Documentof The World Bank Report No. 13154-IND STAFF APPRAISAL REPORT INDONESIA KALIMANTAN URBAN DEVELOPMENT PROJECT FEBRUARY 24, 1995 Infrastructure Operations Division Country Department III East Asia and Pacific Region Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
Transcript
Document of
The World Bank
Report No. 13154-IND
STAFF APPRAISAL REPORT
INDONESIA
KALIMANTAN URBAN DEVELOPMENT PROJECT
FEBRUARY 24, 1995
Infrastructure Operations DivisionCountry Department IIIEast Asia and Pacific Region
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CURRENCY EQUIVALENTS(As of May 1994)
Currency Unit = Indonesian Rupiah (Rp)$1.00 = Rp 2,154Rp 1 million = $464
WEIGHTS AND MEASURES
Metric Units
FISCAL YEAR
Government of Indonesia: April I - March 31Provincial and Local Governments: April I - March 31Water Enterprises: January I - December 31
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ACRONYMS USED
AMDAL - GOI environmental assessment processANDAL - GOI detailed environment impact assessment studyAPBD 1/11 - Annual provincial/local govemment development budgetAPBN - Annual central government development budgetBANGDA - Directorate General for Regional Development, MHABAPPENAS - National Development Planning AgencyBAPPEDA I/11 - Provincial/Local Development Planning AgencyBPKP - Central Audit BureauBPD - Regional Development Bank (Provincial Level)CPMO/FO - Central Project Management Office/Finance OfficeDATI 1/11 - Provincial/local level governmentDGCK - Directorate General Cipta Karya (Human Settlements), MPWDGBM - Directorate General Bina Marga (Roads and Bridges), MPWDGM - Directorate General Monetary Affairs. MOFDGWRD - Directorate General for Water Resource Development, MPWDPUK - Kabupaten/Kotamadya department of public worksDIP/DIPDA - Central/regional project budgetGOI - Government of IndonesiaIDC - Interest during constructionIKK - Kecamatan headquarter town[MG - ItJIDP Implementation Management Group. BAPPENASINPRES - Presidential Instruction, including a class of GOI grantsIUIDP - Integrated UIrban Infrastructure Development ProgramKabupaten - Local (Level 11) districtKampung - Urban neighborhoodKIP - Kampung Improvement ProgramKotamadya - Incorporated municipality/city (Level 11)Kecamatan - Kabupaten or kotamadya administrative districtl,IDAP - Local Institutional Development Action ProgramMCK - Communal lavatory and toilet facilityMIP - Market Improvemcnt ProgramMHA - Ministry of Home AffairsMOF - Ministry of FinanceMPW - Ministry of Public WorksMurni - Rupiah murni, or money from "pure" domestic sourcesNGO - Non-governmental organizationO&M - Operations and maintenancePADS - Pendaliatan Asli Daerah (local government taxes and charges)PBB - National land and buildings taxPDAM - Local government water enterprisePIA - Program Implementation AgreementPIL - Preliminary environmental assessmentPimpro - Project managerPIU - Project Implementation UnitPJM - Medium-Term Expenditure ProgramPMDU - Provincial Management and Development Unit (for water enterprises)PMO/FO - Local Project Monitoring Office/Finance OfficePMU - Project Management UnitPPF - Project Preparation FacilityPUtOD - Directorate General for Public Administration and Regional Autonomy, MHARAKORBANG 1/11 - Provincial/local annual budget coordination meetingRepelita - Five-year Development PlanRIAP - Revenue Improvement Action PlanRKL - Environmental Management PlanRPL - Environmental Monitoring PlanSDO - Routine central GOI grant, primarily for salariesSLA - Subsidiary Loan AgreementSK - Surat Keputusan. decree of a senior officialSPABP - Special grants to lower level governmentsTKPP - Urban Development Coordination TeamUNDP - United Nations Development ProgrammeWalikota - Kotamadya chief executive (mayor)
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INDONESIA
KALIMIANTAN URBAN DEVELOPMENT PROJECT (KUDP)
STAFF APPRAISAL REPORT
LoAN AND PROJECT SUMMARY
Borrower: The Republic of Indonesia
Beneficiaries: The Cities of Banjarmasin, Balikpapan, Palangkaraya, Pontianak,Samarinda and their respective Water Enterprises (PDAMs).
Amount: US$136 million equivalent
Terms: Repayable in 20 years including five years of grace, at the Bank'sstandard variable interest rate
Onlending Terms: Out of the loan proceeds, US$33.5 million equivalent would be onlentby the Central Government to the five municipalities and their WaterEnterprises (PDAMs) at an annual interest rate of 11.5%,,the prevailing6 month average of the 3-month Sertifikat Bank Indonesia (SBI) rate atthe time of appraisal for a term of 20 years, including 5 years grace.Both Municipal Governments and their PDAMs are fully responsible forthe interest during construction. The Central Government bears theforeign exchange risk.
Project Objectivesand Description: The main objectives of the project are to (a) increase the provision of
urban infrastructure and services and the efficiency of urbaninvestments, (b) promote stronger, more autonomous, and financiallymore independent municipal governments, and (c) contribute towardsurban poverty alleviation, mainly through better access to essentialservices and an improved urban environment.
The project would finance priority investments in the five municipalitiesin: (a) urban roads; (b) water supply and distribution systems;(c) storm drainage and flood control; (d) solid waste collection anddisposal; (e) human waste disposal (sewerage and on-site sanitationfacilities); (f) multi-sectoral programs for kampung (low incomeneighborhood) improvements, market improvements, and infrastructurefor urban renewal pilot projects and for low cost housing developments,(g) programs for the development and strengthening of local institutions,(h) programs to increase local revenue generation, and (i) technicalassistance for implementation.
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Benefits and Risks: The project would benefit the urban populations in the five citiesthrough provision of better quality and more reliable and accessibleurban infrastructure and services. The water supply, drainage, andhuman and solid waste disposal investments would greatly improve theliving environment by providing safe and reliable water, reducingproperty damage and productivity losses, and decreasing pollution andthe incidence of diseases. The urban road investments would assist thelocal economies by lowering transport costs and travel times. Kampungand market improvement investments would help low incomepopulations by bettering living conditions and local commercialfacilities. The main risks are the limited capabilities at the local levelto manage and implement investment programs. In order to mitigatethese risks, appropriate measures have been taken, such as the use otstandardized procurement documents, increased involvement of theprivate sector in O&M delivery, training of staff, introduction of anMIS system and employment of consultants, managed at the local level,to assist with implementation. Another positive factor is the strongownership of the proposed program by the five municipalities developedthrough their close involvement in the preparation process.
Estimated Costs: Local Foreign Total % of------------- (US$ million) ------------ Base Cost
Poverty Category: Targeted intervention: the KIP/MIP component (20 percent of projectcost) will favor the poorer neighborhoods and all the other componentswill also, directly or indirectly, benefit the urban poor more than thenon-poor, except probably tor the road component.
Estimated EconomicRate of Return: 15% to 40% for roads, minimum 12% for water supply, not quantified
for other components for which however benefits have been estimatedand are expected to cover or exceed costs.
Maps: IBRD No. 26065: Key Map - Indonesia and KalimantanIBRD No. 26066: Project Cities - Water and Drainage/Flood ControlIBRD No. 26113: Project Cities - Urban Roads, KIP/MIPIBRD No. 26114: Project Cities - Solid Waste and Sanitation
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INDONESIA
KALMIANTAN URBAN DEVELOPMENT PROJECT (KUDP)
STAFF APPRAISAL REPORT
TABLE OF CONTENTS
Page
1 THE URBAN SECTOR ................................ I
A. Sector Overview .................................. 1B. Government Strategy ................................ 3C. Bank Experience .................................. 4D. Bank Sector Strategy ................................ 5
2 URBAN DEVELOPMENT IN KALIMANTAN ................ 6
A. Population and Urban Services ..................... ..... 6B. Urban Planning and Financing .......................... 8C. Water Enterprises (PDAMs) ............................ 9
3 THE PROJECT ..................................... 10
A. Project Origin and Formulation ......................... 10B. Project Objectives .................................. 11C. Project Description ................................. 11D. Project Costs ..................................... 13E. Financing Plan .................................... 13
7 AGREEMENTS REACHED AND RECOMMENDATION ........ 30
TABLES IN TEXT
Table 2.1: Kalimantan's Five Project Cities ..................... 7Table 2.2: Local Taxes and Charges, 1992 ...................... 10Table 3.1: Project Cost Summary ........................... 14Table 3.2: Financing Plan ................................ 15Table 4.1: Procurement Arrangements ........................ 19Table 4.2: Expected Number of ICB and LCB Packages by Sector ...... 20Table 4.3: Disbursements ................................ 20
ANNEXES
1. Previous Urban Infrastructure Projects2. Project Descriptions by City3. Documents in Project File4. Summary Cost Table5. Financing Plan6. Implementation Responsibilities7. Technical Assistance8. Implementation Schedule9. Disbursements by City and Category10. Estimated Schedule of Disbursements11. Supervision Staffing and Schedule12. Land Acquisition, Resettlement and Compensation13. Mitigation of Negative Environmental Impacts14. Financial Projections: Kotamadyas15. Financial Projections: PDAMs16. Summary of Project Indicators
CHARTS
MAPS
The report is based on the findings of preappraisal mission in November 1993 and an appraisalmission in May 1994. The appraisal mission comprised Mmes/Messrs June Bsaies (RoadEngineer), John Darmody (Water Sector Engineer), Dianne Hughes (Sanitation Engineer),Frida Johansen (Principal Economist), Safari O'Humay (Financial Analyst), Bob Scouller(Engineer), George Soraya (IUIDP Specialist), and Keiichi Tamaki (Financial Analyst).Anupam Khanna (Chief EA31N) and Marianne Haug (Director EA3) have endorsed theproject.
1. URBAN SECTOR
A. SECTOR OVERVIEW
1 . 1 Demographic Trends. The urban population in Indonesia exceeds 55 million and isgrowing at over 5 percent per year, more than twice the overall national population growth rate. About80 million or 40 percent of Indonesians will be city dwellers by the year 2000. Indonesia's urbansettlements include 15 metropolitan and large cities of more than half a million people, 40 secondarycities of over 100,000 (provincial headquarters and incorporated municipalities), 200 small towns (districtheadquarters) over 20,000 and about 3,200 service centers (subdistrict headquarters) with 3,000 to 20,000people. Seven out of the ten largest metropolitan areas are in Java.
1.2 Institutional Framework. At the national level, there is no single ministry for urbandevelopment. The National Development Planning Agency, BAPPENAS, is responsible for overallplanning and allocation of resources, focussed on Five-Year Development Plans (Repelita) and AnnualNational Development Budgets (APBN). Within BAPPENAS, the Bureau for Urban Development,Settlement and Public Housing, under Deputy V (Regional and Provincial Development), is responsiblefor oversight and coordination of urban infrastructure development. All key agencies with responsibilitiesin the urban sector are represented in the Inter-agency Coordinating Team for Urban Development (TimKoordinasi or TKPP) chaired by BAPPENAS.
1.3 The principal central ministries involved in urban issues are the Ministry of Home Affairs,the Ministry of Public Works, and the Ministry of Finance. The Ministry of Home Affairs (MHA) isresponsible for oversight of the regional governments, primarily through its Directorate General forPublic Administration and Regional Autonomy (PUOD) and Directorate General for RegionalDevelopment (BANGDA). The Ministry of Public Works (MPW or DPU) is responsible for oversightof most infrastructure. Within MPW, the following directorates-general are responsible for urbaninfrastructure: the Directorate General for Human Settlements (Cipta Karya or DGCK) is responsiblefor oversight of city and regional planning, water supply, urban drainage, sanitation and sewerage, solidwaste management, kampung improvement programs (KIP), and market improvement programs (MIP);the Directorate General for Roads (Bina Marga or DGBM) is responsible for oversight of urban roadsand bridges; and the Directorate General for Water Resource Development (Pengairan or DGWRD) isresponsible for urban flood control and bulk water supply. The Ministry of Finance (MOF) is responsiblefor central and local finance through its Directorate General for Monetary Affairs (DGM), while theDirectorate General for Budget (Anggaran or DGA) administers budget transfers.
1.4 At the regional levels, provincial (Level I) and local (Level II) governments operate withincreasing responsibilities and delegated authority. In all, there are 27 provinces and 301 localgovernments, including 54 kotamadyas (urban municipalities) and 247 kabupatens (districts). Legislativepowers at both provincial and local levels are held by People's Representative Councils (DewanPerwakilan Rakyat Daerah or DPRD).
1.5 Provincial governments are headed by appointed governors who represent the Presidentand the central government; the governors also head the semi-autonomous provincial administrations.Bupatis (district heads) and Walikotas (municipal mayors) represent provincial governments, and headtheir own local governments. Regional Development Planning Agencies (BAPPEDA I and II) reportdirectly to their respective governors, district heads or mayors, and are responsible for planning andresource allocation. Regional government services are provided by separate departments (Dinas I andII) analogous to line ministries of the central government.
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1.6 Sectoral Coordination and Local Participation. Due to the hierarchical administrativesystem, coordination of the urban sector has been difficult and local participation in the decision-makingprocess has been limited. The large size and diversity of the country, the rapid pace of urbanization, thenumber of concerned agencies, the lack of effective management information systems and, perhaps,cultural constraints to communication within and among agencies, have led to a somewhat fragmentedapproach to urban development. In order to improve coordination, especially at the local level, GOI'spolicy of decentralization needs to be pursued more effectively.
1.7 Sector Constraints and Priorities. Average incomes in urban areas have risensubstantially over the past decade; however, income distribution remains relatively unequal and in 1990,over 17 percent of urban dwellers were estimated to be "absolute" poor based on their expenditure levels.The problems of low income are exacerbated by deficiencies in basic services and degraded environmentalconditions causing health risks among the low income population. Country-wide, only about 20-25 percent of urban households have direct access to piped water supply, another 15 percent buy drinkingwater from vendors or standposts, and the rest rely on shallow wells and sometimes on surface watercourses. Surface water courses in urban areas are frequently polluted due to discharge of inadequatelytreated wastewater. Only about 40 percent of urban households have access to adequate sanitationfacilities. In the larger cities, inadequate industrial water supply, and liquid and solid waste disposal areserious problems. To meet GOI's service and equity objectives, more investment is needed in local ortertiary systems in poorly served urban areas. The Bank's 1993 Urban Public Infrastructure ServicesReport (No. 12154-IND) estimated that the 1990 infrastructure investment backlog was at least someUS$5 billion for the main four subsectors (piped water, sewerage, urban roads, and drainage). Further,a substantial backlog prevails in the maintenance of facilities, which has resulted in decreased productivityof the infrastructure.
1.8 Sector Finances. Finances of provincial and local governments have long been dominatedby central government transfers and are characterized by weak local resource mobilization, low per-capitabudgets and limited use of credit for capital investment. The dominant role of central government grantsfor financing local government services is partly due to the limited local authority for levying taxes.Grants are a way to resolve the disparity between local needs and local resource mobilization. Althoughgrant allocation criteria have been modified to respond better to local needs and shortfalls (compared tominimum standards), there is a need to relate grant allocations more to performance and productivity.The larger infrastructure projects are financed directly from the national budget (APBN/DIP) and areexecuted by the regional offices of central government agencies. These projects sometimes lead tooperations and maintenance (O&M) obligations which the local governments are not fully capable oftaking on.
1.9 Urban Infrastructure Issues. The main problems and issues faced by cities are: (a) largeinfrastructure deficiencies and O&M backlogs; (b) lack of coordination in integrating infrastructureinvestments with land management and transport objectives; (c) weak management of water enterprisesand municipalities, as evidenced by deficient accounting practices, the lack of adequate cost recovery,revenue generation, and little use of credit as well as poor information systems; (d) inefficientprogramming of the design and construction cycles, often compressed into single fiscal years; (e) complexrelationships among local, provincial and central agencies with respect to responsibilities for project andprogram preparation, appraisal, financing, implementation, and O&M; (f) shortage of trained andexperienced managerial and technical personnel at all levels; and (g) limited involvement of the privatesector in urban service provision.
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B. GOVERNMENT STRATEGY
1.10 IUIDP Approach. With large deficiencies in urban infrastructure and a fast-growingurban population, GOI's strategy in the past has emphasized physical infrastructure targets: length ofroads to be built, percentage of population to be supplied with piped water, sanitation services, etc.These targets have a prominent place in the five year national development plans (Repelitas). In 1987,GOI issued a Statement of Policies, representing a consolidated view of development in the sector. ThisPolicy Statement for Urban Development, incorporated in Repelita V (for the period 1989-94) includes:(a) strengthening local governments to build, operate and maintain local services; (b) improving theplanning and programming of urban infrastructure investments; (c) mobilization of local revenues andthe optimization of their use; (d) implementing coordinated financing and administration systems for localservices; and (e) strengthening consultative processes at various levels of government, particularly theparticipation of municipalities and districts.
1.11 GOI's Policy Statement called for Integrated Urban Infrastructure Development Programs(IUIDP) as the operational approach for achieving the above objectives. The policy was translated intoaction plans for local institutional reforms (Local Institutional Development Action Plan or LIDAP) andimprovements in local resource mobilization (Revenue Improvement Action Plans or RIAP), sectorplanning, and financing arrangements. GOI is providing (with domestic funds) further support to thereform effort of the local government revenue departments (DISPENDA), initiated under the Urban Vproject. GOI has continued to develop the IUIDP process to emphasize the following priorities: (a)expanding the scope of the IUIDP process to include additional subsectors which are important inpromoting the economic development of cities; (b) strengthening local government institutionalcapabilities; (c) improving O&M of urban infrastructure; (d) improving cost recovery and implementationof a more fully integrated system for the financing of urban infrastructure services; and (e) increasingattention to urban land and environmental management.
1.12 GOI has issued regulations and policy clarifications to operationalize urban sector policyand the IUIDP approach; with World Bank, Asian Development Bank (ADB) and bilateral assistance,GOI has undertaken a nation-wide program for IUIDP preparation and implementation since 1987; andUNDP and UNCHS have supported a central assistance team to the IUIDP Management Group (IMG).More than 50 percent of local governments have so far adopted IUIDP planning.
1.13 Local Borrowing. Under Repelita V, GOI has also given priority to the expansion ofborrowing by local governments and their water enterprises. To induce a higher level of credit financing,GOI has adopted less conservative financial criteria for borrowing by local entities (debt service coverageratio of not less than 1.5 for local government general fund operations and not less than 1.3 for localenterprises like water supply PDAMs). This has brought the legal borrowing capacity of localgovernments, particularly the larger municipalities, more in line with their considerably underutilizedfinancial capacity. GOI's strategy is to move interest rates toward market rates over the medium to longterm, but suitable reference rates reflecting market rates for long-term borrowing still need to be defined.
1.14 Repelita VI. Repelita VI and the 25 Year Plan II, both of which started in April 1994,emphasize sustainable urban development through improvement in the quality of the living environment,support for economic growth, reduction in regional imbalances, and poverty alleviation. Whilecontinuing the basic premises of Repelita V and the National Policy Statement for Urban Developmentmentioned above, Repelita VI takes a broader approach by expanding the IUIDP into an Integrated UrbanDevelopment Program (IUDP) that includes: (a) a larger number of smaller cities and towns; (b) broaderspatial planning and urban planning in addition to public works infrastructure development plans; (c)expanding the scope to cover low income and rental housing, infrastructure provision for low-income
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areas, and urban renewal; (d) involving the private sector and communities to a greater extent; and (e)strengthening environmental sustainability. To accelerate decentralization and implementation of plans,emphasis will be placed on better use of resources, mobilization of local revenues, developing financingmechanisms, and increasing cost recovery by municipalities and their agencies. Better coordination andstrengthening of local agencies will also be sought.
1.15 Environment and Resettlement. In late 1993 the GOT enacted Law 51/93 onenvironmental impact assessment and mitigation and monitoring measures, and Presidential Decree,Kepres 55, on land acquisition for public facilities, to improve on earlier decrees and their application.Law 51 makes further refinements to GOI's environmental assessment procedures, which were alreadyin line with Bank policies and consistent with best practices under Bank-financed projects. Decree 55seeks to ensure adequate access to information, fair negotiations, compensation awards based on marketvalues, and rights of appeal to the courts. A first tier of implementing regulations and guidelines wasissued in March 1994 for Law 51. Kepres 55 still has gaps primarily in the areas of entitlementeligibility and funding sources, and time will be required to develop implementation capacities based onlocal experiences.
C. BANK EXPERIENCE
1.16 Overall Sector Experience. The Bank has been involved in the urban water supply sectorsince the 1960s, with relatively little change in approach. While many projects have provided substantialeconomic and health benefits, the experience indicates: (a) supply of water has lagged behind increasingdemand; (b) delays in project implementation are common; (c) improving institutions and achieving cost-recovery have been slow and difficult; (d) water quality is a persistent problem; and (e) disposal of wastewater in densely populated areas has been difficult.
1.17 Bank involvement in the urban sector started in the early 1970s with low cost investmentprojects in shelter, water supply, sanitation, and urban transport, aimed at alleviating urban poverty.Sites and services and slum upgrading projects were to demonstrate replicable approaches benefitting thepoor, while recovering costs and reducing the financial burden on the public sector. Many of theseprojects succeeded in physical terms, but had little impact on the policies of national and localgovernments and on urban management. The Bank had not paid adequate attention to the policy andinstitutional requirements for improving the productivity of the urban economy and reducing urbanpoverty, and improving management of the urban environment. Further, as many of the urban programsdid not achieve sustainable policy reform and institutional development, project approaches were generallynot replicable outside the framework of Bank financial support.
.18 By the mid-1980s the experience of donor-assisted projects had led to shifts in approachesto the urban sector. It was recognized that central governments alone were unable to meet the increasingneeds for infrastructure services of rapidly growing urban populations and greater efforts had to bedevoted to: (a) improving the management capability of urban institutions and inter-governmental fiscalrelations; (b) improving local resource mobilization; (c) enhancing the management and quality of urbaninfrastructure, particularly with regard to maintenance; (d) establishing enabling rather than constrainingregulatory frameworks; (e) expanding financial services for urban development; and (f) promoting privatesector participation in urban service delivery. Recent initiatives by governments and donors in these areasreflect a growing appreciation of the importance of policies, institutions, and regulations in formulatingeffective strategies to manage urban growth.
1 .19 Experience in Indonesia. The Bank has financed 12 completed and 8 ongoing urban andwater supply projects in Indonesia since 1974, for more than fifty local governments and many of theirwater enterprises (see Annex 1). Urban lending operations in Indonesia have progressed fromdemonstration projects in Jakarta through more programmatic investments in selected other large cities,to sector lending within an agreed policy and institutional framework (although still limited in terms ofarea and subsectoral scope). Water supply projects initially covered only a few cities at a time, but later,like Bank projects in other countries, assisted a large number of urban settlements under one operation.Details concerning Bank-funded water and urban infrastructure projects are available on file. In urbantransport projects, or the transport components of urban development projects attention has focussed onroad construction and maintenance. Even so, implementation of road schemes has been slower thanexpected, quality of construction was frequently an issue related to reduced facility lifespan. Inadequateattention has been given to traffic management, to improvement of public transport services and facilitiesfor pedestrians.
1.20 Bank experience confirms that: (a) limited planning and implementation capacity at thecentral government level, and the difficulties inherent in providing essentially local services by centralgovernment departments, reduces the efficiency of mass delivery programs; (b) capacity building at thelocal level is a long-term process that needs to be accompanied by training to achieve an increase in localresponsibility and accountability; and (c) to develop such responsibility and accountability, central-localfinancial relations need to provide more local government autonomy and enable private sectorinvolvement. The proposed project design takes into account these lessons. Significant responsibilityin project implementation will be handled by the local governments and their water enterprises; suitabletraining in project management, local revenue administration, and improvements in operations andmaintenance will be provided; and management advisory services will be provided to the waterenterprises.
D. BANK SECTOR STRATEGY
1.21 The Bank has oriented its overall sector lending to assist the Government to deliveradequate urban infrastructure services in cost-effective ways. GOI and the Bank emphasize improvementsin: (a) service levels, in a regionally balanced fashion, and particularly for the poor; (b) urbanproductivity and the effectiveness of investments through better infrastructure planning and programming,especially at the city level, and through enhanced local government capacity for fiscal management,revenue mobilization, project implementation and O&M; and (c) the urban environment by enhancinglocal government capacity to plan, build and operate infrastructure in an environmentally sound fashionand also by enhancing community participation.
1.22 In promoting efficient urban development, the Bank's strategy supports the expanded IUDPapproach; however, implementation should include both sectoral and integrated approaches asappropriate. While all plans should be integrated, in some cases, implementation could be handledthrough separate sectoral projects. For example, in smaller municipalities multisectoral projects aregenerally of manageable size and complexity; an integrated investment approach would, therefore, bemore appropriate. In other cases, where the requirements of a particular sector are sufficiently large andcomplex, both in technical terms as well as on policy, institutional and financial matters, sectoral projectswithin the framework of an integrated plan may be better.
1.23 Improving local management capacity is another area where the Bank's strategy is alignedwith that of GOI. Local governments and local institutions such as PDAMs should have well qualifiedand well trained staff. In addition, local resource mobilization and retention should be increased. These
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issues could be addressed through revenue improvement programs, greater attention to tax collections,pricing policies to effect cost recovery (O&M costs and a portion of or full investment costs), flexibilityto use funds as needed in priority areas, and increased local borrowing at market interest rates. The Bankalso recognizes that the infrastructure deficiencies are large and that the financial capabilities of localinstitutions are limited in the short run; GOI has most tax bases and transfer grants will therefore continueto be an important source of local financing. In order to optimize their use, grants should be allocatedon an incentive basis.
1.24 The Bank's strategy also promotes establishing an enabling regulatory and planningframework for urban land management. A key focus of the Bank's strategy will be to support GOIefforts to establish an effective land management system and simplify other regulations to facilitate moreefficient and environmentally sound urban land use and strengthen land tenure. The Bank is helping theGovernment develop improved implementation frameworks for addressing environmental and socialimpacts of urban projects.
2. URBAN DEVELOPMENT IN KALIMANTAN
A. POPULATION AND URBAN SERVICES
2.1 Population. The Indonesian region of Kalimantan covers the southern three-quarters ofthe island of Borneo that is located north of Java. It comprises some 30 percent of Indonesia's total landarea, but no more than 5 percent of the country's population, and even less of its urban population. Theregion is divided into the four provinces of West, Central, South and East Kalimantan.
2.2 Kalimantan's most developed urban areas are the three coastal cities and old trading portsof Pontianak (West Kalimantan), Banjarmasin (South Kalimantan) and Balikpapan (East Kalimantan) andthe inland cities of Samarinda (old center of East Kalimantan) and Palangkaraya (new capital of CentralKalimantan). Except for Balikpapan, the cities are provincial capitals. Palangkaraya is located some 60km inland, accessible only by water and air. All five cities are located on at least one major river thatprovides them with access to their extensive hinterlands; navigable waterways are the transportationbackbone in Kalimantan. Roads have been developed in and around the major cities but interurban roadsare few, the main ones lying between Balikpapan and Samarinda and in the valley northeast ofBanjarmasin.
2.3 In 1990, about 28 percent or 2.5 million people of Kalimantan's 9.1 million populationlived in urban areas. East Kalimantan contained more than one third of Kalimantan's urban population,slightly less than one third lived in South Kalimantan, one quarter in West Kalimantan, and less than 10percent in Central Kalimantan. East Kalimantan has the highest ratio of urban to rural population ofKalimantan's provinces, followed by South Kalimantan (about one quarter), West Kalimantan (one fifth)and Central Kalimantan (slightly more than 15 percent). The five largest cities comprised 1.9 millionpersons by 1993.
2.4 During the 1980s, Kalimantan's population grew on average at 3.1 percent per annum,compared to an urban population growth rate of 5.7 percent. Most of the urban population increase inthe decade was absorbed by Kalimantan's five major cities; on average, the increase was 60 percent(ranging from 35 percent in Banjarmasin to 100 percent in Palangkaraya). During its rapid expansionin the 1970s and for the most part of the 1980s, Kalimantan's economy attracted labor from other islands,with in-migration occurring in particular in the industrializing cities of Samarinda and Balikpapan, whereoil, gas and timber dominate the economy, and Banjarmasin, the center of plywood and rubber processing
industries. Kalimantan's rural populations decreased-except for Palangkaraya where rural populationalmost doubled (although from a relatively low base). Between 1980 and 1990, rural populations shrunkon average by nearly 40 percent.
TABLE 2.1: KALIMANTAN'S FIVE PROJECT CITIES
Total Pontianak Banjarmasin Balikpapan Samarinda Palangkaraya
1990 prov. GDP West K. South K. East K. East K. Central K.$/capita 425 460 1,670Lb 1,670Lb 490
Sources: BPS; Project Preparation Report.
/a For the kotas; growth in suburbs was normally higher, with average urban population growth of 5.7% inKalimantan in the 1980-90 decade.
/b Excluding direct oil and gas revenues, most of which accrue elsewhere.
2.5 In 1990, regional GDPs varied markedly among the provinces; from Rp 1.4 trillion inCentral Kalimantan to Rp 10.8 trillion in East Kalimantan, of which about Rp 6.4 trillion due to oil, gasand related products. Likewise, per capita regional GDPs varied greatly, from about Rp 850,000 ($425)in West Kalimantan to Rp 3.3 million ($1,670) without direct oil, gas and related product revenues thataccrue only in part to the local populations, in East Kalimantan. Despite these relatively high averageGDPs per capita, Kalimantan's provinces still have considerable poverty: some 30 percent of thepopulation in West Kalimantan, 20 percent in Central Kalimantan, and some 15 percent in South and EastKalimantan, are estimated to be "absolute" poor.
2.6 Urban Services. There are significant backlogs in urban infrastructure services. In thefive cities, between one quarter and less than half of the population is supplied with water by localPDAMs, either in the form of house connections (20-38 percent) or public taps (2-8 percent). In 1993,the five water enterprises sold piped water at average tariffs between Rp 415 (Palangkaraya) and Rp 681(Balikpapan) per m3 , and minimum tariffs between Rp 230 and Rp 421 per rn3 . Per capita waterconsumption from house connections varied from less than 80 liters per day in Pontianak andPalangkaraya to 140 liters in Samarinda- and 20-30 liters per capita per day from public taps. Servicetends to be rather unreliable, in particular during dry seasons. Most people depend on low-quality waterfrom shallow wells, rivers and canals as well as rain water, and on high-priced water bought fromvendors or neighbors.
2.7 Between half (Banjarmasin) and more than three quarters (Balikpapan) of the householdsare equipped with on-site sanitation facilities, either in the lorm of septic tanks or pit latrines. Theremainder of the population uses public sanitation facilities or open places and rivers for their toilet needs.In addition, the cities have few desludging facilities and disposal sites, and public as well as privatesanitary facilities are poorly maintained. In particular, overflowing septic tanks result in fecalcontamination of ground (shallow well) water and thus cause water-borne diseases like diarrhea and skindiseases. High water tables make standard on-site sanitation technologies ineffective and alternativesolutions are required.
2.8 Only 50-60 percent of the population has solid waste collection in the five cities. Whilein Samarinda about three-quarters of domestic waste gets collected, it is only one-third in Pontianak.Frequently, households dispose of their waste by either burning it in their yards, or by dumping it neartheir homes or into the nearest river. Burning waste contributes to air pollution; waste accumulation inrivers and canals reduces the capacity of the drainage system, and contaminates river and coastal waters.Service levels for non-domestic waste collection tend to be relatively high, varying between 75 and 100percent. However, municipalities lack environmentally-sound final disposal sites, and adequate collectionand transfer facilities.
2.9 Flooding is a major environmental problem in the five low lying cities covered by KUDP.Along the rivers, land is often below the high tide water level. Due to insufficient drainage and floodcontrol capacities, which are at least partly attributable to poor maintenance, floods bring contaminatedwater into direct contact with mostly lower income people. Floods also affect buildings and disrupttraffic.
2. i0 Rapid growth in motorized urban traffic--about one motorized vehicle every 10 personsin 1990--narrow roads, rights-of-way encroachment, and inadequate traffic management measures, haveresulted in frequent traffic congestion, in particular in the central business districts. In the absence ofeffective pollution control measures by central government (e.g., by requiring emission standards andcleaner engines and enforcement strategies and measures), as well as of local measures to reducecongestion, air pollution affects the health of urban populations. It is in particular the poor who are moreexposed to detrimental environmental conditions and, thus, to health risks.
2.11 Deficiencies remain both in coverage and quality of services as in Indonesian citieselsewhere, specifically in or related to: (a) transport infrastructure and planning capability to guide urbangrowth and traffic engineering and management to make the most of existing facilities; (b) waterdistribution and/or bulk water supply; (c) micro-infrastructure and services and effective and safe low-costsanitation techniques in the kampungs, where most low income people live; (d) policies and operationalprograms for: (i) O&M of infrastructure and utility services; (ii) revenue generation and the use ofmunicipal borrowing; (iii) private sector participation in delivery of municipal services; and (e) complexrelationships between municipal and central government authorities with respect to preparation, appraisal,financing and implementation and O&M of infrastructure services.
B. URBAN PLANNING AND FINANCING
2.12 Development Planning Framework. The problems call for an efficient metropolitandevelopment strategy matched with a balanced intersectoral investment program using low-costtechnologies where practicable. The poorer communities can participate in upgrading their infrastructure,without moving out. Much of the growth will continue to take place at the cities' peripheries and theneed to expand investments there, particularly in basic services, is high. Without adequate spatial
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planning, the cost of providing these services rises rapidly and unnecessarily over time, andenvironmental resources are lost or degraded.
2.13 Each of the five kotamadyas has prepared a master plan containing the main planningguidelines for urban development, in accordance with central government guidelines. The master plans,which cover 20 years, were officially approved around 1986; detailed spatial plans were ratified in 1987by Local Government Regulation No. 8. The broad nature of the master plans as well as changingsocioeconomic factors justify the preparation of more detailed 5-year plans (PJMs); PJMs have beenprepared in the cities since about 1990.
2.14 Central Grant Dependency. Infrastructure investments in Kalimantan cities have notmatched the rapid growth of the five urban areas. Like other Indonesian local governments, the fivemunicipalities under the KUDP are dependent on central transfers to a considerable extent because of theprevailing centralized tax structure.
2.15 Local Revenues. Local governments' main non-grant revenue sources fall into threecategories: local government taxes; local service charges; and assigned central government revenue.Growth in local revenues has been fairly good overall in recent years with Palangkaraya and Samarindadoing better than the others. PBB (land and building tax) is the largest of these sources in EastKalimantan and the lowest in South Kalimantan (Table 2.2). Registration, valuation and assessment dutiestor this centrally administered tax are performed by local offices of the Directorate General of Taxationof MOF. However, major parts of the collection work relating to PBB are performed by, or under thesupervision of, the local governments; 64.8 percent of the gross proceeds, irrespective of the collectingagency accrues to local government.
2.16 Borrowing. Local governments, apart from their own enterprises, have not made muchuse of borrowing for capital projects. Savings after routine expenditures are generally too low to coverany level of debt service. Until recently local governments were required to restrict the levels of theirborrowing by reference to the "debt service ratio" criterion, broadly defined as the ratio of debt service(principal repayments plus interest charges) payable in a year, to total revenues available for developmentin that year. However, the application of that criterion was unclear and open to varying interpretations.The maximum permitted ratio was 0.15, which was very conservative. GOI has recently decided toreplace it with one based on a more closely defined minimum "debt service coverage ratio" (DSCR).This has been stipulated for any given year as: [projected grant and local revenues for the year in questionless projected routine account expenditure on staff, administration and O&M needs] divided by [totalestimated loan charge obligations (interest charges plus principal repayment) arising in that year fromcurrently outstanding loans and future proposed borrowing]). The minimum ratio required is 1.5.
C. WATER ENTERPRISES (PDAMs)
2.17 The five largest PDAMs of Kalimantan are located in the five project cities. All PDAMssuffer from weak management and shortage of skilled personnel partly due to the less attractive conditionsof employment the local governments offer and the limited training the staff receive. The managementis normally appointed by the mayor and does not have operational autonomy. All PDAMs are organizedand managed according to national guidelines for water enterprises, which stipulate ownership andoperation by local governments, establishment as a local enterprise, the use of the accrual accountingconvention, and adoption of the National Standard Water Rate Structure (NSWRS) for tariffs. Tariff ratesvary depending on the cost structure of the enterprise and the make-up of its commercial base. Theauthority to set the tariff rates sits with the local parliament, as does the distribution of profits.
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Table 2.2: LOCAI, TAXES AND CHARGES, 1992(In Rupiah million)
2.18 All PDAMs are required to prepare annual financial reports for audit either by the BPKPor public accountants. Financial reports to 1993 have been audited. The financial reports of the last fouryears indicate a range of performances from very weak to generally sound. Of the five PDAMs, onlyPalangkaraya has growing operating deficits, and it also has the lowest tariffs. PDAM Balikpapan wasable to cover its O&M expenses except for 1992 partly due to an expansion in the distribution system,and a new treatment plant of 250 I/s which were completed in 1989 and 1991 respectively. PDAMsBanjarmasin, Samarinda and Pontianak showed relatively stable financial results, Samarinda showingbetter performance; however the PDAM Banjamasin recently received an Italian loan to expand its supplycapacity that will strain its finances.
3. THE PROJECT
A. PROJECT ORIGIN AND FORMULATION
3.1 In Kalimantan, the IUIDP process began in 1988 when a decision was made to assist thefour provincial governments prepare multi-year expenditure programs based on priority infrastructureneeds, and related financing packages, for the five largest cities on the island, including their waterenterprises. The preparation process itself is seen as a first phase of the project. The assistance forpreparation was provided through consultant services funded initially under the Urban Sector Loan (No.2816-IND) and subsequently supplemented by a PPF; the technical assistance services were managedoverall by DG Cipta Karya. A first full project preparation report (30 volumes) was completed in August1992. This report required some revisions, and an in-house team of staft drawn from IMG, Bina Marga,and Cipta Karya in collaboration with local governments, was set up in May 1993 to finalize thepreparation of the project. A revised report became available in October 1993, and a final report wascompleted in May 1994. The preparation phase has been long for a variety of reasons, some withpositive effects on the design and ownership of the project in each city. First, there was a question ofthe novelty to the local and provincial staff and their authorities, of the concept of integrated multi-yearprogramming embodied in the IUIDP process; consultants had to work hand in hand with the local teams,who were being exposed to new planning approaches; second, Cipta Karya could not adequately supervisethe preparation work of the consultant and local teams due to staff constraints; third, there was lack ofclarity concerniiig the size and both sectoral and geographic scope. However, the efforts have paid off;
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the cities have been following the IUIDP approach for their own expenditure planning since about 1990and have been closely involved in completing project preparation, and the in-house effort, assisted by aminimum of consultants, was a learning-by-doing exercise that has increased Cipta Karya's capability.
B. PROJECT OBJECTIVES
3.2 The 1994 Bank Group's Country Assistance Strategy for Indonesia, presented to the Boardshortly before the proposed project was appraised, highlighted the need to focus on interregional equity,delivery of higher quality services and enhanced competitiveness in a climate of macroeconomic stability.The 1995 CAS further endorses the Government strategy of outward-oriented, labor-intensive growth,more targeted delivery of social services, and more region-specific interventions. This will be addressedthrough a lending program of smaller, regional and more locally managed investments to overcomebottlenecks in infrastructure services and human resource development; decentralizing responsibilities andincreasing community participation are also part of the objectives, as is reducing pollution andenvironmental sustainability. This project is part of a series of urban development projects supported bythe Bank under the IUIDP framework in line with the above objectives. It will make a contribution inthese areas in the five largest cities in Kalimantan and has the following principal objectives: (a) improvethe provision of urban infrastructure services and the efficiency of urban investments, (b) promotestronger, more autonomous, and financially more independent municipal governments and PDAMs,(c) contribute towards poverty reduction, mainly through better access to essential services for the urbanpoor, and (d) improve the urban environment.
C. PROJECT DESCRIPTION
3.3 The project will support a 5 year program of high priority expenditures in the five cities(Banjarmasin, Balikpapan, Palangkaraya, Pontianak and Samarinda) in roads, water supply, drainage andflood control, human waste management, solid waste management, and KIP/MIP and infrastructure forpilot urban renewal schemes, complemented by local institutional development action programs toincrease the capacity of implementing agencies and revenue improvement action plans to improve weakmanagement and revenue generation and collection. The project is summarized below and is describedby city in Annex 2. The detailed plans, by year and financial source by component (the PJMs) are inseparate reports in project files (Annex 3).
3.4 Water Supply. The proposed project component includes in the five cities, investmentsin water treatment plants and transmissions and distribution networks, to increase and balance thesystems' capacities; also, investment in rehabilitation and leakage control, to reduce the high proportionof non-revenue water; and increased operations and maintenance. In all, the expenditures will allow some105,000 new connections to the piped water system, more reliable services, and better quality water.Feasibility studies and systems' optimisation studies have identified the exact sizes and lengths of pipes,reservoirs and booster pumps needed and their location in the cities for increased piped water distributionin accordance with estimated demand; preliminary engineering studies have been prepared defining thesize, type and location of new water treatment plants and their intakes; programs for leakage control,house and bulk water meter replacement and new installation are planned early under the project. Whilethe distribution systems will be laid in rights of way of roads, some land acquisition is necessary for 5new water reservoirs--a total of about I hectare--affecting, but not displacing, 5 families. Detailedengineering and procurement documents will be prepared under the project. The project will also assistin financing supervision of the works.
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3.5 The project also includes a) studies to identify future raw water sources; the currentsources in some cities are river locations subject to tidal variation and sea water intrusion; b) advisoryservices to improve management, operations and finances of the PDAMs.
3.6 Urban Roads: The five cities have an urban road network of some 1000 km includingnational, provincial and local roads. The project would improve its routine maintenance, contribute toperiodic overlays/rehabilitation of some 125 km and improve (widen, upgrade or other works) some 280km. In addition, the project would assist in constructing 30 km of new major roads needed toaccommodate traffic flows. Traffic management programs would be implemented in four cities.
3.7 Routine and periodic maintenance needs have been identified with the assistance ofconsultants and DGBM/Binkot, following accepted standards in the road administration. Costs have beenbased on standard material volumes and unit rates from previous contracts. Road improvements have beenprepared to preliminary design stage, in accordance with the function/traffic on the road. Final designsand procurement documents will be prepared as needed under the project. The new major roads--duallingthe airport access road in Pontianak, a new ring road/airport access road in Balikpapan and a new ringroad in Banjarmasin--require detailed designs, that will also be done under the project. The final designof the Banjarmasin ring road will include an environmental study to protect the wetland the road willtraverse.
3.8 Solid Waste Management: The component consists of construction of new final disposalsites for each city, procurement of bulldozers, dump trucks and containers and construction of transferstations. Some 32 ha have to be acquired for landfills, transfer depots and interim disposal sites in thefive cities. The identified landfill sites are on vacant land in low density suburbs. Care will be takenin not disrupting recycling activities currently undertaken by private operators.
3.9 Sanitation/Human Waste Disposal: The component includes construction of on-sitefacilities, including pilot schemes, of pilot sewerage/interceptor schemes and of septic sludge disposalsites, within the solid waste disposal sites, and procurement of septic sludge disposal trucks. The highwater tables of the project cities make technically ineffective standard on-site sanitation solutions. Theproject will try to identify more appropriate and cost-effective technologies through collaboration of thecentral and local public work agencies and communities in Banjarmasin, in a pilot effort. The results willbe used in the other cities, and education campaigns, especially targeted at women, will be undertakento improve sanitation.
3.10 KIP/MIP/Infrastructure for Low-cost Housing: This component aims at improving allpoor kampungs by 1999: 64 kampungs with an area of about 1000 ha would be upgraded throughprovision of roads/paths, drainage, sanitation and water supply, with community participation. Theproject would also provide infrastructure, mainly roads, for new low-cost housing developments coveringa total area of about 100 ha, and roads for 3 pilot urban renewal programs, covering 64 ha in down-townareas. And, the project would improve the infrastructure of 29 markets, with an area of 134 ha in verypoor condition.
3.11 Preliminary surveys and estimates have been made of the KIP/MIP needs by local andcentral agencies; consultants under the project will help in finalizing consultations with beneficiaries, finaldesigns/preparation and procurement documents either for small local contractors or for materialpurchases for self-help works. Preliminary designs have been prepared for the pilot urban renewalprograms, that will be undertaken with private participation outside the scope of the project; the projectwill assist with final design preparation of roads/paths and their construction. The new low cost housing
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developments are being built by GOI's housing agency, and the project will assist with the needed roadsand water supply. No land acquisition is required for these components.
3.12 Drainage: This component includes rehabilitation and improvement of primary andsecondary drains, normalization of river banks and deferred and incremental O&M. The final designsfor the drainage components will incorporate flood control system needs and will review the usefulnessof hydraulic flushing gates for selected locations.
3.13 Project Implementation Support TA: As described above, the project providesengineering services to help with final designs of works in the program and supervision of theirconstruction to be done by contractors. The administrative budget to handle the increased workload, 2percent of the base costs for water supply and 4 percent for other sub-sectors, has been included in theproject cost and will be provided domestically.
3.14 Institutional Development TA and Training: This component consists of assistance forprogram management and monitoring, municipal management, improved environmental and resettlementpractices, institutional capacity-building for each of the agencies and technical and management trainingfor the water enterprises. The project also includes assistance to Bappenas to further, country-wide, theIUDP concept and practice. The project includes the preparation of strategic urban plans and of medium-term expenditure programs (PJMs) to follow the proposed project period, but envisages that alternativesources of finance will be found later, when needed. Annex 7 provides a summary of the proposed TA.
D. PROJECT COSTS
3.15 The total cost of the project, as summarized in Table 3.1 is estimated at Rp 541.2 billion(US$251.3 million equivalent) including contingencies of Rp 78.8 billion (US$36.6 million) over theproject period, and taxes and duties of approximately Rp 45 billion (US$21 million). Direct and indirectforeign costs are estimated Rp 177.9 billion (US$82.6 million or about 33 percent of the total projectcosts). Base costs have been estimated as of appraisal date. Physical contingencies for civil works andequipment are estimated at 8 percent and price contingencies are estimated at 9 percent of the base costover the implementation period; physical contingencies are lower than average in other projects due tothe program nature of this project; cost of subprojects reflect preliminary estimates but the globalenvelopes are relatively firm, under the PJMs. Price contingencies reflect current Bank estimates ofdomestic (5 percent) and foreign (2.5 percent) inflation until 2001 and front loading of implementation.Interest during construction is estimated at US$1 1 million equivalent. The base cost of implementationsupport, engineering and supervision, is US$10.3 million (5 percent) and that of technical assistance andtraining, is US$1 1.7 million (5 percent). The share of total costs by city is as follows: Balikpapan 19percent, Banjarmasin 28 percent, Palangkaraya 11 percent, Pontianak 25 percent, and Samarinda 16percent. Details are in Annex 4.
E. FINANCING PLAN
3.16 The proposed Bank loan of US$136 million equivalent would repay the PPF of US$1.45million (plus accrued charges and interest) and finance 54 percent of total project costs, or about67 percent of the project costs net of identifiable taxes, increased administration budget costs andincremental O&M expenditures. The loan would cover foreign exchange costs of investment estimatedat US$75 million equivalent and local investment costs of US$61 million equivalent. Counterpart fundingwould be provided by the central government (US$42.9 million equivalent), provincial governments(US$3.2 million equivalent), local governments (US$41.0 million equivalent), and water enterprises(US$28.2 million equivalent). Further, the central and local agencies will fully fund current O&M for
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Table 3.1: PROJECT COST SUMMARY
Rp billion $ million % ofLocal Foreign Total Local Foreign Total Total
Total Project Cost 363.3 177.9 541.2 168.7 82.6 251.3 118
Note: Due to rounding, totals may not add up.Base costs are in May 1994 prices.
infrastructure and interest during construction on subloans under their respective responsibilities estimatedto add US$48 million to the project cost. Annex 5 provides details of the financing plan; a summary isprovided in Table 3.2 below. Final financing plans for the central and local governments and PDAMswere confirmed during negotiations, and assurances were obtained regarding timely provision ofcounterpart funds. Budget approvals will be issued each project year by January 15 for PDAMs and MayI for other agencies.
3.17 On-lending. Of the Bank loan to the GOI, Rp 28 billion and Rp 44 billion (US$13million and US$20.5 million equivalent) are to be on-lent by the central government to the kotamadyasand to the water enterprises. The amount of borrowing was determined on the basis of the willingnessand financial capability of local governments and water enterprises to borrow under subsidiary loanagreements (SLAs) satisfactory to the Bank. Proceeds of the subloans would cover 91 percent of thecosts (excluding administration costs) to the kotamadyas and water enterprises under the project. Centralgovernment will bear the foreign exchange risk and the risk of interest rate variation. The lending termsof funds onlent through SLAs are for 20 years, including five years of grace and will carry a fixedinterest rate. The interest and commitment charges would be paid during the grace period. The interestrate for subloans is 11.5% p. a., the six-month average of the three month Sertifikat Bank Indonesia (SBI)rate prevailing at the time of appraisal. The onlending rate and amounts and draft SLAs were agreed atnegotiations. Final SLAs acceptable to the Bank should be completed for loan effectiveness and the
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Table 3.2: FINANCING PLAN
Local Foreign Total Local Foreign Total Percentage------- (Rp billion) ------- ------ (US$ million) ------
Central Government 87.2 5.2 92.4 40.5 2.4 a/ 42.9 17
Provincial Government 6.9 - 6.9 3.2 - 3.2 1
Local Government 84.0 4.3 88.3 39.0 2.0 a/ 41.0 16
PDAMs 53.2 7.5 60.7 24.7 3.5 a/ 28.2 11
IBRD 132.0 160.9 292.9 61.3 74.7 136.0 54
Total Financing 363.3 177.9 541.2 168.7 82.6 251.3 100
Interest During Construction (municipal & PDAM) 10.7 - 10.7Current O&M (municipal & PDAM) 27.6 9.2 36.9
38.3 9.2 47.6
a/ On incremental O&M, fully financed domestically.
overall SLA mechanism will also be discussed in the framework of a sectoral dialogue, as recorded inminutes of negotiations.
3.18 Central Government Non-Repayable Financing. Of the total central financing of projectcosts which are non-repayable by the local agencies, one part, Rp 44.2 billion (US$20.6 millionequivalent) consists of the formula driven and ad-hoc development grants (INPRES Dati II and INPRESJalan) that provide cash supplements to regional budgets (Annex 5). The other part, Rp 309.5 billion(US$143.7 million equivalent), consists of central government development budget (APBN) funds, whichcan also be divided into two parts. One part, about Rp 221.5 billion is for infrastructure and technicalassistance and is classified as central government responsibility. These are APBN DIP (national project)funds and would be distinguished in practical terms by having central government staff as projectmanagers (Pimpros) and assistant managers (Pimbagpros) responsible for signing contracts. The otherpart (Rp 88 billion) is central government grants to local and provincial governments on the basis of anapproved multi-year expenditure program (SPABP) for infrastructure and TA classified as provincial orlocal responsibility. Typically the projects financed under the SPABP are implemented and managed bythe staff or project managers of the local governments.
3.19 Regional Financing. About Rp 156.0 billion (US$72.4 million equivalent) or 28 percentof the total project costs would be financed from regional level resources. These resources include waterenterprise operating revenues (Rp 60.7 billion), second level regional government taxes, assignedrevenues, service charges and other local revenues (Rp 88.3 billion), and contributions from theprovincial government budgets (Rp 6.9 billion).
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3.20 Retroactive Financing. Retroactive financing for project expenditures started after May1994 hut before loan signing, could facilitate project implementation. Expenditure incurred for civilworks contracts and technical assistance and engineering services, would be eligible tor up to US$5million. Procurement should be in accordance with Bank procurement guidelines and procedures("Guidelines for Procurement under World Bank Loans and IDA Credits" of May 1992, as amended, and"Guidelines for the Use of Consultants by World Bank Borrowers and by World Bank as ExecutingAgency" of August 1981). A Project Preparation Facility in the amoupt of US$1.45 million had beengranted by the Bank and was used to finance part of the preparation services. The PPF, charges andaccrued interest will be repaid from the loan after its effectiveness.
4. PROJ.ECT IMPLEMENTATION
A. IMPLEMENTATION AGENCIES
4.1 Implementation of the project will follow standard IUDP procedures being applied under3 ongoing IUIDP Bank projects and one approved in FY94, although increasing attention is given toenvironmental and resettlement aspects. Existing organizations at the municipal level will be responsiblefor implementation of the project as mentioned below and schematized in Annex 6:
(a) Urban Roads and Traffic Management. The Roads and Bridges Section of theMunicipal Public Works Agency (DPU 11) is responsible for the construction, maintenance andsupervision of local roads and bridges. Provincial and national roads are the responsibility of theDirectorate of Urban Roads (BINKOT) in D.G. Bina Marga and its provincial offices (DPU 1).IEngineering consulting support is being provided under the project to assist the agencies.
(h) Water Supply. The PDAMs are responsible for implementing their respective programs.Consultants will be appointed by each PDAM under general guidance from Cipta Karya to help themimplement the programs. A project implementation unit will be set up in each PDAM.
(c) Solid Waste Management. Dinas Kebersihan (Cleansing Agency) in the municipalitieswill be responsible for solid waste management activities. It will be supported by technical assistanceto be managed under the PMU.
(d) Human Waste Disposal/Drainage. Dinas PU TkIl will be responsible for on-sitesanitation system activities and drainage improvements at the local government level. Implementationof pilot off-site systems will be the responsibility of DGCK.
(e) KIP/Infrastructure for Low-cost Housing. The municipal housing agency (DinasPerumahan) in each city will be responsible for the implementation of the KIP components. Consultantteams, providing assistance on the technical, financial, economic, institutional and environmental aspects,will be located in the Dinas Perumahan, but will be responsible to the Directorate of Housing, DGCK.
(t) MIP. The market agency in each city (Dinas Pengelola Pasar) prepares the plans and theDPU will be responsible for implementation of the MIP component of the project.
4.2 Provincial Agencies. Provincial governments of Kalimantan will have directimplementation responsibility for subprojects financed from INPRES I and APBD I funds, that are arelatively small share of the project funding. The provincial planning agencies (BAPPEDA I) assist localgovernments in the normal preparation of funding requests for approval by the central government.
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4.3 In order to ensure the availability of full-time staff in the implementation units, themunicipal governments will issue special Letters of Assignment to release staff from their regular duties.An IMG-approved draft of the official Instruction (SK) on Implementation Arrangements and a final draftof the Instructions from the city mayors on the establishment of the implementation units were availablefor negotiations. Staff for the units have been selected and will be trained prior to loan effectiveness.
4.4 In order to improve project implementation, the GOI will prepare and agree with the Bankon a training program within 6 months of loan effectiveness, aimed at development of local institutionalcapability more broadly (identifying who will provide each of the courses, the duration of each course,and the prior academic requirements of trainee applicants; and a detailed statement of how the localgovernments can access the training program for their staft).
4.5 Project Implementation Agreements (PIA). Project Implementation Agreements (PIA)have been drawn up between GOI. the five Kotamadyas, and their PDAMs confirming essentialunderstandings and commitments based upon the medium-term expenditure programs (PJM), financingplans, Revenue Improvement Action Plans (RIAP), Local Institutional Development Action Plans(LIDAP), and sound criteria for land acquisition and resettlement. Through the PlAs, Kotamadyas andtheir PDAMs commit themselves to comprehensive sectoral expenditure programs (including O&Mbudgets), specific revenue targets and measures to strengthen the institutional capabilities of urbanmanagements as included in this project. The investment and sector plans can be amended annually toreflect changing conditions during project implementation, as is the IUDP approach. Amendmentproposals, if necessary, should include an environmental assessment, a resettlement plan, and amanagement and monitoring plan. Draft PlAs acceptable to the Bank between GOI and the KotamadyasBanjarmasin, Balikpapan, Pontianak, Samarinda and Palangkaraya and their PDAMs were available atnegotiations and will be finalized by loan effectiveness.
B. PROJECT COORDINATION AND MONITORING
4.6 Central Agencies. Coordination and guidance for the project will be provided by theUrban Development Coordination Team (TKPP, composed of director-general level officials), with theassistance of the IUDP Implementation Management Group (IMG, composed of directorate-chief levelofficials). BAPPENAS chairs TKPP and IMG, and is responsible for daily management of the IUDPImplementation Support Unit. Overall responsibility for technical supervision and management of theproposed project in the central government will be assumed by DGCK and DGBM of MPW. DGCK andDGBM will also be responsible for direct implementation of infrastructure programs classified as centralresponsibility, assisted by the DGCK-based Central Project Management Office (CPMO) and CentralProject Finance Office (CPFO). Established under earlier urban projects financed by the Bank and otherdonors, the CPMO would be responsible for monitoring all program and subproject implementation. TheCPFO, similarly, was established under past projects and would be responsible for oversight, monitoring,consolidation, and preparation of all project accounts. It would also be responsible for preparing annualproject accounts for audits (see para 4.16) with the help of core consultants/staff resident in each of thefive cities assisting with technical auditing of the projects physical works.
4.7 Municipal Governments. Each municipal government will have primary responsibilityfor project coordination and monitoring at the local level. A Steering Committee (SC) and a TechnicalTeam (Tim Teknis) established at the local level planning board (BAPPEDA 11), functioning as a ProjectMonitoring Office (PMO), will provide overall guidance. A Project Management Unit (PMU) will beestablished under the Dinas PU by the city mayor to coordinate the activities of the units implementingthe various sector programs. Local Project Finance Offices (PFO) will be established under the
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jurisdiction of the finance section of each Mayor Secretary's Department for financial monitoring of theproject. The project will provide technical assistance to the municipal IUDP teams.
C. IMPLEMENTATION SCHEDULE
4.8 Project implementation is expected to commence in GOI's FY1995/96 and be completedover a five-year period ending FY2000/2001. The technical teams at the local level which will beresponsible tor implementation were involved during the preparation phase. The first year program willconcentrate on a) implementing relatively standard components that require little technical preparation,such as road overlays, KIP/MIPs, pipe and meter installations for water supply components; and b) inpreparing other components that require more detailed technical preparation, resettlement and landacquisition, and terms of reference for more detailed studies and follow up assistance. Theimplementation schedule is included in Annex 8.
4.9 In order to facilitate project implementation to start early a high priority technicalassistance and engineering services package has been identified for the required first year activities.Terms of reference, a shortlist of consultants and a letter of invitation were approved by the Bank andare in project files. A tirm had been preselected by negotiations; the selected firm is to start work beforeloan effectiveness with financing from another Bank loan.
D. PROCUREMENT AND DISBURSEMENTS
4.10 Procurement of civil works, goods and consultant services will follow Bank guidelines.Large civil works contracts costing US$3 million or more and goods contracts costing US$200,000 ormore will be procured following International Competitive Bidding (ICB) procedures, using the Bank'sstandard bidding documents (SBD). A General Procurement Notice would be issued in advance toencourage participation of eligible parties. Smaller civil works contracts, valued at less than US$3million up to an aggregate amount of US$113 million and goods contracts valued at less than US$200,000up to an aggregate amount of US$6 million would be procured under Local Competitive Bidding (LCB)procedures acceptable to the Bank (Table 4.1). Goods contracts for less than US$20,000 each up to anaggregate total of US$2 million, may be procured through prudent international and/or local shoppingunder procedures satisfactory to the Bank. All consulting services under the Bank loan would beprocured in accordance with the Bank guidelines for the use of consultants (para. 3.20). Domesticpreference would be provided during bid evaluation at a rate of 15 percent of the CIF price or theapplicable customs duty, whichever is lower for local manufacturers participating in the ICB procurementof goods.
4.11 Procurement Review. Civil works contracts exceeding US$I million equivalent in value,goods contracts exceeding US$200,000 equivalent in value, and consultant contracts with an estimatedvalue of US$100,000 or more for engagement of firms (US$50,000 or more tor the engagement ofindividuals) would be subject to prior review by the Bank. The balance of contracts for goods and civilworks, including those reimbursed under Statement of Expenditures (SOE), will be subject to selectivepost-review by the Bank. Contractors tor civil works exceeding US$1 million in value would be pre-qualified in accordance with procedures satisfactory to the Bank. Terms of reference for all consultantservices, including detailed engineering design and supervision, studies and other technical assistance,would also be subject to prior Bank review. The use of standardized bidding documents by the borrowerwill facilitate Bank review.
(9.0) (9.0)Technical Assistanceand Training 11.8 11.8
(10.6) (10.6)
Land, taxes and duties 21.0 21.0Incremental O&M and Administration 26.1 26.1
Total 47.3 119.0 24.2 59.1 249.6(35.0) (78.7) (20.6) - (134.3)
(PPF) (1.7)
/a Figures in parentheses are the respective amounts financed by the Bank./b Includes local and international shopping, and selection of consultants following Bank guidelines for
the use of consultants./c Not Bank financed.
4.12 Procurement Packaging. Where technically feasible and administratively practical,subprojects have been/will be packaged together for tendering. Procurement of physical components willbe kept separate for each agency (central and local governments, PDAMs) to avoid administrative delaysand complex payment procedures. Similarly, procurement will be kept separate for each sector (roads,drainage, etc.) as each contract will be administered by a different agency. However, consultant serviceswill be combined wherever feasible, e.g., support packages for studies, institutional strengthening for allcities, etc. Table 4.2 summarizes the number of ICB and LCB contracts expected by sector.
4.13 Disbursements. Loan disbursements would be made at the following rates for the variousexpenditure categories: (a) civil works, 60 percent; (b) 100 percent of CIF costs of directly importedgoods (ICB), and 100 percent of ex-factory costs, for goods supplied by local manufacturers, and65 percent of the costs of other locally procured goods; (c) subprojects under SLAs to local governmentsand water enterprises - 91 percent; and (d) consultancy services and training - 91 percent of the costs ofcontracts managed by the municipalities and PDAMs, and 80 percent of the costs of contracts managedby central government agencies except for the contracts signed before June 1, 1995 for which 91 percentapplies (Table 4.3). Domestic funding will be used for procurement of vehicles. No taxes will be paid
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Table 4.2: EXPECTED NUMBER OF ICB AND LCB PACKAGES BY SECTOR
/a 91 % also applies for services contracted by the Central government prior to June 1, 1995.
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4.14 To facilitate loan disbursements, a Special Account will be opened by the Ministry ofFinance in Bank Indonesia for withdrawals against all eligible foreign and local expenditures. Theauthorized amount of the Special Account is US$5 million. This account would be maintained in USdollars, with an initial deposit of US$3.5 million. When disbursement will have reached US$7 million,the Special Account deposit can be increased to US$5 million. Withdrawal applications would be fullydocumented, except for civil works contracts below US$1 million equivalent and equipment contractsbelow US$200,000 equivalent, and consulting firms valued below US$100,000 equivalent and individualconsultants valued below US$50,000 equivalent, and all the training, for which the use of Statement ofExpenditures (SOEs) would be required. Replenishment of the Special Account would be made on amonthly basis or when 20 percent of the initial deposit has been used, whichever comes first. Detailedsupporting documentation for SOEs would be retained by DG TUA and the implementing agencies andmade available to the Bank for review on request. Assurances were provided at negotiations thatpayments to local contractors including contracts under SLAs, would be made from the KPKN Treasuryoffices in the respective provincial capitals (as is being done normally with SPABP payments).
4.15 The proposed disbursement period of five years is somewhat less than the disbursementprofile for IUIDP projects in Indonesia. However, as this project has been prepared taking into accountthe start up problems encountered in the earlier projects, and thus steps taken to (a) mobilize early theconsulting services, (b) use up to US$400,000 from the Jakarta Urban Development Project II for startingsome project activities prior to loan effectiveness; and (c) assure availability of counterpart funds for thefirst year, it is considered achievable. The project completion and loan closing dates are December 31,2000 and June 30, 2001 respectively. The estimated schedule of disbursements and the relateddisbursement profile are shown in Annex 10.
E. PROJECT ACCOUNTS AND AUDITS
4.16 The finance offices of each implementing agency are responsible for project accountingand audit arrangements. At the local level the Finance Offices (FOs) in each city will maintain accountsfor project related expenditures financed by all sources of funds for all project components, includingthose relating to the PDAMs. Each PDAM will maintain a separate account for the project. At thenational level, the Central Project Finance Office (CPFO) in Cipta Karya will prepare project accountsof all components implemented directly by the central agencies. CPFO will also be responsible forconsolidating quarterly project accounts for the entire project and submitting them annually for audit bythe government auditors, Badan Pengawasan Keuangan dan Pembangunan (BPKP). CPFO will alsocoordinate separate audits of the SOEs with the Directorate General for Budget, Bank Indonesia, and thecentral office of the State Audit Board.
4.17 Assurances were provided during negotiations that the consolidated project accounts,including the Special Account and SOEs, as well as the overall accounts of the PDAMs, will be auditedannually by independent auditors in a manner satisfactory to the Bank and that the audited projectaccounts would be submitted to the Bank no later than six months after the end of each fiscal year,commencing FY95/96. Audits of PDAMs overall financial statements should be retained at each PDAMfor review by Bank missions. In addition to financial audits, assurances were obtained at negotiationsthat GOI will also appoint the Inspectorate General of the Ministry of Public Works and the provinciallevel Inspectorates as auditors for technical audit of project implementation including, inter alia, civilwork contracts, procurement of goods and training programs, in a manner satisfactory to the Bank.Domestic sources will fund the audits. The first technical audit will be discussed with the Bank no laterthan I year after loan effectiveness; and at regular I year intervals thereafter. Terms of reference forboth financial and technical audits will be finalized by GOI in consultation with the Bank.
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F. PROJECT REPORTING, MONITORING AND BANK SUPERVISION
4. 18 DGCK, with assistance from its CPMO and CPFO, will prepare and submit to the Bankquarterly progress reports (QPR) on the basis of inputs from the five cities and implementing agenciesof the central government, with an overall summary and covering the progress on: (a) physical aspectsof each component; (b) institutional development (LIDAP) and revenue improvement (RIAP) actions; (c)consulting services; (d) compliance with loan agreement covenants; (e) administration and finance,including project cost, commitment and disbursement schedule; and (f) a list of actions to be taken bythe various parties. The progress reports substance including performance indicators, and the format willbe discussed at the workshop for the project launch scheduled for April 1995 (as recorded in the minutesof negotiations). QPRs would be submitted within 45 days from the end of each quarter, starting withthe quarter ending December 31, 1995. On completion of the KUDP, the DGCK, assisted by the fivecities, would prepare a Implementation Completion Report within 6 months after the loan closing date,for review by GOI and the Bank.
4.19 The project would require some 30 staff weeks of Bank supervision each year during thefirst two years and 20-25 staff weeks annually in the subsequent years of the project (Annex 11).Supervision missions would include engineering, institutional, financial and environmental expertise. Themissions will review the yearly plans and budget proposals not later than November 30 each project year.After completion of two project years, not later than June 30, 1998, a mid-term review would take place.The proposed arrangements and schedule for project supervision were agreed with GOI at negotiations.
G. OPERATIONS AND MAINTENANCE
4.20 Expenditure programs for the municipalities and PDAMs include O&M budgets in everysubsector in accordance with IUIDP guidelines. MHA Ministerial Decree No. 5 of 1990 promulgatedPerformance-oriented Operations and Maintenance Management Systems (POMMS) and revised localbudgeting procedures to encourage O&M. Current O&M expenditures and incremental O&Mexpenditures (to reach necessary levels and expand coverage) are clearly separated. Adequate budgetingfor current and incremental O&M is an important objective of KUDP; domestic sources will fully fundO&M to ensure sustainability of the increased level under the project. Advisory and training assistancewould be provided under the project to improve maintenance practices. During negotiations the Borroweragreed to review annually with the Bank the operation and maintenance expenditures of the previous yearas well as the budget for the following year.
H. LAND ACQUISITION, RESETTLEMENT AND COMPENSATION
4.21 The project minimizes resettlement through design alternatives that reduce land acquisitionneeds. KIP programs improve on-site poor neighborhoods through community participation inidentification, planning and implementation of upgrading community infrastructure. Most other civilworks are of a rehabilitation/upgrading nature that do not require land acquisition. Pipes for expansionof the water transmission and distribution systems will be laid in existing rights of way of roads,including sidewalks where applicable. Where subprojects require new land, the extent is generally smalland in most instances has been acquired during the long project preparation process. Nevertheless, asof September 30, 1994, some 39 hectares still had to be acquired under the project (20 of them aregovernment-owned vacant land to be acquired by an agency). Only 57 families would be affected and39 families would be displaced in all 5 cities. Two settlement action plans have been prepared and foundsatisfactory by the Bank. Details are in Annex 12.
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4.22 Presidential Decree 55/93 on land acquisition for public facilities will be applied to allresettlement financed by Bank-assisted components (para. 1. 15). Unlike cities in Java, where land andfinancial resource constraints inhibit resettlement, site-specific factors that favor successful resettlementin KUDP include the fact that land is not in short supply, making it possible both to adjust civil worksto reduce resettlement needs, and to find alternative housing sites that do not pose significant transportcosts on resettled families. The cities already have large affordable housing programs operating underother urban investment programs that have been used for successful resettlement; Samarinda has receivedthe Aga Khan award for a central business district redevelopment. The cities have sufficient funds athand to pay adequate compensation. Managing resettlement for the proposed project will only involveintroducing some refinements to familiar procedures.
4.23 Project Resettlement and Rehabilitation Action Plans. The municipal government ofeach city is responsible for managing land acquisition and resettlement, with technical support providedby DG Cipta Karya or DG Bina Marga. Only 2 project components displace more than 10 families. Oneis the ring-road in Banjarmasin (19 families displaced and 37 families affected; a number of families weremoved prior to the inclusion of the road in the proposed project and were compensated adequately). Theother project component displacing more than 10 families--20 families--is the wastewater/interceptoraeration pond in Samarinda. Resettlement Action Plans have been prepared and found satisfactory; theyare in the project file. Sites have been individually surveyed. The core of each resettlement plan consistsof providing resettlers with the option to accept cash compensation at replacement value, or serviced plotsor serviced plots with a core house in larger resettlement and affordable housing programs beingdeveloped by each city. None of the resettlement sites is more than 7 kilometers (most are closer) fromcurrent sites, and the project will provide moving assistance to families that elect to move. Affordabletransportation to work is already available at new sites. Where only a few families are affected ordisplaced, the local governments are applying the same compensation criteria, as expressed in the ProjectImplementation Agreements, although detailed plans will not be prepared. For subprojects that need landacquisition and resettlement, the related costs are included in the project budget keyed to civil workstimetable for each sub-project. The Government has agreed to resettle affected people according to theplans agreed with the Bank. A resettlement specialist will be included in the project's technical assistanceprogram under TORs agreed with the Bank, to assist municipal governments with implementation,preparation of monitoring reports and development of improved guidelines for resettlement under futureprograms.
L. ENVIRONMENTAI, IMPACTS
4.24 The project will have a positive impact on the human and natural environment in all fivecities through improvements in waste disposal, drainage and flood control. Most negative impacts willbe minor, corridor impacts associated with construction, rehabilitation or upgrading of urban roads,drainage systems and flood control. However, the project includes a small number of sub-projects,including new solid waste disposal sites in all five cities and possibly sewerage treatment plants in 2cities, that could have significant though localized negative impacts. The project was labelled "CategoryA" early on. The Environmental Assessment Summary was distributed to the Executive Directors onMay 11, 1994.
4.25 Under GOI regulations (PP 29/1986) Preliminary Environmental Assessments (PILs) wereundertaken for each of five sectors (water supply, solid waste, drainage, roads and sanitation) for eachof the five cities in 1992. Based on these assessments, environmental management and monitoring plans(RKL/RPL) were prepared. The central commission of the Ministry of Public Works approved the PILs
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in 1993, and the relevant commissions approved the environmental impact analyses (ANDAL) preparedfor the solid waste sector, and RKLs and RPLs, in January 1994.
4.26 The major areas for attention are: a) the proposed Banjarmasin ring road, whose alignmenttraverses a wetland area. The engineering design will have to minimize any disruption to the wetlandsystem; the Bank will want to review the design before the start of procurement. As the road wouldlikely induce settlement within the wetland, the city land use plan to he prepared under the project willinclude measures to protect the wetland, in particular its function in controlling tlooding; b) supervisionwill be required to oversee transport and disposal of material dredged from drains and canals duringupgrading; c) supervision will be required to minimise traffic disruption during construction of road sub-projects; d) design and post-construction monitoring will be required for solid waste disposal sites andfor the eventual sewerage treatment plants/waste water systems. Criteria for mitigation of environmentalimpacts that will be provided as guidelines for contractors are detailed in Annex 13.
4.27 The review of RKL/RPLs identified the need tor improved inter-agency coordination tomanage and minimise impacts during construction. In all five cities institutional capacity forenvironmental management requires strengthening with regard to staff numbers, skills and experience.Within about the next five years, other donor-funded projects will provide laboratory facilities and trainedtechnical staff at the provincial-level for air and water quality monitoring; these will he readily availableto the city administrations. Thus, TA under KUDP will develop and deliver on-the-job training programsfor Dinas Cipta Karya and Dinas Bina Marga staff, for improving each city's capacity to effectively directenvironmental planning, assessment and management processes. In addition, funds will also be used toprepare and deliver public awareness campaigns on proper methods of domestic waste disposal, tocomplement the work being undertaken to improve solid waste collection and urban drainage.
4.28 If any new major component were to be added later to the project, environmentalscreening and/or assessment and a resettlement plan, as may be appropriate, would be required prior toBank approval for funding.
5. FINANCIAI. ASPECTS
A. LoCAL GOVFRNMENTS
5.1 Most local governments will continue to receive substantial grant funding in thetoreseeable future. Non-grant revenue forecasts under the RIAP process project a somewhat higheraverage real growth than in the recent past for all five cities; the projections are reasonable and withinthe local governments' power to achieve. Revenues are expected to double by the year 2000. (Annex14).
5.2 RIAP/LIDAP Process. Although annual growth in local revenues has generally beensteady, studies undertaken during preparation of the Revenue Improvement Action Programs (RIAPs)indicate that current levels of revenue from major sources are considerably below their potentials.Deficiencies are often found in local administrations: a significant number of potential tax payers gounregistered, taxes are under-assessed, and revenues, under-collected. The project seeks to address thesedeficiencies. RIAPs and LIDAPs introduced during the project preparation phase, and to be refinedduring project implementation, seek to identify steps to achieve improvements in the planning andadministration of local taxes and service charges. Such steps typically include collection of data on therevenue bases including proper identification of tax objects and subjects, tax assessment approaches,review of tariffs, and establishment of annual revenue targets for progressively narrowing of the gap
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between performance and identified potentials. The local governments have committed themselves toimplementing the RIAPs/LIDAPs with technical assistance and necessary equipment provided under theproject.
5.3 Cost Recovery. The cities charge for solid waste disposal and sanitation (including on-sitesanitation and sludge removal). The level of O&M cost recovery varies among cities, with Samarinda,Pontianak and Balikpapan covering up to 80-100 percent. Because of low rates and low collectionefficiencies, the 1993 revenue from solid waste charges in Banjarmasin and Palangkaraya covered only40-70 percent of O&M costs, with no contribution being made towards capital costs. All five localgovernments have agreed to increase periodically solid waste tariffs to at least cover O&M. They havealso agreed to implement sanitation tariff increases resulting from the RIAPs.
5.4 Borrowing. Estimates of maximum borrowing capacity for each local government havebeen prepared by making revenue and expenditure projections for the program period and a number ofsubsequent years sufficient to establish that the savings from locally generated revenues, after deductingroutine expenditures, can service debt. The total borrowing capacities are small. All local governmentshave nevertheless made commitments to borrow small amounts in consultation with central and provinciaigovernments. A total of about US$13 million out of the Loan is expected to become subsidiary loans tothe local governments; the local government proposals are generally satisfactory. Draft sub-loanagreements for the local governments were reviewed during negotiations and the specific amounts wereconfirmed. Local governments eligible for borrowing under this project agreed to maintain minimumdebt service coverage ratios of 1.5, based on locally generated revenues.
B. WATER ENTERPRISES
5.5 Financial Management. Given that PDAMs' accounting, reporting, billing, accountsreceivable, and controls are generally weak, partly due to shortages of skilled personnel and relaxedrequirement by the authorities, technical assistance and training will be provided for: (a) improving thefinancial reporting systems to suit a timely annual audit cycle; (b) setting up accounting and reporting ofaccounts receivable to monitor aging debts and prepare action plans for collection; and (c) organizing themeter reading and billing functions with effective controls.
5.6 Tariffs. The tariff structure is progressive with quantity consumed and is higher for non-domestic users. Tariff increases ranging from 33 percent to 60 percent were implemented in 1993 forall except PDAM Banjarmasin and Palangkaraya. Palangkaraya's new rate became effective January 1994and Banjarmasin's, in July 1994. Tariffs will be increased every other year in order to ensure that atleast cost escalations due to intlation are covered and the foreseen capital self generation is achieved. Incurrent prices, average tariff per m3 are expected to increase from 1994 to 1999 as follows: Rp 649 to1030 in Pontianak, Rp 540 to 983 in Palangkaraya, Rp 628 to 1212 in Banjarmasin, Rp 757 to 1251 inBalikpapan, Rp 729 to 1056 in Samarinda (Annex 15). Tariff increases will be implemented every twoyears starting January 1, 1996 to enable PDAMs to fully cover O&M after FY1995 and fully cover O&Mand depreciation by FY1999, while incorporating efficiency improvements that should reduce costs.
5.7 Financial Projections. The financing plans maximize self financing first, from revenues;then include borrowing as possible, and residually, equity contributions. Only Samarinda does not counton new equity. Key financial indicators are shown in Annex 14. They are based on a list of assumptionsfor each PDAM, the most important of which include: (a) number of existing and additional connections;(b) minimal capacity utilization to be attained; (c) reduced levels of non-revenue water; (d) level of newinvestments and subloans; (e) agreed periodic tariff increases; and (t) PDAMs will be allowed to retain
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profits and required to use them towards financing their programs during the project period, as needed.Detailed financial projections are in project files; they indicate that all PDAMs will cover the cost of theirO&M by 1995 and will achieve a three year average debt service ratio of at least 1.5 by the end of thegrace period. Any PDAM investment additional to the PJM exceeding Rp. 2 billion would require priorBank consultation. Draft sub-loan agreements for the PDAMs were reviewed during negotiations;specific amounts were confirmed. PDAMs eligible for borrowing under this project agreed to maintainminimum debt service coverage ratios of 1.5, based on locally generated revenues. More generally, toenhance the self-financing capacity of PDAMs, the GOI agreed to take measures such as instructingPDAMs by September 1995 to deduct depreciation from their estimated profits available for distributionto local government (as recorded in minutes of negotiations).
6. PROJECT JUSTIFICATION AND RISKS
A. ECONOMIC JUSTIFICATION
6.1 Each of the investments planned for funding under the project have been subject toeconomic analysis by consultants. As the cities had relatively low service levels in 1993, and theirpopulations are expected to grow by almost 500,000 persons by the year 2000, the investments are highlyjustified. Below are some of the main features; some details are provided in Annex 15, and hill reportsare on file.
6.2 Water Supply. The proposed project component includes investments in water treatmentplants and distribution networks, to increase and balance the systems' capacities; investments inrehabilitation including leakage control; and it emphasizes O&M. In selecting the individual schemes,least cost investment schemes were determined by comparing alternative solutions in terms of their long-term economic and operational performance. Specifically, larger conventional custom designed concretewater treatment plants were found to be superior to smaller steel package plants, and a network analysishelped define optimal distribution system expansions. Also, water resource studies will be undertakenin preparation for the next capacity expansions.
6.3 Some half the populations depend on unreliable and poor quality water sources, inparticular during dry seasons when salinity levels are high. Demand surveys and analyses have been donein every city. The project is expected to provide piped water through house connections to 600,000persons in the five cities. Credit schemes will be available for low income households that otherwisewould not be able to afford the connection charge. Including users of public taps, the PDAM coveragewould increase from 30-40 to 60 percent average of the population in the 5 cities. The main benefits areincreased availability of piped water at reduced costs; water tariffs from house connections are generallyless than 10 percent those from vendors, so that the proposed tariff increases do not compromiseaffordability. As overall benefits from the better water supply, including reduced morbidity, are noteasily quantifiable no economic rates of return have been calculated. However, analyses have estimatedthat the willingness to pay for the water exceeds the costs and tariffs. Cost recovery is an indication ofminimum economic returns; the PDAMs are expected to fully recover costs including financial costs anddepreciation, by the end of the project period.
6.4 Drainage and Flood Control. The cities are low-lying and subject to tidal flooding alongtheir water courses. While flooding may not be eliminated from some areas, the frequency and durationcan be mitigated. Existing deficiencies in drainage and flood control are mainly attributable to inadequatemaintenance; capacity can be increased by cleaning drains and canals currently clogged with solid waste,sediment, and vegetation. The lowest cost solution among various technical solutions usually corresponds
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to undertaking regular maintenance. Nevertheless, rehabilitation and realignment have also beenidentified as necessary for some canals/drains; and flood control studies are needed for a few largerproblem areas. The proposed investments will benefit a total of some 940 ha, between 3 and 15 percentof the city areas, by reducing: (a) flood-related physical damage, building damage and break-up of roads;(b) traffic disruptions caused by flooding and damaged roads; (c) health problems--especially of poorpeople living in low-lying and hence flood-prone areas. The benefits are not easily quantifiable and noERR has been calculated. However, the cost has been verified to be less than that of relocating residents,and a cost-benefit ratio has been calculated for each component by dividing expected increases in landvalues (which have been used as a proxy for economic benefits) by investment and O&M costs of theproposed drainage and flood control schemes. For the component to be economically justified, land valueincreases of 0.3-29.5 percent for the regularly flooded areas would be required; the increases are feasiblein light of prices in similar, but non-flooded, areas. Studies for wetland protection will be undertaken,as necessary, as part of land development plans.
6.5 Sanitation. In general, regularly desludged septic tanks represent an adequate sanitationsolution in low population density areas. However, the high water tables in the project cities makeconventional septic tanks to be technically inefficient; further, desludging is rarely done because of highcost and unawareness of the benefits. Alternative technologies will be tested, and the most appropriatewill be adopted under the project. A credit scheme will be available to allow low-income households toinstall on-site sanitation facilities. Investments in sewerage systems are justified, in life cycle terms, inareas with higher population densities--such as Banjarmasin's Banjar Barat subdistrict with more than 250persons per ha. In all, it is expected that an additional 25 percent of the populations will have improvedsanitation. This project component generates benefits in terms of health and avoided ground watercontamination which are not easily quantifiable; thus, no ERR has been calculated. However, costrecovery is expected over time for the on-site installations and partial cost recovery from the seweragesystems (the benefits from reduced negative externalities may not be tapped for cost-recovery).
6.6 Solid Waste Management. Solid waste is being generated at a rate of 3 liters per capitaper day--between 1,160 m3 and 1,500 m3 per day in the four larger cities. Only between 50 and 60percent is being collected. The proposed investments in solid waste management will increase solid wastecollection levels to some 80 percent, benefitting the majority of the residents. Environmental degradationcaused by burning or dumping of uncollected solid waste into rivers and drains would be reduced throughenvironmentally safe collection services and operation of new and improved landfill sites. The costrecovery for the mostly publicly provided garbage removal will gradually increase under the projectaccording to the RIAPs. It is also expected that the project will attract private sector participation, forimproved service and cost recovery. However, lesser cost recovery will be possible at landfills.
6.7 Kampung/Market Improvement Programs. The KIP component provides public toilets,solid waste collection, foot paths and drainage. The program is expected to be able to upgrade all thelow income kampungs and benefit some 500,000 persons. At about Rp 50 billion or 10 percent of totalproject costs, investments under this component are relatively low; capital expenditures per beneficiary(Rp. 100,000) are low and far exceeded by benefits. KIPs tend to substantially improve the livingconditions of the residents and mobilize community resources. Beneficiary households and communitieswill be involved in the identification, planning, preparation and implementation of the works, as well asthe operation and maintenance; some training will be provided for self-help works but larger works willbe contracted out. Some infrastructure, mainly roads, will also be provided under the project in 3 poorareas totalling 64 ha where urban renewal is planned with private sector participation and funding, andfor 6 new low-income housing developments totalling some 100 ha, mainly to be built by Perumnas. Thehouses would have 18 m2 on 60 m2 to 200 m2 lots, and cost $2000 and upwards; credit will be availablefrom provincial banks for mortgages. The houses are in high demand because they are one of the few
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ways of acquiring land, and their low initial cost allows buyers to upgrade them progressively with theirown work. And, the infrastructure of 24 markets with an area of 134 ha will be improved, includingimprovements to superstructures; the improvements are very much needed and their costs are more thanrecovered from municipal fees on the vendors, who participate in deciding the improvements.
6.8 Roads. The five cities total some 1000 km of roads, and a majority of the 500,000 motorvehicles registered in the four provinces are located in these cities. Given high motorized traffic growth,down-town roads tend to carry traffic volumes exceeding design capacity. The road agencies willundertake improved road maintenance with budget increases from domestic sources, to ensure theirsustainability. Maintenance strategies have been developed by the central government's road agency andare followed by the local agencies; in accordance with the strategy, roads should be resurfaced every 5or 6 years. Returns on good maintenance are high, typically over 30 percent. Under the project some125 km of roads will receive periodic overlay -- 77 km of them in Pontianak but much shorter lengthsin the other cities, that have preferred to include road upgrading under the project. In all, some 280 kmof roads, mainly "local" roads, will be improved/upgraded through widening, new drains, sidewalks, etc.Each of the planned improvements has passed the test of an economic analysis that required a minimumexpected rate of return of 10 percent; average returns are much higher. In all, about one third of theurban road length will be improved under the project. Furthermore, the project includes 30 km of newroad construction (dualling the airport road in Pontianak, a new alternative airport road in Balikpapan;a new ring road in Banjarmasin). Benefits of works include savings in vehicle operating costs due toreduced congestion and in some cases, reduced travel distances. Savings in travel times are alsoestimated. All rates of return exceed 10 percent without travel time savings. Finally, traffic managementstudies will be undertaken in some of the cities with a view of implementing their recommendations underthe project.
B. POVERTY IMPACTS
6.9 The project is expected to substantially alleviate poverty as many components are targetedat improving the quality of life and environment in the poorer kampungs. The population with accessto piped water could about double while reducing the cost for many consumers. An instalment paymentplan would be provided for house connections for consumers who would otherwise not aftfrd them.Monthly water bills would be less than 5 percent of the expenditures of low-income (assumed Rp150,000) households. The drainage and flood control component would reduce the frequency andduration of the floods in the low lying areas where many of the urban poor have settled. It would reduceproperty damage and health impacts associated with stagnant polluted water in the neighborhoods, andreduce access disruptions. The human and solid waste disposal components will reduce morbidity (ormedical expenditures) by expanding the coverage and using better ways for disposal. In particular, thepilot studies on new sanitation technologies and public education campaigns should lead to greatlyimproved services and reduced morbidity and environmental contamination. Care will be taken to allowcontinued recycling by scavengers at the new landfills. The traffic management programs, that wouldimprove conditions for non-motorized vehicles and pedestrians, would also benefit the poor. The KIPand MIP programs to improve micro-infrastructure are targeted on densely populated poor neighborhoods,they would benefit some 500,000 persons, or 25 percent of the urban populations--it is expected that bythe end of the project all poor kampungs will have been improved, in line with a renewed anti-povertycampaign by the Government (the INPRES Desa Tertinggal). Community participation at all stages andtraining are added benefits of the project. Likewise, downtown urban renewals will benefit the poor andrevitalize business; one of these areas include a riverside community that had an outbreak of cholera afew years ago, in Samarinda. The project avoids resettling people by upgrading their neighborhoods.But at the same time, the new low-income housing developments allow an affordable alternative to those
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who want to move--although demand tends to exceed supply, and non-poor are also interested in theschemes.
C. ENVIRONMENTAL IMPROVEMENTS
6.10 The project will have a positive impact on the environment in the five cities throughimprovements to solid and human waste disposal, drainage and flood control, and supporting the kampungimprovement program. Environmental management and mitigation measures have been built into thedesign and cost of subprojects, and institutional arrangements have been made for monitoring impacts onthe environment.
6.11 All the subprojects are within the existing city boundaries. A majority of the subprojectswill be improvements on site: (a) for roads, all the periodic maintenance works, the upgrading andwidening on existing alignments, the improvement of side drains will have a beneficiary environmentalimpact; fuel consumption per kilometer by motorized vehicles will be reduced, reducing air pollution,through improved road capacities, surfaces and traffic management, where applicable; (b) for drainage,improved maintenance of drains will reduce flooding and disposal methods for the sludge are to beimproved; the justification of small scale hydraulic gates for flushing in Pontianak and Banjarmasin ona pilot basis will be reviewed; and flood control studies will be undertaken in 4 of the 5 cities.
6. 12 Unsanitary human waste disposal will be improved with a beneficial environmental impact.While vertical septic tanks had been installed on a pilot basis and proposed as a new on-site technicalsolution for these cities with high water tables, from new impact data the appraisal concluded that theywould not achieve the intended objectives despite their high cost. The project thus includes thedevelopment and monitoring of other on-site prototype solutions during its first year, for implementationof the successful ones on a wider scale during subsequent years. The monitoring is to include healthsurveys, chemical contents (TKN, SS, TOC, DO, etc), social acceptability, cost and ease of operationsand maintenance, and environmental impacts. Subsequently, training and education programs will ensurethat women, in particular, will understand the benefits of the new systems and will know how to use andmaintain them properly; also, credit schemes will be available to ensure the affordability of the systems.Overall these improvements will reduce ground water contamination. The project also includes studiesfor small scale sewerage/waste water schemes and their implementation in dense business districts whereon-site solutions are technically unviable, and their monitoring for subsequent improvement or replication.
6.13 The landfill operations would satisfy the Bank's environmental requirements--they will beoperated on a sanitary basis, will include a composting area and continue to support recycling by privateoperators. The existing inadequate landfills will be closed and thereby soil and water contamination willbe reduced. Increased availability of solid waste collection trucks at affordable fees will reduce theamount of waste that currently goes uncollected--burned or dumped in drains or empty lots--from some50 percent to some 20 percent average (Annex 16).
6.14 The three new road construction subprojects were added at appraisal. In Pontianak, theairport road will be dualled on an existing, fully cleared right of way, and the detailed design will includeappropriate cross and side drains, to be approved by the Bank for final subproject approval. The newairport access road in Balikpapan, that will also serve as a city ring road, is to be built by upgrading anexisting road on its right of way; appropriate drainage will be included in the design and anenvironmental review will be made for Bank approval. The new ring road in Banjarmasin, highlyjustified to reroute polluting heavy traffic from densely populated downtown areas, has been proceeding
- 30 -
gradually with the appropriations the municipality could secure from yearly budgets and will be completedunder the project, pending final engineering including an environmental analysis.
6.15 For development of the cities beyond the project period, the project includes technicalassistance to help prepare land use development plans taking into account environmental considerations.Financing for the studies, however, is not included in the project cost estimates. Studies on raw watersources will help select the best future sources.
D. RISKS
6.16 The major risks of the project are: limited institutional capacity to manage implementation,delays in counterpart funds for the project due to budget constraints, inability of local governments tomeet their revenue targets, and delays caused by protracted procurement procedures for works,materials/equipment and consultants. To minimize the risks, and as part of start-up activities and undera schedule agreed upon with the Bank, the cities will train their project managers and appoint consultantsto help with design, implementation and supervision. The financing plans have been endorsed by theagencies that will provide the domestic funding. Standard bidding documents and procedures have beendiscussed, with the local agencies and to the extent possible works have been packaged to attract largercontractors who normally deliver better quality works. Project implementation plans will be agreed atnegotiations, the programs will allow flexibility in adapting later year components to changing needs, asappropriate. The Bank has planned what is considered sufficient supervision resources, especially in theearly years, for early detection and solution of problems.
7. AGREEMENTS REACHED AND RECOMMENDATION
7.1 At negotiations the Borrower agreed inter alia to the following (recorded in Schedule 5,Parts A ((a) and (b) below)) and C ((c) to (h) below)) of the Loan Agreement):
(a) local government commitment to implement the agreed PJMs/LIDAPs/RIAPs includingincreases in fees for solid waste and sanitation (paras. 5.2, 5.3);
(b) PDAMs will implement tariff increases by no later than January I of 1996,1998 and 2000as necessary to fully cover O&M as of FY1996 and O&M and depreciation by FY1999(para. 5.6); PDAMs will consult the Bank, for any additional investment exceeding Rp2 billion; and to enhance the self-financing capacity of PDAMs, PDAMs will be allowedto retain profits and use them for their project investments (para. 5.7);
(c) to prepare and agree with the Bank on a revised training program no later than 6 monthsafter loan effectiveness (para. 4.4);
(d) payments to local contractors would be made from the KPKN provincial offices (para.4.14);
(e) to review with the Bank, not later than November 30 each project year, (i) the proposedbudgets for the following year, including any proposal to include a new project componentand (ii) the O&M expenditures for the previous year (paras. 4.19, 4.20, 4.28) and to issuethe respective budget approvals by January 15 for PDAMs and May I for other agencies,each project year (para. 3.16);
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(f) to carry out yearly technical audits and discuss the audit recommendations with the Bank(para. 4.17);
(g) a mid-term review with the Bank not later than June 30, 1998 (para. 4.19); and
(h) to resettle affected people according to the Resettlement and Rehabilitation Action Plansagreed with the Bank (para. 4.23).
7.2 The condition for loan effectiveness is that the Project Implementation Agreements andthe Subsidiary Loan Agreements under the Project have been executed, ratified, and are legally binding(paras. 3.17, 4.5).
7.3 The PPF including charges and accrued interest will be repaid from the loan uponeffectiveness (para. 3.20).
7.4 With the above agreements and assurances, the project would be suitable for a Bank loanof $136 million equivalent with a 20 year maturity including a 5 year grace period, at the standard Bank'svariable interest rate. The Borrower would be the Republic of Indonesia.
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Annex 1
INDONESIA.
KALIMANTAN URBAN DEVELOPMENT PROJECT
URBAN INFRAsTUCTURE PROJECTS'
Fiscal PPARLoan Year/ Closed/ Original PCRNo. Effective Closing Project Name Loan Rep. No. Year
1 1040 1975 1981 Jakarta Urban Development 25.00 4620 19832 1049 1975 1982 Five Cities Water Supply 14.50 6256 19863 1336 1977 1984 Second Urban Development 52.50 6329 19864 1653 1979 1987 Third Urban Development 54.00 8583 19905 1709 1981 1987 Second Water Supply 36.00 8622 19906 1972 1982 1988 Fourth Urban Development 43.00 8583 19907 2236 1983 1991 Jakarta Sewerage/Sanitation 22.40 12150 19938 2275 1983 1990 East Java Water Supply 30.60 10853 19929 2408 1984 1991 Fifth Urban Development 39.25 11501 199210 2632 1986 1993 Second E. Java Water Supply 43.3011 2725 1986 1992 Housing Sector Loan 200.00 13296 199412 2816 1987 1991 Urban Sector Loan 270.00 10388 199213 2817 1987 Oct 94 Reg. Cities Urban Transport 51.0014 2932 1988 Mar 95 Jabotabek Urban Development 150.0015 3219 1990 Dec 96 Second Jabotabek Urban Dev. 190.0016 3246 1991 Dec 96 Third Jabotabek Urban Dev. 61.0017 3304 1991 Dec 96 East Java-Bali Urban Dev. 180.3018 3340 1991 Dec 96 Sulawesi-Irian Jaya Urban Dev. 100.0019 3726 1995 Sept 99 Surabaya Urban Development 175.0020 3749 1995 Sept 99 Semarang/Surakarta Urban Dev. 174.00
Total 1,911.85
r' Jy 1. 1995 - 34 -
Annex 2.1 Main Project Components KUDP
SECTOR PROGRAM FOR BALIKPAPAN
1. Water Supply * Jpgrade existing headworks at Gunung Sari and Kampung Dawai to 500 I/s* Install 133 km of distribution, secondary and tertiary pipeworks (350 mm - 50 mm)* Install distribution pumping stations: acquire 2500 m
2of land.
* Provide 20.800 house connections and 350 public hydrants* Coistruct 2 distribution reservoirs of 500 m' capacity and 3 reservoirs of 1000 m" capacity* Training t;r PDAM staff to optimize the level of service from the facilities provided* Public educationi campaign
2. Sanitation a Construct 20 MCK as part of KIP* Construct 16 public toilets as part of KIP* Construct grey water leeching pits (60 units in KIP area)* Construct disposal site for septic tank waste* Procure septic tank desludging trucks (8)* Construct pilot sewerage system: 9.5km of sewer, treatment 611/s, 6000 connections* O&M of pilot system* Informationi campaign for 14500 households* Water quality monitoring management/reporting* Training tor 25 staff of 'Tk If* Sanitattioni program based oni results of mnoitoring & evaluation of the pilot sewerage scheme
3. Solid Waste 0 Acquire 8 hal lor linial disposal site aiid 500 m2 for transfer depot* Procure 40 conitainers, 276 hand carts.* Procure 15 dump trucks, 8 arm roll trucks 16 light trucks* Procure otne bulidozer, and ofie excavator* Construct final disposal site, 60 temporary disposal units, 32 container bases and 3 transfer
statiolns.* (Ofice anid worksholp equipment
4. Drainage * Rehabilitate and improve 5.8 km of primary, 16.6 km of secondary, and 18 km of tertiary drain* Ilrocure 2 dump trucks* Construct 5 km new primary drainage for low cost housing development.* (O&M for 6.33 km of primary. 15.7 km of secondary, and 56.4 km of tertiary drain)
S. Flood Control * Chaninel iormalizatioti and improvements to 3050 m of Klandasan BesarCost included in thedrainage component
6. Urban Roads TVPe New Improv. Rehab/Overlav Total.......... ............... km.
7. KIP, MIP * KIP for 9 Kelurahatn 232 tia* MIP for 3 markets 12 ha, 2250 m
2supserstructure
* Construct infrastructure for urban renewal, 20 ha (Gunung Sari Ilir)
8. Other/Supporting * Improvement Operation and Maintenance for all infrastructure sectorsProgram * Institutional improvement and human resources development
* Local revenue improvement action plan* Project preparation for future sectoral development
le:munnproJ. tp_
NU. Ff- IS. 15, _ 35 -
Annex 2.2 Main Project Components KUDP
SECTOR PROGRAM FOR PONTIANAK
I. Water Supply * Replace 7.85 km of defective secondary and tertiary pipework (generally in South Pontianak)* Replace 4900 defective consumer meters* Leak detection program* Construct 260 km of secondary and tertiary pipework (SOmm - 300mm)* Construct 25515 connections: 17640 house connections, 407 public hydrants,
and 7468 non domestic connections* Construct WTP extension at Imam Bonjol 300 I/s* Construct 4 distribution system booster pump stations* Construction of workshop, main office and laboratory for the PDAM* Undertake water resources study* Conduct training for PDAM staff* Conduct public information and education campaign
2. Sanitation * Construct septic sludge disposal site* Procure 6 desludging trucks* Rehabilitate 5600 m of open sanitary drains* Rehabilitate 12 MCK (as part of the KIP program)* Sanitation program based on results of monitoring and evaluation of pilots
3. Solid Waste * Land acquisition of 850 n9 for transfer stations and 20 ha for final disposal sites* Construct 52 interim disposal sites, 7 transfer depots, 30 container bases and final disposal site* Procure 6 light trucks, 26 dump trucks, 7 arm roll trucks and 36 arm roll containers* Procure one excavator, one bulldozer* Study of alternative disposal technologies
4. Drainage * Widening of main channels, within rights of way* Procure 3 dump trucks for O&M service and I mobile pump* Rehabilitate 14.9 km of primary, 7.8 km of secondary, and 18 km of tertiary draiis* Construct 4 hydraulic gates* (O&M for 16.6 km of primary, 8.2 km of secondary, and 26.0 km of tertiary drains)
5. Flood Control a Channel improvements (including lining and dredging) of 5.2 km of Raya river, 7.6 km of JawiCost included in the river, and 4.6 km of the Tokaya riverdrainage component.
6. Urban Roads Tlye New Improv. Rehab/overlay Total.............................. km.
7. KIP, MIP 0 KIP for 13 Kelurahan, 204 ha* MIIP for 8 markets, 40 ha, 3445 m' superstructure* Infrastructure to support low cost housing Siantar Hulu 6.5 ha* Public information campaign
8. Other/Supporting * Improvement Operation and Maintenance for all infrastructure sectorsProgram 0 Institutional improvement and human resources development
* Local revenue improvement action plan* Project preparation for future sectoral development
ile:sasnproj.ptk
Fr I'. 1155 - 36 -
Ainex 2.3 Main Project Components KUDP
SECTOR P'ROGRAM FOR PAI-ANGKA RAYA
1. Water Supply * Rehabilitate the existing treatment plant filters* Replace 2 backwash pumps and intake pump and pipeline* Replace 2 distribution pumps withi higher capacity units* Install secondary and tertiary pipework 11.9 km t) utilize increased capacity* Install new bulk water meter* Replace 3500 consumer meters* Replace approximately 3.4 km ot existing pipe-work* Procure and install 3x70 I/s new intake pumps and raw water pipes* Construct I x200 I/s treatment plant* Construct 212 kin ol distribution network pipeworks (50mm - 400(mm)* Construct 2500m
3distribution reservoir
* Procure and install 3 distributioni network booster pumps* Construct 11.432 house coniectionis. 170 public hydrants, 2426 nion domestic conmections* Construct olfice and workshop facilities
* Provide training and public iniformation campaigns* Undertake water sources study
2. Sanitation * Construct 12 MCKs as part of KilP* Procure 2 septic tanik trucks* Construct septic sludge disposal site 0.5 ha at the TPA* Provide f)&M for the septic sludge disposal site* Informationi campaign for 2800 households* Sanitation program based on results of monitoring and evaluation of pilot.
* Procure office equipment* Purchase I bulldozer and I excavator* Acquire land for transfer depot. 750( mZ* Construct a final disposal site. 2 transfer stations type 1, access road 300m.
70 interim disposal sites
4 I)rainage 0 Rehabilitate aind improve 24.9 kn of primary, 16.5 km of secondary,anid 19 kin of tertiary drain
* Rehabilitate 25 primary culverts anid 25 tertiary culverts(O&M for 24 km of primary, 16 kin of secondary. and 51 km of tertiary drains)
5. Urban Roads Road New Improv. Rehab/overlay Totaln............................ h
6. KIP. MIP 0 KIP for 3 Kelurahaii 90 ha* MIP for 4 markets 25 ha, 2250 in
2of superstructure
* Low cost housing infrastructure 30 ha
7. Other/Supporting * Improvement Operatiots and NMaintenance for all infrastructure sectorsProgram * Institutional improvement and human resources development
* Local revenue improvement action plans* Project preparation for future sectoral development
ie:mainproj.pTg
Dr5 May 26, 1996 - 37 -
Annex 2.4 Main Project Components KUDP
SECTOR PROGRAM FOR SAMARINDA
l I Water Supply * Replace 19 kn of tertiary service pipework, 8000 consumer meters (including purchase of4000 new meters), 5 hulk meters
L* eak detection program* Construct 200 I/s plant to be financed through KUDP* Procure aiid install 3xl00 I/s raw water intake pumps* Construct 700in of 400mm diameter transmission pipe.* 10 deep bores at 10 I/s each (altemative supply during dry season)* Extend the secondary and tertiary distribution system (50-350mm) by 77 km* Construct 3x1000m' service reservoirs.* Construct 17400 service connections and 420 public hydrants* Training: for PDAM contractors: for PDAM staff on public informationl* Water resource study
2. Sanitation * Acquire 0.2 ha interceptiots* Construct 10 public toilets (KIP)* Construct drainage interception to septic tanks* Construct septic sludge disposal site* Procure 6 septic tank trucks* Sanitation program based on results of monitoring and evaluation of pilots* O&M
3 Solid Waste * Acquire 5 lia for final disposal site, 100 nm for collection facilities* Procure 16 dump truck. 6 arm roll truck, 7 light truck, 35 container* Procure one excavator* Construct 130 interim disposal site. 16 container bases, 2 transfer stationi (type 11. 111)* Construct TPA and access road
4. Dramiiage 0 Reliabilitate aind improve 4.6 km of primary, 5.8 km of secondary, 3.2 km of tcrtiary drain* Rehabilitate 6 primnary channel culverts and 6 secondary channel culverts* (O&M for 11.6 km of primary, 18 km of secondary, and 57.4 km of tertiary chaninel)
5. Flood Conitrol * Chanisel normalization and improvements for 6 km of the Karang AsemCost included in the 0 O&M provisiol for 6 km of the Karang Asemdrainage component.
6. Urbani Roads Roads New Impro. Rehab/overlav Total............................... km.
7. KIP. MIP * KIP for 13 Kelurahan 232 ha* MIP for 6 markets 12 ha, 3455 m2 superstructure* Low cost housing infrastructure 60 ha (Sempaja, Sambutan, Pandans Wangi)* Infrastructure for urban renewal 20 ha (Karang Mumus)
8. Other/Supporting * Improvement Operation and Maintenance for all infrastructure sectorsProgram * Institutional improvement and human resources development
* Local revenue improvement action plan* Project preparation for future sectoral development
iri: mairiproj. smd
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Annex 2.5 Main Project Components KUDP
SECTOR PROGRAM FOR BANJARMASIN
(UNDER ITALIAN LOAN PROGRAM, NOT IN KUDP)1. Water Supply Water losses (UFW) program
Extension of production capacityExpansion of the storage capacityKUDP PROGRAMProcure 7 distribution system/WastepumpInstall 6,715 m transmission pipe 400 mm - 650 mm diaInstall 15,910 m primary mains 200 - 500 mm diaInstall 67,178 m of tertiary pipe 50 - 75 mm diaInstall 33,500 property connections and 250 public tapsExtension and in fill of the distribution network
2. Sanitation Provision of 7 desludging trucksPilot individual sanitation system ( 30 units)Pilot communal sanitation systems (4 systems)Pilot sewerage system: sewers and treatment facility for commercial areaTA for monitonng and evaluation of pilotsPublic information campaigns (38000 families)Sanitation program based on results of monitoring and evaluation of pilotsO&M
3. Solid Waste Management Closure works at the old disposal siteConstruct 142 temporary disposals, 8 transfer stations, 27 container basesand new disposal site 20 haProvision of 6 light trucks, 25 dump trucks, 6 arm rolls and 33 containersProvision of 2 bulldozer (D3,D6) and 1 excavator
4 Drainage Improve 7.9 km primary drains, 4.6 km secondary, and 15.6 km tertiary drainsMaintain of 11.9 km primary, 7.8 km secondary and 15.6 km tertiary drainsPublic campaignProcure 2 mobile pumps and 2 dump trucks
. Construct 3 hydraulic gates
5. Flood Control 300 m Steel sheet piling at Martapura(cost in 4 above)
Type New Improvement Rehablovearly ItI6. U rban R oads .. .............................. ....... km ............... ..............
1/ Including 400 m brdge; needs 4.4 ha land acquisition2/ Widening, drains or sidewalks (plus overdays in some cases)
7. KIP, MIP KIP for 26 locations 258 haMIP for 8 markets 40 ha, 4500 m2 superstructureInfrastructure development for 20 ha of pilot urban & housing renewalInfrastructure development for 5 ha of new low cost housing area
8. Other/Supporting Program Improvement Operation and Maintenance for all infrastructure sectorsInstitutional improvement and human resources developmentLocal revenue improvement action planFuture project preparation for sectoral development
L \FRI1A\XUDP\MAN1-BJM XLS
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Annex 3
KALIMANTAN URBAN DEVELOPMENT PROJECTSelected Documents in the Project File
Document Name Source Date LanguageProject Preparation Report (30 volumes) P.T. Virama Karya Aug. 1992 EnglishProject Preparation Report P.T. Virama Karya Dec. 1993 EnglishProject Preparation Report CKIMPW May, 1994 English
Balikpapan: Summary Report P.T. Virama Karya Oct. 1993 EnglishSummary Report CK/MPW May, 1994 English
Banjarmarsin: Summary Report P.T. Virama Karya Oct. 1993 EnglishSummary Report CKIMPW May, 1994 English
Palangkaraya: Summary Report P.T. Virama Karya Oct. 1993 EnglishSummary Report CKIMPW May, 1994 English
Pontianak: Summary Report P.T. Virama Karya Oct. 1993 EnglishSummary Report CK/MPW May, 1994 English
Samarinda: Summary Report P.T. Virama Karya Oct. 1993 EnglishSummary Report CK/MPW May, 1994 English
Medium Term Development Program (PJM) P.T. Virama Karya Aug. 1992 Indonesian(All 5 cities)Revenue Improvement Action Plans (RIAP) P.T. Virama Karya Oct. 1993 Indonesian(All 5 cities)Local Institutional Development Action Plans (LIDAP) P.T. Virama Karya Oct. 1993 Indonesian(All 5 cities)
Updated Memorandum Teknik P.T. Virama Karya Oct. 1993 EnglishUrban Roads EnglishDrainage and Flood Control EnglishPublic Housing (Perumahan Rakyat) EnglishSolid Waste (Persampahan) EnglishHousing Renewal Report C. Karya May, 1994 English
Environmental Assessment Summary Report (draft) P.T. Virama Karya March, 1994 EnglishEnvironmental Assessment Summary Report (Final) P.T. Virama Karya April, 1994 EnglishDetailed Environmental Reports (All 5 Cities) P.T. Virama Karya April, 1995 EnglishEnvironmental Document Review P.T. Bita Bina Semesta 1994 EnglishResettlement Plan - Banjarmasin Ring Road Banjarmasin City Aug. 1994 IndonesianReview of Resettlement and Environment Issues World Bank Sept. 1994 English
Terms of reference, letter of invitation for proposals, C. Karya May, 1994 Englishfor I st year TA and engineering services.
KUDP Project Cost SummaryKalimantan Urban Development Project (KUDP) Costing and Financial Model L _______ IANNEX 4Summar b C (excluding PPF US 1 7 milihon) _ _ -_ _ o i t
Banjarmasin % of total Balikpapan % of total Palangka % of total Ponbanak % of-total Samarinda % of total Total. . _ ~~~base cost _.base cost Raa base cost, base cost _.base cost
Water Supply (PDAM) BASE COST 19_,752 20.6% 12,298 21.4% 15,123 _ 43.4% 25,862, 32.5%° _ __13,024 26.5% 86,059
KUDP Project Cost SummarySummary by Subsector l lANNEX 4(excuding PPF US 1.7 million, including FEI bPV) Rp. million (Current Prices)
Banjarmasin % of total Balikpapan % of total l2ngka Ra % of total Pontianak % of total Samarinda % of total Total_ _ _ _ _ _ _ _ _ program program _ro_r ___M__ program
Water Supply (PDALM)Investffment 28,37t 18,019 , 21,53 36.217 19,343 123,480
Overall Coord. and Guidance. Grant Approval X XOverell Tech. Sup. and Supervision X _Overag Project Moritoring and Reporting XOverall Fin. Mgt. ISpeclal Acct and onlending_ xOverall Institution and Human Resource Devit xProject Completion Report X X X x x x
Implementatlon of InlrastiruCture Investments X X X XMajor Consultant Selection i X X _ X X XSpecialized Support Itech, financIal & trainingl X X X XExpenditure Programs and Annual Budgets X X X X XProcurement of Goods, Wotks end Local Cons. X x x xSupervision, Certification & Progress Reporting X x x xDisbuxsement and reImbunsement requests | _ X X XProlect and annual accounts fin. prog. reporting X X X
Xo
a,.
Kalimantan Urban Development Project (KUP)_ Consultants Services
_. ~~~~ ~_ _ _ ._ . __ I_ 1. _ _ __ _,
_ _ _ Funding Source
No COMPONENT NAME IMPLEMENTING STAFF MONTHS PAC- Total Cost
AGENCY Junior senior KAGE PADS PDAM SPABP APBN APBN_I_ __ PBB Tk. II BLN DIP
IDETAIL ENGINEERING AND SUPERVISION =_-_=_=_==-
1 LOCAL DRAINAGE, ROADS, ON-SITE SANITATION, SOLIDWASTE 5 _
a. - Banrmasin 2nd-5th year Dinas PU Tk. II Banjarmasin 200 0 1 173 0 1,730 1,903b - Palangka Raya 2nd-5th year Dinas PU Tk. II Palangka Ray 110 0 1 66 0 655 721c - Balikpapan 2nd-5th year Dinas PU Tk. II Balikpapan 185 0 1 154 0 1,538 1,692d - Samarinda 2nd-5th year Dinas PU Tk. II Samannda 190 0 1 144 0 1,440 1,584_ - Pontianak 2nd-Sth year - Dinas PU Tk. II Pontianak 205 0 1 105 0 1,0451 1150
- 2nd-5th year (inclSupplementary FS, FED & Supervision forMartapura Bridge) Binkot, Binamarga 270 1 0 1 I I 2.905 726 3,632
4 PRIMARY DRAINAGE- FED & Supion major drainage in 5 toNns and flood control works i sPontianak, Balikpapan & Samarinda DJCK & related Dinas PU Tk. 370 0 1 , _ 1539 385 1,924 o
5 RIVER PROTECTION Dit. Sungai, Pengairan _ 396 99 495
_ 6 LRGENT FIRST YEAR DED & SUPERVISION (COMBINED IN 11.1.a) DJCK 210 50 |Combined in 1 0 0 0 2.896 724 3,620
S:PROJECT MANAGEMENT TRAINING _ f 18 9 1 0 0 0 1,515 379 1,893
-b DLLAJR Tk I and DG Land '6 TRAFFIC MANAGEMENT PROGRAM FOR B.MASIN,8.PAPAN,PONT Transport 701 15 1 105| 0 1,045 0 0 1.150
Low Cost Housing & Urban Renewal Sector: Project Preparabon &7!DevelopmentActionPlanforHousing&UrbanRenewal __ JCK & related Dinas PU Tk. 70 12. 1 o 0 o0 848 212 1,060
DEVELOPMENT of Appropriate Waste Disposal System For PontianaR ;uslitbarngtan & related Dinas,8 & Samarinda including impo_f Pilot Project PU Tk. II 1161 0_ 1 _01 0L 0 9261 232 1,158
. 1WATER SUPPLY DEVT. STUDY FOR PONTIANAK BALIKPAPAN| - - I _______
91 AND BANJARMASIN (Focussed on Water Resource Management) DJCK 90 30 1 0 0 0 1,440 360 1,800
WATER SUPPLY 948 X _ _ ____ - PDAMDetailed Design and Supervision _ __ __
Land Acquisition- Pontianak-Balikppan Procurement of GoodsCivil Works Construction ___ _ _ _ _
DRAINAGE h FLOOD CONTROI 51.2Detaled Design and Supervision DPU 11, DPU 1. DGCKProcuremnt of Goods _Civil Works Construction
H 25.4 _ _ _ 3 DPU II, DGCKDetailed Design and Supervision _ _ __- _ _Land Acquisition- SmarindaProcurement of GoodsCivil Works Construction ___ _ ___ =_
Dec 30, 2000 100% 0.5 136(a) Standard disbursement profile for Asia, urban projects, from Board approval.(b) Disbursements expected to be faster than standard profile in early years due to long project preparation period.(c) Loan effectiveness date assumed as June, 1995; Loan closing date: June 30, 2001.file:\excel\frida\kudp\annexl O.xis
Kalimantan Urban Development ProjectSupervision Staffing and Schedule
Mission FY Mission Mission Task Task Civil/ Civil/ Water& Water& R&Env. R&Env. Pcmt Pcmt Fin Fin Total Total GRANDN Start Date Duration Mgr (S) Mgr (S) Road Road San Eng San Eng Spec Spec (RSI) (RSI) Anal Anal TOTAL
(Weeks) Eng Eng (C) (C) (RSI) (RSI) (C) (C)(S) (S)
PONTIANAK /2TPA 200,000 0 /3 - 95/96 1203 TRANSFER SITES 850 3 95/96 183 WATER 6,250 3 94/95 0.4
RESERVOIRS
SUB TOTAL 207,100 6 138_4
PALANGKARAYATRANSFER SITE 750 1 - 95/96 3
SUB TOTAL 750 1 95/96 3
TOTAL 386,950 57 39 598.4(39 ha) .
Source: Local Governments, Bank Staff
Note: /1 Waste water/sewerage systems will be proposed following studies to be made under the project. Land & resettlement implicationswill be known when decisions are made.
/2 Study will determine whether land is needed for flood control./3 Vacant, govemment-owned land, but agency needs to acquire.
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Annex 12Page 2
2. The Project Implementation Agreements with the local governments include the following criteria forResettlement Plans in line with GOI policy under KEPPRES 55/1993:
(a) Displaced households will have an option between cash compensation and moving to a resettlementsite. Households left with less than 60 m2 following acquisition will also be eligible for resettlment benefits.
(b) Cash compensation will reflect at least the NJOP level.
(c) The compensation value for land taken by the project will be sufficient to pay for an area of land atthe new site with at least the same area.
(d) Compensation for the building at the old site will be sufficient to build a new house of the samequality. Displaced families will also be allowed to take the old building materials from the previous site.
(e) Displaced families will have the option between buying standard houses built by a developer at a newsite, or building their own houses of suitable size and quality.
(t) At the resettlement site, the Government will provide reasonable infrastructure levels, such asfootpaths, roads, drainage, water, electricity, and public facilities such as schools, health services,transportation, etc., if not already available.
(g) People will be given assistance to restart and develop at the new site any small businesses displacedfrom the previous site.
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Annex 13Page 1
KALIMANTAN URBAN DEVELOPMENT PROJECTMitigation of Negative Environmental Impacts
1. The following criteria will be provided to consultants preparing designs and tocontractors executing works under the proposed project, to mitigate potential negativeenvironmental impacts.
Dredging of Drains and Floodways
2. All of the rehabilitation and up-grading work of drains in each city will involvepreparatory dredging. The spoil is probably severely contaminated with human waste,industrial wastes, and lead benzene from storm water runoff. Care must be taken in thedredging and disposal of the spoil. Prior to dredging, a plan of action to mitigate potentialenvironmental damage will be prepared by the consultant and submitted to the Bank fortechnical review and approval prior to contracting this work. The plan should take intoaccount the following criteria:
i) the method of dredging should ensure minimal dispersal of pollutants bothduring the dredging when metals can become resuspended in the water andduring hauling when the wet sludge can slosh onto the road. Possible optionsmay include;
a) using temporary suspended platforms during dredging and construction forde-watering sludge prior to transport,
b) using boats for transport of sludge and drying before off loading to a truckfor final disposal, and
c) providing by-pass pumping (where feasible) of up stream flow to dewaterand isolate an area thus preventing resuspension of pollutants in the water.
ii) the final disposal site(s) at the TPAs should be selected to ensure that the spoildo not enter and pollute local watercourses. The spoil could also be consideredas capping material for existing landfills which are scheduled to close.
iii) the spoil should not be composted with sludge or organic wastes unless theyhave been tested and shown not to contain heavy metals or other toxics.
In all locations, construction should adhere to MPW Construction SOPs for urban drainage(Petunjuk Teknis, Proyek Drainase Perkotaan 1990). Where there is a possibility of landslipsoccurring during construction, shoring will be required to prevent damage to adjacentproperties and/or infrastructure.
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Annex 13Page 2
Road Widening and Upgrading
3. In some locations construction of new roads could lead to induced development,particularly the ring-road in Banjarmasin. Local BAPPEDAs will prepare land use and zoningplans under the project that take into account such potential development. In addition, roadconstruction in wetland areas can affect the cross drainage of surface & ground water severelydaminising the quality of the environment. All road design & construction should mitigatesuch negative impacts by providing adequate cross drainage. In a number of cities, roadimprovement may entail disruption of traffic, especially on smaller collector roads which willneed to be managed. The following conditions should be part of contracts let for roadwidening or upgrading.
i) In all locations construction should adhere to MPW Construction SOPs forroads (Petunjuk Teknis, Proyek Jalan dan Jembatan 1990).
ii) In locations where severe and/or prolonged disruption of traffic will occurduring construction, alternative routes should be selected in advance andcoordinated with local police and traffic authorities.
iii) All construction sites should have traffic signs and safety barriers erectedthroughout the construction period, construction materials should be stored ina manner that does not impede traffic flow, and the adjacent road should bemaintained free of spoil and other waste materials during construction.
Solid Waste Disposal Sites (TPA)
4. In all five cities the construction and operation of the solid waste disposal sites shouldadhere to MPW Solid Waste Disposal SOPs (Petunjuk Teknis Proyek Persampahan, 1990/92).Toxic substance disposal should be coordinated with the industrial, hazardous, and toxic wasteprogram through the Ministry of Industry and Bappedal including provision or toxic substancedisposal at the TPA.
5. Because of the possibility of ground water pollution by uncontrolled runoff and plansto use the TPAs for sludge disposal (from dredging and sewerage treatment), particular careis required in the design and construction of these facilities. It is recommended the followingcontractual arrangements for engineering design and construction be required:
i) Prior to initiation of detailed engineering design, the preliminary technical plansand drawings for each TPA must be submitted to the Bank for technical reviewand approval by a waste disposal and sanitation expert of the Bank.
ii) Prior to finalisation of detailed engineering designs the plans, drawings andspecifications for each TPA must be submitted to the Bank for review andapproval by a waste disposal and sanitation expert of the Bank.
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Annex 13Page 3
iii) Prior to completion of construction or commissioning of each TPA, each of themunicipal authorities be required to submit to the Bank a detailed staffing andtechnical plan for operation of the TPA, including the leachate treatment plant.
6. The design of TPAs should take into account the following criteria:
i) each TPA will have an area for sludge and composting/organic recycling.
ii) scavengers will be allowed to recycle waste.
iii) provision of a ground-water cut-off barrier, together with leachate treatmentfacilities to prevent contamination of the surrounding ground-water table, maybe needed.
iv) compacting may be acceptable if adequate soils are not available for "sanitary"operation.
v) consideration should be given to capping the existing landfills scheduled forclosure with the drainage spoils and then with a top layer of dewatered sludgewhich has been composted with organic solid waste. The top layer should thenbe planted with cover reduced the amount of precipitation entering the landfill.Any precipitation which manages to flow through the organic zone will becomeanoxic thus preventing the resuspension of metals in the seepage water. Thiscould provide and excellent method of both sludge, drainage spoils, and organicsolid waste disposal.
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Local Government Flnsnce: Banjaqiasin Page 1 of 392193 93194 94195 95/98 96197 97/98 98/99 99/00 Total
1 995/6-1 999/00
Local revenue:Properly tax tP6BW 1.0 1.6 1.7 2.1 2.4 2.8 3.8 5.3 16.4Other taxes and feea (PADS) 5.5 7.2 8.6 9.9 10.6 11.5 13,9 16.9 62.8Total local revenues 6.5 8.8 10.3 12.0 13.0 14.3 17.7 22.1 79.1Central grants not of slarie/penaions 0.9 1.1 1.3 1.5 1.7 1.9 2.1 2.4 9.6
Total available for IUIOP /3 1.7 1.8 6.8 10.3 9.4 11.5 11.5 12.2 61.7
\1 Includes non-IUIOP incremental O&M\2 Including allocation for tax on projects financed by SLA\3 Excludes private contributions\4 Not equal to nmplementation total in Table 4.2 because some land acquisition financed by local government is Included
Total avadlable for lUIDP/3 3.3 3.1 8.6 10.3 12.6 12.9 13.1 12.9 70.4
\1 Includes non-IUIDP incremental O&M\2 Including allocation for tax on projects finenced by SLA\3 Excludes private contributions\4 Not equal to implementation total in Table 4.2 because some lend acquisition financed by local government Is Included
Total available for IUIDP /3 0.4 0.5 3.7 5.4 5.9 0.2 5.7 6.2 35.2\1 Includes non-IUIDP incremental O&vM\2 Including allocation for tax on projects financed by SLA\3 Excludes private contributions\4 Not equal to implementation total in Table 4.2 bcaue acme Iand equlaltion financed by local governernnt is included
Total available for IUIDP 13 -0.6 -0.3 5.7 8.8 9.5 11.3 11.1 14.6 50.O
\1 Includes norl-ILDP incremental O&M\2 Including allocation for tax on projects financed by SLA\3 Excludes private contributions\4 Not equal to impleernntation total in Table 4.2 bcatuS aome Ind acquisition financed by local government is included
Total available for IUIDP 13 0.0 0.0 7.7 11.2 12.4 11.5 12.4 15.2 70.3\1 Includes non-IUIDP incremental O&M\2 Including allocation for tax on projects financed by SLA\3 Excludes private contributions\4 Not eual to implementation total in Table 4.2 because some land acquisition financed by local government is included
Total 85,806 11,536 928 100,770 n.a. 1,590 1.55 3.07 608 1,370 7611/ About 6 persons per house connections and some 120 lcd; and about 100 persons per tap, and some 30 lcd.
Table 2 - Drainage and Flood Control
City Drainage Improvement km Affected AreaNew Primary Secondary Terts. Total ha % of city area
Total 99 1,016 457 101.5 27.9 64 12.8 1,182 497 12 261/ Pathways/access roads, solid waste collection, drainage and sanitation. (Cost of water supply and the sanitation program are included in
the respective sector programs).
2155 units per ha; assumed an average 5 persons per unit, or 275 persons/ha3/ Sianar Hulu, 4/ Sungai Tinga; 51 Gunung Sari Ilir, 6/ Senpaja, Sambutan, Pandan Wangi; 7/ Karang Mumus
