Document of The World Bank FOR OFFICIAL USE ONLY Report No: 74827-IQ RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF EMERGENCY BAGHDAD WATER SUPPLY AND SANITATION PROJECT TF054435 DECEMBER 3, 2004 IN THE AMOUNT OF US$65.0 MILLION TO THE MAYORALTY OF BAGHDAD February 20, 2013 Sustainable Development Department Middle East and North Africa Region ABBREVIATIONS AND ACRONYMS MOB Mayoralty of Baghdad PMT Project Management Team Regional Vice President: Inger Andersen Country Director: Ferid Belhaj Acting Sector Manager: Franck Bousquet Task Team Leader: Caroline van den Berg IRAQ EMERGENCY BAGHDAD WATER SUPPLY AND SANITATION PROJECT CONTENTS Page A. SUMMARY ................................................................................................................ 1 B. PROJECT STATUS.................................................................................................... 1 C. PROPOSED CHANGES ............................................................................................ 1 ANNEX 1: RESULTS FRAMEWORK AND MONITORING ......................................... 3 IRAQ EMERGENCY BAGHDAD WATER SUPPLY AND SANITATION PROJECT RESTRUCTURING PAPER A. SUMMARY 1. The proposed restructuring has been discussed and agreed upon with the Mayoralty of Baghdad (MOB) during the last supervision mission of November 11-13, 2012. This restructuring paper aims to reallocate the trust fund proceeds to facilitate project implementation. Indicators in the results framework will be revised to include the sector core indicators to better reflect Project outcomes. A letter establishing a Grace Period after Closing will be prepared as part of this restructuring package. B. PROJECT STATUS 2. Commitment stands at 99 percent of the total grant amount ($64.5 million out of $65 million). The slow progress in the past months can be mainly attributed to three factors: (i) nine works have been completed but contract closings are hindered by the excessive period it takes contractors to submit tax certificates; (ii) one work remains under implementation, but is close to completion; and (iii) progress on the delivery of the remaining two goods contracts was lower than originally anticipated. The MOB-PMT has taken steps to correct the situation and disbursements are to pick up in the next months. C. PROPOSED CHANGES Results/indicators 3. The current set of project indicators focuses mostly on infrastructure built rather than benefits of this infrastructure on water users, and does not contain sector core indicators. Indicators in the results framework will be revised as part of this restructuring to include relevant core sector indicators, and to shift the focus from outputs to outcomes, as described in Annex 1. There is no change in the Project Development Objectives. Disbursement arrangements 4. A letter establishing a Grace Period after Closing will be prepared to ensure that the Project will operate under a grace period of 4 months. Reallocation of proceeds 5. As of December 2012, 79 percent of funds (about $52 million) have been disbursed. A reallocation of proceeds is needed as the commitments in the works 1 category exceeds the original allocation of $40.40 million. As a result, the proposed reallocation is in the following manner: Category of Expenditure Allocation % of Financing Current Current Revised Current Revised Works 40,400,000 40,800,000 62.2% 62.8% Goods 19,050,000 19,000,000 29.3% 29.2% Consulting Services & 4,600,000 4,350,000 Training 7.1% 6.7% Operating Costs 850,000 850,000 1.3% 1.3% Unallocated 100,000 0 0.2% 0.0% Total 65,000,000 65,000,000 100% 100% 2 ANNEX 1: Results Framework and Monitoring Project Development Objective (PDO): The principal objective of the Project is to assist in restoring basic water supply and sanitation services for the capital city of Baghdad through: (a) the reconstruction and rehabilitation of existing priority networks and treatment facilities; and (b) providing capacity building support through training and technical assistance. D=Dropped Cumulative Target Values** Core PDO Level Results C=Continue Unit of Data Source/ Responsibility for N= New Baseline Frequency Indicators* Measure YR 1 YR 2 YR 3 2013 Methodology Data Collection R=Revised Increase in the quantity of D Cubic meter of treated water produced in the water per project cities day Improvement in the D percentage of water samples meeting the WHO biological and chemical standards in the areas affected by the project Quantity of sewage D collected (cubic meter per day) Number of households with N Number of 0 TBD Annual Aggregation of MOB households data from every access to rehabilitated water distribution component Number of people N Number 0 TBD Annual Aggregation of MOB benefiting from sewerage data from every extension or rehabilitation component works under the project Number of direct project N Number 0 TBD Annual Aggregation of MOB beneficiaries data from every component Direct project beneficiaries N % N/A TBD At the end of the Aggregation of MOB who are females project data from every component INTERMEDIATE RESULTS INDICATORS Water supply production R m3/day 350,000 500,000 Annual Aggregation of MOB (formerly data from every capacity PDO component indicator) Length of water supply N km 0 TBD Annual Aggregation of MOB network rehabilitated data from every component 3 Number of new sewerage N Number 0 TBD Annual Aggregation of MOB connections data from every component Number of rehabilitated N Number 0 TBD Annual Aggregation of MOB sewerage connections data from every component Length of new sewerage N km 0 TBD Annual Aggregation of MOB network installed data from every component Length of sewerage network N km 0 TBD Annual Aggregation of MOB rehabilitated data from every component No. of man-month training C Man- 0 300 Annual Aggregation of MOB months data from every provided through the project component Chlorine and chemical D process at Al-Karkh WTP rehabilitated (number of working units) 2B Pumping station D rehabilitated (thousand cubic meter of water pumped per day) Abu Nuwas raw water D pumping station rehabilitated (number of working pumps) Sadr City Sewerage network D (disaggregate rehabilitated (number of d into house connections indicators rehabilitated) (Sectors 10, above) 55a, 78,79,48 and 38) Zaafrania district water D (disaggregate network rehabilitated and d into upgraded with house indicators connections (length of pipes above) laid in km) (four packages) Project implementation is D progressing well with minimum deviation of the plan 4 5