options for design and construction, which enhances (i) biodiversity conservation, (ii) public health and safety, (iii) physical cultural resources, (iv) pollution prevention and abatement, and ensure those aspects are documented and incorporated into the IEEs/EMPs, CEMPs and other relevant reports as necessary;

(iv) Review the contractors’ CEMP and ensure that it complies with the IEE and EMP, RMI EPA permits and conditions and all contractual and environment safeguard requirements;

(v) Set up implementation of the detailed monitoring plan for CEMP implementation

and undertake regular compliance monitoring to ensure all works implemented are

in accordance with the approved IEE/EMP and CEMP. Monitoring will cover

preconstruction, construction, and operational phases;

(vi) Support PIU and KALGOV in recommending corrective actions where monitoring identifies non-compliance with the CEMP;

(vii) Support PIU in preparing monitoring reports based on the IEE and EMP monitoring. This will include review of the contractors’ monthly reports, and preparation of (i) inputs to the quarterly progress reports and (ii) semi-annual safeguards monitoring reports;

(viii) Provide capacity training on environmental safeguards and the requirements of the environmental assessment and processes to be followed by the project, to the PIU,

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design teams, contractors and relevant government agencies in relevant consultations;

(ix) In coordination with the IA, PIU staff or consultants, conduct necessary consultations facilitating informed public participation to raise awareness on the environmental objectives, actions, and outcomes of the project and assist in disclosing relevant safeguards information in accordance with the country’s laws and ADB’s Access to Information Policy 2018; and

With the Project Implementation Assistance Consultant/Solid Waste Management Specialist, (x) Ensure that appropriate studies are undertaken to assess the climate risk, and

assess how this risk will change with climate change, and ensure that the design of all infrastructure and all operations fully take into account the climate hazards and projected climate change.

67. The international environmental specialist will have academic qualifications in environmental science or closely related fields, and a minimum of 10 years’ experience in environmental impact assessment and mitigation identification in development of environmental assessment reports and detailed environmental management plans (EMP). Experience with an international financing institution like ADB or World Bank will be preferable with the consultant demonstrating evidence of having worked on implementing solid waste management projects in the region is essential.

6. Community Engagement Officer (National, 12 person-months, intermittent) 68. The Community Engagement Officer, in collaboration with the Community Engagement Specialist/Gender and Safeguards Specialist, will facilitate a gender-sensitive awareness raising campaign focusing on SWM issues, discussions and agreement with key project stakeholders to ensure that the project has strong stakeholder ownership and sustainably addresses the needs of the project beneficiaries. 69. The Community Engagement Officer will:

(i) Assist the project team to access data required for the implementation of the projects which may include: (a) liaising with local authorities to obtain data; (b) facilitating project stakeholder meetings and workshops; and (c) other tasks as directed by ADB related to data collection;

(ii) At the direction of the Project Implementation Assistance Consultant, Community Engagement Specialist/Gender and Safeguards Specialist, and the ADB project team, initiate, facilitate, and participate and assist ADB in consultations and communications with project stakeholders regarding: a) project financing and arrangements for counterpart financing. b) ADB guidelines and safeguard requirements. c) consultation, dissemination and awareness of the project activities and

outputs to the Community of Ebeye (ensuring that women, the poor, and vulnerable groups are actively engaged).

d) other issues as advised by ADB.

(iii) Other tasks relating to the preparation of the project as requested by ADB. 70. At least 10-years’ experience in community engagement is required.

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6. Community Outreach Program 71. An RMI-based NGO will be recruited to implement a gender-sensitive public awareness and community outreach campaign following the communication strategy and the p

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