Report No. 13620-BR PLOT PROGRAM TO CONSERVE THE BRZILIAN RAIN FOREST MEMORANDUM AND RECOMMENDATION OF THE DIRECTOR OF THE LATIN AMERICA AND THE CARIBBEAN DEPARTMENT I TO THE REGIONAL VICE PRESIDENT ON A PROPOSED GRANT FROM THE RAIN FOREST TRUST FUND IN AN AMOUNT EQUIVALENT TO US$ 20.0 MILLION TO THE FEDERATIVE REPUBLIC OF BRAZIL FOR A NATURAL RESOURCES POLICY PROJECT November 22, 1994 Pilot Program to Conserve the Brazilian Rain Forest Country Department I Latin America and the Caribbean Regional Office i CURRENCY EQUIVALENTS (As of September 30, 1994) Currency Unit : Real US$1.00 : R$0.85 R$1.00 0 US$1.17 WEIGHTS AND MEASURES The metric system is used throughout the report. GOVERNMENT OF BRAZIL FISCAL YEAR January 1 to December 31 .i ACRONYMS CEC - Commission of European Communities CEZEE - Ecological and Economic State Zoning Commission COEMA - State Environmental Council CONDEMA - Municipal Environmental Council CP - Project Commission within MMA ECU - European Currency Unit EIA - Environmental Impact Assessment FUNAI - National Indian Foundation G-7 - Group of Seven Countries (Canada, France, Germany, Italy, Japan, United Kingdom, and the United States) GT - Executing Entities Working Group GTTP - Permanent Technical Working Group of Amazon OEMAs GTZ - Deutsche Gesellschaft fur Technische Zusammenarbeit IAG - International Advisory Group IBAMA - Brazilian Institute of the Environment and of Renewable Natural Resources INCRA - National Institute for Colonization and Agrarian Reform KfW - Kreditanstalt fur Wiederaufbau .'vMMA - Ministry of the Environment and the Legal Amazon NEP - National Environmental Project (Loan no. 3173-BR) NGO - Non-governmental organization ODA - Overseas Development Administration OEMA - State Environmental Entity PA - Action Plan PEA - State Environmental Plan PED - Decentralized Execution Program under NEP PGA - State Environmental Management Plan POA - Annual Operating Plan RFT - Rain Forest Trust Fund RIMA - Environmental Impact Report SAE - Secretariat of Strategic Affairs of the Presidency of the Republic SOE - Statement of Expenditures ST - Project Technical Secretariat STN - Secretariat of the National Treasury UA - Support Unit within the OEMA a iii BRAZIL PLOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT TABLE OF CONTENTS GRANT AND PROJECT SUMMARY ...................... vi I. BACKGROUND .................................. 1 Environmental Issues in the Legal Amazon ............... 1 The Pilot Program to Conserve the Brazilian Rain Forest ... ... 2 Institutional Framework for Environmental Management in the Legal Amazon ............................ 6 Lessons Learned from Previous Bank Involvement .......... 11 II. THE PROJECT .................................. 12 Project Objectives .............................. 12 Rationale for RFT Funding ......................... 12 Project Description .............................. 13 Project Costs and Financing ........................ 16 Project Implementation, Organization and Management ... ..... 17 Executing Entities Project Coordination Responsibilities Procedures and Inter-institutional Coordination Qualification and Eligibility Criteria Operational Manual Reporting, Monitoring, Evaluation and Mid-term Review Implementation Schedule Supervision Legal Arrangements Procurement and Disbursements ...................... 26 Auditing .................................... 28 Project Sustainability ............................. 28 Project Benefits and Risks ......................... 29 Environmental Aspects ........................... 30 III. AGREEMENTS REACHED AND RECOMMENDATION ... ... 30 Assurances ..... ............................... 30 Conditions of Effectiveness ......................... 31 Conditions of Disbursement ........................ 31 Recommendation ............................... 32 SCHEDULE A-1 -- SUMMARY OF PROJECT COSTS BY COMPONENT ................................ 33 SCHEDULE A-2 -- FINANCING PLAN .................... 34 iv SCHEDULE A-3 -- SUMMARY OF PROJECT COSTS BY FINANCIER ................................. 35 SCHEDULE B-1 -- SUMMARY OF PROCUREMENT ARRANGEMENTS ............................. 37 SCHEDULE B-2 -- SUMMARY OF DISBURSEMENT ARRANGEMENTS ............................. 38 SCHEDULE C -- TIMETABLE OF KEY PROCESSING EVENTS .... 39 TECHNICAL ANNEXES .............................. 40 ANNEX 1: INSTITUTIONAL BASELINE DATA ON THE NINE AMAZON STATES .................... 41 ANNEX 2: PROJECT COSTS ...................... 53 ANNEX 3: IMPLEMENTATION SCHEDULE .... ........ 60 Physical Financial ANNEX 4: SUMMARY CONTENTS OF THE OPERATIONAL MANUAL ................... 68 ANNEX 5: PROJECT ORGANIZATION AND INSTITUTIONAL MECHANISMS AT FEDERAL AND STATE LEVELS .......................... 76 Project Coordination Structure at the State Level Project Coordination Structure at the Federal Level Project Procedures ANNEX 6: PERFORMANCE INDICATORS .... ......... 86 ANNEX 7: SUMMARY OF THREE EXAMPLES OF POSSIBLE INTEGRATED SUBPROJECTS ... ....... 95 ANNEX 8: SUMMARY TERMS OF REFERENCE FOR MAJOR STUDIES ........................ 100 ANNEX 9: REPORTS AND DOCUMENTS IN PROJECT FILES ................................ 108 Map: IBRD No. 26474 This report is based on the findings of an appraisal mission which visited Brazil in September 1994. Mission members were Carlos Bertao (LAlRF, v mission leader), Chris Diewald (LAIBR), Dominique Babelon (LAIPS), Coralie Bryant (LAlNR), Charles Dahan and Peter Loach (Consultants), Gustavo Rodrigues (LEGLA) and Alberto Ninio (LEGEN). The mission was joined by Hans Schuetz and Otto von Grotthuss (KfW), Eberhard Goll and Udo Lange (GTZ), Jose Vasconcelos (CEC), and John Palmer and Gordon Armstrong (ODA), who represented co-financing agencies. The Managing Division Chief and the Country Department Director are Stephen J. Ettinger and Gobind T. Nankani, respectively. vi BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT GRANT AND PROJECT SUMMARY Grantor: Rain Forest Trust Fund (RFI) Recipient: Federative Republic of Brazil Beneficiaries: * Nine States in the Legal Amazon (Acre, Amapa, Amazonas, Maranhao, Mato Grosso, Para, Rond6nia, Roraima and Tocantins) * Ministry of the Environment and the Legal Amazon * Secretariat of Strategic Affairs of the Presidency of the Republic * Federal and State entities involved in environmental management in the nine states Amount: US$ 20.0 million equivalent (RFT) Terms: Grant Fimancing Plan: Source TOTAL (US$ million equiv) Rain Forest Trust Fund (grant) 20.0 CEC (grant) 12.0 KfW (grant) 24.8 GTZ (technical cooperation)' 5.8 ODA (technical cooperation)2 5.0 Local Counterpart 11.4 Total 79.0 Economic Rate of Return: N/A Map: IBRD No. 26474 GTZ technical cooperation will be provided as a bilaterally associated project. 2 ODA technical cooperation will be provided as bilateral technical cooperation. MEMORANDUM AND RECOMMENDATION OF THE DIRECTOR OF THE LATIN AMERICA AND THE CARIBBEAN DEPARTMENT I TO THE REGIONAL VICE PRESIDENT ON A GRANT FROM THE PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST TO THE FEDERATIVE REPUBLIC OF BRAZIL FOR A NATURAL RESOURCES POLICY PROJECT 1. I submit for your approval the following memorandum and recommendation on a proposed grant from the Rain Forest Trust Fund (RFI) to the Federative Republic of Brazil for US$ 20.0 million. The grant would help finance a Natural Resources Policy Project, aimed at strengthening the capabilities of the environmental entities of the nine states located in the Legal Amazon region3 and at enhancing the integration among such entities, for a more efficient management of the environment at the local level, including zoning, monitoring, and control and enforcement activities. This project is part of the Pilot Program to Conserve the Brazilian Rain Forest, which is funded by the Group of Seven countries (Canada, France, Germany, Italy, Japan, United Kingdom, and the United States - G-7), the European Union, and the Netherlands, and administered by the World Bank. 1. BACKGROUND Environmental Issues in the Legal Amazon 2. The Brazilian Amazon is a region of great cultural, biological, economic and ecological diversity. It contains the largest extent of tropical rain forest in the world (almost 40% of the remaining tropical forests on the planet) and contributes 20% of the global river discharge into the world's oceans. Brazilian Amazon rain forests, with an area of approximately 3.3 million square kilometers, are a major carbon store, and their destruction (it is estimated that some 8% of the native forest has already been removed) would occasion the release of greenhouse gases that could affect the global climate. The rich forest and aquatic ecosystems contain a large share of the world's biological diversity and, while not fully known, the potential uses of Amazonian natural products are significant and increasing. Conserving the Amazon rain forest while using its resources sustainably would provide significant benefits both to Brazilians and to the global community. 3. Recent economic and demographic changes in the Amazon region, guided by inadequate technologies, are leading to rapid changes in land use that imply loss of natural diversity, environmental degradation and the threat 3 The Legal Amazon Region was established by Law no. 5.173, of October 27, 1966. It includes the states of Acre, AmapA, Amazonas, Parg, Rond6nia and Roraima and part of the states of Maranhao, Mato Grosso and Tocantins. 2 of climatic changes. Ignorance of the likely consequences of non-sustainable production systems for the environment has contributed to decisions in the past which have led to accelerated deforestation. Policy-making and investment decisions are constrained in situations in which information is lacking on the economic value of the forest, its products and the environmental services it provides. 4. Table 1 (pages 3-5) identifies the main environmental problems related to the use of natural resources in the Legal Amazon, more specifically its forests and biodiversity. It details the main destructive processes that have degraded these forests and biodiversity, and describes the main causes, types of resulting degradation, and areas of the region in which such degradation has occurred. 5. Over the past several years, the Brazilian Govemment has recognized that previous policies have led to short-term benefits but greater long-term costs. There is a growing public sentiment inside the country in favor of protecting the resources contained in its rain forests. The 1988 Federal Constitution outlined the decentralization of environmental management, but allowed for overlapping jurisdictions among the levels of government. By strengthening the capability of institutions responsible for environmental management in the region and by increasing transparency of environmental decision making, it should also be possible to elevate the level of public debate on salient policy issues. The Pilot Program to Conserve the Brazilian Rain Forest 6. The Pilot Program to Conserve the Brazilian Rain Forest was initiated at the request of the G-7 at the Houston Summit in 1990. Individual projects are financed by the RFT, which was established by Resolution 92-2 of the Bank's Executive Directors in March 1992, and by associated bilateral co- financing (all on grant terms). The Program is intended to support an integrated set of projects that will contribute to a reduction of the rate of deforestation in the Amazon rain forests while protecting biodiversity, reducing carbon emissions, and using forest resources sustainably. These projects fall within three broad sub-programs which aim to: (i) strengthen the capacity of the public sector to set and enforce sound environmental policy; (ii) improve the management of special protected areas; and (iii) increase research and the use of environmentally benign technologies in the Amazon. 7. For the first sub-program, the Brazilian government has proposed a set of activities for the institutional strengthening of the state environmental entities (OEMAs) of the nine states located in the Legal Amazon region, and for control and enforcement, monitoring and zoning. These were originally conceived of as four separate projects, but are now combined in the proposed project in order to build on the linkages among them and provide a more integrated approach to environmental management in the Amazon region. TABLE 1 Major Environmental Problems in the Legal Amazon: Types of Degradation, Their Main Causes, and Areas of Occurrence Problem Primary Types of Degradation Main Causes Areas of Occurrence 1) - Deforestation Loss of biodiversity Infrastructure construction, including Entire Legal Amazon region. through logging roads mostly near roads and urban a) clearing and burning Decapitalization of forest areas and along waterways both primarily for agricultural, Settlement, both official and private, of in flooded and dry land. livestock, and other Loss of soil fertility in the medium people on soils not appropriate for purposes, and and long term agriculture b) selective extraction for lumber. Soil erosion and sedimentation of Regulations requiring 'Improvements' for waterways validation of land titles Reduction of forest transpirational Land value appreciation through clearing capacity Financial and tax incentives for sawmills, Transfer of carbon into the agriculture and pasture lands atmosphere Political stimulation of squatting Air pollution. Weak state-level environmental management, control and enforcement Demand for charcoal, particularly for the steel industry. TABLE 1 Major Environmental Problems In the Legal Amazon: Types of Degradation, Their Main Causes, and Areas of Occurrence Problem Primary Types of Degradation Main Causes Areas of Occurrence 2) - Problems related to Erosion and sedimentation of Lack of job opportunities in the formal Many Amazon river sub-basins, mining waterways economy including the Tapaj6s and Madeira, and In the states of Contamination of topsoils and Lack of regulation, licensing, control, and Amazonas, Para, Amapa, and chemical (mercury, crankcase oil, enforcement of mining processes Mato Grosso etc.) pollution of waterways and food chain Insufficient control of illegal, wildcat Industrial mining In Para, precious metals trade (Garimpos) Amazonas, Amapa, and Increase In transmissible diseases Rondonia Low technology of informal mining Destruction of habitats and loss of operations. Acre is the only state without biodiversity. serious mining problems. TABLE 1 Major Environmental Problems In the Legal Amazon: Types of Degradation, Their Main Causes, and Areas of Occurrence Problem Primary Types of Degradation Main Causes Areas of Occurrence 3) Problems related to Endangering of species Attractive source of protein for rural and Fishing - entire Amazon basin fishing and hunting urban populations and coastal regions Loss of biodiversity and the knowledge of how ecosystem Lack of basic knowledge of exploited Hunting - entire Legal Amazon functions species, leading to a disregard for fishing region, including commercial seasons, little protection of reproduction hunting near urban areas. Stock reductions and loss of sites, and non-observance of minimum size protein available for the general regulations population. High rate of waste in commercial fishing due to inadequate fishing techniques Weak and inefficient enforcement infrastructure Conflicts of authority and regulations between state and federal jurisdictions. 6 Institutional Framework for Environmental Management in the Legal Amazon 8. Institutional Weaknesses. Effective environmental management in the nine Amazon states is seriously impeded by their weak environmental institutions and the lack of integration, within each state, between federal and state environmental institutions, as well as between environmental and development agencies. None of the states had an environmental law or an OEMA until the late 1980s. Only three of the nine states had federal forestry police in 1991. State zoning commissions did not exist until 1990-1991. In the past six years, serious efforts have been made to put these basic institutions in place. Yet much remains to be done to strengthen them so that they can assume more prominent roles in state policy determination. Their more powerful counterparts in productive sector secretariats are far more able to influence public investment choices and public policy. 9. The operational environmental agencies lack trained staff in the specializations required -- environmental economics, forestry, hydrology, biology, botany, and management, as well as core management systems -- financial management, personnel, and management information systems. Agency performance is constrained by managerial capacity gaps, little policy analysis capacity, limited equipment, and inadequate infrastructure for zoning, monitoring, and enforcement. Additionally, there are few members of the state judicial system with background in environmental law, and even fewer environmental prosecutors. 10. There are also serious gaps in communication and policy implementation, due mainly to the lack of integration of state and federal entities located within the states. While the 1988 Constitution envisioned greater decentralization, and outlined concurrent authority for the federal and state governments in several environmental subsectors, there were few institutional links to operationalize the Constitution. 11. Institutional Framework at the State-Level . The main principles and administrative mechanisms of a national environmental policy were first laid out in Law 6.938 of 1981, which created the National Environmental System and mechanisms at the federal level for integrated environmental management.. These principles were confirmed and substantially reinforced in the 1988 Constitution, which significantly increased the role of states and municipalities in environmental management. They were attributed, jointly with the Federal Government, responsibility for protecting the environment and renewable natural resources. Similarly, the Constitution established concurrent responsibility (competencia concorrente) between the states and the Federal Government to enact environmental legislation; the latter formulating general norms and minimum standards, and each state enacting supplemental legislation respecting federal minimum standards but suited to their particular situation. Table 2 (page 7) indicates the primary functions of the entities dealing with environmental management at the state level. 12. The nine states in the Legal Amazon have since structured themselves to varying degrees to fulfill their constitutional mandate. All of them have included environmental provisions in their Constitutions consistent with their obligations as spelled out in the Federal Constitution. However, only four states (Amazonas, Maranhao, Mato Grosso, and Tocantins) have enacted an environmental law and issued corresponding regulations or environmental codes. Two states (Acre and Rond6nia) have enacted an environmental law 7 TABLE 2 Environmental Management at the State Level: Entities and Their Primary Functions Erl P Pol Inter-tate M Control and Unersitieing IFormulation Coordination Enforcement OEMA _ COEMA _ .. _ jSecearimatofrPlanning l ||1s__..._ 1 |Forestry Police_ _ | IBAMA |FUNAI | | Federal Police 8 but not issued applicable regulations. In the remaining three states (Amapa, Para and Roraima) the environmental laws await State Congress approval. 13. Institutionally, all nine Amazon states have established State Environmental Councils (COEMAs). Most were recently created (generally since 1992), and, in five states (Amapa, Para, Rond6nia, Roraima and Tocantins), they are not functioning yet (their by-laws are still under discussion). Their composition and functions vary significantly from state to state, as specified in Table 5.0 of Annex 1. They are very important in establishing state environmental policies and norms, providing political support to OEMAs' actions, ensuring transparency and public access to information, and providing a forum for public debate. However, the frequency of meetings and relevance of their agendas had not been satisfactory (Table 5.0 of Annex 1). Their strengthening is an important objective of the project (para. 35). 14. State Zoning Commissions. State Zoning Commissions (CEZEEs) were established in all nine states in 1991 or early 1992 to plan, coordinate, supervise and evaluate zoning activities (only in Para and Tocantins did their creating decree specifically include among their functions that of suggesting how results from zoning activities should be used to orient state planning and government actions). Their membership usually consists of representatives of state sectoral secretariats. Only in Tocantins does its membership extend to the state university, and in Rond6nia to local offices of federal agencies and NGOs. Their secretariat and/or presidency is provided in six states by the state Secretariat of Planning, and in three states (MaranhAo, Amazonas and Roraima) by the state Secretariat of the Environment. CEZEEs were created under the leadership of the Secretariat of Strategic Affairs of the Presidency of the Republic (SAE), the federal agency in charge of planning, coordinating, supervising and evaluating zoning activities nationally, and of ensuring consistency in zoning methodologies. Many CEZEEs, however, have not met regularly since their creation (see Table 4.0 of Annex 1). Under the project, CEZEEs would plan, coordinate and supervise zoning activities carried out by their designated executing agency, with the support of SAE. 15. State Environmental Entities. All states have established OEMAs, which are charged with formulating (or proposing to COEMA) and executing the state environmental policies and monitoring, and controlling and enforcing environmental regulations. Their main activities thus include the elaboration of norms, issuance of licenses, review of environmental impact assessments and reports (EIAs/RIMAs), monitoring, control and enforcement, promotion of environmental awareness and education, and promotion and dissemination of environmentally friendly technologies. Although they have traditionally focussed on control of urban and industrial pollution, their responsibility also extends to protection of natural resources (including forests and fisheries), a task in which their activities are incipient but expanding, in light of a growing trend towards decentralization of such functions to the states. 16. OEMAs in the nine states exist in various legal forms (see Table 2.0 of Annex 1). In some states, they are an integral part of the state government apparatus as Environmental Secretariats (or Coordination), and as such have no legal personality and no administrative and financial autonomy (Amapa, Maranhao, Pard, Rond6nia, Roraima). In others (Acre, Amazonas), a small secretariat is in charge of formulating, approving, supervising and evaluating state environmental policy and formally issuing norms, but preparation and execution are entrusted to a decentralized agency with legal personality and administrative and financial autonomy (autarchy or foundation). In Mato Grosso, all functions are delegated to a foundation, accountable to a Secretary 9 of Environment; and in Tocantins, a foundation responds directly to the COEMA. While in principle foundations have advantages of being able to raise their own funds (proceeds from licensing fees, analysis of EIAs/RIMAs, fines, taxes, payments for services, etc..), in most cases these proceeds are either channelled to special restricted funds (e.g they cannot be used to pay for recurrent expenses), or allocated to other activities (such as science and technology). Sometimes they are so small that they only cover a minimal portion of the OEMAs' costs. All OEMAs, irrespective of their status, are thus overwhelmingly dependent on state budgets, which also considerably limits their ability to make their own decisions with respect to salary levels and hiring. 17. The OEMAs in the Amazon region suffer to varying degrees from a de-facto lack of administrative and financial autonomy, and a consequent lack of financial, physical and trained human resources. Many have high staff tumover because they are unable to offer permanent positions and reasonable salaries. They lack technical expertise, have weak internal systems, no strategic planning (essentially reacting to emergencies), and tend to work in isolation from other agencies (federal, municipal, NGOs, and other state government sectoral agencies). Their actions are also often impaired by a lack of enforceable state regulations. The project will support the strengthening of OEMAs in all these respects (para. 35). 18. There is a growing realization among OEMAs that they must also seek ways to strengthen themselves through alliances with other agencies. Among these other agencies, the most relevant traditionally are federal agencies such as the Brazilian Institute of the Environment and of Renewable Natural Resources (IBAMA), the National Indian Foundation (FUNAI) and the National Institute for Colonization and Agrarian Reform (INCRA), but also, increasingly, state special environmental prosecutors' offices (Curadorias de Meio Ambiente) and special forestry police (Batalhoes Florestais). Specialized Curadorias now exist in all states (except Roraima), though they are at various stages of development (Table 3.0 of Annex 1). By having an adequate capacity to initiate legal actions against offenders and impose criminal sanctions, they are potentially powerful allies of OEMAs as well as of the public. The forestry police (existent in five states, but only incipient in four of them, see Table 3.0 of Annex 1) are not capable of mobilizing considerable forces, which will be necessary as the enforcement of forestry regulations is decentralized to the states. The project includes their strengthening. 19. The Amazon is more urbanized than is generally realized. At municipal levels, OEMAs can leverage their actions by supporting the creation and strengthening of municipal environmental secretariats and councils (CONDEMAs) and by the establishment and strengthening of their offices outside the capital cities. In all institutions, there are significant needs for technical and other training, which will be supported under the project. The project will also promote integration among all environmental agents present in the states (including federal agencies) by financing integrated zoning, licensing, monitoring, control and enforcement subprojects (para. 36 (b)). 20. Although it is true that decentralization to the municipal level is essential for effective environmental management, the large size of the states in the Amazon region (the smallest state, Amapa, is almost five times the size of Belgium), with the consequent difficulties in communications and transportation, make it much more difficult to decentralize to the municipalities without first strengthening environmental institutions at the state level, specifically the OEMAs and the COEMAs. Because such strengthening is a 10 prerequisite for this decentralization as well as for increasing public participation in environmental protection, this project will give priority to the state level, while also encouraging a more effective presence of the OEMAs at the municipal level. 21. Zoning. Monitoring. and Control and Enforcement Issues. The objective of ecological-economic zoning is to provide the public sector with the information necessary to plan rational land occupation and more sustainable use of natural resources. It is accomplished through satellite and aerial imaging of the zoned area, and through biogeophysical (geological, hydrological, geomorphological, etc...) and socio-economic (sociological, economic, anthropological, etc...) studies of the area. Based on the recommendations of this research, land-use strategies are developed, public and private investments are planned, and conservation areas are identified, preserving the native populations and fragile ecosystems and rationalizing the use of natural resources. 22. Ecological-economic zoning, monitoring of the pattems and problems of environmental degradation, and enforcement of the norms embodied in legislation are three of the major functions to be performed in environmental management. In this regard, zoning is the most important tool which has become recently available due to the technological advances of the 1980s. The use of computerized geographic information systems to analyze satellite images can also extend monitoring and enforcement well beyond what was possible in the recent past. 23. The major technological breakthroughs of the mid-1980s in geographic information systems, satellite surveillance, and the use of the micro-computer for digitalized mapping are now being put in place in this part of Brazil. The contract to establish the Amazon Surveillance System (SIVAM) has just been awarded (not Bank-financed). During the implementation of the project, the Bank will be closely following the installation of SIVAM, in order to determine ways in which the information provided by the system can be used to enhance the environmental monitoring and enforcement capabilities of the Amazon states. 24. There are several intermediary steps, however, before real capacities can be built for using these advanced technologies. Primarily, agreements need to be reached on the processes, institutions, and people to be engaged in the processes. To date the concept of ecological-economic zoning in the Amazon remains essentially bio-physical, with only secondary attention to socio-economic data and its relationship to the incentives for the choices to be made. There is rarely a unique optimum land use, nor can technology alone identify one. Claiming that there is, and rushing to regulate (especially if it is without regard to incentives) without a review process to encourage ownership, only results in heightened conflict and enforcement stalemates. A regulation process based solely on restrictive legislation rarely works, even in industrialized countries with sophisticated capacity for enforcement. 25. Beyond ecological-economic zoning, however, there is other monitoring and enforcement work that needs strengthening: conformance with management plans submitted by sawmills and wood product manufacturers; licensing, fines, fee collections, and user charges; water and soil quality; and the impacts of illegal mining. The size and scale of the Amazonian states, and the dispersed nature of these problems, make the strengthening of these activities a considerable challenge. While IBAMA and the Forestry Police are on the front lines of enforcement, OEMAs also have their role to play in these 11 activities, as do the municipalities. Facilitating increased coordination among these different organizations is central to strengthening environmental management. Lessons Learned from Previous Bank Involvement 26. A number of lessons were learned from the implementation of the Bank-financed National Environmental Project (NEP) (Loan no. 3173-BR). First of all, project experience has shown that a thorough institutional analysis should be carried out early on in project implementation. Second, greater attention must be given to building capacity in the implementing agencies. In the NEP, IBAMA proved to be extremely weak in basic respects. Heavy reliance had to be placed on a project coordination unit and other technical experts (their presence reduced the capacity-building impact of the project). Another lesson learned is that this kind of project needs to be designed much more strategically and with greater simplicity. Future projects should build institutional capacity and carry out activities over a carefully designed sequence. 27. The recent restructuring of the NEP, with the allocation of sizable funds to the execution of decentralized projects (PED), represents an important experience for the Bank in lending to the environmental sector in Brazil since it incorporates lessons previously learned. It now includes sizable funds for which states compete with innovative projects involving new, decentralized approaches to environmental management, including the use of market-based incentives. The proposed project is following a similar approach in the integrated subprojects component. It is expected that, in the Amazon states, the program of PED and this project's activities will be complementary, with the proposed project focusing on the strengthening of state agencies and PED on municipalities and community associations. 28. Another germane Bank experience is with the Rond6nia and Mato Grosso Natural Resource Management Projects (Loan numbers 3444-BR and 3492-BR, respectively), currently under implementation. Both projects include separate institutional strengthening components targeted for, among other entities, their OEMAs. The Rond6nia activities concentrate on training and civil works, while the Mato Grosso activities are geared towards the purchase of essential equipment and civil works. Both projects also include programs for increasing decentralization of environmental policy to the municipal level and for zoning. Experience under these projects points to the need for strong environmental institutions at the state level in order to pursue sustainable development. It also highlights the critical importance of timely consultations with all segments of society (in particular conceming zoning activities). 29. Appraisal of these projects, discussions with Brazilian officials regarding the NEP, and sector work recently undertaken on decentralization have shown that institutional development must also include: (i) ending the historic isolation of OEMAs from other state agencies; and (ii) undertaking a broader approach to institutional development -- one which encompasses attention to the legal framework, the role of the OEMAs in decision making, the agencies' intemal managerial and organizational capacities, as well as the more traditional approach of providing equipment and training. 30. In addition, a 1992 paper entitled "Institutional Development in the Latin America and Caribbean Region: Lessons of Experience and 12 Recommendations for Improvement", emphasized: (i) basing project design on a thorough institutional needs assessment; (ii) establishing clear, monitorable performance indicators of project success; and (iii) carrying out an annual review as a setting for evaluating project performance and agreeing on necessary adjustments. II. THE PROJECT Project Objectives 31. The objectives of the project are to: (i) strengthen the policy analysis, regulatory and implementation capabilities of the entities dealing with environmental management at the state level, so they can develop and implement their key functions in an integrated manner; (ii) implement zoning, monitoring, and control and enforcement activities in key locations in the states, in order to mitigate the major environmental concerns in critical areas; and (iii) support the decentralization of environmental management from the federal to the state/municipal levels. 32. More specifically, the institutional and policy goals are to: (a) better integrate environmental entities at the state level with other sectoral entities, federal entities present in the states, NGOs, and the private sector, thus enhancing their capacity to set environmental policy and to intemalize environmental concems in investment decisions; (b) improve the intemal consistency of the legal framework for environmental policy, integrating it into other sectoral laws and policies; (c) raise public awareness of environmental problems through the participation of civil society in the major discussions affecting the sector and through the dissemination of information on environmental quality; (d) assure that the entities in charge of the protection of the environment have the basic capacity to implement and enforce instruments of environmental policy; (e) improve the financial and institutional sustainability of the 0EMAs; (f) enhance the capacity to respond quickly to specific demands that are considered a priority in terms of the protection of the environment; and (g) strengthen the zoning, monitoring, control and enforcement capabilities of the states in critical, priority locations. Rationale for RFi Funding 33. One of the objectives of the Bank's Country Assistance Strategy for Brazil, most recently discussed by the Board on June 29, 1993, is to identify ways to allow and encourage vigorous agricultural and industrial growth, while at the same time strengthening institutions and initiatives that will preserve the environment and reduce rural poverty. The Pilot Program's overall strategy is to demonstrate the feasibility of harmonizing economic and environmental objectives. Through support for integration of environmental management at the state level, and through strengthening the capacity of the main actors in such management, the proposed project would improve the essential institutional base needed for conservation of the Amazon rain forest along with the sustainable exploitation of its resources. As such, it is fully consistent both with the objectives of the Country Assistance Strategy as it applies to rural and rain forest areas, and with the objectives of the Pilot Program. Innovative aspects of the proposed project include its focus on joint management of the 13 environment (state and federal agencies working together), the strengthening of the OEMAs in a non-traditional fashion, their integration into policy and investment planning of the state governments, and the treatment of zoning, monitoring, and control and enforcement activities as an integrated set of actions involving several different entities at the local level. The proposed system of allocating a portion of project funds on a competitive basis, among both states and institutions, will create an incentive to the best performers, based on demonstrated capacity to effectively manage the environment. Project Description 34. The project would consist of two components: (i) institutional strengthening of the entities dealing with environmental management in the nine states in the Legal Amazon region; and (ii) zoning, monitoring, and control and enforcement activities in these states, through, inter alia, support for integrated subprojects which address a specific environmental problem within a limited geographic area of each state. The project would also finance MMA's administrative costs related specifically to the project, as well as technical assistance to the states for integrated subproject preparation (para. 41). 35. Part 1 of the project (39.4% of total project costs), would build the basic institutional foundation needed in every state for establishing a functional environmental protection system. This component will support the following activities common to the nine states: (a) improvement of the environmental policy framework, through: (i) the strengthening of strategic planning and policy analysis and implementation capacity for using existing instruments, such as review of EIAs-RIMAs, licensing and application of penalties, and for developing new policy instruments; and (ii) greater transparency of environmental decisions by promoting public access to environmental information and documents, such as RIMAs; (b) establishment of a process of needs assessment, priority setting, and strategic planning in each OEMA, through, inter alia: (i) the development of mechanisms to improve the financial sustainability of OEMAs, taking into account the potential application of natural resource taxes (royalties), pollution and user charges -- including recreational use of state conservation units; (ii) the identification of human resource needs and policies, including a system of personnel performance evaluation; (iii) the establishment of training programs for staff; and (iv) the improvement of the analytical capacity of laboratories and centers which process environmental data; (c) strengthening of state systems to address environmental issues, through, inter alia, (i) transforming the OEMAs into technical entities that would support improved state investment planning and design of state environmental legislation, through the holding of public workshops to discuss the design of environmental legislation compatible with existing legislation in other areas (consultants with knowledge of successful OEMAs outside the region would be hired to assist in this process); (ii) operationalizing an effective COEMA in each state, by revising, if necessary, its membership and scope of authority, by strengthening their ability to issue norms and standards, and by holding 14 workshops to discuss state environmental problems; (iii) supporting the establishment and functioning of Technical Commissions on State Environmental Legislation within COEMA (CTEL); (iv) strengthening forestry police; and (v) developing the state's capacity to adjudicate environmental disputes, through, for example, the training of judges and attorneys; and (d) enhancement of intrastate collaboration in solving environmental problems, through the broadening of the decision-making base of the COEMAs and CEZEEs, and the formation of GTs to coordinate the preparation of integrated subprojects, and of interstate collaboration, through the creation of a Permanent Technical Working Group of Amazon OEMAs (GTTP) for staff to exchange information on technical and regulatory issues related to the environment, and as a complement to the political working group of the region's environmental secretaries already in place. 36. Part 2 of the project (55.5% of total project costs) will consist of three components, as follows: (a) the strengthening of specialized staff of entities dealing with ecological-economic zoning, including the CEZEEs, the coordinating agencies of zoning works (Secretariats of Planning or of Environment), and other entities in charge of the execution of zoning activities in the states, through the provision of training, equipment and data for geo- processing and remote sensing; (b) the carrying out of a study on the territorial data of the Amazon region, which will consolidate the results of the "Environmental Diagnosis of the Legal Amazon", made by the Brazilian Institute of Geographics and Statistics (IBGE), and establish the system of territorial information of the region; (c) the carrying out of integrated sub-projects, in which: (i) the states will select critical areas with prospective environmental concerns; (ii) this area will be zoned (scale 1:250,000) so that the states can identify specific sub-areas ("hot spots") within the critical areas where an environmental concem is present4; (iii) a more detailed zoning of this sub-area will be done (scale depending on the size of the sub-area and the nature of the environmental concern); and (iv) monitoring, control and enforcement activities to mitigate the environmental concerns in the specific sub-area will be carried out. The project is expected to finance an average of three integrated subprojects per state, with an average subproject amount of US$1-2 million. Such integrated subprojects can include the selective strengthening of non-state entities for the execution of their activities under such subprojects, through the provision of specific training for their staff, equipment and vehicles, if needed. Annex 7 provides three examples of possible integrated subprojects dealing with sawmill, charcoal-based pig iron plant and mining activities; and 4 In the states of Acre, Mato Grosso and Rond6nia, all the territory of the states will be macro-zoned (scale 1:250,000) through, respectively, the KfW zoning project (as part of this project), and the Bank- financed Natural Resource Management Projects currently being carried out in the states of Mato Grosso and Rond6nia. Consequently, the zoning activities to be included in the subprojects for these states are only those in item (iii) of this paragraph. 15 (d) the carrying out of emergency enforcement activities in priority areas of the state (ad-hoc actions outside those programmed using the integrated subproject planning mechanisms) not to exceed US$250,000 per state over the life of the project. Such activities may include necessary related laboratory analysis and will have to be proposed by an executing entity and approved by the Project Commission (CP)5 within MMA and the Bank. 37. In order to become eligible to receive funds from sub-component (b) of Part 2, the states and the institutions will have to meet certain standards (paras. 56-59). Integrated subprojects will also be subject to technical analysis by CP, established within the Ministry of the Environment and of the Legal Amazon (MMA). Such analysis would be carried out in accordance with pre- determined criteria. All these criteria will be included in the Operational Manual (para. 62). 38. The objectives of an integrated subproject must be consistent with those of the Pilot Program, i.e., they should aim at reducing the rate of deforestation in the Legal Amazon by: furthering the sustainable use of natural resources (forest and water resources); protecting the forest and biodiversity; and reducing contributions to carbon emissions. Thus, activities which would qualify for financing could include control of: (a) deforestation and selective logging without adequate forest management; (b) fires in forest or contiguous areas; (c) placer mining (garimpo) activities (in particular, siltation and mercury pollution caused by these activities); (d) predatory fishing and hunting; and (e) industrial and urban pollution, but only when associated with: (i) the burning of wood or wood residues (charcoal manufacturing, wood burning in ceramics industry and burning of sawmill dust), which represents an indirect contribution of the forest to carbon emissions; (ii) threats to biodiversity in sensitive eco-systems in priority areas; or (iii) the need to secure the support and participation of local communities in priority areas. 39. The zoning activities under the integrated subprojects will provide the necessary tools to orient land occupation in the priority areas, taking into account the sustainable use and protection of its natural resources, thereby leading to an enhancement of the quality of life of the population in these areas. The methodology and process proposed for zoning activities under the integrated subprojects will be developed in workshops organized in the early stages of project implementation, and must include the required steps for consultation with affected groups and public hearings, the effective participation of local representatives of federal agencies, municipalities, organized civil society and affected populations in the various stages of zoning work (including socio-economic data collection and analysis of alternatives) and public hearings on zoning recommendations. 40. The significance of the effective enforcement of the zoning recommendations is such that, during negotiations, the representatives of the Recipient represented to the Bank that it is part of its policy in the Amazon region, and applicable to all entities controlled directly or indirectly by the Recipient, to take into account the ecological-economic zoning orientations of the Amazon states before making any productive investment in such states. 5 The CP comprises nine members: one representative from MMA (only with tie-breaking voting rights), one from SAE, one from IBAMA, three from the states (to rotate every. year) and three from NGOs. 16 Similar commitments will be required from the states, as specified in paragraph 70 (k) below. 41. Additionally, the project would finance project-specific administrative costs of MMA, which include support to the CP and to the MMA's Technical Secretariat (ST), as well as project monitoring and evaluation. This support represents the minimum external financing necessary for successful project implementation, since MMA is a recently established Ministry. This component will also finance technical assistance to the states, through MMA, for the preparation of integrated subprojects, when requested by the states. It represents 5.1 % of total project costs. Project Costs and Fimancing 42. Total project costs are estimated at US$79.0 million, including physical and price contingencies amounting to 10% of total project costs (except for the amount allocated to integrated subprojects under Part 2). Cost estimates are based on: (i) state proposals prepared using standard costs and a predefined project activities list; and (ii) budget limits agreed to for each component in the Pilot Program Progress Report of November 1991. These estimates are summarized in Schedule A-1 and detailed in Annex 2-A. Indicative cost estimates for each state and the regional level are in the project file. The financing plan, as a whole and by project component, is shown in Schedules A-2 and A-3. 43. The project would finance, inter alia, the provision of technical assistance and training, workshops and seminars, travel and per diem expenses (on a declining basis), the acquisition and use of equipment and vehicles, and some civil works on a modest scale, when required. All expenditures, except salaries of staff and taxes, would be eligible for financing. Only works of a value of less than US$200,000 in the aggregate per subproject would be eligible under the integrated subproject component (Part 2), so as to limit them to small-scale construction (such as construction of outposts and surveillance and monitoring installations). Eligible recurrent costs (such as supplies and materials) would be financed from external funds on a declining basis (para. 80). 44. The project would be financed with grants from the RFT (US$20.0 million), CEC (US$12.0 million equivalent), and the Kreditanstalt fur Wiederaufbau (KfW) (US$24.8 million equivalent), the technical assistance of the United Kingdom's Overseas Development Agency (ODA) (US$5.0 million equivalent), and the Germany's Deutsche Gesellschaft fur Technische Zusammenarbeit (GTZ) (US$5.8 million equivalent, in the form of a bilaterally associated project), and by counterpart funds (US$11.4 million equivalent). Technical assistance from ODA would be provided directly to the states for institutional strengthening, project implementation and integrated subprojects. Technical assistance from GTZ would be provided directly to three states (Acre, Para and Amazonas), and financial assistance from KfW would also be provided on a priority basis to these three states until the Mid- term Review, when this pre-allocation will be reviewed, taking into account the disbursements made. CEC funds would be disbursed through a Trust Fund expected to be established in the Bank in early 1995. If the amount of the CEC grant is more than US$12 million equivalent, the difference will be allocated to the carrying out of integrated subprojects under Part 2 of the project. To ensure sufficient funds to begin the proposed project, the 17 effectiveness of the RFT Grant Agreement will be dependent on the effectiveness of the CEC Grant Agreement (para. 93 (a)). The signing of the KfW Grant Agreement is expected by mid-1995, and its cross effectiveness with the RFT Grant Agreement is not proposed, because disbursements under the project in the first half of next year are expected to be very limited. Regarding the technical assistance of GTZ and ODA, in the case they are not formalized in due course, funds would be reallocated from the amounts allocated for integrated subprojects under Part 2 of the project (para. 36 (c)). Project Implementation, Organization and Management Executing Entities 45. The project would be executed by a number of participating entities designated by each state (see Annex 5). These would comprise: (a) for the institutional strengthening of state environmental agencies component (Part 1 of the project)), which, for the purposes of the component, include the State Environmental Secretariats, their executing entities (environmental foundations or other types of autonomous entities), the environmental sections of State Attorney General's Offices (Curadorias de Meio Ambiente), and the state Environmental Police forces; (b) for the strengthening of zoning institutions sub-component (under Part 2 of the Project), of entities dealing with ecological-economic zoning, including the CEZEEs, the coordinating agencies of zoning works (Secretariats of Planning or of Environment), and other entities in charge of the execution of zoning activities in the state (such as Universities), through the provision of training, equipment and data bases for geo-processing and remote sensing; and (c) for the integrated subprojects sub-component (under Part 2 of the Project), the executing entities designated to implement approved subprojects in the respective subproject proposals. These may include federal entities such as IBAMA, FUNAI, INCRA and the Federal Police, and state entities such as specialized forest police forces, or the regular state police. 46. Municipal entities and NGOs would not be direct recipients of grant funds. However, under specific subprojects, they may be indirect recipients if they are contracted as executing entities by a sponsoring entity as defined in items (a) through (c) above. Additionally, the project will promote the active involvement of NGOs in its implementation, through their participation in the CP (at the federal level) and the COEMAs and CEZEEs (at the state level). Subprojects under Part 2 which include the involvement of NGOs or municipalities in their preparation will be given greater weight when technically assessed, as specified in the Operational Manual. 18 Project Coordination Responsibilities 47. The following paragraphs describe the functions, membership and staffing of the various bodies involved in project coordination and management at the state, regional and federal levels. 48. At the state level, a Working Group (Grupo de Trabalho - GT) would be formed in each state to coordinate project implementation. The GT would be composed of one working-level representative of the OEMA (who chairs the Group) and one from each of the state entities and state-level offices of federal entities expected to carry out the project. The appointed representative of each entity to GT will be the person responsible for the coordination of the execution of the project in that entity. The composition of GT and the profile of its members will have to reflect the technical (not political) character of this group. GT would be in charge of: (i) coordinating the preparation of subprojects; (ii) reviewing executing entities' programs and budgets (Action Plans (PAs) and Annual Operating Programs (POAs)), and consolidating them; and (iii) preparing an annual evaluation report of the project. 49. A Support Unit (Unidade de Apoio - UA) will be established within the structure of each OEMA to serve as the executive secretariat to GT and to coordinate the OEMA's own activities under the project. This unit will be headed by a person designated by the OEMA from among its staff, and will comprise a full-time technical adviser (in the case of Acre, Amazonas and Para, the adviser will be provided under the technical assistance of GTZ) and two to three consultants (for financial, procurement and other aspects), all financed under the project. This unit would assist GT and executing agencies with: (a) the preparation of subproject proposals and other programming and budgeting documents; (b) the review and consolidation of these documents, and their verification for consistency with PEA/PGAs (see para. 54) and approved subprojects; and (c) the preparation of annual evaluation reports. The unit would also assist the executing agencies in the day-to-day operation of project-related systems (accounting, reporting, disbursements) and on procurement matters. This group would also be supported by specialist consultants provided (upon request) by ST, or hired directly by the states and financed under the project. 50. At the regional level, a Permanent Technical Working Group (Grupo de Trabalho Tecnico Perrnanente - GTTP) would be constituted, with representatives from each of the nine OEMAs, to: (a) identify and discuss common problems and approaches to resolving these problems; (b) discuss and propose uniform norms and procedures; and (c) review conflicts between environmental and other state-level or federal regulations and propose relevant changes. GTTP would be an important technical regional forum. It would meet initially every two months and would be supported by specialized ad hoc commissions and consultants financed under the project. 51. At the federal level, the responsibility for coordinating, managing, and supervising the project would be vested in CP and ST. Their responsibilities and composition are summarized below: (a) the CP would be responsible for: (i) approving consolidated state programs and annual budgetary allocations by states; (ii) approving integrated subproject proposals and "emergency activities"; (iii) recommending revisions to program norms, criteria and procedures; and (iv) commenting upon annual evaluation reports. It would consist 19 of: one representative of MMA (the Project Technical Secretary, who would preside over the CP but would have no voting rights); one representative of IBAMA; one representative of SAE; three representatives of the states, each appointed for one year on a rotating basis; and three representatives of NGOs (one from environmentalist groups, one from social groups and one from business groups). (b) ST would be established within MMA, under the Pilot Program Executive Secretariat (SEPP), to coordinate the project at the federal level. ST would be responsible for: (i) reviewing the five year PAs and POAs for consistency with Pilot Program rules (this function will become lighter as state GTs gain experience and knowledge of the project) and approving them; (ii) submitting changes to project norms and procedures to CP, then to the Bank and relevant donors for approval, and subsequently issuing them; (iii) preparing annual budgets and issuing budget rules to the states; (iv) assessing the technical, financial and institutional viability as well as the sustainability of integrated subprojects under Part 2 of the project, and submitting its recommendations and grading to CP for review and clearance, then to the Bank and relevant donors for approval; (v) consolidating POAs for submission to the Bank and relevant donors; (vi) preparing semi-annual progress reports on the project's physical and financial progress, the project's annual status report, organizing the project's Mid-term Review (see para. below), and preparing a project Implementation Completion Report at the end of the project; (vii) providing technical assistance to the states (upon demand) to help them prepare and review PAs, POAs and subprojects; (viii) ensuring that procurement, project accounting and reporting and disbursement are followed, and that standard systems have been installed and are functioning; and (ix) maintaining the Special Account and handling disbursements from the Trust Fund. ST would be staffed with ten professionals and three support staff, as shown in Annex 5, Graph 2, and would be supported by ad-hoc consultants (in particular for subproject appraisal) and technical personnel from other areas of MMA and SAE. 52. The establishment of CP and ST, the appointment of the project Technical Secretary and of the core staff of ST, as agreed, would be conditions of effectiveness for the Grant Agreement (para. 93 (b)). Assurances were obtained that MMA would subsequently maintain CP and ST adequately staffed at all times (para. 92 (a)). Procedures and Inter-institutional Coordination 53. Project management and coordination mechanisms are designed to promote decentralization at the state level in the design and adoption of priorities and programs, their coordination and integration, and their implementation, while maintaining adequate supervision and control mechanisms at the federal level and consistency with prevailing regulations governing transfers of federal funds. 54. The following procedures would apply to all project components: (a) during the first year of the project, each state OEMA would prepare an Environmental Plan (Plano Estadual Ambiental- PEA), a simplified document which would present a diagnostic of the main 20 environmental issues in the state, list priority themes and areas for attention, and propose critical areas within these themes and areas where the state should focus its efforts. The PEA will be approved by the respective COEMA, and the states which do not have functioning COEMAs would propose alternative review mechanisms for their PEA and subproject proposals. By the second half of the project, it is expected that each state would be able to prepare a more comprehensive document, an Environmental Management Plan (Plano de Gestao Ambiental-PGA), a strategic planning document which, in addition to articulating state environmental policies and priorities, would establish measurable objectives and define the means for achieving them (financial, institutional). A full PGA will be prepared and submitted to the respective COEMA in 1998. PEAs/PGAs will be prepared by the OEMA, in consultation with relevant sector secretariats and other state and federal agencies, and submitted to COEMA for review and approval. Proposed zoning priorities and programs would also be submitted to the respective CEZEE for review and approval; (b) integrated subproject proposals would be prepared by executing agencies under the leadership of GT, with the assistance of UA, approved by the COEMA and sent to ST. ST will carry out a technical assessment, in accordance with the criteria set forth in the Operational Manual. All subprojects would then be submitted for approval to the Bank and relevant donors; (c) each executing entity would prepare a five-year Action Plan (Plano de Acao - PA) reflecting its agreed participation in the project. This document would intemalize project planning, programming and budgeting into each entity's operations and programs. PAs would be revised annually. Each entity would also prepare a POA, which is an annual budget (including a breakdown of expenditures by type and a monthly physical and financial implementation schedule). PAs and POAs would be reviewed by GT for consistency with the priorities and programs established in the PEA/PGA and approved subprojects, and sent to ST for approval. During negotiations, assurances were obtained that MMA will send to the Bank, for its approval, by not later than September 30, 1995, the first PAs of the OEMAs for the activities under Part 1 of the project for calendar year 1996 (para. 92 (b)). Additionally, the Bank and relevant donors would review and approve the consolidated POA for each year, to be presented to the Bank by October 1 of each year. The approval by the Bank of the POA for calendar year 1995 would be a condition of effectiveness for the Grant Agreement, while the approval of subsequent POAs would be a condition of disbursement for each executing entity for each year (paras. 93 (c) and 94 (a)); and (d) semi-annual progress reports would be prepared by each executing entity and consolidated by ST before being sent to the Bank and relevant donors in the months of March and September of each year. Annual evaluation reports would be prepared by each GT/UA and sent to ST, the Bank, relevant donors and the COEMAs for information. 55. Activities to be financed during the first year of project implementation would not be subject to the above process. Rather, executing entities under the institutional strengthening component have been requested only to prepare POAs covering essential preliminary activities such as training, studies, and acquisition of basic data, as well as those required to support the creation of 21 coordinating bodies. These draft POAs were reviewed during negotiations and will be approved by ST and the Bank and later incorporated into the Sub-grant Agreements. 56. Thus, in this process, the states would have the exclusive responsibility for defining priorities in PEA/PGAs, and designing programs and integrated subprojects. The role of ST would be limited to a technical assessment of PAs of OEMAs and of integrated subprojects, ensuring that proposed activities and institutions meet the eligibility and qualification criteria established for the project, and that agreed monitoring, reporting, accounting, procurement and disbursement procedures are being followed. The role of ST in reviewing and approving PAs and POAs would be revisited during the Mid-term Review, based on the experience and capabilities developed at the state level. A decision will be taken at that point on whether approval authority for PAs and POAs could be further delegated. Proposed procedures and a timetable for major processing steps are detailed in Annex 5. Qualification and Eligibility Criteria 57. Eligibility of States. To access funds for integrated subprojects under Part 2 of the project, each state must: (a) have signed a Subsidiary Agreement with MIMA and that such Agreement has become effective; (b) have environmental legislation consistent with constitutional requirements, duly regulated; (c) demonstrate approved budget allocations to state environmental institutions (Secretarias de Meio Ambiente and their Executing Agency, Zoning institutions, and state environmental police) from domestic sources (i.e. excluding external funds) which show positive growth in real terms relative to the previous year; and (d) have complied with the applicable dated commitments listed in paragraph 70 below. 58. The funds for integrated subprojects, including the associated selective strengthening of non-state entities, will be disbursed on a first-come-first- served basis. Because of the different stages of development of environmental management in each of the nine states, and in order to allow sufficient time for the weaker states to develop acceptable subproject proposals, states will be exempt from conditions spelled out in items (b) and (c) of paragraph 57 above, for a period of two years (calendar years 1995 and 1996), but only up to US$1.5 million per state. Such limit will be included in the Operational Manual. On January 1, 1997 the uncommitted balance of state reserved funds will be available to all states, i.e., fully distributed among approved subprojects on a first-come, first-served basis. 59. Eligibility of Institutions. Each executing entity must have: (i) signed a Sub-grant Agreement with MMA (para. 70); (ii) demonstrated the technical capacity to implement its part of the integrated subproject; and (iii) demonstrated the availability of counterpart funds for the carrying out of such part in its budget. 22 60. Eligibility of Integrated Subprojects. In order to be eligible, Integrated Subprojects (Zoning, Monitoring, and Control and Enforcement activities) would need to: (i) be consistent with PEA/PGA and Pilot Program priorities, and have been recommended by COEMA; (ii) have been found by CP to be technically, financially and institutionally sound and sustainable; (iii) for zoning activities, be recommended by CFEZE, followed an agreed-upon methodology (including steps for consultation with affected groups and public hearings), and have the formal support of municipalities and local associations; and (iv) show satisfactory integration between licensing, zoning, monitoring, control and enforcement activities either already existing in the project areas or to be financed under the integrated subprojects. Eligible integrated subprojects would then be subject to a selection process similar to that designed under the PED under the NEP, i.e., subprojects will be assessed according to a series of criteria and assigned points on each one of these criteria. These criteria are listed in the Operational Manual (Annex 4). These points will then be added, and the project will be selected if the total number of points is equal or above 60% of the total of points. 61. In order to ensure a reasonable geographic dispersion of funds among the nine states, total disbursements for integrated subprojects under Part 2 will be limited to US$7.5 million per state. Such limit will be included in the Operational Manual. As indicated in para. 58 above, commitments for subprojects up to U$$1.5 million per state would not be subject to the proposed state eligibility criteria during the first two years of project execution, but will be subject to the institutional and subproject criteria. Operational Manual 62. Inter-institutional and project coordination mechanisms and procedures, qualification and eligibility criteria, subproject selection criteria as described in the above paragraphs, and reporting procedures described below would be incorporated in an Operational Manual for the project. The table of contents for this manual is presented in Annex 4. A draft of this manual was discussed at appraisal, and during negotiations agreement on its contents was reached. The issuance of the Operational Manual would be a condition of effectiveness for the Grant Agreement (para. 93 (d)). Assurances were obtained that the project would be carried out as specified in the Operational Manual (para. 92 (c)). Reporting, Monitoring, Evaluation and Mid-term Review 63. Each executing entity would be required to prepare semi-annual progress reports not later than March 31 and September 30 of each year, starting in September 1995, on the achievements of physical and financial targets as set out in their POAs, based on a standard format. These reports would be sent to the GTs and to ST for information, and consolidated twice a year by ST. This semi-annual progress report would be sent to the Bank and relevant donors. During negotiations, assurances were obtained that ST would hire a specialized consultant to: (i) by April 30, 1995, develop a project accounting and management information system, including financial and physical progress reporting and recording of procurement activities; and (ii) by September 30, 1995, install in MMA and in each OEMA such a system and train the relevant personnel (para. 92 (d)). 23 64. The first semi-annual progress report will include an evaluation of project progress during the preceding year, an analysis of successes, problems and proposed solutions, and an action plan detailing specific proposed actions to be taken in response to problems identified. These reports, and a summary prepared by ST, would be reviewed by CP before being circulated to the Bank, relevant donors and the International Advisory Group (IAG). A set of performance indicators for the institutional strengthening component is presented in Annex 6. During negotiations, assurances were obtained that the progress in project implementation would be measured, inter alia, by these indicators and by annual reviews to be conducted by the Bank, the relevant donors and MMA in the month of April of each year, beginning in 1996 (para. 92 (e)). For integrated subprojects, specific indicators will be developed and proposed as part of each subproject proposal, and progress would be measured against the agreed indicators. On the basis of these evaluation reports, ST will prepare an annual evaluation report, which will be submitted to the Bank, relevant donors and the Pilot Program Coordination Commission (CCPP). Also on these bases, proposals will be developed (at the initiative of ST and/or CP) to modify project procedures and criteria if necessary. These proposed amendments will be reviewed by, and agreed with, CP, the Bank, and relevant donors. 65. During negotiations, assurances were obtained that a Mid-term Review would be carried out not later than October 31, 1997 (para. 92 (f)) with the participation of the Bank, MMA, CP, the relevant donors and the states. Such a review will particularly focus on the: (i) review of revised five-year PAs of OEMAs; (ii) project coordination procedures and mechanisms and whether they can be further delegated to the states; (iii) subproject eligibility and selection criteria and financing limits; (iv) grant allocations by components; (v) allocations by states of funds from the various sources (RFT and co-financing sources); (vi) status of implementation of recommendations of institutional diagnostics undertaken during the first year; and (vii) functioning of the COEMAs and CEZEEs. By not later than August 31, 1997, ST will prepare a report, on the basis of which the Bank, ST and relevant donors will jointly carry out the Mid-term Review. Adjustments to the project scope, norms and criteria, procedures, institutional mechanisms, and allocation of funds will be introduced as necessary following this Mid-term Review. 66. Finally, within six months after project completion, an Implementation Completion Report will be prepared. This report will evaluate the success of the program in reaching its objectives, based on the agreed performance indicators. This report will be circulated for comments to CP, and then to the donors and the IAG. 67. During negotiations, assurances were obtained that project reporting and evaluation, and adjustments to project design, mechanisms and allocation of funds, would be done as set out in paras. 63-66 above (para. 92 (g)). Implementation Schedule 68. The Project would be implemented over a period of five years. The project is expected to be completed by December 31, 1999 and the closing date will be June 30, 2000. Estimated implementation and disbursement schedules for the total project period are presented in Annex 3-A and 3-B. These schedules are based on: (i) the timetable of process steps presented in Annex 5; (ii) the priority attached to each activity; (iii) the time necessary for 24 preparation of integrated subprojects; and (iv) the need for the executing agencies to progressively increase their financial participation and assure project financial sustainability. They also assume that the POA for 1995 will be presented and approved by the end of December 1994, and that the first subprojects under Part 2 will not be approved until 1996. Supervision 69. In view of the complexity of the proposed project, as well as the number of entities involved in its implementation in the Federal Government and in the nine states of the Amazon region, its supervision will be carried out through the Brasilia resident mission. About 75 staff-weeks per year have been allocated to the supervision of the proposed project, which represents three times the average allocation for similar projects. The supervision of this and other Pilot Program projects will be carried out by a unit located in the Brasffia resident mission. Additionally, KfW already has staff in Brasilia who will also be providing supervision support to the project. GTZ and CEC already expressed their intention to relocate one staff each for the same purposes in the near future. legal Arrangements '70. Subsidiary Agreements - MMA will sign with the nine states in the Amazon region Subsidiary Agreements (Convenios de Adesaol, through which the states would demonstrate their commitment to project objectives and principles and to follow established norms and procedures, provide required counterpart funds, establish the support unit (UA) within the OEMA, support the work of executing entities, and take recommendations of CEZEE into account in setting sectoral policies and planning public investments and activities. Specifically, any such agreement will incorporate covenants by which each state would undertake the following (para. 92 (h)): (a) designate their representatives to GTTP by June 30, 1995; (b) establish (or re-configure) their COEMAs with deliberative powers and adequate representation of civil society (at least one representative from NGOs of each environmental, business and social segments), and with the participation of representatives of the federal environmental entities at the state level -- by September 30, 1995 (before the second POAs are consolidated for submission to CP); (c) establish (or re-configure) their CEZEEs with deliberative powers, representation of the OEMA, and adequate representation of civil society (at least one representative from NGOs of each environmental, business and social segments), and with the participation of representatives of the federal environmental entities at the state level - by September 30, 1995 (before the second POAs are consolidated for submission to CP); (d) demonstrate the existence of a special prosecutor's office specialized in environmental matters (Curadorias de Meio Ambiente), by December 31, 1995; 25 (e) demonstrate that COEMA is functioning effectively, i.e. has met at least four times during the previous twelve months, with sufficient members to debate and decide on matters under its mandate, and that its decisions have been well publicized (publication in the Official Gazette and at least one newspaper of wide circulation), by September 30, 1996; (f) demonstrate that CEZEE is functioning effectively, i.e has met at least twice during the previous twelve months, with sufficient members to debate and decide on zoning matters, by September 30, 1996; (g) implement the agreed recommendations of the institutional diagnostic studies, in accordance with a timetable satisfactory to the Bank; (h) prepare a full PGA and have had it approved by COEMA by December 30, 1997; (i) demonstrate that all RIMAs and licenses granted are available for public reading in the OEMA and the relevant municipality (prefeitura); that all advertisements for public hearings are published in the Official Gazette as well as in at least one newspaper of wide circulation; and that a list of all fines and infractions has been made available to the public; and (j) ensure that all state productive investments (including those of the entities controlled directly or indirectly by the state) will take into account the recommendations of the respective CEZEE, regarding land use, ecological-economic zoning. 71. During negotiations, assurances were obtained that the signing of Subsidiary Agreements with at least five states would be a condition of effectiveness for the Grant Agreement (para. 93 (e)) and that, for the remaining states, signing of a Subsidiary Agreement would be a condition of disbursement under the project (para. 94 (b)). 72. Sub-grant Agreements - Each entity carrying out any part of the project will enter into a five-year Sub-grant Agreement (Convenio de Execuco) with MMA, which will include, in the case of entities carrying out integrated subprojects, inter alia, the establishment of coordination mechanisms among the entities in charge of implementing such integrated subprojects. Any such agreement will be amended with yearly supplements (Termos Aditivos) incorporating the respective approved POA. During negotiations, assurances were obtained that the signing of a Sub-grant Agreement would be a condition of disbursement for the respective executing entity, for expenditures under the project (para. 94 (c)). 73. Cooperation Agreement - MMA and SAE will enter into a cooperation agreement (Convenio de Cooperacao), establishing the coordination mechanisms between them relating to the carrying out of the activities described in paragraph 36 (a), (b) and (c). During negotiations, assurances were obtained that the signing of the Cooperation Agreement would be a condition of disbursement for expenditures under such activities (para. 94 (d)). 26 Procurement and Disbursements 74. The proposed procurement arrangements are summarized in Schedule B-1. During negotiations, assurances were obtained that all procurement for civil works and goods will be made in accordance with the Bank's Procurement Guidelines and using standard bidding documents issued by the Bank for International Competitive Bidding (ICB) and Limited International Bidding (LIB) and standard bidding documents agreed with the government of Brazil for Local Competitive Bidding (LCB) (para. 92 (i)). Civil works, laboratory equipment, computer equipment and software, transportation equipment and general office equipment, and technical assistance and other contracted services would be procured under the project. Procurement would be dispersed in time over the implementation period and would be carried out by a number of executing entities in different states. For these reasons, packaging of procurement across the states would be difficult, and, therefore, is not proposed. 75. Civil works under the project will be small and geographically dispersed. They include small-scale civil works necessary for the construction of laboratories and of OEMAs' offices in a few states, and for simple structures for monitoring and control facilities and outposts, under integrated subprojects. Since the largest single contract is not expected to exceed US$1.5 million, it is unlikely that foreign contractors would be interested. Procurement of works would therefore be carried out as follows: (i) contracts above US$300,000 would be procured on the basis of LCB procedures acceptable to the Bank for an estimated aggregated amount of US$1.0 million; (ii) contracts below US$300,000 would be procured using local shopping procedures (obtaining three quotations from any eligible contractor), up to an aggregate of US$1.0 million. Except for vehicles and computer equipment, contracts for goQds are not expected to exceed US$250,000 and therefore would probably not be large enough to attract foreign contractors. Contracts for goods, such as vehicles, computers and software, in excess of US$300,000 will be procured under LEB procedures, among manufacturers and importers who have established maintenance and technical assistance services in Brazil. Contracts for goods of US$300,000 or less, but above US$100,000, will be procured using LCB procedures acceptable to the Bank, up to an aggregate of US$4.0 million for equipment and US$1.5 million for supplies and materials. If contracts for supplies and materials were to be above US$300,000, they will be procured using ICB procedures. Contracts for goods costing US$100,000 or less, up to an aggregate amount of US$1.6 million, will be procured using local shopping procedures. Unless, otherwise agreed by the Bank, two steps bidding procedures will be used for the procurement of computers and the preparation of the materials necessary to carry out information, education and communication programs. 76. All ICB and LIB contracts for goods would be subject to prior Bank review of bidding documents, bid evaluation, award proposals and final contracts. The first LCB contract for goods and for works of each participating executing entity and all LCB for works contracts above US$500,000 would be subject also to prior Bank review of bidding documents, bid evaluation, award proposals and final contracts. Prior review is expected to cover about 50% of Bank-financed contracts for goods and works. 77. The selection and appointment of consultants for studies, workshops, training and technical assistance will follow the Bank Guidelines for the Use of Consultants by the World Bank Borrower and the World Bank Executing 27 Agency, dated August 1981 (para. 92 (j)). Contracts with consulting firms valued at US$100,000 or more would be subject to prior Bank review (Terms of Reference (TORs), letter of invitation, recommendation for award and proposed contract). For individual consultants, prior Bank review (TORs, qualifications and conditions of employment) would be required for contracts valued at US$50,000 or more. Below these limits, the Bank's prior review would apply only to TORs. These exceptions will not apply to critical assignments such as the definition of strategy and priorities for the harmonization of the legal framework. 78. Some discrepancies exist between the Bank's procurement guidelines for LCB and the Brazilian national procurement law. To avoid delays in procurement, special provisions will be included in the Grant Agreement to ensure that: (a) contracts are awarded to the bidder whose bid has been deternined to be the lowest evaluated bid, provided that the bid evaluation is based on factors that can be quantified objectively and the procedures for such quantification are disclosed clearly in the invitation to bid; (b) the invitation to bid is advertised for at least three consecutive days in a newspaper of wide circulation in Brazil; (c) the invitation to bid does not establish, for purpose of acceptance of bids, maximum and/or minimum amounts for the contract price; (d) the arrangements under the invitation to bid for joint ventures between Brazilian and foreign firms are approved in advance by the Bank in each case; and (e) the purchaser would not, without the Bank's prior approval, issue any change order under a contract which increases or decreases by more than 15 % the quantity of goods (and related services) without any change in the unit prices or terms and conditions of sale. 79. Since the experience in procurement of most executing agencies is limited, the UAs will include a procurement advisor to be trained under the project at the start of project implementation. In addition, the executing agencies will be assisted, as necessary by MMA and consultants. 80. Disbursements and Flow of Funds. The proposed grant, totalling US$20.0 million equivalent, would be disbursed over a period of five years. Five-year disbursement schedules for each project component are presented in Annex 3-C and summarized in Schedule B-2. First-year disbursement schedules for each state and for each project component can be found in the project files. This indicative disbursement schedule for the first year would be the basis for the preparation of 1995 POAs. The Bank will sign a Trust Fund Agreement with CEC to administer the CEC Trust Fund (US$12.0 million equivalent). RFT and CEC funds would be disbursed against 100% of eligible expenditures for works, goods and technical assistance (62.5 % RFT and 37.5 % CEC). Recurrent costs (except salaries) would also be financed under the project, but on a declining basis (90% in year 1, 75% in year 2, 50% in year 3, 30% in year 4 and 10% in year 5). The disbursement schedule for the RFT grant is shown in Schedule B-2. Funds or technical assistance services from KFW, ODA and GTZ would be disbursed under each agency's own procedures. 81. Grant funds would be disbursed against Statements of Expenditures (SOEs) for: (i) consultant services for firms whose contract value is below US$100,000 and consultant services for individuals whose contract value is below US$50,000; (ii) contracts for goods valued at less than US$100,000; (iii) works contracts below US$300,000; and (iv) all administrative expenses. Supporting documentation for such expenditures would not be submitted to the Bank but would be made available for inspection by Bank supervision 28 missions. All other disbursements will be made against fully documented withdrawal applications. 82. In order to ensure efficient and timely implementation of the project, Special Accounts for RFT and CEC funds, with initial deposits of US$2.0 million from each, would be established in US dollars at a commercial bank acceptable to the Bank. Any interest earned on the proceeds of the Special Accounts would be credited to the project, and would be kept in separate accounts. Replenishment of the Special Account would be supported by the required documentation or SOEs. 83. Because of the Bank-financed Natural Resource Management Projects currently being carried out in the states of Rond6nia and Mato Grosso (Loans Nos. 3444-BR - PLANAFLORO and 3492-BR - PRODEAGRO, respectively), which include institutional strengthening activities similar to those of this project, a condition of disbursement was incorporated into the Grant Agreement, to the effect that disbursements to these states under Part 1 of the project (except for regional activities) will be made only after the amounts allocated to similar activities under the two loans are fully committed (para. 94 (e)). Nevertheless, those states will be eligible to disburse for activities under Part 2 of the project, since such activities are complementary to those contemplated for zoning, monitoring, and control and enforcement under the two Bank loans. Auditing 84. Each executing entity would maintain separate accounts, identifying project expenditures by category of expenditure and financing source. In order to ensure uniformity in the presentation of project accounts and of SOEs, an accounting system and corresponding software will be developed and introduced in the accounting system of each entity, as part of the project management information system referred to in paragraph 63 above. ST staff (financial coordination) and Bank supervision missions would also perform periodic checks in each executing entity of the supporting documentation of SOEs, and, in addition to checking for eligibility, evidence of payment and delivery, would also verify that the goods, works and services purchased under the project are being used for the purposes of the project. 85. Each executing entity would keep adequate records to reflect its operations, resources and expenditures in respect to the project, in accordance with sound accounting principles applied consistently. The Special Account, and all other project accounts, would be audited annually by an independent auditor acceptable to the Bank, according to standards and procedures satisfactory to the Bank, and the auditor's report forwarded to the Bank within six months from the end of each fiscal year. SOEs would be verified periodically by the auditor on a sample basis in each executing agency several times a year. The terms of reference for the auditors will include inter-alia provision of a Management Letter, and a separate opinion on the use of the Special Account, the project accounts and SOEs. During negotiations, assurances were obtained in these respects (para. 92 (k)). 29 Project Sustainability 86. If the proposed project is successful, it will assure to a large degree its own sustainability. The OEMAs will be more fully integrated into policy and investment planning of the state government. They will have greater institutional capacity, and there will be more public support for environmental initiatives. Methods of improving the financial sustainability of state entities will also be developed, through fee assignment and cost recovery for services rendered. Additionally, the integration of all entities into the management of environmental problems at the state level will be an effective instrument to take the decentralization of environmental management in the Amazon region out of theory and into practice. Project Benefits and Risks 87. Benefits - The major benefit of the proposed project would be to provide the basic institutional capacity necessary for environmental and natural resource policy at the state level. The project would strengthen the capacity of OEMAs in the Legal Amazon region to a level comparable to the more developed states of Brazil, reducing the pressure on federal agencies to enforce policies in the region. Also, by providing for the integration of all entities responsible for environmental management at the state level, the project would provide the tools necessary to make effective the decentralization of environmental management included in the 1988 Federal Constitution. By increasing zoning activities, lands could be monitored and supervised for their use in resource-depleting activities. Zoning is expected to increasingly become not just a map-making exercise, but a practical guide to norms of zoning regulations. 88. Risks - There are several types of project risks, most of which can be reduced through effective project management. The main risks are: (i) the present institutional weakness of most of the nine participating OEMAs as well as the other federal and state institutions involved in environmental management at the state level; (ii) the very small budgetary allocations for environmental activities (Table 2.0 of Annex 1); (iii) the salary limitations imposed on public employees, causing a high staff turnover; (iv) the vested interest of part of the political elite and the business community at the state level in non-sustainable resource-depleting activities; (v) the novelty of the integration of state and federal entities jointly carrying out subprojects under Part 2 of the project; (vi) the tensions between state entities and federal entities at the state level created by the overlapping jurisdictions in environmental protection; and (vii) the change of government at both the federal and state levels which will coincide with the launching of the project. 89. To address these risks, the project will focus, especially in the critical years, on strengthening the state level environmental institutions. Increased budgetary provisions would be a condition for access to integrated subproject funding. Additionally, only those integrated subprojects of a size and complexity that are compatible with the capacity of each state will be financed. 90. There has been close cooperation between the federal and state agencies in the preparation of this project, and all nine of the outgoing state administrations have indicated their commitment to the project, such 30 commitment to be formalized through the signing of the Convenios de Adesao (para. 70). The "first-come-first-served" system for integrated subprojects will provide incentives for states to take the necessary steps (institutional, legislative, budgetary, etc...) to strengthen their environmental capabilities. Those states which fail to do so will not obtain access to this project funding. Envirommental Aspects 91. No significant negative environmental effects are expected. The project has a "C' classification for environmental assessment purposes. However, the environmental impact of the activities included in each subproject will be assessed before its approval, and remedial actions will be included if necessary. m. AGREEMENTS REACHED AND RECOMMENDATION Assurances 92. During negotiations, assurances were obtained that: a. MMA would maintain CP and ST adequately staffed at all times (para. 52); b. MMA would send to the Bank, for its approval, by not later than September 30, 1995, the PAs of the OEMAs for the activities under Part I of the project for calendar year 1996 (para. 54 (c)); c. the project would be carried out as specified in the Operational Manual (para. 62); d. ST would hire a specialized consultant to: (i) by April 30, 1995, develop a project accounting and management information system, including financial and physical progress reporting and recording of procurement activities; and (ii) by September 30, 1995, install in MMA and in each OEMA such a system and train the relevant personnel (para. 63); e. project progress will be monitored against the performance targets specified in Annex 6, and by annual reviews to be conducted in the month of April of each year, beginning in 1996 (para. 64); f. not later than October 31, 1997, a project Mid-term Review would be carried out, and not later than August 31, 1997, the Recipient would send to the Bank a project progress report, to serve as a basis for the review. Agreed adjustments would be made promptly afterwards (para. 65); g. project reporting, evaluation, and completion reports would be prepared and submitted to the Bank as specified (para 67); h. the Subsidiary Agreements would contain, inter alia, the covenants listed in paragraph 70; 31 i. the procurement of goods and works would be carried out in accordance with the Bank's guidelines (para. 74); j. consultants would be contracted in accordance with the Bank's guidelines for the hiring of consultants (para. 77); and k. (i) the project accounts will be audited annually by independent auditors acceptable to the Bank: (ii) the terms of reference for the auditors will include, inter alia, provision of a Management Letter, and a separate opinion on the use of the Special Account and SOEs for the project accounts and Special Accounts; and (iii) copies of the auditor's report will be sent to the Bank within six months of the end of each fiscal year (para. 85). Conditions of Effectiveness 93. The following were agreed as conditions of effectiveness: a. the CEC Grant Agreement would have been signed and become effective (para. 44); b. the CP and ST would have been established and the project Technical Secretary and the core staff of the ST would have been appointed (para. 52); c. the POA for calendar year 1995 would have been approved by the Bank (para. 54 (c)); d. the Operational Manual would have been issued (para. 62); and e. Subsidiary Agreements with at least five states would have been signed and become effective (para. 71). Conditions of Disbursement 94. The following were agreed as conditions of disbursement: a. for expenditures by any executing entity in any calendar year (except 1995), that the Bank would have approved the POA for the respective year (para. 54 (c)); b. for the remaining states not included in the condition of effectiveness mentioned in paragraph 93 (e), that the related Subsidiary Agreement would have been signed (para. 71); c. for expenditures to any executing entity under the project, that the related Sub-grant Agreement would have been signed (para. 72); d. for expenditures under the components described in paragraph 36 (a) and (b), that the Cooperation Agreement and the related Sub- grant Agreement would have been signed (para. 73); and e. for expenditures to the states of Rond6nia and Mato Grosso under Part 1 of the project (except for regional activities), until after the amounts allocated to similar activities under Loans nos. 3444-BR and 3492-BR, respectively, are fully committed (para. 83). 32 Recommendation 95. I am satisfied that the proposed RFT grant would comply with Resolution 92-2 of the Bank's Executive Directors, and recommend approval of the grant. Gobind T. Nankani Director, Country Department I Latin America and the Caribbean Region Attachments Washington, D.C. November 22, 1994 33 BRAZIL PILOT PROGRAM TO CONSERVE T}IE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT SCHEDULE A-1 Stunmary of Project Costs by Component (US$ million equivalent) % Foreign % of Component Local Foreign Total Exchange Base Cost Part 1 State Environmental Institutional Strewthenini 1. Organizational Capacity for Integrated Env. Management 13.4 1.7 15.1 11.1 20.0 2. Regularization of Legal Framework 0.6 - 0.6 - 0.8 3. Promotion of Environmental Awareness and Public Discussion 3.3 0.2 3.5 5.1 4.6 4. Organization of Env. Management Systems at Regional Level 0.6 - 0.6 - 0.9 5. Integrated State Planning, Project Implementation and Preparation of Integrated Subprojects' 3.4 4.0 7.4 53.8 9.8 6. Strengthening of COEMAs 1.1 - 1.1 - 1.4 Subtotal Part 1 22.4 5.9 28.3 20.7 37.5 Part 2 Zonin. Monitoring. Control and Enforcement (Z.M.C&E) i. Strengthening of Zoning Institutions 3.1 0.4 3.5 12.3 4.6 2. Z,M,C&E Integrated Subproject (including targeted strengthening of non-state institutions and tech. assist.) 30.2 7.6 37.8 20.0 50.1 3. Emergency Enforcement Activities 2.3 - 2.3 - 3.0 Subtotal Part 2 35.6 8.0 43.6 18.3 57.7 Part 3 Proiect Administration 1. Support to the Project Commission 0.6 - 0.6 - 0.8 2. Support to the Technical Secretariat 1.4 0.5 1.9 26.3 2.5 3. Technical Assistance to States 0.8 - 0.8 - 1.1 4. Project Evaluation 0.3 - 0.3 - 0.4 Subtotal Part 3 3.1 0.5 3.6 13.2 4.8 TOTAL BASE COSTS 61.1 14.4 75.5 18.9 100.0 Contingency (physical and price)2 3.5 TOTAL PROJECT COSTS 79.0 'Includes technical cooperation from ODA and GTZ 2 Total physical and price contingencies are estimated at 10% of Part 1, Part 2-2 and Part 3. 34 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT SCHEDULE A-2 Fnancing Plan (USS million equivalent) Million USS Observation Eguivalent Fmiancial CooDeration German Govemment financial cooperation 6.2 Up to DM10 million through separate bilateral for Zoning in Acre through KFW/GTZ agreement. KfW appraised this project in July 1994. German Govermment financial cooperation 18.6 DM30.0 million as parallel co-financing. through KfW for institutional strengthening (Part 1) and Z,M,C&E integrated subprojects (Part 2) with priority for the states of Acre, Para and Amazonas CEC 12.0 US$12 million equivalent as joint co-financing through a Trust Fund to be established in the Bank. Rain Forest Trust Fund 20.0 Local Counterpart 11.4 US$6 million equivalent (R$5.4 million) as counterpart of the Brazilian Government and about US$5.7 million as counterpart of the states' executing entities. Technical Cooneration German Government technical cooperation 5.8 Estimated at up to DM3.5 million for Acre, for institutional strengthening, Z,M,C&E DM3.0 million for Para and DM2.8 million for integrated subprojects, and for project Amazonas. implementation through GTZ in Acre, Pari and Amazonas. UK Government technical cooperation for 5.0 institutional strengthening, project implementation, and Z,M,C&E integrated subprojects through ODA in the states of Tocantins, Roraima, Amapa and Maranhao. Total 79.0 35 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT SCHEDULE A-3 Summary of Project Costs by Financier (USS million equivalent) UK German Local Component RFT CEC Gov. Goveriment Counterpart Total (5) ODA KfW GTZ (T.C) (F.Q tT. Part 1 State Environmental Institutional StrenztheninE (4) 1. Organizational Capacity for Integrated 4.18 2.51 2.23 6.14 1.51 16.57 Environmental Management (1) 2. Regularization of Legal Framework 0.17 0.10 0.34 0.06 0.67 3. Promotion of Environmental Awareness and 1.22 0.73 1.50 0.34 3.79 Public Discussion 4. Organization of Environmental Management 0.27 0.16 0.22 0.07 0.72 System at Regional Level 5. Integrated State Planning, Project 1.23 0.74 2.17 0.90 2.40 0.74 8.18 Coordination and Preparation of Subprojects (2) 6. Strengthening of COEMAs 0.33 0.20 0.53 0.11 1.17 TOTAL PART 1 7.40 4.44 4.40 9.63 2.40 2.83 31.10 Part 2 Zoning. Monitornir, Control and Enforcenment (Z.M.C&E) 1. Strengthening of Zoning Institutions (3) 1.39 0.83 1.28 0.35 3.85 2. Z,M,C&E Integrated Subprojects (including 8.92 5.35 0.57 13.13 3.20 6.63 37.80 targeted strengthening of non-state institutions and technical assistance) 3. Emergency Enforcement Activities 0.53 0.32 0.03 0.78 0.20 0.39 2.25 TOTAL PART 2 10.84 6.50 0.60 15.19 3.40 7.37 43.90 Part 3 Proiect Administration 1. Support to the Project Commission 0.25 0.24 0.21 0.70 2. Support to the Technical Secretariat 0.73 0.74 0.63 2.10 3. Technical Assistance to States 0.32 0.31 0.27 0.90 4. Project Evaluation 0.10 0.11 0.09 0.30 TOTAL PART 3 1.40 1.40 1.20 4.00 TOTAL 20.00 12.00 5.00 24.80 5.80 11.40 79.00 36 Notes: (1) The technical cooperation of ODA includes technical assistance for human resources training in the states of Maranhao, Tocantins, Amapa and Roraima and at the regional level. (2) The technical cooperation of GTZ includes technical assistance for integrated state planning, project implementation and preparation of subprojects in the states of Acre, Para* and Amazonas. The technical cooperation of ODA includes technical assistance, during four years, for integrated state planning, project implementation and preparation of integrated subprojects in the states of Maranhao, Tocantins, Amapa and RorAima. (3) The financial cooperation of KfW includes US$150,000 million for institutional strengthening for zoning activities in Acre. (4) The financial cooperation of KfW includes the equivalent of US$6.2 million (DM10 million) for zoning in Acre and US$18.6 million (DM30 million) for institutional strengthening and integrated subprojects which will be disbursed with priority given to the states of ParsS, Acre and Amazonas (at Mid-term Review, this priority will be revisited). (5) The local counterpart funds include US$6 million equivalent (R$5. I million) from the Brazilian Government and US$5.7 million equivalent (R$4.8 million) from the states' executing entities. T.C. Technical Cooperation F.C. Financial Cooperation 37 BRAZJL PILOT PROGRAM TO CONSERVE THE BRAZIUAN RAIN FOREST NATURAL RESOURCES POUCY PROJECT SCHEDULE B-1 Summary of Procurement Arrangements (USS million equivalent) Category of Expenditure Procurement Method Total LCB Other e/ NBF Cost Works 1.0 1.0 0.5 2.5 (0.6) (0.7) (1.3) Equipment 4.0 4.3 7.0 15.3 (2.5) (2.7) (5.2) Supplies and Materials a/ 1.5 0.6 4.1 6.2 (0.9) (0.4) (1.3) Technical Services (Consulting. Training) bl 11.5 23.1 34.6 (7.2) (7.2) Other Services c/ 2.0 1.4 4.8 8.2 (1.2) (0.9) (2.1) Travel and Per Diems d/ 4.7 7.5 12.2 (2.9) (2.9) Total 8.5 23.5 47.0 79.0 (5.2) (14.8) (20.0) LIB Umited Intemational Bidding LCB Local Competitive Bidding NBF includes procurement financed by GOB and KIW under own procedures and technical assistance through ODA and GTZ. a/ Supplies include operating costs such as fax and phone costs b/ Contracting of consultants and studies in accordance with Bank Guidelines c/ Other services include services such as rentals for training and workshops, maintenance of equipment, TV and radio programs. d/ Reimbursement of expenditures e/ Other include procurement of equipment through LIB for an estimated total amount of US$3.3 million and an RFT-financed of US$2.0 million Notes Numbers in parenthesis reflect RFT financing. Totals represent total estimated costs per category, including contingencies as per Annex 2B \ESCHEDBI 38 BRAZ3L PILOT PROGRAM TO CONSERVE THE BRADLIAN RAIN FOREST NATURAL RESOURCES POUCY PROJECT SCHEDULE B-2 Summary of Disbursenmnt Arrangements (US$ million equiiaent) ITEM and German Gov. U.K Gov. Local % of Total Cost Categorv of Expenditures RFT CEC KIW GTZ ODA Countwroirt Expenditure (1.A) (trA) CMI Works 1.25 0.75 0.50 RFT 50.0% 2.50 CEC 30.0% KIW 20.0% Equipment 5.19 3.11 7.00 RFT 33.9% 15.30 CEC 20.3% KWW 45.8% Supplies and Materkls 1.31 0.79 2.70 1.40 RFT 21.2% 6.20 CEC 12.7% KWW 43.5% Local 22.6% Techrncal Servies (Consulting, 7.19 4.31 8.60 5.80 5.00 3.70 RFT 20.7% 34.60 Training) CEC 12.5% KW & GTZ 41.6% ODA 14.5% Local 10.7% Other Services 2.12 1.28 3.00 1.80 RFT 25.9% 8.20 CEC 15.6% KIW 36.6% Local 21.9% Trave and Per Diems 2.94 1.76 3.00 4.50 RFT 24.1% 12.20 CEC 14.4% W(W 24.6% Local 36.9% Total 20.00 12.00 24.80 5.80 5.00 11.40 79.00 DISBURSEMENT SCHEDULES Bank Fiscal Year 1996 1997 1998 1999 2000 Toal Total Disbusemnert Schedule - ArnuaI * US$ million 6.9 22.2 24.2 16.8 8.9 79.00 *%ofTotal 8.7% 28.1% 30.6% 21.3% 11.3% 100.0% - Cumulative (US$ Million) 6.9 29.1 53.3 70.1 79.0 RFT Disbursement Schedule - Annual * USS million 1.7 5.6 6.1 4.3 2.3 20.0 *%ofTotal 8.7% 28.1% 30.6% 21.3% 11.3% 100.0% - Cumulative (US$ Million) 1.7 7.3 13.4 17.7 20.0 \MSCHEB2.WL 39 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT SCHEDULE C TIMETABLE OF KEY PROCESSING EVENTS Time taken to prepare: 10 months (November 1993 to August 1994) Prepared by: * Nine States in the Legal Amazon (Acre, Amapd, Amazonas, Maranhao, Mato Grosso, Para, Rond6nia, Roraima and Tocantins) * Ministry of the Environment and the Legal Amazon * Secretariat of Strategic Affairs of the Presidency of the Republic * Federal and State entities involved in environmental management in the nine states First Bank mission: November 1993 Appraisal Mission Departure: September 1994 Date of Negotiations: November 1994 Planned Date of Effectiveness: March 1995 Suummary Supervision Plan: Missions are planned for 2-3 month intervals to supervise progress closely. Technical expertise will include ecologist, economist, zoning specialist, financial analyst, and institutional development specialist. One mission each year will be designed as an annual review. The annual review for the third year will be the Project Mid-term Review. During such missions, project implementation and monitoring and evaluation procedures will be assessed and changes introduced, as necessary. Supervision staff will mainly be located in the Brasilia office. 40 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT TECHNICAL ANNEXES ANNEX 1: INSTITUTIONAL BASELINE DATA ON THE NINE AMAZON STATES ANNEX 2: PROJECT COSTS ANNEX 3: IMPLEMENTATION SCHEDULE: - Physical - Financial ANNEX 4: SUMMARY CONTENTS OF THE OPERATIONAL MANUAL ANNEX 5: PROJECT ORGANIZATION AND INSTITUTIONAL MECHANISMS AT FEDERAL AND STATE LEVELS: - Project Coordination Structure at the State Level - Project Coordination Structure at the Federal Level - Project Procedures ANNEX 6: PERFORMANCE INDICATORS ANNEX 7: SUMMARY OF THREE EXAMPLES OF POSSIBLE INTEGRATED SUBPROJECTS ANNEX 8: SUMMARY TERMS OF REFERENCE FOR MAJOR STUDIES ANNEX 9: REPORTS AND DOCUMENTS IN PROJECT FILES Map: IBRD No. 26474 I 41 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 1: INSTITUTIONAL BASELINE DATA ON THE NINE AMAZON STATES TABLES 1.0: General Informnation on the Legal Amazon States 2.0: Baseline Data on OEMAs: Institutional and Budgetary 2.1: Baseline Data on OEMAs: Personnel 2.2: Baseline Data on OEMAs: Personnel Salaries 2.3: Baseline Data on OEMAs: Professional Staff 2.4: Baseline Data on OEMAs: Infrastructure 2.5: Baseline Data on OEMAs: Monitoring Capacity 3.0: Baseline Data on Control and Enforcement Institutions and Activities 4.0: Baseline Data on Zoning Institutions and Activities 5.0: Baseline Data on State Environmental Councils (COEMAs) 6.0: Baseline Data on Municipal Environmental Councils (CONDEMAs) 42 TABLE 1.0: General Information on the Legal Amazon States (1993) Total Area No f SaeConservation State Conservation STATE (kr21 Population uNo. of State CAes (km2) Areas as a Portion of (km2) Municipalities Areas (km2J ~Total Area Acre 152,589 417,165 12 24,633 16.1% Amapa 140,276 288,690 9 21,748 15.5% Amazonas 1,565,785 2,102,901 62 29,092 1.9% Maranhao 328,663 4,929,029 136 70,112 21.3% Mato Grosso 881,001 2,022,524 95 43,001 4.9% Para 1,249,382 5,181,570 105 31,589 2.5% RondOnia 243,044 1,130,874 23 40,037 16.5% Roraima 230,104 215,950 8 44,235 19.2% Tocantins 286,944 920,116 79 7,783 2.7% Sources: 1) MMA, March 1994; 2) Associacio Brasiloira do Entidades do Meio Amnbiente (ABEMA), 'Diagn6stico Institucional dos Orgios Estaduais do Moio Ambionto no Brasil.' 1993. TABLE 2.0: Baseline Data on OEMAs: Institutional and Budgetary INSTITUTIONAL BUDGET 1. Institutional Nature 2. Legal 3. Date 1. Allocationa 2. Allocations 3. OEMA Budget as 4. Propoeed 6. Portion of Total Nature Established 11992, 1993, lannual average, % of State Budget OEMA Budget for State Revenues STATE 19941 IUS}*) 1992-94) IUS$) lannual average. 1990 1995 (US$) coming from Federal 931 Gov. (19901 Environmental Institute of Acre Self- 420,000 Acre JIMAC) Governing 1986 449,423 654.808 0.26% 3,575,564 80.1% (IMAC) ~~~Body 1.095,000 State Coordination of the Executive 1,230,000 Amaph 1989 1,280,000 1,323,333 0.27% 2,103,071 91.1% Environment ICEMAI Law 1,480,000 Institute of Natural Resource and Self- 1,772.469 Amazonas Environmental Development Governing 1989 960,893 2,253,364 0.25% 5,434,598 27.6% (IMA) Body 4,026,730 1,881,754 J Meranhgo State Secretariat of the Executive 1987 496.705 1,096,348 0.16% 4,219,989 64.7% Environment ISEMA) Law 910,584 Mato Grosso State Environmental Foundation Foundation in 18 3.231,219 Mato Grosso (FEMA) Poubdlticn Law 1987 2,231,723 3,435,600 0.36% n/a 25.6% (FEMA) Public Law ~~~~4,843.858 State Secretariat of Science, Executive 893,862 Para Technology, end the Low 1988 445,604 670.742 0.07% 3,760,000 45.3% Environment (SECTAM) 672,760 State Secretariat of Executive 1,166,827 Rondonla Environmental Development 1991 2,567,678 2,268,168 0.33% nla 62.9% ISEDAM Law 3,070,000 State Secretariat of the Executive 63,562 Rorelma Environment, Interior and Justice Law 1992 127,098 191,053 0.06% n/a 92.9% (SEMAIJUS) Law 382,500 Tocantins Nature Foundation Foundation In 706,289 Tocantins INATURATINS) Privte In 1991 785,377 797.215 0.23% 1,511,628 70.9% SNoTurcesNS) Privet. Lrovided byOEAttcils99;1MA1900,000 Sources: 1) Information provided by CEMA officials, 1994; 2) MMA, 1994; 3) Rosenblatt, 1994; 4) ABEMA, 1993. US$1 -RII.85. TABLE 2.1: Baseline Data on OEMAs: Personnel (1994) 1. Staff Size 2. Statutory 3. Seconded 4. Special Appointments and STATE Positions Personnel Temporary Personnel Acre 113 22 15 76 Amapi 33 0 33 0 Amazonas 342 142 16 177 Maranhgo 225 53 150 22 Mato Grosso 135 45 17 73 Pars 211 28 86 97 Rond8nia 244 22 30 192 Roraima 22 0 12 10 Tocantins 55 0 39 16 Source: MMA, 1994. 4, TABLE 2.2: Baseline Data on OEMAs: Personnel Salaries (US$, monthly, 1994) 1. Gross __ 2. Base STATE 1.1 Mean 1.2 Minimum 1.3 Maximum 2.1 Mean 2.2 Minimum 2.3 Maximum Acre 855 545 2,651 355' 131 1.569 Amapa 841 343 1,760 n/a n/a n/a Amazonas 332 115 716 108 67 145 Maranh5o 311 134 1,128 154 87 617 Mato Grosso 405 221 883 305 103 507 Para 483 299 1,433* 281 90 614* Rondonia 490 172 1,228 254 69 779 Roraima 476 285 611 411 285 586 Tocantins 365 218 583 264*0 84** 469** Sources: 1) Information provided by OEMA officials, 1994; 2) MMA. 1994. 'excluding top two salaries. `US$1 =R$.85. TABLE 2.3: Baseline Data on OEMAs: Professional Staff (1994) 1. Adminietratore 2. Attorneye 3. Agronomists 4. Biologits 5. Civil 6. Forestry 7. Chemical B. Geographers 9. Economists 10. Other 11. Total STATE Engineer. Engineer Engineer. - Acre 1 1 7 8 2 1 0 4 2 17 43 Amapa 2 1 B 2 0 3 1 4 3 a 32 Amazonas 13 11 14 5 6 4 1 5 4 25 88 Maranhlo 1 6 7 3 6 2 16 13 3 15 72 Mato Grosso 4 4 6 2 8 5 3 2 5 14 53 Par 3 5 12 9 B 16 21 4 3 28 119 Rond6nla 2 3 12 3 3 16 1 6 0 17 63 Roraima n/a n/a 2 1 n/a 1 nla n/a n/a 1 n/a Tocantins 0 1 5 0 0 2 1 0 1 5 15 Sources: 11 Information provided by OEMA officials, 1994; 21 MMA, 1994. TABLE 2.4: Baseline Data on OEMAs: Infrastructure 1. No. of Offices 2. Treneportation 3. Communication 4. Computer Outeide Vehicles (autos boatel Equipment (19911 Equipment Headquarters 119901 3.1. Telephone Lines 3.2. Telex 3.3. Fax 3.4. Radio units 4. 1. No. of PC. 4.2. No. of 4.3. (Headquarters : Reglonell (Headquarterm (Headquarters (Headquarter. UNIX Terminal. Networks STATE Reglonal) Reglonal) Regional) Acre 0 9 2 3; 0 1; 0 1;0 2; 0 8 0 0 Amep6 0 11 1 6;0 1 0 1:;o 0:0 14 0 Novell Amazonas 4 4 3 12;0 1 0 1 0 0;0 9 0 0 Maranh6o 5 5 5 13 :0 0: 0 3; 0 3 :9 10 32 0 MatoGroeso 0 4;0 4;0 1;0 1: 0 0:0 11 0 0 Pat6 0 7 0 6;0 0:0 1 0 0;0 23 0 Novell Rond6nia 0 2 0 8; 12 2 0 1 0 0:0 8 0 Amplus 14) Rorelma 0 8 0 8 1 0 0 1 0 1:0 7 0 Novell 121 Tocentins 1 10 0 2;0 0:0 1 0 0;0 0 0 0 Sources: 1) Information provided by OEMA officials, 1994: 2) MMA. 1994: 31 ABEMA, 1993. 46 TABLE 2.5: Baseline Data on OEMAs: Monitoring Capacity 1. Laboratory 2. Remote 3. Vehicles for STATE Facilities (water, air, Sensoring Monitoring son) Equipment in State water - yes Acre air - no yes 1 soil - no water - no Amapa air - no yes 1 soil - no water - yes Amazonas air - no yes 0 soil - no water - yes Maranhao air - yes yes 0 soil - no water - yes Mato Grosso air - no yes 1 soil - no water - yes Para air - yes yes 8 soil - no water - no Rondonia air - no yes 59 soil - no Roraima nla n/a n/a water - yes Tocantins air- no yes 7 soil - ves I Sources: 1) Information provided by OEMA officials, 1994; 2) ABEMA. 1993. TABLE 3.0: Baseline Data on Control and Enforcement Institutions and Activities 1. Number of 2. Number of 3. Forestry 3a. Date 3b. 3c. Number of Offices 4. State Environmental Environmental Battalions (or Established Number of Outside Headquarters & Attorneys Impact Studies Impact Reports similar) Soldiers Their Location Offices for STATE (EMAsI Received In (RIMAs) Issued In Environmental 1994 (Jan. - Sept.) 1994 (Jan.-Sept.) Cases Acre 1 1 no yes Amapa 0 0 no yes Amazonas 0 2 no . . . . . yes Maranhgo 7 5 yes April 1991 150 0 yes 3 Mato Grosso 3 3 yes December 1989 175 (Caceres, Pocone & Barra do yes Bugres) 2 Para 5 8 yes October 1993 120 (Curion6polis & Eldorado in yes Carajas) 12 (Costa Marques, Ariquemes, Machadinho, Jaru, Alta RondOnia 0 0 yes January 1986 130 do Oeste, Pimenta Bueno, yes Vilhena, Cabixi, Calama, Guajara-Mirim & Sao Miguel do Guapore) Roraima n/a n/a no . . . . no Tocantins 4 4 yes July 1994 150 0 yes Sources: 1) Information provided by OEMA officials, 1994; 2) ABEMA, 1993. TABLE 4.0: Baseline Data on Zoning Institutions and Activities ._____________ ________________ State Zoning Commissions (CEZEEs) 1. Date 2. Secretariat 3. State 4. Number of 6. MembershIp 6. Number of Established Provided By Executing Members in Composition Meetings Held In 1994 STATE Agency for CEZEE (Jan.-Sept.) Zoning Acre August 1991 Secretariat of Planning Secretariat of 7 State Government 3 Planning Sectoral Agencies Amapa December 1991 Secretariat of Planning Secretariat of 112 State Government Sereanniatgo Sectofal Agencies Amazonas July 1991 Secretariat of Secretariat of 7 State Government O Environment Planning Sectoral Agenciee Maranhglo October 1991 Secretariat of UEMA IMeranhoao State Government O Environment State University) Sectoral Agencies Secretariat of State Government Mato Grosso August 1991 Secretariat of Planning Planning Sectoral Agencies Secretariat of Parhl February 1992 Environment (under IDESP 7 State Government O Para February 1992 presidency of Sectoral Agencies Secretariat of Planning) State end Federal Rondonia January 1992 Secretariat of Planning n/a 13 Agencies, and NGOs Special Executive Technical Secretariat Special Executive State Government Roraima November 1991 (coordinated by Technical 7 Agencies I Secretariat of Secretariat Environment) State Government Tocantins April 1992 Secretariat of Planning n/a 7 Agencies end State 3 University of Tocantins Sources: 1) Information provided by OEMA officials, 1994; 2) MMA, 1994. 51 TABLE 5.0: Baseline Data on State Environmental Councils (COEMAs) 1. Date 2. Number of 3. Number of Members 4. Functions 5. Status STATE Established Meetings (Jan.-Sept. and Composition 1994) 19 Also for science and Acre January 1992 3 (Majority representation from technology; deliberative, By -laws state government agencies) nonmative, and recourse approved Consultative only; limited to 22 studying and proposing state By-laws not Amapi November 1990 3 (Majority representation from environmental policies; draft approved yet state government agencies) law proposed to expand functions 13 (Majority representation from Also for science and teocnology; By-lws Amazonas June 1985 0 state government agencies; consultative and deliberative; approved presided over and appointed by not normative Govemor) 32 (Equal representation from Deliberative, normative. and By-laws Maranhao April 1992 2 state government, D recourse approved environmental NGOs, and civil society) recuro_eprve 27 (Equal representation from Mato Grosso July 1979 9 state governrment, Consultative, deliberacuve, By-laws environmental NGOs, and civil normatve, and recourse approved ______________________society) 13 ParS July 1993 10 (Majority representation from Deliberative, nornmative, and By-laws not civil society and environmental recourse approved yet NGOs) 9 Deliberative, normative, Rondonia December 1993 0 (Majority representation from deliberative, and recourse; By-laws not rstate government agencies) cannot revise licensing approved yet state goernment gencies)decisions ______ Roraima December 1992 nla (Majority representation from Consultative and limited By-laws not civil society) deliberatve approved yet Tocantins June 1994 0 (Majority representation from Delberatve, nouratve, end By-laws not state government agencies) recourse approved yet Sources: 1) Information provided by OEMA officials, 1994; 2) ABEMA, 1993. 52 TABLE 6.0: Baseline Data on Municipal Environmental Councils (CONDEMAs) STATE 1. Number in 2. Location 3. Date First CONDEMA STATE State Established Acre 1 Rio Branco August 1994 Amapa 1 Macapa July 1993 Amazonas Manaus November 1993 Alc6ntara, Carolina, Caxias, Maranhao 8 Cumurua, Timon, Barra do September 1991 Corda, G. Aranha. & Mirador Barra do Bugres, Cuiabi, Mato Grosso 6 Jaciara, Rondon6polis, Dom June 1989 Aquino, & Caceres Para o Rondonia 0 . Roraima 1 nia nil Tocantins 0 Sources: 1) Information provided by OEMA officials, 1994; 2) ABEMA, 1993. 53 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILLAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 2: PROJECT COSTS t Annex 2A - Page I BRAZIL NATURAL RESOURCES POLICY PROJECT PROJECT COST SUMMARY % of Subtotal Total Total Cost PART 1 - Strenthening of State Environnental Institutions 1. Improvinp Orqanizational CaPacity for Integrated Environmental Management 1.1 Improving Management and Organizational Systems (OEMAs) 1,491,818 1.2 Strengthening Human Resources (OEMAs, Attorney General's Offices and other State Entities) 5,181,818 1.3 Installing Improved Interconnected Environmental Information Systems 3,150,682 1.4 Providing Complementary Infrastructure and Equipment 5,237,484 Subtotal - Improving Organizational Capacitv 15,061,802 19.1% 2. _arrnonizing and Adiusting the Legal Framework 359 0.8% 3. Promoting Environmental Awareness, Dissemination of Knowledge and Public Discussion 3.1 Carrying out Information, Education and Communication Programs 2,138,555 3.2 Increasing Public Participation in Public Hearings for Licensing, and in Monitoring and Enforcement 720,000 3.3 Supporting Dissemination of, and Establishing Demand for, New Scientific and Technological Knowledge 585,365 Subtotal- Environmental Awareness 3,443,920 4.4% 4. Orcanization of Environmental Management System at Regional Level 4.1 Defining GTPP Operations 3,818 4.2 Establishment of GTPP 568,182 4.3 Regional Support to Environmental Management 81,364 Subtotal- Regional SIGEA Organization 653,364 0.8% 5. Creating Conditions for Inteqrated State Planning and Subproiects Preparation 5.1 Establishing and Maintaining Working Groups and Support Units 1,354,545 5.2 Technical Assistance to State Entities for State Planning, Project Coordination and Subproject Preparation 6,081,823 Subtotal-Inteqrated State Planning, Project Coordiantion and Subprojects Preparation 7,436,368 9.4% 6. Strengthening of COEMAs 1065582 1.3% TOTAL COST PART 1 -STRENGTHENING OF STATE ENVIRONMENTAL ENTITIES 28,271.395 35.8% Annex 2A - Page 2 BRAZIL NATURAL RESOURCES POLICY PROJECT PROJECT COST SUMMARY % of Subtotal Total Total Cost PART 2 - Zoning. Monitoring. Control and Enforcement (Z,M.C&E) 1. Special Activities In Support of Intearated Environmental Management 1.1 Stengthening for Zoning Activities 1,041,000 1.2 Geoprocessing and Remote Sensing 2,148,545 1.3 Study on the Territorial Data of the Amazon Region 315,455 Subtotal- Environmental Management Support Activities 3,505,00 4.4% 2. Z.M.C&E Integrated Subpro*ects (Including Targeted Strengthening to non State Entities and Technical Assistance) 37,795.966 47.8% Ln 3. Emergency Enforcernent Activities 2,250,000 2.8% @ TOTAL PART 2 - Z,M.C&E 43.55096 55.1% PART 3 - Prolect Administration 1. Support to Project Comission 636,364 2. Support to Technical Secretariat 1,909,091 3. Technical Support Requested by States 818,182 4. Project Evaluation 272,727 TOTAL PART 3 - PROJECT ADMINISTRATION 3.636,364 4.6% TOTAL PROJECT BASE COST 75.458,724 95.5% Contingencies \1 3,541,276 4.5% TOTAL PROJECT COSTS 79,000,W0 100.0% \1 Total physical and price contingencies are estimated at 10% of Part 1, Part 2-2 and Part 3. %APCOSTAA.WKI - 10/20/1994 Annex 28 - Page I BRADIL - NATURAL RESOURCE POLICY DEVELOPMENT PROJECT PROJECT COST ESTIMATEs SuppP!s Technkil Other Toli Per Olenm Trawe A Ł Materils Sere Sere Wors Egpmr PART 1 - STRENGTHENING OF STATE ENVIRONMENTAL ENTmES 1 ImproIng Organiation Capacty for lrnwatrd Evironmenbl Maragemnt 1.1 Improving Management and Organiation System (OEMAWA 1.1. 1 Diagnostics and Proposed Alternatlves 486,000 79,000 22,500 20,000 364,500 1 1. 2 Regional Workshops 225,000 38,250 9,000 9,000 168,750 1.1.3 3mplementation 930,000 95,500 27,000 20,000 511.500 188,000 00,000 SubtdIl 1.641 21Z7 a500 49,0 1,044,7 166U000 90,0W 1.2 Strenad ring Human Reores (OEMAI. and Attomey Generals Offlies and othr Sbate Entiieas 1.2.1 Assessing Existing Resources and Needs and Preparation of Trafinng Programs 700,W00 92,000 21.000 27,000 560,000 1.2.2 Carrying out Trakinng Programs 4,760,000 1,205,867 780,000 414,133 2,380,000 1.2.3 Establshing Project Management Systems (Systems and Trairing) 240,000 43,200 25.200 27,000 94,600 50,000 Subtabl 5,W000 1,341,067 600,W 448,133 3034,000 5000o 1.3 Insal8ns Improved Intrconnected Environmenal Inrfrmation Sys atn 1.3.1 Updating Diagnosties 129,000 25,000 9,0W0 5,000 90,000 ON 132 Training of Personnel 190,802 20.882 6,0o0 21,000 151,920 1.3.3 Developing Softvares 127,000 127,000 1.3.4 Purchase of Equlpmert and Soflvare 1,538,073 53,000 1,485,073 1.3.5 nstalatlon 312.747 312,747 1.3.0 Data AcqulsItion 148,000 148,000 1.3.7 Operaton and Maintenance 1,011,129 202,226 450,000 250,903 108,W0 SubohaI 3,4656751 45882 1650W0 281.226 8!920 S03,50 1,741,073 1.4 Pr ovlng Complemenbwy InrEaakucturu *nd Equipment 1.4.1 Buildings (Headquarter$ Regional and Other Field Offices) 11,494,00 1,494,000 1.4.2 Laboratorles 1,247,587 21,000 9,800 499,035 70,000 847,752 1.4.3 Vehkiles (Automobles, Boats and Equipmert) 2,479,749 2,479,749 1.4.4 Other Equlpmeri 539,8906 539,896 Sthitotal S761.232 21 W0 9,800 49935 700W0 1,~494,03 317397 SUBTOTAL- IMPROVING ORGANIZATIONAL CAPACrTY 160567.983 1,020 ga9g6W 1,297,39 40270 74 14 1494,W 65.54470 Z Humonizina and Adhusting the Legal Framuwork 2.1.1 Carrying out Detaled Legal DIagnosties 52.580 6,880 10.000 700 35,000 2.1.2 DefinIng Strategy and Priorities 44,000 4,100 3,500 1,400 35,000 2.1.3 EstabIlsmient and Maintenance of CTELs 244,727 21,600 18.900 31,500 102,727 70.000 2.1.4 Workshops andSpecificTralning 330,088 58.000 28,000 50,088 140,000 56,000 Subotea 071t395 88_580 60_ U, !3 312,7Z7 5e1o 70,000 SUBTOTAL-HARMONIZING a ADJUSTING LEGAL FRAMEWORK 671.395 U 0 0400 !83 312.727 56000 70?.w Annex 2B - Pags 2 BRAZIL - NATURAL RESOURCE POLICY DEVELOPMENT PROJECT PROJECT COST ESTIMATES Supp Technica Other Total Per Dhems TraVel A Mterials mv swice works . gf4merb 3. PromotIng Environrnental vrcnesV_ Dissemination of Knowledge, and Public Discusdion 3.1 C wryjn out Informatbn, Education and Communiclalon Programs 3. 1.1 Planting Campaigns 81,590 23.997 4,000 7,000 45.693 3.1.2 Contracting Preparation 291,800 291,800 3.1.3 Execution 1.979,020 1,979,020 Subtotbl .Z352410 23807 4S000 7000 3374 1.979020 3.2 Incresing Public_Parciation In Pubi Hwrigs for Lkensin a*nd hi Monitoring and Erdorcement 3.2.1 Information Disclosure to Interested Entkies 691,400 72,000 33,800 172,850 70,000 307,950 35.000 3.2.2 other Activitim 100,600 50,000 50,800 Subtotl 7O 7O 6O 222_&50 700 358_550 385,0 3.3 Supporlna DIssemination dA and Etablashlng Demand for New Scientific and Tehnmoloocal Knowledge 3.3.1 EstablilNng Demand for Scierific Resewach 143,770 33,800 14,000 8,670 87,500 3.3.2 AcqubsHion of Technical-Sclentlic Information for Problem Solhvig 156,828 156.828 3.3.3 Production of Publications and Information Dissemination 343,304 72,000 33,600 50,311 70,000 117,393 Subtal 0 0 toW 47,60 5awt1 314,328 117393 SUBTOTAL - ENVIRONMENTAL AWARENESS 3.788312 20167 88s1e 2sa18311 72121 24549 35, 4. OCrgnkation of Ernvlonm.ntdl Manag Mnt System at Regonkl Level 4.1 Deflhn GTGP Oprations 4.1.1 DefhiingGTP By-lawsandStructLre 4,200 4,200 Subtobl 4200 4-200 4.2 Estabblshig GTTP 4.2.1 Approving By-laws and Strutcur 21,000 3,700 8,750 850 9,700 4.2.2 Preparing Calendair and Work provam 4.2.3 EstablishmentofGTTP 604,000 153,000 238,500 12,500 20,000 Subtal 026, t 7W 245 250 t50 2e9 4.3 Reginal Support kr Environmenta!l Mnagement 4.3.1 TrfininginEstmblishmentolPrioritiesforEnviornmentadManagemert 35,500 19.60 14,200 300 1,400 4.3.2 Training in Regional Environmental Management Project Design 35,500 19,600 14,200 300 1,400 4.3.3 Definitlon and Execution of Studies on Pubilc Regulaton and Policies 18,500 2,000 1,500 15,000 Subtdal 8o,s5 41,2 290 600 17 8 SUBTOTAL- REGIONAL SIGEA ORGANIZATION 71.700 1197WO 275.1t0 13.950 23t1 Annex 2B - Page 3 BRAZIL - NATURAL RESOURCE POLICY DEVELOPMIENT PROJECT PROJECT COST ESTIMATES Supp2R Tochnkil Other Total Per Diem Travel a Matrib Seve SaMoa. Works Equlpmenbs 5. Creating Condrtions for InteWrated State Planning and Integrated Subprolecb Prepation 5.1 Establishing and Maintaining Working Groups IGTA) and Support Unfs 5. 1.1 Establishement of GTs and Support Units 35.000 14,000 21,000 5.1.2 GTs and Support Units Operations 1,455,000 252,000 252,000 863.000 210,000 78,000 Subotal t 490 2 252000 25ooo o 2 ?000 _90W0 5.2 Technical Assistance to State Entities for Pkminn9 Prolect Implmeontatkon ond Integrated Subprolecbt Preopaation 5.2.1 Speclaized Consutants 970,005 970,005 5.2.2 Techrical Assistance for Project Implementation 5,720,000 5,720,000 Subtobtl 09Qn03S 6 05 SUJBOTAL- INTEGRATED STATE PLANNING AND SUBPROJECTS PREPARATION J,130,00S ZS0 252.0 7.0 09Q 210, 99,000 S. Stkndtlnina of COEMA'b 0.1 Propejlng Diannosticas c COEMAs 49,296 140 4.9 38 2000 6.2 Definkin Sbrengthning Strateg and ImpleTme!Lt 6.2.1 Defining and Implementing Strategy 32,360 8,400 5,250 1,210 17.500 6.2.2 Training COEMAs'Members 412,000 200,700 91,800 43,900 75,800 8.2.3 Other Strengthening Actions 311,732 30,000 30.000 45.000 71,732 135,000 Subtoabl 75,W2 2309100 127 90.110 104, 135, 6.3 Technical Assistance to COEMAtor Analvsd PGA and PA 70750 5600010, 6.4 Evluatlon of COEMAs 0 28,000 9.800 422 SUBTOTAL- COEMAS' STRENGTHENING 1.172.140 3S1.050 197.750 395.032 1S5 TOTAL COST PART I - STRENGTHENING OF STATE ENVIRONMENTAL ENTTFIES 31.095.35 2.71O20 1,70Q0 2.453.371 13,J19. 3.470.013 1.494. 6x470 % of Coat of Skenthenin of State Endtle 100.0% 8.7% 6.7% 7.9% 42.5% 11.2% 4.8% 18.9% Annex 2B - Page 4 BRAZIL - NATURAL RESOURCE POLICY DEVELOPMENT PROJECT PROJECT COST ESTIMATES AI~!ppll Technical Other Tobi Per Dmns T1ravel a Mterial Sevie O Shervc Wors Equlpmerb PARTE 2 - ZONING. MONITORING. CONTROL AND ENFORCEMENT (Z.MCAF1 1. bpekIl Acties o Su tegad Erwkronmeuial Manag,ement 1.1 Trainhig hor Zonina Actilies 1.1.1 ZEE Methodology Workshop 53,000 23,200 22,400 2,000 5,000 400 1.1.2 TrainIng 344,800 94,800 l0,000 200,000 1.1.3 Recycling Couses 367,200 117,200 50,000 200,000 1.1.4 Zoning Economic and Methodology Standazdizatlon Study 92,400 15,400 7,000 70,000 1.1.5 Study for Preparation of Thematic Base 287,700 54,100 19,600 4,000 210,000 Subtdal 1.146100 304, 149, 6000 5. 400 1.2 Geoproc"jng and Remot Senwir 1.2.1 Laboratories Instalation 985,000 16,243 7,580 386,000 64,145 501,032 1.2.2 Purchase of Software 270,000 270,000 1.2.3 Other Permanert Equipments and Goods 622,200 622,200 1.2.4 Training 506,200 168.000 58.000 6.200 276,000 Subtobal &3 184_243 063580 39t 330.1 1.39232 1.3 Study on th Terlariel Daa of thoe AawonReg 3470 347. SUBTOTAL - ENVIRONMENTAL MANAGEMENT SUPPORT AC11VITIES 1156 USA 212,580 39 1.30Z1 400 1.393232 2. KM,C&E Integrated Sutbproject Oncluding Terge!td 37.795. 3.371.7 21852 .040 16.208,095 4487.182 1.000.000 7.491.134 Strongthening to non- stt. Entides and Technical Asaisance) 3. Emergewcy Erforcemwent Acvtee Z .000 206.10 133,8 180,1 1,01Z311 23773 447,4 TOTAL COST OF PART 2- ZONING. MONITORINO.CONTROL AND ENFORCEMENT 904 4.00676 2535 3 18.582.650 471. 1.000.000 9.331.824 PARTE 3- PROJECT ADMINISTRATION 1. Support to Profect Commission 700,000 200.000 150.000 50.000 300,000 2. Support to Technical Secrtariat &M_000 273.000 247,600 100.000 1,392,000 87,500 . Technkal Support Requestd by States 00 00,000 90.000 720.000 4. Proect Evaluation 300,0 70.000 30.000 200,000 TOTAL COST OF PART 3- PROJECT ADMINISTRATION 4,000000 833,0 517.500 150. t 87500 toTAL PROJECT COST 790000 7.41t.301 4.813:44 6,237,37 34514.10 8221.08 2,494 15,30,79 % of Total Project Cost 100.0% 0.4% 6.1% 7.0% 437% 10.4% 3.2% 19.4% Notes \1 'Other Services' Includes services such as insalhion of equipmers and software, rentab for rairing and workshops, malrtenance of equipmerts, TV and radio programa \2 'Supples and Materiab' Includes operating costs such as fax and phone costs WCOIT19WKI - I111411194 60 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 3: IMPLEMENTATION SCHEDULE * Physical * Fmancial BRAZIL_- NATURAL RESOURCES POLICY PROJECT Prolect I _lementaton Schedu6 Total Estimated Yeaw I _ Yr 2 - I Ye3 _I Y r4 _Year5 Cost I T-2 4 2 3 ITI Z__] -2 _ PMT I - STRENGTHENING OF STATE ENVRONMENTAL ENTflfES 1. IW,rovina Oraantzation Cpacity for Intearated Evironmbl Marnaem t 1.1 ImprovnMm rsqm ntand Or%anknatlin St&mA(EMAs) 1.1.1 Diagnostics and Proposed Alternatives 485,000 1.1.3 Regional Workshops 225.000 ** 1.1.4Implementation 930,000 Sv*tobI 1,641.000 1.2 St nen.nInf r?mn ReaoN e! now AltrnyGenerrs cffices) 1.2.1 Assesslng ExIting Resowces and Needs and Preparatin of TraIning Programs 700,000 * 1.2.2 Carrying out Training Programs 4,760,000 . * * *** * .... .** .t **** ...*, 1.2.3 Establishing Project Management Systems (Systems and Training) 240,000 e 1.3 InEmroved Interconneeted Ennm lrdor e 1.3.1 Updating Diagnostics 129,000 *** ***c 1.3.2 Tralning of Personnel 1 t99,802 ------- 1.3.3 Develcping Softwares 127,000 *** *** **** 1.3.4 Purchase of Equipment and Software 1,538,073 * , , b * 1.3.5 Installaton 312,747 ' **.. 1.3.6 Data Acqusition 148,000 1.3.7 Operationand MaIntenance 1,011,129 ******** **** *** **d **** *** **i ***, *** *** * Sutb 3,4540.751 1.4 Pr vldina ConVmnatv IrmrEtucture and Equbmmnt 1.4.1 Bulkdings (Headquarters, Regional and Other Fleld Offices, Laboratorles, 1,494,000 DO * ** *, **** fll * *** 1.4.2 Equ4ments and Materiab for Laboratories 1,247,587 ""' ' 1.4.3 Vehicles (Automobiles, Boats and Equipment) 2,479,749 . *' 'Z ***4 *** ****. ** *** *** 1.4.4 Other Equipment 539.890 a* * ***p *e* **** * **. ** SubtW 5,751.232 SWTOTAL- IMPROVING ORGFtNETIONAL CAPACIY 10.587.9s3 2. Hwrmonxlzh and Adlustin the Leqal Framewrk 2.1.1 CarryhIg out Detailed Legal Diagnostics 52,580 , 2.1.2 Defining Strategy and Priorfites 44,000 2.1.3 EstablIshing and Maintaining CTELs 244.727 ** 2.1.5 Workshops and Specific Training 330,088 SUBTOTAL-HHMMONIZING a ADJUSTING LEGAL FRAMEWORK 071,35 BRAZIL - NATIMAL RESOURICES POLICY PROJECT Project Irvlemenbatlon Schedule Tobll Estimated eawl IesYew 3 S Yew4 _ Yew 5~ 3. Pramcthu Envfonmwntal Awwenesa. Dlasemrnmtion of Knowlodae. and Ptible DISCUSSIon 3.1 Cwrvlyng otd lrtmnmUtin Education and CommnunIcatIo Progrms 3.1.1 PlannInig Carrpalgns at ego 3.1.2 Contracting Preparation 201,800 O 3.1.3 xeCUtioni I1,070,~02M0** 44 4*M M 4*j**%'44 4.fn * 3.2 Inenasing Pitlic Pastcbpation In Pubic Hearhus for Licening, and hIn Monftorhm and ErFiCICnwDe 3.2.1 InformnationDmsclostretolnrterested Entities 801,400 d*44 n*4*nn n ,fi M- nro.n.i44M* n.n,i, 3.2.2 Oilie Activities 100.600,Mdn*ft.fn *4fn *4,44% flM,f,Mi Mdid'4 fdM, Stibtotsi 7U2.000 3.3 Supporthm DIssemination at. anid EstSilibhbi Demand for. New ScImm aricend Technloaglca KnfKedge 3.3.1 EstakblshIng Osmnand for SelentfieResewrch 143.770 44** ** fi*4 M fn .. 3.3.2 AcquIsition of TechnIcal-ScIentifIc rInformationfor Problem SoMng 156.828 M id.n M M 44 ** 3.3.3Productlon of Piticafions and Irnformdion DissemInation 343.304 M t 44 44 4.fn n,f*,ffdfn n n,'M SUBTOTAL - ENVIFtONMENTAL AWMRENESS 3783 4. Oruenlrton of EnvOirIownenta Maragenmet System at Regional Level 4.1 Defhina (IT O' beations 4.1.1 DefnIngG3TTPBy-lawsandStructwfe 4,200 Stittob 4.200 4.2 EsblIshhia (ITO 4.2.1 ApprovIng By-laws anid Slrtttsee 4.2.2 Preparing Calendar and Work program 21,000 4.2.3 Establishing GTlP 604,0004* 4***1ff nf fi nn Mf fidf4 n.fndfd*4*M'i4(44%4t 44, M sittatd s25.0o0 4.3 RegIonal Support for Environmental angagekmet 4.3.1 Training In Estaiblishment of Priorities for Envlornmental Managemenit 35,600 4.32 TrainIng In Regional Envkonmental Management Project Design 35, 500 4.33 DefinItion and Execution of Studies on PubIlic Regulations and Policies 138,500 Subttohl 89 oo SUBTOTAL- REGIONAL SIGEA ORGANIZATION 78 / l le- .Iv I age J BRAZIL - NATURAL RESOL_RCES POLICY PROJECT Prdlect In,Iementaltbn Scehdule Total Estianed Yew I J 1 43_2 Yew4 _Y Cost TIE i]ThiI~~4 I3 4 vr 2 1 4!I~ I11 5. CrQena Conditions br triteqrated Sbte Plannri and Iriearated Subprolects Preparatlon 5.1 Etbilishina and Mahintlnin Worhing Groups )-simuap t Unibe 5.1.1 Establishement ot GTs and Support Units 35000 5.1.2 GTs and Support Units Operations 1.455.000 ...**d. .lfl .*, . d ....fi . , n. n. * .l fin, ..fi, nfl, . fi.d .ii .. SubtotdI 1 490000 5.2 Technical Assistance to State Entities to Pnnn Prohect Invlemenbiion and Irtearated Subproledt PrspardEr 5.2.1 Specialzed Consultants 970,005 n .. .n n . f. . nn .. nn. nn. nn nn nn fi.. .. fin nfl n.. n nf d i 5.2.2 Technlcal Assistance for Projec Implementation 5,720,000 **** nn nfi* find nn, *nfi inn fin, fin n nn, n *fifi, find f fd fn n. Subtl 5,990_005 SUBTOTAL- INTEGRATED STATE PLANNING AND SUBPROJECTS PREPARATION 8,180 05 6. Strenatheenb d COEMA. 6.1 Prpuhgna Danoilcs d COEMAs 49,298 * ** 6.2 DeI,niStrenathening Strategy mid Imphtentflj SLibtobtl 6.2.1 Defining and Implemeing Strategy 32,360 8.2 2 Training COEMAs'Members 412,000 dd* fifi fin 6.2.3 Other Sttrngth.nlng Actions 311.732 ....*.. in.. fin.. fin in n nn n .n n n. ..... 756 09 6.3 TechnIcal Assistance to COEMAs 1or Anlis of PGA and PAs 286,750 *.*. .n in *** b***d **fi i*4 in fin fin, nns find find nn. fin, fin nn, find fin? *nnr S_tbtots 285l750 6.4 Evakluion of COEMAs 80.000 . fi Suibtotal 80000 SUBTOTAL- COEMAS STRENIGTHENING Subtobl 1.172.140 TOTAL COST PART - STRENGTHENING OF STATE ENVIRONMENTAL INSTflfTIONS 31 098, Arifex 3A- Page 4 BRAZIL - NATURAL RESOURCES POLICY PROJECT Prolect IniemrentfIion Schedutb Total Yew__ Entimated Yesw 1 I Year 2 - Year3 Yeis 4 I YW 5 cost -2 PART 2 - ZONING. MCtITCRING. CONTROL AND ENFCRCEMENT (E.M.CaE) I. SpecActitis hr St.port d Intrated Erw*onmenbl Maageent 1.1 Taina fyoNr Zoninu A*tKies 1. 1.1 ZEE Methodology Workshop 53,000 1.1.2 TralnIng 344,800 . n n . * 1.1.3Recycling Couses 367.200 find .*** ***. *fif .**** 1.1.4 Zoning EconomIc and Metiodology Starwadteatlon Study 92,400 1.1. 5 Study for Preparation of Thematic Base 287,700 fin .** Suboi 1.145,10, 1.2 G*_WroeauXlnaa Romofe Sensiig 1.2.1 LaboratcrIes Installation s05,000 * * 1.2.2 Pachase of Software 270,000 * _** 1.2.3 Othr Permanent Equipments and Goods 022,200 1.2.4 Training 508,200 ---------- 1.3 Study on tie Twrlttal Daft of the Amnzon Roglon 347,000 SUBTOTAL EW. MANAGEMENT SUPPCRT ACTVM_ES 3 , ___ ,O_. 2. Z.M.C&EIntatednt6d Sub ojcbt eknciudktt inl strenathenhi to non-x~i ustit ns and tectni msbt 37.705.* *** .* * *** 377 ***** ,a .** * ... * - - * ****.,* 3. Em tncvEnrenAenti tlvleS 2,250,0D0 . nj '* * * * ** * * * * ** n** ntd . * *n* TOTAL COST PART 2 - ZMC&E 43.901.U06 PART 3- PROJECT ADMIISTSAIR ON I. Support to Project Comiss7on 700,000f fi* *** **_ * .* .* l * ** *, . fin* ***. n f nn * fin * n .** n. fi* 2. Sup~port to TechnicAl Secretwht 2.100,00 ii*fdff,ffi ii ii i* ii fil f i iinlfn ffdd*i iiff,ff 3. Technical SupportRequested by States 0w,000 ****** *.**** fin *** n *** **n * n " ***** find 'i f nn ***( f** fine find nn* fin 4. Project Evaluation 300,000 nfl **** nfl n** TOTAL COST PART 3- PROJECT ADMINIS1RATION 4,000,000 TOTAL PROJECT COST 79,000,000 UmS1rl U.WI Annex 3B-Page 1 BRAZIL - NATURAL RESOURCES POLICY PROJECT Project Disbursement Schedule Total ( U S S Estimated Cost I Ye I Year 2 Yer 3 Year 4 Y1 rS PART 1 - STRENGTHENING OF STATE ENVIRONMENTAL INSTITUMTONS 1 Improving Orfanization Capacity for Integrated Evironmental Managemont 1.1 Improving Management and Organization System (OEMAs) t1..1 Diagnostics and Proposed Atternatives 486.000 486,000 1.1.2 Regional Workshops 225.000 225,000 1.1.3 Implementation 930.000 250,000 680,000 Subtotal 1,641,000 061,000 680 000 1.2 Strengthening Human Resources (OEMAs. Attomey General's Offices and other Env. Entities) 1.2.1 Assessing Existing Resources and Needs and Prpration of Training Programs 700.000 700,000 1.2.3 Carrying out Training Programs 4,760.000 300,000 2,142,000 1,866,000 652,000 1.2.4 Establishing Project Manragment Systems (Systems and Training) 240,000 240,000 Subtotal 5,700,000 |1,2400 0 2142,000 1 86W,000 652,000 1.3 Installing Improved Interconnected Environm-ntal Information Systems 1.3.1 Updating Diagnostics 129,000 129,000 1.3.2 Training of Personnel 199,802 159,842 39,960 1.3.3 Deloping Softwares 127,000 127,000 1.3.4 Purchase of Equipment and Software 1,538,073 2.786 1,076,651 458,636 1 .3.5 Installation 312,747 218,923 93,824 1.3.6 Data Acquisition 148,000 103.600 44,400 1.3.7 Operation and Maintenance 1,011,129 505,565 303,339 202,226 Subtotal 3,465,751 131786 1686,016 1,142,385 303339 202,226| 1.4 Providing Complementary Infrastructure and Equipment 1.4.1 Buildings (Headquarters, Regional and Field Offices and Laboratories) 1.494.000 203,00 747.000 544,00 1.4.2 Equipments and Materials for Laboratories 1.247,587 20.000 623.794 603,794 1.4.3 Vehicles (Automobiles, Boats and Equipment) 2,479,749 420,0O0 1,239,875 819.875 1.4.4 Other Equipment 539J96 57.000 269,948 212,948 Subtotal 5 761,232 700,000 2j8S06186 2!180A616 SUBTOTAL - IMPROVING ORGANIZATIONAL CAPACITY 16L5679833 3-032.786 7.388.632 4,089 001 055 339 202.226 2. Harmonizing and Adiusting the Legal Framework 2.1.1 Carrying out Detailed Legal Diagnosbcs 52.580 52.580 2.1.2 Defining Strategy and Priorities 44.000 44.000 2.1.3 Establishing & Maintaining CTELs 244.727 35,000 122,364 61,182 26,182 2.1.4 Workshops and Specific Training 330.088 35.000 198,053 97,035 Subtotal 671395 ! 1 Z,580 32 0416 1 S8,217 26 182 SUBTOTAL - HARMONIZING & ADJUSTING LEGAL FRAMEWORK 71 395 l 2416 158 217 3. Promotina Environmental Awaareness, Dissemination of Knowledge, and Public Discussion 3.1 Carrying out Information. Education and Communication Programs 3.1.1 Planning Campaigns 81,590 81.590 3.1.2 Contracting Preparation 291,800 87,540 204.260 3.1.3 Execution 1,979.020 890,559 692,657 395,804 Subtotal 2,35Z41O 1j69130 1 094,819 692 C57 395,804 3.2 Increasing Public Participation in Public Hearings for Licensing, and in Monitorina and Enforcement 3.2.1 Information Disclosure to Interested Partbes 691,400 74,080 207,420 207,420 138,280 64,20D 3.2.2 Other Activities 100,600 7,620 30.180 30,180 20,120 12.500 Subtotal 792 000 | 81700 237,600 237 600 158 400 76,700 3.3 Supporting Dissemination of. and Establishing Demand for. New Scientific and Technological Knowledge 3.3.1 Establishing Demand for Scientific Research 143,770 35,000 71,885 36,885 3.3.2 Acquisition of Technical- Scientific Information for Problem Solving 156,828 78,414 78,414 3.3.3 Production of Publications and Information Dissemination 343,304 34,330 137,322 102,991 68.66 SubtotSl t E 35 000 2 02 252,621 102 991 I 1 SUBTOTAL -ENVIRONMAENTAL AWARENESS 3,7188 312 | 11t 700 41 185040_ t 5 66 Annex SB-Page 2 BRAZIL - NATURAL RESOURCES POLICY PROJECT Project Disbursment Schedule Toai (U S ) Estimated __ _ _ __ _ _ _____ Cost ed Yar I I YWY s - _ Y r2S 4 Oranisatkon o Environmontal UMoenemnt System at R-gional Level 4.1 Definine GTTP Opetions 4.1.1 Defining GTTP By-laws and Structure 4.200 4.200 Subtotal 4.200 4.2 Establishing GTTP 4.2.1 Approving By-laws and Strutoure and Preparing Calendar and Work program 21,000 21,000 4.2.2 Estublishing GTIP 604,000 100,000 181.2O 151,000 90,600 81,200 Subtotal 025,000 121t.000 181,200 1s1.oo 900600 a1.200 4.3 Regional Support for Environmental Mane-ment 4.3.1 Training in Establishment of Prioribes for Enviommnta Management 35,500 17.750 17,750 4.3.2 Training in Regional Environmental Management Project Design 35,500 17.750 17,750 4.3.3 Definition and Execution of Studies on Public Reguibons and Policies 18,50w 18,50w Subtotal ao500 35 00 t 5300 SUBTOTAL - REGIONAL SIGEA ORGANIZATION 718-700 160.700 109 700 1ta.soo so.aw 81.200 5. Creating Conditions for Integrated Stae Rhnnina and Subprolect Prepaation 5.1 Establishina nd Maintaing Wosking Groups (GTs) and Support Units 5.1.1 Edtbsheme nt of GTs and Support Units 35,0O0 35.0W 5.1.2 GTs and Support Unit Operabions 1,455.000 140.00 436,500 363.750 291.000 223,750 Subtotal 1.490.000 t175 000 43oSOo 303.750 291,000 223.750 5.2 Tochnial Assistance to State Entities for Planing. Proiect Implementdion and Integrated Subaroject Preparation 5.2.1 Specialized Consultan 970,005 70,000 339,502 242,501 194,001 124,001 5.2.2 Technical Assistanc for Project Implementaion 5,720,000 610.0DO 1,520,000 1,520,000 1,520,000 550.000 Subttal 0090.005 !!0.o00 1,as.5,02 1.7e2,501 1.714,001 a74 001 SUBTOTAL - INTEGRATED STATE PLANNING AND INTEGRATED SUBPROJECTS PREPARATION s005. 5000 2 2E,002 2L12L251 2.005.001 807.751 6. Strenethning of COEMAs 6.1 Preparing Diagnosbes of COEMAs 49,298 49.298 Subtotal 49.298 4s.29a 6.2 Defining Str-ngthenins Strategy and Implementing It 6.2.1 Defining and Imphmenting Straegy 32,3e0 32,38D 6.2.2 Training COEMAs'Membem 412,000 68,350 240,555 103,005 6.2.3 Oter Strengthening Acbons 311.732 53,860 128,36 77,362 51,574 Subtkot 75.092 154 570 3os401 1ao0457 51.574 6.3 Technical Assistance to COEMAs for Anahysc of PCA and PAs 285.750 32250 63.625 63,625 63,62s 63.625 Subtotal 28.70 32.2so50 !.25 a3,025 03.025 03,a25 6-4 Evaluaion of COEMAs 80,000 40.00 40,000 SubtoW ao.ol 40 000 40.000 SUBTOTAL- STRENGTHENING OF COEMAS 1.172.140 23e118 433,11 2a4.082 11519 102s2 TOTAL COST OF PART 1 - STRENGTHENING OF STATE ENVIRONMENTAL INSTITUTIONS S1.os.35 4ea 1 229 225 | 9m0 4..3 1.825.067 67 Annex 3B-Page 3 BRAZIL - NATURAL RESOURCES POLICY PROJECT Project Disbursement Schedule Total (U S S) Estifnated _ _ _ _ _ _ _ _ _ _ _ _ Costim_ Year I Yar Z yWar 3 Yar 4 a Y r 5 PART 2 - ZONING. MONITORING. CONTROL AND ENFORCEMENT U.C&E) 1. Special Activities for Support of Integrated Environmental Manaaement 1.1 Training for Zoning Activities 1.1.1 ZEE Mdthododogy Workshop 53,000 I 53D000 1.1.2 Training 344,800 170,000 174.800 1.1.3 Recycling Courses 367,200 183,600 183.600 1.1.4 Zoning Economic and Methodology Standardization Study 92,400 15.000 77,400 1.1.5 Sbtdy for Prepaaion of Thematic Base 287,700 115.080 172,620 Subtotal 1.145.100 353.080 608 ,420 183600 0 0 1.2 Geoprocesing and Remote Sensing 1.2.1 Laboratories Installaon 965,000 482.500 482,500 1.2.2 Purchae of Software 270,000 270,000 1.2.3 Other Permanent Equipmernts and Goods 622.200 90,000 532.200 1 .2.4 Training 506,200 175,000 331,200 Subtotal 2.3e3.400 1,017500 1,345,900 0 0 0 1.3 Studv on th Territorial Data ot the Amazon Region 347.000 347.000 0 0 0 SUBTOTAL - ENV. MANAGEMENT SUPPORT ACTIVMES 3.855.W0 1.717,580 1.954.S20 1300 0 0 2. Z.M.C&E Integrated Subprojects (Includino Targeted str-nathening to non-state instrtutions and technical assistaneo) 37.795.965 7.559,193 13,228,588 11.338.790 5,669,395 3. Emergency Entorcement AetivIties 2,250,000 450,000 450,000 450,000 450,000 450,000 TOTAL COST OF PART 2 - Z.M.C&E 49 | 2!L7 9.963.513 3 625.188 11.788.790 6.11 9 395 PART 3 - PROJECT ADMINISTRATION 1. Support to Project Comission 700,000 100.000 150,000 150.000 150,000 150,000 2. Support to Technical Secretarit 2,100.000 280,000 455,000 455,000 455,000 455,000 3. Technical Support Requested by States 900.000 100,000 240,000 160,000 80,000 320,000 4. Project Evaluation 300,000 75,000 75.000 75,000 75,000 TOTAL COST OF PART 3 - PROJECT ADMINISTRATION 4.000.000 |480000 920.000 840.000 760.000 1.000.00C TOTAL PROJECT COST 79.000L000 7.215-464 221122738 4.031 278 16 695.159 8,945,361 100% 9% 28% 31% 21% 11% 5C0D1S79.WKI - 10/O2WI 68 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 4: SUMMARY CONTENTS OF THE OPERATION MANUAL Operational Manual Outline and Main Elements Outline of Contents of Operational Manual - Project Objectives and Description - Policies and Principles of Resource Allocation Eligibility of States and Institutions - Subproject Eligibility and Selection Criteria - Planning and programming Procedures and Calendar - Project Coordination Responsibilities at State and Federal Levels - Monitoring and Reporting, Procurement and Disbursements. Annexes - Formats for PEA/PGA, PA, POA, and subproject proposals I 69 Main Elements of the Operational Manual Access to Project Funds. Elifibility Criteria and Subproject Selection Criteria A - Eligibilitv of States (a) Signature of Acordo de Adesao (Subsidiary Grant Agreement) with MMA, including the following provisions: * acceptance of objectives and principles of the project; * acceptance of rules and requirements established in the RFT Grant Agreement; * commitment to follow procedures established in the Operational Manual and other agreed procedures indicated by MMA, including for the transfer of funds; * undertaking to provide counterpart funds in required amounts; * commitment to establish GT as a coordinating mechanism between project executing agencies, and a project support unit within the OEMA's structure (as condition of disbursements to the state) and support the work of state executing agencies; and * taking account of recommendations of CEZEE in setting sectoral policies and planning public investments and activities. (b) Continued access to project funds will depend on meeting the following conditions: * designation of representative to GTTP by June 30, 1995; * establishment or re-configuration of COEMA, with deliberative power and adequate representation of civil society (at least one representative from NGOs and one from socio-economic segments) by September 30, 1995; * establishment or re-configuration of CEZEE by September 30, 1995, with representatives (with voting powers) of the OEMA, NGOs (at least one), and socio-economic segments (at least one), and with participation of state-level representations of environmental federal entities (as consultative members); * demonstrate the existence of a Environmental General Attorney's Office (Curadoria) by December 1995; * demonstrate that, by September 30, 1996, COEMA has met at least 4 times in the preceding twelve months, with sufficient quorum, to 70 decide on matters under its mandate, and that its decisions have been published at least in the Official Journal and one newspaper of wide circulation in the state; * demonstrate by September 30, 1996, that CEZEE has met at least twice during the preceding twelve months, with sufficient quorum, to debate matters submitted for its consideration; * implement the recommendations of the Institutional Diagnostic Study according to the agreed calendar; * have a full PGA prepared and approved by COEMA by September 31, 1997; * demonstrate that all RIMAs and environmental licenses have been made available to concerned municipalities and the public, that public hearings have been advertized at least in the Official Joumal and one newspaper of wide circulation in the state, and that the list of fines and defaulters has been made available to the public; - demonstrate real growth in budget allocations to OEMAs from domestic sources relative to the previous year; and * ensure that state policies and public investments are compatible with CEZ;E recommendations. (c) except during the first two years of project implementation and for aggregated amounts not to exceed US$1.5 million per state, access to funds to finance integrated subprojects will be conditional on states having met the conditions listed in item (b) above. B- Eligibilitv of Institutions - Designated state entities must have signed five-year Implementation Contracts with MMA (with yearly supplements-termos aditivos-- incorporating the yearly budget); - participating federal entities must have signed similar contracts with MMA. C- Eligibility of Subprojects - their objectives must be consistent with the objectives of the Pilot Program, i.e they should aim at reducing the rate of deforestation in the Legal Amazon by: furthering the sustainable use of natural resources (forest and water resources); protecting the forest and biodiversity; and reducing contributions to carbon emissions. Thus, the following typical activities (inter-alia) would qualify: controlling deforestation and selective logging without adequate forest management; controlling fires 71 in forest or contiguous areas; control of garimpo activities (in particular of siltation and mercury pollution caused by these activities); and control of predatory fishing and hunting. Control of industrial and urban pollution would also qualify, when associated with: (i) the buming of wood or wood residues (charcoal manufacturing, wood burning in ceramics industry and buming of sawmill dust), which represents an indirect contribution of the forest to carbon emissions; (ii) when threatening biodiversity in sensitive eco-systems in priority areas; and (iii) when necessary to secure the support and participation of local communities in priority areas; qualifying activities are the following: (a) monitoring, defined as the systematic collection of data on environmental quality (water quality, air quality, vegetative cover and bio-diversity); quantification of deviations relative to norms and standards, and identification of causes of these deviations; and wide dissemination of monitoring data to communities, industry, scientists, NGOs, and state and federal govemment agencies involved in licensing, control and enforcement; (b) control and enforcement, aimed at correcting deviations relative to established norms and standards and dissuading potential defaulters, by verifying compliance (control) and imposing penalties on defaulters; (c) licensing, to the extent that agents operate without the required licenses (which incorporates the norms and standards to be respected); and (d) zoning; the purpose of zoning is to promote social and political commitment to the use of areas and their natural resources in ways that conserve natural resources while allowing sustainable socio-economic development, based on scientific analyses of actual and potential uses. Zoning activities will include: (a) creation of institutional capabilities for zoning; (b) execution of zoning on a scale of 1:250,000 of the area of influence of the subproject; (c) execution of zoning work on smaller scales (1:100,000 or 1:50,000) in sub-areas, as required to support the planned licensing, monitoring, control and enforcement activities under the subproject; (d) study and recommendation of changes to sector policies (incentives, investments) at the various levels of government to induce implementation of these recommendations by the public and private sectors; and of targeted actions in specific areas; - they must be consistent with priorities established in the PEA and later PGA (themes and priority areas); - they must be recommended by COEMA; - they must show adequate integration between licensing, zoning, monitoring, control and enforcement activities (financed under the project or other projects or already existing in the area); - executing agencies must demonstrate adequate technical, financial and institutional implementation capabilities; and 72 - with respect to zoning, the following additional conditions must be met: * the zoning portion of the subproject must have been reviewed and approved by CEZEE; * the methodology and process proposed for the subproject must be consistent with that established in the Operational Manual (to be developed in workshops organized in the early stages of project implementation), and must include the required steps for consultation with affected groups and public hearings (the proposal would include a description of the proposed processes) - effective participation of local representations of federal agencies, municipalities, organized civil society and affected populations in the various stages of zoning work (including socio-economic data collection and analysis and analysis of alternatives) and public hearings on zoning recommendations. These elements will be part of the methodology to be defined as part of the project; * Protocolos de Intenqao must have been signed with municipalities and local associations within these municipalities located wholly or partially in the area to be zoned; and * states must have implemented the sub-programs of preparation for Zoning, Geo-processing and Remote Sensing included under Part 2 of the project. D- Selection of Subproiects (a) Selection Criteria and Point System: quality of the proposed strategy and methodology proposed for zoning, monitoring, control and enforcement: (i) Zoning: * traditional approach, with emphasis on information processing and preparation of maps: 5 points; * as above, but including preparation of options for sustainable use of natural resources, with popular participation: 10 points; * innovative approach: as above, but including a strategy to influence public policies: 15 points. (ii) Monitoring: * traditional approach, with emphasis on primary data collection, without capabilities for analysis: 5 points; as above, but with program of utilization of data and good interpretation capabilities: 10 points; * innovative approach, understood as with interpretation capabilities, and emphasis on available information, and 73 with a strategy for utilization of the monitoring information: 15 points. (iii) Control and Enforcement: * traditional approach, with emphasis on means: 5 points; * as above, but including a program to apply these means at strategic points: 10 points * innovative approach, including, in addition to the above, a strategy to obtain multiplying effects and replicability: 15 points - participation of socio-economic segments in environmental management in the area and themes of the subproject, when applicable: * without participation: 5 points; * with participation of NGOs: 10 points; * with participation of social segments: 10 points; * with participation of both: 15 points. - replicability: * not replicable: 5 points; * replicable only within the state: 10 points; - replicable within the Amazon region: 15 points. - contribution to community awareness of the need for environmental management: * no dissemination and without significant participation of local communities: 5 points; * wide dissemination, but without significant participation of local communities: 10 points; * vwide dissemination and with participation of local communities from the start: 15 points. - potential contribution to adjustments to environmental management procedures within the state: * plans reporting of actions only: 5 points; * plans reporting of actions and evaluation of results: 10 points; * as above, but includes a process of readjustments of environmental management processes: 15 points. - financial sustainability: * continued dependence on budget resources to maintain activities at the end of the project period: 5 points; * with guarantee of self-financing at the end of the project period: 10 points; * project activities will generate surplus: 15 points. - degree of integration between zoning, monitoring, and control and enforcement activities within the project: * only one type of activity: 5 points; 74 * two types of activity: 10 points; * three types of activity: 15 points. - degree of cooperation between the various levels of government for project execution: * only one level of government agencies (federal or state): 5 points; * state and federal government agencies: 10 points; * municipal governments: 5 more points. (b) Evaluation and selection methodology The total maximum number of points is thus 150 (it will be lower whenever some criteria are not applicable). A subproject will be selected if it obtains 60% of the total maximum number of points for relevant criteria. This threshold may be adjusted during implementation.] E- Financing Limits for Part 2 - An initial allocation6 of US$1.5 million (total costs) would be reserved for each state during the first two years (after effectiveness), during which states would be exempted from meeting state eligibility criteria listed in Section A(b). Beyond this date, uncommitted funds would be reassigned to the competitive fund. - Funding of "emergency enforcement activities" (ad-hoc actions outside those programmed using the project planning mechanisms) would be limited to no more than US$250,000 per state over the life of the project. - Total funding per state for subprojects under Part 2 would be limited to US$7.5 million. 6 For the states of Acre, Pari and Amazonas, the relevant allocations up to Mid-term Review will be determined by KfW, since the funds will be coming from German financial cooperation. 75 F- Eligible Expenditures for Part 1 and 2 - All expenditures, except salaries of regular staff and taxes, would be eligible. Only works of a value of less than US$200,000 in the aggregate per subproject would be eligible under Part 2, so as to limit them to small-scale construction (such as construction of outposts, surveillance installations, etc..). Eligible recurrent costs (such as supplies and materials) would be financed from external funds on a declining basis, from 90% in year 1, to 75% in year 2, 50% in year 3, 30% in year 4, and 10% in year 5; - weapons would be eligible, but they would not be financed from extemal funds. I 76 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 5: PROJECT ORGANIZATION AND INSTITUTIONAL MECHANISMS AT FEDERAL AND STATE LEVELS * Project Coordination Structure at the State Level * Project Coordination Structure at the Federal Level * Project Procedures 77 Annex 5 Gmph I BRAZIL - NATURAL RESOURCES POLICY PROJECT Projet Coordintbon Structure at Smt, Level T dinicsl C A EuO*or COELmA Comm - CE~~E 9 Znnuig Caem, ~ ~ ~ ~ ~ ~ CEZE Worn SE Group Suport Uni LNGO Is M unxip_ and Non-C_vrwb Or9wmmo potlieipi s peedic subprowj COELUA SMt_E n_mw. Council 1F7PF _bf Zoning Cemm^"aon OEMA Slf Envionnal Agwwy Annex 5 BRAZIL - NATURAL RESOURCES POUCY PROJECT Graph 2 Prolect Coordinatlon Structue at Federal Level Pilot ogram Coordinating Cormission (CCPP) PildPogram Executive Seoetai I Proled_ Trochriam ingadTc Nsbusem l Procuement S Monitorlng Iyoup s Consulltants Cornposition of CP - One representative ot IBAMA - One representative of SAE Finance 11Codnadr) - Three Tehreca senlti oyl aGs oresiden and reGOesentathie of MAP(non-anting) D ivebssreweontatvso h tts(pone fProntfe yernt aMrotatingbasis) - onve representatives of NIB .orAousMA G 79 Project Procedures Activity Preparation Review Con olidation 4 oval State Federal State Federal IBRD/Don ors State Environmental OEMA COEMA and COEMA and Plan (PEA) and PGA CEZEE (for CEZEE- zoning Sent to ST activities) for information Subproject Proposals Executing submitted to ST appraises IBRD and entities, under CEZEE, then subprojects financing GT coordination to COEMA, and proposes donors and with for clearance rating; approve assistance from submits its UA and recommendat specialist ions to CP. consultants CP clears provided by ST subproject. upon request, or hired by the states. Regional Activities ST, in GTTP CP clears the IBRD and consultation with regional financing GTTP programs donors approve 80 Activity Preparation Review Consolidation State Federal State Federal IBRD/Don ors PAs - 5-year (revised Executing GT reviews GT (with ST ST checks as every year for the Entity, with PAs for UA (consolidatio needed for next five year period) Technical consistency support) n of state consistency support and with PAs) with program assistance from PEA/PGA, rules UA with (budget, approved eligibility of subproject institutions, proposals, activities, with project expenditures, eligibility counterpart rules funding), (institutions, forwards activities, them expenditures together with counterpart their federal funds) and consolidation ST budget summary to instructions. CP for forwards to clearance ST all PAs, with comments and consolidation Note: NeefrystmaicdetildeviwyTwllbesummary |Note: Need for systematic detailed. review by ST will be reassessed at Mid-term Review. 81 Activity Preparation Review Con olidation oval State Federal State Federal IBRD/Don ors POAs - for Executing GT (with ST CP clears, IBRD and institutional Entity, with UA support) consolidates ST approves relevant strengthening and for technical verifies state POAs after donors other activities under assistance from consistency and send checking as approve approved subprojects GT/UA with PAs, consolida- needed for consoli- sends all tion to CP consistency dated (POAs are reviewed POAs to ST with regional semi-annually in July- together with approved POA subprojects which their PAs and have been approved consolidation other criteria by then may be (as above) included in the POA and send to at that point if IBRD and consistent with relevant budgetary donors allocations). Note: Need for detailed review by ST will be reassessed at Mid-term Review. Termos Aditivos ST, based on Executing Termos IBRD and approved POAs Entities Aditivos are relevant signed by donors MMA and approve executing Termos entities. Aditivos 82 Activity Pre aration Review Consolidation App State Federal State Federal IBRD/Don ors Revision of program May be STS SEPP IBRD and norms, criteria and proposed by any reviews, (Secretaria relevant procedures state either to based on CP Executiva do donors ST or to its recommen- Programa approve representative in dation. Piloto) the CP. Review approves may be submission requested by ST from ST or any member after of CP, or approval has following the been Mid-term obtained Review. from IBRD Decision to and relevant proceed with donors revision voted upon within CP. ST prepares l____________________ revised proposal 83 Activity Preparation Review Conlidationa 5= Federal State Federal IBRD/Don ors Semi-annual Progress Executing GT (with ST Reporting (relat6rios Entities prepare, UA support) consolidates de acompanhamento based on reviews, reports every ffsico-financeiros) standard pre- consolidates six months, determined twice a year sends this format and and sends to report to CP, indicators. ST IAG, IBRD and relevant All reports donors. simultaneously sent to GT/UA and ST Annual Evaluation Under GT, with ST prepares Reports (based on coordination of UA support, annual performance GT and with consolidates evaluation indicators measuring support from them and report and progress towards UA, Executing sends to ST forwards it to defined objectives) Entities prepare with CP for annual comments; comments. evaluation of Circulated to Incorporates institutional COEMA, comments in strengthening CEZEE and final version and subproject CP for forwarded to results (in light information. Pilot of original Program objectives and Coordination on the basis of Commission pre-defined (CCPP) performance (through indicators) SEPP), IAG, IBRD and relevant donors 84 Activity Preparation Review Con: olidation oval l State Federal State Federal IBRD/Don l________ ors Mid-term Review GT, with ST CCPP, after IBRD and support from consolidates obtaining donors UA, coordinates and forwards Bank and approve, preparation of to CP, IBRD relevant following mid-term and relevant donors' Mid-term evaluation report donors. agreement Review focusing on Following required changes joint review, to project ST prepares processes draft amendment forwards to to project COEMA, procedures, CEZEE, GTTP mechanisms and ST and allocation of funds. Submits to CP for review and clearance Ex-post Impact ST prepares All CCPP IBRD and Evaluation draft Project relevant Implementation donors Report jointly with the Bank _ Transfer of Funds Based on chronogram agreed upon in POAs and incorporated in Termos Aditivos, and conditional on compliance by each entity with fund release requirements (reporting of previous expenditures...), ST transfers advances from Special Account. Later transfers conditional on entity presenting SOEs on expenditures financed by previous transfer. Project Accounting Each executing entity keeps separate accounts according to standard accounting model. These accounts are audited annually by independent auditors. 85 Activily Preparation Review Consolidation . la State Federal State Federal IBRD/Don Procurement Executing ST, IBRD, entities, based depending depending on pre- on on established thresholds threshold rules, under ST l _____________________ guidance Notes - GT/UA consolidate the PAs/POAs of state-level agencies and offices (superintendencies) of federal entities participating into subprojects. - ST will provide temporary guidance in the field if requested by the states. Such guidance would facilitate (and hopefully speed-up) later approvals by MMA. - Subproject proposals can be presented to ST for immediate review and approval at any time in the year. If approved, they will be included in PAs and POAs for the following year (or the same year if approved in time for incorporation of POA semiannual review and if within approved budgetary allocations for the executing entities). 86 BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 6. PERFORMANCE INDICATORS PART 1: STRENGTIIENING STATE ENVIRONMENTAL ENTITIES PART I ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUB-ACTIVITIES INITIAL INPUTS COVENANTS OUTPUT INDICATORS MPACT INDICATORS 1. Strcngthen I .1 Strengthen 1. Firms, or specialists, to All States must 1. Mectings and workshops to I. All nine Arnaznian sttes OEMAa, by December 1999, function with greater Management management systems undertake institutional have implemented operstionalize recommendations authority in the tate governmental system. Their credible financial management and (e.g. financial assessmenta are contfacted by the agreed agreed upon in institutional systems and ability to plan for financial sustainability in some corc functions arm Organizational management, personnel April 1995. recommendations assessments will have begun by indicated by: Capacities for management, of the August 30, 1995. Decentralized monitoring of policy 2. Report detailing options institutional (i) quality OEMA reporting on global, project, and subproject budgets; Ervironmenlal implementation) for strengthening OEMAs is diagnostic on a 2. First steps tomards Policy & available on July 30, 1995. timetable agreed strengthening internal (ii) financial reports regularly produced and publicly available; Implementation 1 1.1. Diagnostic of Report to include: by the Bank. management systems in management needs (a) Statement of the mission of OEMAS will have been taken (iii) records of licenses, taxes, fees, fines collected are sent to senior the OEMA and elements of a by October 1995. management at predictable intervals. 1.1.2. Alternatives work plan to meet that proposed mission. (b) Specific steps to 3. Discussions with state 2. Personnel Management Systems, the level of professionalism, and strengthen the personnel and governmental actors, includirg environmental management is higher than at start of project, as indicated by: 1. 1. 3. Workshops to financial management systems where necessary the COEMA, refine new appraches to improve performance. on charges in the OEMA will (i) Each OEMA has, by 1999, a personnel policy that has been accepted and is be underway by December under implementation which has a transparent merit rectuitment process, work 1.1.4. Installation of 1995. programming, fair remuneration, and annual performance evaluation. new systems 4. Minimum of 6 states have (i) Interview data indicate that personnel In the OEMAs have improved strengthened at least one corm working conditions, job satisfaction, fair salaries, end adequate equipment to management system by January perform essential functions professionally. 1997. (iii) Annual data indicate that staff turnover has progressively decreased as well 5. All states have strengthened as dependance upon seconded staff and short term consultants. a minimum of tvmo corn management systems by (iv) All laboratories and scientific equipment, computers, spreadsheet softwarc, December 1998. digitalized mapping, and zoning and monilDring equipment and software are fully utilized by trained and working staff. (v) A regular system for monitoring personnel perlbmrance is functioning and regularly used by senior management. 87 PART I ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUB-ACTIVITIES INITIAL INPUTS COVENANTS OUTPUT INDICATORS IMPACT INDICATORS 1. Strengthen 1 .2 Strengthen human 1. Contract for human I. Contract for 1. Human Resource 1.2. Human Resources are trained and performing more effectively as indicated management resource skills in resource and training Project Assessment compleed by by: and environmental assessment signed by Accountirg and June, 1995. organizational management. March 30, 1995. Management (i) Other state actors report (in interviews) that they have called upon, or hestd capacities for Information 2. Schedule for sub-regional from, the OEMAs on environmental policy questions more frequently since the decentralized 1 .2.1 Assess existing 2. Preparation for the tIo System is signed delivery of program is July, start of the project. environmental human resource emergency courses --(I) by April 30, 1995. Program of courses, policy and capacities. project preparation and (2) 1995 and preparation of course syllabi by (ii) OEMA projects, programs, and policies are stronger than the programs, implementation project implementation is installed in MMA selected Brmzilian institutions is policies or projecta that they had promulgated prior to the start of the project. (cont'd) 1.2.2 Prepare training underway by June 30, 1995. and in state underway on material tailored programs and special executing for Amazonian states by (ii) There are more trained enironmental prosecubors, judges in ervironmental courses. 3. Courses are prepared and agencies by August, 1995. law; and more environmental information distributed to judicial administrative logistics for staff to receive September 30, staff. 1.2.3 Deliver courses training are resolved for two 1995. 3. Two emergency coufaes - - for staffs of entities. emergency courses to Project Preparation and Project (iv) There are more OEMA stff with skills in environmental law and commence in September 1995 Implementation- - are delivered enlbrbement, environmental economics, appraisal, monitoring, licensing, and all other courses to in each participating state by enforcement, analysis of environmental impact, and strategic planning, by commence by November September 1995. Remaining December 1999. 1995. courses to commence by November, 1995. 4. 10% of the staff of six states has completed one training course by last quarter of 1995; 50% of staff of each entity has compleled training by last quarter of 1998. 1 .3 Install an 1. Equipment is acquired for 1. An environmental amplified installation in last quarter of information system team is environmental 1996. trained for each environmental 1.3 The quality of ervironmental data in the states by December 1999 is information system entity in the nine states between improved as indicated by: interlinking the nine 2. Linkirig the states to one April 1996 and April 1997. (i) comparison with ex ante environmental data. states, another takes place by (ii) usefulness of data to decision makers. November, 1997. 2. Environmental data from (iii) capability of system to exchange data with one another. 1.3.1 Train personnel subproject critical priority areas (iv) usefulness of data for subpmject monitoring. in environmental is entered into the system by information systems. September, 1997. 1.3.2 Develop applications. 3. Monitorirg of the subproject 1.3.3 Acquire environmental data is in equipment and pmgress by December, 1997. software. 1.3.4 Install system. 1.3.5 Acquire envimnmental data; operate system. 88 PART I ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUB-ACTIVITIES INITIAL INPUTS COVENANTS OUTPUT INDICATORS IMPACT INDICATORS I. Strengthen 1.4 Additional I. Requests justifying space 1. Space needs are under 1.4 Monitoring and enforcement activities are improved due to equipment and management infrastructure and needs reviewed by construction by Midterm training as indicated by: and equipment. November, 1995. Review, organizational (i) laboratories are fully utilized and well maintained as part of envirnmentaf capacities for 1.4.1 Construction 2. Contracts for construction 2. Laboratory staff are actively monitorirg. decentralized works (building, are tendered by June, 1996. monitorirg environmental environmental additional space for quality by last quarter of 1997. (ii) there are more frequent and effective monitorirg and enforcement activities. policy and headquarters and 3. Laboratory personnel are implementation regional sites) trained by October, 1996. 3. 75% of the vehicles are (iii) vehicles and equipment have enabled monitoring and enforcement activities (contd) purchased by last quarter, 1997, to increase as measured in comparison with ex ante monitorirg and enforcement. 1.4.2 Laboratories (not 4. Laboratory equipment for and are being used to improve in new laboratories is bought monitoring and enforcement. MT,RO,AC,AM,PA) within three months of the completion of construction. 1.43 Vehicles (automobiles, trucks, boats) 89 PART I ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUBACTIVITIES INITIAL INPUTS COVENANT OUTPUT INDICATORS "ACMT INDICATORS 2. Strengthen 2.1 Detail the legal 1. All states have a completed All states must I. The legal diagnostic and A strengthened environmenbal legal framework is indicated by: Legal Framework diagnostic of the states. diagnostic and prepared a demonstrate instititional dianostics are program for impmving their existence of a compatibilized by 1. All states have a basic environmental law and its regulations setting out 2.2 Establish a legal frameworks by prosecubnr December; 1995. environmental policies and guidance for their implementation by January 1997. technical commission December 1995. office on state environmental specialized in 2. Recommendations on 2. At least three sates have subsecDral environmental laws clarifyirg their legislation (camara 2. CTELs established in a envirnmental compatibilizirg legal policies and responsibilities in thee subsector (forestry, water quality, moil tecnica estadual de minimum of 6 states before mattern by frameworks are m de by erosion, fishing) by December 1997; six mome slates by December 1999. legislacso) (CTEL) March 1996. December31, June 1997. 1995. 3. The effectiveness of this legal framnwrk is indicated by: 2.3 Make trainirg available to state (1) increased numbem, and values, of fines and fees imposed and collected; environmental (ii) increased numben of requesb for licenses; prosecuorss. (iii) increased numbets of court cases initiated; (iv) increased numben of court cases upholding position of the OEMA; 2.4 Workshops on (v) Reduced number of conflicts smong entitites due to clarifications about legal requisites for respective roles in enforcement as a result of new legal framework. environmental protection. 90 PART I ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUB-ACTIVITIES INITIAL INPUTS COVENANTS OUTPUT INDICATORS IMPACT INDICATORS 3. Strengthen 3.1 Execute a program 1. A program for public 1. Records are kept indicating 1. Simple public opinion polling indicates that public knowledgeability about state public access to of public environmental environmental infornation that the number of public environmental policies and their impact has increased. environmental information, education with activities planned, hearings, and public meetirgs information; and communication, scheduled, and staff assigned increases by 30% between 2. Media (radios, TV, newspapers) carry environmental indicators and news widen public 3.2 Augment public responsibilities has been December 1995 and stories about policies and their enforcement more frequently than at the start of knowledgeability; participation, and approved by the entity's senior December 1997. the project. and increase public hearings, in management and is ready to be public regard to environmental operationalized by 2. Number of radio 3. Universities, secondary schools, citizen groups, associations, NGOs, churches, participation in monitoring and September 1996. announcemenb, pamphlets and civic society assemblies actively seek OEMA's help on ervmirnmental affairs environmental enforcement, distributed, videos prepared by throughout mtates. decision making. 3.3 Acquire new OEMAs and shown to approaches to applied audiences increases at least by 4. The participation of NGOs has increased in public hearings and public technology and 30% betveen November 1995 envirornmental education programs. (Records must be kept by OEMAs from the scientific information and December 1997. start of the project in order to track this perfbnmance.) useful for environmental 3. Number of public requests 5. The number of municipalities with enironmental councils (Condemas) has protection. for action by environmental increased from the situation at the start of the project. prosecubr increases. 3.1.1 Plan information strategy 4. A progress report for the 3.1.2 Elaborate that Mid-Term review details the information plan and demand for, and supply of, implement it information on applied 3.1.3 Divulge technology and scientific inforrnation to information useful for interested parties envirnmental protection in 3.1.4 Increase the the states. incentives for those interested to participate 5. An increasing number of 3.1.5 acquire OEMAa are producing annual technological reports on their State's information useful for environmental conditions by solving immediate Mid Term Review. environmental problems 3.1.6 produce and 6. By December 1993 states disseminate pamphlets, report by way of simple manuals, publications, empirical information the use videos, and material for made of, and results gained radio programs. from, new applied technology. 91 PART I ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUB-ACTIVITIES INITIAL INPUTS COVENANTS OUTPUT INDICATORS IMPACT INDICATORS 4. A regional 4. 1. Create a regional I. Membership and basic work All states must I At least two meetirgs a I. The regional system for integrated environmental management led by GT'TP system of permanent Technical methods established for the designate their year of the GIiP acting as a has contributed to the implemenbtion of the project by increasing the quality and integrated Working Group GTTP by May, 1995. representatives forum to discuss their states' timeliness of information shared region-wide. environmentsl (GTTP) with Calendar and plan for to GTTP by systems for environmenisl management is membership from each meetirgs prepared by June 30, 1995. management (SEGAs) have 2. While a working group, not an executive group, the GITP has facilitated the established and of the state June, 1995. been held regular exchagep of information about what works, and what does not, amorg functionirg, ervironmental agencies. technical saff. Interview data provides specific examples of the ways the GTTP 2. Reports of the meeting have has strengthened information excharges. 4.2 Define the bases been distributed to several of functioning of the different entities. At lest three 3. Best practice in terms of norms and their enfbrcement is more consistent GTTP. GaTP reports are ailable for throughout the region. public access in the states, by 4.3 Support integrated December 1997. regional ernironmental management activities. 4.1.1 Prepare a model for functioning and a plan of action. 4.2.2 Establish a calendar for implementing the plan. 4.3.3 Specify the other regional activities. 4.3.4 Define and implement norms and relevant policies 5. Create I. A simplified state I. All states I. POAs for correspondirg I There is significantly stregthened environmental coordination at the state level conditions for 5.1 Establish working environmental management must prepare years are prepared by as reflected in joint decisions taken on subprojecta, and the extension of technical integrated state groups (GTs). plan is prepared by Working full executing agencies and assistance to those responsible for prepamtion and implementation plans. level planning Groups (Grupo de Trabalho - environmental consolidated by respective and effective 5.2 OEMA, through its Ul) with the Support Unit in management GT/UAs. POAs are approved 2. Participants in Working Groups share information amorg members on progress implementation of support unit (UA), OEMA and approved by plan and hsve it by the Bank by October I, of made on combatirg environmenal degradation. Rates of deforestation, soil subprojects. provides technical December 1995. approved by each year. erosion, and water quality is regularly reported by members to one another. assistance to entities for their COEMA plannirg and 2. Working Groups (GTs) by December, 3. Support Unit in OEMA becomes a major source for technical assistance for preparation of with assistance from Support 1997. plannirg, preparirg, and implementing asubpnojects grows throughout the life of subprojects. Unit in OEMA prepare the project. This Is indicated by numbers of requests made for technical subprject proposals. 2. A five year assistance, and the quality and timeliness of technical assistance extended. action plan for 2. POAs for 1996 have been Part A of approved by October I, 1995. project must be approved by the Bank by September 30, 1995. 92 PART I ACTIVITIES/ DATED INTERMEDIATE IMPACT INDICATORS OBJECTIVES SUB-ACTIVITIES INITIAL INPUTS COVENANTS OUTPUT INDICATORS 6. Strengthening 6.1 Diagnostic of the 1. Subprojects begin to be I) All states 1. All subpmjects are 1. Strengthened sate councils (COEMAs) are effective in norm setting, the state councils state councils, considered by COEMAs by have COEMAs recommnended by the coordinatlon of the environmental system, and widening undentanding of state for environmental 6.2 Define and last quartr of 1996. with delibenative appropriate COEMA. envimnmenil management as indicated by: management. implement strategies powers and (COEMAs) for strengthening these adequate 2. Full POAs are prepared and (i) The frequency with which State Secretarias actively seek COEMA Input into councils, representation of submitted to COEMA by state investment choices 6.3 Evaluate civil society (at December30, 1997. systematically their least one NGO (ii) The number of tate norms that COEMAs have deliberated and implemented functionirg and fmm has increased significantly over the ex ante situation. effectiveness. environmentl, business, and (iii) The number of environmental directives incoproated into state policies has social segments) increased. and representatives (iv) The number of draft laws proposed to the State Congresses has increased. of environmental (v) The number of specializd technical committees (camatas technicas) of the agencies, by COEMA, and the quality of participation in those committees, has increased. September 30, 1995. 2) All states must demonstate that their COEMAs are functioning effectively (ie., have met four times the preceding year with quorum; decisions publicizd in official journal and one newspaper) by September 30, 1996. 93 PART II: ZONING, MONITORING, AND ENFORCEMENT PART 11 ACTIVITIESI DATED INTERMEDIATE OBJECTIVES SUBACTIVITIES INPUT INDICATORS COVENANTS OUTPUT INDICATORS IMPACT INDICATORS I. Special 1.1 Trainirg for I. ZEE Methodology Workshop I) All states have 1. 75 % of of the zoning 1. Quality and usefulness of zoning in all partIcipatire states is Activilies for Zonirg Activities takes place by July 30, 1995. established or training is completed by June increased and Influences state investrnent choices. Support of reconfigured their zonifg 30, 1996. Integrated 1. .I ZEE 2. Training materials prepared commissions (CEZEE) Environmental Methodology for courses by August 1995. with deliberative policy 2. Membership and functionirg Management. Workshop. OEMA representatives, of CEZEE is perceived to be 3. Zoning Economic and and adequate civil society more active and useful by stte 1.1.2 Training Methodology Standardiztion representation (at least secretaries by mid term review. study staru by October 1995 one NGO from 1.1.3 Recycling and is completed by April, environmental, business, 3. Normatization Courses 1996. and social segments) by development of regulatory September 30, 1995. framework for state public 1.1. 4 Zoning investments -- initiated by last Economic and 2. CEZEES have met at quarter of 1997. Methodology least twice during the Standardization Study. preceding 12 months, 4. Zoning equipment installed with sufficient quorum to and operational in at least 7 1.1.5 Study for debate and decide zoning states by September 30, 1996. Preparation of matters by September, Thematic Base 1996. 3. Throughout implementation of the project, the participating state's productive investments (including those of entities controlled directly or indirectly by the state) shall take into account the recommendations of the respective CEZEE regardirgland use, economic, and agro- 1.2 Geoprocessing and ecological zonirng. Remote Sensing. 1.2. 1. Laboratory installed. 1.2.2. Software . Laboratory installed by pufchased. March 30, 1996, and fully 1.2.3. Other operational by July, 1996. equipment and goods. 94 PART II: ZONING, MONITORING, AND ENFIORCEMENT PART 11 ACTIVITIES/ DATED INTERMEDIATE OBJECTIVES SUBACTIVITIES INPUT INDICATORS COVENANTS OUTPUT INDICATORS IMPACT INDICATORS 1.3 Study on the I. Study on Territorisl Data is 1. All states have needed basic information in the data already Territorial Data of the undertaken during the second collected by IBGE to start their intensive zoning activities in critical Amazonian Region. and third quarters of 1995, and subproject areaa by September, 1995. delivered to states before September 30, 1995. 2. Z,M, C + E 2. 1 Selective 2. At least four subprojects are 1. All remaining subprojects 2. Indicators (in subproject proposals) will measur: Integrated strengthening of non- approved by December 30, (beyond those approved by (a) how well they meet their goals, (e.g. to reduce deforestation - Subprojects state entities located 1996. 1996) will be approved by whether the rate of deforestation was in fact reduced in the subproject (including within states. December 30, 1998. area; (b) usefulness of the 'lessons leamed' from the demonstration; as targetted indicated charges in zoning, monitoring, or enforcement processes sirengthening to 2.2 Integrated within the participating entity; (c) quality of inter-organizational nonstate subprojects of zoning 2. Intermediste and impact collaboration within the state in this demonstration subproject, (e.g. institutions and monitoring, and indicators will be developed for municipalities, NGOs, and state level authorities); and (d) the technical enforcement, including each integrated subproject participation of relevant stakeholders in the decision making about the assitance). directed institutional proposal. subpmject. strenghening. 3. States will have increased the frequency and effectiveness of monitoring and enfbrcement activities in comparison with their ex ante situation. 9D BRAZIL PILOT PROGRAM TO CONSERVE THIE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 7: SUMMARY OF THREE EXAMPLES OF POSSIBLE 1NTEGRATED SUBPROJECTS 1. The profiles presented below are illustrative only. While they do correspond to specific state proposals, or critical areas and themes examined under the pre-investment studies financed as part of project preparation, they do not necessarily represent integrated subproject proposals which will be presented by the states. These will be defined only after priority themes and areas have been defined in PEAs/PGAs and approved by COEMAs. Example no. 1: State of Para -- Paragominas region -- Sawmill Activities 2. The Paragominas region consists of four municipalities (Paragominas, Rondon do Para, Dom Eliseu, and Ulian6polis), with a total area of 3.6 million hectares and a population of 186,450. The town of Paragominas is located 320 km southeast of Belem, on the Bel6m-Brasilia highway. Due to its good transportation infrastructure and proximity to the forest, it has the largest concentration of sawmills (over 300) in Brazil, most established since the early 1980s. Already, 25% of the total area of these municipalities has been altered through the traditional pattern of selective logging followed by pasture establishment. Timber that is left by logging and sawmill activities, as well as by land-clearing for agriculture and pasture establishment, is sold to the ceramics industry or transformed into charcoal for the pig iron industry. Sawmill operation efficiency is low, with more than 50% of the timber wasted. The combination of sawdust incineration and charcoal production has introduced thick air pollution over the town, adversely affecting human health. In the absence of stronger monitoring, control, and enforcement measures, there is no reason to expect that the deforestation of the area will diminish or subside. 3. The integrated subproject would design mechanisms and incentives aimed at encouraging adequate forest management, waste reduction, and pollution control. It would include: (a) zoning the sawmills' area of influence (in order to identify exploited areas, areas that are potentially exploitable for logging and agriculture, and conservation areas to be set aside); (b) monitoring forest cover and environmental degradation in the zoned areas; (c) disseminating available forest management and pollution control technologies among loggers and sawmill owners through workshops and visits to demonstration areas, and providing technical assistance to incorporate this knowledge into management plans; (d) implementing control and enforcement measures, including (i) requiring all sawmills to present acceptable Integrated Forestry/Industry Plans (PIFIs) as required by law; (ii) reviewing all licenses granted to sawmills; (iii) controlling the execution of PIFIs through on-site checking of logging concessions and self-managed areas, and compliance with standards of logging and replacement in other areas in which deforestation permits are issued; (iv) controlling the origin and size of logs at sawmill gates and along logging roads and rivers; (v) systematically applying penalties, 96 including fines, the impounding of illegal logs, and, if necessary, the closing of sawmills; (vi) protecting conservation areas, including indigenous reserves (the Gurupi Biological Reserve and adjoining Amerindian reserves in neighboring Maranhao, which would require a concerted effort between the two states); and (vii) monitoring and enforcement of air pollution standards through the prohibition of charcoal production and the incineration of sawmill dust without adequate in-situ air pollution control equipment. 4. The structure of incentives would also be reviewed, and proposed measures submitted to COEMA, CEZEE and other relevant authorities for approval, to ensure that they support control and enforcement efforts and provide financial sustainability for increased control and enforcement activities. Incentives to be considered could include: (a) additional state logging taxes for logs which do not originate from managed forests (to supplement IBAMA's Log Replacement Tax, which is well below forest management costs and thus currently provides an incentive for deforestation rather than forest management); (b) substantially increased levels of fines imposed on defaulters, again calculated to provide incentives for sound forest management and air pollution control; (c) elimination of tax or credit incentives to all sawmills and charcoal manufacturers not conforming to zoning and forest management regulations, and air and water pollution standards; (d) provision of timed-based tax incentives for sawmills which adopt appropriate forest conservation practices and other industrial practices which reduce or eliminate timber waste and pollution; and (e) review of criteria for land titling, and elimination of factors which prevent or make difficult the obtaining by sawmills of titles to their managed forest lands (such as land clearance as a proof of exploitation). 5. The integrated subproject would be implemented through the coordinated action of: (a) IBAMA, which would review and monitor the execution of PIFIs and requests for deforestation permits; (b) the OEMA of the state of Para (SECTAM), which, in coordination with IBAMA, would review and monitor all licenses to sawmills (for deforestation, forest management, and control of air and water pollution) and would for that purpose establish an office in Paragominas; (c) Para's CEZEE and the state entity in charge of zoning (IDESP), which would carry out zoning work and propose enactment of appropriate regulations and/or propose policies to apply zoning recommendations; (d) the state Forestry Police, which would help control logging operations (operating checkpoints on logging roads and rivers, and assisting IBAMA with monitoring the implementation of forest management plans); and (e) INCRA, which would carry out activities required by sawmills to legalize ownership of their self managed areas. These institutions would also be supported through the formation of a CONDEMA in the town of Paragominas, and the provision of training, technical and legal assistance to the CONDEMA and the environmental coordinator of the municipality of Paragominas, which would assist with control of air and water pollution. Other entities and NGOs (such as IMAZON) could participate in the integrated subproject, as a subcontractor, to guide the industry and help IBAMA in the design and implementation-monitoring of sustainable forest management techniques. Example no. 2: State of Maranhao -- Sawmill and Pig Iron Production in the Carajas Corridor 6. The region of Aqailandia-Imperatriz faces the same problems as the Paragominas area, with a total of about 250 sawmills distributed among the two towns. Environmental problems are acute. They are caused by a combination of factors, including logging and sawmill operations, colonization 97 and livestock development facilitated by the construction of transportation infrastructure (Belem-Brasilia highway, Carajas railroad), and by charcoal- based pig iron industries that require iron ore provided by the Carajas mine. There are six pig iron plants in the Carajas corridor, one near Marabd (Para), and five in Maranhao (including four in Acailandia and one near Sao Luis). Charcoal for pig iron manufacturing is mostly derived from sawmill residues (about 53%) and residues from clearings for agriculture and pasture establishment (35%). Only about 12% come from forest management. Yet, the law requires pig iron manufacturers to demonstrate, by 1995, that all charcoal used in pig iron production is derived from wood produced from planted or managed forests. Except for one producer (in the Cerrado near Sao Luis), none of them is anywhere near compliance. 7. An integrated subproject similar to that in Paragominas (discussed above) could be developed in this region and along the border with Para (to help preserve what is left of the Gurupi Biological Reserve and adjoining Amerindian reserves and other conservation areas). This subproject would have the same characteristics as the Paragominas subproject, and both subprojects, if carried out in parallel, would significantly reinforce their mutual impact on logging and sawmill operations in the region. 8. With respect to pig iron producers, the integrated subproject would aim at providing them with incentives to comply with the law by: (a) adopting less wasteful pig iron and charcoal manufacturing technologies, thus reducing wood requirements overall and improving the profitability of their current operations; and (b) reaching self-sufficiency within a set timeframe. They would be required to prepare and submit acceptable PIFIs, with a timetable to reach self-sufficiency in wood supply for charcoal production. After IBAMA has approved these PIFIs, it would monitor its implementation with the assistance of the OEMA in Maranhao (SEMA) and the state environmental police. The origin of charcoal would be regularly monitored and reported to SEMA, and penalties would be applied when pig iron producers are unable to document sufficient charcoal production from their own planted or managed forests. SEMA would also regularly check on measures taken to reduce air and water pollution in charcoal batteries (in particular in, or near Acailandia) and pig iron plants. SEMA and IBAMA would report non-compliance to Companhia Vale do Rio Doce (CVRD, the iron ore supplier), which has incorporated in supply contracts with pig iron producers conditions related to compliance by their clients with environmental regulations. CVRD is also prepared to provide pig iron producers with technical assistance to increase the efficiency of their operations by reducing charcoal needs (such as fines injection technologies) and wood requirements in charcoal production, as well as in forest plantations and management. The threat of suspension of iron ore deliveries would act as a powerful incentive to implement PIFIs as approved, and CVRD could thus be a very powerful ally in the effectiveness of this subproject. In order to facilitate the transition of pig iron producers toward self-sufficiency, the state could also study ways to make available to them financial resources to implement reforestation or forest management schemes, and possibly grant them temporary tax incentives. Example no. 3: State of Para -- Gold Mining Activities in the Tapai6s Area 9. This area, which covers about 165,718 square kilometers, is located south of Santarem along the Tapaj6s river in southwestern Para, and includes the municipalities of Itaituba, Jacareacanga, Trairao and Novo Progresso. Development, however, has centered around the Itaituba municipality, principally due to intense garimpo (gold mining) activity, and has been 96 somewhat spurred by colonization schemes made possible by the Transamazonian highway, and, more recently, by rapid development of livestock activities (through the application of wealth derived from the garimpo activity). The area includes a national park (Parque Nacional da Amaz6nia), a forest reserve (Reserva Florestal Mundurucania), three Amerindian reserves, and the Tapaj6s Garimpo Reserve. Total population is estimated at about 180,000. Further development of agriculture, logging, and sawmill activities are constrained by a lack of an adequate transportation infrastructure, but this could change if the Transamazon and the Santarem-Cuiaba highways are improved. 10. Garimpo activity is by far the major source of environmental degradation today. Although authorized garimpo activities are confined to a total area of 28,000 square kilometers (Reserva Garimpera do Tapaj6s), they in fact extend to more than 100,000 square kilometers and involve an estimated population of 100,000 to 125,000. Total gold production of the Itaituba municipality was estimated in 1990 to account for 12% of national gold production and 56% of gold production in the state of Para. Environmental degradation from this activity includes soil degradation due to the removal of forest cover and the loss of topsoil, siltation of large amounts of sediments into rivers (causing a loss of oxygen which endangers fish populations), water pollution by oils and greases, and, most of all, mercury pollution of air and water. Garimpo activity has also increased the spread of endemic diseases (in particular malaria). 11. The integrated subproject would aim at: (a) controlling the risks of further environmental degradation by carrying out the zoning of the affected area (specifically, elaborate a cadaster of garimpo operations, identify conservation areas and areas where agricultural and livestock operations can be carried out in a sustainable fashion, and subsequently implement zoning recommendations and monitor their effect); and (b) mitigating the negative impacts of garimpo activities through combined licensing, monitoring, technological promotion, and control and enforcement actions. These actions would include: (i) disseminating available technologies that recover mercury and reduce its use; (ii) licensing all larger operations ("closed garimpos", i.e., operations owned or controlled by a few individuals, usually the purchaser of gold) and garimpos organized in cooperatives, which increasingly control garimpo activities (licenses would be granted on the basis of Piano de Recuperacio de Areas Degradadas (PRADs) and Planos de Controle Ambiental (PCAs) required by law and EIAs for any new garimpos, and would be conditional on the adoption of mitigating measures with respect to the use of retorts by all workers and traders to recover mercury during amalgam burning operations, the construction of detention ponds, and mercury recovery from these ponds); (iii) monitoring the adoption of these measures through regular visits and sample checks; (iv) promoting, through educational campaigns among individual garimperos, the adoption of mercury conservation and recovery techniques in exchange for legalization of their operations and the provision of social services to them as well as all garimpo workers; (v) carrying out enforcement, through removal of garimperos from conservation areas, and non-licensed areas, and imposing penalties on operations not in compliance with licensing conditions; and (vi) systematically monitoring mercury pollution of air, water, fish and humans in the area and downstream. 12. Incentives to comply and regularize garimpo activities could also be studied, including the provision during a limited period of tax incentives or titles. Sustainability of actions implemented under the integrated subproject could be ensured through a combination of penalties imposed upon defaulters, and other means such as payment of a pollution levy. 99 13. The integrated subproject could be implemented through the coordinated actions of: (a) Departamento Nacional da Producao Mineral (DNPM, the federal agency with the authority to grant mining concessions), which will grant mining concessions and help identify and disseminate environmentally neutral technologies; (b) SECTAM, which will concede, control and enforce the implementation of environmental licenses, establish monitoring points and disseminate monitoring results among garimperos, the scientific community, public agencies involved in the integrated subproject, and populations potentially affected by river pollution and mercury contamination; (c) the federal and/or state police, which will provide support for enforcement activities (in particular the removal of illegal garimpo activities from indian lands and conservation areas; (d) IDESP, which will carry out zoning work; and (e) COEMA and CEZEE, which will review, develop and promote the enactment of zoning regulations, norms and standards, and establish incentives goveming garimpo activities in the state of Para. The municipality of Itaituba will help in the collection of royalties and assist in the monitoring of garimpo activities. Associations of communities located along the Tapaj6s river (possibly advised by NGOs such as "Saude e Alegria") will participate in the collection and reporting of monitoring information, information on illegal garimpo activities, and environmental and health awareness programs among these communities and garimpeiros (placer miners). i 1 u BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 8: SUtMMARY TERMS OF REFERENCE FOR MAJOR STUDIES I - DIAGNOSTIC OF STATE ENVIRONMENTAL INSTITUTONAL AND ORGANIZATIONAL SYSTEMS7 Part 1 of the Natural Resource Policies Project addresses the need for institutional capacity. It starts with strengthening the capacities of the organizations themselves in light of their mission, and strategy for meeting their priority goals, in environmental protection. Strengthening organizational capacities does not mean increasing their size. It means strengthening internal management systems in order to induce increased productivity and professionalism of personnel within organizations. Productivity gains cannot be actualized with training alone, particularly if the structure of the organization and its internal incentives does not provide opportunities for effective professional work. Therefore, organizational capacity must proceed in parallel with training programs. Two central aspects of organizational capacity are personnel management and financial management. In meetings with state representatives during the preparation and appraisal of this project, they repeatedly came back to their organizational capacity problems, especially with their terms of employment, systemic weaknesses, as well as the need for training. OBJECTIVES The objectives of the diagnostic of the environmental institutional and organizational systems in the Amazonian state environmental agencies are to: 1. Clarify the mission of state environmental agencies, and their priorities in order to perform improved environmental protection more effectively. Develop a detailed strategy for addressing those priorities. In light of the mission and strategy, to undertake an in-depth diagnostic of each state's specific framework and internal organizational structure. 2. Identify the structural changes needed, and the managerial and organizational systems which would enable the state environmental organizations to deliver integrated environmental management on a state-wide level. 3. Recommend the specific changes needed in core management systems - - for example, in personnel management and financial management. To make specific recommendations on what should be done, by whom, and on what timetable, to carry forward institutional strengthening. 1 The full text and appended material for these terms of reference are available in the project files. 101 MAIN ACTIVITIES 1. Nine State Senior-Level Workshops. Subject of workshops: (i) mission of state environmental agency, priorities, and strategy for addressing priorities, (ii) structural changes needed, if required, to address environmental priorities, (iii) specific changes required in core management systems, (iv) calendar of step steps, including where necessary, follow-up negotiation meetings, and other subsidiary workshops needed for other key stakeholders. A. Participants in Senior-Level Workshop to include: President of Environmental Organization; Secretary of Administration; Secretary of Environment; Secretary of Planning; Representatives from Secretary of Finance; Two Representatives from State Assembly; Governor or Lt. Governor; B. State entities which are exploring alternative structural forms, such as becoming foundations, in order to attain more autonomy in recruitment, retention, and remuneration, and in use of financial resources raised through fines, fees, user charges are likely to need a series of meetings and negotiations in order to resolve what is to be done, by whom, and when in order to achieve structural change. For other changes in the standing of the environmental agency in state policy determination, or for changes in internal management systems, (e.g. salary systems), subsidiary meetings with different stakeholders will be necessary. 2. Agreement on Workshop Reprt Recommendations. The report of the senior leaders workshop should be a succinct statement of recommendations, a calendar of next steps, and a call for next meetings and the nature of their participants in order to further progress on the recommendations. 3. State Environmental Agencies Workshops. Subject of Workshops: Development of mission statement and priorities of the state agency, and essential changes for strengthening internal management systems in order to address priorities. A. A report outlining the implementation strategy must be detailed and specific in assigning responsibility for agreed upon tasks and next steps. Specific attention must be paid within this strategy on incentives for staff for improvements in performance, improvements in personnel systems, and specific steps to strengthen financial management systems within the environmental agency; B. Given the current acceptance that internal management problems, especially in personnel, incentives, and work programming the diagnostic must then also: (1) detail the problems in the personnel systems and financial management systems of the state agency. ( In the case of the personnel systems, special attention should be paid to the incentives for performance, including criteria actually utilized in recruitment, retention, promotion, and remuneration.) (2) specify alterative steps towards improving these factors; and (3) identify what actions can be undertaken, at which level, and by which offices, in order to improve these factors. In the case of the financial management systems, special attention should be paid to the possibility for better management of current financial resources, improved record management, and improved accountability. The long run goal of financial sustainability for some activities must be discussed in the course of this diagnostic. 102 4. Meetings as needed to negotiate recommendarions on organizational strengthening (structure, rules, roles in regard to core organizational operation, especially in regard to personnel and financial management) in order to deliver integrated environmental management. PRODUCTS 1. Nine Reports on Recommendations from Senior Level Workshops. 2. Subsidiary Reports from Environmental Agency Workshops. These reports will detail specific changes, agreements reached, steps taken to operationalize improvements, and recommendations for next steps in organizational strengthening to be undertaken over the remaining life of the project. 3. Qperational Manuals for Strengthening Organizational Operations. 4. Budgets for the Diagnostic Process. 5. Report on Fine Tuning Internal Management Systems. After the internal organizational changes have been put into operation, a report will be issued identifying what fine tuning or adjustments are required to ensure the utility of the systems in improving the performance of the organization. I - ASSESSMENT OF HUMAN RESOURCE NEEDS AND PREPARATION AND DELIVERY OF TRAINIG PROGRAM FOR STATE ENVIRONMENTAL ENTITIES' OBJECTIVES The objectives of the human resource assessment and training program are: (1) to strengthen the potential for decentralized and deconcentrated environmental protection, and towards that end, (2) to enhance the capacities of Amazonian state environmental entities to undertake more active roles in the making and implementing of state environmental protection policies. These terms of reference call for contractors to: (1) execute the human resource assessment called for under Part 1 of the project; (2) refine the program of courses to be offered in light of that assessment; (3) identify the best sources to develop the course materials; (4) identify and contract for the delivery of those courses; (5) utilize wherever possible a clustered sub-regional approach for their delivery; and (6) implement the training program, delivering the courses over the life of the project. The human resource assessment and training program is to address the needs of Amazonian OEMAs, planning secretariats, zoning commissions, forestry police, and environmental prosecutors, as well as judges involved in environmental litigation. Preliminary data on the OEMAs will be utilized in the course of this assessment and in preparing the delivery of a substantial training program. ' The full text and appended material for these terms of reference are available in the project files. 103 MAIN ACTIVITIES 1. Refine training needs for participating state entities (OEMA, CEZEE, Forestry Police, Secretariats of Planning, Curadorias, etc..) in the institutional strengthening component (Part 1 of the project). The agreed upon program of course offerings is to be revised and completed when undertaling this assessment. 2. Identify Brazilian and intemational institutes, universities, firns, or foundations able to provide curriculum materials, expertise, and/or possible trainers able to provide material relevant to the needs reflected in the assessment, and in the program of course offerings. Wherever possible these courses are to be prepared using case material from the region, ensuring that the material communicated in the course meets the operational needs of the staff in attendance. 3. Prepare two courses to be delivered in each of the nine states within the initial months of the project: Project Preparation and Project Implementation. Participants in these courses will be preparing integrated subprojects under Part 2 of the project, therefore in these courses every effort should be made to make use of the case material on potential integrated subproject themes and areas. State of the art methodologies for problem identification, and its disaggregation into activities which address that problem -- e.g. the logical framework for project design used by USAID, or the ZOPP technology -- should be included in the project preparation course. Methodologies for facilitating implementation, such as performance indicators, cost spread sheets and their analysis, and methods for resolving and managing conflict during implementation, must be communicated in the course on project implementation. 4. Refine the modalities to be used in delivering the training program, detailing how often different courses are to be offered in the regional training program, and which ones need to be supplemented by study tours or leadership exchanges, and in rare cases, longer term training. 5. Prepare plan and timetable for actual delivery of the agreed program of course offerings. Identify and prepare logistics for using three different locations within the region for offering courses. 6. Design and plan the rotation of courses, specifying which courses are to be offered, how often, and in which location, specifying how this plan meets the needs identified in the human resource assessment. 7. Prepare a detailed budget for delivery of the agreed program of course offerings, indicating counterpart fund needs, as required. 8. Contract with firms, universities, or institutions to prepare the courses, identify instructors, and teach the courses as planned. Contract to have course materials translated into Portuguese, as necessary. 9. Prepare an evaluation form to be used in the courses, and a process for learning from the evaluation process in the Mid-term Review, in order to improve the delivery of the agreed program. 10. Training program is to include, inter alia, the following courses: Project Preparation; Project Implementation; Project Evaluation; Environmental Management; Management of Financial Resources; Personnel Administration; Management Information Systems; Environmental Legislation; Environmental Law and Enforcement; Environmental Economics (or Economics of Natural 104 Resources); Analysis of Environmental Policies; Environmental Information and Roles of Civil Society in Environmental Management; Zoning, Simulation of Alternatives, Public Participation, and the Process of Normatization; Interpretation of Remote Sensing Data; Environmental Assessments and RIMAs; Integrated Environmental Management for Sustainable Development; Licensing; Managing Environmental Laboratories; Stabilizing and Rehabilitating Degraded Areas; Evaluating Quality of Natural Resource Management.9 PRODUCTS 1. Human Resource Assessment Report. This report is to detail: (a) staff training needs for the OEMAs, and for federal entities within the states eligible for training due to their expected involvement in the carrying out of integrated subprojects, and (b) finalization of a program of courses to be offered to meet those needs. Due June 1995. 2. Report identifying Brazilian and international institutes, universities, firms, or foundations able to provide course material and/or trainers to prepare the courses for delivery. Due June 1995. 3. Detailed syllabi for courses to be offered on an emergency basis (Project Preparation and Project Implementation), a list of possible institutions to deliver these courses, and a timetable and budget for their delivery in each state. Due by July 1995. 4. Report with detailed plan for rotation of courses at their subregional locations (including study tours), timetable by course, and budget for training program. Due July 1995. 5. A comprehensive and detailed budget for delivery of the agreed activities for each year of the project. Due July 1995. 6. Contract with firms, universities, or institutions to prepare course materials, identify and secure instructors, and teach emergency courses (Project Preparation and Project Implementation) in each state. Due July 1995. 7. Contract with firms, universities, or institutions to prepare course materials, identify and secure instructors, and teach courses in subregional locations. Due October 1995. 8. Project Preparation and Project Implementation programs to commence October 1995 and other training programs to commence January 1996. 9 Detailed course descriptions, as reviewed by representatives of the states during the meetings in September, are available in project files. Lists of potential supplying institutions, foundations, universities, or firms are also available in project files. ;,U) m - ASSESSMENT OF ENVIRONMENTAL LAWS AND REG11LATIONS OBJECTIVES The general objective of this work is to provide a report which, on a state-by- state basis, will: (i) confirm the results found in the pre-investment study; (ii) identify priority areas which lack a legal framework; (iii) indicate areas of legal conflict (between federal, state and municipal legislation); (iv) recommend, through legal drafts and explanatory texts, alternatives which improve the legal framework; (v) recommend a standard setting process, including priority areas for standards; (vi) recommend legal instruments that promote financial sustainability (e.g. environmental funds, fines, fees and taxes); (vii) give special attention to the quality of enforcement, such as with administrative sanctions (e.g. fines, suspensions, and closures) and monitoring and control instruments (auditing, reporting, and inspections); and (viii) provide special attention to developing and/or strengthening the local permitting and planning process, including environmental impact assessment requirements and guidelines (specific priority guidelines include deforestation, mitigation measures for degraded land, and exploitation of floodplains (varzeas)). PROCEDURES FOR THE CONSULTING WORK The consulting work shall be carried out in close contact with state, federal and municipal agencies as well as with non-governmental organizations. Such contact will be in the form of interviews and exchanges of preliminary drafts. The consulting shall also be carried out in close coordination with the COEMAs and GTTP, as the project envisions the creation of technical chambers for these entities. The GTTP will be responsible for examining all the state reports in order to verify whether there are any proposal conflicts among the states, and for increasing the exchange of ideas on the subject of examination. The final report shall be circulated among all interested parties mentioned above. SPECIFIC ACTIVITIES PER STATE In addition to the items listed in l.a. above, and once the findings from the pre-investment study are confirmed, the proposed consulting work shall also give priority to the already identified work areas. A tentative list of some of these areas is provided below on a state-by-state basis. a. Acre Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) regulate the general environmental law; 106 (ii) regulate the recovery of degraded areas; (iii) regulate the provision which grants the legislature the power to approve certain programs and projects; (iv) regulate the adoption of standards, environmental cadastre for development activities, and annual environmental reports; and (v) regulate the protection of historical and cultural sites. b. Amapa Due to the current lack of legal instruments, the first measure should be the passage of general state environmental law by the local legislature, and then its regulation. It is recommended that no further advances in this initial stage be made until the basic legal framework is consolidated. Experience in other cases shows that the need for additional legal instruments arises when the basic legal framework is consolidated. c. Amazonas Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) update the land use law; (ii) regulate the polluter-pay principle of the state Constitution; (iii) include as an instrument, and regulate, state protected areas; (iv) regulate the protection of the subsoil; and (v) regulate public participation. d. Maranhao Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) complete and update the State Environmental Code and its regulations; (ii) draft criteria for the application of fines; (iii) regulate the principle which provides for tax and credit incentives for those who act in ways that are more favorable to the environment; (iv) draft land-use regulations for soil conservation; and (v) examine and harmonize state and federal forestry laws. e. Mato Grosso Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) assist in perfecting and regulating the general environmental law for the state; (ii) legislate the adoption of new technologies and pesticides; (iii) regulate the conservation of the subsoil, underground waters, and noise pollution; and (iv) regulate liability for environmental damage. f. Para Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) assist in perfecting and regulating the general environmental law for the state; 10'i (ii) legislate policies concerning soil conservation, forestry, hunting, fishing, and pollution control; and (iii) regulate the adoption of an environmental cadastre for development activities. g. Rond6nia Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) regulate the general environmental law; (ii) legislate policies concerning forestry, hunting, pollution control, and historical and cultural sites; (iii) create a framework for public participation. h. Roraima Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) assist in perfecting and regulating the general environmental law for the state; (ii) regulate the scope of the state environmental jurisdiction; (iii) legislate policies on water, noise pollution, and soil and subsoil conservation; (iv) establish a legal framework for public participation; and (v) regulate the protection of historical and cultural sites. i. Tocantins Provide a report with recommendations, including a draft of the applicable legal instrument, on ways to: (i) re-examine and adjust the decree that regulated the general environmental law; (ii) provide special attention to the adequate use of legal instruments from the State of Goias; (iii) regulate the use and conservation of soils and waters; (iv) regulate the provision of environmental education; (v) re-examine noise pollution regulations; and (vi) regulate the participation of the state in filing environmental law suits. t. Q. BRAZIL PILOT PROGRAM TO CONSERVE THE BRAZILIAN RAIN FOREST NATURAL RESOURCES POLICY PROJECT ANNEX 9: REPORTS AND DOCUMENTS IN PROJECT FILES Documents supporting the project: I Documento Basico, Subprograma de Polftica de Recursos Naturais, Ministerio do Meio Ambiente e da Amaz6nia Legal, PPG7 (Brasflia, August, 1994); 2. Legislaqao Ambiental, including Relatorio Final, Roberto dos Santos Vieira and Yara Maria Gomide Gouvea, August, 1994; 3. Detailed project cost tables per state; 4. Detailed TORs for the studies nos. I and II of Annex 8; 5. Pre-investmnent studies, as follows: TOR 1: Informacao Basica para o Zoneamento Ecol6gico-Econ6mico - Relat6rio Final e Mapas-indices Temgticos, Engenharia Ambiental, Projetos e Servicos, Leonam F. P. Souza, July, 1994 (2 volumes); TOR 2: Uso e Ocupacao do Solo e Ecologia - Relatorio Final e Mapas-Indices Tematicos, Engenharia Ambiental, Projetos e Servicos, Leonam F. P. Souza, July, 1994 (2 volumes); TOR 3: S6cio-Economia - Relat6rio Final, IBAMA, IDEAS (Instituto de Desenvolvimento Ambiente e Sociedade), June, 1994; TOR 4: Situag1o Fundiaria, Secretaria de Assuntos Estrategicos, MAPPA Engenharia e Consultoria Ltda; TOR 5: Uso de Sensoriamento Remoto e Sistemas de Informag6es Geograficas Para o Programa PPG-7 - Relat6rio Tecnico Final, SAE, IBAMA, Imagem Sensoriamento Remoto SIC Ltda (IMAGEM), July, 1994; TOR 6: Impactos Ambientais de Atividades Economicas, Instituto Sociedade, Populagao e Natureza, July, 1994; TOR 7: Sistemas de Monitoramento e Vigilancia, Instituto SPN, July, 1994; TOR 8: Sistemas de Controle e Fiscalizacao, IDEAS, July, 1994. Documents related to the sector: 1. Diagn6stico dos Orgaos de Meio Ambiente da Amaz6nia Legal, Resultados do Seminario patrocinado pelo PNMA, 1994; 2. Diagn6stico Institucional dos Orgaos Estaduais de Meio Ambiente no Brasil, ABEMA (Associacao Brasileira de Entidades de Meio Ambiente) Report, June 1993; .W9 3. Plano Estrat6gico de Desenvolvimento do Amazonas, PLANAMAZONAS (IDB/SUDAM/Amazonas), 1994; 4. Brazil: The Management of Agriculture, Rural Development and Natural Resources; WB Report No. 11783-BR, July 31, 1994; 5. Brazil: An Analysis of Environmental Problems in the Amazon, WB Report No. 9104-BR, May 21, 1992; 6. Brazil: An Analysis of Environmental Problems in the Amazon, Annexes, WB Report No. 9104-BR, July 15, 1992; 7. Brazil: Government and Economy on the Amazon Frontier, WB Report No. 12644LAC, December 30, 1993; 8. Institutional Development in the Latin America and Caribbean Region: Lessons of Experience and Recommendations for Improvement, WB Report No. 7, LATPS, Occasional Papers Series, June 1992. 9. Decentralization of Environmental Policy: Potential for the Brazilian Amazon, David Rosenblatt, June 1994. 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