Social Due Diligence Report

#Due Diligence Report for Maluku Subproject (Petra and Yacobus Check Dam) November 2019

Indonesia: Flood Management in Selected River

Basins Sector project

Prepared by Directorate of River and Coastal, Directorate General of Water Resources, Ministry of Public Works and Housing for the Republic of Indonesia and the Asian Development Bank.

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ABBREVIATIONS

ADB – Asian Development Bank AH – Affected Household AP – Affected Person BAPPEDA – Badan Perencanaan Pembangunan Daerah (Provincial/District Development Planning Agency) BPN – Badan Pertanahan Nasional (National Land Agency) BWS – Balai Wilayah Sungai (Center for River Basin) CBFRM – Community-Based Flood Risk Management COI – Corridor of Impact CWZ – Construction Works Zone DED – Detailed Engineering Design DGWR – Directorate General of Water Resources DMS – Detailed Measurement Survey EA – Executing Agency EIA – Environmental Impact Assessment EMA – External Monitoring Agency FMSRBSP – Flood Management in Selected River Basins Sector Project GOI – Government of Indonesia HH – House Hold IA – Implementing Agency IOL – Inventory of Losses IR – Involuntary Resettlement KM – Kilometer LA – Land Acquisition LAIT – Land Acquisition Implementation Team LRP – Livelihood Restoration Program MAPPI – Masyarakat Profesi Penilai Indonesia (Indonesian Professional Appraiser Association) MOHA – Ministry of Home Affairs NJOP – Nilai Jual Object Pajal (Tax Object Selling Price) PIB – Project Information Booklet PIU – Project Implementation Unit PPAT – Pejabat Pembuat Akla Tanah (Land Deed Official) SES – Socio Economic Survey SOE – State-Owned Enterprise SPS – Safeguards Policy Statement SPPT – Surat Pemberitahuan Pajak Terhutang (Government Notification Of Outstanding Tax)

This due diligence report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

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TABLE OF CONTENTS

EXECUTIVE SUMMARY ............................................................................................................................ 1

I. INTRODUCTION .................................................................................................................................. 3

A. Project Background and Location ......................................................................................... 3

B. Subproject Description ............................................................................................................. 3

C. Rationale for Due Diligence ..................................................................................................... 4

D. Approaches and Methods ........................................................................................................ 4

II. LAND ACQUISITION IN THE PETRA AND YACOBUS CHECK DAM ..................................... 5

A. Subproject Principles ................................................................................................................ 5

B. Subproject Petra and Yacobus Check Dam Of Impact Coverage ................................ 5

C. Meaningful Consultation and Disclosure ............................................................................ 6

D. Entitlements: Assistance and Compensation .................................................................... 7

E. Revenue Recovery for HHs who are Vulnerable and Affected by Adverse Impacts 9

F. Complaint Handling ................................................................................................................... 9

III. THE ACTUAL IMPLEMENTATION OF LAND ACQUISITION .................................................. 11

A. Land Acquisition Process ...................................................................................................... 11

B. Scope of Impacts, Valuation, and Compensation ........................................................... 13

C. Complaint handling mechanism .......................................................................................... 13

D. Project Disclosure .................................................................................................................... 13

IV. RESULTS, CONCLUSIONS, AND NEXT ACTIONS .................................................................. 15

A. Results and Discussion .......................................................................................................... 15

B. Corrective Action Plan ............................................................................................................ 16

V. APPENDICES ..................................................................................................................................... 18

Appendix 1. Documentation of Socialization of Land Acquisition Plan Appendix 2. Land Measurement Documentation Appendix 3. Assessment Report by the KJJP Independent Team Appendix 4. BA Land Acquisition Appendix 5: Map of Land Areas that have been released Appendix 6: Certificate of land acquired

LIST OF TABLES Table 1. summary of profile ahs/aps in location of yacobus and petra check dam ........................ 6 Table 2. Summary of Impacts for Petra and Yacobus Check Dam ............................................... 6 Table 3. The permitted rights are detailed .................................................................................... 7 Table 4. Details of Compensation for AHs .................................................................................. 14 Table 5. Compliance with Project Policies .................................................................................. 15 Table 6. Corrective Actions .......................................................................................................... 17

LIST OF FIGURES Figure 1. Location of Check Dam Petra and Check Dam Yacobus ................................................................... 3

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EXECUTIVE SUMMARY

1) Background and Project Location. The Flood Management In-Selected River Basin Sector Project (FMSRB) is being implemented as a result of the agreement between the Government of Indonesia and the Asian Development Bank (ADB). The Executing Agency (EA) of the project is the Maluku River Region Hall (BWSM) of the Ministry of Public Works and Housing.

2) The proposed project will support the government and the community to better manage and reduce the risk of flooding. The project aims to shift the paradigm of project-oriented flood control centered around structural measures, for process-oriented integrated flood risk management (IFRM) that provides a balanced mix of non-structural, institutional and capacity building, and structural work interventions to reduce the negative impact of flooding. Project interventions will (i) improve data, information, knowledge base and institutional coordination for flood management, (ii) improve or develop water management infrastructure, (iii) reduce erosion and improve watershed conditions, and (iv) prepare communities to manage flooding. The main beneficiaries are floodplain communities in certain watersheds located in the Batu Merah river basin area which includes villages: Batu Merah, Rijali, Amantelu, and Wayhoka Village.

3) One of the sub-projects of FMSRB is the Construction of Petra and Yacobus check dams located in the upper reaches of the Batu Merah River, in the area of Wayhoka and Batu Merah Village, Sirimau District, Ambon City, Maluku Province. Maluku River Region Hall (BWSM) of the Ministry of Public Works and Housing will be the Implementing Agency (IA) for the subproject. the sub-project is expected to reduce the impact of floods that often occur around the Batu Merah river settlement in Ambon City.

4) Reasons for Due Diligence. This Due Diligence was conducted because the lands to be used for sub-projects of Petra and Yacobus Check Dams in Ambon city, have been acquired. This due diligence is carried out to ensure that the land acquisition for this sub-project has been conducted in accordance with regulations of Indonesian government, ADB SPS, and safeguard principle set forth in the Resettlement Framework (RF) approved by ADB in 2015. Where non-compliance is identified, a corrective action plan to address the issues is prepared in agreement with ADB.

5) Methods. The method used for the due diligence are the following: (i) field visits to observe location and condition of project area; (ii) consultations and interviews to APs and other key stakeholders, and (iii) review of documents relating to the land acquisition process from BWS Maluku and BPN.

6) Land Acquisition Process and Compliance with the ADB’s Safeguards Policy Statement for the Project. Land acquisition has been undertaken in following the government procedure for negotiated land acquisition. The Land Acquisition Implementation Team led by BWS Maluku and the National Land Agency (BPN) of Ambon City completed the land acquisition activities in December 2015 and 2017, which included: (i) detailed measurements of the affected assets, (ii) appointment of an Assessment Team for rights assessment, (iii) negotiation on the type and amount of compensation, (iv) compensation payments and release of land rights, potential relocation, (v) handling of complaints related to IOL and joint compensation with Maluku BWS, and (vi) submission of land documents obtained by BWS Maluku. Some issues are identified and a corrective action plan (CAP) has been prepared to meet the project RF and ADB SPS.

7) Consultation and Disclosure. Meaningful consultations were conducted for the land acquisition process since at the stages of planning, preparation and implementation. Women participated in the consultations. The consultations were conducted by the BWS Maluku and Ambon City Government in September 2015. Information Notification is done through APs meetings and posting announcements in Churches and Village Offices Boards.

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8) Compensation Valuation and Payment. Compensation valuation for the lost land and non-land assets was carried out by Independent Appraisers. The valuation includes lost land, plants, waiting costs and administrative tax costs. Compensation payment for all APs were provided in December 2015 following valuation by the independent appraisers. The acquired land is the plantation area, so there is no lost structure and physical relocation of people. Impacts during construction including the lost non-land assets will follow requirements and entitlements in the project RF.

9) Submission of results and the land. Certification process has been carried out by the BPN of Ambon City. The land certificates have been updated on behalf BWS Maluku.

10) Livelihood Recovery. None APs considered as vulnerable people, and therefore, the livelihood recovery programs are not provided to them.

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I. INTRODUCTION

A. Project Background and Location 1. The proposed project will support the government and the community to better manage and reduce the risk of flooding. The project aims to shift the paradigm of project-oriented flood control centered around structural measures, for process-oriented integrated flood risk management (IFRM) that provides a balanced mix of non-structural, institutional and capacity building, and structural work interventions to reduce the negative impact of flooding. Project interventions will (i) improve data, information, knowledge base and institutional coordination for flood management, (ii) improve or develop water management infrastructure, (iii) reduce erosion and improve watershed conditions, and (iv) prepare communities to manage flood recipients the main benefits are floodplain communities in certain watersheds located in the Batu Merah river basin that includes villages: Batu Merah, Rijali, Amantelu, and Wayhoka Village. 2. In Flood Management Selected River Basin Sector Project (FMSRB) activities in Ambon Maluku include 5 rivers namely; Way Batu Merah river, Way Ruhu, Way Batu Gantung, Way Tomo and Way Batu Gajah river. However, the 2 rivers that are prioritized are sure of the Way Batu Merah River and Way Ruhu. 3. Location of Development Subprojects Check Dams Petra and Yacobus in the upper reaches of the Batu Merah River Ambon City Maluku Province The project location is located in Wayhoka and Batu Merah Villages, Sirimau District, Ambon City, Maluku Province.

B. Subproject Description 4. Maluku BWS required 2,231 M2 of land for the construction of Check Dam Petra which consists of 3 parcels of land, while for Yacobus Check Dam requires 960 M2 land which consists of 2 plots of land, the land acquisition were funded by APBN. 5. Control of flood flash flood, one of which is by making a check dam which also functions as a sediment controller during a flood to keep the river balanced naturally and safely against the community around the river, even though the check dam function is not to eliminate flooding but reduce risk of damage to the strategic locations of residential centers and economic activities.

FIGURE 1. LOCATION OF CHECK DAM PETRA AND CHECK DAM YACOBUS

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6. Construction of the Check Dam on the upper reaches of the Batu Merah River as financed by ADB is only a small portion of the acquired land, concerned for the entire handling of the Batu Merah river by BWS Maluku in collaboration with the Ambon City Government, so that flood management can be facilitated properly and comprehensively. 7. This project covers the area of Batu Merah Village covering RT.02.01.03 / RW.016, and Wayhoka Village includes RT.03 / 004. The topography of the area is hilly and steep, this area is an unproductive community plantation, with only a few plants such as bananas, cassava, sago, bamboo and weeds.

C. Rationale for Due Diligence 8. Resettlement Framework and procurement of land were prepared for the entire project and agreed by the EA and ADB in 2015. The initial draft Land Acquisition and Resettlement Plan (LARP) for the Check Dam Construction was prepared in 2015. While the LARP is still the draft, the Land Implementation Team led by BWS Maluku and the Land Office (KATR/BPN) of Ambon City continued the land acquisition and completed the activities in December 2017. As the land has been acquired, the Due Diligence Report (DDR) is prepared to report the land acquisition process and its impact to the APs and to determine that the activities were in accordance with the government procedure on land acquisition, project RF, and ADB SPS. Outstanding issues identified have been will be addressed and included in the CAP.

D. Approaches and Methods 9. Approach of this due diligence is attached to the consultation and participation of affected people (APs), Maluku BWS as the Implementing Agency (IA), and other entities mandated to oversee aspects of involuntary resettlement. A series of cross-checking / triangulation of information was carried out in the implementation of this DDR and as such, the following methodology was used:

(i) Site visit – In year 2015 the BWS protection officer together with the PPTA security team visited sites related to this.

(ii) Key consultations and interviews were conducted, see Appendix 1 for a list of interviewees, consultation participants, and several photos;

(iii) Review of documents relating to the land acquisition process from BWS and BPN of Ambon City. In the context of involuntary resettlement, the displaced persons those who are physically displaced (relocation, loss of shelter or loss of shelter) and/or economically displaced (loss of land, assets, access to assets, income sources, or means livelihoods as a result of; (i) involuntary land acquisition, or (ii) forced restrictions on land use or access to legally designated parks and protected areas.

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II. LAND ACQUISITION IN THE PETRA AND YACOBUS CHECK DAM

A. Subproject Principles

10. The purpose of ADB's safeguard policy is to avoid involuntary resettlement if possible; to minimize involuntary resettlement by exploring project alternatives and designs; and to improve, or at least restore, the livelihoods of all displaced and vulnerable people in real terms, relative to pre-project levels, and to improve the living standards of displaced poor people and other vulnerable groups. 11. The project Resettlement Framework includes principles of negotiated land acquisition. As the land acquired is less than 5 hectares, the BWS acquired the land through negotiated land acquisition. The principles applied for the negotiated land acquisition as per the RF are the following;

(i) Compensation is paid at replacement value which takes into account the prevalent market prices as determined by independent appraisal or through consultation with entitled parties including those without legal title to assets to enable all affected land owners to replace their affected assets. No administrative cost will be deducted and tax obligations will be covered by the negotiated transaction.

(ii) All negotiations with the landowners and users if any will be carried out in an accessible location, in an open and consultative manner without any coercion and with sufficient time for consideration of offers.

(iii) The documents pertaining to the land acquisition such as map, land registries, sales written records, consultation records, decision records, law and policies for the negotiations and development plans are to be disclosed to the entitled parties involved in the negotiated land acquisition or settlement.

(iv) Adequate and fair price for land and/or other assets will be offered. Owners are free to refuse to sell their land or to refuse the offers of DWRG’s or implementing agency. If negotiations fail, an alternative way will be sought and the process begins again

(v) An independent external party who is not involved in the project will record and validate negotiation process and ensure that the process is transparent and the bargaining positions of the parties involved in the negotiations are equal.

(vi) When negotiations are completed, inventories of affected land and other fixed assets are prepared in consultation with affected landowners and a copy of the same is to be given to each land owner.

(vii) The negotiated amount will be paid immediately to landowners after all necessary documents required for the land acquisition processes have been completed by land owners.

(viii) All market analysis, negotiation and other consultation proceedings will be documented and the land sale and purchase agreement will be signed by the negotiating parties in the presence of a Land deed official (PPAT) and the village head or community leaders.

(ix) Land acquisition identification, planning and monitoring will ensure that gender concerns are incorporated.

(x) Grievance mechanism will be established to receive and facilitate resolution of the entitled parties concerns.

(xi) DGWR will not award a civil works contract until payment has been fully provided to the entitled parties and rehabilitation measures if any.

B. Subproject Petra and Yacobus Check Dam Of Impact Coverage 12. The loss inventory was carried out in March 2014 by the project preparation technical assistant (PPTA) together with the BWS Maluku staff assisted by the Ambon City Research and Development Agency in collaboration with local leaders Batu Merah and Wayhoka Villages in

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consultation with Ambon City BPN. From the results of the land inventory the loss assets are the agricultural land and crop/tree losses. Table 1 below provides the profile of affected households:

TABLE 1. SUMMARY OF PROFILE AHS/APS IN LOCATION OF YACOBUS AND PETRA CHECK DAM

No Name AHs Sex Age

(years old)

Work Income/month

(Rp)

No. of Family

Members Vulnerablity

1 Karim Hunsow Male 57 Entrepreneur (Trader)

7,500,000 4 person Not

vulnerable

2 Istawan Mahakena Male 54 Entrepreneur (Cafe Owner)

10,000,000 5 person Not

vulnerable

3 Said Waliulu Male 47 Private employee

4,000,000 4 person Not

vulnerable

Source: Field data collection by Yusuf (Maluku BWS field Implementing Staff)

13. From the results of the land inventory there is only a loss of agricultural land assets, the loss of crops/trees, as summarized in table 2 summary of Impacts for Petra and Yacobus Check Dam.

TABLE 2. SUMMARY OF IMPACTS FOR PETRA AND YACOBUS CHECK DAM

Item Unit Quantity

Affected persons Person 13

Affected households HH 3

Land Affected by Damascus area (Farmlands) - plantation land owned by the community

M2

3.191,00

Productive tree Tree 171

Agricultural Crops M2 820,00

Plantation land around the Check Dam area Ha 4,00

Structure / building around Check dam area Unit 143

Land settlements around the check dam area Ha 4,50

Households around the check dam area HH 92

Vulnerable Ahs/APs Person -

Poor Ahs HH -

Female head of the elderly household HH -

Households headed by poor parents HH -

Severe AHs for Check dam HH -

C. Meaningful Consultation and Disclosure 14. Meaningful consultations should be carried out with the entitled parties/APs, host communities and concerned groups if any relocation, land or other assets acquisition and ensure participation from planning up to implementation. Meaningful consultation is a process that (i) begins early in the project preparation stage and is carried out on an ongoing basis throughout the project cycle; (ii) provides timely disclosure of relevant and adequate information that is understandable and readily accessible to affected people; (iii) is undertaken in an atmosphere free of intimidation or coercion; (iv) is gender inclusive and responsive, and tailored to the needs of disadvantaged and vulnerable groups; and (v) enables the incorporation of all relevant views of affected people and other stakeholders into decision making, such as project design, mitigation measures, the sharing of development benefits and opportunities, and implementation issues. Particular attention will be provided to the needs of vulnerable group and ensure their participation. 15. Public consultation meetings should include:

(i) An orientation on the project: Subproject designs, schedules of implementation, (ii) and identification / introduction of PIU focal / contact persons; (iii) Project benefits, potential adverse impacts, and mitigating measures to be taken;

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(iv) Valuation methods and entitlements/compensation packages; (v) Grievance process and monitoring; and (vi) Subsequent schedule of meetings.

16. Disclosure. Overall project disclosure of the following documents is required:

(i) Draft LARP endorsed by the DGWR before subproject appraisal; (ii) The final LARP endorsed by DGWR after the census of entitled parties has been

completed; (iii) New or updated LARP, and a corrective action plan prepared during subproject

implementation, if any; and (iv) The LARP monitoring reports and LARP final completion report.

D. Entitlements: Assistance and Compensation 17. Feasibility. The entitled parties are those whose, as a consequence of the project, all or part of their physical and non-physical assets are affected including houses and income generation opportunities. Such impacts can be permanent or temporary. The parties who have the right to fulfill the conditions for obtaining compensation in cash or goods and other assistance under this project. 18. The eligibility deadline for project rights refers to the date when the Resettlement Implementation Team led by BWS together with the Ambon City BPN, posted the results of DMS in public places (for example, village offices, public sports areas). The cut-off date set a time limit to determine the eligibility of people living and / or with assets or interests within the project area. If they are negatively affected, they should be entitled to compensation for their affected assets, including the necessary rehabilitation measures, enough to help them improve or at least maintain their pre-project standard of living, income generation capacity and level of production. Those who penetrate into the project area, or one of its sub-projects, after the cut-off date will not be entitled to compensation or other assistance. 19. Ownership rights. Project ownership covers the scope of the impact and involuntary resettlement policy Table 3. The Entitlement Matrix is regulated in this Due Diligent Report.

TABLE 3. THE ENTITLEMENT MATRIX

No Category of Impact / Loss

Eligible People Project rights Information

A. Land Loss

1 Land loss, including agricultural land and settlements

Those who have formal legal rights (certificates) or those who claim land are recognized as complete titles including those who occupy state land in good faith.

• Cash compensation at replacement costs and reflect fair market value at the time of compensation payments; or land replacement with at least attributes similar to land acquired in terms of value, productivity, location and certification. Every tax and transactional fees are borne by the project.

• Financial assistance for renewal of land ownership documents (certificates and land documents recognized as full titles) for the remaining land of the rightful person.

• Compensation assessment carried out by an independent licensed property appraiser. This was used for compensation payments by the Land Procurement Implementation Team.

• months advance notice is given to the entitled party

before they have to destroy the overall house and store

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• If the remaining affected land cannot function for special use and use, the rightful party can request compensation for all their land at replacement cost (Law No.2 of2012 article 35).

B. Loss of trees / plants:

1 Loss of Plants and Trees:

The owner, regardless of land ownership status (with recognizable certificates or rights, informal residents, occupants).

• Annual crops: cash compensation will be paid based on prevailing market prices.

• Annual crops: compensation at replacement costs taking into account their productivity and age.

• Timbers/trees: compensation at the current market level based on age, tree type and stem diameter of trunk at breast height.

• Law No. 2 /2012 Pasal 33

• Presidential Regulation No. 71/2012 Article 65

• Indonesia Valuation Standards 306 (SPI 306) / 2013

• Commercial plants: refers to the income approach using Discarded Cash Flow (DCF) for 1 cycle.

• Non-commercial crops: refers to the market approach with reference to standard prices issued by the local government

• Non-productive crops: refers to the approach to the cost of non-productive plants: refers to the cost approach;

• Assessment of non-productive crops will use a cost approach;

• 30 to 60 days prior notice before harvest / land clearing.

D. Temporary or Permanent Impact on Non-Land Assets During Construction

1 Temporary or permanent impacts due to construction activities

For those who have formal legal rights (certificates) or those who claim land are recognized as full rights

• For payment of lease of land affected by the contractor based on the applicable rental costs and agreement with the land owner.

• For temporary impacts on productive land, AH can choose

• (1) rental costs which are considered not less than net income that will be generated from land affected by productive impacts;

• Compensation for non-land assets acquired (trees / plants, structures) that are permanently affected will be compensated with replacement costs

• Land will be returned to pre-project conditions or even better after construction is completed

Those who do not have legal rights and rights that can be recognized as full ownership

There is no land rental fee during the period of impact The land will be recovered as before the project, or even better.

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E. Other Appraisal Losses

1 Transaction fees Those who have the right to lose land and non-land assets

• Allowances to cover administrative costs, renewal of ownership of land for residual land, land clearing

• Refers to Presidential Regulation No. 71/2012 Article 112 and Indonesia Standard of Valuation (SPI) 306, 2013

Calculations are based on Loss Inventory (IOL) and Socio-Economic Survey (SES)

- ADB. Involuntary Resettlement Safeguards: A Planning and Implementation Good Practice Sourcebook – Draft Working Document. November 2012.

- Article 29 of Law No. 2 of 2012

20. Assessment and Replacement Cost. In line with the the RF of the FMSRB, BWS contracted an independent appraiser to assess compensation for land losses. Assessment of land acquisition applies the Indonesian Assessment Standard 306, 2015. The basis of the assessment is:

(i) Fair Replacement Value - This value can be understood as a value based on the owner's interests (value for the owner);

(ii) Equilibrium of market value; (iii) non-physical losses resulting from the release of the right that should be the property

owner; (iv) property ownership is not limited to ownership rights, but can be interpreted as control,

management and use of property in accordance with applicable laws and regulations or in accordance with the agreed scope of tasks; (v) The valuation date is the date of announcement, and the date of location determination for development in the public interest in accordance with the applicable laws and regulations;

(v) value addition is calculated based on the risk arising from the potential loss of the owner.

E. Revenue Recovery for HHs who are Vulnerable and Affected by Adverse Impacts 21. AHs/APs are not considered as vulnerable since there is no lost of their livelihood from land. Based on survey, there is no women-headed household affected or APs considered as poor or vulnerable. Therefore the livelihood restoration program are no longer needed to be budgeted or implemented by the Regional Government through the Social Action Plan (SAP) program.

F. Complaint Handling 22. Complaints related to any aspect of the Project will be handled through negotiation with the aim of reaching consensus. The procedures that must be followed in resolving complaints about affected assets, the level of compensation offered by the government, and other aspects of the project are outlined below. All administrative channels, such as the Camat Office and the Village Office, will be exhausted in an attempt to resolve each complaint before being appointed to court for adjudication. There are no fees charged to APs in connection with complaints handling mechanisms. Field visit for completion of this report has found no complaint rise up from APs, both in relation to inventory of assets and compensation payment process.

1) Associated with the Affected Asset Inventory 23. The announcement of the results of the inventory and identification must include items of ownership, size, location, and map of the project area. The reason for the complaint is: (i) the right party does not receive the results of the inventory, and (ii) the party has the right to object to the results of the inventory. Thus, the complaints procedure that will be carried out are:

(i) The rightful party who feels aggrieved can raise objections to the results of an inventory of land and other assets found on the affected land (buildings, plants, other objects) in the Land Procurement Implementation Team (TPPT).

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(ii) TPPT within 14 days will examine the results of the inventory of affected assets belonging to the complaining citizen and will make revisions / improvements, as needed. If the citizen is not satisfied with the findings of the TPPT, residents can bring this matter to the local court for settlement.

(iii) If a complaint / complaint regarding land ownership / control and / or other assets is found on the affected land, TPPT will seek a settlement with the complainant through consultation.

(iv) If the consultation does not bring a settlement, the TPPT encourages those who have the right to resolve it through the court.

2) Related to Compensation 24. Based on Law Number 2 of 2012, the rightful party who feels aggrieved can bring a complaint / complaint in terms of the level of compensation directly to the TPPT or land agency through community leaders, who will submit it to the TPPT both in writing and verbally. TPPT together with BPN and community leaders will try to find consensus to reach a settlement that can be accepted by the right party who is disadvantaged. Especially:

(i) The eligible party who is not satisfied with the amount of compensation offered by TPPT has 30 days to seek an agreement with the TPPT on the level of compensation for the affected assets, including the loss of trade income or work affected.

(ii) If negotiations regarding damages with the TPPT (Land Acquisition Team) fail, the entitled party within 14 days may file a complaint with the district court regarding the compensation offered by the TPPT. The court will process this case within 30 days.

(iii) If the rightful party is not satisfied with the decision of the district court, within 14 days after the decision by the district court, the person concerned can bring the case to the Supreme Court and look for a reversal of the district court decision. The Supreme Court will decide this case within 30 days.

3) Related to Other Aspects of the Project 25. Objections related to construction activities and other issues such as resettlement that are not included in the objection settlement mechanism in Law Number 2 of 2012 and Republic of Indonesia Presidential Regulation Number 71 of 2012, such as access restrictions, settlement mechanisms can be taken as follows:

(i) The rightful party can submit objections to project staff, contractors, or village heads or local community leaders who will bring the objection to project staff in the field or subproject office. Project staff who handle land acquisition and social protection will record objections to sub-project management.

(ii) The project manager will consider the complaint and within 15 working days to deliver the decision to the person who submitted the complaint. Project staff will facilitate communication between residents who raise objections to project management in resolving complaints. The project staff will document the objections and the settlement.

(iii) If a citizen who expresses an objection is not satisfied with the decision or handling of an objection, the person concerned can bring the case, either in writing or verbally to the regent / mayor within 14 days of the issuance of the decision.

(iv) The Mayor will decide the complaint within 30 days by asking for opinions / wishes from: (i) the rightful party who reports the complaint / objection, (ii) other related parties related to the complaint.

(v) If there is no decision for the complaint or if the affected person is not satisfied with the decision taken by the regent / mayor, the person concerned can bring the complaint / case to court for final settlement.

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III. THE ACTUAL IMPLEMENTATION OF LAND ACQUISITION

A. Land Acquisition Process

26. Socialization of the Land Acquisition Plan. The socialization and consultation of land acquisition plan to APs was carried out on September 11, 2015 in the Batu Merah and Exit Wayhoka lands. The socialization activity carried to ensure APs understand the land acquisition plan and process for the Check Dam development. The results from socialization activities are as follows:

(i) Basically the land owners have no objection to the land land acquisition for check dam construction, as long as the BWS Maluku can provide compenstion in accordance with market prices and does not harm the land owners.

(ii) Land measurement and data collection would be carried out on 12 September 2015 involving by landowners, Sirimau District staff, Batu Merah District staff and Wayhoka Village and staff, and Maluku BWS.

(iii) After the data collection and measurement, an inventory of loss activity was conducted by the Independent Appraisal Team. At the time of inventory and appraisal, assets identified in data collection were re-measured and valued based on the appraisal standard.

27. Implementation of Data Collection and Measurement of Land. Preliminary data collection on affected assets and affected peoples was conducted on 12-16 September 2015 at the existing Check Dam area in Kampung Rinjani Negeri Batu Merah, and in other 2 locations for development of new Check Dams at: 1) Near Petra Church between Wayhoka Village and Negeri Batu Merah, and 2) Near Yacobus Church between Wayhoka Village and Batu Merah Country. The data collection conducted involving the landowners and officials of the Batu Merah District, Wayhoka Village, Sirimau District, and the BWS Maluku staff. The results of data collection and measurement at the new Check Dam location are were follows:

(i) For the Petra Check Dam, there is 1 land owner in Wayhoka Village and 1 land owner in Batu Merah. The land area to be acquired is 2,231.00 m2. The condition of land use is empty land, planted with fruits trees (bananas, jackfruit. rambutan, and cashew nuts), and wood plants (linggua, bamboo).

(ii) The location for Yacobus Check Dam, there is 1 land owner in Waihoka Village and 1 land owner in Batu Merah. The land area to be acquired is 960.00 m2. The status of land use is vacant land.

(iii) Based on identification by BWS field staff, there is no AH severely impact by land acquisition, and all AHs are not considered as vulnerable due to their income above the poverty line and their sources of income are not coming from the acquired lands. There is also no female-headed households affected by land acquisition.

28. Inventory of loss (IOL) by an Independent Appraisal Team. The asset valuation for inventory of loss was carried out by an Independent Appraisal Team, namely Public Appraisal Services Consultant (KJPP) Abdullah Fitriantoro and Partners who are based in Jakarta. Asset assessment was conducted from 8 - 10 October 2015, covering assessment on the land and growing plants. This asset assessment was intended to determine the amount of budget that must be allocated by BWS Maluku for the compensation payment to the entitled persons. 29. According to the results of initial assessment, the amount of compensation that must be incurred by the BWS Maluku is greater than the budget ceiling set in the 2015 budget year. Therefore compensation payments were only focused on 1 plot of land in the the existing Check Dam; and for 5 plots of land in the new check Dam location near the Petra Church and the Yacobus Church in Wayhoka and Batu Merah Village. 30. The final assets assessment of the final assets was carried out after the measurement by the National Land Agency of Ambon City. An assessment of the final assets was carried out as a

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reference basis for payment of compensation by the BWS Maluku to the land owner. The results of the assessment were also used as a basis for deliberation of the amount of compensation between landowners and BWS Maluku. The final assessment found some changes from the initial assessment results as follows:

(i) There is a change in the size of the land which must be released by the National Land Agency of Ambon City, especially in the new Check Dam location;

(ii) Appraisal adjustments are made for the status of land (with proof of Ownership Certificate) located in the new Check Dam area near Petra Church in Wayhoka Village,

(iii) Adjustments for swampy soil conditions that have the potential to become puddles when floods and dry land are located near existing Check Dam of Wayhoka Village.

31. On 15 November 2015, the results of final assets valuation was announced and submitted to four (4) landowners whose land will be used as the checkpoint. the report on final asset appraisal has been completed by KJPP Abdullah Fitriantoro and Partners in 2015 and 2017. 32. The consultation on the compensation value was held on 11 October 2015 at the residence of each land owner. As a basis for reference in the form of compensation, the results of the initial phase of the asset assessment were made by KJPP Independent Appraisal Team Abdullah Fitriantoro and Partners. The results of the consultation were included in the minutes signed by all landowners and witnessed by the Batu Merah State Apparatus and Wayhoka Village. The results of the deliberation were as follows:

(i) The land owners agreed to release the land for the construction of Check Dam, provided that they receive fair compensation agreed in the deliberation for the compensation.

(ii) The compensation payment is provided in cash. (iii) The fair replacement value or compensation is carried out by an Independent Appraiser

and the result is announced by the Maluku River Region Hall Office (BWSM). (iv) The deliberation of determining the fair compensation should be conducted after the

Independent Appraiser submits the final assessment (final) results to the Maluku River Region Hall Office (BWSM).

33. Deliberation on the amount of compensation was carried out on 17-18 November 2015 between the Maluku River Region Hall Office (BWSM) and the landowners. The key points discussed and agreed on the amount of compensation were as follows:

(i) The land owner is willing to release ownership of the land for the construction of the dam in accordance with the fair replacement value that has been made by Public Appraisal Services Consultant (KJPP) Abdullah Fitriantoro and Partners and adjustments have been made based on the results of the deliberation between the land owner and the Maluku River Region Hall Office (BWSM) .

(ii) The amount of the fair replacement value is determined by the following conditions: a) Adjust the value of the land price with the prevailing market price calculated by the Independent Appraisal Consultant to each land owner. b) For land with the status of land owned with proof of certificate ownership, an adjustment is given which will be calculated by an Independent Appraiser Consultant. Full details of the amount of the Compensation Form can be seen in the Attachment which is an integral part of this Minutes.

(iii) Each Land Owner and Balai Maluku River Region (BWSM) made an agreement to transfer the Land Rights known to the Batu Merah Government, Wayhoka Village, Sirimau District Government and National Land Agency of Ambon City,

(iv) The Ambon City Land Office will re-check proof of land ownership and physical condition of the land in the field.

(v) Maluku River Region Hall (BWSM) will make compensation payments to each landowner with the following conditions: i). Each land owner has submitted a Land Ownership Certificate and Certificate Not in a Dispute known to the Government of Batu Merah , Wayhoka and Sirimau Sub-districts. ii) Re-checking of evidence of land ownership and field review has been carried out by the Ambon City Land Office, iii) Payment will be carried out through a transfer process to each landowner's account.

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(vi) Provisions on the payment of taxes on payment of damages will be carried out by the Maluku River Region Hall Office (BWSM).

34. Measuring activities by the National Land Agency of Ambon City carried out on 12-13 October 2015 witnessed by landowners, BWS Maluku, Batu Merah Country, Wayhoka Outflow and Sirimau District. 35. Releasing and Submitting the Right to Rights. In accordance with the results of the deliberations between the Maluku BWS and the landowners, an agreement was made to transfer the rights to land known by the Batu Merah Government, Wayhoka Village, Sirimau Subdistrict, and National Land Agency of Ambon City. Releasing activities and submission of rights bases are carried out from the 20th of s.d. November 30 2015. 36. The submission of results and the land certification process has been carried out by the National Land Agency of Ambon City from the 11th day of the month. The submission of the results of the measurement data and the names of the landowners have been submitted by the National Land Agency of Ambon City to Maluku BWS on December 10, 2015. While the submission of land certification was carried out on December 24, 2015 and 2 more plots were handed over in December 2017.

B. Scope of Impacts, Valuation, and Compensation

37. The compensation payment activity by the Maluku BWS was carried out from the 5th to 10th of December 10, 2015. The compensation payment process was carried out in accordance with the results of the deliberations carried out with the following conditions:

(i) Each landowner has submitted a Land Ownership Certificate and Not in Dispute Certificate known by the Batu Merah Government, Wayhoka Village and Sirimau District.

(ii) Re-checking of proof of land ownership and field review has been carried out by the Ambon City Land Office.

(iii) Payment was carried out through a transfer process to each account of the landowner. (iv) Report of the KJJP Independent assessment team Appoints a work agreement

between the Ministry of Public Works Directorate of Water Resources in this case the Maluku BWS with the Office of Public Appraisal Services (KJPP) Abdullah Fitriantoro & Partners, No. 03-SPK / PPK-SPI / X / 2015, dated October 5, 2015 and Work Agreement Number 17 / SPK / PPK-SP.l / Xl2017 dated October 31, 2017, to provide opinions regarding the assessment of compensation for land, crops and losses others as in the following table;

C. Complaint handling mechanism 38. Complaints related to any aspect of the Project were handled through negotiations with the aim of reaching consensus. All administrative channels, such as the Camat Office and the Village Office, will be exhausted in an attempt to resolve each complaint before being appointed to court for adjudication. There are no fees charged to APs in connection with complaints handling mechanisms. There is no complaint from APs recorded in BWS since the APs has accepted the compensation values submitted from independent appraisal and the process of payment completed.

D. Project Disclosure 39. Socialization of the Land Acquisition Plan. The socialization of land acquisition plans to APs was carried out on September 11, 2015 in the Batu Merah and Exit Wayhoka lands. The socialization activity was carried out so that the activity plan could be well consulted to the community, so that the community could find out and understand the land acquisition process for the Check Dam development plan. Dissemination of information about this project through the distribution of PIB and socialization to community groups and other relevant stakeholders. PIB in Indonesian is distributed to APs on September 15, 2015.

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TABLE 4. DETAILS OF COMPENSATION FOR AHS

Name of AHs

Location

large M2

Reimbursement value is reasonable

Remarks Physical Non Physical The amount

received is entitled after

deducting PPh 21 5% (Rp)

Land (Rp) Building (Rp)

Plant (Rp) Solatium

(Rp) Transaction

Fee (Rp)

Waiting period interest

(Rp)

Reasonable Total (Rp)

Income Tax 21 of 5% (Rp)

Karim Hunsow

Petra Batu Merah

702 58.687.200 - 23.784.130 - 819.498 2.811.065 86.101.893 4.305.095 81.796.798 Asesment 2017

Yacobus Batu Maerah 583 23.240.554

-

6.183.192 6.972.166 2.353.900 993.051 65.029.641 3.251.482 61.778.159 Asesment 2017

Istawan Mahakena

Petra Wayhoka (Tanah Depan)

1.000 172.289.453 - - 51.686.836 13.783.156 5.814.769 243.574.214 12.178.711 231.395.503 Asesment 2015

Petra Wayhoka (Tanah Belakang)

529 52.090.914 - 9.762.422 15.627.274 4.948.267 2.087.550 84.516.427 4.225.821 80.290.606 Asesment 2015

Said Waliulu Yacobus Batu Maerah

377 23.240.554 - 6.183.192 6.972.166 2.353.900 993.051 39.742.863 1.987.143 37.755.720 Asesment 2015

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IV. RESULTS, CONCLUSIONS, AND NEXT ACTIONS

A. Results and Discussion 40. Land procurement for the Check Dams Petra and Yacobus Development Subprojects in the upper reaches of the Batu Merah River has been obtained using procedures stipulated in Law No. 2/2012 concerning Land Acquisition for Public Interest Development and its implementing regulations i.e. (i) President of the Republic of Indonesia Regulation No. 71/2012 and President of the Republic of Indonesia Regulation No. 40/2014 on the Amendment to the President of the Republic of Indonesia Regulation No. 71 of 2012; ; (ii) Head of National Land Agency No. 5/2012; (iii) Ministry of Finance Regulation No. 13/PKM.02/2013; and (iv) Ministry of Home Affairs Regulation No. 72/2012). The law and regulations were issued to ensure land acquisition for the implementation of development for the public interest, with the emphasis on the principles of humanity, democratic, and equitable. These legal provisions replaced previous land acquisition laws and its implementation regulations (President of the Republic of Indonesia Regulation No. 65 of 2006; President of the Republic of Indonesia Regulation No. 36/ 2005; BPN Head Regulation No. 3/2007). 41. Consultation and Disclosure. All consultations are organized and facilitated by Head of village/Raja Negeri leaders. Consultation was conducted to all APs, regardless of gender. Information on project plan also shared through consultations/meetings and announcements posted in churches and Village Offices.

TABLE 5. COMPLIANCE WITH PROJECT POLICIES

Project Policy Safeguard Compliance

(i) Compensation is paid at replacement value which takes into account the prevalent market prices as determined by independent appraisal or through consultation with entitled parties including those without legal title to assets to enable all affected land owners to replace their affected assets. No administrative cost will be deducted and tax obligations will be covered by the negotiated

Comply. Compensation payment for the lost land was based on valuation by independent appariser. Independent appraiser has been contracted for assets valuation even though the regulation allows BWS to negotiate to land owner since total land acquired is under 5 hectares. The appraiser used the SPI (Indonesia Valuation Standard) method for the compensation evaluation. The payment proofs have been documented by BWS Maluku and attached in this report.

(ii) All negotiations with the landowners and users if any will be carried out in an accessible location, in an open and consultative manner without any coercion and with sufficient time for consideration of offers ensure their participation in the project cycle.

Comply. All assessment and consultations coursed through the community leaders and conducted in the local language. The official records on the consultations are attached in this report. No complaint received by BWS on the compensation payment. However, grievance redress mechanism will be set up/strengthened for this project at BWS Maluku. and grievance

(iii). The documents pertaining to the land acquisition such as map, land registries, sales written records, consultation records, decision records, law and policies for the negotiations and development plans are to be disclosed to the entitled parties involved in the negotiated land acquisition or settlement.

Comply. All documents relating to land acquisition have been disclosed and approved by the parties who are entitled and involved in land acquisition as in the appendix

(iv). Adequate and fair price for land and/or other assets will be offered. Owners are free to refuse to sell their land or to refuse the offers of DWRG’s or implementing agency. If negotiations fail, an alternative way will be sought and the process begins again

Comply. Results from independent appraiser has been disclosed and offered to land owners. All APs were paid according to the valuation acceptable to them.

(v). An independent external party who is not involved in the project will record and validate negotiation process and ensure that the process is transparent and the bargaining

Not Comply. There is an independent and external party mobilized yet to record and validate this due diligence report. The action to address this

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positions of the parties involved in the negotiations are equal.

compliance has been included in the Table 6 of corrective action.

(vi). When negotiations are completed, inventories of affected land and other fixed assets are prepared in consultation with affected landowners and a copy of the same is to be given to each land owner

Comply. Inventories of affected land/assets have been prepared in consultation with the affected land owners. Consultations were conducted to discuss the inventory of loss and compensation.

(vii). The negotiated amount will be paid immediately to landowners after all necessary documents required for the land acquisition processes have been completed by land owners.

Comply. Important documents needed to process land payments have been completed, and compensation amounts from the results of the independent appraiser have been paid to the APs in timely manner.

(viii). All market analysis, negotiation and other consultation proceedings will be documented and the land sale and purchase agreement will be signed by the negotiating parties in the presence of a Land deed official (PPAT) and the village head or community leaders

Comply. Value of compensation was provided by independent appraiser as documented in appendix. 3. Assessment Report by the KJJP Independent Team

(ix). Land acquisition identification, planning and monitoring will ensure that gender concerns are incorporated

Comply. Based on the identification by BWS field staff, there is no AH severely impacted by land acquisition, and all AHs are not considered as vulnerable group. Their income are above the poverty line and their sources of income are not coming from the acquired lands. There is also no female-headed households affected by land acquisition.

(x). Grievance mechanism will be established to receive and facilitate resolution of the entitled parties concerns

Partially comply. No complaint received by the BWS on the land acquisistion. However, no specific GRM set up for the project. Therefore, the BWS will set up the GRM for this project prior civil works commencement to accommodate any complaint for the projects of FMSRB.

(xi). DGWR will not award a civil works contract until payment has been fully provided to the entitled parties and rehabilitation measures if any.

Comply. Compensation payment has been provided to all the APs, and it was prior to the civil works contract.

42. Assessment and Compensation. As per the government regulation on land acquisition, the BWS Maluku mobilized the independent appraisers to value the compensation. The services of an Independent Appraiser were to determine the scope of impact and unit of the affected assets. Unit rates for land were determined following valuation by independent appraiser. This has been in compliance with the principles mentioned in RF that compensation is paid at replacement value which takes into account the prevalent market prices as determined by independent appraisal or through consultation with entitled parties including those without legal title to assets to enable all affected land owners to replace their affected assets. No depreciation was applied and no administrative cost and tax were deducted and taxes. Obligations were covered by the negotiated transaction. 43. Livelihood Recovery. BWS Maluku is aware and agrees that vulnerable group affected by project need livelihood/income restoration. However, based on social economy survey there is no APs considered as vulnerable. Hence the livelihood improvement programs are not needed to be budgeted and implemented by the Regional Government through the Social Action Plan (SAP) program.

B. Corrective Action Plan 44. This due diligence confirms that activities of land acquisition have been partially complied with the principles and procedure set forth in the project RF related to negotiated land acquisition. There are some issues identified and the activities outlined in the table 6 below have been prepared to address the issues and meet the principles set in the RF.

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TABLE 6. CORRECTIVE ACTIONS

No. Activities Time frame Responsible Parties

1 Disclosure of DDR on BWS and ADB web.

July 2019 BWS Maluku

2 Establishment of GRM

3 st quarter 2019 prior to construction commencement

BWS Maluku

3

Verification by independent party on negotiated land acquisition

3 st quarter 2019 BWS Maluku

4

Provide compensation and/or assistance for impact during construction as per provisions in the project RF.

Construction period BWS Maluku

5 Monitoring of impact of Land Acquisition

Starting 3 st quarter 2019 BWS Maluku

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V. APPENDICES

Appendix 1. Socialization on Land Acquisition Plan with APs

Appendix 2. Land Measurement in Petra and Yacobus Check Dam

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Appendix 3. Assessment Report by the KJJP Independent Team

a. Assessment Report by the KJJP Independent Team 2015 Years

Note: AHs recieved compensation payment in 2015

1. Istawan Mahakena (Tanah Depan Petra)

2. Istawan Mahakena (Tanah Belakang Petra)

3. Said Waliulu (Yacobus)

b. Assessment Report by the KJJP Independent Team 2017 Years

Note: AHs recieved compensation payment in 2017 1. Karim Hunsow (Petra) 2. Karim Hunsow (Yacobus)

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Appendix 4. BA Land Acquisition

21

22

23

24

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Appendix 5: Map of Land Areas that have been released

Nama : Karim Hunsow Luas : 702 m2

Nama : Istawan Mahakena (Tanah Depan)

Luas : 1.000 m2

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Nama : Istawan Mahakena (Tanah Belakang)

Luas : 529 m2

Nama : Said Waliulu Luas : 377 m2

27

Nama : Karim Hunsow Luas : 583 m2

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Appendix 6: Certificate of land acquired

29

30

31

32

33

34

35

36

37

38

39

40

41

Lampiran SPM pembayaran lahan KARIM HUNSOW lokasi Yakobus Batu Merah.

Note: Pemilik rekening atas nama Hairiayah Hunsow (Istri pemilik lahan)

No Rek: 0338016020 BNI 46 Cabang Ambon

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43

44

45

Lampiran SPM pembayaran lahan KARIM HUNSOW lokasi Petra Batu Merah.

Note: Pemilik rekening atas nama Hairiayah Hunsow (Istri pemilik lahan)

No Rek: 0338016020 BNI 46 Cabang Ambon

46

47

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Lampiran SPM pembayaran lahan A. Istawan Mahakena lokasi Petra Batu Merah dan

Kelurahan Wayhoka

Note: Pembayaran langsung digabung dua bidang lokasi (tanah belakang dan tanah depan)

No Rek: 3191519718, Bank BCA KCU. CITY TOWER Jln. Jendral Sudirman Jakarta.

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Lampiran SPM pembayaran lahan Said Waliulu lokasi Yakobus Batu Merah.

No Rek: 1102060664 atas nama Said Waliulu, Bank Maluku Cabang Batu Mera,Jln. Pantai Mardika Ambon