THE WORLD BANK I BANK DUNIA Sharing Development Solutions for an Emerging Indonesia OFFICIAL W0CUMENTS Letter No. CD-168/GFDRR PNPM/IV/2013 April 15, 2013 Mr. Agus Suprijanto Director General of Treasury Ministry of Finance JI. Lapangan Banteng Timur 2-4 Jakarta Pusat Dear Mr. Agus Suprijanto: Re: Indonesia - GFDRR Grant No. TFO98817 (Disaster Risk Management Program for the Third National Program for Community Empowerment in Urban Areas Project) Additional Instructions: Disbursement I refer to the Grant Agreement ("Agreement") between the Republic of Indonesia (the "Recipient") and the International Bank for Reconstruction and Development ("World Bank"), acting as Administrator of the Global Facility for Disaster Reduction and Recovery (GFDRR), for the above-referenced project, dated April 15, 2013. The Agreement provides that the World Bank may issue additional instructions regarding the withdrawal of the proceeds of Grant No. TF098817 ("Grant"). This letter ("Disbursement Letter"), as revised from time to time, constitutes the additional instructions. The attached World Bank Disbursement Guidelines for Projects, dated May 1, 2006. ("Disbursement Guidelines") (Attachment 1), are an integral part of the Disbursement Letter. The manner in which the provisions in the Disbursement Guidelines apply to the Grant is specified below. Sections and subsections in parentheses below refer to the relevant sections and subsections in the Disbursement Guidelines and, unless otherwise defined in this letter, the capitalized terms used have the meanings ascribed to them in the Disbursement Guidelines. 1. Disbursement Arrangements (i) Disbursement Methods (section 2). The following Disbursement Methods may be used under the Grant: * Reimbursement * Advance * Direct Payment (ii) Disbursement Deadline Date (subsection 3.7). The Disbursement Deadline Date is four (4) months after the Closing Date specified in the Grant Agreement. Any changes to this date will be notified by the World Bank. ISEB Tower 2, 12th Floor, JI. Jend. Sudirman Kay. 52-53, Jakarta 12190 3+6221 5299 3000 0 +6221 5299 3111 0 www.worldbank.org/id TF098817 2 of 4 April 15, 2013 (iii) Disbursement Conditions (subsection 3.8). Please refer to the Disbursement Condition(s) in the Grant Agreement. II. Withdrawal of Grant Proceeds (i) Authorized Signatures (subsection 3.1). Applications for this Loan will be signed by the officials authorized to sign Applications as indicated in Ministry of Finance letters No. S- 9349/PB/2012 dated November 21, 2012. Please notify us promptly should there be any change in the authorized officials in this regard. (ii) Applications (subsections 3.2 - 3.3). Please provide completed and signed applications for withdrawal, together with supporting documents, to the address indicated below: The World Bank Office Jakarta (WBOJ) Jakarta Stock Exchange Building, Tower 2, 12th Floor Jl. Jenderal Sudirman Kay. 52-53, Jakarta 12190, Indonesia Attention: Disbursement Team (iii) Electronic Delivery (subsection 3.4) The World Bank may permit the Recipient to electronically deliver to the World Bank Applications (with supporting documents) through the World Bank's Client Connection, web-based portal. The option to deliver Applications to the World Bank by electronic means may be effected if: (a) the Recipient has designated in writing, pursuant to the terms of subparagraph (i) of this Section, its officials who are authorized to sign and deliver Applications and to receive secure identification credentials ("SIDC") from the World Bank for the purpose of delivering such Applications by electronic means; and (b) all such officials designated by the Recipient have registered as users of Client Connection. If the World Bank agrees, the World Bank will provide the Recipient with SIDC for the designated officials. Following which. the designated officials may deliver Applications electronically by completing Form 2380, which is accessible through Client Connection (https://clientconnection.worldbank.org). The Recipient may continue to exercise the option of preparing and delivering Applications in paper form. The World Bank reserves the right and may, in its sole discretion, temporarily or permanently disallow the electronic delivery of Applications by the Recipient. (iv) Terms and Conditions of Use of SIDC to Process Applications. By designating officials to use SDIC and by choosing to deliver the Applications electronically, the Recipient confirms through the authorized signatory letter its agreement to: (a) abide by the Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation ("Terms and Conditions of Use of SIDC") provided in Attachment 2; and (b) to cause such official to abide by those terms and conditions. (v) Minimum Value of Applications (subsection 3.5). The Minimum Value of Applications for reimbursement and direct payment is US$100,000. ISEB Tower 2, 12th Floor, JI. Jend. Sudirman Kay. 52-53, Jakarta 12190 a +6221 5299 3000 0 +6221 5299 3111 0 www.worldbank.org/id TF098817 3 of 4 April 15, 2013 (vi) Advances (sections 5 and 6). * Type of Designated Account (subsection 5.3 Segregated. One segregated designated account will be established for the project and managed by the Treasury Department of the Ministry of Finance. * Currency of Designated Account (subsection 5.4): US$ (United States Dollar). * Financial Institution at which the Designated Account Will Be Opened (subsection 5.5): Bank Indonesia or another financial institution acceptable to the World Bank. * Ceiling (subsection 6.1): Forecast for two (2) quarters as provided in the quarterly Interim Financial Report. III. Reporting on Use of Grant Proceeds (i) Supporting Documentation (section 4). Supporting documentation should be provided with each application for withdrawal as set out below: * For requests for Reimbursement. o List of payments against contracts that are subject to the World Bank's prior review. in the form attached (Attachment 3, Form I -B); o Statement of Expenditures in the form attached (Attachment 3. Forms 1-C and 1 -C2) for all other contracts and/or expenditures; and o Interim Financial Reports in the form attached (Attachment 3, Forms IFR- 1 and IFR- 2). * For reporting eligible expenditures paid from the Designated Account: o List of payments against contracts that are subject to the World Bank's prior review, in the form attached (Attachment 3, Form 1-B); o Statement of Expenditures in the form attached (Attachment 3, Forms 1-C and 1 -C2) for all other contracts and/or expenditures: o Project Cash Forecast (Attachment 3, Form 1-D) o Interim Financial Reports in the form attached (Attachment 3, Forms IFR-1 and IFR- 2); and o Designated Account Reconciliation Statement in the form attached (Attachment 3, Form 1-A). * For requests for Direct Payment: Records evidencing eligible expenditures, e.g., copies of receipts, supplier invoices (ii) Frequency of Reporting Eligible Expenditures Paid from the Designated Account (subsection 6.3): The period set out in the Grant Agreement for provision of Interim Financial Reports, i.e. quarterly. (iii) Other Supporting Documentation Instructions: Copies of bank statement of the designated account should be attached to Application for Withdrawal for replenishment of designated account. ISEB Tower 2, 12th Floor, JI. Jend. Sudirman Kay. 52-53, Jakarta 12190 X+6221 5299 3000 *+6221 52993111 O www.worldbank.org/id TF098817 4 of4 April 15, 2013 IV. Other Disbursement Instructions: (i) In the case of the first request for withdrawal submitted to the World Bank before any withdrawal has been made, ie request for initial advances, the Recipient shall submit to the World Bank only a statement with the projected sources and applications of funds for the Project for the period following the date of such request. V. Other Important Information For additional information on disbursement arrangements, please refer to the Disbursement Handbook available on the World Bank's public website at https://www.worldbank.org and its secure website "Client Connection" at https://clientconnection.worldbank.org. Print copies are available upon request. If you have not already done so, the World Bank recommends that you register as a user of the Client Connection website (https://clientconnection,worldbank.org). From this website you will be able to download Applications, monitor the near real-time status of the Grant, and retrieve related policy, financial, and procurement information. All Recipient officials authorized to sign and deliver Applications by electronic means are required to register with Client Connection before electronic delivery can be effected. For more information about the website and registration arrangements, please contact the World Bank by email at . If you have any queries in relation to the above, please contact Chau-Ching Shen, Senior Finance Officer at loaeapa)worldbank.org or the Disbursement Team in WBOJ using the above reference. Yours sincerely, gana Prasta Acting Country Director, Indonesia Attachments 1. World Bank Disbursement Guidelines f6r Projects, dated May 1, 2006 2. Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation, dated March 1, 2013 3. Form of Interim Financial Report Cc: - Mr. Robert Pakpahan, Expert Staff to the Minister of Finance on State Revenue, with full mandate as Director General of Debt Management, Ministry of Finance - Ms. Ayu Sukorini, Director of Funds, Ministry of Finance - Mr. Guratno Hartono, Director of Building and Neighborhood Development, Directorate General of Human Settlements, Ministry of Public Works ISEB Tower 2, 12th Floor, JI. Jend. Sudirman Kay. 52-53, Jakarta 12190 a+6221 5299 3000 i +6221 5299 3111 0 www.worldbank.org/id Attachment 2 Terms and Conditions of Use of Secure Identification Credentials in connection with Use of Electronic Means to Process Applications and Supporting Documentation March 1, 2013 The World Bank (Bank)' will provide secure identification credentials (SIDC) to permit the Borrower to deliver applications for withdrawal and applications for special commitments under the Agreement(s) and supporting documentation (such applications and supporting documentation together referred to in these Terms and Conditions of Use as Applications) to the Bank electronically, on the terms and conditions of use specified herein. SIDC can be either: (a) hardware-based (Physical Token), or (b) software-based (Soft Token). The Bank reserves the right to determine which type of SIDC is most appropriate. A. Identification of Users. 1. The Borrower will be required to identify in a completed Authorized Signatory Letter (ASL) duly delivered to and received by the Bank each person who will be authorized to deliver Applications. The Bank will provide SIDC to each person identified in the ASL (Signatory), as provided below. The Borrower shall also immediately notify the Bank if a Signatory is no longer authorized by the Borrower to act as a Signatory. 2. Each Signatory must register as a user on the Bank's Client Connection (CC) website (https://clientconnection.worldbank.org) prior to receipt of his/her SIDC. Registration on CC will require that the Signatory establish a CC password (CC Password). The Signatory shall not reveal his/her CC Password to anyone or store or record the CC Password in written or other form. Upon registration as a CC user, the Signatory will be assigned a unique identifying account name. B. Initialization of SIDC. 1. Prior to initialization of SIDC by a Signatory, the Signatory will acknowledge having read, understood and agreed to be bound by these Terms and Conditions of Use. 2. Where a Physical Token is to be used, promptly upon receipt of the Physical Token, the Signatory will access CC using his/her account name and CC Password and register his/her Physical Token and set a personal identification number (PIN) to be used in connection with ' "Bank" includes IBRD and IDA. 2 "Borrower" includes the borrower of an IBRD loan, IDA credit, or Project Preparation Facility advance and the recipient of a grant. the use of his/her Physical Token, after which the Physical Token will be initialized for use by the Signatory exclusively for purposes of delivering Applications. Where a Soft Token is to be used, the Signatory will access CC using his/her account name and CC Password and set a personal identification number (PIN) to be used in connection with the use of his/her Soft Token, after which the Soft Token will be initialized for use by the Signatory exclusively for purposes of delivering Applications. Upon initialization of the SIDC, the Signatory will be a "SIDC User". The Bank will maintain in its database a user account (Account) for each SIDC User for purposes of managing the SIDC of the SIDC User. Neither the Borrower nor the SIDC User will have any access to the Account. 3. Prior to first use of the SIDC by the SIDC User, the Borrower shall ensure that the SIDC User has received training materials provided by the Bank in use of the SIDC. C. Use of SIDC. 1. Use of the SIDC is strictly limited to use in the delivery of Applications by the SIDC User in the manner prescribed by the Bank in the Agreement(s) and these Terms and Conditions. Any other use of the SIDC is prohibited. 2. The Bank assumes no responsibility or liability whatsoever for any misuse of the SIDC by the SIDC User, other representatives of the Borrower, or third parties. 3. The Borrower undertakes to ensure, and represents and warrants to the Bank (such representation and warranty being expressly relied upon by the Bank in granting SIDC) that each SIDC User understands and will abide by, these Terms and Conditions of Use, including without limitation the following: 4. Security 4.1. The SIDC User shall not reveal his/her PIN to anyone or store or record the PIN in written or other form. 4.2. The SIDC User shall not allow anyone else to utilize his/her SIDC to deliver an Application to the Bank. 4.3. The SIDC User shall always logout from CC when not using the system. Failure to logout properly can create a route into the system that is unprotected. 4.4. If the SIDC User believes a third party has learned his/her PIN or has lost his/her Physical Token he/she shall immediately notify clientconnectionC@worldbank.org. 4.5. The Borrower shall immediately notify the Bank at clientconnection@aworldbank.org of any lost, stolen or compromised SIDC, and take other reasonable steps to ensure such SIDC are disabled immediately. 5. Reservation of Right to Disable SIDC 5.1. The Borrower shall reserve the right to revoke the authorization of a SIDC User to use a SIDC for any reason. 5.2. The Bank reserves the right, in its sole discretion, to temporarily or permanently disable a SIDC, de-activate a SIDC User's Account or both. 6. Care of Physical Tokens 6.1. Physical Tokens will remain the property of the Bank. 6.2. The Bank will physically deliver a Physical Token to each Signatory designated to receive one in a manner to be determined by and satisfactory to the Bank. 6.3. Physical Tokens contain delicate and sophisticated instrumentation and therefore should be handled with due care, and should not be immersed in liquids, exposed to extreme temperatures, crushed or bent. Also, Physical Tokens should be kept more than five (5) cm from devices that generate electromagnetic radiation (EMR), such as mobile phones, phone- enabled PDAs, smart phones and other similar devices. Physical Tokens should be carried and stored separate from any EMR device. At close range (less than 5 cm), these devices can output high levels of EMR that can interfere with the proper operation of electronic equipment, including the Physical Token. 6.4. Without derogating from these Terms and Conditions of Use, other technical instructions on the proper use and care of Physical Tokens are available at http://www.rsa.com. 7. Replacement 7.1. Lost, damaged, compromised (in terms of 4.5, above) or destroyed Physical Tokens will be replaced at the expense of the Borrower. 7.2. The Bank reserves the right, in its sole discretion, not to replace any Physical Token in the case of misuse, or not to reactivate a SIDC User's Account. 1-A GFDRR Disaster Risk Management Program for PNPM Urban III Project Designated/Special Account Activity Statement for the Reporting Period ... Bank and Account No.: ... USD Part I 1. Cummulative advances to end of current reporting period 2. Cummulative expenditures to end of last reporting period 3. Outstanding advances to be accounted (1-2) Part II 4. Opening SA balance at beginning of reporting period (as of ...............) must be same 5. Add/Substract:Cummulative adjustments (if any) * as s tem3 6. Advances from the World Bank during reporting period 7.add 5 and 6 8. Outstanding advances to be accounted for (4+7) (must be same as item 3) 9. Closing SA balance at end of current reporting (as of ................Ex itusintis 10. Add/substract: Cummulative adjusment (if any) Quarter fm WSs 11. Expenditures for current reporting period Account i.e. F Frms 10+1IC or 12. Add 10+11 Form FR-2 13. Add 9+12 14. Difference (if any) 8-r13 0 P art III = nQua tr fm 15. Total Forecasted amount to be paid by World Bank mccut i(f) . 16. Less: Closing SA balance (as per item 9) 17. Cumulative adjustment (if any)_________________ 18. Add 16+17 19. Cash requirement from WB for next six months (15-18) 20. Amount requested for advance to SA (rounding) *Explanation for item 5 (if not zero): IFMR & AW Ref. IAmount (+/-) Remarks Explanation for item 10 (if not Zero): IFIVR & AW Ref. IAmount (+/-) I Remarks Explanation for item 14 (if not Zero): FMR & AW Ref. Amount (+-) Remarks 19 Explanation for item 17 (if not Zero): IFmh R & AW Ref. Amount (+/-) Remarks 1-B GFDRR Disaster Risk Management Program for PNPM Urban Ill Project Summary Sheet for Payments of Contracts Subject to Prior Review Quarter : ... year ... TF No. : 098817 Sheet No.: 1 2 3a 3b 4 59 13 Item Disbursement Category Office Cross-Ref Date of Contract | Supplier/ Contract Total Amount WB Amount of Exchange Amount WB's No. Issuing SP2D Payment No. Contractor Value Paid to Financing WB portion Rate Charged contract Cat No. Description SP2D No. (SP2D) and Date Name (incl. Add) Contractor % paid Applied to SA ref. (GOI+IBRD+PPN) (USD eqv) -I (1) Kelurahan Grants under Part 2 of the Project 1 2 3 Subtotal (2) Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 4 5 6 Subtotal (3) Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project 7 8 9 Subtotal GRAND TOTAL * Please have a seperate line item if the WB' financing percentage is different "l Please check these ref. through Client Connection 1-C GFDRR Disaster Risk Management Program for PNPM Urban III Project Summary Statement of Expenditures (Sum-SOE) for those NOT Subject to Prior Review Quarter : ... year ... TF No. :098817 Sheet No. : Item Disbursement Category Threshold Number of Country of Total Paid WB Amount of Average Amount No. for SP2D supplierl to Contractors/ Financing WB portion Exchange Charged Cat No. Description SOEs covered consultantl Expenditures % paid Rate to SA (USD eqv) training (GOI+IBRD+PPN) (USD eqv) (1) Kelurahan Grants under Part 2 of the Project (2) Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project (3) Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project GRAND TOTAL OL__ / Please have a seperate line item if the WB' financing percentage is different 1-C2 GFDRR Disaster Risk Management Program for PNPM Urban III Project Statement of Expenditures for those NOT Subject to Prior Review Quarter : ... year ... TF No. :098817 Sheet No.: 1 2 3a 3b 4 5 6 7 9 11 Item Disbursement Category Office Cross-Ref Date of Contract Supplier/ Contract Total Amount WB Amount of Exchange Amount No. Issuing SP2D Payment No. Contractor Value Paid to Financing WB portion Rate Charged Cat No. Description SP2D No. (SP2D) and Date Name (incl. Add) Contractor % paid Applied to SA (GOI+IBRD+PPN, (USD eqv) (1) Kelurahan Grants under Part 2 of the Project 2 3 Subtotal (2) Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 4 5 6 Subtotal (3) Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project 7 8 9 Subtotal GRAND TOTAL _I_ _ ___ */ Please have a seperate line item if the WB'financing percentage is different 1-D GFDRR Disaster Risk Management Program for PNPM Urban III Project Project Cash Forecast For the Quarter Ending mmlddlyyyy (a) (b) (c)=(a)+(b) (d) (e) GOI+WB GOI+WB Total Cash GOI WB WB Disbursement Category Cash Requirement Cash Requirement Requirement for Cash Requirement Cash Requirement Cash Requirement for Quarter ending for Quarter ending next two quarters next two quarters next two quarters next two quarters mm/dd/yyyy mm/dd/yyyy (six months) (six months) (six months) (six months) (DR)_(IDR) (IDR) (IDR) (IDR) (USD) 1 Kelurahan Grants under Part 2 of the Project 2 Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 3 Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project Non Bank Financed (Rupiah Murni) Total NOTE: Exchange rate applied = Rp................../ USD must reconcile with Form 1A Item 15 IFR-1 GFDRR Disaster Risk Management Program for PNPM Urban III Project Project Sources and Uses of Funds for the quarter ending dd/mm/yy currency: IDR Actual / i Planned Variance % Current Year-To Cumulative Current Year-To Cumulative Current Year-To Cumulative Quarter lii Date To-Date/iii Quarter lii Date To-Date/iii Quarter /lii Date To-Date/iii 1 2 3 4 5 6 7=1/4 8=2/5 9=3/6 Sources of Funds GOI ( Counterpart; RPMurni; Outstanding; SBUN) The World Bank Other Donor/lender Total Sources of Fund Uses of Funds (by Category) 1 Kelurahan Grants under Part 2 of the Project 2 Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 3 Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project Sub Total * Non Bank Financed (Rupiah Murni) Total Uses of Fund _ must reconcile with NOTE: Form IFR2 1 Sources of Fund: Actual: include WB portions and GOI counterpart funds Planned: to be completed with the appoved budget; especially for the current quarter this must be completed with the previous quarters cash forecast 2 Uses of Fund Actual: project expenditures by categories for the WB portions plus GOI counterpart funds Planned: "Year todate" to be completed with the appoved budget (DIPA); " Cummulative todate" to be completed with amount in PAD 3 "Current Quarter" covers the expenditures claimed to be eligible reported in the quarter 4 "Year to Date" covers accumulative expenditures during the year 5 "Cummulative to Date" covers expenditures since the beginning of the project until the current quarter 6 "Non Bank Financed" covers GOI expenditures related to the project other than the GOI counterpart funds IFR-2 GFDRR Disaster Risk Management Program for PNPM Urban III Project Project Uses of Funds by Category for the quarter ending ............ Expenditures in the Current Quarter Uses of Funds (by Category) */ GOI Others Outstan charged to Total counterpart Donor SBUN din WB Sp.Acc Rp Rp Rp Rp R 1 2 3 4 5 6 7 1 Kelurahan Grants under Part 2 of the Project 2 Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 3 Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project Non Bank Financed (Rupiah Murni) Total Uses of Fund Average Exchange rate: with Frm nFR5 must reconcile with Form 1A Expenditures in Year to Date Uses of Funds (by Category) *I GOI Others Outstan charged to Total counterpart Donor SBUN ding WB Sp.Acc Rp Rp Rp Rp Rp 8 9 10 11 12 13 14 1 Kelurahan Grants under Part 2 of the Project 2 Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 3 Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project Non Bank Financed (Rupiah Murni) Total Uses of Fund Average Exchange rate: , must reconcile with Form IFR1 Cumulativ Expenditures to Date Uses of Funds (by Category) */ GOI Others Outstan charged to Total counterpart Donor SBUN ding WB Sp.Acc Rp Rp Rp Rp Rp 15 16 17 18 19 20 21 1 Kelurahan Grants under Part 2 of the Project 2 Goods, consultants' services, training and workshops and incremental operating costs under Parts 1 and 3 of the Project 3 Goods, consultants' services, training and workshops and incremental operating costs under Parts 4 of the Project Non Bank Financed (Rupiah Murni) Total Uses of Fund Average Exchange rate: m reconcile with Form iFR1 *Please have a seperate line item if the WB' financing percentage is different For Internal Distribution Only Prepared by: Tony Shen (CTRLN) Cleared with and cc: Mariangeles Sabella (LEGES)/ Ria Nuri Dharmawan (EACIF) George Soraya (EASIS)