facility administration manual...project number: 41122 february 2010 loan 2560-geo: mff for road...

Project Number: 41122 February 2010

Loan 2560-GEO: MFF for Road Corridor Investment Program Important Note: This facility administration manual is an active document. It will be updated and revised progressively as and when necessary during each review mission and following any changes in project investment costs, scope, or implementation arrangements. The contents herein are intended to assist and facilitate project management and implementation. If there is any conflict with any other legal agreement(s) related to this Investment program, the provision(s) in the legal agreement(s) will prevail.

Facility Administration Manual

Contents Main Text..........................................................................................................................3 I. INTRODUCTION 3 II. PURPOSE 3 III. KEY PERSONS INVOLVED IN THE PROJECT 3 IV. PROCESSING HISTORY 5 Annex 1: Project Definition ............................................................................................5 I. Sponsors, Stakeholders and External Agencies 5 II. Impact and Outcomes 6 III. Outputs 6 Annex 2: Project Management.......................................................................................6 2.1 Roles and Responsibilities 6 Annex 3: Procurement Plan ...........................................................................................9 3.1 Process Thresholds and Reviews 9 3.2 Procurement Plan 9 Annex 4: Safeguards Plan............................................................................................11 Annex 5: Financing Plan ..............................................................................................12 5.1 Financing Plan, Fund Flow and Disbursement Arrangements 12 5.2 Allocation Table 14 5.3 Other Financiers 14 Annex 6: Investment Plan ............................................................................................15 6.1 Detail Cost Estimate 15 6.2 Forecast of Cost to Complete ($ million) 15 Annex 7: Implementation Plan.....................................................................................16 7.1 Responsibility Allocation by Activity 16 7.2 Execution Plan (Investment Program) 17 7.3 Execution Plan (Project 1) 18 7.4 Annual Work Plan 19 Annex 8: Performance Monitoring and Evaluation....................................................19 8.1 Deliverables 19 8.2 Performance Indicators 19 8.3 Monitoring and Evaluation Report 20 Annex 9: Major Covenants ...........................................................................................20 9.1 Legal Covenants 20 9.2 Financial Covenants 21 9.3 Safeguards Covenants 21 Annex 10: Appendices..................................................................................................24

3

Main Text ) pen

I. INTRODUCTION The Road Corridor Investment program for Georgia aims to create a better trade logistic corridor and enhance Georgia's cooperation with neighboring countries. On 29 September 2009, ADB approved the proposed MFF for $500 million to support the Investment Program based on the 2008 Joint Needs Assessment developed by the United Nations and other aid agencies including ADB. Tranche 1 Project costs about $149 million, with ADB providing about $118.8 million from ADB's Special Funds Resources, and the Government providing about $30.1 million as counterpart funds. Tranche 1 to be implemented over 4 years covers four components: (i) construction of a 34 km two-lane bypass skirting Kobuleti, (ii) capacity assistance to the Roads Department; (iii) road safety measures and (iv) project management support, including detailed design and construction supervision.

II. PURPOSE

This Facility Administration Manual (FAM) focuses on the essentials for implementing the MFF and the first tranche Project and will be updated as needed. The FAM contains data and information that allows the Borrower, executing agency, implementing agency, and ADB to monitor project implementation and evaluate project impact.

III. KEY PERSONS INVOLVED IN THE PROJECT

A. ADB Staff

The department responsible for the implementation of the Project is the Central and West Asia Department (CWRD), represented by the Transport and Communications Division (CWTC). CWTC has the overall responsibility for the implementation of the Project in ADB.

Transport & Communications Division (CWTC) Central and West Asia Department (CWRD)

Mr. Hong Wang Director, CWTC Tel No. (632) 632 6765 Email: [email protected] Mr. Dong Soo Pyo Principal Financial Analysis Specialist, CWTC Tel No. (632) 632 6807 Email: [email protected] Mr. Tomomi Tamaki Principal Transport Economist, CWTC Tel No. (632) 632 6218

4

Email: [email protected] Mr. Rustam Ishenaliev Transport Economist Tel No. (632) 632 6776 Email: [email protected] Ms. Leonor P. Alejandro Assistant Project Analyst, CWTC Tel No. (632) 632 6507 Email: [email protected] Ms. Maria Cecilia Villanueva Administrative Assistant, CWTC Tel No. (632) 632 6807 Email: [email protected] Mr. L. Blanchetti-Revelli Sr. Social Development Specialist (Resettlement), CWOC Tel No. (632) 632 6231 Email: [email protected] Mr. Joseph Weinstock Sr. Environment Specialist, CWOC Tel No. (632) 632 5478 Email: [email protected] Mr. George Kiziria Country Coordination Officer, Georgia Resident Mission I. Chkonia Project Implementation Officer, Georgia Resident Mission

Office of the General Counsel Mr. B. Konysbayev, Counsel Tel No. (632) 632 4907 Email: [email protected]

Controller's Department Loan Administration Division (CTLA-2)

Mr. Yoshinobu Tatewaki Financial Control Specialist, CTLA2 Tel No. (632) 632 4647 Email: [email protected]

Central Operations Services Office Consulting Operations Services Division 1 (COS1)

Mr. Walter Poick mailto:[email protected] Procurement Specialist Tel No. (632) 632 6462 Email: [email protected]

Address: Asian Development Bank No. 6 ADB Avenue, Mandaluyong City 1550 Metro Manila P.O. Box 789 0980 Manila, Philippines

Facsimile (CWTC): (632) 636 2428

5

Website Address: http://www.adb.org

B. Executing/Implementing Agency

Ministry of Regional Development & Infrastructure

Mr. Jambul Bakuradze Deputy Minister Tel No. +995 32 99 97 57 Email: [email protected]

Roads Department Mr. Irakli Litanishvili Deputy Chairman Tel No.+995 99 775 754 Email: [email protected]

IV. PROCESSING HISTORY

Approval of PPTA 28 January 2008Fact-Finding Mission 1-12 June 2009Management Review Meeting 7 July 2009Loan Negotiations (1st tranche) 12-14 August 2009Framework Facility Agreement signed 29 August 2009Board Circulation 8 September 2009Board Consideration and Approval 29 September 2009Loan Agreement Signing 29 October 2009Loan Effectiveness 1 December 2009 Annex 1: Project Definition

)

I. Sponsors, Stakeholders and External Agencies (i) Sponsors:

- Ministry of Finance (MOF) - Roads Department (RD), - Ministry of Economic Development - Ministry of Regional Development and Infrastructure (MORDI) - Eurasian Transport Corridor Investment Center (ETCIC) - Asian Development Bank (ADB)

(ii) Stakeholders: - Central government - Tbilisi and Batumi local/government offices - Autonomous Republic of Ajara - regions Kakheti, Kvemo Kartli, Mtkheta Mtianeti, Shida Kartli,

Samcke Javakheti, Racha Lechkhum, Kvemo Svaneti, Imereti, Guria, Samegrelo Zemo Svaneti

6

(iii) External Agencies

- World Bank - Millennium Challenge Corporation - Japan International Cooperation Agency

II. Impact and Outcomes

• Impact increased subregional trade, and accelerated regional cooperation and integration; better trade logistic corridors and cross-border movement of people and cargos.

• Outcomes: improved subregional road traffic through Georgia; increased trade flows and competitiveness; lower transport costs; increased mobility and accessibility to markets, jobs, and social services; and improved governance.

III. Outputs • Outputs of Tranche 1 will be (i) a new 2-lane bypass road of 28 km detouring

Kobuleti and 6 km of expansion of existing 2-lane road to 4-lane between Kobuleti and Batumi, (ii) better asset management capacity of the Road Department (RD); and (iii) improved road safety.

Annex 2: Project Management ______________________________________________________________________

2.1 Roles and Responsibilities

Investment Program

• MOF will be a focal point in coordinating with MOED, MORDI, ADB, World Bank, MCC, and JICA for implementation of the investment program. The annual donor coordination meeting organized by the World Bank will be a platform to harmonize each organization's assistance for the investment program.

Project Level

• (Procurement) The Procurement Unit under FPU will carry out procurement

related activities with the assistance of detailed design consultant and external experts engaged as necessary.

• (Engineering) The Engineering Unit under FPU will be responsible for all engineering related matters raised emanated from detailed design consultants and supervision consultants with the assistance of external experts engaged as necessary, particularly for tunnel and bridge engineering.

7

• (Land Acquisition and Resettlement) The Safeguard Unit under FPU will be responsible for land acquisition and resettlement related activities aided by land acquisition and resettlement experts of detailed design consultants, supervision consultants, and other external experts. The Ministry of Justice is responsible for legal matters regarding land ownership, and the National Agency of Public Registry within the Ministry of Justice is in charge of the registration of land ownership and its transfer through purchase agreement from landowners to the Roads Department. Local government at the rayon (district municipality) and village levels will also be involved.

• (Environmental Management) The Safeguard Unit under FPU will be responsible for environmental management related activities aided by land acquisition and resettlement experts of detailed design consultants, supervision consultants, and other external experts. The Ministry of Environmental Protection and Natural Resources will be consulted if complicated issues arise during construction and operation stages.

• (Financial Management) The Financial Management Unit under FPU will be responsible for disbursement and project accounting aided by ETCIC. ETCIC will maintain accounting records and prepare monthly and quarterly financial report and yearly project accounts.

• (Administration) The Administration Unit under FPU will be responsible for administrative matters.

Detailed Design

Consultant

Detailed Design

Consultant

External Expert (Tunnel and

Bridge)

External Expert

Supervision Consultant

External Expert

ETCIC

Procurement

Engineering

Safeguard

Financial Management

Administration

FPU

Roads Department

Road Safety Enhancement

Consultant

Capacity Development

Consultant

MORDI

World Bank

JICA

MOF

ADB MOED

Investment Program Implementation

Project Implementation

ETCIC = Eurasian Transport Corridor Investment Center; FPU = Foreign Project Unit; JICA = Japan International Cooperation Agency; MOED = Ministry of Economic Development; MOF = Ministry of Finance; MORDI = Ministry of Regional Development and Infrastructure.

2.2 Project Organization Structure/Project Management Office Organization Chart

9

Annex 3: Procurement Plan )

3.1 Process Thresholds and Reviews Thresholds. Except as the ADB may otherwise agree, the following process thresholds shall apply to procurement of goods and works.

Procurement of Goods and Works Method Threshold International Competitive Bidding for Works Above $1,000,000 International Competitive Bidding for Goods Above $500,000 National Competitive Bidding for Goods Beneath that stated for ICB, Goods Shopping for Works Below $100,000 Shopping for Goods Below $100,000

Reviews. Except as ADB may otherwise agree, the following prior or post review requirements apply to the various procurement and consultant recruitment methods used for the Project.

Procurement of Goods and Works Procurement Method Prior or Post Comments International Competitive Bidding for Works Prior International Competitive Bidding for Goods Prior National Competitive Bidding for Goods Prior Shopping for Works Prior Shopping for Goods Prior

Recruitment of Consulting Firms Quality-Based Selection Prior Quality- and Cost-Based Selection Prior

Recruitment of Individual Consultant Individual Consultants Prior

3.2 Procurement Plan

(i) Goods and Works Contracts Estimated to Cost More Than $1 Million

The following table lists goods and works contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Contract Value

($ million)

Procurement Method

Prequalification of Bidders (Yes/No)

Advertisement Date

(quarter/year)

Comments

Civil Works 104.6 ICB Yes 14 Feb 2010 (contract 1) 1 Jun 2010 (contract 2)

(ii) Consulting Services Contracts Estimated to Cost More Than $100,000

10

The following table lists consulting services contracts for which procurement activity is either ongoing or expected to commence within the next 18 months.

General Description

Contract Value

($ million)

Recruitment Method

Advertisement Date

(quarter/year)

International or National Assignment

Comments

Detailed Design and Bidding Documents for Tranche I and Tranche 2

3.5 QBS 14 Feb 2010 (contract 1) 1 Jun 2010 (contract 2)

International

Construction Supervision of Tranche I project

4.3 QCBS 14 Feb 2010 International Quality-cost ratio 80:20

Capacity Development for Road Network

2.0 QCBS, CQS or individual consultant

QII/2010 International Procurement method to be determined

depending on the need

Consulting Services for Road Safety Improvement

1.0 QCBS QIII/2010 International Quality-cost ratio 80:20

(iii) Consulting Services Contracts Less than $100,000 – NONE

(iv) Indicative List of Packages Required Under the Project

The following table provides an indicative list of all procurement (goods, works, and consulting services) over the life of the project. General Description Estimated

Value ($ million,

cumulative)

Estimated Number

of Contracts

Procurement Method

Domestic Preference Applicable

Comments

Works Package 1 (16 km for 00-10 km and 28-34 km)

30.8

Package 2 (18 km for 10-18 km)

73.8

2 ICB One-envelope single stage with prequalification

Yes

Consulting Services Construction Supervision of Tranche I project

4.3 1 QCBS or QBS with FTP

No Quality-cost ratio for

QCBS 80:20 Detailed Design for Tranche I and II projects

3.5 1 QBS with FTP No

11

Capacity Development for Road Network

2.0 Several QCBS or individual consultant

No Procurement method to

be determined depending

on the need Consulting Services for Road Safety Improvement

1.0 1 QCBS No Quality-cost ratio 80:20.

3.3 Advance Contracting and Retroactive Financing ADB approved advance contracting and retroactive financing for eligible expenditures. The Government acknowledges that ADB's approval does not commit ADB to finance the Investment Program or the Project.

Annex 4: Safeguards Plan ______________________________________________________________________ The PPTA consultants prepared the environmental assessment and review framework for MFF and the EIA including EMP for Project 1. The SEIA was disclosed on ADB website on 29 May 2009. Implementation of mitigation measures presented in the EMP and monitoring plan during construction will be the responsibility of the contractor. The representative of the Roads Department and environmental specialists of the supervision consultants will supervise the monitoring of implementation of mitigation and monitoring measures during construction. The national environment specialist will coordinate with the international environment specialist to resolve complicated issues that arise in the field and provide continuously updated information for reports to be submitted to the Roads Department and ADB.

4.1 Involuntary Resettlement. The PPTA consultants prepared the land acquisition and resettlement framework for the MFF and for Project 1 and were disclosed on ADB website. The land acquisition and resettlement plans for future projects will be prepared in accordance with the land acquisition and resettlement framework, and will be submitted to ADB for approval before the start of any civil works. The land acquisition and resettlement plan for Project 1 will be updated by detailed design consultants by January 2010. Land acquisition and resettlement activities will be completed by May 2010 for the section of Package 1 and by November 2010 for the section of Package 2.

4.2 Indigenous People No impacts on Indigenous Peoples are expected for the Program. The Program will primarily affect Georgian people which are almost 93% of the total population. Other

12

ethnic groups are insignificant in number. These groups have been fully integrated and mainstreamed into institutional, cultural, and economic processes in the country, and they do not display sufficient features to be classified as indigenous peoples as per the ADB’s definition on indigenous people.

Annex 5: Financing Plan )

5.1 Financing Plan, Fund Flow and Disbursement Arrangements A. Financing Plan

Project 1

Source Amount ($ million)

%

Asian Development Bank Special Funds Resources 118.8 80

Government 30.1 20 Total 148.9 100 Source: Asian Development Bank estimates

The Government will finance the land acquisition and resettlement, local taxes and duties, and some of contingencies in an amount of $30.1 million. This will be allocated to MORDI through yearly budgetary support as follows:

Amount ($million) Item 2009 2010 2011 2012 2013 Total Land Acquisition and Resettlement 0.0 10.1 0.0 0.0 0.0 10.1Taxes and Duties 0.5 2.3 5.8 5.8 4.1 18.5Contingencies 0.0 0.0 0.0 0.0 1.5 1.5

Total 0.5 10.1 5.8 5.8 5.6 30.1

13

B. Funds Flow

C. Disbursement Arrangements ADB’s Loan Disbursement Handbook (2007) will guide the disbursement of loan proceeds for the Project, following the provisions of Schedule 3 of the Loan Agreement. All payments to contractors and consultants will be through direct payment. Small petty cash payments for project management support will be through imprest account. There will be no withdrawals from the Project loan account until the Government certifies that (i) the Government has allocated adequate funds to a project account for land acquisition and resettlement activities, and (ii) the land and rights-of-way required for Project 1 road are free and clear from the rights or claims of third parties and any other encumbrances. Note: Withdrawal applications and other loan disbursement information are available at ADB Controller's Department's website http://lfis.adb.org. A disbursement monitoring information sheet should be used to reconcile ADB and EA's records.

MOF

Asian Development

Bank

MORDI

(EA)

Roads Department

(FPU)

Consultants/ Contractors

lending loan repayment

EA : executing agency FPU : foreign project unit IPC : interim payment certificate MOF : Ministry of Finance MORDI : Ministry of Regional Development and Infrastructure

Other Vendors

Treasury Service (MOF)

Check Payment

Treasury Check

Transfer to Imprest Account

Budget Allocation Withdrawal Application

Direct Payment Withdrawal

Application Treasury Check

Treasury Check IPC

14

5.2 Allocation Table

ALLOCATION AND WITHDRAWAL OF LOAN PROCEEDS (Project 1)

CATEGORY ADB FINANCING

Number Item Amount Allocated Category

Percentage and Basis for Withdrawal from the Loan

Account

1 Civil Works 55,002 82.3%

2 Consulting Services (detailed design, construction supervision, capacity development, and road safety enhancement)

6,900 100%*

3 Project Management Support 1,086 100%

4 Contingency 12,904

Total 75,892

*Exclusive of taxes and duties imposed within the territory of the Borrower

5.3 Other Financiers

• The World Bank, Japan International Cooperation Agency (JICA), and Millennium Challenge Corporation (MCC) will provide joint cofinancing equivalent to $622 million out of the $3.0 billion total investment program.

15

Annex 6: Investment Plan )

6.1 Detailed Cost Estimate

6.2 Forecast of Cost to Complete ($ million)

Total Years Cost 2009 2010 2011 2012 2013 2014 Total

A. Base Cost 1. Land acquisition & resettlement 10.1 6.1 4.0 0.0 0.0 0.0 2. Civil works 86.1 0.0 10.1 28.5 28.1 19.4 86.1

3. Detailed design & construction supervision 7.8 2.5 1.6 1.3 1.3 1.1 a. Detailed design 3.5 2.5 1.0 0.0 0.0 0.0 b. Construction supervision 4.3 0.0 0.6 1.3 1.3 1.1 4. Capacity development for road network management 2.0 0.0 0.0 1.0 1.0 0.0 5. Road safety enhancement 1.0 0.0 0.0 0.5 0.5 0.0 6. Project management support 1,7 0.0 0.6 0.6 0.3 0.2 7. Taxes and duties 18.5 0.5 2.3 5.8 5.8 4.1 Subtotal (A) 127.2 9.1 18.6 37.7 37.0 24.8 B. Contingencies 1. Physical 15.7 2. Price 5.9 Subtotal (B) 21.6 C. Interest during construction 2.3 0.1 0.4 0.7 1.1 Total Project Cost 151.1

% BaseCost

A. Base Cost a 1. Land Acquisition and Resttlement 0.0 16.6 16.6 0.0 10.1 10.1 7.92. Civil Works 54.3 87.8 142.1 32.9 53.2 86.1 67.7

a. Package 1 (00-10 km and 28-34 km) 16.0 25.8 41.8 9.7 15.7 25.3 19.9b. Package 2 (10-28 km) 38.3 62.0 100.3 23.2 37.6 60.8 47.8

3. Detailed Design and Construction Supervision 5.2 7.7 12.9 3.1 4.7 7.8 6.2a. Detailed Design 2.3 3.5 5.8 1.4 2.1 3.5 2.8b. Construction Supervision 2.9 4.3 7.1 1.7 2.6 4.3 3.4

4. Capacity Development for Road Network 1.3 2.0 3.3 0.8 1.2 2.0 1.6Management

5. Road Safety Enhancement 0.7 1.0 1.7 0.4 0.6 1.0 0.86. Project Management Support 0.3 2.5 2.8 0.2 1.5 1.7 1.4

a. Project Management Unit Support 0.3 1.3 1.7 0.2 0.8 1.0 0.8b. Environment Management 0.0 1.0 1.0 0.0 0.6 0.6 0.5c. External Auditing 0.0 0.2 0.2 0.0 0.1 0.1 0.1

7. Taxes and Duties 0.0 30.5 30.5 0.0 18.5 18.5 14.5Subtotal (A) 61.7 148.2 209.9 37.4 89.8 127.2 100.0

B. Contingencies 1. Physical b 9.9 16.0 25.9 6.0 9.7 15.7 12.32. Price c 3.7 6.1 9.8 2.3 3.7 5.9 4.7

Subtotal (B) 13.6 22.1 35.7 8.3 13.4 21.6 17.0

C. Interest during Construction 3.7 0.0 3.7 2.3 0.0 2.3 1.8

Total Project Cost 79.1 170.3 249.4 47.9 103.2 151.1 118.8

a In 2009 prices.b Computed at 15% of base costs. c Computed at 1.0% for 2010, 0.0% for 2011-2012, and 0.5% for 2013 for foreign exchange cost; and 7.0% for 2010 and 6.0% for 2011-2013 for local currency

costs..

Foreign Local

DETAILED COST ESTIMATE FOR PROJECT 1Detailed Cost Estimate by Expenditure Category

GEL million $ millionTotal Foreign Local Total

16

Annex 7: Implementation Plan )

7.1 Responsibility Allocation by Activity

Activities Responsible Parties EA FPU CON CNT ADB 1. Pre-Start Up 1.1 Board Approval * 1.2 Loan Signing * 1.3 Loan Effectiveness * 1.4 Establish Imprest Account * 1.5 Issue CSRNs * 2. PMU established 2.1 Set up PMU office * 2.2 Recruit PMU office staff * 2.3 Procure office equipment and materials * TRANCHE I (34 KM) - KOBULETI BYPASS 3. Preparation & Review of Detailed Design & Bid Documents

3.1 Engage Detailed Design Consultants & mobilize by 1 5 Feb 2010 *

3.2 Complete detailed design by 31 Oct 2010 * 4. Land Acquisition and Resettlement 4.1 LARP updated * 4.2 LAR activities implemented 5. Construction Supervision 5.1 Recruitment of Supervision Consultants * 5.2 Supervision of Project 1 * 4.3 Prequalification for Civil Works * 6. Contract 1 - Km 0-10 & Km 28-34 6.1 Bid Documents and ADB's Approval * 6.2 Civil Works Procurement * 6.3 Civil Works Implementation * 7. Contract 2 - Km 10-28 7.1 Bid Documents and ADB's Approval * 7.2 Civil Works Procurement * 7.3 Civil Works Implementation * 8. Capacity Development for Road Network 9. Road Safety Improvement 10. Project Management and Administration 10.1 Project Administration * 10.2 Construction Supervision * 10.3 Project Performance Monitoring * 10.4 Withdrawal and Disbursement * 10.5 Accounting and Auditing * 10.6 Covenant Compliance * 10.7 Midterm Review * 10.8 Project Completion * 10.9 Loan Account Closing * ADB = Asian Development Bank, CNT = Contractors, CON = Consultants, CSRN = Consulting Services Recruitment Notice, EA = Executing Agency (RD), PMU = Project Management Unit * with primary responsibility

7.2 Execution Plan (Investment Program)

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Approval of Advance Procurement

Project 1 - (39 km)

Section 1, ADB Financed (km 400 - km 439)

Recruitment of Supervision Consultants

Supervision and Preparation of Project 2

Review Detailed Engineering Design

Bid Documents and ADB's Approval

Civil Works Procurement

Civil Works Implementation

Policy and Institutional Support

Consulting Services for Transport Master Plan

Consulting Services for Institutional Support

Project 2 - (200 km)

Section 2A, ADB Financed


Supervision and Preparation of Project 3





Section 2B, Cofinancier

Policy Support for Institutional Reforms

Support for Implementation of Policy Reforms

Project 3 - (235 km) including Bishkek western bypass

Section 3A, ADB Financed


Supervision of Project 3





Section 3B, Cofinancier

20142011 201320122008 2009 2010Activity

defects liability period



18

7.3 Execution Plan (Project 1)

19

7.4 Annual Work Plan

1st Tranche 2nd Tranche Responsible Parties

Activities Contract 1 Contract 2 EA IA CONS CONT ADB

Sign Loan Agreements 29 Oct 2009 *

Loan effectiveness 1 Dec 2009 * Post CSRNs for supervision consultants 14 Feb 2010 *

Issue RFP for supervision consultant 1 May 2010 *

Contract award for supervision consultant 31 July 2010 *

Approval of LARP 30Jun09 30 Jun09 15 Jul09 *

Completion of LARP 30Jun09 30 Jun09 15 Jul09 *

Field detailed design consultant : 15 Feb 2010 *

Complete detailed design 31May 10 31Oct10 31Dec10 * Updated LARP finalized and approved 30Apr10 31Jul10 30Sep10 *

Start tendering 1Jun10 1Nov10 1Jan11 *

Contract award 31Aug10 31Jan11 31Mar11 *

Start construction work 1Sep10 01Feb11 01Apr11 *

Completion of construction work 31Aug13 31Jan14 31Mar14 * EA= executing agency; IA=implementing agency; CONS=consultant; CONT=contractor

* with primary responsibility

Annex 8: Performance Monitoring and Evaluation )

8.1 Deliverables

• Increase in subregional trade by 4% for 5 years after completion of the first tranche project

• 30% increase in cross-border freight traffic by 2015 from 1.0 million tons in 2008

• 10% yearly increase in registered visitors to Adjara region for 5 years after completion, from 285,000 in 2008

8.2 Performance Indicators Outcome:

• Reduced freight charges per ton-km in Georgia by 10% from 2009 to 2015 • Increased share of subregional roads in good and fair condition from 80% in

2008 to 90% in 2015 • Increased funding for road maintenance from $32 million in 2009 to $52 million

in 2013 • Decrease in road accident rate from 1.3 per million vehicle-km on the existing

road to 0.68 on the Adjara bypass road in 2014

20

• Increase in traffic volume on the Batumi and Kobuleti bypass to 3,600 vehicles by 2014, 5,700 vehicles by 2024, and 8,500 vehicles by 2034

• Decrease in travel time for the Choloki–Sarpi trip to less than 0.6 hour after project completion

Outputs: • IRI value for the improved roads maintained at no higher than 3.0 within 5 years

after project completion • Increase in road capacity to 12,000 vehicles per day after project completion • Reduction in vehicle operating costs for a car from $0.42 per km to $0.32 per

km after project completion • Number of beneficiaries: 378,000 • 60 person-months of international training for Roads Department staff • Implementation of performance maintenance contracts • Development of road accident monitoring, reporting, and information system by

2013 • Provision of road safety public campaign and training by project completion in

2011

8.3 Monitoring and Evaluation Report Project Performance Report (PPR) – The Roads Department will (i) hire consultants for monitoring and evaluation; (ii) collect additional data from relevant agencies, including local governments and statistics bureaus, to measure the performance indicators at inception, completion, and 3 years after the completion of each project and the investment program; and (iii) report key findings quarterly to ADB. The department, with the assistance of the supervision consultant, will monitor and evaluate program impact to ensure that the program facilities are managed effectively and the program benefits maximized.

Annex 9: Major Covenants

9.1 Legal Covenants

• The Borrower shall ensure that all Goods and Works procured (including without limitation all computer hardware, software and systems, whether separately procured or incorporated within other goods and services procured) do not violate or infringe any industrial property or intellectual property right or claim of any third party.

• The Borrower shall ensure that all contracts for the procurement of Goods and Works contain appropriate representations, warranties and, if appropriate, indemnities from the contractor or supplier with respect to the matters referred to in subparagraph (a) of this paragraph.

• The Borrower shall ensure that all ADB-financed contracts with consultants contain appropriate representations, warranties and, if appropriate, indemnities from the consultants to ensure that the consulting services provided do not

21

violate or infringe any industrial property or intellectual property right or claim of any third party.

• If any of the following is anticipated: (i) any change in ownership of the road, road facility, or structure financed under the Project; (ii) any sale, transfer, or assignment of interest or control in the road, road facility, or structure financed under the Project; or (iii) any lease or other contract or modification of the functions and authority of the RD over operation and maintenance of any road, road facility, or structure financed under the Project; then the Borrower shall ensure that ADB’s consent is obtained at least six (6) months prior to the implementation of such a plan. The Borrower shall ensure that any such changes will be carried out in a legal and transparent manner.

9.2 Financial Covenants

• The Borrower shall (i) maintain, or cause to be maintained, separate accounts for the Project; (ii) have such accounts and related financial statements audited annually, in accordance with appropriate auditing standards consistently applied, by independent auditors whose qualifications, experience and terms of reference are acceptable to ADB; (iii) furnish to ADB, as soon as available but in any event not later than six (6) months after the end of each related fiscal year, certified copies of such audited accounts and financial statements and the report of the auditors relating thereto (including the auditors' opinion on the use of the Loan proceeds and compliance with the financial covenants of this Loan Agreement as well as on the use of the procedures for imprest account/statement of expenditures), all in the English language; and (iv) furnish to ADB such other information concerning such accounts and financial statements and the audit thereof as ADB shall from time to time reasonably request.

• The Borrower shall ensure that all contracts financed by ADB under the Program include provisions specifying the right of ADB to audit and examine the records and accounts of the IA and all contractors, suppliers, consultants, and other service providers as they relate to a project in question.

• The Borrower shall ensure that actual annual expenditures for road maintenance (including emergency maintenance, but excluding rehabilitation and new construction) for roads within RD's jurisdiction are increased at least at the same rate as increases in the overall national budget during 2010–2015.

9.3 Safeguards Covenants

• The Borrower shall ensure that the Project is designed, carried out, maintained, and monitored in compliance with (a) all applicable environmental laws and regulations; (b) ADB’s Environment Policy (2002); and (c) the EMP, including the mitigation measures and monitoring requirements arising from the implementation of the EIA. The Borrower shall also cause RD to ensure that: (y) Works contractors’ specifications include requirements to comply with the environmental mitigation measures contained in the EIA and EMP, and (z) Works

22

contractors are supervised to ensure compliance with the requirements of the EIA and EMP.

• The Borrower shall ensure that land acquisition and resettlement are carried out promptly and efficiently following the land acquisition and resettlement plan agreed with ADB in line with applicable laws and regulations and ADB’s Involuntary Resettlement Policy (1995). The Borrower shall ensure that implementation of the land acquisition and resettlement plan is monitored, evaluated, and reported to ADB as required in the resettlement plan. The Borrower shall also ensure that all land and right-of-way required for project implementation are made available to the Project in a timely manner.

• No withdrawals shall be made from the Loan Account until ADB has received Borrower's certification that (i) adequate funds shall have been allocated to the Project account for land acquisition and resettlement activities, and (ii) all land and rights-of-way required for implementation of the Project shall have been obtained free and clear of any liens, rights, claims or any other encumbrance whatsoever.

• The Borrower shall not award any Works contracts financed under the Loan until (a) the corresponding EIA has been approved by ADB; and (b) the corresponding land acquisition and resettlement plan has been approved by ADB.

• The Borrower shall ensure that contractors commence the Works only after the land acquisition and resettlement plan has been implemented with respect to the relevant road section in accordance with its terms.

• The Borrower shall ensure that RD installs appropriate road safety signs and facilities during the Project implementation and after completion, such as warning signs, pavement markings, road signs and signals, communications facilities, hazard barriers, and traffic monitoring facilities, all in compliance with industry's best practices and relevant international conventions to which the Borrower is a party. The Borrower shall ensure that, at least six (6) months prior to the opening for operation of the Project Road, (i) RD will have developed and implemented a plan, acceptable to ADB, for ensuring safe operation of road infrastructure facilities; and (ii) relevant Borrower's authorities will have prepared to police the Project Road and enforce the national laws and regulations. The Borrower shall ensure that RD monitors the accident rate and traffic volume after commencement of the operation of the Project Road and institutes appropriate safety enforcement measures.

• The Borrower shall ensure that RD establishes vehicle weighing stations within the Project Road to control the axle overloading and institute appropriate procedures and regulations to enforce the axle load control by the completion of the Project.

• The Borrower shall ensure that (i) the Project road is rehabilitated or constructed in accordance with the technical specifications of the design; and (ii) construction supervision, quality control and contract management are performed in accordance with internationally acceptable standards.

• The Borrower shall adopt the road maintenance privatization strategy by 31

December 2010. Prior to the completion of the Works under the Project, RD shall have used its best efforts to enter into a pilot performance-based maintenance

23

concession with a private sector entity for the Project Road or any other road, or portion thereof, rehabilitated or constructed under the Facility. The Borrower shall cause RD to submit the bidding documents and the concession framework to ADB by the end of 2012.

• The Borrower shall ensure that all local consultations with respect to safety,

social, and cultural issues during Project implementation are carried out as recommended in the summary poverty reduction and social analysis prepared for the Project. The mechanisms for maximizing local employment benefits shall be included in the bidding documents.

• The Borrower shall ensure that all Works contractors (i) comply with all applicable labor laws; (ii) use their best efforts to employ women and local people, including disadvantaged people, living in the vicinity of the Project; (iii) disseminate information on the risks of sexually transmitted infections to those at worksites employed during construction; (iv) provide equal pay to men and women for work of equal type; (v) provide safe working conditions for male and female workers; and (vi) abstain from child labor. Relevant Works contracts financed under the Project must include specific clauses on these undertakings, and compliance will be strictly monitored during implementation.

• The Borrower shall ensure that the Works contracts include a requirement to conduct an information and education campaign on sexually transmitted diseases and HIV/AIDS for construction workers as part of the health and safety program at campsites during the construction period.

• The Borrower shall undertake concrete and adequate measures to detect and prevent trafficking of humans, wildlife, endangered species, and illegal substances on the Project Road.

• The Borrower shall prepare a long-term road sector master plan for 2011–2020 and adopt it for implementation by 31 December 2010. Such plan shall detail policy actions and measures to: (i) establish a system for efficient planning and prioritization of road maintenance works; (ii) provide funding modalities to finance the maintenance of relevant roads acceptable to ADB; (iii) develop or adopt adequate road maintenance standards and prepare relevant road maintenance planning and operational manuals; and (iv) provide training to strengthen the capacity of local maintenance units.

24

Annex 10: Appendices

Appendix 1 Terms of Reference for Construction Supervision Appendix 2 Terms of Reference for Consultants for Capacity Development for Road Network Management Appendix 3 Terms of Reference for Consultants for Road Safety Enhancement Appendix 4 Environmental Assessment Review Framework Appendix 5 Land Acquisition and Resettlement Framework

Appendix 1

OUTLINE TERMS OF REFERENCE FOR CONSULTANTS FOR CONSTRUCTION SUPERVISION OF TRANCHE I AND TRANCHE II

A. Introduction 1. International and domestic consultants will assist the Executing Agency (EA) in ensuring that (i) designs are carried out to the appropriate engineering standards; (ii) all work associated with the project are carried out in full compliance with the designs and specifications; (iii) the EA's engineers and domestic consultants receive in-country and international training in selected areas of tunnel design and construction and pavement design; (iv) resettlement, social, environmental, road safety, and monitoring are implemented in accordance with the recommendations of various studies, plans, analysis of the project. A total of 180 person months are required for international consultants and an estimated 1,520 person months for domestic engineering consultants 2. The consultants will be engaged under ADB financing and will be recruited in accordance with the EA’s procedures acceptable to ADB. B. Scope of Services and Staffing Requirements International Consultants 3. The international consultants will act as adviser to the EA, and support and assist staff in the performance of their duties. About 183 person months of international consulting services will be required to provide advisory services in construction supervision. The team of international consultants will comprise a highway construction project management specialist as Chief Engineer for 52 person months; 48 months for a highway engineer, 36 months for a bridge engineer, 18 months for a tunnel engineer, 6 month for a road pavement specialist, 3 months for a contracts specialist, 2 months for a road safety specialist, 12 months for an environmental specialist, and 3 months for a social specialist. 4. The Chief Engineer, will be appointed over the whole construction period. While being responsible for coordinating the inputs and the activities of the international and domestic specialists, he will also assist the EA in:

• developing and implementing a computer-aided contract management system for monitoring the civil works contracts and overall project implementation, and generating monthly and quarterly progress reports;

• organizing, coordinating, and monitoring the construction supervision activities in accordance with the conditions of contract of Federation International des Ingenieurs-conseils (FIDIC);

• assist in settling contractors’ claims; • reviewing and certifying engineering variation orders, contractor’s applications for

subcontracting parts of the works, and monthly payments to the contractors for submission to the EA. Assist EA in settling disputes with contractors;

• preparing documents and progress reports to be submitted to ADB; • monitor performance, deadlines, project progress, as well as conduct seminars,

assess training impacts and assist in the development of a risk management plan to avoid any unexpected incidence that may have a negative impact on the project development.

5. The highway engineer will be fielded for a period of 48 person months to assist the chief engineer in the construction of the highway works. He will each be responsible for both bypass sections.

Supplementary Appendix B

6. The bridge engineers will be fielded for a period of 36 person months to review the final bridge design, oversee the bridge construction supervision, implement quality control procedures, improve construction methods and to train the domestic site engineers on bridge construction and maintenance. 7. The tunnel engineer will be fielded for a period of 18 person months to review the final tunnel design, oversee the tunnel construction supervision, review the safety procedures set up by the contractor, set up a risk management plan, improve construction methods and to train the domestic engineers on tunnel construction and maintenance. 8. The pavement specialist consultant will be required for a period of 6 person months to review the final pavement design, review pavement construction techniques and oversee the domestic consultants in supervision of pavement construction. 9. The contracts specialist shall assist the chief engineer in revieing the contract document and assisting in the evaluation of claims and disputes. 10. The road safety specialist will be required for a period of 2 person months and recruited upon completion of the detailed design and before the start of the works, to conduct a road safety audit, and advise on road safety issues of the expressway operations. The specialist will provide a second input to inspect the completed works before the facilities are opened and, where appropriate, recommend additional traffic engineering and ITS improvements, particularly for lighting, hazard barriers, signage, and marking. 11. The environmental specialist will be required for a period of 12 person months and will carry out environmental monitoring and management of project implementation and help ensure the implementation of environmental management practices at each stage of the construction. The specialist will develop an environmental auditing protocol for the construction period, formulate a detailed environment monitoring and management plan (EMMP), regularly supervise the environmental monitoring, and submit periodic reports based on the monitoring data and laboratory analysis reports. The specialist will also develop a program for hands on training of contractor’s staff in implementing the EMMP. 12. The social/resettlement specialist will be responsible for the development and implementation of the Project Monitoring System (PMS) and monitoring and evaluating HIV/AIDS/STI prevention programs and transmittable disease detection and prevention programs. 13. In-country training programs will be submitted to ADB for review and concurrence. The international consultants will conduct workshops in their fields of expertise. Domestic Consultants 14. The domestic consultants will be composed of graduate engineers or the equivalent, with at least 5 years of practical experience in supervision and administration of major road, bridge, and tunnel contracts. Construction Supervision 15. The consultants will supervise all construction activities. 16. Construction supervision activities will include the following:

• Assist the EA with contractors’ applications for subcontracting parts of the civil works, by reviewing ambiguities and discrepancies in contract documents, and in settling disputes with contractors.

• Ensure that all required data for setting out the civil works are provided.


• Help the EA with drawings quality, and advise the EA on further drawing or instructions to the contractors.

• Assist the EA to review the contractors’ organizational arrangements, key personnel and construction programs, materials, and sources of materials.

• Monitor the progress of the works against programmed targets, advise the EA on measures to be taken to improve progress and quality, review and advocate proposed variation orders, determine rates for works, and decide on alternatives.

• Inspect the quality of the works in terms of workmanship and compliance with specifications; order, supervise, or perform tests on materials and civil works; advise on approval or disapproval of the contractors’ plan and equipment; propose, if required, the uncovering of completed civil works and the removal and replacement of improper material and works.

• Check the progress of civil works, examine and review sampling measurements of any work that is about to be covered or put out of view before permanent work is placed thereon, examine the measurements of the completed civil works, and (as directed by the EA) order the initiation of additional civil works that are part of the contract.

• Supervise the contractors in all matters concerning safety and care of civil works including the provision of necessary lights, guardrails, fencing, and security.

• Examine the contractors’ accounts, invoices, claims, and other statements for errors in complying with the contract, and suggest and make corrections.

• Advise the EA on how and when to issue certificates of payment to the contractors and certify the completion of the civil works or parts thereof.

• Provide advice and help for the local government authorities to facilitate implementation of works.

Project Monitoring System 17. The consultants will be responsible for the development and implementation of the Project Monitoring System (PMS) and will initially collect and analyze a set of indicators for evaluating project performance against project objectives, purposes, and outputs. The indicators set out in project documents will be reviewed and a baseline survey will be conducted at the beginning of project implementation to collect data not already supplied. Domestic consultants will be recruited to conduct follow-up surveys at project completion, and one year and three years after completion. Data collected during and after implementation will be compared with the baseline data and the target values to be established by the EA and agreed upon with the Asian Development Bank (ADB) before the works start. The main indicators to be monitored include (i) economic development and poverty indicators at the municipality level and for each county in the project area; (ii) transport costs and time for specific types of vehicles and trips; (iii) transport services and charges; (iv) air quality; (v) changes in producer prices, and (vi) jobs created during construction and maintenance. Where relevant, indicators will be differentiated by gender. The data collection method will consist of (i) reviewing secondary data from local government statistics; (ii) conducting household socioeconomic sample surveys; and (iii) developing participatory rural appraisal methods among communities affected by the bypass roads. About 24 person-months of domestic consultants specializing in socioeconomic and transport fields will be required to develop and implement the PMS. Records and Reports 18. The construction supervision consultants will maintain records of implementation progress, contract variations, and design revisions for incorporation in the drawings for the final works. They will also (i) assist the EAs in preparing progress and financial status reports, and a final project completion report; (ii) certify interim and final payments; (iii) give the EAs technical and engineering advice on the day-to-day project activities; (iv) keep


records of all works done, and prepare monthly and quarterly progress reports; (v) prepare, before the works start, a project implementation schedule based on the contractors’ work programs; and (vi) keep records of all payments approved and report the same in the monthly progress reports. The monthly reports will cover a description of the activities, the progress charts, the expenditure records, and implementation-related issues and the suggested remedial actions. The monthly reports will be consolidated into quarterly reports comparing the actual and originally anticipated work program. 19. Upon completion of their inputs, the individual international consultants will prepare for each relevant technical area, progress reports giving findings and recommendations. Upon completion of their services, the consultants will submit a final report covering the work performed, and highlighting findings and recommendations to the EA. Copies of these reports and actions taken should be provided to ADB. 20. A strategic plan regarding performance measures, effectiveness, training, and various activities of the Chief Engineer should be developed during the first two months of the duty commencement, and ADB should be informed. Support Services for the Consultants 21. The EA will make the following available to the consultants: (i) administrative assistance to international consultants in obtaining visas, customs clearance, and any other administrative permits required to perform their duties; (ii) all relevant reports; documents relating to the assignment, (iii) suitable office accommodation on site and in Tbilisi and (iv) appropriate and suitably qualified counterpart staff. Counterpart staff will be agreed upon with the EAs before the services start.


Table 1 Summary of International Consulting Services

Consultant No. Person Months

1. Chief Engineer/Road Engineer 1 52 2. Highway Engineer 1 48 3. Bridge Engineer 1 36 4. Tunnel Engineer 1 18 5. Pavement Engineer 1 6 6. Contracts Specialist 1 3

7. Road Safety Engineer 1 2 8. Environmentalist 1 12 9. Social Specialist 1 3 TOTALS 9 180

Table 2 Summary of Domestic Consulting Services

Consultant No. Total Person Months

1. Deputy Chief Engineer 1 50 2. Deputy Resident Engineers 4 192 3. Highway Supervising Engineers 16 768

4. Bridge Supervising Engineer 6 180 5. Tunnel Supervising Engineer 4 144 6. Pavement Engineer 2 24 7. Geotechnical Engineer 1 12

8. Drainage Engineer 2 16

9. Quality Control Specialist 1 48

7. Road Safety Engineer 1 2 8. Environmentalist 2 72 9. Social Specialist 2 12 TOTALS 41 1,520

Appendix 2

OUTLINE TERMS OF REFERENCE FOR ROAD SECTOR CAPACITY BUILDING

A. Consulting Input

1. The TA will be implemented by a consultant team consisting of a team leader (international road engineering specialist, 3 person-months), tunnel design/construct specialist (1 international for 1.5 person-month), bridge design/construct specialist (one international and one national for 1.5 person month each), pavement design/construct specialist (one international for 4 person months and one domestic for 6 person months) international contract management specialist (one international for 1 person-month), social/resettlement specialist (1 international for 4 and one national for 8 person months person-months), environment specialist (one international for 2 person months and one national for 3 person months).

B. Implementation Arrangements

2. The Consultant will head a team comprised of international and domestic staff along with RD (the EA), Ajara Autonomous Region and other counterpart specialists who will work closely with the Consultant. These counterpart staff will be drawn from existing resources. After proper training, the Georgian counterpart staff are expected to be capable of training further groups of RD and other professional counterparts.

C. Scope of Services

3. At the present time international agencies intend to or are funding a substantial number of both international and state roads in Georgia in order to improve the overall road network. Many of these roads are high speed international roads, some are limited access. There is limited experience in Georgia in the design and construction of high speed roads, and road tunnels.

4. The project roads will carry a large amount of heavy truck transit traffic. There is no information on the extent of vehicle overloading on main roads in Georgia and despite Georgia having an axle load limit of 11.5 tons there are few means of measuring actual loads. As pavement overloading can cause accelerated damage to the pavement it is important to both know the extent of truck overloading and control it.

5. The project roads will require extensive environmental and social/resettlement monitoring both during construction and in the first years of operation. Whilst there is some experience in safeguard monitoring in Georgia, it has little depth and, in particular there is no experience in ADB safeguard requirements.

6. It is proposed to engage consultants to develop and implement a human resource development plan to include domestic formal and hands on training in areas of design and construction and environment and social monitoring of impacts of high speed roads. The consultants may be engaged as part of the supervisory services for the ADB funded Kobuleti bypass road.

7. The objective of the assignment is for the Consultant to train counterparts so as to establish in-country expertise for further domestic training in high speed road design and construction, international contract management, environmental monitoring and social/resettlement monitoring. The focus of the work shall be on ensuring that RD and other

Appendix 2

professionals are fully trained such that they can become trainers themselves. The ‘knowledge transfer’ to be proposed by the consultant in their proposal will be considered an essential measure of the viability of achieving the outputs. In addition the consultants will train counterparts in the use of portable weighbridges to be procured as part of the services and assist them in carrying out an axle load survey on the existing Batumi-Kobuleti road and other international roads in Georgia.

8. The objectives of the environment training are (a) to help build up the capacity and procedures of the Environmental and Resettlement Unit (ERU) of RD and Ajara Autonomous Region officials to undertake analyses of environmental impacts of road projects and to prepare environmental management and monitoring plans, land acquisition and resettlement impacts and social monitoring in accordance with Government regulations and donor guidelines, and (b) to provide hands-on-training on environmental management to the ERU, RD, and the contractor.

9. The objective of the social/resettlement training is to allow effective execution of all Land Acquisition and Resettlement (LAR) related tasks by developing an expansion of the capacity on LAR currently available at the EA (RD), Ajara Autonomous Region and in the Rayons. D. Scope of Work

10. The international and national consultants will work with domestic counterparts from RD to prepare and present a training program for staff of RD and other selected Georgian professionals from other agencies. The subjects to be selected for training are indicated below but will be finalized during negotiations. All training materials will be translated into Georgian and provision for such translation should be included in the consultants offer.

11. The training will consist of four parts (i) developing a human resource development plan, including domestic formal and hands on training, (ii) domestic training sessions to be given by the international specialists to RD counterparts, (iii) assist in carrying out an axle load survey and (iv) evaluation of the training program.

12. The human resource development plan will include all in-country training programs. The formal specialist training programs will be submitted to EA and ADB for review and concurrence. Candidates trained will be required to submit a report, through the consultants, to the EA and ADB on the training received. The trainees should be able to serve as resource persons in further training seminars for dissemination of knowledge learned.

13. The international teal leader will take overall responsibility for the training including preparing an overall training program in consultation with the other international experts, assisting in all training sessions and preparing an evaluation report.

(1) Road Design and Construction Training 14. Training will be carried out to suitable counterparts from RD and will consist of bridge and tunnel design and construction techniques, road pavement design and construction techniques, international bidding and contract management. Training will include:

• Bridge design and construction techniques of high/long bridges

• Tunnel design and construction techniques of tunnels over 0.5km in hard and soft rocks

• Bridge and tunnel design in seismic active areas

• The evaluation of suitable pavement surface types

• International pavement design standards

Appendix 2

• Pavement construction techniques and the effect of overloading on pavements.

• A review of FIDIC contract documents

• Construction variations, claims and disputes

• Contract management techniques

(2) Environment Monitoring Training

15. The consultant’s scope of work will include the following tasks:

• reviewing prevailing government regulations and donor guidelines governing the assessment and management of environmental and social impacts of road projects;

• identifying the procedures and tasks required to be performed by ERU and RD to meet the requirements of these regulations and guidelines;

• reviewing the skills of ERU and RD officials and assessing the need for training to establish the capability to meet environmental and social management and monitoring requirements;

• preparing a short-term staff training plan and associated materials to meet immediate needs;

• undertaking the training through a combination of hands-on assistance, on-the-job training, and training workshops;

• evaluating the effectiveness of the training provided by other agencies measuring improvements in attitudes and skills achieved;

• preparing outline proposals for the longer-term development of ERU’s organization and capabilities.

(3) Social and Resettlement Training

16. The first task will be to carry out a capacity need assessment to define the capacity building activities required. Capacity building exercises will be needed at the Road Department, Ajara Regional and Rayon level. The designated team at the Rayon level for the LAR activities will be provided with training related to the LAR planning and implementation and will be made familiar with ADB’s policy on Involuntary Resettlement. This will be done through on the job training and by participation with the LAR activities.

17. Training will cover the following topics:

• ADB’s Policy on Involuntary Resettlement (1995) and other safeguards Policies related to IP and Gender etc.

• Principles and procedures of land acquisition;

• Public consultation and participation;

• Entitlements and compensation & assistance disbursement mechanisms;

• Grievance redress;

• Implementation Mechanism of LARP and

• Monitoring of resettlement operations.

Appendix 2

(4) Axle Load Survey and Analysis

18. Training in pavement design and the effect of overloading on pavement design will be covered under item I above. In addition the pavement specialist will:

• Specify and assist RD in the procurement of three portable vehicle weighing equipment;

• Train RD staff in the use of the equipment;

• Develop a continuing program for truck axle load checking on the existing Poti-Batumi Road and also on selected locations of the E-W Highway. Obtain approval from RD on the program.

• Supervise the execution of the load checking program.

• Train RD staff in the analysis of the initial results and preparation of a report setting out the extent of overloading on the roads.

D. Staffing

19. The international road engineering consultants shall have a minimum of 15 years experience in their respective fields in which 5 years should be on international projects involving high speed roads.

20. The international environmental specialist will have a minimum of 10 years experience in environmental assessment and management of infrastructure projects and must possess a relevant post-graduate degree preferably doctorate in civil /environmental engineering.

21. The international social/resettlement specialist will have a post graduate in Social Science with a minimum 10 years of relevant work experiences in the social sector especially in land acquisition and resettlement planning and implementation. Up- to- date knowledge of various social safeguards policies of Asian Development Bank and Georgia Laws/regulations on Land Acquisition and Resettlement is required. Experience in implementation of LARP activities and experience in ADB funded project implementation will be desirable.

Appendix 3

OUTLINE TERMS OF REFERENCE FOR CONSULTANTS For Road Safety Enhancement

A. Consulting Input 1. The TA will be implemented by a consultant team consisting of a team leader (international road safety specialist, 7 person-months), road safety equipment specialist (1 international for 1 person-month), ITS specialist (international for 3 person months, one national for 2 months), road safety trainers (2 national for 8 person-months each), media specialist (1 national for 2 person-months) B. Implementation Arrangements 2. The Consultant will head a team comprised of international and domestic staff along with RDMEDI and PP and other counterpart specialists who will work closely with the Consultant. These counterpart staff will be drawn from existing resources. After proper training, the Georgian counterpart staff are expected to implement the outputs from the preparation assignment under close monitoring of the Consultant. The Consultant will therefore guide the counterpart team, review and comment on outputs, and help the counterpart team to produce the outputs to the necessary standard. C. Scope of Services 3. The new Project road comprises two sections - (i) access-controlled Kobuleti bypass (28km) and (ii) the free-access six kilometer widening of the existing road. The first of these sections will be restricted, with no admittance to pedestrians, slow and non-motorized traffic, while there will be mixed traffic and pedestrians in the second section. 4. The objective of the assignment is for the Consultant to develop awareness campaigns and also establish in-country expertise for further road safety campaigns, train counterparts in road safety monitoring, specify equipment required for road safety enforcement and develop an ITS strategy. The focus of the work shall be on ensuring that RDMEDI, PP and other professionals are fully involved in the preparation of the campaigns so that they are able to do most of the work of implementation and follow up. This ‘knowledge transfer’ to be proposed by the consultant in their proposal will be considered an essential measure of the viability of achieving the outputs. D. Scope of Work 5. The objective of the assignment is for the Consultant to develop awareness campaigns and also establish in-country expertise for further road safety campaigns, train counterparts in road safety monitoring, specify equipment required for road safety enforcement and develop an ITS strategy. The focus of the work shall be on ensuring that RDMEDI, PP and other professionals are fully involved in the preparation of the campaigns so that they are able to do most of the work of implementation and follow up. This ‘knowledge transfer’ to be proposed by the consultant in their proposal will be considered an essential measure of the viability of achieving the outputs.

(1) Road Safety Audits (One person month international, 2 person months national trainers)

Appendix 3

6. Training will be carried out to suitable counterparts from RDMRDI, PP, Technical University and NGOs in the use of road safety audits, based on the manuals prepared by WB consultants. The counterparts will then under the supervision of the consultants carry out an audit of the details design of the new road and also of the existing S2 road from Poti to Sarpi.

7. The timing of this component will depend on the completion of the Manuals by WB consultants.

(2) Awareness Campaigns (6 person-months of Team Leader, 16 person months

of national trainers and media specialist.) 8. The safety awareness campaign for the access-controlled section should take into consideration safety-issues related to high-speed traffic and the likely implication to both the road-users and roadside communities. The target-groups would therefore be (i) road-users and drivers of all types of vehicles and (ii) roadside communities. 9. For the former the issues which should be addressed are a safe driving code of behavior while driving on an access-controlled road including road tunnels and carrying out education about safety facilities and response in the event of incidences such as accidents. 10. For the roadside communities, the issues to be addressed would be to educate the communities on the dangers of accidentally or forcefully breaking through the safety boundary fence to the access-controlled road. This would include publicizing the construction of sufficient pedestrian and tractor underpasses and non-disruption of the existing local roads, foot-trails, etc. 11.Suggested campaigns will include (but are not limited to):

(i) Safety Code for Access-Controlled Roads & Tunnels. Educating drivers about the correct code of behavior while driving in the access-controlled sections of road including tunnels. It should consist of design of materials to be used in program and the actual education should be conducted to all road-users through joint collaboration with the consultants, PP and RDMRDI.

In the initial period, the education should be carried out through concerned associations of transport entrepreneurs and PP. In the latter part of the Program, the Consultants should in consultation with PP, update the existing manuals for drivers incorporating the above code. With the collaboration with PP the syllabus for the written test for driving-licenses should be updated to include the safe driving code, with special reference to high speed roads.

(ii) Roadside Community Awareness Campaign. This program will carry out safety

education of roadside communities within the access-controlled section of the Project and would target school children and concerned residents within the immediate vicinity of the road. The campaign should be conducted through local community based organizations in collaboration with RDMRDI, PP and the Consultants. It should consist of preparation of brochures highlighting a code of conduct around access-controlled roads, lectures and training to local trainers (PP or NGOs), supervision of implementation of awareness campaign by local trainers to students and residents.

Appendix 3

(iii) Pedestrian Awareness Campaign for Open Access Section of Road. This campaign should use posters and literature related to increased danger from heavy-vehicles and safe pedestrian behavior when walking by heavily trafficked roads. This program should be conducted in schools in Kobuleti and Batumi: Activities should include, preparation of posters and other literature, conduct lectures at schools with the assistance of MRDIRD and PP.

(iv) Awareness Campaign for Heavy Vehicles. The main message behind this

campaign will be to underscore the importance of observing safe-driving habits with special consideration given to pedestrians and non-motorized vehicles on mixed traffic road sections. This campaign should be conducted at truck and bus operator’s depots and should include preparation of brochures and stickers and lectures at transport operators depots with the assistance of RDMRDI and PP.

(v) Publicity through Television and Newspaper. The Project should produce and

broadcast a documentary on television highlighting the following issues pertaining to the Project roads, including code of driving behavior on high speed roads and tunnels and information on emergency facilities available on high speed roads.

For newspaper publicity a set of road safety advertisements/information should be designed and placed in national and regional papers.

(3) Assistance in enforcement by PP by procurement of road safety enforcement equipment. (One month international)

12. The consultants will specify a list of road safety enforcement in-vehicle equipment including radar guns, breathalyzers and computerized vehicle data recoding equipment. The budget for this item would be around $25,000.

(4) Adoption of ITS Standards (3 person months international, 2 person months domestic)

13. With the introduction of high standard, high speed, roads in Georgia, it is appropriate to promote, at the national level, the need to develop and adopt national ITS standards. Given the amount of effort, time and cost developing and testing standards in other countries, there is considerable scope to draw upon that international experience as the basis for national ITS standards. The Consultants will collaborate with RDMRDI in developing a suitable standard for Georgia. Activities will include: (i) Workshops and lectures to road user stakeholders on the need for ITS standards, implementation of basic ITS measures and examples of ITS in other countries, and (ii) collaborate with RDMRDI on designing ITS standards suitable for Georgia, which will include a phased approach to ITS implementation.

Environmental Assessment Report

The views expressed herein are those of the consultant and do not necessarily represent those of ADB’s members, Board of Directors, Management, or staff, and may be preliminary in nature.

Environmental Assessment and Review Framework Project Number: 41122 July 2009

Georgia: Subregional Road Corridors Development Program

The environmental assessment and review framework is a document of the borrower. The views expressed herein do not necessarily represent those of ADB’s Board of Directors, Management, or staff, and may be preliminary in nature.

Prepared by Engconsult Ltd., Canada for Asian Development Bank.

CURRENCY EQUIVALENTS (as of 29 June 2009)

Currency Unit – lari (GEL) GEL1.00 = $0.6047 $1.00 = GEL1.643

ABBREVIATIONS

ADB – Asian Development Bank EA – executing agency EARF – environmental assessment and review framework EE – ecological expert EEC – ecological expert conclusion EIA – environmental impact assessment EIP – environmental impact permit EMP – environmental management plan IEE – initial environmental assessment MFF – multitranche financing facility MOEPNR – Ministry of Environmental Protection and Natural Resources MORDI – NGO – nongovernment organization PMU – project management unit RAMSAR – Ramsar Convention on Wetlands RD – Roads Department SEIA – summary environmental impact assessment SIEE – summary initial environmental assessment TOR – terms of reference

NOTE

In this report, “$” refers to US dollars.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

CONTENTS

A. Introduction 1 B. Overview of the Subprojects to be Assessed 1 C. Country’s Environmental Assessment and Review Procedures 1 D. Specific Procedures to be Used for Subprojects under MFF 2 E. Compliance with ADB’s Environmental Policy—Due Diligence 7 F. Public Disclosure 7 G. Staffing Requirements and Budget 7 Annexes Annex 1 Rapid Environmental Assessment Checklist

Annex 2 Sample Scoping Document

Annex 3 Outline of an Environmental Impact Assessment Report

Annex 4 Outline of an Iniital Environmental Examination Report

Annex 5 Outline of Summary Environmental Impact Assessment Report

Annex 6 Outline of Summary Initial Environmental Examination Report

Annex 7 Outline Terms of Reference for Consulting Services for Environmental Assessment

1

Environmental Assessment and Review Framework

A. Introduction 1. This environmental assessment and review framework (EARF) has been developed to guide the Roads Department (RD) of the Ministry of Regional Development and Infrastructure (MORDI) in carrying out the environmental assessment of the future projects to be financed under the multitranche financing facility (MFF): ’Subregional Road Corridor Development Program’. The EARF is based on the Georgia’s Laws on Environmental Impact Permit and Ecological Examination (2007) and ADB’s Environment Policy (2002). B. Overview of the Subprojects to be Assessed 1. Identification of projects for MFF is under progress. So far, only one project (Project 1, Ajara Bypass Roads) has been identified and this project will be implemented in two tranches. The activities included in the Project 1 are construction of 42 km of new roads and widening of 6 km of existing roads along the Poti–-Batumi–Sarpi road, bypassing Kobuleti and Batumi (Map 1). Construction of the project road will involve new construction and rehabilitation of bridges, culverts, and other associated drainage structures; tunnel construction; land acquisition and resettlement; site preparation; land clearing; disposal of gravel, soil, vegetation, and unstable material; construction of temporary access roads to construction sites; setting up of temporary construction camps to house workers; excavation and operation of borrow pits; operation of a boulder quarry; extraction of material for embankments using cut and fill procedures; protection of landslide, rockfall, and snowfall areas; measures to protect critical side-slopes; and extraction and cartage of sand for aggregate mixtures, cement works, and asphalt plants. An environmental impact assessment has been already carried out for the Project 1. C. Country’s Environmental Assessment and Review Procedures 2. The relevant national laws on environmental assessment are the ‘Law on Environmental Impact Permit’ (dated December 14, 2007), the ‘Law on Ecological Examination’ (dated December 14, 2007) and the ‘Order No. 515 of the Minister of Environmental Protection and Natural Resources (MOEPNR) on Approval of Rules on Conduction of Ecological Examination’ (dated July 7, 2008). In accordance with these laws, all proposed subprojects require Environmental Impact Permits (EIPs) from the MOEPNR under a procedure including (i) Environmental Impact Assessment (EIA) Report, (ii) Ecological Expertise (EE), and (iii) Public participation. The steps included in securing the EIPs are:

(i) The proponent will conduct environmental assessment study and prepare an EIA

report (ii) The proponent will arrange a public hearing of EIA. The procedure involved in

public hearing is

(a) Before one week of submitting draft EIA reports to the MOEPNR and MORDI, the proponent issue advertisement in regional and national news papers about the project, and date, time and place of public consultations; and send written invitations to the local government, MOEPNR and MORDI

(b) Arrange hearing within 50 to 60 days after publishing advertisement in the news paper

2

(iii) The proponent will submit an application with EIA report. minutes of meetings of

public hearing and other required documents to the MOEPNR and MORDI for Environmental Impact Permit (EIP)

(iv) MOEPNR will carry out expert examination of the EIA report, known as State Ecological Expertise (EE) and issue positive EE Conclusion (EEC). Based on the positive EEC, the MOEPNR will issue EIP.

3. A brief summary of the relevant laws applicable for EIPs are described below:

(i) Determines the activities subject to mandatory EE and consequently to issuance

of EIP, details the procedure for the issuance of EIPs, and defines the legal basis for public participation in the process of EE conduction, EIA preparation and decision making on EIP.

(ii) Activities subject to mandatory EE and consequently to issuance of EIPs inter alia include construction of automobile roads and railroads of international or inter-state importance, bridges and road tunnels thereon, as well as engineering protection structures of automobile roads, railroads and their respective territories.

(iii) View a positive EE conclusion (EEC) as mandatory for adoption of a positive decision on the issuance of an EIP. Conduction of EE and issuance of the EEC is the responsibility of the MOEPNR, which undertakes expert examination and the normative-technical and methodological guidance documents and the procedure established under law, through a special committee of experts established for each particular case.

D. Specific Procedures to be Used for Subprojects under MFF

1. Responsibilities and Authorities 4. Responsibilities of the implementing and executing agencies (RD and MORDI) include:

(i) Prepare environmental screening checklist and classify projects in consultation

with MOEPNR and other departments. (ii) Based on the environmental classification of projects, prepare terms of reference

to conduct IEE or EIA studies. (iii) Hire an environmental consultant to prepare IEE or EIA reports including EMP

and summary EIA/IEE for public disclosure. (iv) Ensure that an IEE or EIA are prepared in compliance with the requirements of

the Government and ADB, and that adequate consultation with affected people is undertaken in accordance with ADB requirements.

(v) Undertake review of the IEE or EIA, summary EIA/IEE, and EMP reports to ensure their compliance with the requirements of the Government and ADB.

(vi) Obtain necessary permits and/or clearance, as required, from MOEPNR and other relevant government agencies, ensuring that all necessary regulatory clearances are obtained before commencing any civil work on the relevant sections.

(vii) Submit to ADB the IEE or EIA, summary EIA/IEE, and EMP reports and other documents, as necessary.

3

(viii) Ensure that any EMP including relevant mitigation measures needing to be incorporated during the construction stage by the contractor are included in the bidding documents.

(ix) Ensure that contractors have access to the EIA or IEE and EMP reports of the projects.

(x) Ensure that contractors understand their responsibilities to mitigate environmental problems associated with their construction activities.

(xi) Ensure and monitor that an EMP including an environmental monitoring plan will be properly implemented.

(xii) In case unpredicted environmental impacts occur during the project implementation stage, prepare and implement as necessary an environmental emergency program in consultation with MOEPNR, other relevant government agencies, and ADB.

(xiii) In case a project needs to be realigned during implementation, review the environmental classification, revise it accordingly, and identify whether a supplementary IEE or EIA study is required. If yes, prepare the terms of reference for undertaking a supplementary IEE or EIA and hire an environmental consultant to carry out the study.

(xiv) Submit semi-annual reports on implementing EMPs, including implementation of an environmental emergency program, if any, to MOEPNR and ADB.

(xv) Submit project completion environmental monitoring report to ADB after three years of completion of construction summarizing the overall environmental impacts from the projects.

5. ADB is responsible for the following:

(i) Review EIA and SEIA reports prepared under supervision of EA; (ii) Review of IEE and SIEE reports if it requires ADB’s no objection approval; (iii) Undertake annual environmental review missions for Category A and B sensitive

projects; and (iv) Public disclosure of SEIA and SIEE (for Category B sensitive projects) through

ADB website. 2. Environmental Criteria for Subproject Selection

6. Considering the potential environmental impacts of the future subprojects and the relevant environmental requirements of ADB and the Government of Georgia, the following criteria was agreed upon (by the Government and ADB) for selection of the future subprojects to be included in the Subregional Road Corridor Development Program:

(i) The subprojects shall only involve activities that follow all the government

regulations; (ii) The subprojects should not pass through any wildlife sanctuaries, national parks,

nature reserves, and protected areas designated by national and international regulations;

(iii) The subprojects should not pass through any ecologically sensitive and significant as recognized by the Government or any area that is internationally significant (such as protected wetland and mangroves); and

4

(iv) The subproject should as much as possible not include any stretch that passes through any cultural heritage and archaeological sites designated by UNESCO and Ministry of Culture, Monument Protection, and Sports.

3. Procedures for Environmental Assessment of Subprojects

7. ADB categorizes Road projects into two categories A and B. Projects with potential for significant adverse environmental impacts are classified into Category A. An EIA is required to address significant impacts. Project judged to have some adverse impacts, but of lesser degree and/or significance than category A is classified into Category B. An initial environmental examination (IEE) is required to determine whether or not significant environmental impacts warranting an EIA are likely. If an EIA is not needed, the IEE is regarded as the final environmental assessment report. The guidelines to prepare environmental assessment reports for a Category A project (EIA and SEIA) and for a Category B project (IEE and SIEE) in compliance with the ADB’s Environment Policy (2002) and Environmental Assessment Guidelines (2003) are given in the following sections.

a. Screening

8. All future subprojects to be included in MFF will be screened to determine its environmental category based on the ADB’s Rapid Environmental Assessment Checklist (REA). A template of the REA is given in Annex 1. Categorization is to be based on the most environmental sensitive component, which means that if one part of the project is with potential for significant adverse environmental impacts, then the project is to be classified as Category A regardless of potential environmental impacts of other aspects of the project. In general, a project will be classified as ‘Category A’ if the project:

(i) is a new road alignment; (ii) requires a complex mitigation measure needing to be prepared through an in-

depth assessment of the impacts and detailed study for preparing mitigation measures;

(iii) will generate impact on an ecologically sensitive area, particularly if the project is located less than 500 meters from any designated wildlife sanctuary, national park, other sanctuary, botanical garden, or area of international significance (e.g., an IUCN or RAMSAR site) or cultural heritage and archaeological sites designated by UNESCO. and Ministry of Culture, Monument Protection, and Sports; and

(iv) passing through any ecologically sensitive areas (hilly or mountainous, forested, nearby estuarine or other area with important ecological function). 9. Road upgrading and rehabilitation subprojects that do not fall into the above category are classified as B.

b. Scoping

10. Before conducting any environmental studies, a scoping document consists of the scope of the environmental surveys, methods of data collection and outputs anticipated from the study are to be prepared. In case of Category A projects, the scoping document is to be approved by the EA before taking up of detailed environmental studies. Scoping should focus on identifying those components of the environment likely significantly affected by the project based on project location, past documented experience, the potential likely geographic and time-related extent of the effects, and the measurements or thresholds to be used to assess significance. A map of

5

the study area with a clear topographic map showing the project road(s) in relation to topography, water courses, settlement areas and preferably landuse should be enclosed with the scoping document. A sample scoping document prepared for Project 1 of the MFF is enclosed in Annex 2.

c. Identifying Baseline Conditions and Impacts 11. With the screening and scoping results in hand, planning of the field program becomes relatively easy, however does need the involvement of an experienced environmental assessment practitioner. 12. The first step is to establish the baseline conditions for the components of the environment likely affected by the project. This will be usually carried through site visits and review of spatial database for all available environmental parameters such as terrain, soils, geology, rivers, forest, protected areas and landuse. This also will include collection and analysis of background noise, air and water quality. This baseline will become the measure against which any change is measured. These data must be collected in such a manner that their source can be traced by anyone who picks up the document. 13. The second step is to predict likely change as a result of major construction activities and operation of the road, by relating cause and effect such as changes in traffic volume, fleet makeup and traffic patterns to air quality and noise effects. This will be carried out by thorough review of baseline environment and proposed civil works. The locations where based data were collected, where ongoing monitoring takes place and the timing of these activities should be remain uniform or at least easily traceable, permitting analysis of technical credibility. While following strict scientific method in EIA is far too costly and time consuming, every effort should be made make the entire study transparent and traceable.

d. Public Consultations/Hearing 14. The third step is to present the findings on impacts and benefits during a consultation and information session to inform key stakeholders and affected community of the issues identified and to invite comments and corrections. For a Category A project consultation is required at least twice during the EIA:

(i) first as part of the scoping stage to define the project and to get feedback in

options, and (ii) secondly after the draft EMP has been prepared.

15. Public consultations include news paper advertisement in the regional and national news papers before 50 to 60 days of the consultations giving brief project description, location and specific contact data (including telephone numbers). Often a project website is created and link information is provided. Further, the proponent, working with the consultant should prepare a list of important participants and send emails or letters of invitation providing details including dates for both consultations. 16. Consultation sessions must have minutes and attendance sheets prepared and included as part of the EIA documentation.

6

17. For Category B projects, nearly all conditions as defined above are the same except there is only 1 consultation session is needed. Often, the consultation session takes place as the EMP is being prepared.

e. Preparation of the Environmental Management Plan (EMP) 18. The Fourth Step is the preparation of the EMP, the most important output of an environmental assessment. The EMP must be practical, specific and systematic, such that it can be easily converted to mitigative and monitoring actions, proponents and contractors can undertakes: activities that monitors can track and activities that can be translated or simply referenced in contract specification as environmental clauses. Therefore each mitigative measure needs to be matched with a monitoring activity. 19. Good EMPs not only identify the source of the impact, the effect in the biophysical environment and the monitoring action to be taken, but also where, how often, when and who should implement each mitigative and monitoring action and who is responsible. This is the same for both EIAs and IEEs. 20. Project Management Unit of RD is required to review and update the EMP as soon as the contractor has been appointed and the mobilization date is established.

f. Assessing Institutional Capacity for EMP Implementation 21. The Fifth Step involves the identification of the agencies and units at the national and provincial level that will likely be involved in the implementation and supervision of the mitigation and monitoring actions as well as the general management of the EMP from preconstruction through the operating period. The EMP is also useful in that it identifies the lead implementing and supervising agencies (RD, MORDI and MOEPNR and their provincial/regional departments) involved in all mitigation and monitoring actions. The analysis, using mostly the interview approach, should be short and focused, identifying needs based on obvious gaps, such as lack of experience in any international-level assessments or lack of experience with preparation and implementation of EMPs. Careful interviews will almost always result in those needing assistance identifying what they need. Finally the needs are assessed in terms of longer term capacity building and short term training and workshops in relation to realistic budgetary limits and a capacity building and training is proposed. Since the contractors play such an important role in EMP implementation, they must not be left out of the analysis and a general approach to strengthening their safeguards skills must be included in the analysis.

g. Estimating Mitigation, Monitoring and Training Costs 22. The Sixth Step involves costing of each of the mitigative and monitoring actions as well as the institutional capacity building. Costing details must be systematic and include rates and unit costs and an indication of actions that, while referred to as environmental, are normally found in other budget items, for example slope stabilization, revegetation, fuel handling and storage protocols and work camp waste management.

h. Reporting

23. The Seventh Step is preparation of the assessment document according to a prescribed format and level of details. The templates of the reports for preparation of EIA/IEE and

7

SEIA/SIEE reports are given in Annexes 3 to 6 and also can be found from ADB website at www.adb.org/documents/guidelines/environmental_assessment/default.asp. E. Compliance with ADB’s Environmental Policy—Due Diligence 24. RD, MORDI and MOEPNR have the responsibility to undertake environmental due diligence and monitor implementation of environmental mitigation measures for all projects under each respective responsibility. The due diligence report as well as monitoring of EMP implementation (described in the annual report) need to be documented systematically. ADB must be given access as needed to undertake environmental due diligence for all projects. 25. An EMP will be part of the overall project monitoring and supervision, and will be implemented by the contractor with oversight from the supervision consultant and PMU. Progress on the preparation and implementation of an EMP will be included in the periodic project progress reports. Specific monitoring activities defined in the IEEs or EIAs and EMPs will be carried out by the contractors and monitored by the PMU. RD will submit reports on EMP implementation to ADB for every six months to Category A and B sensitive projects and annually for Category B projects. 26. The PMU, with assistance of the international or national environmental consultants, will review the IEE or EIA and corresponding EMP for each project to ensure that mitigation measures and monitoring plans proposed in that document are in compliance with ADB’s and national requirements. According to the reports and reviews during its missions, ADB, in consultation with the Government, will confirm compliance. For this purpose, the PMU will provide ADB with access to information on any projects. The information on implementation of an EMP, as well as that on environmental and social safeguard compliance, will be systematically documented and reported to ADB as part of the regular progress reports. F. Public Disclosure 27. RD is responsible for ensuring that all environmental assessment documents, including the environmental due diligence and monitoring reports, are properly and systematically kept as part of the project record of each project under its responsibility. All environmental documents are subject to public disclosure. These documents should be made available to the public, if requested. In case there are category A and B-sensitive projects, the summary EIA/IEE will be disclosed to the public through ADB’s website 120 days before the project is approved. The SEIA/SIEE shall be reviewed by ADB before it is disclosed to the public. RD will also ensure that public consultations, particularly with project affected persons, are undertaken adequately during the IEE or EIA preparation in consistent with ADB requirements. G. Staffing Requirements and Budget 28. RD and MORDI will recruit environmental consultants as a part of engineering design consultants to prepare environmental assessment reports for each subproject consistent with this EARF. Terms of reference for consultants along with the budget are given in Annex 7. The estimated cost for preparation of each IEE and EIA are US$98,750 and US$156,750, respectively. Adequate funding resources will be provided under each subproject for environmental monitoring and mitigation measures for each subproject.

Annex 1

8

Rapid Environmental Assessment (REA) Checklist Instructions: This checklist is to be prepared to support the environmental classification of a project. It is to be attached to

the environmental categorization form that is to be prepared and submitted to the Chief Compliance Officer of the Regional and Sustainable Development Department.

This checklist is to be completed with the assistance of an Environment Specialist in a Regional Department. This checklist focuses on environmental issues and concerns. To ensure that social dimensions are adequately

considered, refer also to ADB checklists and handbooks on (i) involuntary resettlement, (ii) indigenous peoples planning, (iii) poverty reduction, (iv) participation, and (v) gender and development.

Answer the questions assuming the “without mitigation” case. The purpose is to identify potential impacts. Use the “remarks” section to discuss any anticipated mitigation measures.

Country/Project Title:

Sector Division:

SCREENING QUESTIONS Yes No REMARKS

A. PROJECT SITING IS THE PROJECT AREA ADJACENT TO OR WITHIN ANY OF THE FOLLOWING ENVIRONMENTALLY SENSITIVE AREAS?

CULTURAL HERITAGE SITE PROTECTED AREA WETLAND MANGROVE ESTUARINE BUFFER ZONE OF PROTECTED AREA SPECIAL AREA FOR PROTECTING

BIODIVERSITY

B. POTENTIAL ENVIRONMENTAL IMPACTS WILL THE PROJECT CAUSE…

encroachment on historical/cultural areas; disfiguration of landscape by road embankments, cuts, fills, and quarries?

encroachment on precious ecology (e.g. sensitive or protected areas)?

alteration of surface water hydrology of waterways crossed by roads, resulting in increased sediment in streams affected by increased soil erosion at construction site?

deterioration of surface water quality due to silt runoff and sanitary wastes from worker-based camps and chemicals used in construction?

increased local air pollution due to rock crushing, cutting and filling works, and chemicals from asphalt processing?

noise and vibration due to blasting and other civil works?

dislocation or involuntary resettlement of people

other social concerns relating to inconveniences in living conditions in the project areas that may trigger cases of upper respiratory problems and stress?

hazardous driving conditions where construction

ROADS AND HIGHWAYS

Annex 1

9

SCREENING QUESTIONS Yes No REMARKS interferes with pre-existing roads?

poor sanitation and solid waste disposal in construction camps and work sites, and possible transmission of communicable diseases from workers to local populations?

creation of temporary breeding habitats for mosquito vectors of disease?

dislocation and compulsory resettlement of people living in right-of-way?

accident risks associated with increased vehicular traffic, leading to accidental spills of toxic materials and loss of life?

increased noise and air pollution resulting from traffic volume?

increased risk of water pollution from oil, grease and fuel spills, and other materials from vehicles using the road?

Annex 2

10

SAMPLE SCOPING DOCUMENT

Scoping Framework for the Environmental Impact Assessment of ‘Ajara Bypass Roads Development Project’ A. Introduction 1. This scoping framework has been prepared to carryout detailed environmental impact assessment (EIA) for the ‘Ajara Bypass Roads Development Project’ in accordance with ADB’s Environment Policy (2002) and Environmental Assessment Guidelines (2003) and relevant laws and regulations in Georgia. The project involves new construction and widening of roads, bridges, overpasses, tunnels, and protection structures. The study will identify potential environmental impacts on physical, ecological, social, cultural, and economic resources of project areas during design (for different alignments), construction and operation. An EIA report will be prepared along with environmental management and monitoring plan to address all identified environmental impacts as per the work plan provided in Figure 1. The study will be carried out by Consultant and the draft EIA report will be submitted along with the Final Report of the Project. B. Scope of Work

1. Baseline Studies

a. Output 1: Memo on Georgian Legal and Administrative Procedures

2. Activity 1.1: Collection and review of relevant information regarding environmental legislation, statutory orders, by-laws, etc. connected to preparation and approval of the EIA report by Georgian Authority, and draft the memo. The memo will also consider the requirements of ADB Guidelines for ‘Category A’ Project. 3. Activity 1.2: Conduction of a series of meetings with the Ministry of Environment Protection and Natural Resources, National Environmental Agency, and the Ministry of Culture (Center of Archeological Studies, Department of Monument Protection). During these meetings appropriate legal and administrative procedures has been discussed. Discussions also includes issues such as basis for further approval/ disapproval of EIA by Georgian authorities and on the issuance of “Construction Permit” along with “Environmental Impact Permit’ (published in 2007 and entered in force in 2008) and ‘State Ecological Examination’ in accordance with Georgia’s Law on Licenses and Permits (2005). Review of other relevant environmental laws, regulations, Norms, and Standards on Air, Noise, Water, Waste, and Wildlife. 4. Activity 1.3: Conduction of discussion meeting with the Road Department of the Ministry of Regional Development and Infrastructure on the issuance of “construction permit” and “environmental impact permit” in accordance with Georgia’s Law on Licenses and Permits (2005).

b. Output 2: Preparation of Baseline Assessment 5. Activity 2.1: Review of reports and field data collected from the Project’s pre-feasibility study; and other road projects carried out under the World Bank, JBIC, EBRD, and MCC’s funding.

Annex 2

11

6. Activity 2.2: Collection of baseline information on existing environmental condition along the project road alignments and identification of the environmental components that need detailed further study. Baseline assessment will be done based on the available secondary information, field visits, sampling and environmental monitoring including but not limited to the following:

(i) Physical resources: Topography, climate, soils, geology, landuse, coastal

resources, and surface and groundwater resources; (ii) Natural hazards: Seismicity, floods, landslides, and volcanic activity; (iii) Ecological Resources: Landscape and natural ecosystem, flora and fauna,

wildlife and wetland habitats, nature reserve and Protected areas; (iv) Environmental quality: Air quality (PM, CO, NOx, SOx etc.), noise quality and

water quality (DO, TPH, pH, total nitrogen, BOD, total phosphorus, and suspended solid etc.); and

(v) Cultural resources and Archaeological sites: Structures or sites that are of historical, archaeological, paleontological, or architectural significance.

2. Detailed Field Investigation to Screen Environmental Impacts

c. Output 3: Field Investigation and Analysis of Results 7. Activity 3.1: Preparation of layout plan of the project road consisting of, but not limited to, the flowing information:

(i) Road alignments (ii) Sampling location for environmental parameters (air, noise, water) (iii) Construction camp including storage of petroleum products and explosives (iv) Asphalt and batch mixing plants, Construction sites and camps, Quarry sites and

borrow pits (v) Water sources, Waste disposal sites, Environmentally sensitive areas

8. Activity 3.2: Collection of a cadastral land use map showing the project locations and descriptions of the surrounding activities. This is to ensure that the project road is compatible with the national regulation specified for construction sites. 9. Activity 3.3: Initiation of necessary investigations and fieldwork for gathering of following additional information about ecological and environmental parameters in the project area.

(i) Landscape, Geohazards and Slope Stability. Identification of natural

landscape along the project road. Assessment of geological and geomorphologic features of the project area, as well as any violent interference in the natural processes. Investigation and evaluation of results to predict rock falls, landslide, mudflow and debris flow, erosion, ground subsidence, floods, and banks washing-off (lateral erosion) and seashore erosion.

(ii) Soil Erosion and Slope Stability. Analysis of soil characteristics, moisture contents, vegetation cover etc., in conjunction with the above activity, to predict possible soil erosion and landslides due to project activities.

(iii) Terrestrial Flora and Fauna. Investigation of the composition of plant species and migratory birds in the Project area. Attention should be paid to the distribution of protected plant and animal/birds species in order to ensure favorable conservation status for these species.

Annex 2

12

(iv) Wetland habitats and Aquatic Flora and Fauna. Investigations of occurrence of species (flora and fauna) in the identified wetlands along the project area and assess the potential influence of the proposed road alignment. Attention should be paid to the distribution of protected species in order to ensure favorable conservation status for these species.

(v) Protected Areas and Sensitive Environmental Receptors. Collection of protected and sensitive area maps and exact coordinates showing the boundaries and buffer zones of protected areas and project alignments and descriptions of the habitats. This is to ensure that the locations of sensitive areas and project alignment are sufficiently distant enough to maintain harmonization and avoid any potential disturbances on the habitats. Investigation will also be done for other sensitive sites along the project alignment, viz. wetlands, seashore, tourism, etc.

(vi) Traffic Flow. Traffic counts and historical traffic flow to predict the future traffic growth and the load on the project road.

(vii) Air Quality and Noise Level. Collection and analysis of air (PM, CO, NOx, SO2) and noise quality along the project road.

(viii Water Quality. Collection and analysis of water quality (DO, turbidity, pH, TOC, and dissolved solid) of the major rivers along the project road. Investigation of water quality impacts during construction and operations stages in selected river sites.

(ix) Monuments and Archaeological Site. Investigation of the impact of the project on monuments and archaeological sites along the project corridor.

(x) Quarry and Borrow Sites. Estimation of effects on the ecological resources in the area connected to quarry and barrow pit operations needed for construction.

3. Analysis of Alternatives and Economic Assessment

d. Output 4: Analysis of Alternative Options 10. Activity 4.1: Comparative environmental analysis of all available project alignments, including “No Project” scenario.

e. Output 5: Economic Assessment 11. Activity 5.1: Economic analysis of all alternatives in accordance with ADB’s Handbook on Economic Evaluation of Environmental Impacts for: (i) costs and benefits of environmental impacts; (ii) costs, benefits, and cost-effectiveness of mitigation measures; and (iii) discussion of impacts that have not been expressed in monetary values, in quantitative terms where possible. 4. Forecast Future Impacts and Mitigation Measures

f. Output 6: Forecast of Impacts 12. Activity 6.1: Forecasting of air and noise quality based on predicted traffic estimates using computer modeling software and recommendation of mitigation measures. 13. Activity 6.2: Evaluation of the project impact on all physical and ecological resources described in Activity 3.3 and recommendation of mitigation measures. 14. Activity 6.3: Evaluation of socio-economical and cultural impacts, such as:

Annex 2

13

(i) Assessment of the status of livelihoods (agriculture, business, etc.) in the context of socio-economical impact.

(ii) Assessment of the impact on objects or areas with known archeological values in the project area.

(iii) Assessment of impacts on culturally and religiously sensitive locations (church, cemetery, etc.)

(iv) Assessment of impacts in tourism sector in Kobuleti and Batumi resort areas (v) Assessment of traffic safety.

15. Activity 6.4: Assessment of impact on human health and estimation of possible health impacts on construction workers and roadside residents (such as safety, HIV/AIDS, STDs, human trafficking) due to construction camps and other project activities.

g. Output 7: Environmental Management and Monitoring Plan

16. Activity 7.1: Preparation of Environmental Management and Monitoring Plan (EMMP) for all phases of the Project for effective implementation of environmental protection and mitigation measures and monitoring of significant environmental impacts. Preparation of environmental protection measures to (i) mitigate environmental impacts, (ii) provide in-kind compensation for lost environmental resources, or (iii) enhance environmental resources. Prepare cost estimates for each mitigation measure proposed in the EMP and include all the mitigation measures in the engineering design of the Project. 17. Activity 7.2: Setting up of environmental criteria for several variables such as:

(i) Air quality, Noise level, Water quality, Accidental spills of hazardous substances; and

(ii) Naturally protected areas. 5. Institutional Assessment and Monitoring Mechanism

h. Output 8: Institutional Assessment

18. Activity 8.1: Assessment of institutional capacity of the implementing agencies for effective implementation of environmental management and monitoring plan. Identification of responsible institutes for implementation and supervision of the EMMP. Assess training needs of these agencies and propose capacity building measures and institutional arrangements to strengthen these agencies along with the cost estimates.

i. Output 9: Monitoring Mechanism

19. Activity 9.1: Elaboration and specifying of “feed back monitoring” program, a tool to be used by implementing authorities in order to be able to interfere and respond quickly to activities, which during the construction and operation turn out to have a negative effect to the environment. The tool will specify the parameters, location, frequency and means of monitoring. 6. Public Consultations and Disclosure Plan

j. Output 10: Conduct Public Consultations and Document them

Annex 2

14

20. Activity 10.1: Assisting Department of Road to conduct two public consultations (one during the inception stage and the second one after finalization of EIA report) according to ADB’s Public Communications Policy (2005) for Category A projects and the 6th Clause of the Law of Georgia on the Environmental Impact Permit. This will ensure that the consultation process will involve affected people, key agencies, NGOs, and other stakeholders and they are provided with opportunities to participate in the decision-making process and to influence decisions that will affect them. Address all the comments in the engineering designs. 21. Activity 10.2: Agreement by the appropriate authorities of specific zones where minor temporary and/or permanent impacts to the environment can be accepted during the construction and operation phase of the bypass road. The ranges of the zones will be determined on the basis of results of investigations and local conditions.

k. Output 11: Disclosure Plan

22. Activity 11.1: In consultation with the stakeholders, preparation of information disclosure plan for dissemination of safeguard documents to the affected community and general public.

Figure 1: Work Plan of Proposed EIA Study

Annex 3

15

Outline of an Environmental Impact Assessment (EIA) Report

A. Introduction 1. This section usually includes the following:

(i) purpose of the report, including (a) identification of the project and its proponent,

(b) brief description of the nature, size, and location of the project and its importance to the country, and (c) any other pertinent background information;

(ii) stage of project preparation (i.e., pre-feasibility study, feasibility study, detailed engineering design preparation);

(iii) extent of the EIA study, including the scope of the study, magnitude of effort, and persons/expertise or agency performing the study and corresponding person months; and

(iv) brief outline of the contents of the report, including any special techniques or methods used for identifying issues, assessing impacts, and designing environmental protection measures.

B. Description of the Project 2. The project should be described in terms of its basic activities, location, layout, and schedule (in terms of the project cycle). This section of the EIA report should provide sufficient details on the following:

(i) Type of project; (ii) Need for project; (iii) Location (use maps showing general location, specific location, project boundary

and project site layout); (iv) Size or magnitude of operation including any associated activities required by or

for the project; (v) Proposed schedule for approval and implementation; and (vi) Description of the project including drawings showing project layout, components

of project, etc. This information should be of the same type and extent as is included in feasibility reports for proposed projects, in order to give a clear picture of the project and its operations.

C. Description of the Environment 3. This section contains a description of the study area to provide a clear picture of the existing environmental resources and values within which the impacts must be considered. Detailed methodology to gather information, including data sources, should also be briefly described. As much as possible, the baseline information should be presented in maps, figures, and tables. The baseline environmental information area should include:

(i) Physical Resources: e.g.

(a) atmosphere (e.g. air quality and climate) (b) topography and soils, (c) surface water (d) groundwater (e) geology/seismology.

Annex 3

16

(ii) Ecological Resources: (e.g.) (a) fisheries (b) aquatic biology (c) wildlife (d) forests (e) rare or endangered species (f) protected areas (g) coastal resources

(iii) Economic Development: (e.g.)

(a) industries (b) infrastructure facilities (e.g. water supply, sewerage, flood control) (c) transportation (roads, harbors, airports, and navigation) (d) land use (e.g. dedicated area uses) (e) power sources and transmission (f) agricultural development, mineral development, and tourism facilities

(iv) Social and Cultural Resources: (e.g.)

(a) population and communities (e.g. numbers, locations, composition, employment);

(b) health facilities; (c) education facilities; (d) socio-economic conditions (e.g. community structure, family structure,

social well being); (e) physical or cultural heritage; (f) current use of lands and resources for traditional purposes by Indigenous

Peoples; and (g) structures or sites that are of historical, archaeological, paleontological, or

architectural significance. D. Alternatives 4. The consideration of alternatives is one of the more proactive sides of environmental assessment - enhancing the project design through examining options instead of only focussing on the more defensive task of reducing adverse impacts of a single design. This calls for the systematic comparison of feasible alternatives for the proposed project site, technology, and operational alternatives. Alternatives should be compared in terms of their potential environmental impacts, capital and recurrent costs, suitability under local conditions, and institutional, training and monitoring requirements. For each alternative, the environmental costs and benefits should be quantified to the extent possible, economic values should be attached where feasible, and the basis for the selected alternative should be stated. 5. Examining alternative means of carrying out a project involves answering the following three questions: (i) what are the alternatives? , (ii) what are the environmental impacts associated with each alternative? , and (iii) what is the rationale for selecting the preferred alternative? For example, a road connecting two points can follow a number of different routes. In this case, the EIA report must describe the process taken to select the most appropriate route based on a set of pre-determined criteria. The consideration of alternatives and the selection criteria used to identify the preferred alternatives must include environmental factors. The information going into the decision and the decision-making process must be documented in the

Annex 3

17

EIA report. For example, if "alternative means" refers to site selection for a large hydroelectric dam, the location of each alternative would have to be described, the environmental impacts of each alternative defined and the criteria and analysis of site selection presented. 6. Since the selection of alternatives can involve detailed technical analysis that includes more than just environmental factors, it may be preferable to present the details of this analysis as an appendix and include only the results and summary of this selection process in the body of the report. For example, a table listing the alternatives on one axis, and the criteria, such as reliability, cost, performance, inherent environmental effects and necessary mitigation measures, on the other axis may provide an effective summary. 7. Alternatives to the Project. In some instances it will be necessary to consider “alternatives to” the project. This situation should not arise if the project is consistent with DMC’s development strategy, ADB’s Country and Strategy Program, and has been developed based on a sector strategy and roadmap. The EIA report should describe how the project fits into this larger strategic planning context. This context helps justify the project and demonstrates the requirements that may constrain the alternatives that are feasible or permitted. 8. However, in the case of potentially controversial projects, there may public concern that the project does not represent the best way to achieve stated development objectives. In addition, segments of the public may react negatively if they perceive that the EIA report has not considered alternatives to the project, or the preferred alternative is proceeding based on flawed assumptions. Therefore, if controversy is expected surrounding the fundamental reasons for the project, the EIA report should include a discussion of alternatives to the project. 9. One alternative that should receive special attention is the "no go" alternative. In some cases, this may be the only alternative to the project that can be realistically considered. E. Anticipated Environmental Impacts and Mitigation Measures 10. Review Characteristics of each Environmental Impact. This section will evaluate the project’s expected impacts (in as quantified terms as possible) on each resource or value, and applicable sectoral environmental guidelines wherever any significant impact is expected (including environmental risk assessment, where appropriate. Environmental impacts to be investigated will include those due to (i) project location; (ii) caused by possible accidents; (iii) related to design; and (iv) during construction, regular operations, and final decommissioning or rehabilitation of a completed project. Where adverse effects are indicated, discuss measures for minimizing and/or offsetting these, and opportunities for enhancing natural environmental values will be explored. Both direct and indirect effects will be considered, and the region of influence indicated. This analysis is the key presentation in the report and if not sufficiently completed it may be necessary to delay the project until the analysis can be completed. It is necessary to present a reasonably complete picture of both the human use and quality of life gains to result from the project due to the utilization, alteration, and impairment of the natural resources affected by the project, so that fair evaluation of the net worth of the project could be made. 11. Mitigating Adverse Effects. For each significant adverse environmental impact, the report will carefully explain how the project plan/design minimizes the adverse effects and in addition how the project plan/design, to the extent feasible, includes provision for offsetting or compensating of adverse effects and for positive enhancement of benefits or environmental quality. Where substantial cost of mitigation measures is involved, alternative measures and costs will be explored.

Annex 3

18

12. Irreversible and Irretrievable Impacts. The EIA report will identify the extent to which the proposed project would irreversibly curtail the potential uses of the environment. For example, highways that cut through stream corridors, wetlands, or a natural estuary can result in irretrievable damage to those sensitive ecosystems. Other impacts that may be irreversible include alteration of historic sites, and expenditure of construction materials and fuels. Also, projects through estuaries, marshes, etc., may permanently impair the area’s natural ecology; or elimination of recreation areas and parklands can precipitate drastic changes in the project area’s social and economic character. 13. Temporary Effects during Project Construction. In the event the construction phase of the project involves special environmental impacts (to be terminated on completion of construction), these will be separately discussed including proposed remedial measures. F. Economic Assessment 14. This section may be drawn from the economic analysis conducted as part of the project feasibility study. It should include the following elements which should be integrated into the overall economic analysis of the project: (i) costs and benefits of environmental impacts; (ii) costs, benefits, and cost-effectiveness of mitigation measures; and (iii) discussion of impacts that have not been expressed in monetary values, in quantitative terms where possible (e.g. weight of volume estimates of pollutants). G. Environmental Management Plan 15. The EMP describes how the mitigation and other measures to enhance the benefits of environmental protection will be implemented. It explains how the measures will be managed, who will implement them, and when and where they will be implemented. The following elements should be described in the EMP (see Table A2.1 for contents of EMP): (i) implementation of mitigation measures during project design; (ii) implementation of mitigation measures by contractors, and how impacts prevention will be incorporated in the materials procurement; (iii) social development program (e.g., resettlement plan, community training); (iv) contingency response plan for natural or other disasters, and project contingencies; and (v) environmental management and monitoring costs including mitigation costs. 16. The environmental monitoring plan describes the monitoring activities to ensure that adverse environmental impacts will be minimized, and the EMP implemented. The environmental monitoring plan will cover selected parameters to indicate the level of environmental impacts. It also describes how, when, and where the monitoring activities will be undertaken; who will carry them out; and who should receive the monitoring report. More importantly, it includes a proposal to carry out environmental compliance monitoring activities. 17. The present capacity of the executing agency to implement EMP should be described and implementation costs clearly identified. H. Public Consultation and Information Disclosure 18. This section will (i) describe the process undertaken to involve the public in project design and recommended measures for continuing public participation; (ii) summarize major comments received from beneficiaries, local officials, community leaders, NGOs, and others, and describe how these comments were addressed; (iii) list milestones in public involvement (e.g., dates, attendance, topics of public meetings), and recipients of the report and other

Annex 3

19

project-related documents; (iv) describe compliance with relevant regulatory requirements for public participation; (v) if possible summarize public acceptance or opinion on the proposed project; and (vi) describe other related materials or activities (e.g., press releases, notifications) as part of the effort to gain public participation. This section will provide of summary of information disclosed to date and procedures for future disclosure. I. Conclusions 19. The EIA report will present the conclusions of the study including: (i) gains which justify project implementation; (ii) explanation of how adverse effects could be minimized or offset, and compensated to make these impacts acceptable; (iii) explanation of use of any irreplaceable resources; and (iv) provisions for follow-up surveillance and monitoring. Simple visual presentations of the type and magnitude of the impacts may aid the decision-maker.

Annex 4

20

Outline of Summary Environmental Impact Assessment (SEIA) Report A. Introduction (1/2 page) 1. This section will include the purpose of the report, extent of the EIA study and brief description of any special techniques or methods used. B. Description of the Project (1/2 page) 2. This section will include the type of and need for project, location, size or magnitude of operation and proposed schedule for implementation. C. Description of the Environment (2-3 pages) 3. This section will include the physical and ecological resources, human and economic development and quality of life values in the area affected by the project. Where available, environmental standards will be used as the baseline for comparative purposes. D. Alternatives (1-2 pages) 4. For each alternative, a summary of the probable adverse impacts and its relation to the project, and other alternatives will be discussed determine whether the project minimizes the environmental impact over all other alternatives and is within acceptable environmental impact limits. In most cases, environmental impacts "with" and "without" project alternatives should be examined. E. Anticipated Environmental Impacts and Mitigation Measures (4-6 pages) 5. Environmental impacts, both direct and indirect, on different environmental resources or values due to project location, as related to design, during construction and regular operation will be discussed and mitigation, offsetting or enhancement measures will be recommended. F. Economic Assessment (1-2 pages) 6. This section will include: (a) costs and benefits of environmental impacts; (b) costs, benefits and cost effectiveness of mitigation measures; and (c) for environmental impacts that have not been expressed in monetary values, a discussion of such impacts, if possible, in quantitative terms (e.g. weight or volume estimates of pollutants). This information should be integrated into the overall economic analysis of the project. G. Environmental Management Plan (1-2 pages) 7. The EMP will describe the impacts to be mitigated, and activities to implement the mitigation measures, including how, when, and where they will be implemented. The environmental monitoring plan will describe the impacts to be monitored, and when and where monitoring activities will be carried out, and who will carry them out. H. Public Consultation and Disclosure (1-3 pages) 8. This section will describe the process undertaken to involve the public in project design and recommended measures for continuing public participation; summarize major comments

Annex 4

21

received from beneficiaries, local officials, community leaders, NGOs, and others, and describe how these comments were addressed; list milestones in public involvement such as dates, attendance, and topics of public meetings; list recipients of this document and other project related documents; describe compliance with relevant regulatory requirements for public participation; and summarize other related materials or activities, such as press releases and notifications. This section will provide of summary of information disclosed to date and procedures for future disclosure. I. Conclusions (1 page) 9. This section will describe the gains which justify implementation of the project; explain how significant adverse environmental impacts will be mitigated or offset and compensated for; explain/justify use of any irreplaceable resources and; describe follow-up surveillance and monitoring.

Annex 5

22

Outline of an Initial Environmental Examination (IEE) Report

A. Introduction 1. This section usually includes the following:

(i) purpose of the report, including (a) identification of the project and project

proponent; (b) brief description of the nature, size, and location of the project and of its importance to the country; and (c) any other pertinent background information; and

(ii) Extent of the IEE study: scope of study, magnitude of effort, person or agency performing the study, and acknowledgement.

B. Description of the Project 2. Furnish sufficient details to give a brief but clear picture of the following (include only applicable items):

(i) type of project; (ii) category of Project; (iii) need for project; (iv) location (use maps showing general location, specific location, and project site); (v) size or magnitude of operation; (vi) proposed schedule for implementation; and (vii) description of the project, including drawings showing project layout, and project

components.

3. This information should be of the same type and extent as is included in feasibility reports for proposed projects to give a clear picture of the project and its operations. C. Description of the Environment 4. Furnish sufficient information to give a brief but clear picture of the existing environmental resources in the area affected by the project, including the following (to the extent applicable):

(i) Physical Resources: (e.g.)

(a) atmosphere (e.g. air quality and climate) (b) topography and soils, (c) surface water (d) groundwater (e) geology/seismology.

(ii) Ecological Resources: (e.g.)

(a) fisheries (b) aquatic biology (c) wildlife (d) forests (e) rare or endangered species

Annex 5

23

(f) protected areas (g) coastal resources

(iii) Economic Development: (e.g.)

(a) industries (b) infrastructure facilities (e.g. water supply, sewerage, flood control) (c) transportation (roads, harbors, airports, and navigation) (d) land use (e.g. dedicated area uses) (e) power sources and transmission (f) agricultural development, mineral development, and tourism facilities

(iv) Social and Cultural Resources: (e.g.)

(a) population and communities (e.g. numbers, locations, composition,

employment) (b) health facilities (c) education facilities (d) socio-economic conditions (e.g. community structure, family structure,

social well being) (e) physical or cultural heritage (f) current use of lands and resources for traditional purposes by Indigenous

Peoples (g) structures or sites that are of historical, archaeological, paleontological, or

architectural significance.

D. Screening of Potential Environmental Impacts and Mitigation Measures 5. Using the checklist of environmental parameters for different sector projects, this section will screen out “no significant impacts” from those with significant adverse impact by reviewing each relevant parameter according to the following factors or operational stages. Mitigation measures, where appropriate, will also be recommended environmental problems due to project location, and related to project design, construction, and operations. Potential environmental enhancement measures and additional considerations will also be covered. E. Institutional Requirements and Environmental Monitoring Plan 6. This section should state the impacts to be mitigated, and activities to implement the mitigation measures, including how, when, and where they will be implemented. Institutional arrangements for implementation should be described. The environmental monitoring plan will describe the impacts to be monitored, and when and where monitoring activities will be carried out, and who will carry them out. The environmental management and monitoring costs should also be described. F. Public Consultation and Information Disclosure 7. This section will describe the process undertaken to involve the public in project design and recommended measures for continuing public participation; summarize major comments received from beneficiaries, local officials, community leaders, NGOs, and others, and describe how these comments were addressed; list milestones in public involvement such as dates, attendance, and topics of public meetings; list recipients of this document and other project

Annex 5

24

related documents; describe compliance with relevant regulatory requirements for public participation; and summarize other related materials or activities, such as press releases and notifications. This section will provide of summary of information disclosed to date and procedures for future disclosure. G. Findings and Recommendations 8. This section will include an evaluation of the screening process and recommendation will be provided whether significant environmental impacts exist needing further detailed study or EIA. If there is no need for further study, the IEE itself, which at times may need to be supplemented by a special study in view of limited but significant impacts, becomes the completed environmental assessment for the project and no follow-up EIA will be needed. If an EIA is needed, then this section will include a brief terms of reference (TOR) for the needed follow-up EIA, including approximate descriptions of work tasks, professional skills required, time required, and estimated costs. The Bank's Environment Guidelines provides a guide for preparing the TOR for different projects. H. Conclusions 9. This section will discuss the result of the IEE and justification, if any, of the need for additional study or EIA. If an IEE, or an IEE supplemented by a special study, is sufficient for the project, then the IEE with the recommended institutional and monitoring program becomes the completed EIA.

Annex 6

25

Outline of Summary Initial Environmental Examination (SIEE) Report A. Introduction (1/2 page) 1. This section will include the purpose of the report, extent of the IEE study and brief description of any special techniques or methods used. B. Description of the Project (1/2 page) 2. This section will include the type of and need for the project; and project location, size or magnitude, operation, and proposed schedule for implementation. C. Description of the Environment (2 pages) 3. This section will include the physical and ecological resources, human and economic development, and quality of life values. D. Forecasting Environmental Impacts and Mitigation Measures (2-4 pages) 1. This section will identify "no significant impacts" from those with significant adverse impacts and will discuss the appropriate mitigation measures, where necessary. E. Institutional Requirements and Environmental Monitoring Plan (1 page) 5. This section will describe the impacts to be mitigated, and activities to implement the mitigation measures, including how, when, and where they will be implemented. The environmental monitoring plan will describe the impacts to be monitored, and when and where monitoring activities will be carried out, and who will carry them out. F. Public Consultation and Disclosure 6. This section will describe the process undertaken to involve the public in project design and recommended measures for continuing public participation; summarize major comments received from beneficiaries, local officials, community leaders, NGOs, and others, and describe how these comments were addressed; list milestones in public involvement such as dates, attendance, and topics of public meetings; list recipients of this document and other project related documents; describe compliance with relevant regulatory requirements for public participation; and summarize other related materials or activities, such as press releases and notifications. This section will provide of summary of information disclosed to date and procedures for future disclosure. G. Findings and Recommendations (1-2 pages) 7. This section will include an evaluation of the screening process, and recommendation will be provided whether significant environmental impacts exist needing further detailed study or EIA. If there is no need for further study, the IEE itself, which at times may need to be supplemented by a special study in view of some small significant impacts, becomes the completed EIA for the project and no follow-up EIA will be needed. If further additional study is needed, then this section will include a brief terms of reference (TOR) for the needed follow-up EIA, including approximate descriptions of work tasks, professional skills required, time

Annex 6

26

required, and estimated costs. The Bank's Environment Guidelines provides a guide for preparing the TOR for different projects. H. Conclusions (1/2 page) 8. This section will discuss the result of the IEE and justification if any of the need for additional study or EIA. If an IEE or an IEE supplemented by a special study is sufficient for the project, then the IEE with the recommended institutional requirements and monitoring program become the completed EIA.

Annex 7

27

Outline Terms of Reference for Consulting Services for Environmental Assessment A. Objectives 1. The objective of the services are (a) to conduct environmental impact assessment (EIA)/ initial environmental examination (IEE) of the proposed subproject to identify potential environmental impacts on physical, environmental, ecological, social, cultural and economic resources, and (b) to prepare EIA/IEE report along with environmental management plan. The duration of an EIA study is 5 months and an IEE study is 3 months. B. Scope of Work 2. The consultant’s scope of work will include the following tasks:

(i) reviewing prevailing government regulations and donor guidelines governing the assessment and management of environmental impacts of road projects;

(ii) prepare a scoping document for the environmental studies to be carried out under the project;

(iii) undertake the EIA/IEE study to assess the direct and in-direct environmental impacts of the Project such as: (a) ecological impacts (plants and wildlife); (b) soil erosion and desertification; (c) protection of wetland habitat; (d) impact of quarry sites; (e) impact of construction camps on local environment (natural and social); (f) operational traffic safety measures; (g) areas with known archeological value; and (h) potential spills of hazardous or toxic chemicals and an appropriate response plan for the Project;

(iv) prepare the EIA/IEE report and its summary in accordance with ADB’s Environmental Policy (2002) and related Environmental Assessment Guidelines (2003) as well as ADB's Public Communications Policy (2005);

(v) the EIA/IEE study should address all potential direct and indirect environmental impacts of the project. The assessment of environmental impact should be presented in the order of project cycle: pre-construction, construction and operation. This EIA/IEE report should include the detailed environmental management plan that should be included in the bidding document; Analyze the likely impacts during construction and operation and suggest appropriate mitigation measures;

(vi) conduct formal public consultations with affected people (two consultations for EIA and one consultation for IEE). The first consultation aims to gather environmental concerns from affected people and the final consultation aim to share the result of the assessment and the proposed mitigation measures. The list of people attended the consultation, time and locations; subject discussed during consultation should be recorded in systematic manner and should be attached in the EIA/IEE report as an appendix;

(vii) solicit and incorporate comments on the draft EIA and summary EIA reports from ADB, MPW, NGOs, civil society, and other stakeholders. Finalize the report to accommodate inputs from all the stakeholders; and

(viii) submit the reports to MOEPNR and make presentation as required by MOEPNR to obtain a environmental impact permit.

Annex 7

28

C. Organization and Staffing 3. The services are expected to be provided a team comprising one international and one national consultant. 4. The International Environmental Specialist shall have at least 15 years experience and familiarity with all aspects of environmental management and with significant experience in environmental management and monitoring of projects, environmental assessment and / or implementation of environmental mitigation measures on construction projects. The specialist shall also have experience working in teams of multi-discipline experts and leading a national team of consultants. Candidates with higher degrees in environmental engineering or environmental science or environment management are preferred. 5. The National Specialists shall at least be graduates in environmental science, environmental engineering, geological science, engineering hydrology, biology or related discipline with significant experience in environmental management and monitoring of projects, environmental assessment and/or design and implementation of environmental mitigation measures. D. Budget 6. The estimated cost for preparation of each IEE and EIA are provided in Table 1 and Table 2, respectively. A team of International and national specialists are recommended for these studies. Generally for government funded projects, the environmental assessment team would include an environmental specialist, a geologist, and a biologist.

Table 1: Estimated Cost of IEE Preparation for each Subproject

Item Unit Quantity Unit Cost

USD Total International Environmental Specialist Person-month 3 25,000 75,000 National Environmental Specialist Person-month 3 3,500 10,500 Land Transportation Months 3 1,250 3,750 Data collection, sample analysis Lumpsum 1 4,000 4,000 Communication Months 3 500 1,500 Report production and distribution Lumpsum 1 2,000 2,000 Public Consultation Lumpsum 1 2,000 2,000 Total 98,750

Table 2: Estimated Cost of EIA Preparation for each Subproject

Item Unit Quantity Unit Cost USD Total International Environmental Specialist Person-month 4 25,000 100,000 National Environmental Specialist Person-month 4 3,500 14,000 National Hydrologist Person-month 2 3,500 7,000 National Geologist Person-month 2 3,500 7,000 National Biologist Person-month 2 3,500 7,000 Land Transportation Months 5 1,250 6,250 Communication Months 5 500 2,500 Data collection and sample analysis Lumpsum 1 7,000 7,000 Report production and distribution Lumpsum 1 2,000 2,000 Public Consultation Lumpsum 2 2,000 4,000 Total 156,750

Annex 7

29

E. Supervision 7. The team will work in association with the PMU/RD, reporting to the project director of the PMU/RD on a day-to-day basis. F. Outputs 8. The team’s outputs will include: (i) an inception report reviewing the available environmental reports and prepare preliminary assessment of impacts associated with the proposed project, (ii) an interim report; (iii) a draft final report, containing a description of project environment, anticipated environmental impacts for various alternatives and proposed environmental management, monitoring and mitigation plan, and (iv) final report incorporating comments from ADB and other stakeholders.

Resettlement Planning Document

The views expressed herein are those of the consultant and do not necessarily represent those of ADB’s members, Board of Directors, Management, or staff, and may be preliminary in nature.

Land Acquisition and Resettlement Framework Project Number: 41122 July 2009

Georgia: Subregional Road Corridors Development Program

The land acquisition and resettlement framework is a document of the borrower. The views expressed herein do not necessarily represent those of ADB’s Board of Directors, Management, or staff, and may be preliminary in nature.

Prepared by Roads Department (RDMRDI) Ministry of Regional Development and Infrastructure of Georgia.

CURRENCY EQUIVALENTS (as of 29 June 2009)

Currency Unit – lari (GEL) GEL1.00 = $0.6047 $1.00 = GEL1.643

ABBREVIATIONS

ADB – Asian Development Bank AF – affected family AH – affected household AP – affected people CBO – community-based organization DMS – detailed measurement survey DRD – Development and Resettlement Division EA – executing agency GRC – grievance redress committee IMA – Independent Monitoring Agency IP – indigenous people IPSA – initial poverty and social assessment LAR – land acquisition and resettlement LARF – land acquisition and resettlement framework LARP – land acquisition and resettlement plan LRAG – Land Registration Agency of Georgia MFF – multitranche financing facility NAPR – National Agency of Public Registry NGO – nongovernment organization PPTA – project preparatory technical assistance PSA – Poverty and Social Assessment RDMRDI – Roads Department of the Ministery of Regional and Infrastructure

Development of Georgia

NOTE

In this report, “$” refers to US dollars.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

CONTENTS

A. INTRODUCTION 1 B. LAR-RELATED PROGRAM PROCESSING REQUIREMENTS 1 C. INDIGENOUS PEOPLES AND VULNERABLE GROUPS 2 D. LARP PREPARATION AND IMPLEMENTATION 2 E. LEGAL AND POLICY BACKGROUND 3 F. COMPENSATION ELIGIBILITY AND ENTITLEMENT FOR THE PROJECT 6 G. GENDER IMPACTS AND MITIGATION MEASURES 9 H. PUBLIC PARTICIPATION AND DOCUMENTS DISCLOSURE 10 I. INSTITUTIONAL ARRANGEMENTS 10 J. COMPLAINTS AND GRIEVANCES 12 K. MONITORING AND EVALUATION 13 L. CAPACITY BUILDING AND TRAINING IN LAR IMPLEMENTATION 14 M. RESETTLEMENT BUDGET AND FINANCING 15 N. LARP IMPLEMENTATION PROCESS 15

Annexes: Annex A: Synopsis of Selected Georgia Laws and Regulations on LAR 17 Annex B: Summary of ADB’s Policy on Involuntary Resettlement 22 Annex C: Outline of a Standard LARP 24

1

LAND ACQUISITION AND RESETTLEMENT FRAMEWORK A. INTRODUCTION 1. This Land Acquisition and Resettlement Framework (LARF) for the Southern Corridor Roads Development Program (the Program) has been prepared by The Road Department of the Ministry of Regional Development and Infrastructure of Georgia (RDMRDI) and is fully endorsed by the RDMRDI. The Project, to be financed by ADB under the Multi Tranche Financial Facility (MFF) will be implemented over a period of 5 years and will cover three tranches with various projects in each tranche. The Program will be implemented by RDMRDI and will finance the civil works for construction of various roads. 2. The objective of this document is to provide guidance in the preparation/implementation of Land Acquisition and Resettlement (LAR) tasks for the projects under each tranche and to establish the necessary covenants to ensure that this is done in compliance to ADB’s Policy on Involuntary Resettlement and procedures for the MFF. This LARF sets out the procedures for the preparation of Land Acquisition and Resettlement (LAR) tasks for projects under the Program and sets the objectives, principles, compensation eligibility/entitlement criteria, legal/institutional frameworks, participation/consultation procedures and grievance redress mechanisms to be employed to compensate, resettle and rehabilitate the living standards of Affected Families (AF) and People (APs.) This LARF also sets out the steps for preparing LAR Plans (LARP) in case they are needed. 3. Before Program appraisal this LARF will be translated into Georgian and distributed to all interested stakeholders. The English version will be posted on the ADB website. B. LAR-RELATED PROGRAM PROCESSING REQUIREMENTS

4. Based on ADB policy/practice appraisal of the MFF and each tranche and approval of the implementation of tranche subprojects will require the preparation of the following:

(i) A LARF for the whole financial facility and applicable to all subprojects. The LARF will be reviewed, if necessary updated, and submitted for ADB approval at least annually and always at the start of the preparation of each tranche.

(ii) An Initial Poverty and Social Assessment (IPSA) indicating, for each tranche, whether LAR impacts are likely to occur, type of impacts, likely magnitude, and whether there may be Indigenous Peoples (IP) affected, and;

(iii) If LAR occurs, a LAR Plan (LARP) for each project under a tranche based on detailed design and commensurate to the severity of impacts1. The LARP will include detailed compensation and administration budgets and implementation schedules linking LAR tasks to the initiation of civil works.

5. Based on ADB policy/practice, the appraisal of the MFF and each specific tranche and the approval of project implementation will be based on the following LAR-related conditions:

1 Based on ADB Operation Manual (OM) F2/OP and BO (2006) a project is classified as Category “A” and a full

LARP is needed if > 200 people suffer significant impacts (relocation or loss of >10% of productive assets). A project will instead be classified as Category “B” when less than 200 people suffer significant impacts. Category “C” projects have no LAR impacts. No subproject will affect indigenous Peoples. The WB does not have a similar resettlement classification system but its policy also envisages that for minor impacts a shorter document, called “Abbreviated Resettlement Plan”, is prepared.

2

(i) Appraisal of MFF and Project 1. Conditional to preparation/disclosure of a

LARF for the whole MFF acceptable to ADB and preparation of the LARPs for the tranche projects requiring LAR.

(ii) Appraisal of Subsequent Projects. Conditional to review/update/disclosure of the LARF, and preparation of needed LARPs consistent with the revised LARF and acceptable to ADB for projects with LAR.

(iii) Contract Award for each Project. Conditional to the update/disclosure of the relevant LARPs based on the final design and accepted by ADB. The updated LARPs will reflect final impacts, final AP lists and final compensation rates and be readily implementable.

(iv) Provision of Notice to Proceed to Contractors. Conditional to the full implementation of the relevant LARP (full delivery of compensation and rehabilitation) for the relevant project. Such a condition will be clearly spelled out in the text of the civil works contract.

C. INDIGENOUS PEOPLES AND VULNERABLE GROUPS 6. No impacts on Indigenous Peoples are expected for the Program. Special attention will also be given to identifying and addressing the needs of disadvantaged groups such as the landless, the poor, female-headed households, the elderly and the disabled, through measures included in the LARP to try and improve (over and above cash compensations and restoration of) their livelihoods. D. LARP PREPARATION AND IMPLEMENTATION 7. LARP preparation activities will be initiated as part of the preparation of each tranche project starting with LAR screening tasks and ending with a readily implementable a LARP based on detailed design. Following the finalization of road alignment and identification of the land parcels, cross-sections design and land acquisition requirements a, Detailed Measurement Survey (DMS), a census of all AF and AP and a valuation of all affected asset will be carried out to assess the AF/P losses and relative compensation budgets. In addition, a sample socio-economic survey will be conducted based on the 20% of the AFs. The Socio-economic Survey will cover their major socio-economic features of the affected population (ethnicity, education level, modes of livelihood, and sources of income, poverty/income levels, and house type/value and land tenure types. The DMS and census survey include the following:

(i) Inventory of the 100% loss of land parcel and property (ii) Categorization and measurements of loss; (iii) Measurements of the affected assets/structures, including their replacement

valuation; (iv) AF characteristics, including social, economic and demographic profile; (v) The AP/AF Census will identify all AF and their members by number, gender and

age; all AF by land occupancy status; all severely AF (losing >10% of their land and income; and all vulnerable AFs (women headed family or family under poverty line); and

(vi) Identification of non titleholders. 8. LARP Preparation/Implementation Process. LARP preparation for the first tranche of the Program will be carried out by the PPTA consultants; the same tasks for the following tranches will be carried out by the detailed design consultants. LARP implementation will be

3

overseen by the supervision consultants. LARP preparation/implementation will be carried out according to the following process:

(i) LARP Preparation. This phase will be carried out in parallel with the preparation of the projects feasibility study (See Annex C for a standard outline of a LARP).

(ii) LARP Update/Finalization. This phase will be carried out during the preparation of detailed design and will include eventual updates of the impacts/AP data, possible revisions of compensation rates and the administrative work done to legalize legalizable APs. After the final LARP is approved by ADB, the civil works contracts will be signed.

(iii) LARP Implementation. This phase will be carried out after the final LARP is approved. In principle civil works will start only after all compensation and rehabilitation is provided to the APs, However, if in a road there are sections without impacts and sufficiently long to economically justify construction, the civil works can initiate immediately after the signing of contract awards. Following the preparation of a due diligence report fully documenting the absence of impacts,

E. LEGAL AND POLICY BACKGROUND 1. Georgia’s Laws and Regulations on Land Acquisition and Resettlement 9. In Georgia, the legislative acts given below regulate the issues of obtaining State ownership rights to privately owned land parcels based on the necessary public needs caused due to road constructions activities:

(i) The Constitution of Georgia, August 24, 1995; (ii) The Civil Code of Georgia, June 26, 1997; (iii) The Law of Georgia on Protection of Cultural Heritage; (iv) The Law of Georgia on Notary Actions; (v) The Law of Georgia on Privatization of State-owned Agricultural Land, July 8,

2005; (vi) The Law of Georgia on Ownership Rights to Agricultural Land, March 22, 1996; (vii) The Law of Georgia on Registration Ownership Rights to Immovable Property,

December 28, 2005; (viii) The Law of Georgia on the Rules for Expropriation of Ownership for Necessary

Public Need, July 23, 1999; and (ix) The Civil Procedural Code of Georgia, November 14, 1997.

10. The existing Laws provide that compensation for lost assets, including land, structures, trees and standing crops, should be based on the current market price without depreciation. Overall the above laws/regulations provide that the principle of replacement cost compensating at market value is reasonable and legally acceptable. The laws also identify the types of damages eligible to compensation and indicate that compensation is to be given both for loss of physical assets and for the loss of incomes. Finally, these laws place strong emphasis on consultation and notification to ensure that the APs participate in the process. Income loss due to loss of harvest and business closure will be compensated to cover net loss. The above-listed laws and regulations give the possibility of applying the following mechanisms for legal application of the property rights:

4

(i) Obtaining the right on way without expropriation through the payment of due compensation (on the basis of negotiations or a court decision) prior to commencement of the activities; and

(ii) Expropriation which gives the possibility of obtaining permanent right to land and/or other real estate property on the basis of Eminent Domain Law or a court decision through the payment of due compensation.

11. Attempts should first be made to acquire private land on the basis of negotiation with individual affected entities. Should the negotiation fail, the power of eminent domain will be sought, and expropriation process will start. Under the existing Law in Georgia, the president will issue an order for expropriation based on the request from relevant state agencies. Relevant regional court will assess the presidential order and determine the case of public needs, and grant the expropriation entity rights to obtain land. The court will also appoint a third party to assess the market value of lost assets and determine the compensation payable to relevant land owners accordingly to the value of assets thus found.

2. ADB’s Involuntary Resettlement Policy 12. The ADB Policy on Involuntary Resettlement is based on the following principles:

(i) Involuntary resettlement is to be avoided or at least minimized; (ii) Compensation/Rehabilitation provisions will ensure the maintenance of the APs’

pre-project standards of living; (iii) APs should be fully informed and consulted on LAR compensation options; (iv) APs’ socio-cultural institutions should be supported/used as much as possible; (v) Compensation will be carried out with equal consideration of women and men; (vi) Lack of legal title should not be a bar to compensation and/or rehabilitation; (vii) Particular attention should be paid to households headed by women and other

vulnerable groups, such as Indigenous Peoples, and appropriate assistance should be provided to help them improve their status;

(viii) LAR should be conceived and executed as a part of the project, and the full costs of compensation should be included in project costs and benefits; and

(ix) Compensation and resettlement subsidies will be fully provided prior to clearance of right of way/ ground leveling and demolition.

3. Comparison of Georgia Law/Regulation on LAR and ADB Resettlement

Policy 13. Overall, the legislation of Georgia adequately reflects the major provisions of the ADB Resettlement Policy but a few differences are to be noted (for a short summary of these Georgian laws see Annex A). The most significant of these differences is that under Georgian legislation/regulation, emphasis is put on the definition of formal property rights and on how the acquisition of properties for public purposes is to be implemented and compensated while in the case of ADB policy emphasis is put both on the compensation of rightfully owned affected assets and on the general rehabilitation of the livelihood of Affected People (AP) and Households (AH). Because of this, ADB policy complements the Georgian legislation/regulation with additional requirements related to (i) the economic rehabilitation of all AP/AF (including those who do not have legal/formal rights on assets acquired by a project); (ii) the provision of indemnities for loss of business and income, (iii) and the provision of special allowances covering AP/AH expenses during the resettlement process or covering the special needs of severely affected or vulnerable AP/Ahs (See Annex B for a synopsis on ADB’s Policy on

5

Invloumatry Resettlement). Also, in addition, the legislation of Georgia does not require any specific measure regarding the need to prepare LARPs based on extensive public consultations. The differences between Georgia law/regulation and ADB policy are outlined in Table1 below

Table 1: Comparison of Georgian Laws on LAR and ADB Resettlement Policy Georgia Laws and Regulations ADB Involuntary Resettlement Policy

Land compensation only for titled landowners In practice legaliizable land owners are also compensated after they are issued with the necessary papers

Lack of title should not be a bar to compensation and/or rehabilitation. Non-titled landowners receive rehabilitation.

Only registered houses/buildings are compensated for damages/demolition caused by a project

All affected houses/buildings are compensated for buildings damages/demolition caused by a project

Crop losses compensation provided only to registered landowners.

Crop losses compensation provided to landowners and sharecrop/lease tenants whether registered or not

Land Acquisition Committee is the only pre-litigation final authority to decide disputes and address complaints regarding quantification and assessment of compensation for the affected assets.

Complaints & grievances are resolved informally through community participation in the Grievance Redress Committees (GRC), Local governments, and NGO and/or local-level community based organizations (CBOs).

Decisions regarding LAR are discussed only between the landowners and the Land Acquisition Authorities.

Information on quantification, affected items value assets, entitlements, and compensation/financial assistance amounts are to be disclosed to the APs prior to appraisal.

No provision for income/livelihood rehabilitation, allowances for severely affected or vulnerable APs, or resettlement expenses.

ADB policy requires rehabilitation for income/livelihood, severe losses, and for expenses incurred by the APs during the relocation process.

No specific plan for public consultation is provided under the Georgian laws

Public consultation and participation is the integral part of ADB’s policy which is a continuous process at conception, preparation, implementation and finally at post implementation period

14. To reconcile the gaps between Georgia laws/regulations and ADB Policy, RDMRDI has drafted this LARF for the Project, ensuring compensation at replacement cost of all items, the rehabilitation of informal settlers, and the provision of subsidies or allowances for AFs that may be relocated, suffer business losses, or may be severely affected.

4. LARF Principles and Entitlements Adopted for this MFF 15. Based on the Georgian laws on land acquisition and ADB’s Policy on Involuntary Resettlement, 1995, core involuntary resettlement principles are developed for this MFF which are as follows:

(i) Land acquisition, and other involuntary resettlement impacts will be avoided or minimized exploring all viable alternative project designs;

(ii) where unavoidable, a time-bound LARP will be prepared and APs will be assisted in improving or at least regaining their pre-program standard of living;

(iii) consultation with APs on compensation, disclosure of resettlement information to APs, and participation of APs in planning and implementing sub-projects will be ensured;

(iv) vulnerable and severely affected APs will be provided special assistance; (v) Non-titled APs (e.g., informal dwellers or squatters, APs without registration details)

will receive a livelihood allowance in lieu of land compensation and will be fully compensated for losses other than land;

(vi) Legalizable APs will be legalized and fully compensated for land losses; (vii) Provision of income restoration and rehabilitation;

6

(viii) The LARP will be disclosed to the APs in the local language; (ix) Payment of compensation, resettlement assistance and rehabilitation measures

will be fully provided prior to the contractor taking physical acquisition of the land and prior to the commencement of any construction activities on a particular package; and

(x) Establishment of appropriate grievance redresses mechanisms to solve APs grievance if occurs.

F. COMPENSATION ELIGIBILITY AND ENTITLEMENTS FOR THE PROJECT 16. LAR tasks under the Project will be implemented according to a compensation eligibility and entitlements framework in line with both Georgia laws and regulation and ADB Policy. A summary entitlements matrix is included in Table 2 below.

Table 2: Compensation Matrix

Type of Loss Application Definition of APs Compensation Entitlements A. Land

Owner with full registration Cash compensation at replacement cost or through replacement land equal in value/productivity to the plot lost and at location acceptable to APs where feasible

Legalizable Owner These AP will be legalized and provided with cash compensation at replacement cost.

Permanent loss of agricultural land

AF losing agricultural land regardless of impact severity

Informal Settlers/ APs with no registration/valid documentation

One time self-relocation allowance in cash equal to 1 year at minimum salary

Owner with full registration Cash compensation at replacement cost or through replacement land equal in value to the plot lost and at location acceptable to APs where feasible

Legalizable Owner APs will be legalized and provided with cash compensation at replacement cost..

Renter/Leaseholder Rental allowances in cash for 3 months

Non-Agricultural Land AF losing their commercial/ residential land

Informal Settlers/ APs with no registration/valid documentation

One time self-relocation allowance in cash equal to 1 year at minimum salary

Buildings and Structures Residential and non residential structures/assets

All AFs regardless of their legal ownership/ registration status(including legalizable and Informal Settlers)

Full impact: Cash compensation for loss ofbuilding/ structures at full replacement costs free of depreciation and transaction costs Partial impact: compensation for repairs

Loss Of Community Infrastructure/Common Property Resources Loss of common property resources

Community/Public Assets Community/Government Reconstruction of the lost structure in consultation with community and restoration of their functions

Loss of Income and Livelihood Crops Standing crops affected All AFs regardless of legal

status (including legalizable and Informal Settlers)

Crop compensation in cash at market rate by default at to gross crop value of expected harvest.

Trees Trees affected All AFs regardless of legal status (including legalizable and Informal Settlers)

Cash compensation at market rate on the basis of type, age and productive value of the trees.

7

Type of Loss Application Definition of APs Compensation Entitlements Business/Employment Business/employment loss All AFs regardless of legal

status (including legalizable and Informal Settlers)

Owner: (i). (permanent impact) cash indemnity of 1 year net income; (ii) (temporary impact) cash indemnity of net income for months of business stoppage. Assessment to be based on tax declaration or, in its absence, minimum salary.. Permanent worker/employees: indemnity for lost wages equal to 3 months of minimum salary.

Allowances Severe Impacts >10% income loss All severely affected AFs

including informal settlers Agricultural income: 1 additional crop compensation covering 1 year yield from affected land. Other income: 1additional compensation for 3 months of minimum salary.

Relocation/Shifting

Transport/transition costs All AFs to be relocated Provision of sufficient allowance to cover transport expenses and livelihood expenses for the transitional period (up to 1 month).

Vulnerable People Allowances

AFs below poverty line, headed by Women, disabled or elderly

Allowance equivalent to 3 months of minimum salaryand employment priority in project-related jobs

Temporary Loss Temporary impact during construction

All AFs Due compensation will be assessed and paid based on this LARF during construction.

Unforeseen resettlement impacts, if any

Road Department and the construction contractor will address and mitigate/compensate unforeseen resettlement impact during project

1. Eligibility 17. APs entitled for compensation or at least rehabilitation provisions under the Project are:

(i) All APs losing land either covered by legal title/traditional land rights, legalizable, or without legal status;

(ii) Tenants and sharecroppers whether registered or not; (iii) Owners of buildings, crops, plants, or other objects attached to the land; and (iv) APs losing business, income, and salaries.

18. Compensation eligibility will be limited by a cut-off date to be set for each subproject on the day of the beginning of the AP Census and DMS. APs who settle in the affected areas after the cut-off date will not be eligible for compensation. They, however will be given sufficient advance notice, requested to vacate premises and dismantle affected structures prior to project implementation. Their dismantled structures materials will not be confiscated and they will not pay any fine or suffer any sanction.

2. Compensation Entitlements 19. Entitlement provisions for APs losing land, houses, and income and rehabilitation subsidies will include provisions for permanent or temporary land losses, buildings losses, crops and trees losses, a relocation subsidy, and a business losses allowance based on tax declarations and/or lump sums. These entitlements are detailed below:

(i) Agricultural land impacts will be compensated at replacement value in: (i) cash at

current market rates or based on an assessment of the reproduction cost of the affected land, or (ii) through replacement land equal in value/productivity to the plot lost and at location acceptable to APs if alternate land is feasible and available. When >10% of an AP agricultural land is affected, AP (owners, leaseholders and

8

sharecroppers) will get an additional allowance for severe impacts equal to the market value of a year’s gross yield of the land lost. In case of severe impact on other income, the APs will be paid additional compensation for 3 months income. Transaction taxes and fees will be paid by the EA or waived. Legalizable APs will be legalized and paid as titled owners. Non-legalizable APs will be compensated with one time self-relocation allowances in cash equal to 1 year of minimum salary. If the remaining part of a particular plot becomes inaccessible or unviable for cultivation or for any use after the acquisition, then the same can be compensated if the owner offers.

(ii) Non Agricultural Land (Residential/Commercial Land). Legal settlers will be compensated at replacement rate either (i) in form cash at current market rates free of transaction costs and depreciation or (ii) through replacement land equal in value to the plot lost and at location acceptable to APs if alternate land is feasible and available. Renters/leaseholders will receive a 3 months rent allowance. Non-titled and non-legalizable land users will be compensated with one time self relocation allowances in cash equal to 1 year of minimum salary.

(iii) Houses, buildings, and structures will be compensated in cash at replacement cost free of deductions for depreciation, and transaction costs irrespective of the registration status of the affected item. In case of partial impacts (<15%) and unwillingness of the owner to relocate, compensation will cover only the affected portion of a building and its full rehabilitation to previous use. Full compensation will be paid if partial impacts imperil the viability of the whole building.

(iv) Crops. Cash compensation at current market rates for the gross value of 1 year’s harvest by default. Crop compensation will be paid both to landowners and tenants based on their specific sharecropping agreements.

(v) Trees. Cash compensation at market rate based on type, age and productivity of trees.

(vi) Businesses. If business is lost permanently it will be compensated in cash equal to a 1-year income based on tax declaration or, if unavailable, based on the official minimum salary; temporary business losses will be compensated in cash for the business interruption period based on tax declaration or, if unavailable, official minimum salary.

(vii) Permanent Business Workers and Employees. Indemnity for lost wages for the period of business interruption up to a maximum of 3 months.

(viii) Relocation Subsidy. APs forced to relocate will receive a relocation subsidy sufficient to cover transport costs and living expenses for 1 month.

(ix) Community Structures and Public Utilities. Will be fully replaced or rehabilitated so as to satisfy their pre-project functions.

(x) Vulnerable People Livelihood. Vulnerable people (APs below poverty line and widow or elder headed households) will be given priority in employment in project-related jobs.

3. Assessment of Compensation Unit Values

20. The methodology for assessing unit compensation values of different items is as follows:

(i) Agricultural Land will be valued at replacement rates according to two different methodologies depending on whether in affected areas active land markets exist or not. (a) Where active land markets exist land will be compensated at replacement

rate based on a survey of land sales in the year before the impact survey. (b) Where active land markets do not exist land will be compensated based

9

on the reproduction cost of a plot with equal features, access and productivity to the plot lost. A clear valuation methodology for these cases will be detailed in the LARPs.

(ii) Houses/buildings will be valued at replacement value based on construction type, cost of materials, type of construction, labor, transport and other construction costs. No deduction for depreciation and transaction costs will be applied. For the partial impact (if the loss is less than 15% then compensation is paid for the repair of the affected structure)

(iii) Annual crops will be valued at net market rates at the farm gate for the first year crop. In the eventuality that more than one-year compensation is due to the APs the crops after the first will be compensated at gross market value.

(iv) Trees will be valued according to different methodologies depending whether the tree lost is a wood tree or a productive tree. (a) Wood trees will be valued based on age category (a. seedling; b. medium

growth and c. full growth) and wood value and volume. (b) Fruit/productive trees will be valued based on age (a. seedling; b. adult-not fruit

bearing; and c. fruit bearing). Stage (a) and (b) trees will be compensated based on the value of the investment made; stage (c) trees will be compensated at net market value of 1 year income x number of years needed to grow a new fully productive tree.

21. The unit compensation rates will be assessed by Project consultants or by the authorized independent evaluator based on clear and transparent methodologies acceptable to ADB. The assessed compensation rates will then be verified and certified by the resettlement division in RDMRDI.

4. Conditions for Expropriation 22. Acquisition of land through expropriation proceedings entails lengthy procedures often may be resisted. Such an approach will thus be pursued under the Program only in extreme cases when negotiations between APs and RDMRDI fail and no alternative land is available to implement a subproject. In these cases, however, RDMRDI will not occupy the needed plots until: (i) the proper judicial process as defined by the law is initiated; (ii) a court injunction has been obtained and properly communicated to the APs; and (iii) the compensation/rehabilitation amounts are deposited in an escrow account. G. GENDER IMPACT AND MITIGATION MEASURES 23. Women have important economic roles in project areas and engage in a very wide range of income making activities in the agricultural and marketing sector. The project will pay particular attention to ensure that women are the recipients of the compensation pertaining to their activities and to ensure that women who are de-facto household heads are clearly listed as beneficiaries of compensation and rehabilitation proceedings under the loan. In order to ensure the above the following actions will be considered:

(i) Include women in the impact enumerators. (ii) Impact assessment of AFs/APs indicating the total number of families and people

must be gender-disaggregated to pinpoint how many women are likely to be affected by the Project and establish their pre-Project conditions.

10

(iii) Women will be major participants in the consultation processes to determine and negotiate for compensation entitlements and implement the RP.

(iv) Special attention will be given to the impact of resettlement on women and other vulnerable groups during monitoring and evaluation of the RP.

H. PUBLIC CONSULTATION, PARTICIPATION AND DOCUMENTS DISCLOSURE 24. Concerned officials of centre, district/rayon, municipalities and villages/sacrebolu will be informed about the Project, and their assistance will be solicited in the conduct of the inventory of affected assets and the Census of APs and the DMS. Also, prior to the finalization of the LARP and its submission to Project authorities, the APs will be thoroughly informed on the results of the Census and DMS, and their preferences on compensation or other resettlement assistance will be given due consideration. The processes and mechanisms ensuring the active involvement of APs and other stakeholders will be detailed in the LARPs which will also include an appendix with date, list of participants, and minutes of consultation meetings. 25. This LARF in Georgian will be disclosed on the RDMRDI website and at RDMRDI offices before Project appraisal. The LARF in Georgian will also be disclosed to the APs at the relevant Rayon office (Gamgebeli) and at village administration (Sacrebolu) once subprojects are identified. Its English version will be disclosed on the ADB website prior to Project appraisal and after the LARF is endorsed by the Implementing Agency (IA) which will be RDMRDI in this case. Once a LARP for a subproject has been prepared and approved by RDMRDI and ADB it will be disclosed at relevant Rayon office (Gamgebeli) and at village administration (Sacrebolu). A pamphlet in Georgian, summarizing compensation eligibility and entitlement provisions, will be sent to all AP/AFs before the initiation of the compensation/rehabilitation process and before signing contract awards. The consultation process will be continued throughout the project cycle. I. INSTITUTIONAL ARRANGEMENTS 26. Asian Development Bank (ADB) will be the funding agency of the MFF. The compensation/rehabilitation program described in this LARF involves distinct processes and dynamics and different actors. The Road Department of the Ministry of Regional Development and Infrastructure of Georgia (RDMRDI) will be the Implementing Agency (IA) having the lead responsibility for road construction, as well as the implementation of this LARF and subsequently the LARP. RDMRDI with the assistance of the consultants will develop and implement the LARP for each project based on the policy and procedures set out in the LARF. In addition to the RDMRDI, a number of other government departments and private agents will play an instrumental role in the design, construction and operation of the project. Pursuant to the active legislation, the Ministry of Natural Resources and Environmental Protection is responsible for environmental issues. The Ministry of Justice is responsible for legal matters regarding land ownership, and National Agency of Public Registry (NAPR) within the Ministry of Justice is in charge of the registration of land ownership and its transfer through purchase agreement from landowners to the Road Department. The local government at Rayon and village level will also be involved. The role of each of these actors is detailed below.

1. RDMRDI 27. RDMRDI has overall responsibility for the MFF. This includes preparation, implementation and financing of all LAR tasks and cross-agency coordination. RDMRDI will exercise its functions through its existing resettlement division (DRD) which will be responsible

11

for the general management of the planning and implementation of all LAR tasks. 28. DRD. The DRD staffed with a sufficient number of LAR specialists, will be tasked with all LAR coordination tasks at central and local government level and will be responsible for: (i) screening the projects and ensuring that the LARPs are properly prepared and sent to ADB for review, (ii) supervising the consultants that prepare the LARPs and assist in their implementation; (iii) establishing needed LAR capacity at each regional level office where LAR is relevant; (iv) ensuring proper internal monitoring; and (v) hire, following ADB recommendation the external monitoring agency. DRD will also provide all needed documentation to ensure the prompt allocation of LAR budgets to the APs and will maintain the coordination of all LAR related activities. 29. Local RDMRDI Offices. The Regional RDMRDI offices will assist the activities of the DRD with one dedicated officer who will facilitate the communication between the DRD, the local governments and the APs and assist in implementing LAR tasks related to the local administration.

2. Consultants

30. Different types of consultants will be involved in LAR tasks:

(i) PPTA Consultants. These will include international and local LAR capacity and needed survey teams and will carry out all field-surveys and prepare the needed LARPs for the first tranche.

(ii) Design Consultants. These will include international and local LAR capacity and needed survey teams carry out the same activities for updating/finalizing the LARPs of first tranche based on the detailed engineering design and will also prepare LARPs for the following tranches.

(iii) Supervision Consultants. These will include international and local LAR capacity and needed survey teams and will assist in the overall supervision of the projects. The supervision consultants will also oversee LARP Implementation and carry out external monitoring and evaluation of the implementation of LARP for following tranches of the Program.

(iv) Independent Asset Valuators. These will be accredited private firms to be hired by the PPTA or Design consultants to carry out the evaluation of affected assets.

3. Local Governments

31. Local government especially at Rayon level has direct jurisdiction for land administration, valuation, verification and acquisition. To confirm the surveys and the asset valuations carried out by the LAR consultants RDMRDI through its consultants will establish in Rayon where LARPs are to be implemented a Rayon Level LAR team which will have designated officials from the Rayon administration. The LAR team at Rayon level will have close coordination with the village administration for the LAR activities. Effective inter-agency coordination at Rayon and village level will be assigned to the regional level RDMRDI.

4. Other Agencies and Institutions 32. Several other institutions will participate to the preparation and implementation of LAR tasks. These are:

12

Government of Georgia ADB

Mon

itorin

g A

genc

y/R

DM

RD

I S

uper

visi

on C

onsu

ltant

RDMDRI

DRD

Rayon Level LAR Team

Regional Level RDMDRI

Local Government (Village/Sacrebolu)

Affected People

(i) Ministry of Finance. The budgets for the implementation of the LARPs will be

provided to RDMRDI by the Ministry of Finance following the official approval of the final LARPs.

(ii) Ministry of Justice. The Ministry of Justice is responsible for legal matters regarding land ownership, and National Agency of Public Registry within the Ministry of Justice is in charge of the registration of land ownership and its transfer through purchase agreement from landowners to the Road Department.

(iii) Local Courts. In case of expropriation issues RDMRDI will have to rely on the Rayon court which based on due legal process will have to review the expropriation cases, carry out a hearing and decide whether the land can be expropriated and at what price. In order to expedite the expropriation process RDMRI will negotiate with the courts a fast-tracked action plan.

(iv) ADB. Beside supervising periodically the Project ADB will review all LARPs and provide clearance to contract awards signing and initiation of civil works to all subprojects with LAR.

33. The LAR organogram is provided below in Figure 1:

Figure 1: LAR Organogram and Action

J. COMPLAINTS AND GRIEVANCES

34. A grievance mechanism will be available to allow an AP appealing any disagreeable decision, practice or activity arising from land or other assets compensation. APs will be fully informed of their rights and of the procedures for addressing complaints whether verbally or in

PP

TA /D

esig

n C

onsu

ltant

Tea

m

13

writing during consultation, survey, and time of compensation. Care will always be taken to prevent grievances rather than going through a redress process. This can be obtained through careful LAR design and implementation, by ensuring full participation and consultation with the APs, and by establishing extensive communication and coordination between the affected communities, the EA, and local governments in general. Complaint & Grievances will be addressed through the process described below in Table 3.

Table 3: Grievance Resolution Process Land/ Crops Compensation Issues 1. First, complaints resolution will be attempted at village level with the involvement of village authorities and Rayon level LAR team at the sacrebolu level. 2. If the grievance is not solved at the sacrebolu level, then the AP will lodge the written complaint at the regional level RDMRDI. If after the regional level RDMRDI intervention no solution has been reached a grievance can be directly lodged to DRD/RDMRDI. The AP must lodge the complaint within 2 weeks after receiving response on the original complaint from the regional level RDMRDI and must produce documents supporting his/her claim. 3. The DRD/RDMRDI at central level will provide a response within 2 weeks of registering the complaint. The DRD/RDMRDI decision must be in compliance with this LARF provisions. 4. Should the grievance redress system fail to satisfy the AP, they can pursue further action by submitting their case to the appropriate court of law (Rayon Court).

K. MONITORING AND EVALUATION 35. Land acquisition and resettlement tasks under the Program will be subjected to monitoring. Monitoring will be the responsibility of RDMRDI. Internal monitoring will be carried out routinely by DRD/RDMRDI. The results will be communicated to ADB through the quarterly project implementation reports. Indicators for the internal monitoring will be those related to process and immediate outputs and results. This information will be collected directly from regional RDMRDI level and reported monthly to DRD/RDMRDI to assess the progress and results of LARP implementation, and to adjust the work program, if necessary. The monthly reports will be quarterly consolidated in the standard supervision reports to ADB. Specific monitoring benchmarks will be: (i) Information campaign and consultation with APs; (ii) Status of land acquisition and payments on land compensation; (iii) Compensation for affected structures and other assets; (iv) Relocation of APs; (v) Payments for loss of income; (vi) Selection and distribution of replacement land areas; and (vii) Income restoration activities

36. The above information will be collected by DRD/RDMRDI which is responsible for monitoring the day-to-day resettlement activities of the project through the following instruments:

(i) Review of census information for all APs; (ii) Consultation and informal interviews with APs; (iii) In-depth case studies; (iv) Sample survey of APs; (v) Key informant interviews; and (vi) Community public meetings.

37. External monitoring will be carried out twice a year, and its results communicated to DRD/RDMRDI and ADB through semi-annual reports. Subprojects whose implementation time frame will be under six months will be monitored only once. RDMRDI will need external help for the monitoring of first tranche project LAR activities. However, the external monitoring for the following tranches will be carried out by the supervision consultant. The external monitoring will also assess the status of project affected vulnerable groups such as female-headed households,

14

disabled/elderly and families below the poverty line. Indicators for External Monitoring tasks will include:

(i) Review and verify internal monitoring reports prepared by DRD/RDMRDI; (ii) Review of the socio-economic baseline census information of pre-displaced

persons; (iii) Identification and selection of impact indicators; (iv) Impact assessment through formal and informal surveys with the affected

persons; (v) Consultation with APs, officials, community leaders for preparing review report;

and (vi) Assess the resettlement efficiency, effectiveness, impact and sustainability,

drawing lessons for future resettlement policy formulation and planning.

38. The RDMRDI will carry out a post-implementation evaluation of each LARP about a year after completion of its implementation. The compelling reason for this study is to find out if the objectives of the LARP have been attained or not. The benchmark data of socioeconomic survey of severely affected APs conducted during the preparation of the LARP and Poverty Social Assessment (PSA) will be used to compare the pre and post project conditions. The post- implementation evaluation will recommend appropriate supplemental assistance for the APs should the outcome of the study show that the objectives of the LARP have not been attained. The following will be considered as the basis for indicators in post implementation evaluation of the project:

(i) Socio-economic conditions of the APs in the post-resettlement period; (ii) Communications and reactions from APs on entitlements, compensation,

options, alternative developments and relocation timetables etc.; (iii) Changes in housing and income levels; (iv) Rehabilitation of informal settlers; (v) Valuation of property; (vi) Grievance procedures; (vii) Disbursement of compensation; and (viii) Level of satisfaction of APs in the post resettlement period.

L. CAPACITY BUILDING AND TRAINING IN LARP IMPLEMENTATION 39. To allow an effective execution of all LAR related tasks some expansion of the capacity on LAR currently available at DRD/RDMRDI may be needed. As soon as the project will become effective RDMRDI will carry out a capacity need assessment and will define the capacity building activities and if needed the additional experts required. Financing for these capacity building initiatives will be included under the capacity building component of the Project. 40. Capacity building exercise will be needed at the Rayon level. The designated team at the Rayon level for the LAR activities will be provided with the capacity enhancement related to the LAR planning and implementation and will be made familiar with ADB’s policy on Involuntary Resettlement. This will be done through on the job training and by participation with the LAR activities. The consultants responsible for the LAR activities in various stages, i.e., feasibility study, detailed design and supervision will work closely with the Rayon level LAR team. A continuous consultation process and informal training through discussion with the Rayon level LAR team and its due involvement in the planning and implementation of LAR activities will be facilitated by the consultant’s team.

15

41. All concerned staff both at DRD, Rayon and field level involved in LAR activities will undergo a week-long orientation and training in ADB resettlement policy and management. At the very beginning of Project implementation the training will be provided by a consultant hired by RDMRDI, later it will be provided by DRD. Training will cover the following topics:

(i) Principles and procedures of land acquisition; (ii) Public consultation and participation; (iii) Entitlements and compensation & assistance disbursement mechanisms; (iv) Grievance redress; and (v) Monitoring of resettlement operations.

M. RESETTLEMENT BUDGET AND FINANCING 42. All RP preparation and implementation costs, including cost of compensation and LAR administration, will be considered an integral part of Project cost and will be contributed as a counterpart fund by the Georgia Government, in particular RDMRDI. Each LARP will include a budget section indicating (i) unit compensation rates for all affected items and allowances, (ii) methodology followed for the computation of unit compensation rates, and (iii) a cost table for all compensation expenses including administrative costs and contingencies. Costs for external monitoring tasks and for the preparation of surveys and LARPs can be allocated under the loan.

43. Being the project owner, RDMRDI is responsible for the timely allocation of the funds needed to implement the RPs. Allocations will be reviewed twice a year based on the budget requirements indicated by the LARPs. As per the LAR finances flow the budget for compensation and rehabilitation will be directly disbursed by RDMRDI to the AP.

N. LARP IMPLEMENTATION PROCESS 44. Based on experience in Georgia the Preparation and implementation of a LARP may take up to a few months. The basic LAR-related steps for the preparation and implementation of a LARP are summarized on Box 1 below.

BOX 1: LAR TASKS PROCESS Step Action Responsibility A) LARP PREPARATION

1 Assessment of Project’s Poverty and Social Impacts RDMRDI

2 Finalization of Detailed design Design consultants

3 Prepare surveys forms for Census and DMS, train local Census and DMS teams, and establish coordination with relevant local government agencies. Consultant

4 Collection of cadastral and land parcel maps of the project area Consultants/DRD/NAPR

5 Verify land records in affected areas, update cadastral maps and carry out impacts and valuation surveys – Detailed Measurement Survey (DMS)

Consultant/DRD/Rayon level LAR Team/

7 Conduct public consultations Consultant/DRD/Rayon Level LAR Team

8 Negotiations with APs Consultant/DRD/Regional RDMRDI

9 Integrate data from Census into the RP. Consultant

10 Submission of LARP to RDMRDI, local governments and ADB for approval. Consultant/DRD/ADB

11 Disclosure Consultant/DRD

B) LARP Finalization (Detailed Design)

16

1 Detailed final alignment fixed Design Consultant

2 Review of impacts and AP lists based on detailed design Consultant/ Regional RDMRDI/ DRD/Rayon Level LAR Team

3 Review of prices based on the updated rate Consultant/ Regional RDMRDI/ DRD/Rayon Level LAR Team

4 Legalization of legalizable Consultant/ Regional RDMRDI/ DRD/Rayon Level LAR Team

5 Preparation of the final LARP Consultant/DRD

6 ADB Approval ADB

7 RP disclosure: Distribution of RP and information pamphlets in Georgia in the affected communities; posting of RP in English on the ADB website

DRD/Consultant/Rayon Level LAR team/ADB

8 Signing of civil contract award ADB/RDMRDI

C) RP IMPLEMENTATION

1 Approval of Contract awards Signing ADB

2 Detailed Schedule for compensation action plan DRD/RDMRDI

3 Distribution of Relocation Notices to APs RDMRDI/ DRD/Regional RDMRDI/Rayon Level LAR team

4 Award of Cheques for Land Compensation RDMRDI/DRD/Regional Level RDMRDI

5 Award of Cheques for other Compensation & Assistance/ Rehabilitation RDMRDI/DRD/ Regional Level RDMRDI

6 Demolishing/ Relocation of Affected Structures/Assets RDMRDI

7 Review of RP Implementation through a compliance report RDMRDI/DRD/IMA/ADB

8 If RP Implementation found satisfactory, Notice to proceed for Civil works is issued ADB/RDMRDI

D) POST-IMPLEMENTATION TASKS

1 Independent evaluation of LARP RDMRDI (through External Help)

E) CYCLICAL/CONTINUOUS TASKS

1 Internal monitoring. Quarterly reporting to ADB DRD

2 External Monitoring. Semi-annual reporting to ADB RDMRDI/Supervision Consultant

3 Grievances Redress/Law Suites DRD/Regional level RDMRDI/Court

4 Inter-agency coordination and Communication with AP RDMRDI/DRD/Regional Level RDMRDI

17

ANNEX A

SYNOPSIS OF SELECTED GEORGIA LAWS AND REGULATIONS ON LAR A. The Constitution of Georgia 1. The Constitution determines the essence of private ownership and defines presumption of inviolability however also regulates the issues related to compensation and expropriation of land and immovable property for necessary public need. The Constitution of Georgia ensures the publicity of information. Pursuant to the Article 21 of the Constitution of Georgia “the right of ownership and inheritance is declared and secured”. No body is eligible cancel the universal right of ownership and legacy. Throughout of the necessary public need or if the urgent necessity has emerged, the Article 21.3 of the Constitution allows the expropriation of the private ownership however, only according to the Court Decision or under the rules identified in the organic law2 on basis of the appropriate and fair reimbursement.

2. Other articles of the Constitution of Georgia also create legislative basis in respect with Land Acquisition and resettlement issues. These considers the State actions for expropriation of land for urgent public need, i.e. exercising the right of expropriation (power of eminent domain), also information disclosure and public consultations, protection of cultural heritage and grievance redress related to land acquisition and resettlement of population.

3. The Constitution ensures the right of a citizen to live in safe and healthy environment and use natural and cultural environment. The State undertakes environment protection measures to secure safe environment for people. People have the right to obtain "full, true and timely information" in regard with their work place and residential environment.

4. The Article 42 of the Constitution makes the citizens eligible to claim, in particular protects them and encourages appealing to the court for protection of their rights and freedom. B. Civil Code of Georgia 5. The Civil Code of Georgia regulates private civil relationships and evolves property rights, obligations, family law and the law on inheritance. Those regulations of the Civil Code that describes ownership right to property and considers right to build, servitude and other rights directly apply to the given project.

6. Ownership Rights. The ownership right entitles its beneficiary to freely possess and use property. It may be limited under the legislation or contractual basis. Ownership on the land parcel gives implicit right to land owner to implement construction activities if it is not restricted by any agreement or law. Alienation of real property is not limited under the Civil Code of Georgia. Pursuant to the article 183 of the Civil Code of Georgia “in order to purchase real property the agreement shall be made in a written format and the ownership right shall be registered on the name of the buyer at the Public Register”. The agreement - based on which one person purchases and the other sells the real property may be notarized. The agreement also may be proved by the person identified under the law (Article 69 of the Civil Code of Georgia). Presently the agreement of sales transaction of real property may be proved by the representative of the Public Register. The presumption of veracity and completeness of entries operate with respect to the Public Register, pursuant to the paragraph 1, Article 312 “an entry in the Public Register shall be deemed to be accurate until its inaccuracy is proven

2 In the hierarchy of the laws the Organic Law stands between the Constitution and other laws, what highlights the

significant importance of the latest.

18

7. Right to Build. The owner is allowed to transfer a land plot to another person in temporary usage (not to exceed 59 yeMDFG) for charge or free of charge. The transferee obtains the right to build a building/construction on or under the land plot, as well as to assign and transfer this right under inheritance or tenancy, borrowing or renting. The construction right may cover such part of a land plot that is not necessary for the actual construction but allows a better use of the facility constructed on the basis of the construction permit. Termination of the construction right requires consent from the landowner. Based on the Article 180 of this Code, if a land parcel lacks the access to public roads that are necessary for its adequate use, the other owner may claim from a neighbour to tolerate the use of his land parcel by the owner for the purpose of providing the necessary access. The mentioned article may be used for road construction, though the determination of necessary right of way is rather complicated procedure and in case of road construction evolves the obligations to prove the existence of the elements of such rights. In case of necessary right of way, the implementer of road project shall have the right to undertake road construction notwithstanding the owner’s will.

8. Right of Servitude. This right shall also be noted that according to the Civil Code of Georgia means the restriction imposed onto a land parcel or real property in favor of the owner (beneficiary) of another land parcel or real property. The Beneficiary is granted the right to use land parcel under restriction with some conditions and /or restricts undertaking specific activities or prohibits land owner to exercise some rights against this land parcel. However, in regard with this project, terms and conditions for transfer of any right (among them ownership, construction, necessary right of way or servitude) shall be defined against each land parcel in accordance to the identified rule and on the basis of the agreement entered between the land owner and the party holding appropriate right to act so. This agreement shall be registered at the Public Register. C. Law of Georgia on the Protection of Cultural Heritage 9. In addition to the Constitution of Georgia affirming the State's obligation to protect cultural heritage and requiring each citizen to care for, protect and preserve cultural heritage the Law of Georgia on Protection of Cultural Heritage defines the legislative principals for protection of existing cultural heritages in Georgia.

10. According to the Law, State protection of cultural heritage is undertaken by the Ministry of Culture, Monuments Protection and Sport, Ministry of Justice of Georgia, local self-government bodies, as well as other State Institutions, Public and Legal Persons of Private Law; On the territories of Abkhazia and Adjara autonomous republics the corresponding bodies of Abkhazia and Adjara autonomous republics within the scope of authority defined under the legislation of Georgia. It is worth to be mentioned that the State and local self-government bodies exercise their authorities in the sphere of protection of cultural heritage in accordance to the Constitutional Agreement between the State and the Orthodox Church of Georgia. The Ministry of Culture, Monuments Protection and Sports of Georgia provides general coordination and manages the activities undertaken in this sphere.

11. In respect with the ownership rights, the Law identifies some differentiations. Namely, the alienation of the State-owned land parcel - located within the zone of State-owned monument, considered as cultural valuables, or located within archeologically protected area - with the right to possess and use the Law considers the agreement with the Ministry of Culture, Monuments Protection and Sports with the terms and conditions of protecting and care being identified ahead. On the other hand, the Law directly restricts alienation of the monuments under private ownership that can only be alienated under the right to possess, and use and with the terms and conditions to care-and protect.

19

D. The Law of Georgia on Notary Actions 12. The stated law defines the types of notary actions and rule of their implementation. Also the law defines which insittutions and authorized persons except the Notaries have right to conduct Notary actions within the territory of Georgia and beyond it. On the basis of the Article 42 of the Law the local self-governments have right to implement Notary actions related to inheritance, accuracy of the copy to the original document, proving the fact that a citizen is alive, proving the fact of a citizen’s ceratin location. Rural population often apply to local self-governments to condact certain notary actions. Especially, when it is required to identify a person and a document, or the notary actions are required to replace the deceased head of the household with a new member. This rule is often utilized in regsitration of the land parcels when as the owner of the land parcel the other member of the household is registered in place of the deceased member. The representatives of the Consulates of Georgia (consuls) also other key persons at the Consulates are eligible to conduct notary actions on behalf of the State of Georgia beyond the territory of the country. (Article 43). Citizens being abroad may apply to the Consulate of Georgia in the county of their location. E. The Law of Georgia on Privatization of State-owned Agricultural Land 13. The Law regulates the privatization of State-owned agricultural land. On the basis of this law the leased or non leased State-owned agricultural land subject to privatization. However, the categories of agricultural lands listed below do not subject to privatization:

(i) grazing lands except the grazing lands which before law enactment were leased; grazing lands attached to existing structures being under ownership of legal and/or physical persons or state ownership in accordance to the rule refined by the Law;

(ii) Cattle-driving routs; (iii) water fund land, except fish breeding artificial ponds and the lands of common

water use category utilized as agricultural lands in accordance to the Law of Georgia on Water.

(iv) Forest fund land used under agricultural designation; (v) Recreation lands; (vi) Lands allocated to Historical monuments, nature and religious monuments; (vii) Land of protected areas; (viii) Agricultural lands assigned as reform land in Adjara Autonomous republic; (viii) Agricultural lands being used by Budgetary Institutions and legal entities of public

law in the form of usufruct.

14. Privatization of the two categories (forest fund and recreation land) of agricultural land is still allowed, although only for development of resort-recreation infrastructure in accordance to the decision of the Government of Georgia. F. The Law of Georgia on Ownership to Agricultural Land 15. The current law is completely different from the initial version adopted in 1996. The changes made in this law in different times (among them the amendments on the basis of the Law No. 389 as of July 14, 2000) have significantly changed its initial format and simplified to maximum extend the procedures regulated by this Law. 16. Article 3.1. Defines that "a land parcel with or without household structure that is registered at the public register and used for cattle-breeding and plant cultivation produces is

20

considered as an agricultural land parcel" with existing household and additional structures or without them. Also the share of a member of household community within the shared hay fields, grazing lands or forestry areas and the part of the agricultural land that may be the object "of separate ownership right" (Article 3.2). 17. The same Law determines that the ownership right to agricultural land is granted to the State, citizen of Georgia, household (komli) and legal person registered in accordance to the legislation of Georgia, which carries out his activities in agricultural sphere. Besides, the Law declares the State, private and community ownership right to grazing lands in the high mountain regions (Article 43). 18. Also, according to the limitations determined under this law, a foreigner and legal person registered abroad held ownership right only to the bequeathed agricultural land parcels and foreigners also in case when as citizens of Georgia they reasonably possessed agricultural land parcels. Besides, it is worth to be considered that foreigners and legal persons registered abroad are obliged to alienate privately owned agricultural land parcels to the citizen of Georgia, Komli and/or legal person registered in Georgia according to the legislation of Georgia within six months period since they obtained private ownership to the given land parcel. Besides, in case this legal requirement is neglected, private ownership to the agricultural land parcels privately owned by foreigners and legal persons registered abroad shall be taken away under the Court Decision and in return of due compensation. (The standards identified by the Law of Georgia on the Rules for Expropriation of Ownership for Necessary Public Need shall also be exercised in given case). 19. According to Articles 6 and 8, acquisition of agricultural land is allowed on the basis of ordinary rules and general restrictions. Ordinary rule considers land alienation without any permits and other limitations, and general restrictions consider land alienation only on the basis of the consent of co-owner of shared property. In case of agricultural land acquisition the lessee has the priority right to purchase the land. (Article10). Alienation is restricted if the area after this action will be less then 5 hectare (Article 9). The Law defines Tax sanctions if land has not been cultivated for 2 yeMDFG and for non-payment of land tax and non transmission to the other person in lease condition. In such cases the law does not directly state any type of penalty and only refers that in described cases shall be exercised the sanctions under the Tax legislation (Article 20). G. Law of Georgia on Registration of Rights to Immovable Property 20. The Law defines the rules, terms and conditions for registration of rights to immovable property (things), rights and obligations of the subjects participating in registration procedures. The goal of this Law is to declare and verify ownership rights for immovable property (things) within the territory of Georgia (so as some other rights out of subjective, guarantee and liability relationships) through registration of these rights into the Public Register. The Law describes the rules set for organization and functioning of Public Register. Pursuant to the Law ownership right to real property, mortgage, right to build, usufruct, servitude, lease, sub-lease, rent, sub-rent, lending subject to registration (Article 13.2). 21. This law ensures successful process of expropriation and obtaining of necessary right of way since in case of purchasing immovable property from an owner, it is required that land and real property is registered into the public register to provide legal validity to the sales agreement. Pursuant to the active legislation of Georgia, acquisition (purchase) of private property is legally valid and ownership rights are declared only after its registration into the Public Registry.

21

H. The Law of Georgia on the Rules for Expropriation of Ownership for Necessary Public Need 22. The Law of Georgia of “Rules for Expropriation of Ownership for Necessary Public Need” (July, 23, 1999) specified the expropriation procedures, liabilities and implements the rules. The Rules for Expropriation of the ownership which has a possible usage in Georgia in some occasions including Road construction will be issued Regional (civil) Court verdict on the basis of the Presidential Decree. 23. According to the Constitution of Georgia the expropriation of the property in the process of construction of the magisterial motor road is permitted for necessary public need. The process of Expropriation is to be undertaken only by the Court Decision of the President of Georgia and corresponding instances. Expropriation is undertaking by means of compensation payment which is to be corresponding to market value and honest. The State of Georgia has a constitutional right to carry out acquisition property through Expropriation instead of payment of legislative compensation (Clause 21). H. Procedural Civil Code of Georgia 24. The general courts of Georgia consider the cases according to the rules identified under the Procedural Civil Code of Georgia. The requirements of the procedural law are exercised during the lawsuit, during implementation of separate procedural actions or execution of the court decision. 25. The Procedural Civil Code of Georgia also regulates those cases when determination of the defendant is impossible. This may be important for the Project in the cases when the landowner is not found and correspondingly ownership to his/her land parcel cannot be obtained in legally valid manner, i.e. it is impossible to enter corresponding agreement with the landowner or him/her cannot sign other type of document. 26. The above-listed laws and regulations give the possibility of applying the following three mechanisms for legal application of the property rights: 27. Obtaining the road right of way without expropriation through the payment of due compensation (on the basis of negotiations or a court decision) prior to commencement of the activities:

(i) Expropriation which gives the possibility of obtaining permanent right to land and/or necessary road on the basis of Eminent Domain Law or a court decision through the payment of due compensation;

(ii) Expropriation of private properties for urgent public necessity, which gives the possibility of obtaining permanent rights on land and/or necessary road for the purpose of national security or accident prevention. Expropriation is to be made on the basis of the Presidential Decree on Expropriation through the payment of due compensation to affected people.

28. If applied adequately the above listed mechanisms can ensure the appropriate consideration of lawful interests of all parties and the due observation of the existing legislations.

22

ANNEX B

SYNOPSIS ON ADB POLICY ON INVOLUNTARY RESETTLEMENT 1. Involuntary resettlement should be avoided whenever feasible. 2. Where population displacement is unavoidable, it should be minimized by providing viable livelihood options. 3. Replacing What is Lost. If individuals or a community must lose all or part of their land, means of livelihood, or social support systems, so that a project might proceed, they will be compensated and assisted through replacement of land, housing, infrastructure, resources, income sources, and services, in cash or kind, so that their economic and social circumstances will be at least restored to the preproject level.3 All compensation is based on the principle of replacement cost. 4. Each involuntary resettlement is conceived and executed as part of a development project or program.4 ADB and executing agencies or project sponsors, during project preparation, assess opportunities for affected people to share project benefits. The affected people need to be provided with sufficient resources and opportunities to reestablish their livelihoods and homes as soon as possible, with time-bound action in coordination with the civil works. 5. The affected people are to be fully informed and closely consulted. Affected people are to be consulted on compensation and/or resettlement options, including relocation sites, and socioeconomic rehabilitation. Pertinent resettlement information is to be disclosed to the affected people at key points, and specific opportunities provided for them to participate in choosing, planning, and implementation options. Grievance redress mechanisms for affected people are to be established. Where adversely affected people are particularly vulnerable groups, resettlement planning decisions will be preceded by a social preparation phase to enhance their participation in negotiation, planning, and implementation. 6. Social and Cultural Institutions. Institutions of the affected people, and, where relevant, of their hosts, are to be protected and supported. Affected people are to be assisted to integrate economically and socially into host communities so that adverse impacts on the host communities are minimized and social harmony is promoted. 7. No Formal Title. Indigenous groups, ethnic minorities, pastoralists, people who claim for such land without formal legal rights, and others, who may have usufruct or customary rights to affected land or other resources, often have no formal legal title to their lands. The absence of a formal legal title to land is not a bar to ADB policy entitlements. 8. Identification. Affected people are to be identified and recorded as early as possible in order to establish their eligibility through a population record or census that serves as an eligibility cutoff date, preferably at the project identification stage, to prevent a subsequent influx 3 If the residual of an asset taken is not economically viable, compensation and other assistance are provided as for

the entire asset. In this case, affected people have the option to retain their assets. Nonland based options may be used where land is not the preferred option of the affected people; or where land of similar quality and quantity is not available.

4 ADB may treat resettlement either as part of the main investment or as a free-standing resettlement project that is prepared, financed, and implemented in association with the main investment.

23

of encroachers or others who wish to take advantage of such benefits.5 9. The Poorest. Particular attention must be paid to the needs of the poorest affected people,6 and vulnerable groups that may be at high risk of impoverishment. This may include those without legal title to land or other assets, households headed by females, the elderly or disabled and other vulnerable groups, particularly indigenous peoples.7 Appropriate assistance must be provided to help them improve their socio-economic status. 10. The full resettlement costs are to be included in the presentation of project costs and benefits. This includes costs of compensation, relocation and rehabilitation, social preparation and livelihood programs as well as the incremental benefits over the without-project situation (which are included in the presentation of project costs and benefits). The budget also includes costs for planning, management, supervision, monitoring and evaluation, land taxes, land fees, and physical and price contingencies. Where loans include subprojects, components or investments prepared only after project approval and loans through financial intermediaries that are likely to cause involuntary resettlement, sufficient contingency allowance must be allocated for resettlement prior to approval of the loan. Similarly, resettlement plans should also reflect the timeframe for resettlement planning and implementation. 11. Eligible8 Costs of Compensation. Relocation and rehabilitation may be considered for inclusion in ADB loan financing for the project, if requested, to assure timely availability of the required resources and to ensure compliance with involuntary resettlement procedures during implementation.

5 An eligibility cutoff date should be established as soon as possible in the project cycle. 6 The resettlement planning documents will, in each case, define the poorest and vulnerable groups, using, as

appropriate, the poverty line as defined in the poverty partnership agreement with the DMC concerned, or other accepted ADB documents. A range of other documents may also provide information on poverty in the project area.

7 When significant indigenous peoples or ethnic minority issues are identified, special attention will be paid to exploring viable alternative designs that will reduce or eliminate such impacts. An Indigenous Peoples Development Plan may be required in addition to a resettlement plan. If the indigenous people issues are judged to be less than significant, specified “indigenous people actions” within the resettlement plan may suffice to meet the indigenous people policy objectives.

8 Involuntary resettlement costs eligible for loan financing may include, for example, income restoration, relocation, site development, social preparation, monitoring, and evaluation.

24

ANNEX C

OUTLINE OF A STANDARD LARP

1. LAR Issues for the Scheme. This chapter describes the scheme activities and items requiring LAR; alternative options, if any, considered to minimize land acquisition and its effects; and why remaining effects are unavoidable.

2. Scope of Land Acquisition and Resettlement. This chapter describes the preparation of the impacts (who carried it out and when it was initiated) and provides a full assessment of each type of impact and a census of affected peoples as described in the LARF. The chapter also includes a description of the methodology followed to determine unit-compensation rates for each affected item and subsidy/allowance.

3. Objectives, Policy Framework, and Entitlements. Based on the LARF, this chapter outlines the eligibility and compensation framework for the scheme.

4. Consultation and Grievance Redress Participation. This chapter summarizes procedures for redress of grievances by people affected described in LARF and describes the consultation/participation process and grievance redress that occurred in the subproject at hand.

5. Compensation, Relocation, and Income Restoration. This chapter outlines the income restoration measures to be implemented.

6. Institutional Framework. This chapter outlines the institutional arrangements for the scheme based on this LARF. It includes the following issues: responsibilities for main tasks and for planning, negotiating, consulting, approving, coordinating, implementing, financing, monitoring, and evaluating land acquisition and resettlement.

7. Resettlement Budget and Financing. This chapter provides the unit compensation rate for each affected item and assesses the LAR budget for the scheme. The LAR budget will include land acquisition and eventual land acquisition costs, amounts due for crop compensation and for the subsidies and allowances, monitoring and evaluation costs, and administrative costs and will be adjusted for inflation and applicable taxes.

8. Implementation Schedule. This chapter provides a time schedule showing the LAR process and linking LAR tasks with civil works implementation.

9. Monitoring and Evaluation. This chapter specifies arrangements for routine and independent monitoring and evaluation activities.