Page 1 INTEGRATED SAFEGUARDS DATASHEET APPRAISAL STAGE I. Basic Information Date prepared/updated: 09/03/2009 Report No.: AC4342 1. Basic Project Data Country: Mexico Project ID: P107159 Project Name: MX Urban Transport Transformation Progr Task Team Leader: Walter Vergara Estimated Appraisal Date: August 17, 2009 Estimated Board Date: November 17, 2009 Managing Unit: LCSTR Lending Instrument: Specific Investment Loan Sector: General transportation sector (100%) Theme: Climate change (67%);Environmental policies and institutions (33%) IBRD Amount (US$m.): 200.00 IDA Amount (US$m.): 0.00 GEF Amount (US$m.): 0.00 PCF Amount (US$m.): 0.00 Other financing amounts by source: Borrower 1,825.00 Carbon Fund 0.00 Clean Technology Fund 200.00 2,025.00 Environmental Category: A - Full Assessment Simplified Processing Simple [] Repeater [] Is this project processed under OP 8.50 (Emergency Recovery) or OP 8.00 (Rapid Response to Crises and Emergencies) Yes [ ] No [X] 2. Project Objectives The Project Development Objective is to contribute to the transformation of urban transport in Mexican Cities to a lower carbon growth path. This objective will be achieved by improving the quality of service provided by the urban transport systems in a cost efficient manner, and by deploying equipment, infrastructure, and operational strategies that reduce CO2 emissions. Achieving the PDO will significantly reduce the transport sector carbon footprint and the emission of related air toxics. 3. Project Description The project includes the following components: Component 1 - Capacity Building: This component will finance capacity building at State level and in the participating cities, for developing or strengthening the local urban transport development process. The capacity building activities include: (i) preparation, update or completion, of Integral Transport Plans (ITP) including climate change considerations; (ii) development of plans for modernizing traffic management, efficient allocation of public space for transport related services, and non-motorized transport; (iii) support for urban transport institutions responsible for sector coordination (iv) training Page 2 and skill development of local government staff and other civil servants in areas relevant to sustainable urban transport. Component 2 - Development of integrated transit systems: This component will finance mass transit corridors and ancillary investments: a) Integrated Mass transit Corridors # Development of Integrated Mass Transit Corridors in cities that have an ITP. The financing of such corridors includes but is not limited to: preparation, design, construction, supervision, maintenance and rehabilitation of roads for trunk lines and feeder roads, terminals, yards, transfer and access stations, mixed traffic lanes adjacent to the project, rolling stock, signaling, control centers, information systems, environmental monitoring equipment, and fare collection systems. b) Other low carbon transport investments # Traffic management measures, optimization of public space for mass transport, non-motorized transport, universal access facilities, bike-transit integration, vehicle use restriction, safety and security programs, demand management marketing and promotion, freight management, and car free planning. Component 3 - Promotion of low carbon bus technologies and scrapping of buses: This component will facilitate market penetration of low-carbon vehicle technologies and scrapping of old and displaced vehicles: a) Market penetration of low-carbon transit technologies (low-carbon rolling stock) # These vehicles would not be purchased otherwise, because they represent an additional financial commitment to the operator that is not readily justifiable by current market conditions. Financing this sub component will help cities obtain low-carbon buses without having to transfer the additional cost of acquisition to the user. b) Scrapping of old and displaced vehicles # This sub-component will finance scrapping programs including: (i) institutional capacity to develop/adopt clean and environmentally sound scrapping strategies (including dismantling process, classification, disaggregation, and final disposal in recycling plants or landfills, and financial mechanisms for implementation), (ii) the purchasing of displaced rolling stock, and (iii) the implementation of the scrapping process. Component 4 - Project Management: This component will support the overall technical coordination of activities within the cities through a project implementation unit (including the implementation of a technical monitoring system) as well as the administrative and financial management of the eligible projects. It will include goods, consultancy services, travel, and operating costs undertaken for project management. This component could finance the project staff of the implementing agencies, such as coordinator, procurement specialist, environmental and social specialists, and other required personnel for project management, as well as external audits, and project indicators, monitoring and evaluation. 4. Project Location and salient physical characteristics relevant to the safeguard analysis The program targets the transformation of the urban transport sector in Mexico in order to improve the efficiency of delivery of transport services in urban areas, and towards a low carbon path through activities that would reduce its carbon footprint. The UTTP will support the PROTRAM (Federal Support Program for Mass Transit). PROTRAM is open for all cities that comply with some minimum criteria set in the Page 3 guidelines of the program. As such, cities and projects that will be subject to Bank financing will not be known until after effectiveness. The Bank agreed with the government to prepare a resettlement policy framework. In accordance with this agreement, the government has prepared a Social and Environmental Management Framework (MASTU ) in order to ensure that all financed projects comply with social and environmental sustainability principles as identified in the Bank#s safeguards policies. The MASTU will guide cities on how to ensure proper consideration of environmental and social aspects within their project cycle. The MASTU establishes the social and environmental procedures and institutional responsibilities to ensure that projects will include adequate prevention, mitigation and compensation measures to address and minimize the potential environmental and social impacts of construction and/or operation of the different projects. The MASTU also includes grievance and conflict solution mechanisms as well as dissemination guidance at the various phases of the project cycle. The mainstreaming of these procedures by participating cities ensures that projects will have fulfilled national/state/local regulations as well as the Bank#s safeguards requirements. The MASTU has a clear set of guidelines that incorporates the experience of cities on urban transport projects executed in Mexico. The program is expected to have positive environmental and social impacts in the long-run, since it aims at improving the quality of public transport and non-motorized transport systems and improve traffic flow and passengers safety. The program is designed to have a positive long-term impact due to the reduction of global and local emissions, as CO2, NOx, SOx, Particulate matter, and other contaminants currently present. The reduction will be directly linked to improved vehicle operation, reduced trip lengths, use of more efficient modes of transport and improved technologies. A detailed screening # using standard forms # of the different project sites will confirm that none are close to natural habitats or environmentally sensitive areas. The main direct impacts are expected to occur during construction and cause localized negative environmental impacts and temporary social impacts. Such impacts are expected to consist essentially of noise, vibration, dust, and traffic disruption, and limitations accessing houses and business. Additional negative impacts during the follow-on construction stage will occur due to haulage and final disposal of materials. Environmental impacts associated to the operational phase will mainly include emissions of air pollutants and waste generation (e.g., oils). Most of these impacts will be mitigated by proper designs and the implementation of environmental and social management plans to be followed according to the procedures defined in the MASTU. In addition, the proposed UTTP is expected to have positive impacts on living standards of the population by improving physical access and quality of public transport, enhancing non- motorized infrastructure, and improving the built environment. 5. Environmental and Social Safeguards Specialists Ms Maria E. Castro-Munoz (LCSSO) Ms Carla Della Maggiora (LCSEN) Page 4 6. Safeguard Policies Triggered Yes No Environmental Assessment (OP/BP 4.01) X Natural Habitats (OP/BP 4.04) X Forests (OP/BP 4.36) X Pest Management (OP 4.09) X Physical Cultural Resources (OP/BP 4.11) X Indigenous Peoples (OP/BP 4.10) X Involuntary Resettlement (OP/BP 4.12) X Safety of Dams (OP/BP 4.37) X Projects on International Waterways (OP/BP 7.50) X Projects in Disputed Areas (OP/BP 7.60) X II. Key Safeguard Policy Issues and Their Management A. Summary of Key Safeguard Issues 1. Describe any safeguard issues and impacts associated with the proposed project. Identify and describe any potential large scale, significant and/or irreversible impacts: Given that cities subject to financing will not be known before appraisal, and the complexity of implementing these works in dense urban areas and potential environmental and social impacts, the UTTP has been in principle qualified as Category A, and the program considers the use of an Environmental and Social Management Framework (MASTU) that will guide cities on how to ensure proper consideration of environmental and social aspects within their project cycle. The MASTU establishes the social and environmental procedures and institutional responsibilities to ensure that projects will include adequate prevention, mitigation and compensation measures to address and minimize the potential environmental and social impacts of construction and/or operation of the different projects, including the protection of cultural assets. The mainstreaming of these procedures by participating cities ensures that projects will have fulfilled national/state/local regulations as well as the Bank#s safeguards requirements. The MASTU has a clear set of guidelines that incorporates the experience of cities on urban transport projects implemented in Mexico. At present, the MASTU is fully embraced by the national government. In general, no large scale, significant and/or irreversible impacts are expected. However, in particular, for the case of BRT (bus rapid transit), there are some critical points in each corridor which require a close consideration at the early planning and design stage; and especially during the infrastructure works. These include the potential effect on historic and cultural heritage sites, on socially vulnerable spots. Moreover, implementation of the BRTs has the potential to cause involuntary displacement in some corridors, particularly limited access to businesses and displacement of some of the current operators. Main localized negative environmental impacts are expected to occur during construction. Such impacts are expected to consist essentially of noise, vibration, dust, and traffic disruption. Additional negative impacts during the follow-on construction stage will occur due to haulage and final disposal of materials. Environmental impacts associated to the operational phase will mainly include emissions of air pollutants and waste generation (e.g., oils). Most of these impacts will be mitigated by proper designs and the implementation of environmental and social management plans to be followed according Page 5 to the procedures defined in the MASTU. In the case of cultural assets, protection measures will be set up following national regulations under the supervision of INAH (National Institute of Anthropology and History) following the process described in the MASTU. 2. Describe any potential indirect and/or long term impacts due to anticipated future activities in the project area: The program is expected to have positive environmental and social impacts in the long- run, since it aims at improving the quality of public transport and non-motorized transport systems and improve traffic flow and passengers safety. The program is designed to have a positive long-term impact due to the reduction of global and local emissions, as CO2, NOx, SOx, Particulate matter, and other contaminants currently present. The reduction will be directly linked to improved vehicle operation, reduced trip lengths, use of more efficient modes of transport and improved technologies. A detailed screening # using standard forms # of the different project sites will confirm that none are close to natural habitats or environmentally sensitive areas. The main direct impacts are expected to occur during construction and cause localized negative environmental impacts. Such impacts are expected to consist essentially of noise, vibration, dust, and traffic disruption. Additional negative impacts during the follow-on construction stage will occur due to haulage and final disposal of materials. Environmental impacts associated to the operational phase will mainly include emissions of air pollutants and waste generation (e.g., oils). Most of these impacts will be mitigated by proper designs and the implementation of environmental and social management plans to be followed according to the procedures defined in the MASTU; this process includes the protection of cultural assets. As indicated above, the environmental and social management procedures to be followed by all activities financed by the program are also described in the MASTU. Environmental procedures described in the MASTU are based on the Federal Law on Ecological Equilibrium and Environment, and other relevant federal ordinances, as well as state and local regulations, complemented with the necessary procedures to ensure that safeguard#s requirements will be met. Cities will be responsible for the implementation of the MASTU, and at the national level SEMARNAT will supervise the fulfillment of the MASTU environmental procedures in the projects. SEDESOL, the national entity in charge of urban development will overlook management procedures to avoid or mitigate social impacts. Both agencies are members of the Consultative Group of PROTRAM that will be in charge of overlooking urban projects seeking financing from the UTTP. Protection of cultural assets will follow national regulations under the supervision of the INAH. 3. Describe any project alternatives (if relevant) considered to help avoid or minimize adverse impacts. Given that specific projects funded under the UTTP will not be known before appraisal, the program considers the use of an Environmental and Social Management Framework (MASTU) that will guide cities on how to ensure proper consideration of environmental and social aspects within their project cycle. Page 6 Specifically, the MASTU consider the assessment of alternatives as part of the project cycle of any project subject to financing under the UTTP. 4. Describe measures taken by the borrower to address safeguard policy issues. Provide an assessment of borrower capacity to plan and implement the measures described. The government of Mexico has prepared the Social and Environmental Management Framework (MASTU) to be implemented by all cities seeking financing under the UTTP. The MASTU has been designed as a tool to facilitate the inclusion of environmental and social management procedures in the design, implementation and operation of a project for cities willing to participate in the UTTP. It includes: (i) information about the Program#s legal and institutional framework; (ii) procedures and responsibilities of the different stakeholder involved; and (iii) general guidelines to prepare environmental assessment (environmental impact assessment and environmental management plans) and social assessment and programs to be adapted to conditions of each city The MASTU main objectives include the following: # Identify and assess social and environmental impacts derived from projects; # Mainstream social and environmental procedures from an early stage in the project cycle; # Guide the preparation as needed of Environmental Assessments and Social Management Plans to avoid or mitigate impacts; and # Introduce consultation procedures that ensure broad stakeholders# participation. Cities will be responsible for the implementation of the environmental and social procedures set in the MASTU, while at the national level, SEDESOL and SEMARNAT, as members of the Consultative Group overlooking the project will be responsible for supervising its implementation for all projects in the UTTP. Cities are expected to implement the procedures described in the MASTU and through this process, to mainstream its procedures in their project cycle. This means that each project should have technical management capacity, including adequate instruments (e.g., environmental manuals, adequate regulations, and specialized social units) and qualified staff. Project planners will follow due diligence procedures, including monitoring and tracking of key aspects of the process, to provide assurance that the procedures of the MASTU are being implemented. SEDESOL, through its Division of Urban Development, supports urban development and poverty alleviation local level plans and programs. It supports programs to provide for basic infrastructure at the state and local levels, and provides technical assistance in the management of basic urban services. SEDESOL will be responsible for the revision of all the documentation dealing with social issues described in the MASTU. SEMARNAT mission is to promote the protection, restoration and conservation of ecosystems and natural resources, goods and environmental services, aimed at ensuring a sustainable development. SEMARNAT will be responsible for the revision of all the documentation dealing with environmental issues described in the MASTU. Although specific projects funded under the UTTP will not be known before appraisal, assessment of the institutional capacity at the local level in sample cities (i.e., Monterrey and Leon) indicate that they have started to mainstream social and environmental management into their project cycle. Page 7 Main observed features of these two cities include that: (i) both have developed their own methodologies to incorporate social considerations into the design and implementation phases of urban transport projects based on lessons learnt from previous experiences; (ii) environmental management has generally been institutionalized, and projects# teams include social management units capable of managing social impacts associated to the projects. However, both cities recognize the need of further technical assistance to consolidate their capacity; and (iii) they both understand the benefits of embracing the consultation process formulated in the MASTU and are very willing to adopt it. Other cities that may fulfill the criteria to participate in the project have also adopted social and environmental processes based on their experience in the previous Medium Cities Urban Transport Project in Mexico and their contribution to prepare a previous version of the MASTU. 5. Identify the key stakeholders and describe the mechanisms for consultation and disclosure on safeguard policies, with an emphasis on potentially affected people. The consultation process is divided into two levels: program and project level. The program consultation refers to the consultation of the MASTU per se. This consultation took place in March 2009 in Mexico, and included NGOs, cities interested in participating in the project, governmental agencies, research institutes, transport consulting companies, and bus operators among others. Comments and feedback from stakeholders have been incorporated into an updated version of the MASTU, to be disclosed before appraisal. The second level of consultations refers to consultation with stakeholders directly involved in specific projects, which will be carried out at each participating city. Both types of consultation are also described in the MASTU (e.g., Environmental impact assessments, Social impact assessments, Resettlement plans, etc.). Annex 3 of the MASTU provides general guidance for project developers in reference to the consultation process at three distinct levels: (i) general information to the public; (ii) consultation with key stakeholders; and (iii) consult and participation of potential affected people and/or groups. At the local level, the consultation process will involve meetings and forums with local authorities (municipalities), communities# grass-root organizations and local and regional NGOs and university development institutions as well as the federal participating institutions (SEMARNAT, SEDESOL, BANOBRAS, FONADIN). B. Disclosure Requirements Date Environmental Assessment/Audit/Management Plan/Other: Was the document disclosed prior to appraisal? Yes Date of receipt by the Bank 01/15/2009 Date of "in-country" disclosure 01/23/2009 Date of submission to InfoShop 01/29/2009 For category A projects, date of distributing the Executive Summary of the EA to the Executive Directors 07/07/2009 Resettlement Action Plan/Framework/Policy Process: Was the document disclosed prior to appraisal? Yes Page 8 Date of receipt by the Bank 01/15/2009 Date of "in-country" disclosure 01/23/2009 Date of submission to InfoShop 09/03/2009 Indigenous Peoples Plan/Planning Framework: Was the document disclosed prior to appraisal? Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop Pest Management Plan: Was the document disclosed prior to appraisal? Date of receipt by the Bank Date of "in-country" disclosure Date of submission to InfoShop * If the project triggers the Pest Management and/or Physical Cultural Resources, the respective issues are to be addressed and disclosed as part of the Environmental Assessment/Audit/or EMP. If in-country disclosure of any of the above documents is not expected, please explain why: C. Compliance Monitoring Indicators at the Corporate Level (to be filled in when the ISDS is finalized by the project decision meeting) OP/BP/GP 4.01 - Environment Assessment Does the project require a stand-alone EA (including EMP) report? Yes If yes, then did the Regional Environment Unit or Sector Manager (SM) review and approve the EA report? Yes Are the cost and the accountabilities for the EMP incorporated in the credit/loan? Yes OP/BP 4.11 - Physical Cultural Resources Does the EA include adequate measures related to cultural property? Yes Does the credit/loan incorporate mechanisms to mitigate the potential adverse impacts on cultural property? Yes OP/BP 4.12 - Involuntary Resettlement Has a resettlement plan/abbreviated plan/policy framework/process framework (as appropriate) been prepared? Yes If yes, then did the Regional unit responsible for safeguards or Sector Manager review the plan? Yes The World Bank Policy on Disclosure of Information Have relevant safeguard policies documents been sent to the World Bank's Infoshop? Yes Have relevant documents been disclosed in-country in a public place in a form and language that are understandable and accessible to project-affected groups and local NGOs? Yes All Safeguard Policies Page 9 Have satisfactory calendar, budget and clear institutional responsibilities been prepared for the implementation of measures related to safeguard policies? Yes Have costs related to safeguard policy measures been included in the project cost? Yes Does the Monitoring and Evaluation system of the project include the monitoring of safeguard impacts and measures related to safeguard policies? Yes Have satisfactory implementation arrangements been agreed with the borrower and the same been adequately reflected in the project legal documents? Yes D. Approvals Signed and submitted by: Name Date Task Team Leader: Mr Walter Vergara 08/31/2009 Environmental Specialist: Ms Carla Della Maggiora 08/31/2009 Social Development Specialist Ms Maria E. Castro-Munoz 08/31/2009 Additional Environmental and/or Social Development Specialist(s): Approved by: Regional Safeguards Coordinator: Mr Reidar Kvam 09/02/2009 Comments: Sector Manager: Mr Aurelio Menendez 09/03/2009 Comments: