Document of The World Bank FOR OFFICIAL USE ONLY Report No: ICR00004393 IMPLEMENTATION COMPLETION AND RESULTS REPORT IDA Credit 4691-XK and IDA Grant H544-XK ON A CREDIT IN THE AMOUNT OF SDR 4.3 MILLION (US$ 6.74 MILLION EQUIVALENT) AND A GRANT IN THE AMOUNT OF SDR 3.5 MILLION (US$ 5.51 MILLION EQUIVALENT) TO THE Republic of Kosovo FOR THE REAL ESTATE CADASTRE AND REGISTRATION PROJECT (P101214) December 27, 2018 Social, Urban, Rural and Resilience Global Practice Europe And Central Asia Region CURRENCY EQUIVALENTS (Exchange Rate Effective June 30, 2018) Currency Unit = US$ SDR 0.869113 = US$ 1 US$ 1.1506 = SDR 1 FISCAL YEAR July 1 - June 30 Regional Vice President: Cyril E. Muller Country Director: Linda Van Gelder Senior Global Practice Director: Ede Jorge Ijjasz-Vasquez Practice Manager: Jorge A. Munoz Task Team Leader(s): Aanchal Anand, Kathrine M. Kelm ICR Main Contributor: Caleb Travis Johnson ABBREVIATIONS AND ACRONYMS BCC Building Cadastre Construction BETA Business Environment Technical Assistance Grant BP Business Plan CORN Continuous Operating Reference Network CPF Country Partnership Framework CR Cadastre Reconstruction CM Cadastre Map CZ Cadastral Zone DB Doing Business DRC Disaster Recovery Center EC European Commission ECA Europe and Central Asia Region EMP Environmental Management Plan EU European Union FYR Former Yugoslav Republic GCN Government Concept Note GNSS Global National Satellite System Government Government of Kosovo HPD Housing and Property Directorate ICR Implementation Completion and Results Report IDA International Development Agency IMCLA Inter-Ministerial Committee on Land Administration INSPIRE Infrastructure for Spatial Information in the European Community IO Intermediate Outcome IP Implementation Plan IPRR Integrated Property Registration Records IRR Internal Rate of Return ISN Interim Strategy Note IT Information Technology JICA Japan International Cooperation Agency KCA Kosovo Cadastre Agency KCDS Kosovo Cadastre Development Strategy KCLIS Kosovo Cadastre and Land Information System KEDS Kosovo Energy Distribution and Supply Company KOPOS Kosovo Continuous Operating Resource Network KPA Kosovo Property Agency KPCVA Kosovo Property Comparison and Verification Agency KTF Korea Peace and Conflict Trust Fund LA Legal Agreement M&E Monitoring and Evaluation MCO Municipal Cadastre Office MESP Ministry of Environment and Spatial Planning MTR Mid-Term Review NDS National Development Strategy NPV Net Present Value NSDI National Spatial Data Infrastructure OP Operational Policy PAC Public Awareness Campaign PAD Project Appraisal Document PCO Project Coordination Office PDO Project Development Objective PIU Project Implementation Unit POM Project Operations Manual PTK Post and Telecom of Kosovo QC Quality Control RECAP Real Estate Cadastre and Registration Project REGIP Real Estate Cadastre and Geospatial Infrastructure Project Sida Swedish International Development Cooperation Agency SK Statens Kartverk (Norwegian Mapping Authority) SME Small- and Medium-sized Enterprise SOA Service-Oriented Architecture SSP Comprehensive Proposal For the Kosovo Status Settlement TF Trust Fund UFGE Umbrella Facility for Gender Equality UN United Nations UNMIK United Nations Interim Administration Mission in Kosovo TABLE OF CONTENTS DATA SHEET .......................................................................................................................... 1 I. PROJECT CONTEXT AND DEVELOPMENT OBJECTIVES ....................................................... 5 A. CONTEXT AT APPRAISAL .........................................................................................................5 B. SIGNIFICANT CHANGES DURING IMPLEMENTATION (IF APPLICABLE) .......................................9 II. OUTCOME .................................................................................................................... 12 A. RELEVANCE OF PDO .............................................................................................................. 12 B. ACHIEVEMENT OF PDO (EFFICACY) ........................................................................................ 12 C. EFFICIENCY ........................................................................................................................... 18 D. JUSTIFICATION OF OVERALL OUTCOME RATING .................................................................... 19 E. OTHER OUTCOMES AND IMPACTS ......................................................................................... 19 III. KEY FACTORS THAT AFFECTED IMPLEMENTATION AND OUTCOME ................................ 22 A. KEY FACTORS DURING PREPARATION ................................................................................... 22 B. KEY FACTORS DURING IMPLEMENTATION ............................................................................. 22 IV. BANK PERFORMANCE, COMPLIANCE ISSUES, AND RISK TO DEVELOPMENT OUTCOME .. 23 A. QUALITY OF MONITORING AND EVALUATION (M&E) ............................................................ 23 B. ENVIRONMENTAL, SOCIAL, AND FIDUCIARY COMPLIANCE ..................................................... 25 C. BANK PERFORMANCE ........................................................................................................... 26 D. RISK TO DEVELOPMENT OUTCOME ....................................................................................... 27 V. LESSONS AND RECOMMENDATIONS ............................................................................. 28 ANNEX 1. RESULTS FRAMEWORK AND KEY OUTPUTS ........................................................... 30 ANNEX 2. BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION ......................... 41 ANNEX 3. PROJECT COST BY COMPONENT ........................................................................... 42 ANNEX 4. EFFICIENCY ANALYSIS ........................................................................................... 43 A. METHODOLOGY FOR ECONOMIC ANALYSIS........................................................................... 43 B. DIRECT RECAP BENEFITS (Used for NPV and IRR Calculations) ................................................ 44 C. INDIRECT RECAP BENEFITS (Not Used for NPV and IRR Calculations) ...................................... 45 ANNEX 5. SUMMARY OF BORROWER’S ICR .......................................................................... 46 ANNEX 6. SUPPORTING DOCUMENTS .................................................................................. 49 ANNEX 7. CONTINUITY BETWEEN RECAP AND REGIP ACTIVITIES .......................................... 50 The World Bank Real Estate Cadastre and Registration ( P101214 ) DATA SHEET BASIC INFORMATION Product Information Project ID Project Name P101214 Real Estate Cadastre and Registration Country Financing Instrument Kosovo Investment Project Financing Original EA Category Revised EA Category Partial Assessment (B) Partial Assessment (B) Organizations Borrower Implementing Agency Republic of Kosovo Kosovo Cadastre Agency Project Development Objective (PDO) Original PDO The project development objective is to help develop Kosovo's land and property markets and enhance security of tenure. Page 1 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) FINANCING Original Amount (US$) Revised Amount (US$) Actual Disbursed (US$) World Bank Financing 6,740,000 6,320,060 5,844,526 IDA-46910 5,510,000 5,492,458 4,983,642 IDA-H5440 Total 12,250,000 11,812,518 10,828,168 Non-World Bank Financing Borrower/Recipient 1,610,000 0 0 Total 1,610,000 0 0 Total Project Cost 13,860,000 11,812,517 10,828,168 KEY DATES Approval Effectiveness MTR Review Original Closing Actual Closing 04-Feb-2010 17-Jun-2011 28-Oct-2013 31-Jul-2015 30-Jun-2018 RESTRUCTURING AND/OR ADDITIONAL FINANCING Date(s) Amount Disbursed (US$M) Key Revisions 12-Jul-2015 6.24 Change in Loan Closing Date(s) 23-Dec-2015 7.08 Change in Results Framework Change in Components and Cost Reallocation between Disbursement Categories 23-Oct-2016 7.34 Change in Loan Closing Date(s) Reallocation between Disbursement Categories 27-Jun-2017 10.21 Change in Loan Closing Date(s) KEY RATINGS Outcome Bank Performance M&E Quality Satisfactory Moderately Satisfactory Substantial Page 2 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) RATINGS OF PROJECT PERFORMANCE IN ISRs Actual No. Date ISR Archived DO Rating IP Rating Disbursements (US$M) 01 07-Apr-2010 Satisfactory Satisfactory 0 02 17-Nov-2010 Satisfactory Moderately Satisfactory 0 Moderately 03 01-Mar-2011 Unsatisfactory 0 Unsatisfactory 04 30-Jul-2011 Satisfactory Satisfactory 0 05 07-Nov-2011 Satisfactory Satisfactory .05 06 27-May-2012 Satisfactory Moderately Satisfactory .24 07 17-Nov-2012 Satisfactory Satisfactory 1.21 08 05-Jun-2013 Satisfactory Moderately Satisfactory 1.62 09 03-Dec-2013 Satisfactory Satisfactory 3.37 10 28-Jun-2014 Moderately Satisfactory Satisfactory 3.95 11 11-Dec-2014 Moderately Satisfactory Satisfactory 4.71 12 17-Apr-2015 Moderately Satisfactory Satisfactory 6.24 13 19-Aug-2015 Moderately Satisfactory Satisfactory 6.39 14 01-Feb-2016 Satisfactory Satisfactory 7.22 15 13-Jul-2016 Satisfactory Satisfactory 7.34 16 13-Jan-2017 Satisfactory Satisfactory 9.72 17 25-Apr-2017 Satisfactory Satisfactory 9.84 18 08-Jul-2017 Satisfactory Satisfactory 10.21 19 10-Jan-2018 Satisfactory Satisfactory 10.78 20 29-Jun-2018 Satisfactory Satisfactory 10.78 Page 3 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) SECTORS AND THEMES Sectors Major Sector/Sector (%) Public Administration 100 Central Government (Central Agencies) 36 Sub-National Government 64 Themes Major Theme/ Theme (Level 2)/ Theme (Level 3) (%) Urban and Rural Development 0 Rural Development 100 Land Administration and Management 100 ADM STAFF Role At Approval At ICR Regional Vice President: Philippe H. Le Houerou Cyril E Muller Country Director: Jane Armitage Linda Van Gelder Senior Global Practice Director: Ranjit Nayak Ede Jorge Ijjasz-Vasquez Practice Manager: John V. Kellenberg Jorge A. Munoz Aanchal Anand, Kathrine M. Task Team Leader(s): Cora Melania Shaw Kelm ICR Contributing Author: Caleb Travis Johnson Page 4 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) I. PROJECT CONTEXT AND DEVELOPMENT OBJECTIVES A. CONTEXT AT APPRAISAL 1. Upon its declaration of independence on February 17, 2008, the Republic of Kosovo became the youngest country in Europe—both based on its new statehood and the average age of its population1— with all of the accompanying opportunities and challenges, including overcoming the legacies of a command economy, ethnic discrimination, and war.2 Furthermore, nascent independence contributed to the country’s weak investment climate due to political uncertainties and the lack of widespread land and property registration. In 2006, there were about 2 million land parcels, 600,000 buildings of all types,3 and an estimated 350,000 property owners.4 Government institutions lacked both the technical and human capacity to maintain land records and property rights transactions often went unregistered until there was a need for documentation for a procedure or a loan (and by then the registered owner may have moved, been displaced or was deceased).5 The decentralization process mandated by the United Nations’ (UN) Comprehensive Proposal For the Kosovo Status Settlement (SSP)6 delegated cadastre records to municipalities whose technical and human capacities were often weak to maintain them adequately. Although laws provided a basis for registering apartments, in practice they were not recorded in the automated Integrated Property Registration Records (IPRR) by the official registrars in the Municipal Cadastre Offices (MCOs).7 According the Bank’s DB Index, in 2012, Kosovo ranked 73rd under the “Registering Property” indicator. 2. The Government of Kosovo8 was acutely aware of the need to boost investment in the country as a means of spurring economic growth and, thus, was highly engaged and supportive of boosting the country’s property market and strengthening property rights. Simultaneously, the Government was aware of the lack of capacity of the institutions that would be responsible for overseeing the necessary changes. The Kosovo Cadastre Agency (KCA), which was established by UNMIK9 per Administrative Direction no. 2000/14 of June 7, 2000, lacked the technical and human capacity to carry out its duties. On top of this and as mandated by the SSP, the Government was required to begin a decentralization process in which Kosovo’s municipalities would assume responsibility for cadastral records as well as land use and development in accordance with applicable legislation. Thus, the MCOs would assume greater responsibility for property registration. However, both the KCA and MCOs lacked procedures for cooperation or any uniform standards for land and property registration, which caused confusion over their responsibilities and roles within the newly decentralized political environment. 3. In addition to Kosovo’s institutional deficiencies, its property market was constrained by the 1 According to the Kosovo Country Partnership Framework (CPF) of FY17 – FY21, the average age of Kosovo’s population is 26 years. 2 Ibid. 3 Types of buildings in Kosovo include commercial businesses, municipal buildings, state buildings and public buildings (Post and Telecom of Kosovo (PTK) buildings, Kosovo Energy Distribution and Supply Company (KEDS) buildings, municipal services, educational and health institutions and religious buildings). 4 Kosovo Real Estate Cadastre and Registration Project Appraisal Document (PAD). 5 Ibid. 6 Also commonly known as the Ahtisaari Plan. 7 Prior to project implementation, Kosovo’s cadastre only included land the building over the land (where there was only one owner for the building). Apartments were not registered in the MCOs or entered in the IPRR. 8 Both pre- and post-independence governments. 9 United Nations Interim Administration Mission in Kosovo. Page 5 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) effects of the 1999 conflict: (i) thousands of homes were damaged or destroyed and up to 75,000 properties were abandoned, land records were destroyed and others were removed to Serbia (to protect the rights of Kosovo’s displaced Serbs), where they remain today10; (ii) many citizens lost access to their properties11; (iii) ownership/possession records are incomplete or unreliable12; and (iv) vacated properties were occupied informally; about 20,000 claims on property with informal inhabitants were still being processed by the Housing and Property Directorate (HPD).13,14 4. The Real Estate Cadastre and Registration Project (RECAP) was designed to address Kosovo’s land sector challenges as described above. The Bank is, or has been, involved in financing cadastre and land administration projects in much of the Europe and Central Asia (ECA) region. Since the collapse of the Soviet Union and the rest of Eastern Europe’s communist bloc in 1991, over 40 land administration projects were completed in the region. Before the Bank-financed projects, most ECA countries did not have good land registers or cadastres, and the land administration sectors were operationally and institutionally fragmented and paper-based. Today, many of these countries operate fully digital systems for land and property registers and cadastres,15 and are moving to the next generation of services with geospatial data and electronic services as part of e-Government initiatives. Therefore, the Bank’s strong foundations and track record in ECA helped to gather the right experience for RECAP’s design. RECAP was also meant to build upon the progress achieved through the Bank’s Business Environment Technical Assistance Grant (BETA, P088045) that had an immovable property rights enhancement component.16 Moreover, RECAP was closely aligned to the Interim Strategy Note (ISN) of FY08 and that of FY10 – FY11.17 Specifically, RECAP supported ISN FY08’s Pillar 1, “Developing new sources and a higher quality of economic growth,” in which cadastre development was essential to its achievement. RECAP also contributed to Pillar 1 of ISN FY10 – FY11, “Accelerating growth that is broad-based and employment generating”; it did so via Main Area 3, “Promoting private sector development through support for agriculture, cadastre, and Small- and Medium-sized Enterprises (SMEs).” 10 Kosovo Real Estate Cadastre and Registration Project PAD. 11 Ibid. 12 Ibid. 13 Ibid. 14 This institution would undergo two name changes: first, the Kosovo Property Agency (KPA) and then the Kosovo Property Comparison and Verification Agency (KPCVA), which is still its name at the time of writing this ICR. 15 In Doing Business 2018, six ECA countries (Lithuania, Georgia, Belarus, Estonia, Slovak Republic, and Kyrgyz Republic) were ranked in the top 10 countries on Registering Property. 16 See ICR00002405 for a full description of the progress achieved in immovable property rights under BETA: https://hubs.worldbank.org/docs/ImageBank/Pages/DocProfile.aspx?nodeid=18028682. 17 ISN FY08 was active during RECAP’s appraisal while FY10 – FY11 was active by the time of RECAP’s Board Approval. Page 6 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Theory of Change (Results Chain) Project Development Objectives (PDOs) 5. The original PDO in the Financing Agreement reads “to help develop Kosovo’s land and property markets and to improve tenure security.”18 18 The Financing and Legal Agreements as well as the PAD have identical PDO wording. Page 7 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Key Expected Outcomes and Outcome Indicators ▪ A percentage increase in the number of transactions registered (10 percent); ▪ Reduction of the average number of days to register the sale of a residential property (from 30 days to 10 days); and ▪ An increase in the percentage of the population in target areas with registered rights from 30 percent to 80 percent.19 Components ▪ Component A: Municipal Land Administration (initial allocation of US$ 7.38 million20). The objective of this component was to support the improvement of MCO capacity to deliver services through the financing the following sub-component activities: o Sub-Component A1: Detailed design and rehabilitation of the MCOs. This sub-component intended to finance the reengineering of up to 20 MCOs by funding building renovations, furniture, equipment and archives. The goal was to improve client services and apply new front/back office layouts and standardized procedures in order to make transactions more systematic, efficient and transparent. o Sub-Component A2: Systematic registration. This sub-component supported systematic updating of cadastral information (“cadastral reconstruction” (CR)) in the MCOs by integrating systematic registration data into the Kosovo Cadastre and Land Information system (KCLIS) after KCA approved the quality of the data. ▪ Component B: KCA Institutional Framework (initial allocation of US$ 1.69 million). The objective of this component was to support the KCA’s institutional reform and the upgrading of its technical infrastructure. It was rolled out through the following sub-components: o Sub-Component B1: Institutional Reform. This sub-component supported the KCA’s overall reform, based on the Kosovo Cadastre Development Strategy (KCDS), Business Plan (BP) and Implementation Plan (IP). The legal and normative framework were upgraded in several aspects: legislation and operational manuals for front/back office operations, Building Cadastre Construction (BCC), Cadastral Reconstruction (CR), Quality Control (QC) and strategies for Information Technology (IT) and National Spatial Data Infrastructure (NSDI). o Sub-Component B2: KCA Technical Infrastructure. This sub-component financed the establishment and maintenance of a Continuous Operating Reference Network (CORN)21 to provide a single source of reference points to surveyors as well as support a KCA Hotline for MCOs and clients for queries and have an authoritative source of information on legal and technical questions.22 19 As will be explained in Section B below, the Intermediate Outcome (IO) Indicators for “Reduction of the average number of days to register the sale of a residential property” and “An increase in the percentage of the population in target areas with registered rights” were later upgraded to PDO indicators as a means of better measuring the Outcome Targets. 20 As described in the PAD, the cost per component as described in this section adds up to a total of US$ 11.68 million after decimal points are rounded to the nearest hundredth. The remaining US$ 2.18 million were allocated for physical (US$ 1.17 million) and price (US$ 1.01 million) contingencies. 21 Kosovo Positioning System or KOPOS. 22 It was later determined that a hotline was not cost-effective and was subsequently substituted with other forms of communication, such as the KCA webpage and contact email. Citizens can also call both KCA and the MCOs, whose phone numbers are listed on the KCA webpage, during working hours. Page 8 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ▪ Component C: Project Management, Training and Public Outreach (initial allocation of US$ 2.62 million). The objective of this component was to support the KCA in managing the project, monitor and evaluate the project’s effectiveness, and build its management and other skills. The component financed the following activities: o Sub-Component C1: Project Management and Donor Coordination. This sub-component financed the strengthening of the KCA’s Project Coordination Office (PCO) to ensure project due diligence in procurement and financial management, monitor and evaluate the project’s progress, coordinate donor inputs, report to the Government and donors and organize events. Additionally, and as part of credit effectiveness, it was ensured that the PCO’s staff included a coordinator, a financial management specialist, a local procurement specialist, a legal specialist and a cadastre specialist. Furthermore, a Financial Management Manual was prepared as part of the Project Operations Manual (POM). o Sub-Component C2: Training. This sub-component supported the design and implementation of a comprehensive training program for KCA and MCO managers and staff, the PCO, private surveyors and other key stakeholders in management, planning, legal, technical and administrative subprojects. o Sub-Component C3: Public Outreach. Activities under this sub-component included social assessments, customer satisfaction surveys, and public awareness campaigns to improve outcomes of CR and strengthen women’s property rights. B. SIGNIFICANT CHANGES DURING IMPLEMENTATION (IF APPLICABLE) Revised PDOs and Outcome Targets 6. Neither the PDO nor the Outcome Targets were revised during the life of the project. Revised PDO Indicators 7. Two of the project’s Intermediate Outcome (IO) Indicators were elevated to PDO Indicators as the sole original PDO Indicator, “Increase in the Number of Transactions,” was found to be far too dependent on the overall economic performance of the country and, therefore, did not adequately reflect the project’s activities. Thus, “Number of Days to Complete a Transaction” and “Target Population with Use or Ownership Rights Recorded as a Result of the Project” were elevated from IO to PDO indicators under the Level 2 Restructuring of December 2015. This revision helped to better reflect the PDO target outcomes, as the sole original PDO indicator could not possibly have measured said Outcomes.23 Revised Components 8. None of the Components were revised during the life of the project. Other Changes 9. As requested during RECAP’s mid-term review in October/November 2013, four IO indicators 23 This ICR will not apply a split rating method, as the project’s scope and level of ambition virtually remained the same throu ghout its lifespan. The elevation of two IO indicators, whose end targets remained the same, were a means of better capturing all of the target outcomes. Thus, a split rating is not necessary for RECAP’s assessment. Page 9 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) were added to the results framework: (i) “Target population with use or ownership rights recorded as a result of the project,” which, as noted above, was later elevated to a PDO indicator; (ii) “Target land area with use or ownership rights recorded as a result of the project”; (iii) “Land parcels with use or ownership rights recorded as a result of the project”; and (iv) “Land parcels with female use/ownership rights recorded as a result of the project.” These IO indicators were core indicators introduced by the Bank that were to be tracked under all of its land projects. A restructuring request was not submitted when these IO indicators were added to RECAP’s Results Framework. 10. Under the Level 2 Restructuring of December 2015, two new IO indicators were added in order to build upon the project’s IT achievements up to that date and to take them further. The “Creation of a Digital Archive” IO was added as a natural next step after the project had already contributed to the establishment of a fully integrated IT system across the KCA and MCOs. Creating a digital archive ensured that all data was digitally scanned and accessible in the system, thus ensuring the security of tenure even in the case of any natural disasters and would tie in well with KCA’s Disaster Recovery Plan. Another IO indicator was created for the development of Kosovo’s NSDI. RECAP supported KCA’s progress on implementing the European Union (EU) INSPIRE Directive related to NSDI. These IO indicators were added during the Level 2 Restructuring of December 2015, which also revised the target dates in the Results Framework from July 31, 2015 to January 31, 2017. 11. Additionally, the baseline for gender disaggregated property ownership data was rationalized under the Level 2 Restructuring of December 2015, as the original baseline was overestimated two-fold: the baseline for women’s property ownership was reported as 30 percent in the PAD and the goal was to try to increase it by 10 percent (not to be confused with percentage points) from 30 percent to 33 percent. In 2014, with the continued rollout of KCLIS and a special, Bank-funded gender disaggregated data activity, the team was able to generate more accurate and real-time gender disaggregated and property ownership data, which clarified that the baseline was significantly overestimated. Thus, the baseline was lowered to 12 percent. 12. Two changes in disbursement estimates of the project occurred: ▪ The Level 2 Restructuring of December 2015 created disbursement Category 4 (Works and Technical Services for Parts A.1, A.2(a) and A.2(c) of the Project). For IDA-46910, Category 4 (75 percent financed) merged all works and technical services from Categories 1 and 2 (both 75 percent financed); for IDA-H5440, the Restructuring allowed the transfer of €2.05 million of grant proceeds from Category 3 (100 financed) to Category 4 (100 percent financed). ▪ The Level 2 Restructuring of October 2016 created a new IDA-46910 expenditure called “IS-Technical Services for Part B,” with US$ 296,000 reallocated from Category 4. During the Level 2 Restructuring of December 2015, the official Government request mistakenly left out technical services for Component B from the new cost category. This Restructuring was required to include technical services in the expenditure category for grant funding by the Bank’s finance and disbursement terms. Two other reallocations occurred: (i) the reallocation of just over US$ 1.0 million from IDA-46910 Category 4 to Category 3; and (ii) the reallocation of just over US$ 542,000 from IDA-H440 Category 3 to Category 4. Page 10 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) 13. The project’s closing date was also extended three times: ▪ Level 2 Restructuring, July 2015: First extension of IDA-H440 and only extension for IDA-46910 for an 18-month period (from July 31, 2015 to January 31, 2017) to support institutional strengthening and sustainability of the KCA and to complete systematic registration. ▪ Level 2 Restructuring, October 2016: Second extension of IDA-H5440 for a 5-month period (January 31, 2017 to June 30, 2017) to test and ensure system operability and sustainability of key IT systems and geospatial data infrastructure and to have sufficient time to draft the new Integrated Cadastre Law as part of efforts to ensure the institutional sustainability of KCA. ▪ Level 2 Restructuring, June 2017: Third extension of IDA-H5440 for a 12-month period (June 30, 2017 to June 30, 2018) to: (i) maintain engagement on the drafting of the new Integrated Cadastre Law; and (ii) implement the then-ongoing IT system upgrade that allowed KCA to improve service delivery to citizens, government agencies and the private sector. While these activities continued, the Bank team also used the time to begin scoping out the activities of a new project that would build upon RECAP’s achievements.24 Rationale for Changes and Their Implication on the Original Theory of Change 14. The changes described above were necessary to achieve the outcomes as illustrated in the Theory of Change (see page 7). Due to the 18-month delay in RECAP’s effectiveness as described below, the extensions were necessary in order to complete all activities and outputs that were essential to ensuring proper implementation and finalizing the necessary upgrades to the KCA’s IT systems25, thereby strengthening Kosovo’s land administration system. Furthermore, the extensions allowed for more time to maintain engagement and discussions on both the Government’s Concept Note on Cadastre (GCN) and the draft Integrated Cadastre Law, which as described in Section II.B below, helped to lay the foundations of and define what changes to the country’s existing legislation are needed to ensure KCA’s institutional sustainability. Furthermore, the elevation of “Number of Days to Complete a Transaction” and “Target Population with Use or Ownership Rights Recorded as a Result of the Project” were essential to mitigating the PDO’s dependence on external market forces that were not linked to the project’s activities. The addition of more IO Indicators also helped to better capture the outcomes and outputs produced by RECAP and contributed to strengthening the original Results Framework so that it could appropriate track the achievements of the project. Thus, the implication of the changes on the original Theory of Change was highly beneficial to RECAP’s success. 24 The Real Estate Cadastre and Geospatial Infrastructure Project (REGIP; P164555) is under preparation and is scheduled for Board Delivery on December 18, 2018. 25 These upgrades were instrumental to preparing KCA to start developing e-services, which will be under the scope of the follow-on REGIP Project. Page 11 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) II. OUTCOME A. RELEVANCE OF PDO Assessment of Relevance of PDO and Rating 15. The original PDO remained highly relevant at completion. The project was implemented via an IDA credit and an IDA grant that covered eight years and four iterations of the Bank’s engagement strategy in Kosovo. During this period, the role of improving land and property markets remained integral to business development and investment in the country. Sound formulation of the PDO at appraisal and the implementation of necessary adjustments to the PDO indicators due to external market forces and the economic downturn as a result of the Global Financial Crisis during implementation allowed the project objectives to be tracked more appropriately. 16. At completion, the project objectives were well aligned with the Country Partnership Framework (CPF) for FY17 – FY21. The CPF was endorsed by the Board of Directors in April 2017 and aligns with the priorities of the Government’s National Development Strategy (NDS) for 2016-202126 and the 2016 Economic Reform Program that most effectively contributed to eradicating extreme poverty and improving shared prosperity. The project significantly contributed to the following Focus Area of the CPF: ▪ Focus Area 1 – Enhancing Conditions for Accelerated Private Sector Growth and Employment o Objective 1: Improve the business environment and access to finance ▪ Indicator 5: Number of properties updated and validated in the digital cadastre (Kosovo Cadastre Land Information system) 17. The project outcomes at closing remained highly relevant to CPF objectives. The cadastral reconstruction in 30 percent of priority cadastral zones (CZs) helped to ensure and clarify ownership of land parcels. Moreover, the development of Kosovo’s Geoportal helped to consolidate information on land and property ownership into one webpage that is accessible to the general public, thereby helping to improve access to data for citizens interested in purchasing or selling land and property for future business needs. Furthermore, the ability to obtain credit by using land as an asset directly contributed to Indicator 5 of Focus Area 1. The Bank plans to keep building upon the success of RECAP and further contribute to achieving Objective 1 of Focus Area 1 via Indicator 5 through the planned Real Estate Cadastre and Geospatial Infrastructure Project (REGIP, P164555). Assessment of Relevance of PDO and Rating: HIGH B. ACHIEVEMENT OF PDO (EFFICACY) Assessment of Achievement of Each Objective/Outcome 18. The PDO can be broken down into two objectives: (i) helping to develop land and property markets; and (ii) improving tenure security. Evidence for the achievement of the PDO indicators that were linked to these objectives is presented below, complemented by the results for the IO indicators and additional supporting information. 26The four thematic pillars of the NDS are: (i) human capital; (ii) good governance and rule of law; (iii) development of competitive industries; and (iv) development of infrastructure. Page 12 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Objective 1 – Helping to develop land and property markets 19. RECAP achieved this objective through its activities under Component A: Municipal Land Administration and Component B: KCA Institutional Framework. It helped to establish the rules of the game for formally registering and recording property by providing standardized procedures at the MCOs as well as streamlining customer service processes in order to make transactions more systematic, efficient and transparent. Furthermore, the CR and BCC activities in priority cadastral zones developed the necessary documentation for land and property owners, which would help them to obtain bank loans and formally engage businesses seeking to invest in Kosovo. Overall, and as detailed below, land and property transactions increased despite external factors. RECAP’s monitoring of the increased number of transactions registered in KCLIS served as a proxy for concrete effects of the project in Kosovo’s land and property market despite the limitations of using this type of PDO indicator.27 Evidence for the achievement of Objective 1 is described below. 20. Improved Coverage and Efficiency of Cadastral Services. RECAP envisaged the reengineering of at least 20 out of 38 MCOs as a means of achieving greater procedural efficiencies, better working environments for staff, improved transparency and easier access to services for customers. Reengineering consisted of improving workflows such as the implementation of the front/back office model28, working conditions and record storage as a means of improving client services. In all, RECAP helped to reengineer 23 offices, 22 MCOs and KCA’s central office in Prishtina, thus exceeding the original target by 3 offices. An additional 6 offices were supplied with furniture and IT equipment as part of an agreement with the European Commission (EC), which was in the process of successfully completing their reengineering. This activity was important to achieving Objective 1 not only because of improved office capacity for registering land and property transactions, but because as part of reengineering, MCOs were obliged to sign a Memorandum of Understanding (MoU) in which they agreed to abide by a set of standardized procedures for property registration. This MoU helped to provide customers with a set of consistent, uniform cadastral services across the reengineered MCOs, thereby helping to resolve one of the issues facing the MCOs as they assumed greater responsibility for property registration. 21. Reengineering and the development of standardized procedures for cadastral services directly contributed to a drop in the average number of days to complete the recording of the purchase or sale of property in Kosovo’s land administration system in both urban and rural areas. The final result, 9.84 days, exceeded the original 10-day target, and is a drop from a baseline of 30 days at the beginning of RECAP. The improvement of Kosovo’s Doing Business (DB) ranking for Registering Property from 73 rd place in DB 2012 to 34th place in DB 2018 is an illustration of the positive spillover effects of RECAP in Kosovo’s business environment. 22. Cadastre Reconstruction for 30 percent of priority CZs, or areas where economic activity is highest in Kosovo, was completed under RECAP, which helped to provide formalized and up-to-date documentation for land and property owners. Out of the total 159 priority CZs, 116 were directly financed by RECAP29 while others benefitted from the development of guidelines and manuals that will provide 27 See Section IV.A: M&E Design. 28 This achieved the “in use” target of the “Operations manuals for MCOs: back office/front office” IO indicator. 29 RECAP built upon the CR activities of BETA, through which 25 CZs in 5 municipalities were reconstructed. Page 13 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) procedural and policy guidance for future CR activities. Approximately 330,000 parcels and a population of 300,000 inhabitants benefitted from CR.30 Improvements to the CR manuals were provided throughout the project lifecycle, including quality assessments and quality control recommendations from the Bank, an international quality control consultant and contractors who worked with KCA. Quality control improvements rose exponentially upon the issuance of the guidelines, with the number of critical errors falling from 155 percent in the first batch of cases (92 critical errors in 80 cases) to 30 percent in the most recent batch (12 critical errors in 40 cases). 23. Additionally, as part of its BCC activities, RECAP supported the collection of complete documentation for recording of all collective buildings in urban areas of cities, commercial businesses, municipal buildings, state buildings and public buildings in 30 cities nationwide, including Prishtina. Data was collected for 3,040 buildings and 41,500 building sections for a population of around 480,000 inhabitants. BCC was important, particularly in the real estate market, as it allowed for increased property transactions and for improved opportunities for businesses, which now have more stability and appropriate documentation, to further invest in their land and properties. 24. Overall, the process of CR and BCC recorded 300,000 use or ownership rights during RECAP, exceeding the original PDO indicator end target of 180,000. Most of these use or ownership rights are for properties within completed CZs where there is the highest potential for business investment, thus further contributing to the stated objective of helping to develop land and property markets. Additionally, the project achieved its goal of ensuring that CR, BCC and quality control manuals are now in use for future operations. 25. Increased Number of Transactions Registered. Land and property transactions throughout RECAP did increase, but it should be noted that said transactions were closely linked to macroeconomic factors that affected Kosovo during the life of the project. RECAP could not affect conditions such as the Global Financial Crisis’s negative impacts on Kosovo’s economy. Subsequently, the performance of RECAP’s “Number of transactions registered by 10 percent per year” fluctuated over time, with overachievement in some years and underachievement in other years. On a cumulative basis, however, RECAP overachieved its original target. For example, the cumulative target of the indicator up to 2017 was 260,897 transactions whereas the project recorded 320,167 transactions, i.e. 23 percent over the cumulative target. Taking into account the final year target of 53,590 transactions, the cumulative final target over the project period is 314,487 transactions. Comparing 314,487 transactions (final cumulative target) to 351,441 (final cumulative estimated achievement), the project records an estimated 12 percent overachievement of the cumulative target. It is also important to note that despite the difficulties with this PDO indicator, the coverage and efficiency of cadastral services have improved throughout the project, which supported land market functions in Kosovo. Objective 2 – Improving Tenure Security 26. The activities of Component B: KCA Institutional Framework and Component C: Project Management, Training and Public Outreach were instrumental to improving tenure security in Kosovo. As noted in the Theory of Change, RECAP’s compiling, revising and dissemination of laws related to property rights and administration to target audiences helped to clarify uncertainties and misinterpretations of the 30 Borrower’s ICR. Page 14 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) existing legislation by key stakeholders involved in land and property registration. Furthermore, the development of KCA’s IT and Geospatial Infrastructure helped improve tenure security by helping to ensure that all cadastral information was up-to-date by digitizing all paper-based cadastral documents at the MCOs and the subsequent development of a digital archive whose information was backed up at a disaster recovery center (DRC) in the event of a disruption of KCA’s IT systems. 27. Institutional Reform. RECAP’s support to the discussions and development of documents regarding KCA’s institutional sustainability helped to lay the foundations for the Agency’s institutional reform, which contributed to Objective 2 by defining what a self-sustaining, central land administration agency in Kosovo would look like. The long-term sustainable development of Kosovo’s land administration system was a key topic of discussion throughout RECAP and was also a key reason for the three extensions of the project’s closing date. The institutional reform of KCA was a major topic of discussion in particular; reforms would focus on its financial sustainability and its structure as a unified cadastral and registration institution. In order to help achieve these reforms, RECAP provided support to KCA in elaborating the following documents: the Government’s Concept Note (GCN) on Cadastre, a financial analysis, a legal review and proposal for a new organization structure of the KCA and MCOs, as well as a strategy and business plan. The GCN, which was later approved by the Ministry of Environment and Spatial Planning (MESP), was then used as the basis for discussion regarding a new Integrated Cadastre Law that aims to enhance KCA sustainability by: (i) addressing the issue of vertical organization for cadastral services under KCA instead of under municipalities; and (ii) proposing a (partial) self-financing or revenue sharing structure to allow for the maintenance of KCA IT and geospatial systems. Under REGIP, the Bank will continue to support KCA by helping to update the documents as needed in order to continue to build the case for the enactment of legislation to ensure KCA’s institutional sustainability. 28. Kosovo IT and Geospatial Infrastructure. IT development financing was a major contributor to the achievement of RECAP’s PDO.31 The massive scanning and digitization of the paper archival cadastral documents at the MCOs and their subsequent integration into KCLIS provided a digital back-up of all paper-based documentation and helped to achieve the “Creation of Digital Archive” IO indicator. It also helped to preserve cadastral records in order to prevent any losses or damage to paper-based documentation. Furthermore, the upgrades and enhancements of KCLIS and the rollout and subsequent operationalization of KCLIS-CM in 35 MCOs32 have helped both the KCA and MCOs better track cadastral information, including records and transactions, throughout Kosovo. Furthermore, upgrades towards service-oriented architecture (KCLIS-SOA) has contributed to the ability for KCLIS to become interoperable with other registers such as Civil Register, Address Register, etc. The investments towards interoperability are planned under REGIP and were made possible by the SOA upgrade. The interoperability of KCLIS-SOA will allow KCA and MCOs as well as other Government institutions and agencies to share and obtain information to promote informed decision-making for issues and opportunities that may arise in the land and property sectors in the future. 29. Additionally, RECAP financed the extension and upgrading of IT infrastructure primary (KCA) and 31 IT development under RECAP was closely coordinated with Norway’s Statens Kartverk (Norwegian Mapping Agency; SK). Norwegian s upport will continue until 2020. 32 This accounts for all of the MCOs in Kosovo with the exception of the three Northern Municipalities of Leposaviq, Zubin Potok and Zvecan that, due to political circumstances, did not undergo MCO reengineering and did not participate in RECAP activities despite multiple outreach attempts by the Bank. However, KCA does provide KCLIS services on an on-demand basis for interested property owners and citizens of these municipalities. Page 15 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) secondary (DRC). The new backup and DRC is operational and for the purposes of high-level operational safety, it will minimize the disruption of KCA IT operations and ensure that KCA organizational stability and an orderly recovery in the event of a disaster.33 This is important to RECAP’s achievement of Objective 2, as cadastral information was now backed-up and would remain up-to-date in the event of a systems failure at KCA. 30. Before RECAP’s implementation, KCA had one static webpage with very limited information and without any channel of communication. Through RECAP financing, the webpage was updated in 2011 and now has dedicated pages for frequently asked questions on how to register one’s property, gender and property, access to public documents, and multimedia. Similarly, private surveyors and surveying companies can also download template requests for licensing, etc. The webpage is also available in three languages—Albanian, Serbian and English—and can be visited through the following link: www.kca- ks.org. Since 2011, the webpage has engaged 100,000 active users worldwide.34 The updating of the webpage was important to achieving Objective 2 because it helps to consolidate legislation and information into one webpage to help citizens be better informed about their rights to land and property. 31. The development of Kosovo CORN (KOPOS) was an important activity that significantly sped up surveying work with respect to CR.35 By the end of RECAP, there were 159 licensed private surveyors using KOPOS, far exceeding the original target of 30, which was important because it indicates that the surveyors are actually utilizing newer technologies in Kosovo as part of their work. These newer technologies such as the 8 Global Navigation Satellite System (GNSS) reference stations and the control computation center at the KCA central office, both of which negated the need to maintain costly trigonometric stone pillars and thousands of additional markers across the country. Furthermore, agreements were reached with FYR Macedonia and Montenegro for the shared use of their CORNs.36,37 This benefitted Kosovo because enhanced data sharing helps countries to improve the accuracy of territorial borders as well as enhance cooperation in the event of natural hazards with regional implications that are not always country-specific.38 32. RECAP’s public awareness activities also contributed to improved data access through the KCA- administered National Geoportal39, which contains almost 60 different datasets, all of which are free to search and view. While most data are from the KCA, other providers include MESP, the Ministry of Agriculture, the Agency of Statistics of Kosovo and the Municipality of Prishtina. Out of the 60 datasets, the most visited one is that for cadastral parcels. Development of the Geoportal remains in its early stages but it remains important because the use of its datasets has the potential to benefit Kosovo’s public and private sectors by reducing the time and cost of decision-making while also improving the quality of these 33 DRC site renovation, facilities and necessary infrastructure (fire protection, controlled user access, a cooling system, power generator, etc.) were financed by the EU. 34 Borrower’s ICR. 35 Final Aide Memoire, June 2018. 36 Ibid. 37 Other NSDI activities were simultaneously occurring during RECAP’s lifespan, such as those of the ongoing IMPLUS project that is financed by the Swedish International Development Agency (Sida). The project aims to support agencies in the implementation of the INSPIRE Directive, providing technical interoperability, and the exchange and sharing of geospatial data at the national and regional level. The KCA will be responsible for harmonization, services and metadata for: (i) administrative units; (ii) elevation; (iii) geographical names; and (iv) orthoimagery. The IMPULS project ends in June 2019. 38 Newsletter: UN-GGIM – Global Geodetic Reference Frame Working Group, February 2016. 39 The Geoportal was initially developed with SK funding and a link to it can be found here: http://geoportal.rks-gov.net/en/filimi. Page 16 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) decisions. It is planned under REGIP to improve the quality of the Geoportal’s datasets by improving their accuracy and completing the information they contain. 33. Training. Training was a major component that contributed to KCA’s capacity building as an effective land administration agency as well as the MCOs’ capability to manage new procedures for cadastral services and management of cadastral documentation. Integrated Training Plans40 for all donor- funded activities were drafted annually and were based on the requests and needs of KCA, MCO and PCO staff in order to help them understand how to use new procedures for property registration as well as the new IT systems that were being developed and rolled out across the municipalities. Between 2012 and 2017, 46 trainings were organized for the benefit of 810 participants.41 The outcome of the trainings was increased technical knowledge in KCA and the MCOs. Improved job training helped to resolve the lack of human capacity within Kosovo’s land administration system and contributed to Objective 2 by increasing the competency levels of management and staff who were directly involved in overseeing land and property records, registration and transactions as well as the affiliated policies and procedures. 34. Public Outreach. Public awareness campaigns (PACs) were crucial to CR and BCC activities during RECAP, as well as the formal documentation that was produced during their implementation. Because CR was an activity that relied upon the voluntary participation of property owners, it was important to have PACs as a means of raising awareness and increasing participation in the process. If owners did not participate, then CR did not occur. Thus, it was important to actively engage citizens as a means of actually being able to reconstruct cadastral data and formalize property ownership within official cadastral records. Additionally, the PACs were an important tool for raising awareness of women’s rights to property based on Kosovo’s legal framework. For example, PACs helped to explain the importance of jointly registering titles in the names of both spouses as a means of securing inheritance for children, which helped to increase titling for women. 35. Furthermore, and as a means of tailoring their engagement to the general public to help incentivize the use of cadastral services as well as help to define strategies to help citizens understand their legal rights to land and property ownership, three customer surveys were completed under RECAP that targeted multiple communities, including women and ethnic minorities such as Serbs and smaller communities such as Bosnians, Turks and Roma.42 These customer surveys helped to generate a positive public perception of cadastral services within Kosovo; by the time of RECAP’s closing, 81 percent of participants in the latest customer survey were satisfied, which exceeds the original target of 53 percent. KCA also set up both a “contact us” email on its webpage and a Facebook page as a means of utilizing all channels of communication to answer questions regarding citizens’ rights to property.43 Consequently, the PACs and continued citizen engagement have been helpful to increasing public knowledge of cadastral services provided by KCA and the MCOs. This is important to improving tenure security because a lack of citizen participation means that there would have been fewer CR activities as well as fewer incentives to visit MCOs for formal land transactions and property registration. 40 The Training Plan was integrated across all donors to maximize capacity building efforts while minimizing duplication. Topics of the trainings included gender sensitization in property rights, cadastre work (CR and BCC) and management (project management, IT management and contract management), among others. 41 Borrower’s ICR. 42 As of the customer survey of 2016. 43 The number of people who have “liked” the Facebook page averages at about 2,000, with about 20 percent being women. Page 17 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) 36. Donor and Inter-Ministerial Coordination. As a means of responsibly managing the numerous donor operations44 that were simultaneously occurring in the land sector during RECAP’s implementation, KCA set up a donor coordination committee. This donor coordination committee acted as an advisor to the Inter-Ministerial Committee on Land Administration (IMCLA) that was established in 2009 by a Government Direction. IMCLA consists of many Government ministries and agencies, including KCA, KPCVA, MESP, the Ministry of Finance and the Ministry of Public Administration, among others. The IMCLA meetings occurred twice a year and facilitated broader strategic dialogue on land and geospatial issues in Kosovo as well as provide KCA a platform to share project developments and results and seek support on important matters within the land sector. The donor coordination and IMCLA meetings contributed to clear communication between donors and helped to avoid duplications and overlaps in the various donor- funded project activities. This allowed RECAP to build upon the achievements of separate donor projects, such as SK’s work on the National Geoportal, thereby further contributing to the development of Kosovo’s geospatial infrastructure, whose benefits to Objective 2 are described above. This inter-donor and IMCLA collaboration and communication is planned to continue under REGIP. Justification of Overall Efficacy Rating 37. The overall efficacy rating is considered Substantial. As explained above, the PDO outcomes were achieved and most of the activities that were implemented and outputs produced were completed. Nevertheless, the KCA’s ongoing institutional reform efforts were not completed under RECAP, despite it being a key reason for three extensions of the project’s closing date. It is envisaged that REGIP will continue engagement on KCA’s institutional reform as well as build upon the other PDO achievements.45 Assessment of Efficacy of PDO and Rating: SUBSTANTIAL C. EFFICIENCY Assessment of Efficiency and Rating 38. The PAD’s economic analysis had certain limitations in its forecasts, such as using optimistic assumptions for forecasts and not taking into account more direct benefits coming from project activities such as CR and BCC, which, as noted above, contributed to the achievement of the PDO. Thus, the PAD economic analysis is not replicated for this ICR’s efficiency analysis. Instead, the ICR efficiency analysis is based on direct benefits discussed in Annex 4. 39. The ICR efficiency analysis and the calculations of net present value (NPV) and internal rate of return (IRR) are based on three direct benefits: (i) immediate costs savings to citizens from CR; (ii) immediate cost savings to citizens, businesses and government (local/national) from BCC; and (iii) productivity gains from the digital archive. Furthermore, additional economic benefits are mentioned though they are not used in the NPV and IRR calculations, as they are difficult to quantify or attribute entirely to the project. 40. Based on the above three channels of benefits, a high discount rate of 25 percent46 and project 44 Donors who were implementing projects during RECAP included SK, Sida, the EU and the Japan International Cooperation Agency (JICA). 45 See Annex 7 for a summary of continuity between the achievements of RECAP and the planned activities and components of REGIP. 46 Due to the fact that the ICR could not replicate the Economic Analysis presented in the PAD, the ICR analysis applies a discount rate of 25%, Page 18 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) period of 2011 to 2018, the project NPV is calculated at €6.18 million (approximately US$ 5.15 million) and the IRR is estimated at 40.92 percent. Since the NPV is greater than zero and the IRR comfortably exceeds the discount rate of 25 percent, the project efficiency is rated as Substantial. Assessment of Efficiency of PDO and Rating: SUBSTANTIAL D. JUSTIFICATION OF OVERALL OUTCOME RATING 41. Based on the Relevance (High), Efficacy (Substantial), and Efficiency (Substantial) ratings, RECAP’s overall outcome rating is considered Satisfactory. The achievement of project outcomes is well documented and sound adjustments during implementation contributed to satisfactory performance. Furthermore, excellent donor coordination contributed to many unintended, yet positive, outcomes that are described in Section E below. The elevation of two IO indicators to PDO indicators to allow the Results Framework to better capture all of the PDO’s target outcomes and cushion the effects of macroeconomic fluctuations on RECAP was also a contributing factor to the project’s overall success. Furthermore, the spillover effects of RECAP into Kosovo’s business environment has also contributed to the Government’s overall development priorities.47 E. OTHER OUTCOMES AND IMPACTS Gender 42. RECAP sought to address gender gaps in property ownership but faced a number of challenges along the way. At the beginning of the project, it was estimated that roughly 30 percent of property owners were women. However, through the use of TFs, better data was collected and the IT system was revamped to produce gender-disaggregated data that indicated that 30 percent was grossly overestimated. Based on the new data, a new baseline was established indicating a property ownership rate of 12 percent for women. There were several public awareness campaigns and market-based policy interventions that sought to increase the levels of female property ownership, including a joint initiative in which the KCA and the Agency for Gender Equality working together to register marital property in the names of both spouses free-of-charge for a targeted period of time. Despite these efforts, only 16.8 percent of properties listed in KCLIS were either wholly or jointly owned by women by the time RECAP closed. One of the main causes of this is the existing societal norm in which men are considered the head of household and family assets. Many women either do not know their rights or remain pressured by their families to register property they may have inherited under the name of a male relative. 43. In an effort to address the shortcomings in women’s property ownership, RECAP, using funding from the Korea Peace and Conflict Trust Fund (KTF), conducted a randomized control trial to test the effectiveness of messaging on women’s property rights during CR found that men were more open to jointly registering with their spouses when the discussion centered around benefits to the children rather than the economic security of the wife alone. Such customized messaging may be able to boost women’s property ownership given the social norms in Kosovo. A big achievement of RECAP was the commitment with which the KCA began approaching the issue of gender-sensitivity in the field of property rights. The KCA now applies a gender lens to all activities, including tracking the percentage of women that engage twice that of the PAD economic analysis (12.5%). This was done, among other things, to be highly conservative with respect to the ICR Efficiency Analysis. For details, please see Annex 4. 47 See Section II.A for more information. Page 19 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) with the KCA on the Agency’s Facebook page. 44. Additionally, RECAP was supported by the Umbrella Facility for Gender Equality (UFGE) TF that provided funding to work with “war widow” in villages whose husbands, sons and other male relatives were killed or disappeared during the 1999 conflict. Consequently, many women lacked property titles and thus were unable to obtain bank loans that were needed to expand their businesses. Using technologies such as drone imagery for basemaps and GeoODK for collecting spatial data, the Bank team worked with the women to determine where the registered owners of their properties were located or if they were deceased. New titles were created under the names of living relatives. However, very few of the war widows opted to register their properties under their own names and typically chose living male relatives instead. Institutional Strengthening 45. Institutional Capacity and Sustainability. Over the course of RECAP, KCA’s institutional capacity increased significantly. At the time of project preparation, only basic IT investments in the KCA were envisaged. The KCA, however, outperformed the initial PAD estimates and, consequently, Kosovo now has a fully centralized IT system (KCLIS) that is operational in 35 of its MCOs and a Geoportal with nearly 60 datasets from various institutions in Kosovo. KCA’s technical capacity has also increased in the fields of CR, IT and NSDI, as the project financed the development of CR manuals, an IT strategy and an NSDI strategy. The Bank team continued to work with KCA to address the critical issue of institutional sustainability throughout the project, although this aspect remains on the unfinished agenda. As noted above, the KCA has prepared a new draft of the Integrated Cadastre Law that aims to enhance KCA sustainability by: (i) addressing the issue of vertical organization for cadastral services under the KCA instead of under municipalities; and (ii) proposing a (partial) self-financing or revenue-sharing structure to allow for the maintenance of KCA IT and geospatial systems. The critically important issue of KCA sustainability will continue to be supported under the proposed REGIP project. Mobilizing Private Sector Financing 46. Land administration is an essential public service that underpins economic growth and poverty reduction.48 A 2014 study49 on completed land registration projects concluded that public sector investment in land registration systems is highly beneficial to the economic development of a country with a high rate of return on public investment. In addition, increased access to geospatial data will not only have a direct impact on public sector management and decision-making, but also provide new opportunities for small enterprises to generate value-adding services and jobs. Simultaneously, the cost of land administration services remains high, making registration usually out of the reach of ordinary Kosovars. Additionally, Kosovo has a high degree of economic informality, which means that property ownership often remains informal. Therefore, the Bank’s financing and technical expertise are critical to furthering the land rights agenda in Kosovo, formalizing property rights, developing a building register and boosting the real estate and related sectors (e.g. mortgage lending, construction, etc.). In doing so, RECAP investments contributed to the agenda of maximizing finance for development or mobilizing private sector capital. For example, the clarification of property rights and increased security of tenure can be seen as de-risking interventions that promote increased private sector activity domestically and increase 48 Deininger, K. 2003. Land Policies for Growth and Poverty Reduction. Washington DC: The World Bank. 49Economic Impact of 20+ Years of ECA Land Registration Projects; Satana, Adlington, Torhonen, Anand; Annual World Bank Land and Poverty Conference 2014. Page 20 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) the appetite for foreign direct investments. Poverty Reduction and Shared Prosperity 47. RECAP contributed to the Bank’s twin goals of poverty reduction and increasing shared prosperity, particularly within the realm of increased economic and business opportunities. The CR activities in priority CZs, for example, have benefitted private citizens and businesses of Kosovo as well as investors, domestic and foreign, that seek to invest in Kosovo’s property market. The land and property owners who participated in CR now have the appropriate documentation in order to obtain commercial bank loans for activities such as starting or expanding a business. Other Unintended Outcomes and Impacts 48. The upgrade of KCA’s centralized land information system, KCLIS, towards a service-oriented architecture (KCLIS-SOA) was an important unintended outcome of RECAP. The upgrade began under the Level 2 Restructuring of January 2017 and will allow for future investments under REGIP to launch e- services and to contribute towards the system’s interoperability with other registers such as civil register and address register. KCLIS-SOA’s statistical modules provide a more accurate and seamless data collection mechanism. The interoperability of KCLIS-SOA will allow KCA and MCOs as well as other Government institutions and agencies to share and obtain information to promote informed decision- making for issues and opportunities that may arise in the land and property sectors in the future. Furthermore, the statistical modules will be invaluable for future M&E data collection under REGIP. As noted in the M&E section below, KCLIS-SOA was a major contributing factor to collecting data for measuring RECAP’s indicators. 49. Another big achievement of RECAP was the commitment with which KCA began approaching the issue of gender-sensitivity in the field of property rights. KCA now applies the gender lens to all activities, including details such as tracking the percentage of women that engage with KCA on the Agency’s Facebook page. Incidentally, women’s engagement on social media channels is about 20 percent, which mirrors the ownership figure of 16.8 percent as noted above. Therefore, the combination of monitoring, awareness campaigns during CR and engagement with KCA’s women clients will continue even when the percentage ownership increases only gradually. 50. Finally, the further development of Kosovo’s National Geoportal was another positive, yet unintended, outcome of RECAP. Although the implementation of a CORN framework was one of the activities of Component B, improved data access via the KCA-administered Geoportal that includes 60 varying datasets was not expected. KOPOS’s links to the CORNs of Montenegro and FYR Macedonia50 and its general regional integration are major milestones in Kosovo’s compliance with the EU’s INSPIRE Directive, which is a contributor to the country’s bid for future EU accession. As noted above, the most visited dataset is the one for cadastral parcels. An objective under REGIP is to finance the improvement of other priority Geoportal datasets in order to help reduce the time and cost of decision-making as a means of benefitting the public and private sectors in Kosovo. The Geoportal’s establishment will also allow for climate impacts to be tracked under REGIP. 50 Final Aide Memoire, June 2018. Page 21 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) III. KEY FACTORS THAT AFFECTED IMPLEMENTATION AND OUTCOME A. KEY FACTORS DURING PREPARATION 51. The continuity of activities including CR and BCC between BETA and RECAP was a major contributor to the successes achieved under RECAP. For example, the procedures and methodology developed under BETA for both BCC and CR were instrumental in RECAP’s preparation. However, by the time of RECAP’s appraisal, Law on Cadastre No. 04/-L-013 was passed, meaning that the CR work that was to be completed under new rules that did not require owners to apply to the court to finalize reconstruction in cases such as inheritance and the subdivision of parcels.51 That being said, the task team fully integrated the new rules into the CR and BCC methodology, which helped to achieve the 30 percent completion rate of reconstruction in Kosovo’s priority CZs. 52. While preparation was sound and allowed for continuity between the two projects, it should be noted that RECAP’s design also included only one PDO indicator that faced challenges as previously described in Section II.B. Although market-based indicators were common for land projects at the time of RECAP’s appraisal, the Bank could have had better foresight or could have taken more time to understand the risks of relying upon such an indicator. Although the issue was mitigated in 2015, this risk to project outcome should have been considered more thoroughly during the design stage. 53. Finally, it should be noted that the project targeted the appropriate beneficiary groups and areas during preparation. The selection of priority CZs in which to undertake CR and BCC, i.e. the areas of Kosovo with the most economic activity, meant that the business climate and investments would improve as the security of land and property rights were enforced. Thus, it was well-planned that RECAP would be implemented in areas of the country where it would have the greatest potential for positive economic impact on citizens. B. KEY FACTORS DURING IMPLEMENTATION 54. RECAP progressed and was implemented largely as planned with regular discussions with KCA and timely submission of M&E reports. Overall, implementation was Satisfactory, with the PDO remaining relevant and no major activity changes needed. Most activities were also completed by June 30, 2017. When challenges arose during the project, the Bank adequately addressed and mitigated them. For example, RECAP experienced an 18-month delay in effectiveness due to delays in the ratification of the project’s Financing Agreement by Parliament. The project’s Development Objective rating was subsequently downgraded to Moderately Unsatisfactory and the Implementation Progress rating was downgraded to Unsatisfactory in March 2011 due to the prolonged delay in effectiveness. This was the only time RECAP ever experienced these ratings. To resolve the issue, the Bank granted three extensions for the effectiveness date52 and maintained good communication with the Government throughout. Both the project team and the CMU met with key figures of Kosovo’s various political parties who were part of Parliament to inform them of what RECAP was about, clarify any misconceptions and to address any concerns regarding IDA financing or project activities. Once the delays that impeded RECAP’s ratification were resolved, Parliament quickly approved the project and it became officially effective on June 17, 2011. 51 BETA ICR. 52 The first extension was from June 8, 2010 to September 8, 2010; the second from September 8, 2010 to December 8, 2010; the third from December 8, 2010 to April 8, 2011. Page 22 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) 55. Other factors during implementation were instrumental to some of the major successes of RECAP. During the Mid-Term Review (MTR), for example, it was first recommended that staff capacity should be enhanced for using reporting tools within KCLIS. By the time of the MTR in October 2013, KCLIS-T had been rolled out to all 35 MCOs and KCLIS-CM was scheduled to be rolled out in 2014. Therefore, it was agreed to include specialized training for IT directorate staff to improve reporting processes and capabilities. Thus, IT staff were better equipped to provide information on transactions, cadastral reconstruction and property ownership. 56. Finally, continuous improvements in quality control during cadastral reconstruction helped to ensure the completeness of cadastral objects to be registered. At the beginning of CR and BCC under RECAP, issues such as the inaccurate positioning of properties in CZs during CR were prevalent. By the time of the MTR, new contracts for CR were developed based on lessons learned from the first set of CR and BCC contracts. Additionally, operational manuals were reviewed and improved and quality control management was implemented under the new set of contracts. Thus, the Bank ensured that the information provided through CR was reliable and accurate so as to avoid major issues such as further disputes over land and property ownership, which contributed to building credibility in Kosovo’s real estate sector, particularly in the priority CZs. IV. BANK PERFORMANCE, COMPLIANCE ISSUES, AND RISK TO DEVELOPMENT OUTCOME A. QUALITY OF MONITORING AND EVALUATION (M&E) M&E Design 57. It must be noted that at the time of RECAP’s appraisal, there was a tendency in the Bank’s land projects to use general market indicators to measure project outcomes and successes. The downside of this practice was felt when the Global Financial Crisis hit the countries with Bank-financed land and real estate project and the progress of all market-linked indicators, including the PDO indicator “Number of transactions registered increased by 10 percent per year,” were negatively affected even though projects continued to reach their objectives. One of the legacies of the effects of the Global Financial Crisis is that the Bank now designs land project indicators that are more insulated from market fluctuations and more accurately reflect project activities, such as “Average number of days to complete the recording of purchase/sale of property in the land administration system” and “Target population with use or ownership rights recorded as a result of the project.” 58. While “Number of transactions registered increased by 10 percent per year” and “Average number of days to complete the recording of purchase/sale of property in the land administration system” were appropriate fits for Outcomes 1 and 2 as described above, it must be explained that “Target population with use or ownership rights recorded as a result of the project” was used to measure PDO Outcome 3 “An increase in the percentage of the population in target areas with registered rights from 30 percent to 80 percent” because it explicitly tracked the number of people who have secure property rights as a result of CR under RECAP. Prior to the addition of this indicator and the other core land indicators to the results framework, the only indicator that specifically tracked the number people with recorded use or ownership rights was the core gender indicator that tracked the percentage for women’s property ownership. The one that was closest to tracking the entire target population was the core IO indicator “Increased coverage to land administration services to all.” This indicator tracked the total number of properties that were registered and compared them to the number of registered properties Page 23 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) that were visible in orthophotos taken in 2009 that were used for its 30 percent baseline.53 However, this indicator tracked registered properties, not the explicit number of people with use or ownership rights.54 While one still could obtain the number of people registered as property owners through the KCLIS, which is how the data for the percentage of women with use or ownership rights was collected, this does not change the fact that the indicator only tracked registered properties. Thus, it was concluded that “Target population with use or ownership rights recorded as a result of the project” was the most appropriate IO indicator to be used to track Outcome 3. 59. As RECAP’s implementation progressed, it became clear that the results chain was not well thought out, such as the unrealistic assumption that transactions could be increased by 10 percent each year as well as a lack of an indicator that specifically tracked the number of people whose property rights were registered as a result of RECAP. Moreover, the Results Framework was not consistent with the PDO or its target outcomes, as the sole PDO indicator did not measure the number of days to register the sale of a residential property or the increase in the percentage of the population in target areas with registered rights. While the appropriate IO indicators were later elevated to measure these outcomes effectively, they should have been included in the Results Framework and categorized as PDO indicators from the beginning. This was a design flaw that, while mitigated under the Level 2 Restructuring of December 2015, should have been foreseen earlier. Aside from this flaw, however, the rest of the outputs and outcomes as described in the Theory of Change were well-conceived and achievable. 60. More IO indicators were also added as project implementation progressed based on new Bank requirements and to provide a more accurate picture of the results of RECAP. For example, RECAP’s Mid- Term Review requested that four new indicators be added to the project’s Results Framework: i) “Target Population with use or ownership rights recorded as a result of the project”, which was later elevated to a PDO indicator; ii) “Target land area with use or ownership rights recorded as a result of the project”; iii) “Land parcels with use or ownership rights recorded as a result of the project”; and iv) “Land parcels with use/ownership rights recorded as a result of the project—female”, which also helped to further monitor the impact of RECAP’s activities on women’s land and property ownership. At the time these indicators were added, there was a requirement that all land projects include these core land indicators into their Results Frameworks. The indicators were first reflected in RECAP’s seventh Implementation Status Report and their formal targets were first reflected in the ninth ISR. 61. Other changes to the M&E design included: i) a disaggregation in data on the number of days to complete the recording of the purchase/sale of property by urban and rural areas, which was first reflected in RECAP’s seventh ISR; and ii) after the first year of RECAP’s implementation, the baseline for the first customer survey was established customer satisfaction with cadastral services at 43 percent55, which subsequently set the goal for a 10 percent satisfaction increase for each customer survey. By RECAP’s closing, customer satisfaction was at 81 percent. Finally, and as explained in Section I.B, the baseline for the “Increased access to land administration services for women” IO indicator was lowered from 30 percent to 12 percent and the “Adoption of National Spatial Data Infrastructure (NSDI) Strategy” and “Creation of Digital Archive” IO Indicators were added under the Level 2 Restructuring of December 53R.Pipe, Monitoring and Evaluation Plan for RECAP and the remainder of BETA, 2011. 54The PAD, however, notes that this core indicator was to be used to track the number of percentage of people with use or ownership rights registered. 55 First reflected in RECAP’s ninth ISR. Page 24 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) 2015. M&E Implementation 62. RECAP systematically collected, recorded and analyzed data in a sound manner, with significant improvements in data collection developing overtime as KCLIS-SOA advanced. Additionally, KCLIS’s rollout nationwide under RECAP was very useful in collecting real-time information on transactions and property registration. Going forward, the statistical module of KCLIS-SOA will be key to continuing the tracking of land transactions as they occur throughout Kosovo. 63. Overall, the methodology for collecting and recording data for each of RECAP’s indicators was sound but with two exceptions: (i) the overestimation of the baseline for women’s property ownership, which was later addressed as described above; and (ii) there being only one PDO indicator that was designed to measure the increase in land transactions, which was also mitigated as described above. Despite the design flaw with the sole PDO indicator not fully measuring the target outcomes of the PDO, it is also important to note that the elevation of the appropriate IO indicators did not affect their original design or methods for measuring the data they monitored. In essence, all of the target outcomes of the PDO were measured throughout RECAP but with two of the indicators erroneously categorized as IO indicators. Thus, there were no major changes in data collection methodology upon the elevation of the IO indicators to PDO indicators. M&E Utilization 64. The Results Framework was utilized to monitor outputs and to focus on areas that were not achieving expectations and were consistently monitored and reported upon the regular Bank visits and in aides-memoire. Although a specific M&E specialist was contracted by the PCO, he left KCA during the final year of the project due to a lack of funding for his contract. Nevertheless, other KCA staff substituted for his absence and continued to review and provide M&E information. Justification of Overall Rating of Quality of M&E 65. The M&E design issues should have been identified when the project was considered by Bank management at the stage of approving the project for appraisal or at negotiations, and this issue is key. Although the indicators were useful and used regularly during project implementation to identify and correct areas that were not performing as expected, the fundamental flaw with the design regarding the sole PDO indicator at the beginning of the project that could not be achieved in non-cumulative terms while also being unable to measure the other Target PDO outcomes leaves the assessment of the Quality of M&E as Substantial. Nevertheless, the project’s IT advances and the rollout of KCLIS nationwide did contribute to improved M&E methodology and coordination of information throughout RECAP, as MCOs no longer needed to report transaction and registration data since KCLIS automatically did this. B. ENVIRONMENTAL, SOCIAL, AND FIDUCIARY COMPLIANCE 66. Environmental and Social Safeguards. RECAP was categorized as a Category B project, triggering World Bank Operational Policy OP 4.01 on Environmental Assessment, mostly due to the reconstruction and refurbishment reengineering activities for the MCOs and the KCA office in Prishtina. All associated impacts, such as dust and noise from the construction works, construction waste management and other, small-scale impacts, were easily mitigated through sound construction practices. The PCO has prepared Checklist Environmental Management Plans (EMPs) for each of the project sites that are included in the Page 25 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) bidding documents for each of the respective MCOs or the KCA. The PCO did a sound job of ensuring compliance of the contractor and supervisor as well as adequate reporting. Furthermore, no operational policies for social safeguards were triggered by the project and no issues arose during implementation. Additionally, neither waivers of Bank policies were required, nor did issues arise during project implementation. Overall, the Environmental and Social Safeguards rating is considered Satisfactory. 67. Procurement. A procurement post review mission was conducted in February 2017 and found that in general the PCO/KCA had followed the World Bank procurement procedures set forth in the PAD, Legal Agreement and procurement plan. The PIU/KCA had completed the procurement process for all contracts under the project, and for most of them contract implementation is also finalized. Furthermore, there were no issues with or downgrades in procurement ratings throughout the project. Thus, the Procurement rating for the Project is Satisfactory. 68. Financial Management (FM). The FM arrangements in place for the project are rated as Satisfactory for the entirety of the project term. The KCA Finance and Budget department was responsible for FM. Support was provided by an FM expert during the term. There have been accurate and reliable project accounting records and adequate controls over processing of payments and invoices. High compliance with Bank financial reporting and disbursement requirements were observed during project implementation, with only a few and occasional delays. No issues and findings have been reported by the auditors of the annual project financial statements. The audit of the project financial statements for the year 2017 was conducted by the National Audit Office. No significant issues have been reported by the auditors in their audit report and management letter. The audit of the final period in 2018 will be submitted by the end of June 2019. C. BANK PERFORMANCE Quality at Entry 69. As noted above, the team successfully took into account the lessons learned and progress achieved under BETA while designing and preparing RECAP. Furthermore, all appropriate safeguards and fiduciary assessments were conducted to ensure that the KCA had the institutional capacity to implement RECAP. Additionally, the conditions for credit effectiveness ensured that the PCO consisted of the appropriate staff and had a Financial Management Manual that was acceptable to the Bank as a means of ensuring KCA’s readiness for project implementation. However, the issue of having a PDO indicator that did not measure all three outcome targets should have been addressed during the project design stage. Furthermore, and as noted in the efficiency analysis above, the original economic analysis for the PAD was both optimistic and had a narrow view of project benefits. In retrospect, the forecasted economic analysis did not appropriately capture the estimated positive outcomes that RECAP would produce in line with the PDO. Quality of Supervision 70. The review of project records, together with testimonials from project participants during the life of RECAP, confirm that the Bank provided effective support to implementation. The task team continuously assisted the project teams to improve implementation and track progress towards the PDO. This was done through a mix of in-country missions as well as remote support from Washington, DC. The active participation of a country-based staff in supervision also allowed for immediate support and high- level policy discussions as needed. The Bank team helped KCA personnel to improve field data collection Page 26 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) and management significantly throughout the project. It should also be noted that the Bank took the appropriate steps to address the project’s only Unsatisfactory rating when it arose; the 18-month delay in effectiveness due to circumstances outside the scope of the project resulted in the only time that RECAP experienced Moderately Unsatisfactory and Unsatisfactory ratings for Development Objectives and Implementation Progress, respectively, in March 2011. As noted above in the “Key Factors during Implementation” section, the Bank extended the effectiveness date three times and maintained good communication with the Government until this issue was resolved and RECAP officially became effective. Finally, in response to Government requests, the Bank agreed to extend the project’s closing date three times as described in Section I.B to ensure solid implementation and address issues regarding the institutional sustainability of KCA. Justification of Overall Rating of Bank Performance 71. The assessment is that although the Quality at Entry was generally adequate but had shortcomings. Going forward, however, the Bank maintained a high degree of proactivity and responded quickly and appropriately to project needs. Keeping these two factors in mind, the overall rating of Bank Performance is Moderately Satisfactory. D. RISK TO DEVELOPMENT OUTCOME 72. KCA Institutional Sustainability. Due to the strong decentralization that was introduced as part of independence, cadastral services, revenues and investments in Kosovo are mixed between the central and local governments. A significant imbalance exists at the central level (KCA), which is responsible for investments and maintenance of the cadastral data and systems, while the cadastral service revenues are generated at MCOs and go to the municipalities. This creates a mismatch in revenues and expenditures, as KCA often does not have its own resources or reserve funds for essential items such as software upgrades and, therefore, relies on Government budget allocations, which may not always suffice. Additionally, cadastral staff are appointed by the mayor of the municipality, creating a large turnover after elections and associated challenges with capacity. As noted above, these issues were analyzed and initial reform options were presented under RECAP, particularly the draft of the Integrated Cadastre Law. REGIP will continue to support the preparation of the new law, focusing on a more sustainable land administration agency and services. 73. Additional KPCVA Mandate. In December 2016, the KPCVA Law was passed, changing the nature of the former Kosovo Property Agency and creating the new Kosovo Property Comparison and Verification Agency. Since then, the Agency’s additional mandate is to process the pending return of pre-1999 cadastral documents. On the one hand, the return of these documents could help fill certain gaps in the Kosovo cadastre. On the other hand, if the pre-1999 documents are not properly integrated into the Kosovo cadastre, it could potentially decrease tenure security (particularly for third-party bona fide property owners) and could cause disruptions in the property market. This risk, in turn, could affect the sustainability of cadastre reconstruction investments already made in 30 percent of Kosovo’s priority CZs under RECAP as well as new CR investments planned under the REGIP project.56 56 During REGIP preparation, several discussions took place to include KPCVA as an implementing agency under REGIP. However, these discussions were inconclusive. Therefore, the Bank team plans to continue to engage with KPCVA and REGIP will have unallocated funds in the amount of US$ 0.5 million that could be used to support KPCVA at a later date. For details, please see the REGIP PAD. Page 27 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) V. LESSONS AND RECOMMENDATIONS 74. There are a number of important lessons learned from RECAP that should be considered when preparing and designing future lending projects: 75. Gender. A big achievement of RECAP was the commitment with which KCA began approaching the issue of gender-sensitivity in the field of property rights despite the slow process of improving women’s land rights against prevailing societal norms. As noted above, KCA now applies the gender lens to all activities, including tracking the percentage of women that engage with KCA on its Facebook page. Therefore, one of the lessons learned from RECAP is that future Bank-financed projects should target the gender sensitization of the implementing agency, as this helps to mainstream gender into regular agency operations and ensures the drive for sustainability of gender-related outcomes beyond the life of Bank- financed projects. Furthermore, the Bank was able to secure money from a Bank-executed TF, which was used alongside RECAP-financed CR activities to design and conduct a randomized control trial to inform the messaging in the field to facilitate the recording the husband and wife as co-owners. It was seen that public outreach activities will seek to raise women’s awareness of their property rights and the importance of including their name as co-owners. Such complementary TF activities should, therefore, be sought and implemented to improve the achievement of the Bank’s corporate commitments. Additionally, as a means of ensuring a high degree of client ownership, the client should be included in the design and implementation of the activities from the beginning. 76. Institutional Reform. Under RECAP, all major donors who were implementing projects in the land sector were aware of the key issue of KCA’s institutional sustainability. The donors’ general consensus and insistence that the Government acknowledge and address this matter were big contributors to the achievements under RECAP, such as the development of the GCN, which defined what a sustainable KCA would look like, and its later use in drafting the Integrated Cadastre Law. The lesson learned here is that donor funding can help provide the key leverage needed to initiate major legislative reforms that will help to secure the sustainability of their own technical investments. Nevertheless, one must remember that major legislative reforms take a long time and require a lot of discussion between key stakeholders, which is one of the reasons why legislative reform was not achieved under RECAP. Further support to these discussions are planned for REGIP. 77. KPCVA Mandate. In December 2016, KPCVA adopted an additional mandate of processing the pending return of pre-1999 cadastral documents. These documents may create benefits for the cadastral records in Kosovo but may also pose some sustainability risks if these documents are not integrated properly into the Kosovo cadastre, including areas where cadastral reconstruction has been done. Despite KPCVA not being a RECAP project implementing agency, the team has maintained a dialogue with KPCVA and other stakeholders to ensure KCA and KPCVA are well coordinated on property market issues. The same will be maintained under REGIP, the new operation. The lesson, therefore, is that the project and Bank team need to be agile with risk mitigation measures with respect to any potential new risks that emerge during implementation, which may result from factors that are external and outside of the project’s control. 78. Delay in Effectiveness. Another important lesson learned is the need to explain the project’s benefits to key officials in charge of project ratification. Although the Bank did a thorough job raising the awareness of RECAP benefits to all major political parties in Kosovo’s Parliament, the project’s Page 28 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) effectiveness was still delayed by 18 months. Thus, it is recommended to follow a more proactive awareness attitude for REGIP and other projects that may face a similar challenge. It is extremely important to equally engage both the ruling parties and opposition to generate widespread support for an important reform agenda. Page 29 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ANNEX 1. RESULTS FRAMEWORK AND KEY OUTPUTS A. RESULTS INDICATORS A.1 PDO Indicators Objective/Outcome: Helping to develop Kosovo's land and property markets. Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Number of transactions Number 27500.00 44289.00 48718.00 31274.00 registered increased by 10% per year. 31-Dec-2008 31-Dec-2008 31-Dec-2017 30-Jun-2018 Comments (achievements against targets): The number of transactions registered between January and December 2017 was 31,274, which is below the 2017 target of 48,718. The issue of number of transactions, a market-driven indicator, was brought up during the restructuring in December 2015 and was noted as being linked to Kosovo’s macroeconomic conditions. The Project cannot affect these conditions and therefore the performance of this PDO indicator has fluctuated over time, with overachievement in some years and underachievement in other years. However, on a cumulative basis, the Project has overachieved this target. For example, the cumulative target up to 2017 was 260,897 transactions whereas the Project recorded 320,167 transactions i.e. 23% over the cumulative target. The final number of transactions for 2018 is not yet available, but assuming the same number of transactions from 2017 are achieved in 2018 (31,274 transactions), the final cumulative number of transactions over the Project period is estimated at 351,441 transactions. Note: Under the Level II Restructuring of December 2015, the original target of 44,289 for this indicator was not changed. For the purposes of this ICR, the final target of 48,718 for 2017 is being considered to show the performance of this market-driven indicator on a cumulative basis. Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Page 30 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Avg no. of days to complete Number 30.00 10.00 10.00 9.84 recordn of purchase/sale of property in land adm systm 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Avg no. of days to complete Number 30.00 10.00 10.00 9.84 recordn of purchase/sale of property–Urban 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Avg no. of days to complete Number 30.00 10.00 10.00 9.84 recordn of purchase/sale of property–Rural 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Target popln with use or Number 0.00 180000.00 180000.00 300000.00 ownership rights recorded as a result of the project 17-Jun-2011 17-Jun-2011 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): BCC affected 30 cities where are collected data for 3040 buildings, 41500 part of buildings and target population of 480,000 inhabitants. Objective/Outcome: Land tenure security in Kosovo improved. Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Page 31 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Avg no. of days to complete Number 30.00 10.00 10.00 9.84 recordn of purchase/sale of property in land adm systm 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Avg no. of days to complete Number 30.00 10.00 10.00 9.84 recordn of purchase/sale of property–Urban 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Avg no. of days to complete Number 30.00 10.00 10.00 9.84 recordn of purchase/sale of property–Rural 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Target popln with use or Number 0.00 180000.00 180000.00 300000.00 ownership rights recorded as a result of the project 17-Jun-2011 17-Jun-2011 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): BCC affected 30 cities where are collected data for 3040 buildings, 41500 part of buildings and target population of 480,000 inhabitants. A.2 Intermediate Results Indicators Component: Component A: Municipal Land Administration Indicator Name Unit of Measure Baseline Original Target Formally Revised Actual Achieved at Page 32 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Target Completion Improved Days 30.00 10.00 10.00 9.84 cadastre/registration services for customers: 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Average number of days to register a standard purchase/sale of a typical resi dential property in the land administration system. Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Number of reengineered Number 2.00 23.00 23.00 23.00 MCOs 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Increased coverage to land Percentage 30.00 80.00 80.00 77.40 administration services for all. 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Page 33 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Increased access to land Percentage 12.00 0.00 15.00 16.81 administration services for women 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Target land area with use or Hectare(Ha) 0.00 0.00 50000.00 84639.00 ownership rights recorded as a result of project 17-Jun-2011 17-Jun-2011 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): The previous figure of 465,300 as reported in the penultimate ISR was mistakenly reported. The error has been corrected. Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Land parcels with use or Number 0.00 0.00 132000.00 178412.00 ownership rights recorded as a result of the project 17-Jun-2011 17-Jun-2011 30-Jun-2018 30-Jun-2018 Land parcels with Number 0.00 0.00 26400.00 29991.00 Page 34 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) use/ownership rights 17-Jun-2011 17-Jun-2011 30-Jun-2018 30-Jun-2018 recorded as a result of project-female Comments (achievements against targets): Component: Component B: KCA Institutional Framework Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Licensed private surveyors Number 0.00 30.00 30.00 159.00 using CORN 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Operation manuals for Text Draft In use. In use. In use. MCOs: back office/front office 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Page 35 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) KCA Guidelines Approved Text 0 4 4 4 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion KCA Manuals Text 1. BCC Manual 1. BCC Manual in 1. BCC Manual in All manuals are in use. drafted. use2. CR Manual in use2. CR Manual in 2. CR Manual drafted. use3. QC BCC and CR use3. QC BCC and CR in use. in use. 31-Dec-2008 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Adoption of National Spatial Yes/No N Y Y Y Data Infrastructure (NSDI) Strategy 30-Nov-2015 30-Nov-2015 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Formally Revised Completion Page 36 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) Target Creation of Digital Archive Yes/No N Y Y Y 30-Nov-2015 30-Nov-2015 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): Component: Component C: Project Management, Training, and Public Outreach Formally Revised Actual Achieved at Indicator Name Unit of Measure Baseline Original Target Target Completion Customer surveys to assess Percentage 43.00 0.00 53.00 81.00 satisfaction level achieved 31-Jul-2010 31-Dec-2008 30-Jun-2018 30-Jun-2018 Comments (achievements against targets): According to the latest annual survey, 81 percent are satisfied, with different levels of satisfaction: 4 percent very satisfied, 51 percent satisfied, 26 percent satisfied to some extent. B. KEY OUTPUTS BY COMPONENT Objective/Outcome 1: Helping to Develop Land and Property Markets 1. A percentage increase in the number of transactions registered (10%); Outcome Indicators 2. Reduction of the average number of days to register the sale of a residential property (from 30 days to 10 days); and Page 37 of 52 3. An increase in the percentage of the population in target areas with registered rights. 1. Number of reengineered MCOS; 2. Operation manuals for MCOs: back office/front office; 3. Increased coverage to land administration services for all; 4. KCA Guidelines Approved; 5. KCA Manuals; Intermediate Results Indicators 6. Target population with use or ownership rights recorded as a result of the project; 7. Target land area with use or ownership rights recorded as a result of project; and 8. Land parcels with use or ownership rights recorded as a result of the project. 1. KCA central office and 22 MCOs, including Gjakova and Gjilan, renovated and equipped with furniture and IT equipment; 2. 5 MCOs (out of initially planned 9 MCOs) re-engineered by European Commission supplied with furniture and IT equipment; 3. Cadastre Reconstruction (CR) of 30 percent of priority cadastral zones (159 zones total of which 116 were directly financed by RECAP while others benefitted from Guidelines and Manuals); 4. Building Cadastre (BCC) work has been completed in 30 cities; Key Outputs by Component 5. KCA Guidelines and Manuals were approved early in the Project and (linked to the achievement of the Objective/Outcome 1) have been improved and published. The improvements include quality assessments and quality controls recommendations from the Bank, international QC consultant, and contractors who worked with KCA. The Manual, the Catalogue, and QC guidelines that have been published will be helpful for KCA and MCO staff, future contractors, and CR commission members; and 6. Focus on data quality control and improvement, for example the Quality Control (QC) processes put in place resulted in the number of critical errors have gone down from 155 percent in the first batch (92 Page 38 of 52 critical errors in 80 cases) to 30 percent in the latest batch (12 critical errors in 40 cases). Objective/Outcome 2: Improving Tenure Security 1. A percentage increase in the number of transactions registered (10%); 2. Reduction of the average number of days to register the sale of a Outcome Indicators residential property (from 30 days to 10 days); and 3. An increase in the percentage of the population in target areas with registered rights. 1. Average number of days to complete recording of purchase/sale of property in land administration system; 2. Average number of days to register a standard purchase/sale of a typical residential property in the land administration system; 3. Licensed private surveyors using Continuously Operation Reference Intermediate Results Indicators Network (CORN); 4. Increased access to land administration services for women; 5. Customer surveys to assess satisfaction level achieved; and 6. Land parcels with use/ownership rights recorded as a result of project-female. 1. Project support to KCA in elaborating the following documents: GCN; financial analysis, legal review and proposal for new organizational structure of the KCA and MCOs, strategy and the business plan; 2.The GCN has been approved by the Ministry of Environment and Key Outputs by Component Special Planning (MESP) which concludes that the elaboration of new (linked to the achievement of the Objective/Outcome 2) integrated Law on Cadaster is the best option for KCA’s institutional framework and financial sustainability; 3. The Inter-Ministerial Committee of Land Administration has discussed the need for KCA’s institutional reform and sustainability issues and acknowledged its support to the changes; Page 39 of 52 4. Continuous Operating Reference Network (CORN) has been established and is operational; 5. Rollout of the Cadastre Map (CM) module of the Kosovo Cadastre Land Information System (KCLIS) to 35 out of 38 MCOs. 6. KCLIS has been developed towards service-oriented architecture. Page 40 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ANNEX 2. BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION A. TASK TEAM MEMBERS Name Role Preparation Supervision/ICR Aanchal Anand, Kathrine M. Kelm Task Team Leader(s) Arben Maho, Manjola Malo Procurement Specialist(s) Jonida Myftiu Financial Management Specialist Esma Kreso Environmental Safeguards Specialist Aimonchok Tashieva Social Safeguards Specialist Lindita Lepaja Team Member Blerta Qerimi Team Member Ivana Bojic Team Member B. STAFF TIME AND COST Staff Time and Cost Stage of Project Cycle No. of staff weeks US$ (including travel and consultant costs) Preparation FY07 19.581 112,823.15 FY08 21.467 115,192.25 FY09 17.162 108,275.99 FY10 24.540 164,349.58 Total 82.75 500,640.97 Supervision/ICR FY10 .475 2,704.48 FY11 13.226 83,589.51 FY12 10.130 103,212.04 Page 41 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) FY13 11.908 102,342.50 FY14 14.545 95,173.03 FY15 33.563 145,790.89 FY16 22.928 172,288.80 FY17 25.084 158,589.11 FY18 20.789 137,634.09 FY19 6.981 34,452.64 Total 159.63 1,035,777.09 ANNEX 3. PROJECT COST BY COMPONENT Amount at Approval Actual at Project Percentage of Approval Components (US$M) Closing (US$M) (US$M) Component A: Municipal 7.38 7.59 97.2 Land Administration Component B. KCA 1.69 2.43 69.5 Institutional Framework Component C. Project Management, Training, and 2.62 1.67 156.8 Public Outreach Total 13.86 11.69 0.00 Page 42 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ANNEX 4. EFFICIENCY ANALYSIS A. METHODOLOGY FOR ECONOMIC ANALYSIS 1. At the time of Project preparation, the efficiency analysis of RECAP was done based on four key variables: number of sales, number of mortgages, the average property value and the average mortgage value. The ICR, however, will not replicate the PAD analysis for RECAP efficiency because of the following three reasons. 2. First, as explained in the case of the PDO indicator on the number of transactions, the sales across the years fluctuated, making the PAD ex-ante analysis aggressive in hindsight. For example, the End Target for 2017 for the number of transactions was 48,718 whereas by December 31, 2017 the actual number transactions registered was 31,274, or only 64 percent of the said target. The project could not affect circumstances such as the macroeconomic fluctuations that arose during RECAP’s implementation due to the effects of the Global Financial Crisis, resulting in the overachievement of the indicator in some years and its underachievement in others. The issues related to the PDO indicator and its achievement have been discussed in detail in Section II.B of the ICR and, therefore, will not be further discussed in this Annex. 3. Second, the PAD economic analysis did not take into account key market realities in Kosovo such as the high degree of informality in the real estate sector. As a result, the actual number of registered mortgages lagged behind the PAD forecasts. The figure below shows that the number of actual registered mortgages between 2011 and 2017 averaged at about 3,710 per year. In contrast the average number of registered mortgages forecasted in the PAD in the Without Project scenario was 8,491 per year and in the With Project scenario was 9,025 per mortgages. In other words, the PAD forecasts for the average number of registered mortgages in the Without and With Project scenarios were higher than the actuals by a factor 3.3x and 3.5x respectively.57 Number of Registered Mortgages 12,000 10,955 10,239 9,569 10,000 8,943 8,358 9,783 7,811 7,300 8,873 9,317 8,000 8,451 7,665 8,048 7,300 6,000 4,000 4,538 4,659 3,663 3,816 3,473 2,000 2,546 3,275 0 2011 2012 2013 2014 2015 2016 2017 PAD: Without Project Scenario PAD: With Project Scenario Actuals 4. Third, due to the macroeconomic uncertainty and the delayed effects of the Global Financial Crisis on the Kosovo economy, the actual average property values and average mortgage values lagged behind the PAD forecasts, further rendering the PAD forecasts problematic. 57 PAD forecast for the number of sales mortgages is reconstructed based on the assumptions presented on Page 60 of the RECAP PAD. Page 43 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) 5. On the one hand, the PAD economic analysis was aggressive in its forecasts. One the other hand, it did not take into account more direct benefits coming from project activities like cadastral reconstruction and building cadastral construction, which contributed to the achievement of the PDO. In light of the above, the PAD economic analysis is not replicated for the ICR efficiency analysis because it is considered both aggressive in its assumptions and narrow in its approach. 6. Instead, the ICR efficiency analysis and the calculations of net present value (NPV) and internal rate of return (IRR) are based on three direct benefits. These are: (1) immediate cost savings to citizens from cadastral reconstruction; (2) immediate cost savings to citizens, businesses, and government (local/national) from building cadastre construction; and (3) productivity gains from digital archive (indicator added during the Level II restructuring in December 2015). Furthermore, additional economic benefits are mentioned though they are not used in the NPV and IRR calculations as they are difficult to quantify or attribute entirely to the Project. B. DIRECT RECAP BENEFITS (Used for NPV and IRR Calculations) 7. As discussed above, the ICR efficiency analysis is based on three direct benefits: 8. First, cadastral reconstruction financed by RECAP updated the cadastral information for and registered 330,000 parcels between 2013 to 2017. The cost of sporadic registration of one parcel in Kosovo EUR 150—representing 50% of average monthly wage and even a higher percentage of income of the bottom 40 percent. Therefore, cadastral reconstruction paid for by RECAP was crucial in clarifying the property rights associated with 330,000 parcels. This represents EUR 49.50 million cumulative savings for citizens that did not have to pay sporadic registration costs but will get the benefits of registration. 9. Second, similar to the benefits of CR, the building cadastre construction (BCC) activities clarified the rights for 3,040 buildings and 41,500 parts of buildings (e.g. apartment and business premise) in 30 cities between 2012 and 2015. The costs of sporadic registration associated with buildings and parts of buildings are EUR 120 and EUR 80 respectively. Therefore, the BCC work financed by RECAP represents cumulative savings of EUR 3.68 million to citizens, businesses, and government as they did not have to pay BCC costs but will get the benefits from registration. 10. Third, the digital archive was launched in 2015. Investments in digital archive can lead to significant productivity gains for both KCA and MCOs because staff do not have to spend time manually checking paper archives and documents across KCA and MCOs are available online and do not require travel from one office to another. Time savings can range from 1 hour for simple sale extracts, 2-4 hours for historical extracts, and sometimes weeks for more complex cases requiring travel to other parts of Kosovo. For the sake of simplicity, a 2-hour time saving per transaction is assumed over transaction requests to KCA/MCO. To remain conservative, the requests are capped at 20% of actual registered sales. Based on average wage in Kosovo and estimating that only up to 30% of the MCOs have completed massive scanning for the digital archive, the estimated productivity gains are EUR 0.04 million for the period of 2015 to 2018. These benefits will continue well beyond 2018 but the analysis only presents direct benefits accrued over the project period. Page 44 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) 11. Based on the above three channels of benefits, a high discount rate of 25%58, and Project period of 2011 to 2018, the Project NPV is estimated at EUR 6.18 million (~USD 5.15 million) and the IRR is estimated at 40.92%. 12. Since the NPV is greater than zero and the IRR comfortably exceeds the discount rate of 25%, the Project efficiency is rated as High. 13. A summary table with key figures is presented below. Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Cumulative 2011 2012 2013 2014 2015 2016 2017 2018 Total RECAP Benefits (Direct Only) EUR M 0.00 0.37 3.21 6.06 13.85 12.38 17.33 0.02 53.23 Total RECAP Cost EUR M -12.00 -12.00 Net RECAP Benefits EUR M -12.00 0.37 3.21 6.06 13.85 12.38 17.33 0.02 41.23 Discount Rate % 25.0% Net Present Value EUR M 6.18 Internal Rate of Return % 40.92% Benefit-to-Cost Ratio (Undiscounted) x 4.44x Benefit-to-Cost Ratio (Discounted) x 1.64x C. INDIRECT RECAP BENEFITS (Not Used for NPV and IRR Calculations) 14. In addition to the direct benefits that can be fully attributed and quantified, there are other RECAP benefits that cannot be fully quantified or attributed to Project activities alone. These benefits are briefly mentioned below but are not included in the NPV or IRR calculations for RECAP. 15. Given the experience of registration projects, RECAP’s investments in CR and BCC can be said to have contributed to increased security of tenure, improved access to finance, and in some cases led to an increase in the loan-to-value ratios of registered mortgages and a reduction in the cost of commercial banks’ due diligence costs to verify ownership. There is, however, not sufficient data available to quantify these benefits. 16. Similarly, women’s property rights have been linked to greater income and agricultural productivity, increased access to finance, reduced gender-based violence, and increased health and education opportunities for children.59 Under RECAP, the percentage of women whose property rights are registered in the system increased from 12% to 16.8%, so these long-term benefits can be expected to reflect in the economy slowly. 58 The PAD had assumed a discount rate of 12%. The ICR efficiency analysis is based on 25% rate, a rate that is more than twice the rate used in the PAD. This is done to remain extremely conservative while presenting RECAP benefits, especially because the PAD analysis cannot be replicated at this stage. 59 A Place of Her Own: Women’s Right to Land, https://www.cfr.org/blog/place-her-own-womens-right-land. Page 45 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ANNEX 5. SUMMARY OF BORROWER’S ICR Note: Below is the Summary of the Borrower's ICR that was prepared by KCA and sent to the Bank on December 12, 2018. Summary of Borrower’s ICR 1. The Government of Kosovo (GoK) provided a detailed final project report of the Real Estate Cadastre and Registration Project (RECAP) that covers the period from July 2011 to June 2018. This report summarizes the achievements and funds used in the implementation of the Real Estate Registration and Cadastre Project (RECAP) by June 2018, and its impact in development of cadaster and land administration in the Republic of Kosovo. The executive summary of the borrower’s completion report is presented below. Executive Summary of Borrower’s ICR 2. Kosovo Cadastral Agency (KCA) is established in June 2000 to set policy and oversee the Municipal Cadastral Offices (MCO’s). In 2000-2003, donors provided funds to automate and register immovable properties. The automated Immovable Property Rights Register (IPRR) was launched in 2005. In the fall of 2008, at the request of the donors and based on a longer term vision, KCA prepared the Kosovo Cadastre Development Strategy (KCDS). The Strategy’s objectives was three-fold: (i) Improvement in the legal and institutional framework for cadastre in Kosovo; (ii) Efficient operation of advanced information technology; and (iii) Improvement of the cadastral services for clients. Subsequently, KCA prepared a Business Plan (BP) 2009 to 2014, which was approved by the Government in June 2009, to be supported from Kosovo Consolidated Budget (KCB) and donors. Apart from the regular activities and numerous projects supported from donors, certainly the most important part of the reform is the Real Estate Cadastre and Registration Project (RECAP) itself, whose main objective was to develop an efficient land administration system for the purpose of developing an efficient real property market. 3. With the establishment of the real estate cadastre on the entire territory of the country, the priorities of the Government and the Kosovo Cadastral Agency (KCA) were directed at additional improvement of the services for registration and cadastre through updating the cadastral data in terms of their accuracy, completeness, update and availability. For this reason the Government of the Republic of Kosovo requested to the Executive Directors of the World Bank to approve a loan in the amount of USD 6.740.000 and grant USD 5.510.000 intended for the Real Estate Cadastre and Registration Project (RECAP). During 2008 and 2009, international consultants assisted the project preparation under a Business Environmental Technical Assistance project (BETA) when expert assessments and the Project Implementation Plan were produced. The five (5) project implementation started on July 01, 2011 and with extension ended in June 2018. 4. The overall project funds amount is distributed as follows: Source of Funding Currency Amount USD Equivalent Page 46 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) IDA Grant H5440 XDR 3,500,000.00 5,510,000.00 IDA Credit 46910 XDR 4,300,000.00 6,740,000.00 Borrower USD 1,610,000.00 1,610,000.00 Total USD 13,860,000.00 5. Overview of Historical Disbursement: Estimated Disbursement in USD Amount 2010 2011 2012 2013 2014 2015 2016 2017 2018 Total Planned Annual IDA Grant & 12,250,000. IDA Credit 00 0.61 1.23 2.45 3.68 3.68 0.6 - - - Historical Disbursement 6,740,000.0 0.66 1.40 1.53 1.13 0.90 0.22 0.00 5.84 - - IDA Credit 0 Historical Disbursement 5,510,000.0 IDA Grant 0 0.05 0.69 0.62 0.51 0.53 1.52 1.1 0.05 5.07 6. From beginning of RECAP till end of the project on June 30, 2018, the Client/Kosovo Cadastral Agency has signed 112 contracts while the number of trainings and workshops conducted are 54. Works, Goods and Services (other than consultant services) Method / Type ICB ICB ICB IC NCB NCB Shop Shop DC DC Total of Good Works Tech B Tech Works ping ping Goods Tech Procurement s . ITS . Good Tech . Serv. Serv. s . Serv. Financial Serv. Resources IDA Grant 2 / / 1 2 / 16 5 1 / 27 IDA Credit / 3 6 1 1 / 11 / / 4 26 TOTAL 2 3 6 2 3 0 27 5 1 4 53 Consultant Services Method / Type Quality and Consultants Individual Sole Source Least Training/ of Procurement Cost Based Qualificatio Consultant Selection Costs Workshops _____________ Selection ns (IC) (SSS) Selection Total Financial (QCBS) (CQS) (LCS) Resources IDA Grant 1 14 39 3 1 54 112 IDA Credit / / / / / / / Page 47 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) TOTAL 1 14 39 3 1 54 112 7. The general and long-term objectives of the Real Estate Cadastre and Registration Project (RECAP) were to support the Government Development Agenda for reduction of poverty, improvement of the economic growth and increase o the investments in the private sector. 8. The project has supported the development of the land and property markets and improve tenure security. This is achieved through: (1) improving the delivery of services by Municipal cadastre offices, where it is done the re-engineering of the working space/offices and supply with IT equipment and furniture of 23 Municipal cadastral offices (out of 38) as well as the main office of Kosovo Cadastral Agency; the registration of buildings and apartments in 30 urban areas of the cities; cadastre reconstruction implemented in 116 cadastral zones (out of 450 priority Zones); (2) strengthening the Kosovo Cadastral Agency (KCA) institutional capacity, where five (5) year Business Plan for KCA is drafted; Kosovo Positioning System (KOPOS) has been established and it is fully operational; National Spatial Data Infrastructure strategy is drafted and the draft law for NSDI is prepared; Integrated law on Cadastre, immovable property rights and mortgages is drafted; It is finalized the establishment of the Disaster Recovery Center (DRC); Development of KCLIS towards SOA (Service Oriented Architecture); Scanning of the archived cadastral documents in 12 Municipal Cadastral Offices; as well as conversion and migration of cadastral data in KCLIS-Cadastral Map (3) supporting implementation of the Business Plan, Project Coordination Office staff, coordinating donor efforts and launching public outreach measures and provide training to KCA, MCOs and service providers, strengthening women`s and vulnerable groups access to property rights. 9. In full cooperation with World Bank team, during 2018 KCA has prepared a new continuation Real Estate Cadastre and Geospatial Infrastructure Project (REGIP) which is really important in carrying further the support of development of cadastre, registration of property rights, NSDI and quality of land administration and geospatial data and services in the Republic of Kosovo. 10. The Government of Republic of Kosovo through implementation agency wishes to express its full gratitude for the assistance and support offered by the World Bank team for successful implementation of RECAP project and continuation of this support with REGIP and other donor partners (Norwegian Government, Swiss Government, GIZ, SIDA, JICA and EU) for their support during the past 17 years. Page 48 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ANNEX 6. SUPPORTING DOCUMENTS Basic Documents: 1. RECAP Project Appraisal Document. December 22, 2009. 2. ICR for BETA. February 25, 2013. 3. IEG ICRR for BETA. September 3, 2013. 4. Interim Strategy Note for Kosovo for the Period FY08. November 9, 2007. 5. Interim Strategy Note for Republic of Kosovo for the Period FY10-FY11. December 28, 2009. 6. Country Partnership Strategy for the Republic of Kosovo for the Period FY12-FY15. May 1, 2012. 7. Country Partnership Framework for Republic of Kosovo for the Period FY17-FY21. April 25, 2017. 8. Implementation Status Reports (ISR). ISRs 1 to 20 covering the period April 7, 2010 to June 29, 2018. 9. Aides Memoire for BETA (includes preparation phase for RECAP) from March 21 – 29, 2011. 10. Aides Memoire for RECAP from July 2010 until June 2018. 11. Financing Agreement. March 10, 2010. 12. Restructuring Papers for RECAP dated July 12, 2015, December 23, 2015, October 23, 2016 and June 27, 2017. Reports: 1. Kosovo National Development Strategy (NDS) 2016 - 2021 2. Korea Peace and Conflict Trust Fund. Randomized Controlled Trial on the Effectiveness of a Door- to-Door Sensitization Campaign to Increase Women’s Property Ownership in Kosovo. n.d. 3. Comprehensive Proposal for the Kosovo Status Settlement. February 2, 2007. 4. Real Estate and Cadastre Project – RECAP Annual Customer Satisfaction and Social Survey. November 2012. 5. Project on Real Estate and Cadastre – RECAP Annual Customer Satisfaction – Second Phase. April 2014. 6. Real Estate Cadaster Project – RECAP Annual Client Satisfaction – Third Phase. December 2016. 7. Pipe, R. 2011. Monitoring and Evaluation Plan for RECAP and the remainder of BETA. 8. Deininger, K. 2003. Land Policies for Growth and Poverty Reduction. Washington DC: The World Bank Others: 1. Reform Roadmap for Land Administration and Property Rights in Kosovo. n.d. 2. Borrower’s ICR. 3. Newsletter: UN-GGIM – Global Geodetic Reference Frame Working Group, February 2016. 4. Economic Impact of 20+ Years of ECA Land Registration Projects; Satana, Adlington, Torhonen, Anand; Annual World Bank Land and Poverty Conference 2014. 5. A Place of Her Own: Women’s Right to Land: https://www.cfr.org/blog/place-her-own-womens- right-land 6. Pichel, F. Documenting Property Rights in Post Conflict Kosovo: https://cadasta.org/kosovo-real- estate-and-cadastre-project-2/ 7. KCA Webpage: http://www.kca-ks.org/ 8. Kosovo State Geoportal: http://geoportal.rks-gov.net/ Page 49 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) ANNEX 7. CONTINUITY BETWEEN RECAP AND REGIP ACTIVITIES 1. RECAP’s achievements mean that future investments in land administration and property rights in Kosovo will progress much more expeditiously, now that more solid legal, technical and capacity foundations are in place. RECAP’s most notable achievements include: (i) a significant improvement in Kosovo’s ranking in the World Bank Doing Business Index for Registering Property from 73 (DB 2012) to 34 (DB 2018); (ii) cadastral reconstruction has taken place in 30 percent of the priority zones of Kosovo; (iii) increased land market efficiency, with more time to register a transaction dropping from 30 days before RECAP to under 10 days as of June 2018; (iv) the development of a centralized IT system, the Kosovo Cadastre and Land Administration System (KCLIS); (v) the IT system at KCA now collects and monitors the data for gender-disaggregated property ownership, an important statistic in understanding and analyzing the current situation for women’s property ownership in the country; and (vi) the introduction of a national spatial data infrastructure with an NSDI strategy approved as well as the establishment of a national Geoportal with access to datasets from seven institutions, including the KCA. 2. RECAP has laid the foundations for the next phase of investments and reforms that are planned under the proposed Real Estate Cadastre and Geospatial Infrastructure Project (REGIP; P164555). These investments will focus on improving public sector service delivery and strengthening private sector competitiveness though: (i) further cadastral reconstruction to improve the availability of correct and up- to-date cadastre information and thus enhance the security of tenure; (ii) investments to advance ICT and geospatial infrastructure that improve availability, affordability and transparency of public services in order to better serve citizens and businesses; (iii) policy, legal and institutional support; and (iv) capacity building initiatives to improve decision-making, particularly with the use of geospatial data. Given RECAP’s experience and the evolving needs of the Kosovo property market, REGIP investments can be said to be both ground tested and essential for achieving its PDO and also furthering the higher-level objective of improving the security of tenure and quality of services in Kosovo. 3. Specific activities and components that began under RECAP and are to be built upon during REGIP are explained in the following paragraphs. 4. KCLIS-SOA. Under RECAP, KCLIS was enhanced towards a service-oriented architecture (KCLIS- SOA). The SOA allows KCLIS to recombine existing functions to meet changing customer requirements, to develop new functions rapidly and to scale operations to meet different levels of demand. The SOA upgrade under REGIP would, therefore, include the launch of e-services, streamlining of business processes and other activities. 5. Institutional Reform. REGIP will support KCA in the development of the new draft Cadastre Law, a process that began under RECAP with a focus on introducing a vertical organization structure whereby MCO staff would be moved under KCA authority, for more sustainable cadastral services. If possible, the law will be shaped to include additional provisions to promote women’s property rights. 6. IMCLA Meetings. The Inter-Ministerial Committee on Land Administration (IMCLA) was established in 2009 by a government Direction. The IMCLA consists of KCA, KPCVA, MESP, PMO, Ministry Page 50 of 52 The World Bank Real Estate Cadastre and Registration ( P101214 ) of Finance, Ministry for Public Administration, Ministry of Local Administration, Ministry of Agriculture, Forestry and Rural Development, among others. The invitation to IMCLA meetings is dynamic and can include agencies and ministries as needed to improve coordination efforts where they are needed most. With the support of RECAP, the IMCLA met twice a year. Such support will continue under REGIP to facilitate broader strategic dialogue on land and geospatial issues in Kosovo as well as provide KCA a platform to share project developments and results and seek support on important matters such as the promulgation of the NSDI Law. 7. Quality Control. The quality control (QC) process that was set up under RECAP will be further refined and streamlined under REGIP. This activity will be a sub-component of REGIP’s Component B: Cadastre Modernization and will support: (i) the enhancement and further development of QC procedures, including moving to digital workflows; (ii) updating existing or creating new manuals and Administrative Instructions; and (iii) QC of cadastral reconstruction contractors – procedures and cadastral data (contracted out). 8. Cadastre Modernization. As noted above, this is Component B of REGIP and its objective is to continue the cadastre reconstruction work that was started under RECAP. Thus far, approximately 36 percent of priority zones (estimated at 450 cadastral zones) representing 12 percent of the land parcels in the territory of Kosovo have undergone cadastral reconstruction. This component aims to add another 33 percent of priority zones or 12 percent of land parcels, taking the total number of priority zones to nearly 70 percent and parcels with updated cadastral information to 24 percent of the total. The component would also provide additional support to the national geodetic framework, the initial development of a utility cadastre, further work to develop the buildings cadastre that was started under RECAP, and refurbishment for the remaining MCOs. Additionally, activities financed under this component (e.g. utility cadastre, building register, and reengineering) will support climate disaster preparation, response and recovery. 9. Services to support GNSS. The Global Navigation Satellite System (GNSS) investments made in the RECAP project will be further strengthened over the 5 years of the REGIP by providing funds to maintain and enhance the current KOPOS (Kosovo Positioning System). Activities that will build upon RECAP’s investments include: (i) the replacement and upgrading of GNSS equipment, including some minor re- positioning, where necessary; (ii) the purchase of three additional licenses for network processing and network adjustment to complete linking and harmonizing the Kosovo GNSS network with neighboring networks; (iii) contingency for changing the location of one of the receiver stations, in case they are located in buildings scheduled for renovation or rebuild; (iv) upgrading the software for the monitoring receiver stations, administration and monitoring of users, and online support; and (v) the purchase of one robotic Total Station for monitoring the positioning of control points in the terrestrial reference network. 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