Document of

Tne World Bank

FOR OFFICIAL USE ONLY C

Report No. 9227

PROJECT COMPLETION REPORT

TURKEY

CUKUROVA REGION URBAN ENGINEERING PROJECT(LOAN 2537-TU)

DECEMBER 21, 1990

'S.

Infrastructure DivisionCountry Department IEurope, Middle East ano North Africa Regional Office

This document has a restricted distribution and may be used by recipients only in the performance oftheir official duties. Its contents may not otherwise be disclosed without World Bank authorization.

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MEASURES AND EO'J VALENTS

1 hectare - 10,000 square meters- 2.47 acres

1 meter - 39.37 inches1 square meter - '0.76 square feet1 cubic meter = 264 US gallons

GLOSSARY OF ABBREVIATIONS

CMTA - Cukurova Municipalities Training AssociationCPA - Cukurova Project AccountCUEP - Cukurova Region Urban Engineering P'ojectCUDP - Cukurova Region Urban Development ProjectDSI - State Hydraulic WorksDSF - Development Support FundGDTC - General Directorate of Title and CadastreHUDC - Housing and Urban Development CompanyIB - Iller BankKGM - State Highways AuthorityMHF - Mass Housing FundMOI - Ministry of InteriorMGH - Mapping General Headquarters (of Turkish Armed Forces)MOE - Ministry of EducationMOF - Ministry of FinanceMOH - Ministry of HealthMPWS - Ministry of Public Works and SettlementPCR - Project Completion ReportPCU - Project Coordination Unit (SPO)PRIMU Project Review, Implementation and Management Unit (Iller Bank)PTT - Posts and Telecommunications AuthoritySPD - State Personnel DirectorateSPO - State Planning OrganizationTEK - Turkish Electric AuthorityUEA - Urban Expansion AreasUPPRG - Undersecretariat Project Promotion and Research Group

(of the SPO)WSC - Water and Sanitation CorporationUNDP - United Nations Development Program

TH WOLtD &l41 FOR OFFICIAL USE ONLYWasH"'on. O.C. 20433

U.S A

Office of Dinsc -Goe l

December 21, 1990

MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT

SUBJECT: Project Completion Report on TurkeyCukurova Region Urban Engineering Project (Loan 2537-TU)

Attached, for information, is a copy of a report entitled "ProjectCompletion Report on Turkey - Cukurova Region Urban Engineering Project (Loan2537-TU)" prepared by the Europe, Middle East and North Africa Regional Officewith Part II contributed by the Borrower. No audit of this project has been madeby the Operations Evaluation Department at this time.

Attachment

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PROJECT COMPLETION REPORT

TURKEYCUKUROVA REGION URBAN ENGINEERING PROJECT

(LOAN 2537-TU)

TABLE OF CONTENTS

Page No.

Preface . ......................................................... iEvaluation Summary .............................................. ii

PART I. PROJECT REVIEW FROM THE BANK'S PERSPECTIVE

1. Background, Sector Development Objectives, and PolicyContext ...... . . .......................... 1

2. Project Objectives and Description. 23. Project Design and Organization. 34. Project Implementation. 55. Project Results. 96. Project Sustainability .127. Bank Performance .128. Borrower Performance .149. Project Relationships .1410. Compliance With Covenants .1511. Consulting Services .1512. Project Documentation and Data .1613. Findings and Lessons .16

PART II. PROJECT REVIEW FROM THE BORROWER'S PERSPECTIVE

Summary of Implementation Results .18Performance of Project Agencies .23Summary of Findings and Lessons Learned from the Borrower'sPerspective .26

PART III. STATISTICAL INFORMATION

Table 1. Related Bank Loans/Credits .28Table 2. Project Timetable .29Table 3. Cumulative Estimated and Actual Disbursements 30Table 4. Project Financing .31Table 5. Studies, Feasibility and Design Work .32Table 5A. Project Costs .39Table 6. Statement of Compliance with Legal Covenants 40Table 7. Missions .41Table 8. Bank Staff Resources .43Table 9. Suimmary of Arrangements for Implementation,

Finance and Cost Recovery .44

r This document has a restricted distribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

PROJECT COMPLETION REPORT

TURKEYCUKUROVA REGION URBAN ENGINEERING PROJECT

(LOAN 2537-TU)

PREFACE

This is the Project Completion Report (PCR) on the Cukurova RegionUrban Engineering Project in Turkey, for which Loan 2537-TU in the amount ofUS$9.2 million was approved on May 9, 1985. The loan was closed on June 30,1989 as planned. 99% of the funds were disbursed by the end of FY87 and thelast disbursement was made on January 20, 1989.

The PCR was jointly prepared by the Infrastructure Division,Country Oper .ions I of the EMENA Regional Office (Preface, EvaluationSummary, Parcs I arn III), and the Borrower (Part II)--because of the lengthof this document, it was condensed without changing its substance, while thefull text can be found in the project files.

Preparation of this PCR was started during the Bank's finalsupervision mission of the project, and is based, inter alia, on thePresident's Report, Loan and Project Agreements, supervision reports,correspondence files, internal Bank memoranda, and extensive interviews withkey staff and management.

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PROJECT COMPLETION REPORT

TURKEYCUKUROVA REGION URBAN ENGINEERING PROJECT

(Loan 2537-TU)

EVALUATION SUMMARY

INTRODUCTION PND BACKGROUND

I. The economic setting against which the Cukurova Region UrbanEngineering Project (CUEP) was identified is discussed in the April 18, 1985President's Report (PR, paras 4-25). The most salient development in theurban sector was the Government's decentralization policy, adopted in 1984(PR, paras 37-38). The Government's main objectives were to decentralizerespcnsibility for urban planning and certain services to municipalities,improve the management of local administrations, provide adequateinfrastructure and services, and reduce housing shortages. Municipal revenueshad been growing rapidly since 1980. Support for the Government'sdecentralization policy was the underlying rationale for the CUEP.

II. When CUEP was appraised in November 1984, the Bank had experiencewith two differing approaches to urban investment and institutional reform inTurkey. Both single sector and integrated urban approaches had been attemptedin parallel operations during 1972 with the Istanbul Water Supply Project (LN844-TU) and the Istanbul Urban Development Project (CR 324-TU). Although theintegrated approach was generally acknowledged as unsuccessful in Istanbulwhile the operation in the water sector led to institutional innovation andfurther investment, the merits of these two approaches were still acontentious issue at the time the Cukurova project was proposed (para 1.01,9.01). The Bank and the Government hoped to overcome the risks encountered inthe first urban loan through more thorough preparation utilizing heavyexternal input financed with an engineering loan.

OBJECTIVES

III. Intended: The CUEP obiectives were first, to identify and designinvestments for five municipalities in the Cukurova region which couldsubsequently be financed under a follow-on Bank loan; and second, to developcomplementary policies and national, regional, and local institutionalmechanisms to support decentralization, achieve integrated regional and urbanplanning, and improve urban efficiency. Achieved: CUEP was an innovativeconcept, but subject to a high degree of risk due to its complexity and

ambitious institutional objectives. It required the active collaboration of alarge number of disparate government entities (31), sometimes with competing

- iii

interests and. jurisdictions (para 4.02a). Although CUEP did result inappraisal and subsequent approval of a follow-on Bank investment, the CukurovaRegion Urban Development Project (CUDP LN2819-TU), many of the objectives forspecific components and institutional reforms were not achieved.

IMPLEMENTATION EXPERIENCE

IV. Implementation experience with CUEP components is summarized belowi

a) To review experience and make recommendations on appropriateregional develoRment obicctives and organizationalarrangements. Since the Government lost interest inestablishing a regional planning authority, thecomprehensive analysis was not completed (para 5.02, 14.01).

b) To design urban investments and suitable institutional andfinancial arrangements to sustain them in water supply andsewerage, solid waste management and composting, upgrading"Gecekondu" or informal housing sites, development of urbanexpansion areas (UEAs) and other possible urban investmentsincluding wholesale markets and transport facilities. Finaldesigns and tender documents were produced for 11 municipalinvestments during CUEP. Because of the increasing scale andcomplexity of CUEP, design work was deferred to CUDP forsome comiponents including Gecekondu Upgrading and HousingManagement Areas (paras 5.01, 14.03). Of the investmentsfor which final designs were completed, two were ofq1uestionable value because they lacked commitment by themunicipalityy and two had to be dropped from CUDP due toevents which compromised their viability.Y Institutionalobjectives necessary to support investments and improveurban efficiency incl-ded the development of localgovernment reorganization Rlans and the establishment ofautonomous Housing and Urban DeveloRment Comnanies (HUDCs)in each municipality to provide infrastructure and marketserviced sites in Urban Expansion Areas (UEAs). Municipalreorganization plans were developed during CUEP and approvedby municipalities, but they were not approved by theGovernment (paras 5.03, 14.05). HUDCs were established infour municipalities, but did not generally fulfill theirintended role (paras. 5.04, 14.02).

Ceyhan sanitary landfill, Ceyhan Sewerage and Drainage (para. 5.02).

V Adana Se-werage (para 5.02) and Adana Urban Expansion Area (para5.04).

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c) To identify. recommend. and assist in imRlementingimprovements in municipal accounting and financialmanagement. New accounting standards were designed, butwere not approved by the Government during CUEP (paras 5.03,14.06).

d) To develoR programs of local government staff training. Aregional training institution, the Cukurova Municipalities'Training Association (CMTA), was established by decree, butthe objectives and scope were overly ambitious and not fullyembraced by municipalities (paras 5.03, 14.08).

e) To advance completion of the regional and national cadastralsurveys. Equipment was purchased for the regional cadastraloffice, but the national cadastral component was droppedfrom CUDP when a feasibility study completed during CUEPindicated it was too ambitious (paras 5.02, 14.09).

f) To prepare sDecial studies on the role of Iller Bank and theAdana Transportation system. The study on Iller Bank wascompleted, but was unsatisfactory and no agreemont wasreached with the Government on a reform program (paras 4.06-07, 5.03, 14.10). The Adana transport component wasexpanded and transport studies were carried out for eachmunicipality, but this component was dropped after appraisalof CUDP in an attempt to reduce project complexity (paras5.02, 14.11).

V. The borrower complied with covenants. The final audit has not yetbeen submitted (para 10.0)

RESULTS

VI. The estimated cost of CUEP was US$10.71 million of which US$6.05million equivalent were local costs. IBRD financed US$9.2 million or 85% ofthe total appraised cost. The actual project cost was US$13.2 million (Table5A). Planned Droject comrletion was December 31, 1988 (Table 2). ActualRroject comRletion was in October 1987. The loan closed on June 30, 1989.

v

SUSTAINABILITY

VII. The issue of CUEP sustainability can be addressed more meaningfullyin the Project Completion Report for CUDP, but results of CUDP to date havenot been encouraging. Civil dorks have not progressed, municipal finance andorganizational improvements have not materialized, and project managemer.t byIller Bank has not been effective. After 2 1/2 years since loaneffectiveness, about 1X of the loan has been disbursed. The Government andthe Bank concluded recently that the original design and objectives of CUDPare not viable and have agreed on the need to restructure the project byreducing its size and scope and changing the project execution arrangements.

FINDINGS AND LESSONS

VIII. The PCR indicates that several specific aspects of the CUEP designand organizational framework hampered results of both CUEP and subsequently ofCUDP. First, the project design was too complex, with five municipalities, alarge array of investments, and institutional innovations at the national,regional, and local level (para 3.02a). Second, the increasing scope andscale of CUEP over time detracted from project preparation efforts (pora3.02b). Third, the Project Coordination Unit (PCU) was not sufficientlyaccountable to project entities, contributing to these entities' weakcommitment to CUEP objectives (para 3.02c). Fourth, the lack of personnel andinstitutional continuity between CUEP and CUDP had a negative impact on theproject (para 3.02d). Fifth, CUEP did not result in an agreed reform programfor Iller Bank prior to its appointment as executing agency for CUDP resultingin an inconsistency between the project objectives and that of the institutionexpected to implement them (para 3.02e). Finally, Bank analysis andconclusions presented in Part I of the PCR differ in spirit and substance fromthe Borrower prepared PCR summarized in Part II of this report. While theBank's assessment is that the project was beset with problems, the Borrower'sconclusions would suggest that either there were no problems or that if therewere, they were quickly resolved.

Several lessons may be considered for future operations:

(a) Bank support for municipal strengthening is appropriate inTurkey, but the single-sector project approach (eg. watersupply and sanitation) has been more effective than theintegrated urban approach in furthering this importantobjective. A phased approach to municipal development aimedat one sector limits the number of institutional contactpoints, thereby simplifying the tasks of coordination andconsensus-building, and is better tailored to the currentimplementation capacity of municipalities in Turkey, whichlack the experience, financial systems, or personnelrequired to implement complex multi-sectoral projects withcomplicated financing and cost recovery mechanisms.Integrated urban projects also imply a heavy commitment ofBank resources for supervision, a factor which should betaken into account when budgeting resources for suchoperations.

- vi -

(b) For urban projects to succeed, strong government commitmentat the central and local level and coordination between thetwo are necessary. In order to engender project "ownership"and sustained commitment to objectives, entities which areto be affected by planned institutional reforms orinvestments should be fully involved in the formulation ofsuch pl.,ns. The Bank should have devoted more attention todiscussion of the cor-lusions of important studies preparedduring CUEP at appros iate levels with the entities thatwere to be affected to ensure that recommendations wereunderstood xnd consenrus reached. Some staff working onCUEP have noted that language constrained staff/consultanteffectiveness in this area.

(c) Institutional continuity between project preparation (eg.CUEP) and implementation (eg. CUDP) is highly desirable.For very complex projects, it may be advisable to use thesame consultants for engineering and technical supervisionof engineering.

(d) Like other Bank investments in Turkey, engineering loansshould encourage the Government to finance local costs tothe extent possible and share at least a portion of thosecosts with final beneficiaries. Some cost sharing withmunicipalities during CUEP combined with mechanisms toensure their effective input into the preparation processmay have prompted cancellation or revision of certaincomponents or withdrawal by some municipalities, but itwould also have encouraged preparation of a demand-drivenproject in which participants demonstrated commitment toobjectives.

PROJECT COMPLETION REPORT

TURKEYCUKUROVA REGION URBAN ENGINEERING PROJECT

(LOAN 2537-TU)

PART I: PROJECT REVIEW FROM THE BAN1ZIZS PERSPECTIVE

Project identity

-Project Name: Cukurova Region Urban Engineering Project

-Loan Number: LN-2537-TU

-RVP Unit: EMIIN

-Country: Turkey

-Sector/Subsector: Infrastructure/Urban

1. Background. Sector Development Objectives. and Policy Context

1.01 When CUEP was appraised in November 1984, the Bank had experiencewith two differing approaches to urban investment and institutional reform inTurkey. Both single sector and integrated urban approaches had been attemptedin parallel operations during 1972 with the Istanbul Water Supply Project (LN844-TU) and the Istanbul Urban Development Project (CR 324-TU). According tothe 1983 Audit Performance Report (4872-TU) for the Istanbul Urban DevelopmentProject (CR 324-TU), the Bank's goals were in the abstract appropriate, butthe project was overly ambitious, lacked sustained government support,suffered from poor coordination, failed to achieve integrated metropolitanplanning, and resulted in no investments. Although the Istanbul Water SupplyProject was delayed due to institutional and firnancial constraints, it waseventually implemented, contributed to institutional development in theestablishment of the Istanbul Water and Sewerage Authority as an autonomousentity, and by 1982, led to a second project (Istanbul Sewerage; LN 2159-TU).The merits of these two approaches were, however, still a contentious issue atthe time the Cukurova project was proposed (para 9.01).

1.02 Interest in a second integrated urban loan to Turkey coincided withthe completion of the Bank's Urban Sector Review (4631-TU) in 1983. The mostsalient development in the urban sector at that time was the Government'sdecentralization policy (President's Report, paras 37-38). Municipal revenueshad been growing since 1980. The Government's objectives, articulated in1984, were to devolve responsibility for urban planning and certain servicesto municinalities, improve the management of local administrations, provideadequate infrastructure and services, and reduce housing shortages. CUEP wasconceived as an innovative response to the need to strengthen localgovernments' capabilities to respond to these new challenges and reshape thesupporting role of central government institutions such as Iller Bank. Theconcept for the Cukurova project was presented to the Government during thediscussions of the Urban Sector Review, which provided the conceptualframework and institutional objectives. Although the Urban Sector Reviewitself raised many fundamental policy issues for the Government to consider

and Vhitch subsequently were incorporated into CUEP (e.g., reform of Iller

Bank), these issues may not have recei':.-d the attention they deserved as

participants preferred to focus on identifying possible iivestments.

1.03 The Bank and the Governmenlt were cognizant of the failure of the

IstanbuAl Integrated Urban Development (p4ra 1.01), ano hopvd to limit the

risks of a second fajlure through more thorough preparation, Because the

requirements for preparing the Cukurova project were expected to exce6d the

resources available through the Bank's Project Prvaparation Facility (PPF)

which had already been tapped, the Government requested an engineering loan to

prepare a pilot inv2stment project for five municipalities (Adana, Mersin,

Iskenderun, Tarsus, Ceyhan) in November 1984. The Cukurova region was

selected as a pilot area because of its rapid urban population growth and

munici-al service deficiencies. b'

2. Project Obectives ad DescrintioD:

2.01 CUEP was a project preparation loan. Its objActives were first, to

identify and design investments for financing under the follow-on Cukurova

Region Urban Development Project (CUDP; LN2819-TU) and second, to develop

complementary policies and national, regional, and local institutional

mechanisms co szopport decenitralization, integrated planning, and improved

urban efficiency. The total planned cost of CUEP was US510.7 million. 90% of

project costs were budgeted for consultants to manage preparation activities

and carry out institutional, feasibility, and design work. Components

included waser suply and qgverage, solid waste ntanagem=r., urban grangport

upgrading infrastructure and services in infgrmal hgu_s5in aga (i.e.,

Gec.ekondus), design of on- and off-site infrastructure for Urbar_Exngnsion

Areas (UAEs) and establishment of municip4l Housing and Urban Development

Companies (HUDCs) to market serviced land in these areas.

2.02 In addition to the municipal infrastructure and relatedinstitutional components such as creating separate water authorities within

municipalities, CUE? aimed to develop e ztion plans for_local

wove.rnment, design and implement new un-ictal aceoLnrinp: stAndards and

eatablish a new r-egionalRlanain authority. Funds were also budgeted for

staff training, technical assistance and equipment for the national and

regional cad&stral programs V, and a study to examine the role of 111 .Bank.

Population in the five major municipalities increased 6.2% p.a. from

1980-85 and over half lived in unplanned gecekondu settlements in 1985.

Half of the total area of 2000 ha. wias to be developed for low income

families.

The objectives of the regional cadastral component were ti advance

survey completion from 15 to 3 years including mapping 25,000 km2,

title registration in 2,300 km2 villages, and surveys of 68,000 plots

in municipalities.

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While CUEP was expected to result in new infrastructure and managerialimprovements for five municipalities in the Cukurova region, the Bank'sunderlying justification for CUEP was considerably more ambitious. Theunderlying objective was to establish a technical, managerial, and financialbasis for implementing national decertralization policies.

3. Proiect Design and Organization

3.01 The State Planning Organization (SPO) was executing agency for CUEP.It established a Project Coordination Unit (PCU) staffed by consultants inAdana to oversee the three phases of work, including; phase I (4 mos.), forsub-project identification and pre-feasibility studies; phase II (8 mos.) forfeasibility studies; and phase III (7 mos.) for detailed engineering andpreparation of tender documents. Institutional reforms such as establishingHUDCs, new municipal accounting systems and municipal reorganization planswere to be initiated during CUEP while the study on Iller Bank would set thestage for reforms to be implemented under the follow-on loan.

3.02 Several specific aspects of the CUEP design and organizationhampered results:

(a) The CUEP design was too complex. The project design combined fivemunicipalities, a large array of investments, regional planning,and institutional innovations at the national, regional, andmunicipal level. In order to achieve its obiectives, CUEPrequired the active collaboration of a large number of disparategovernment entities (31), sometimes with competing interests andjurisdictions.y It envisioned financial input for CUDP fromseveral different sources on varying termsV and adoption of sevendistinct cost recovery/financing instruments.Y This panoply ofimplementation entities with varying financing sources and costrecovery mechanisms wece too difficult for the Government ormunicipalities to manage (Table 9). The wide scope of the projectalso led to fragmentation of responsibility and authority, hencedifficulty in coordination. The PCU in Adana, staffed exclusively

V' In addition to five municipalities, their Water and SanitationCorporations (WSCs or ASKI in Adana), Housing and Urban DevelopmentCompanies [4] and the Cukurova Municipalities Training Association(CMTA), 16 central government entities were involved. See para 14.12for a listing.

11 World Bank, Development Support Fund, Municipalities (5], Iller Bank.The Central Government, Posts and Telecommunications Authority (PTT) andTurkish Electricity Authority (TEK) were to provide some complementaryfacilities/infrastructure in Urban Expansion Areas.

Municipal Taxes, land prices for UAEs, Improvement Levies, tariffs andcharges, Iller Bank income, Legalization charges, Central GovernmentBudget.

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by consultants, had the responsibility for ensuring the activecollaboration of all entities, yet it lacked authority necessaryto achieve this objective. Municipalities also lacked experiencein planning and implementing their own investments and were unableto assimilate such an ambitious and multi-sectoral institutionalreform program in the timeframe that was envisioned.V

(b) The large scale of the investment program detracted from thepreDaration of CUDP. The size of the CUDP investment programdoubled during CUEP from the original US$211 million investmentprogram that consultants recommended as feasible and affordable bymunicipalities at the end of phase I to US$420 million (para 4.02-03). This expansion and increasing demands for consultant reportsto support the complex operation detracted from the results ofpreparation, thus many components remained incomplete or at arelatively early stage of preparation despite intensive consultantinput. Several factors affected the desire for a large project.Bank staff working on the project mention that it was felt that alarge project (approximately US$500 million) would be needed tocapture the attention of policy makers thereby enhancing theprospects of replication. The limited number of operations inTurkey in a given year and inability to finance local costs mayalso have played a role in determining project size.

(c) The PCU was not sufficiently accountable to Rroiect entities.contributing to their weak commitment to objectives. To ensurethe participation of all agencies concerned, national and regionalproject Steering Committees were to be formed according to theloan agreement for CUEP, however, these committees did notfunction effectively. The PCU developed investment plans andreform packages affecting municipalities and key governmentagencies such as Iller Bank and the Ministry of Interior, but withinsufficient input from, or accountability to their leadership.The failure of the PCU to build a consensus for the program theyrecommended strained relations with these entities. Theopposition to CUEP which developed within the Iller Bank and theMinistry of Interior reflected to some extent differences on thescope and pace of decentralization, a policy spearheaded by SP0and the underlying rationale for CUEP.

(d) Lack of personnel and institutional continuity between CUEP andCUDP had a negative impact on the project obiectives. Prematuredemobilization of the PCU and departure of all its staff,selection of new consultants to assist the new Project Review andImplementation Unit (PRIMU) established in Iller Bank to executeCUDP, leadership changes in SP0 and Iller Bank, and reassignment

The Government's decentralization policy was still in its infancy whenCUEP was designed. Iller Bank had been responsible for financing andexecuting most infrastructure investment on behalf of municipalities inthe past.

of all Bank staff that had been involved in CUEP during the Bank'sreorganization led to a loss of momentum and control during thecritical transition period from CUEP to CUDP. (para 4.09) Mostimportantly, control over CUDP was trarsfer-e. ̂rom SPO to IllerBank, an agency with conflicting purposes an, Known antipathytoward the project objectives.

(e) CUEP did not result in an agreement on reform of Iller Bank. Fromthe inception of CUEP, it was clear that Iller Bank was the keyinstitution which could be used to support and strengthen theGo-ernment's commitment to decentralization. It was also clear,however, that the CUEP concept of municipalities taking controlover the planning, design, and implementation of their own publicworks from Iller Bank while shifting Iller Bank into position as afinancial intermediary was antithetic to Tller Bank's traditionalobjectives, which included retaining central control over publicworks engineering and implementation while keeping municipalitiesdependent on its subsidized finance. The basic inconsistencybetween the project objectives and those of Iller Bank was widelyrecognized, but the Bank's strategy was te carry out a study ofIller Bank's functions and management during CUEP and hope thatduring project preparation there would be a political opening toinitiate the reform process. This strategy was unsuccessful forseveral reasons; first, the CUEP study on Iller Bank was inferiorand poorly received by Iller Bank management; second, the PCU didnot involve Iller Bank sufficiently in CUEP; and third, theGovernment did not firmly commit itself to a reform program in theface of strong opposition from Iller Bank.

4. Proiect Implementation

4.01 Loan Effectiveness and Proiect Start-Up. Eight months elapsed betweenthe Government request for an engineering loan in November 1984 and CUEPeffectiveness. US$600,000 from the Project Preparation Facility was providedin the interim to cover expenses and later refinanced. SP0 selected a localconsulting firm in late 1984 to provide the administrative framework for the PCU.The PCU staff were, however, selected by the SPO and engaged by the consultingfirnm at their behest. The consultant's contract was effective in February 1985and was expected to be completed in December 1987 -- a period of 35 months. ThePCU then selected a joint venture consulting firm to identify subprojects,undertake feasibility and institutional studies, prepare final designs and tenderdocuments for municipal investments. The joint venture consultant team mobilizedin April 1985, but the contract was not signed until July 12, 1985. CUEPimplementation was thus underway before CUEP was declared effective on July 24.1985.

4.02 ImDlementation: Phase I. The joint venture consultants during PhaseI identified subprojects, completed 16 working papers and pre-feasibilitystudies on municipal finance, regional development, water supply, sewerage,solid waste, electricity and telecommunications, gecekondu upgrading, urbanexpansion areas, and prepared 8 Terms of Reference for major studies on IllerBank, household surveys, orthophoto mapping, housing finance, and national

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cadastral surveys. (See Table 7 of Part III for list of consultant output foreach phase.) Based on this preliminary investigation and affordabilityestimates, they recommended to the PCU an investment program of about USS211million equivalent (1985 prices) over the period 1986-90. Phase I wascompleted in August 1985, shortly after the date of effectiveness for CUEP.

4.03 Phase II: The scope of work agreed in October 1985 for phase II wasexpanded beyond what was envisaged in the original terms of reference for theconsultants. This was due to requirements for additional studies, a decisionto accelerate preparation of tender documents for on- and off-siteinfrastructure for three UAEs from phase III to phase II, the decision toimplement accounting and organizational reforms in several municipalitiesduring Phase II, and most importantly, the increasing scale and complexity ofthe investment program. The joint venture consultants were requested tocontinue to identify and prepare sub-projects up to a maximum of USS420million. Despite the increase in the scope of work which occurred duringPhase II, the time frame for completion of CUEP was not extended resulting inan expansion of man-month requirements and an increase in the scale andcomplexity of the operation.12

4.04 Phase II was completed as planned in May 1986 (8 months). Theconsultants produced 70 studies on a broad range of issues and investments(Table 7) including housing, municipal finance, institutional development andtown-specific feasibility studies on water, sewerage, solid waste, urbanexpansion areas, and housing upgrading. In transport, only the Adana studyhad been envisioned originally, but expansion of the scope of work led to fourseparate town studies for transport. Only feasibility studies were completedfor the UAEs with final design again deferred to Phase III.

4.05 Contract signature for Phase III was delayed by 7 months because theGovernment objected to the consultant's estimated man-month requirements. Theconsultants requested that the Government reduce the number of subprojects fordetailed engineering if the budget was limited, but the PCU insisted onmaintaining the larger size and scope. In agreeing to complete the necessaryinputs for this investment program, the consultants obtained a supplementalcontract for phase III from the Government. This was signed in November 1986to cover additional studies and work requested by the client. The originalcontract for phase III was amended and signed with the consultant jointventure in December 1986. The Bank had appraised CUDP in November 1986 withtotal costs estimated at US$467 million.

4.06 During this same period (November 1986), the management study ofIller Bank carried out during phase II was completed by one of the jointventure partners. This study had a negative impact on the future of CUEP andthe follow-on CUDP investment, for which Iller Bank was made the executing

MM/ The consultant's contract covered all three phases, but only phase Iwas a lump sum amount. The firm negotiated unit costs for theremaining phases since the scope of work was to be defined during thefirst phase. Man-month requirements were then submitted and negotiatedprior the each subsequent phase.

agency. Consultants recommended a rapid and fundamental transformation ofIller Bank from a public works agency under the Ministry of Public Works andSettlement (MPWS) to a commercially-run financial intermediary within thebanking system. Although this generdl concept had some support within theGovernment, Iller Bank management strongly resisted any attempt to reduce itstraditional role in engineering services and construction supervision. IllerBank management felt threatened by consultants' sweeping recommendationsincluding restructuring its Board of Directors and governing General Assembly,reducing technical service staff from 600 to 200, and phasing out subsidies.Although the Bank also wished to see Iller Bank begin to function more like afinancial intermediary for municipalities, staff doubted whether it was wiseor feasible to attempt to implement all of the report's proposals in the shorttime envisioned and felt that the report diagnosed only Iller Bank'sweaknesses, neglecting strengths which could be capitalized on in building theinstitution. Unfortunately, consultants rejected the Bank's suggestion thatpriorities and more limited reform objectives be established for Iller Bank.

4.07 The drastic reform of Iller Bank proposed by consultants may be seenin retrospect to have severely reduced the possibility for CUEP or Bank staffto work in a collaborative manner with Iller Bank management to strengthen theinstitution along lines acceptable to its management. Consultant failed tobuild a consensus for their recommendations within Iller Bank. Theirexpectation that the Government would be able to force rapid reform on IllerBank was a tactical misjudgment with high costs for CUDP, for which Iller Bankbecame the executing agency (para 4.09). The study on Iller Bank required 14man-months of consultant services compared to the 45 estimated at appraisaland the team completed the study in only three months. Given the criticalnature of the Iller Bank study to project success, greater resources and long-term attention should have been devoted to it during preparation.

4.08 Phase III: During Phase III, about 60 studies were completed and 11subprojects prepared to tender stage. Phase III was completed in July 1987 inline with the original 7 month work estimate, but 6 months late due to theprotracted contract negotiations (para 4.05). The three phases togetherconsumed a total of 27 months of actual calendar work time by consultants, 42%more than the 19 months Enticipated at appraisal. The appraisal estimate ofconsultant input requireA to complete CUEP was 109 staff years. Theconsultant joint venture billed the client for 172 staff years for the threephases as a result of escalation in work program and man-months agreed toduring phases II and III. The consultant's own estimates indicate that theyprovided 205 staff years to complete the work, but the client was not billedfor this higher amount since man-month requirements were fixed at the start ofeach phase. In addition to joint venture consultant's services, consultantinput for the. PCU was estimated at 33 staff years at appraisal.

4.09 After completing CUEP, the Bank expected the PCU in Adana to continueto operate under SPO and be responsible for overall project administration ofCUDP. This arrangement was to ensure continuity between the two operations.Since SPO is primarily a planning agency, it reduced PCU operations followingthe negotiations for CUDP in April 1987 and closed the office in October 1987when full implementation responsibility was transferred to Iller Bank. IllerBank's management was relu ant to take on responsibility for CUDP because of

disagreements over key project ob4ectives, including its own reform, butaccepted the Government's decision. Since neither Iller Bank nor their newconsultants had been directly involved in CUEP, they were not well prepared totake over the complex operation, even if Iller Bank management had beenmotivated to do so.111 Iller Bank initially appointed weak management to theProject Review and Implementation Unit (PRIMU) it established to implementCUDP. The lapse in effective and committed project management resulted in aloss of control over key project activities (e.g., HUDCs). The actions of twomunicipalities, Adana and Ceyhan, also contributed significantly to the lossof momentum during the transition period between CUEP and CUDP. Both hadgrown disenchanted with CUEP and felt that as a result of the financing planwhich passed on the foreign exchange risk of borrowing under CUDP tomunicipalities and a perceived attempt by the project to curtail theavailability of subsidized finance from Iller Bank, participation in CUDPcould prove to be too "expensive". The Mayors of Adana and Ceyhan consideredwithdrawing from the project on different occasions including at thenegotiations for CUDP. IV Although they eventually decided to participate,both municipalities delayed signing onlending agreements thereby delaying CUDPeffectiveness for all municipalities by six months (until January 1988).

4.10 Procurement: Consultants for the project and equipment were procuredaccording to Bank guidelines. A local firm with government equity participationwas engaged by SPO under sole source arrangements to house the PCU. Theconsulting joint venture hired by the PCU to carry out identification,feasibility, and design work was selected from a shortlist. The main jointventure partner was given a separate sole source contract to carry out thetransport and cadastral studies while the other foreign partner was hired undersole source arrangements for the Iller Bank study. All equipment for CUEP wasprocured under LCB since individual packages were not expected to exceedUS$250,000 equivalent or local shopping for smaller items. Invitations to bidfor cadastral equipment and the transfer of procured items were delayed becauseSPO had to procure on behalf of the National Cadastral Office.

4.11 Proiect Costs: The estimated cost of CUEP at appraisal was US$10.71million. The final cost estimate was US$ 13.2 million (23% overrun; seeTables 4 and 5A). IBRD financed US$9.2 million while SPO covered the balance.The major cost overrun was for feasibility, institutional, and design studies

Consultants and staff for the new Iller Bank Project ImplementationUnit (PRIMU) in Adana had still not been fully mobilized by April 1988,though CUDP became effective January 1988. (Table 2)

12. All mayors attended negotiations for CUDP in Washington during April1987. After their return; the Municipal Assemblies of Adana andCeyhan, which together were to receive 46% of the Bank loan, voted towithdraw from CUDP. These decisions were reversed in October (Ceyhan)and November (Adana) 1987 when both municipalities agreed toparticipate.

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and special studies. Appraisal estimates for these items were US$7.6 millioncompared to actual costs of US$11.14 million paid to the main consulting jointventure or its partners individually.

4.12 Disbursements and Loan Allocation: The Bank financed 85% of CUEP'sestimated US$10.71 million costs though US$6.05 million equivalent wereestimated as local costs. There were no significant deviations from appraisalestimates of the disbursement schedule. The last disbursement was made onJanuary 20, 1989 and the loan closed on June 30, 1989 as anticipated. (Tables2 and 3)

5. Project Results.

5.01 Consultants produced final designs and tender documents for 11municipal investments including on- and off-site infrastructure for UAEs(Adana, Tarsus, Mersin), water and sewerage infrastructure (Adana, Iskenderun,Ceyhan, Tarsus), and sanitary landfills (Iskenderun, Ceyhan). (Table 5)Because of the increasing scale and complexity of CUEP, consultants had todefer work on a number of key components to CUDP, which thus remained at anearly stage of preparation. Feasibility studies were completed for gecekonduupgrading and housing management components, but no final designs. Theseunfinished tasks were to be passed on to the new Upgrading Units which were tobe established in each municipality as part of the master plan for municipalreorganization. Unfortunately, the reorganization itself was never approvedthus progress on these two components was halted (para 5.03).

5.02 Several components or investments were reduced in scope or eliminatedduring CUEP. The objectives of the regional urban growth management componentwere revised when the Government lost interest in establishing the proposednew regional planning authority and adequate consultant resources could not beallocated due to the increasing scope and complexity of preparation efforts atthe municipal level (para 14.01). The national cadastral component wasdropped when a pre-feasibility study indicated that the task was overlyambitious (14.09). Feasibility studies were completed for transportationimprovements for four municipalities, but this component was deleted from CUDP

in an attempt to simplify it (para 14.11). A serious problem was theunwillingness of Iller Bank to share information with the PCU on its ongoingor planned investments in the project municipalities (para 14.04) The finaldesigns for Adana Trunk Sewers were rendered useless by a competing designthat Iller Bank had simultaneously prepared during CUEP and offered to financeon concessional terms. Despite agreement with the Adana municipality on thelocation of a proposed sanitary landfill and completion of preliminarydesigns, the municipality used the land for another purpose (14.04). Ceyhandisagreed with the CUEP final designs for investments in a Sanitary Landfilland Sewerage and Drainage system (para 14.04).

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5.03 Results of CUEP's major institutional objectives were disappointing.The study on the role and function of Iller Bank resulted in no consensus oragreed reform program during CUEP.13 Given the strong opposition of IllerBank to any fundamental changes in its operations, the Bank lowered its targetfrom reforming Iller Bank to that of establishing a Project Review andImplementation Unit (PRIMU) within the institution which would test itsability to function as a financial intermediary for the Cukurova region.Unfortunately, by appointing weak management and insufficient staff to thePRIMU after CUDP negotiations and not giving PRIMU authority over all IllerBank-financed works in the Cukurova municipalities as envisioned under CUEP,Iller Bank undermined the effectiveness of PRIMU. The objective ofimplementing a new municipal accounting system on a pilot basis was also notachieved because the new system that was designed under CUEP was not approvedfor implementation. Three municipalities that implemented portions of the newaccounting system during CUEP in parallel with their traditional system weresubsequently forced to revert to the old system on instructions from theMinistry of Interior (MOI) thus incurring unnecessary costs and contributingto municipalities' disenchantment with the project (para 14.06). Municipalstaff that had been trained in the new accounting standards were eventuallymoved to other positions.W/ The credibility of CUEP with municipalities wasfurther eroded when the Government failed to approve the local governmentreorganization Rlans designed under the project after their approval bymunicipal assemblies, a factor which had negative repercussions for severalcomponents, particularly upgrading and financial management. Like theaccounting reforms, municipalities such as Iskenderun that began to reorganizewithout MOI or State Personnel Directorate (SPD) final approval incurredunnecessa.ry expense since they were subsequently instructed to dismantle thereforms (para 14.05).i.I The MOI did not clarify the reasons for its failureto approve these key project components. The local government staff trainingcomponent did result in the establishment by decree of Cukurova MuniciRalitiesTraining Association (CMTA), an innovative regional training institute to befinanced and managed by the municipalities, but the objectives and scope of

13/ The SAR for CUDP noted that the Government had agreed duringnegotiations to decide on role and functions of Iller Bank by December 31,1987, without specifying the direction of change or making this a conditionof loan effectiveness. Iller Bank has maintained its strong oppositionto changes in its operations and the Government has not yet made anydecisions regarding this issue.

,LU/ The SAR for CUDP also notes that it was agreed during negotiations thatthe new accounting system would be approved by September 30, 1987, butthis was also not included as a condition of loan effectiveness.

The SAR for CUDP noted that the MOI and Department of Personnel wereexpected to approve the local government reorganization plans designedunder CUEP "shortly", but approval was not granted before CUEP closedand was not made a condition of effectiveness for CUDP.

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CMTA were overly ambitious and the concept was never fully embraced bymunicipal leadership.ie

5.04 Four municipalities established new Housing and Urban DevelopmentCompanies (HUDCs) during CUEP to provide infrastructure and market sites inurban expansion areas (UEAs). Unfortunately, establishing these institutionsproved easier than influencing their growth and development. Although therole of HUDCs was restricted in the Policy Statements agreed to under CUP? toland development and marketing, some began to contract for housingconstruction even before site plans and infrastructure designs were completedthus defeating the objectives of planned development of urban expansion areas(para 14.02). Much of the housing did not adhere to building standards,income criteria, or cost recovery targets established under CUEP (para 14.04).In Adana, the UEA component was dropped from CUDP despite the fact that finaldesigns had been prepared when it became evident that cost recovery andaffordability standards were not being met by its HUDC. Iskenderun was unableto acquire sufficient land for its UEA (para 14.02).

5.05 The institutional and other studies carried out under CUEP increasedthe Bank's knowledge of the sector, but the volume exceeded themunicipalities' absorptive capacity and contributed to their loss of interestin the project. Most reports prepared during the first two phases, thecritical period for building consensus on project objectives, were producedonly in English, with Turkish summaries (Table 5) thus making resultsinaccessible to key municipal staff. The volume of reports and feasibilitystudies is so large (165) that only a relatively small proportion underwentadequate review by local authorities or were discussed at appropriate levelsof the Government. Only a small sample could be reviewed in preparing thisPCR. A large multi-disciplinary Bank team or outside consultants would berequired to review all reports and pass professional judgement on theirquality.

5.06 The financing concept for CUDP developed during CUEP was toocomplicated and did not have the full support or understanding of the IllerBank or the municipalities. In addition to municipalities' owni funds, therewere three major sources of finance for the project including IBRD, IllerBank, and the Development Support Fund (DSF), all with differing terms andconditions.)V IBRD, Iller Bank, and DSF funds were to be channelled throughthe Cukurova Project Account (CPA) to be established within Iller Bank andmanaged by PRIMU. The flow-of-funds and on lending arrangements

MMi Municipalities and WSDs were expected to pay .5% of their revisedbudget expenditures each year to support CMTA. 285 man-months ofconsultant input was to be utilized during CUDP to supplement permanentCMTA staff, which would provide courses for 4800 trainees between 1987-92.

UY In addition, the Government, the Turkish Electricity Authority (TEK),and the Ports and Telecommunications (PTT) were to contribute resourcesseparately to facilities and infrastructure in the UAEs.

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recommended under CUEP for CUDP were also complicated, involving the IBRDSpecial Account (managed by Treasury), the CPA with five municipal accounts(managed by Iller Bank), and municipal sub-accounts for each HUDC. IllerBank's contribution to the project and its non-CUDP investments (ongoing andnew) in each of the municipalities were tc be channelled through the CPA, arequirement designed to prevent recurrences of the situation in Adana seweragewhen Iller Bank used its subsidized resources to compete with a CUEP-designedinvestment (para 5.02). Iller Bank, however, never accepted the principlethat its PRIMU unit should manage all its resource flows to thesemunicipalities. Moreover, there were seven distinct cost-recovery instrumentsapplied to different components including tariffs, tax revenues, land sales,improvement levies, and income on Iller Bank lending. This panoply ofimplementation entities with varying financing sources and cost recoverymechanisms were too difficult for the Government or municipalities to manage(Table 9).

5.07 There were also several problems with the assumptions underlying thefinancing plan for CUDP. Firqt, some municipalities never fully embraced theconcept that they would bear the foreign exchange risk of borrowing underCUDP. Second, the SAR assumptions for CUDP on interest rates and amortizationterms for Iller Bank cofinance were less than the legal rates prevailing atthe time that CUDP was negotiated, a factor which the Bank did not uncover andthat Iller Bank failed to clarify, but which would have affected theaffordability of the investment program which the Bank appraised.MM Third,Iller Bank failed to clarify that it could not legally provide Cukurovamunicipalities with resources at 0% interest from the Municipal Fund, as wasassumed at appraisal of CUDP because these concessional funds were onlyavailable for Iller Bank-designed and tendered works, not investmentsimplemented by municipalities as required under the project.

6. Project Sustainability

6.01 The issue of CUEP sustainability can be addressed more meaningfullyin the Project Completion Report for CUDP, but results of CUDP to date havenot been encouraging. Civil works have not progressed, municipal finance andorganizational improvements have not materialized, and project management byIller Bank has not been effective. 2 1/2 years since loan effectiveness,about 1% of the loan has been disbursed. The Government end the Bankconcluded recently that the original design and objectives of CUDP are notviable and have agreed on the need to restructure the project by reducing itssize and scope and changing the project execution arrangements.

7. Bank Performance

7.01 The Bank correctly diagnosed the critical need to addressdeficiencies in municipal infrastructure and management at a time when highlevel political support for decentralization prevailed. The Bank was,

MMi Iller Bank's interest rate was changed from 16% to 30% on January 1,1987, following the CUDP appraisal in November 1986, but prior to loannegotiations which took place in April 1987.

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however, overly optimistic about the pace at which decentralization couldoccur including the Government's ability to promote institutional objectivessuch as municipal reorganization, new accounting systems, and reform of IllerBank. The Bank also overestimated the capacity of the municipalities toimplement such a complex project. The Bank should also have adjusted theobjectives and scope of CUDP and its administrative arrangements to reflectthe high risks it identified before and during CUEP.

7.02 In reviewing CUDP, the Bank's senior management felt that the projectdesign developed under CUEP was too ambitious and that fewer conponents couldstill provide the desired municipal focus. It recommended excluding the UEAcomponent, since evidence during CUEP indicated that there was no agreement onthe role of HUDCs. The Staff Appraisal Report (SAR) on CUDP also clearlyidentified the serious project risks which had been identified during CUEPincluding the difficulty of making simultaneous improvements in several fieldsin five municipalities, the risk that PRIMU would not be able to fulfill itskey roleSU, and the political risks relating to municipalities' commitment toproject objectives and Central Government commitment to decentralization. TheSAR went so far as to postulate that if the decentralization process slowed,the project might need to be restructured. While these risks were recognized,it was felt on balance that reducing the number of components or the size ofthe project would compromise the operation's urban identity, the scale of theBank loan, or the need for a highly visible operation to increase theprobability of replication. Deleting the UEA component might have jeopardizedsome mayors' interest in CUDP given their strong interest in housinginvestments.

7.03 The Bank may have been reluctant to conclude that CUEI was operatingin an overconstrained environment and therefore reluctant to reassess itsoverall commitment to CUDP because substantial resources had already gone intoproject preparation and SPO continued to support the project. The Bankshould, however, have delayed its approval CUDP until key institutional issuessuch as reform of Iller Bank, municipal reorganization plans, and municipalaccounting changes were fully resolved. Although this was considered, it wasfelt at the time that such a delay would risk the interest of municipalities.If such key institutional objectives were to be deferred from CUEP to CUDP,agreements on these items should have been maintained as conditions of loaneffectiveness for CUDP rather than dated covenants. The Bank should not haveagreed to Iller Bank as executing agency for CUDP in the absence of adequateGovernment oversight and an agreed reform plan for Iller Bank.

7.04 The Bank provided adequate staff resources for CUEP. Supervision bymulti-disciplinary teams was carried out every 3-4 months. 273 staff weekswere expended in moving CUDP to the appraisal stpge, including supervision ofCUEP and inputs attributed to preparation of CUDP (Table 8). Indeed, Bank

2G/ PRIMU weaknesses were to be overcome first, by recruiting professionalson contract terms to supplement Iller Bank; and second, throughintensive Bank supervision and monitoring. Unfortunately, it was notrecognized at the time that Iller Bank is not permitted by law toengage staff on contract terms.

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supervision and involvement during CUEP was so intensive that the borrowerassessed this as a negative factor affecting preparation since considerabletime and effort was necessary to respond to mission requirements (para 14.12).Because the complex operation required large number of studies, Bank attentionduring supervision was often directed toward ensuring that outputs requiredfor appraisal were completed according to the agreed timetable, budget, andquality. This left insufficient time for discussion of the conclusions andrecommendations of studies at appropriate levels with the entities that wereto be affected and reaching necessary agreements on reforms. Some Bank staffworking on CUEP have noted that language constrained effectiveness, and thatof expatriate consultants, in this area.

8. Borrower Performance

8.01 The PCU failed to operate through the regional or national SteeringCommittees which had been established to control CUEP. Its attention was mostoften directed at obtaining the multitude of clearances and central directivesto expedite project preparation. In this process, it managed to satisfy theBank's requirements for appraisal, but it also alienated some projectentities. Although the PCU did not devote sufficient energy during CUEP tothe process of building consensus on CUDP objectives among project entities,it should also be noted that it was not in a strong position to do so giventhat it was staffed entirely by consultants with no permanent institutionalties to any of the project implementing entities and it was over burdened by acomplex project. If the Steering Committees had operated as anticipated, itmay have encouraged greater commitment or "ownership" of CUEP by the projectentities.

8.02 The PCU should have required consultants to revise their study on therole of Iller Bank as suggested by the Bank and should not have continuedpreparation of UEA components while HUDCs were violating agreed PolicyStatements and project objectives. In addition, the PCU should have haltedthe consultants' planning for the Adana sewerage investment after it becameknown that Iller Bank would not collaborate and was preparing a competingdesign. Proceeding to the final design stage despite these unfavorablecircumstances was a waste of resources.

8.03 The Government never approved municipal reorganization plans, newaccounting standards developed during CUEP, or a specific reform plan forIller Bank, thus compromising key institutional objectives. The decision todemobilize the PCU and transfer full responsibility to Iller Bank waspremature, particularly in the absence of an agreed reform program oroversight for Iller Bank itself.

9. Project Relationships

9.01 From its inception, the project design for Cukurova engenderedserious discord, a factor which had a material impact on its results. Seniorleadership in the State Planning Organization (SPO) and Ministry of PublicWorks and Settlement (MPWS) supported the concept of a large, multi-sectoralapproach with ambitious institutional objectives and decentralizedimplementation. The Bank's relationship with SPO, the executing agency for

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CUEP, was very good throughout implementation. The Treasury, however,considered the operation inadvisable. It doubted municipalities'creditworthiness, commitment to cost recovery, and capacity to implement sucha large and complex project given their brief experience withdecentralization. Government disagreement over the project concept wasparalleled by the Bank's internal disagreements. Recalling the earlierfailure with the Istanbul Urban Development Project (para 1.01), somedivisions agreed with the Treasury that the operation would be inadvisable andargued for an incremental or phased approach based on single sectorinvestments 'eg. Water Supply and Sanitation). Ultimately, the Bank and theGovernment agreed to proceed with the operation, but utilizing an engineeringloan (CUEP) which was expected to ensure that the project was thoroughlyprepared thus limiting the risk of another failure.

9.02 The relations during CUEP between the PCU and the leadership of Adanaar_' Ceyhan municipalities as well as between the PCU and Iller Bank werestrained, a situation which led to a lack of cooperation and contributed toweak commitment by these project entities to CUEP objectives.

10. Compliance with Covenants. The Government generally complied withlegal covenants during CUEP including the requirement to establish andmaintain tiie PCU and employ qualified consultants to carry out the project(Table 6). The requirement that national and regional project SteeringCommittees be established may have been complied with from a legal standpoint,but these were committees in an informal sense and did not play thecoordinating/controlling function for which they were intended. Therequirement that the borrower make available to consultants all informationnecessary for successful execution was met except in cases where Iller Bankrefused to provide information on ongoing and planned investments in projectmunicipalities (e.g., Adana sewerage). Final audited accounts have not yetbeen submitted.

11. Consulting Services

11.01 The local consulting firm hired to house the PCU provided notechnical input as such, but served mainly as a channel for hiring staff oncontract rates. A joint venture of consulting firms was hired by the PCU andwas responsible for the major identification, feasibility, and design workunder CUEP. The main joint venture firm admits that not allcomponents/investments that they intended to prepare to the finaldesign/tender stage were completed (e.g., gecekondu upgrading), but theymaintain that their efforts were diluted as a result of the increase in thescope of work and requirements for additional studies. Local partners of thejoint venture assisted through recruitment of local personnel.

11.02 Consideration should have been given to retaining the sameconsultants during CUDP to complete the unfinished engineering and carry outtechnical supervision of the designs it prepared. In such complex projects,the benefits of continuity are likely to be significant. If the consultantslacked the requisite expertise in finance or institutional development to

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assist PRIMU with CUDP, this weakness might have been overcome through ajoint-venture with a management consulting firm or alternatively by separatingthe technical and institutional supervision tasks and hiring two firms.

11.03 Two consultant studies prepared during CUEP contributed tounsatisfactory performance for key components. These studies on the role andfunctions for Iller jank and the design and implementation of the newmunicipal accounting system were overly ambitious in their recommendations andnot sensitive to the need to establish priorities and phase in reforms in amanner acceptable to agencies that they affected. The Consultant'stheoretical conception of a development bank's optimal role in financialintern.ediation was acceptable in the abstract, but not within the realisticconfines of Iller Bank management's capacity or willingness to accept suchdrastic changes over the time frame envisioned.

12. Project Documentation and Data: Project documentation and data wassufficient for the analysis.

13. Findings and Lessons

13.01 The PCR indicates that several specific aspects of the CUEP designand organizational framework hampered results of both CUEP and subsequently ofCUPD. First, the project design was too complex, with five municipalities, alarge array of investments, and institutional innovations at the national,regional, and local level (para 3.02a). Second, the changing and increasingscope and scale of CUEP over time detracted from project preparation efforts(para 3.02b). Third, the Project Coordination Unit (PCU) was not sufficientlyaccountable to project entities, contributing to these entities' weakcommitment to CUEP objectives (para 3.02c). Fourth, the lack of personnel andinstitutional continuity between CUEP and CUDP had a negative impact on the

project (para 3.02d). Fifth, CUEP did not result in an agreed reform programfor Iller Bank prior to its appointment as executing agency for CUDP resultingin an inconsistency between the project objectives and that of the institutionexpected to implement them (para 3.02e). Finally, the analysis andconclusions of Part I of the PCR differ in spirit and substance from theBorrower prepared PCR summarized in Part II. The conclusions of Part Iindicate that the project was beset with problems in design, organization, andimplementation, including contractual arrangements and inter-agency relations.Part II would suggest that either that there were no problems or that if therewere, they were quickly resolved.

Several lessons may be considered for future operations:

(a) Bank support for municipal strengthening is appropriate inTurkey, but the single-sector project approach (eg. watersupply and sanitation) has been more effective than theintegrated urban approach in furthering this importantobjective. A phased approach to municipal development aimedat one sector limits the number of institutional contactpoints, thereby simplifying the tasks of coordination andconsensus-building, and is better tailored to the currentimplementation capacity of municipalities in Turkey, which

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lack the experience, finanlcial systems, or personnelrequired to implement complex multi-sectoral projects withcomplicated financing and cost recovery mechanisms.Integrated urban projects also imply a heavy commitment ofBank resources for supervision, a factor wlich should betaken into account when budgeting resources for suchoperations.

(b) For urban projects to succe'd, strong government commitmentat the central and local level and coordination between thetwo are necessary. In order to engender project "ownership"and sustained commitment to objectives, entities which areto be affected by planned institutional reforms orinvestments should be fully involved in the formulation ofsuch plans. The Bank should have devoted more attention todiscussion of the conclusions of important studies preparedduring CUEP at appropriate levels with the entities thatwere to be affected to ensure that recommendations wereunderstood and consensus reached. Some staff working onCUEP have noted that language constrained staff/consultanteffectiveness in this area.

(c) Institutional continuity between project preparation (eg.CUEP) and implementation (eg. CUDP) is highly desirable.For very complex projects, it may be advisable to use thesame consultants for engineering and technical supervisionof engineering.

(d) Like other B33nk investments in Turkey, engineering loansshould encourage the Government to finance local costs tothe extent po3sible and share at least a portion of thosecosts with ficoal beneficiaries. Some cost sharing withmunicipaliL:ies during CUEP combined with mechanisms toensure their :7ffective input into the preparation processmay have prcmpted cancellation or revision of certaincomponents or withdrawal by some municiralities, but itwould also ha-ve encouraged preparation ,f a demand-drivenproject in wh..sih participants demonstrated commitment toobjectives.

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PROJECT COMPLETION REPORT

TURKEYCUKUROVA REGION URBAN ENGINEERING PROJECT

(LOAN 2537-TU)

PART II: PROJECT REVIEW FROM THE BORROWER'S PERSPECTIVE rU

14. Summary of ImDlementation Results: Implementation results aresummarized for each CUEP component:

14.01 Regional Urban Growth Management. The initial objective of thiscomponent was to advise the Government on the functions, staffing andinstitutional location, responsibilities and authority for a regional planningunit to be established in the Cukurova region. The consultant resourcesnecessary to undertake the detailed analysis required could not be allocateddue to the increasing necessity to focus on the problems at the municipallevel. This component was therefore redesigned to provide a regionalframework for the five project towns and findings were discussed at a workshopheld in Adana during Phase III.

14.02 Urban Exansion Areas (UEAs). The Urban expansion area componentcomprises the development of land with infrastructure and social facilities onapproximately 2,000 hectares of land owned by municipalities for sale todevelopers and individuals for housing, ancillary commercial, and small scaleemployment activities. Municipalities have acquired this land by utilizingfunds amounting to 10.5 billion T.L. lent from the Development Support Fund(DSF) On-site works would be implemented by Housing and Urban DevelopmentCompanies (HUDCs) which have been established in Adana, Mersin, Tarsus andIskenderun. The Structural Plans, Development Plans and Parcelation Layouts ofUrban Expansions Areas of Project municipalities were completed and approvedby the relevant Municipal Assemblies. Except for Iskenderun, which was unableto acquire sufficient land due to insufficient access to credit from the MassHousing Fund (NHF), municipalities completed necessary land acquisition.Premature construction activities, however, particularly in Adana and Mersin,caused deviations from project objectives. In Adana, basic cost recoveryprinciples were ignored and municipal funds were used to subsidize the initialhousing schemes. Serious bottlenecks in Adana also occurred when housingconstruction took place before the arrangements for infrastructure werecomplete. Similarly, Mersin constructed housing before infrastructure planswere complete, but adhered to cost recovery principles. Despite alterationsby Mersin of some infrastructure designs prepared under CUEP, Mersin UEAprogram currently stands as the largest housing project activity in Turkey,largely as a result of CUEP. Tarsus adhered to all CUEP principles andobjectives. There was less progress in Ceyhan due to its delayed

LO/ Part II is a condensed version of the PCU's full report on CUEP, whichit prepared according to the old guidelines for preparation of PCRs.The substance of the Borrower's original document has not been changed.The full version of the Borrower's report is included and is availablein the project files.

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participation in this component and its overall lack of commitment to CUEP.Altogether, over 10,000 housing units affordable to the low income groups(unit costs within the limits of the MHF credits) were constructed duringCUEP.

14.03 Management of Informal Housing Areas. The component involves threemajor sub-components, namely Upgrading, Housing Management and Serviced SiteDevelopment. ZY The upgrading sub-component comprises the rehabilitationand/or installation of infrastructure in informal housing areas which arealready developed to a high density, reparcellation of informally sub-dividedland, and legalization in terms of planning and building legislation throughpreparation and application of Improvement Plans. Services will be providedfor about 144,000 households in the five project towns during CUDP. Thehousing management sub-component involves reparcellation of the informal sub-divisions prior to development so that planned development will take place.The provision of infrastructure will then follow. Housing DevelopmentManagement Areas and Upgrading Areas Strategy represented on town-wide mapswith priorities were adopted by municipalities. Applications for parcellationwere also begun in collaboration with local Cadastral Offices. Over 6,000titles were distributed during the CUEP. With regard to the performance ofindividual municipalities, Iskenderun and Tarsus displayed increasing interestand performance, mainly due to their timely municipal reorganization.Mersin's performance was affected by the absence of technical staff tocoordinate the activities in this component, but did invite proposals forconsultancy services. Adana approved the town-wide program and individualschemes, but did not show the expected performance during CUEP. After itsdecision in November 1987 to actively take part in CUDP, Adana showed anincreasing interest in the upgrading and management programs.

14.04 Municipal Engineering Services. Sub-components included preparationof feasibility and design for municipal water supply, sanitation, solid wastemanagement, drainage, roads and transport and institutional strengthening, thelatter which resulted in shifting of primary responsibility for water andsewerage investments to new Water and Sanitation Corporations (WSCs) in themunicipalities (the Adana Water and Sanitation Authority (ASKI) in the case ofAdana). The main difficulty in engineering studies was to define the projectin relation to ongoing Iller Bank works. Municipalities also seemed reluctantto accept proposed engineering standards. In Adana, the ongoing trunksewerage construction carried out under Iller Bank contract was continued bythe municipality without considering the cheaper alternative proposed by CUEPand despite previous agreement on the location of the sanitary landfill site

?J1 The serviced site development sub-component includes only Ceyhan, wherethere is no informal housing or squatting, and a small site (36 ha,1750 dwelling units) has been acquired by the municipality forservicing and sale to lower income households on a sites-and-servicesbasis. The initial proposals for the Ceyhan project were unaffordable.The component was redesigned and a revised proposal includingpreliminary designs, costs, estimates of financial and economicviability, and proposals for implementation was prepared in December,1986.

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and completion of preliminary designs, it utilized the land for otherpurposes. The Adana HUDC also started construction in the UEA with newdesigns, increasing the standards which had been proposed by CUEP. In Mersin,it was agreed that ongoing Iller Bank construction and the water and sewerageproject proposed under the CUEP would be done in close coordination. TheMersin HUDC, however, also changed designs to start construction in the UEAwith increased standards. In Tarsus, a remarkable level of coordination wasachieved with the municipality and the HUDC with respect to design standards.

The Municipality also stopped ongoing Iller Bank design and tender process fortrunk sewerage with the intention of tendering trunk sewerage constructionwith the designs proposed under CUEP. In Iskenderun, full cooperation inengineering studies was also achieved. There is no ongoing Iller Bank worksin Iskenderun and the municipality is determined to tender water, sewer andsanitary landfill construction with the designs and tender documents preparedunder the Project. Cevhan continues to disagree with the CUEP proposals onthe scope of sewerage construction and sanitary landfills.

14.05 Municipal Reorganization: The main CUEP achievements wereestablishing Housing and Urban development Companies (HUDCs) to develop andmarket UEAs, bringing all water and sanitation activities into the newlyestablished Water and Sanitation Corporatiors in four of the municipalities(ASKI in Adana), and rationalizing municipal departmental structures throughthe establishment of separate units for, inter-alia, (i) investment planning,programming and budgeting; (ii) urban planning and licensing; (iii) Gecekonduupgrading and housing management; (iv) solid waste management; and (v)manpower development. The Reorganization Master Plans prepared for eachmunicipality were accepted by all relevant Municipal Assemblies during PhaseII. Reorganization activities in Phase III included the reorganization ofMersin, Tarsus and Iskenderun. The iob descriptions for key posts in thereorganized departments were prepared and the process of preparingdepartmental regulations covering the structures, functions and operation ofthe project-related departments are under way. Cadre requests for Mersin,Tarsus and Iskenderun were officially submitted to the Ministry of Interiorfor processing in February 1987. The MOI has shown a basic interest inreplicating the reorganization activities elsewhere in Turkey. Mersin hasshown a basic interest in reorganization activities, yet refrained from actualimplementation on the grounds that without the appropriate amendments in theexisting legislation, the legal basis for the new municipal structure wouldnot be justified. Ceyhan, although reluctant to fully participate inreorganization activities, reflected the CUEP proposals in its cadre requestfrom the MOI. Despite the decision by its Municipal Assembly regarding theacceptance of the proposed organization chart, the municipal officials inAdana remain uncooperative on issues pertaining to organizational development.

14.06 Municipal Financial Management. During CUEP, financial status of themunicipalities was assessed in great detail. All assets and liabilities werelisted and revalued. Based on these figures and projections, affordability ofthe investment program to municipalities was evaluated. A new municipalaccounting system was developed and introduced in municipalities except Adanaand Ceyhan. Tarsus and Iskenderun Municipalities have actively participatedin and contributed to municipal finance activities. Mersin also performedwell yet the delay in reorganization activities in Mersin have adversely

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affected the municipal finance activities. Cevhan showed fluctuating interestin activities to improve its financial management. Adana, as a continuationof its lack of interest for developing its institutional and financialcapacity, has not cooperated on this component.

14.07 Computerization: Computer software and hardware needs, staffingrequirements and training needs were assessed for all municipalities exceptAdana and Mersin (Mersin already had a computer system operating properly).Hardware needs of Iskenderun, Ceyhan and Tarsus municipalities were met forthe years 1986-87 from the CUEP budget. Micro-computers for municipalities(except Adana) were purchased by the SPO in 1986 after obtaining three pricequotations and subsequently installed. Computer software developed under theProject includes, inter-alia, (i) "Projcost", which applies the physical andprice contingencies to project costs; (ii) "Income Model", which forecastsfuture income of the municipalities; (iii) "Urban Expansion Model", whichanalyzes and calculates on-site and off-site infrastructure costs for eachdwelling unit, and assesses recoverable and non-recoverable costs in the UEAs;(iv) "HUDC Model", which assesses the financial status of the HUDCs (based onthe Urban Expansion Model); (v) "Munsum", (standing for "municipal Summary"which utilizes other models for carrying out affordability analysis; and (vi)other software developed for analyzing the financial mechanisms of theCukurova Project Fund and the adjusted World Bank model for water andsanitation operations.

14.08 Municipal Staff Training. This has been one of the most successfulcomponents involving the establishment of the Cukurova Municipalities TrainingAssociation (CMTA) to provide specialized training to local government staff,creation of manpower development departments [thus far in Tarsus andIskenderun] and technical assistance to introduce new ftnctions and techniquesto municipalities. All municipalities participated as founding members of theCMTA during Phase II, a remarkable innovation which had positive repercussionsthroughout the local administration in Turkey. The bidding documentspertaining to the engagement of a team of local and expatriate consultants toprovide technical assistance during the start-up phase of CMTA were preparedand approved. The CMTA's initial training program will be based onoperational manuals produced during Phase III of CUEP. Courses are to bedevelo'ed and offered on a continuing basis between 1988 and 1992 to about4500 trainees. The training activities during CUEP were carried out throughcounterpart training and a continuous series of workshops and seminars. Theterms of references for different technical assistance components includingcontract supervision, waste water management, leak detection, roadmaintenance, financial management and institutional development were alsoprepared and finalized.

14.09 Cadastral Program. The regional cadastral component was carried outin close cooperation with the General Directorate of Title and Cadastre (GDTC)and its local offices. The GDTC established a regional directorate to supportCUEP activities. Cadastral application and updating are underway inmunicipalities utilizing equipment procured under CUEP. The SPO issuedinvitation for bids for the cadastral equipment in October 1985. Surveyvehicles, electronic tachometers, drafting and aerial films and main computerterminals terminal control unit were transferred to the Cadastral Office in

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January 1987. The delay in the transfer of equipment occurred because only

SPO had any claims to the Bank loan proceeds thus the GDTC was unable to call

for bids on its own behalf. The remaining cadastral equipment, namely the

data processing and automatic drafting units for which no satisfactory bids

were received, were retendered by the SPO in March 1987 and equipment was

transferred to GDTC in September 1987. The Regional Program is expected to be

completed in 1989. The Ministry of State which controls the National

Cadastral Office suggested that the HAKAR study prepared by TUBITAK would

provide adequate basis for preparing the national cadastral program without

the need to engage consultants under CUEP thus the national cadastral study

was suspended.

14.10 Iller Bank Study. 14 man-months of consultancy services were

provided to carry out a study of Iller Bank. The objectives of the study

were: (i) to review the current role and functions of the Iller Bank; (ii) to

examine the effectiveness of existing Iller Bank operations; (iii) to make

recommendations on the future role, objectives, functions and policies of

Iller Bank in the light of government policies; (iv) to decentralize

responsibility and authority for local services to local governments; (v) to

strengthen urban development; (vi) to explore Iller Bank's potential as the

development bank of municipalities; and (vii) to recommend a phased strategy

for implementing new function and policies, including an Action Plan for

strengthening the management and operation of Iller Bank, and to draft terms

of reference for studies, consultancies and in-house work to formulate details

and to implement those improvements. The Consultant's study on Iller Bank

commenced in March 1986 and Draft Final Reports were submitted in June 1986.

Suggestions and comments of Iller Bank, MPWS, SPO and the World Bank were

incorporated in the Final Report which was submitted in November 1986. The

Study in general was regarded by concerned agencies to be weak in defining the

existing financial status of Iller Bank related to Banking activities which

was also reflected in the proposals for future functions. A major common

concern pertaining to the implementation of the Study's recommendations was

the lack of comprehensive proposals on the transitional stage in Iller Bank's

institutional development.

14.11 Adana Transport Study. Approximately 35 man-months of consultancy

services were provided to carry out a study of transportation systems and

policies of the Project municipalities (except Ceyhan) and to develop a

program to meet their transportation requirements. The consultants commenced

work in May 1986 and was completed the work in September 1986. The

performance of the consultants was remarkable and the Study was carried out

and completed without significant delays. The Urban Transport Planning and

Road Maintenance Study actually comprised two separate studies. In the first

study, emphasis was given to transport-related investments through relevant

feasibility studies. Requirements for new roads and/or major improvements in

existing ones were investigated for the period 1986-1992 in relation to all

factors pertaining to traffic and land use. An investment program for

transport was proposed in four municipalities, encompassing the construction

of 41.6 km. of new roads and the improvement of junctions in main roads. In

the second study, an extensive road maintenance program was developed for the

five municipalities.

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Performance of Proiect Agencies

(a) The Undersecretariat of State Planning Organization of thePrime Ministry (SPO) was the coordinating agency for theCUEP. The Undersecretariat Project Promotion and ResearchGroup (UPPRG), on behalf of the Undersecretary, wasresponsible from all activities of PCU. A ProjectCoordinator, a member of the UPPRG, was the key person inAnkara as far as the contact of PCU with government entitieswas concerned. The Undersecretary of SPO himself was invery close contact with the PCU, personally solving orspeeding up the solution of several potential problemsthrough intragovernmental contacts. All related departmentswithin the SPO, especially Social Planning and EconomicalPlanning departments, provided substantial assistance andsupport to CUEP through the UPPRG.

(b) The Undersecretariat of Treasury and Foreign Trade of thePrime Ministry was the body of the Government communicatingwith the World Bank. The interest of the Treasury in theProject grew substantially after the visit by DeputyUndersecretary to the Project Office in Adana in June 1986.

(c) The Ministry of Interior (MOI) is the responsible for localgovernments. Consequently, the MOI was very much involvedthrough its General Directorate of Local Authorities in thereorganization, training, and accounting system componentsof CUEP. Such crucial and delicate components of theProject were accomplished under the very supportive approachof the MOI. The General Directorate of Security within MOIalso cooperated closely in the planning of the constructionof police stations in the UEAs and Upgrading Areas.

(d) Ministry of Public Works and Settlement (MPWS). Twocomponents of CUEP, namely the UEAs and Upgrading, weredirectly related to MPWS. In order to reflect the pilotcharacter of the project and arrive at meaningful standardsreflecting economic criteria, the MPWS -xempted the projectfrom the by-law on urban land-use planning standards.Further, the MPWS initiated a study to review thesestandards for Turkey. Since Iller Bank is under theresponsibility of the MPWS, several very useful mettingswere held with high level officials of the MPWS on issuespertaining to Iller Bank.

(e) Iller Bank is the major body of the government dealing withurban infrastructure. Iller Bank currently uses standarddesign criteria for water and sewerage networks. CUEP,basing the engineering designs on affordability criteria,introduced a new approach to be implemented on a pilot basisduring CUDP. The actual and potential technical and

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political problems between the project objectives and IllerBank tradition were resolved through the close cooperationamong SPO, MPWS, the General Directorate of Iller Bank, andthe PCU. Integration of ongoing Iller Bank projects withCukurova Project designs was accomplished. Iller Bankestablished the Project Review, Implementation andManagement Unit (PRIMU) to execute CUDP. It is anticipatedthat the positive experience of the CUEP will be passed onto Iller Bank by the pilot operations of PRIMU so that IllerBank can replicate the project results throughout Turkey.

(f) State Hydraulic Works (DSI). Two studies required theinvolvement of State Hydraulic Works. The first study wasMersin Water Treatment Plant. CUEP concluded that doublingplant capacity would be sufficient and could be achieved byincreasing the capacity of filters and changing the filterto favor an increase the capacity of all units. In theAdana Water Supply Project, agreement was reached that CUEPconsultants would work on rehabilitating existing wellfieldsand constructing new wellfields, water reservoirs anddistribution network, and the DSI would concentrate ondevelopment of long term surface water sources.

(g) Post and Telecommunications Authority (PTT). PTT in Ankaraand its Regional Directorate in Adana were extremelycooperative in directing and supervising the designsprepared by CUEP Consultants. The PTT modified some of itsprocedures and standards based on the experience gained inthe Cukurova Project. The initial intention of theGovernment was to propose a contribution from the World Bankfor PTT and TEK investments in the related CUDP components.In due course, however, the Government decided to implementthe components of the PTT and TEK activities with localfunding.

(h) The State Electricity Authority (TEK)/ Cukurova ElectricA.S. (CEAS) Both TEK and CEAS, which has a concession forpower generation and overland transmission in the Cukurovaregion, were involved in CUEP. The UEAs and Upgradingcomponents had to be designed ac-ording their standards.

(i) Thke Directorate of Mass Housing and Public PartnershiRAdministration (commonly referred to as the Mass HousingFund or MHF) was the lending agency to the municipalitiesfor the purchase and/or expropriation of land in the UEAs.The MHF was very supportive of the CUEP concept ofestablishing HUDC's. During CUEP, the MHF started to placemore emphasis on the development of land with infrastructureaffordable to the low income groups. Certain adjustments inMHF regulations were made to reflect this trend.

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(j) Mapping General Headquarters of Turkish Armed Forces (MCH).MGH produced ortho-photo maps of four municipalities, thefirst civilian use of orthophoto mapping in Turkey and whichstimulated other agencies to utilize such technology (e.g.,Istanbul metropolitan Municipality). In March 1987, CUEPrecommendations were considered in amending the related by-law concerning private sector involvement in the field ofair photography to enable the private sector to produce airphotographs larger than 1:5000 scale, suitable for urbanplanning and engineering designs.

(k) Ministry of Education (MOE). CUEP developed several newdesigns for educational facilities in UEAs and UpgradingAreas. These were approved by MOE, although it is inclinedtoward standard designs for Turkey. The MOE's investmentprograms for the coming years were also revised toincorporate Cukurova project activities. Educationalcomponents in CUDP will be funded by local sources. (1) TheMinistry of Health (MOH) was involved in CUEP since healthcenters are an integral part of the social infrastructure inUEAs and Upgrading Areas. The MOH was supportive of CUEPand revised its investment program to incorporate Cukurovaproject activities.

(m) The Ministry of Finance (MOF). The proposed new accountingsystem is currently under review by the MOF officials.

(n) The General Directorate of Title and Cadastre (GDTC) wasinvolved in CUEP through the central agency and its localoffices in the provision of up-to-date and accurateinformation on cadastral base and on landownership patternsin the Cukurova Region to aid in successful design andimplementation. In close cooperation with the GDTC, CUEPrecommendations concerning legal arrangements with respectto upgrading and management areas were integrated into ActNo: 3290, enacted in May 1986. The provision with specialimportance (Article 20) is the new arrangement proposed byCUEP which gives power to the municipalities to undertakeplanning actions in "threatened areas" in line with"affordable standards" criteria. Project proposalsregarding two important aspects of financial arrangements,namely (i) establishment of an Upgrading Fund in themunicipalities; and (ii) power of municipalities toexpropriate squatter areas, were integrated into a furtheramendment to the Act which received the Parliament'sapproval. Cadastral application and updating are underway inProject towns in accord with the Project's priority areasand program, utilizing the modern equipment procured underthe project. In order to secure rapid and coordinatedimplementation in UEAs, new arrangements in land registrywere introduced. A pilot application was initiated inMersin, utilizing computer otitputs in land registry process.

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(o) The State Personnel Directorate (SPD) played a key role inreviewing the cadre request forms prepared by themunicipalities pursuant to the municipal reorganizationactivities. Despite the SPO's and MOI's official requestsfor the SPD to take into account the pilot character of theproject, the SPD was reluctant to forward the cadre requestforms to the Council of Ministers for timely approval andtended to make significant amendments in the cadre requests.

(p) The State Highway Authority (KGM) was very receptive to theCUEP proposals under its domain. The cooperation of KGM wasespecially significant for those municipalities where thenew (proposed) express way will cross-cut the major UEAs.

(q) The World Bank has shown a great interest to the Project andprovided a remarkable support to the project preparationactivities. Through numerous missions, CUEP progress wasclosely monitored at its various - and most critical stages.Notwithstanding the merits of the Bank's close involvement,a significant drawback has emerged despite the intentions ofall parties to sustain the pace of progress. The projectpreparation activities were virtually "frozen" thtoughoutthe duration of the Bank missions, which were rather lengthyand frequent. The time allocated by the consultants forbriefing the mission members and providing them withrelevant (generally revised) data barely left any time andenergy for the continuance of the work during the visits ofthe Bank missions.

15. Summary of Findings and Lessons Learned from the Borrowers' Perspective

15.01 The CUEP made significant contributions to the refinement andimplementation of the Government's decentralization policy. It had a strongimpact at the national level with respect to the revision of the urbanperspective, culminating in the amendment of pertinent legislation andpromotion of institutional development. Important achievements in developingand implementing the new urban policies and programs were made during CUEP.At the local level, HUDCs managed to develop over 10,000 housing unitsaffordable to the lowest income groups in UEAs. Investments are underway inthese areas to develop infrastructure also affordable to the low incomefamilies. Systematic approaches were developed for guiding the growth ofspontaneous settlements and for providing them with basic services in acoordinated manner. The legalization act-vities initiated in themunicipalities facilitated the distribution of over 6,000 individual titles.Lower cost planning and design standards were adopted for on-siteinfrastructure in the area-based programs and for the design of water andsewerage systems. Sewerage charges were introduced, progressive water tariffsadopted, and water tariffs increased significantly.

15.02 Continuous technical advice and support was provided to the concernedmunicipalities to assist them to manage growth and overcome servicedeficiencies, and invest, operate and maintain services on a self-sustaining

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decentralized basis. In this respect, innovative approaches to supportefficient urban growth were developed and maintained not only in terms ofappropriate design standards, but also in investment programming, financialmanagement practices and staff development activities.

15.03 An indlrect contribution of the Project manifests itself in the formof mushrooming consultancy organizations. In fact, there is an apparentlyincreasing desire on the side of the municipalities and other public agencies,not only in the region but throughout the country, to make use of consultancyservices in their operations. The CUEP evidently played a significant role inthe development of this new trend.

15.04 Arrangements have been made to enable a relatively smooth transitionfrom the CUEP to the CUDP. In order to ensure the continuity of the projectmanagement and coordination, a period of overlap is envisaged in theoperations of the PCU and the PRIMU. Furthermore, the incorporation of someof the PCU expertise into the PRIMU has been achieved. On the side of themunicipalities, however, the position of Adana is problematic.

15.05 After receiving a letter from the Treasury urging the municipalit.iesto make their final decisions on whether or not to proceed with CUDP, allmunicipalities expressed their intention to participate. The Mayors and someother officials of the five Project municipalities, accompanied by Governmentofficials and PCU members, went to Washington in April 1987 for negotiations.On their return, however, despite the consensus reached in Washington onoutstanding issues, the Municipal Assembly of Adana Metropolitan Municipalitydecided to withdraw from the CUDP. Ceyhan, however, revised its decision towithdraw in early October 1987 and restated its intention to be part of CUDP.Adana also reversed its decision to withdraw in November 1987.

15.06 A major lesson that must be avoided in other similar projectspertains to CUEP and the associated local finance by the central agencies.The relatively passive involvement and the lack of enthusiasm on the side ofthe municipalities basically stemmed from the fact that they did not pay forproject preparation activities. This weakness should be overcome in futureprojects by making the municipalities pay for the preparation of their ownprojects and thus ensure their keen interest in how their money is spent.

PROJECT COMPLETION REPORT

TURKEYCUKUROVA REGION URBAN ENGINEERING PROJECT

(LOAN 2532-TU)

PART III

STATISTICAL INFORMATION

Table 1. RELATED BANK LOANS/CREDITS

Loan/Credit Title Purpose Approval Status

Istanbul Urban To inprove metropolitan planming, transport/land use and 1972 ClosedDevelopment prepare investments in gecekondu upgrading, sewerage, and(Cr.324-TU) 1/ traffic control.

IstanbuL Water To expand water treatment, transmission, pumping and 1972 ClosedSupply (LN844- distribution system for the Istanbul metropolitan area.TU)

Istanbul To expand and improve sewage collection in Istanbul; to 1982 ClosedSewerage I reduce water pollution in the Golden Horn and the Sea of(LN2159-TU) Marmara; and to strengthen the institutional framework of

ISKI.

Izmir Water To assist in establishing an autonomous water and sewerage 1987 ActiveSupply & authority for Izmir; to encourage appropriate costSewerage recovery policies; to correct deficiencies in and expand(LN2818-TU) the capacity of Izmir's water and sewerage systems; and to

bring about environmental improvements and reduce healthhazards by eliminating open flows of untreated sewage inthe city and the discharge of untreated sewage to Izmirbay.

Cukurova Region To improve urban efficiency and finance investments in 1987 ActiveUrban water supply, soLid waste management, upgrading formalDevelopment housing areas, development of urban expansion areas forProject (CUDP) five municipalities.(LN2819-TU) _/

Istanbul Water To improve and extend sewerage service to 70X of the 1987 ActiveSupply and population of Istanbul by the end of 1994; to provide forSewerage appropriate treatment and disposal of sewage to protect(LN2888-TU) the water and shorelines of the Sea of Marmara and the

bosphorus; to reduce unaccounted-for water; and tostrengthen ISKI's operation and maintenance and industrialwaste management capabilities.

Ankara Sewerage To eliminate the discharge of untreated sewage to the 1989 Active(LN3151-TU) Ankara River and its tributaries flowing through Ankara;

to extend sewerage to approximately 850,000 unservedpersons; to reduce flooding during heavy rainstorm; and toimprove ASKI operations and maintenance.

1/ Preparation loan resuLted in no major investment operation.

2/ The Cukurova Urban Engineering Project (LN2537) was a preparation loan for this operation.

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Table 2. PROJECT TIMETABLE

Date Date DateItem Planned Revised Actual

-Identification S 02/18/84

-Preparation 09/84

-Appraisal Mission V 11/19/84 11/84

-Loan Negotiations 03/25/85

-Board Approval 05/09/85 05/09/85

-Loan Signature 05/29/85

-Loan Effectiveness 07/24/85

-Project ComLetion 12/31/88 12/31/8t

-Loan Closing 06/30/89 06/30/89

LN2537 and LN2819 identified simultaneously.

No separate appraisal report was prepared. See President's Report (p-3935 , April 18, 1985).

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Table 3. CUJLATIVE LITIMATED AND ACTUAL DISBURSEMENTS

(US S MIn)

FY 1985 1986 1987 1988 198?

Appraisal Estimate 1/ 1.7 6 8.6 9 9.2

Actual 0 5.01 8.48 9.06 9.2

Actual as X of Estimated 0 83X 99X 1O12 100l

Date of final Disbursement 01/20/89

I/ From President's Report. There is no separate appraisel report.

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Table 4. PROJECT FINANCING

P.evisedSource Planned 05/27/87 Final

IBRD:EAcenditure Categories:

Consultant Services 6.5 7.508 8.132

Equipment 0.83 0.68 0.668

Special Account i/ 1 0.611 0

Refunding ProjectPreparation Advance 0.6 0.399 0.399

Unallocated 0.27 0 0

Total IBRD 9.2 9.2 9.2

Government: 1.4 4.0 2/ 4.0

Total 10.7 13.2 13.2

J/ To prefinance Bank's share of eligible expenditures.

2/ Includes partial financing from PPF.

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Table 5. Studies. Feasibilitv and Design Vork Carried Ouc Under CRE?p

PHASE I Reports Precared by Consultants (April-August 1985)

Reports:

1. Project Summary and Report (2 volumes)2. Town Report: Adana3. Town Report: Ceyhan4. Town Report: Iskenderun5. Town Report: Mersin6. Town Report: Tarsus

Working PaiLers:

7. Regional Perspective8. Regional Perspective Supplement9. Regional Urban Growth Management10. Municipal Finance11. Water Supply12. Sewerage, Stormwater and Sewage Disposal13. Solid Waste Management14. Electricity and Telecommunications15. Urban Expansion and Gecekondu Upgrading Strate-16. Economic Considerations

TORs

17. Iller Bank Management Study18. National Cadastral Study19. Cadastral Equipment ?rocuremene20. Emplovment and Urban Growth21. Household Surveys for phase II and III.22. Orthophoto Mapping23. Other Muncipal Projects and Housing Finance24. Telecommunications Master Plan and Training Study

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cont. Table 5. Page 2 of 7

- PHASE TT Documencs (September 1985-December 1986)'

General (by Category):

Proiect Management and Finance

1. Project Responsibilities2. Financial Plans and Forecasts3. Economic Considerations and Project Appraisal

Housing

4. Housing Finance Case Studies5. Household Surveys (2 volumes)6. Real Estate Enquiry7. The Potential for Extending Credit to Building Materials Suppliers8. Urban Expansion Marketing9. Utban Expansion Areas; Policy Statement on HUDCs10. Informal Housing Upgrading and Expansion

Municipal Engineering Components

11. Engineering Standards and Criteria12. Policy Statement on Water and Sanitations Cor: rations (WSCs)13. Water, Sanitation, and Solid Waste Operations nd Maintenance, Equipment

Specifications and Schedules14. Program for Water and Sanitation Leak Detect- and Data Base15. Solid Waste Management16. Procurement of Solid Waste Services17. Geotechnical and Topographical Surveys

Municioal Finance

18. Municipal Assets Valuation19. User Charges and Cost Recovery20. Accounting Systems Manual *21. Professional and Advertisement Taxes22. Property Tax23. Iskenderun Payroll/Personnel System24. Iskendbrun Purchasing and Stores Svstem25. Iskenderun Vehicle Management System26. Iskenderun Financial Ledger and Costing System27. Computer Systems, Iskenderun General Systems Examined28. Iskenderun Water Billing System29. Iskenderun Co-mputer Strategy

!Including 7 month period at the end of phase II when consultantscontinued to work, however, phase III contract was being negotiated.

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cont Table 5: Page 3 of 7

Inscitutional-Devel ooene and Planning

30. Municipal Organization and Management31. Resource Management in Municipalities32. Iller Bank Managment Study (3 vol)33. Muncipal Manpower Development34. Sub-Regional Plan35. Review of Upgrading Plan36. Informal Housing Upgrading37. Municipal Organization Master Plan

TORs Preoared for:

38. Nationwide Training Study39. Health Impact Study

TOCWN-SPECIFIC REPORTS

Adana:

40. Adana Transport Study41. Water Supply42. Sewerage and Drainage43. Solid Waste44. Urban Expansion Area Feasibility Study45. Informal Housing Upgrading*46. Municipal Organization Master Plan *

Iskenderun:

47. Iskenderun Transport Study48. Water Supply49. Water Resources:Hydrogeological Appraisal50. Sewerage and Drainage51. Solid Waste a52. Urban Expansion Area Feasibility Studv53. Municipal Organization Master Plan*54. Informal Housing Upgrading*

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Cont Table 5: Page 4 of 7

Tarsus: -

55. Tarsus Transport Study56. Water Supply57. Sewerage and Drainage58. Solid Waste59. Urban Expansion Feasibility Study60. Informal Housing Upgrading*61. Municipal Organization Master Plan*

Ceyhan:

62. Sanitation63. Water Supply, Operations and Maintenance64. Solid Waste65. Housing Development Management*66. Municipal Organization Master Plan *

Mersin:

67. Mersin Transport Study68. Water Supply69. Sewerage and Drainage70. Solid Waste71. Urban Expansion Area Feasibility Study

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cont Table 5: Page 5 of 7

PHASE II! Reoorts (January-July 1987)

General

1. Post Appraisal Project Update2. Project Cost:Software and Users Manual*3. Water and Sanitation Model:Software and Manual*4. Urban Expansion Area '-el:Software and Manual*5. Housing and Urban Development Company (HUDC)Kodel:Software and Manual*6. Municipal Affordability Summary:Software and Manual*7. Regional Urban Growth Management Workshop Manual*8. Tendering Procedures Workshop Manual*9. Good Citizen Public Relations-Operations Manual No. 2*10. Plant and Vehicle Maintenance-Operations Manual No. 1111. Solid Waste Management-Operations Manual No. 1212. Project Appraisal, Implementation, Control and Monitoring by

Muncipalities, Iller Bank, and PRIMU*13. Community Facilities Building Design for Health Centers/Prim. Schools*14. Informal Housing Ugrading and Devt Mgmt. Areas-General Engineering*15. Management of Water/Sewerage O/K-Operations Manual No. 3*16. Road Maintenance:Operations Manual No. 5*

Huncioal Finance:

17. Inzome Database Guidelines*18. Income Collection Efficiency Guidelines*19. Cost Recovery:Recommendations for Improved Practice and Legislation*20. Municipal Accounting Manual*21. Management Accounting-Operations Manual No. 8-c22. Income Model:Software and Users Manual*23. Working Papers on Financing and Affordability Housing*

Institutional Devylooment and Planning

24. Progress Report on Municipal Reorganization in Iskenderun, Mersin, Tarsus*25. Manpower Development Workshop Manual*26. Procedures for Municipal Planning Units*27. Cukurova Municip4lites Training Assoc. (CMTA) Constitution*28. CMTA Six Year and Annual Plans*29. Corporate Planning-Operations Manual No. 1*30. Urban Planning and Control-Operations Manual No. 7*31. Manpower Planning, Training, and Personnel Mgmt-Operations Manual No.9*

- 37 -

cont Table 5:Page 6 of 7

Town Studi&&:

32. Adana Short Term Housing Strategy (87-92)*33. Kiremithane Housing Devt. Mgmt. Area Improvement Plan *34. Kiremithane Housing Development 8gmt. Community Facilities Brief*35. Kiremithane Informal Housing Upgrading Area Improvement Plan*36. Kiremithane Informal Housing Upgrading Community Facilities Brief*

37. Hydrogeological Study

Final Designs and Tender Documents:38. Urban Expansion Area On-and Off-Site Infrastructure*39. Water Supply*40. Sewerage, Trunk Sewers and Treatment Plants*

Iskenderun

41. Iskenderun Housing Strategy (87-92)*42. Yildirimtepe Housing Devt. Mgmt. Area Improvement Plan*43. Yilderimtepe Housing Devt. Mgmt. Community Fa: Lities Brief*44. Yildirimtepe Informal Housing Area Improvemen- ?lan*45. Yildirimtepe Informal Hsgn. Upgrading Communi- Facilities*46. Meter Adjustment and Repair Shop Report*47. Resource Mgmt:Iskenderun Water and Bus Operat: ns*

Final Designs and Tender Documents:48. Sanitary Landfill Site Development49 Water Supply, Extracting and Pumping, Sanitati'n & Drainage Secondary

and Tertiary Networks50. Resevoirs

CeXhan

51. Urban Expansion Area Feasibility Study52. Sewerage/Drainage Gazi Osman Pasa Preliminary Design Report

a

Final Designs and Tender Documents:53. Sanitary Landfill Site Development*54. Sewerage and Drainage*

- 38 -

cont Table 5:Page 7 of 7

Tarsus -

55. Tarsus Short-Term Housing Strategy (87-92)*56. Yanimahalle Housing Development Management Area Improvement Plan*57. Yenimahalle Housing Development Mgmt. Community Facilities Brief*58. Gaziler Informal Housing Upgrading Area Improvement Plan*59. Gaziler Informal Housing Upgrading Community Facilities Brief*60. Bahce-Barbaros-Girne Informal Housing Upgrading Framework Plan*61. Bahee-Barbaros Informal Hsng. Upgrading Community Facilities*

Final Design and Tender Documents:62. Urban Expansion Area On- and Off-Site Infrastruture63. Trunk Sewers, Waste Treatment Plant, Secondary/Tertiary Networks

Merlin

64. Mersin Housing Strategy (87-92)*65. Demirtas Informal Housing Upgrading Area Impr' ement Plan*66. Demirtas Informal Housing Upgrading Communit. acilities Brief*67. Osmaniye Housing Development Mgmt. Area Impro- tent Plan*68. Osmaniye Housing Development Mgmt. Ccmmunity :ilities Brief*

Final Designs and Tender DQcuments:69. Urban Expansion Area On- and Off-site Infrastr:cture

*Turkish and English versions

.

- 39 -

Table 5A

PROJECT COST(US S Million)

IeA fAppraisal Estimate ActualLocal Foreign Localcosts costs Tota1 IBRD Funds Total

1. Project Coor. Unit(PCU) 1.43 0.39 1.82 A/ 1.11 0.25 1.36

2. InstitutionalFeasibility & designstudies 3.21 2.52 5.73 6.72 3.4 10.12

3. Cadastral Surveys/Equipment 0.14 0.85 0.99 0.88 0.16 1.04

4. Special Studies 0.27 0.27 0.54 h/ 0.5 0.18 0.68

5. Physical Contingencies 0.35 0.22 0.57

6. Price Contingencies 0.65 0.41 1.06

Total Project Cost 6.05 4.66 10.71 9.21 3.99 13.2

a/ Partially financed with $600,000 advance from project preparation facility.

h/ Adana Transport and Iller Bank studies.

c/ Based on weighted average exchange rate for 1986-87 disbursement period ofUS$1-757 TL.Counterpart funds from State Planning Organization.

- 40 -

r3ble 6. Satatnt of Crltince with Leal Covenants

LA SeCtion CovnUtS Deadtlin forCotiiice Status

3.02 Cii) fatabtish/meintain Project Coordination unit Established; demobilizedin October 1987 when llter Bankbegan to execute CuoP

3.32 Ci) Estabtish/meintain regional/notionat Established, if at atl, in name onlyproject sttering comaittees and considered not to have

functioned effectively.

3. 4 Ca) Borrower shall aploy consultai.ts to Satisfactory.assist in carrying out project

3.04 (b) Borrower shall make available to Nostly satisfactory though itconsultants ltL such information was not always possible to coordinateas may be necessary for project pltars with ongoingsuccessful execution. investmant plans by other

goveramental agenies.

3.C4 tc) Borrowr shall furnish to the Bank copies of Satisfactory.doctumnts prepared by consultants.

4.0I ii0) Furnish audited anntul accounts 6 mos Finat audited accovnt due June ;° ;-after FY

aole ?. MISSIONIS - 41 -

Stage of month/ Number SW Specialization Perfortance Types

Project Cycle Ve Persona in Field RePrtsented Rating Status 2/ of -:oleems

Through Appraisal

:Zentification 1/ 3/84 7 11 Deputy Chief,EMPU"

Economist

municipal Engineer

Loan Officer

Financial Analyst

2 (uniknox affiliation)

Identification 1/ 5/84 4 10 Economist

Municipsl Engineer

Sanitary Engineer

Financial nalyst

Identification 1/ 6184 5 10 Economist

Municipal Engineer

Economist

Sanitary Engineer

Consultant(unic. Finance)

Oreparation 9/84 5 9 Economist

Deputy Chief

Muncipal Enginee-

Financial Analys

Consultant(gmt. i

Appraisal 11/84 7 14 Municipal Engineer

Economist

Sanitary Engineer

Training Specialti,

I consuLtant Civi -ng

(2) Unknown

I/ CUOP identified atorn with other potential urban investments.

2/ Ratings: first ntufer luProblm free or minor; 2aModerate; 3smajor

second nuiber l-lmproving; 2aStationary; 3xoeteriorating

- 42 -

cont. Table 7.

Stage of Month/ MueSbr SW Speciatization Performance rypes

Project Cycle Year Persons in Fleld Represented 4/ Rating Status of Problems

SUPERVISION

Supervision 1 4/85 2 2 EconomistMunicipal Engineer nore

Supervision 2 7/85 3 2 Economist 1/2 none

Sanitary Engine r

Municipsl Engineer

Supervision 3 9/85 4 6 Economist 1/2 Financial

municipal Ernineer

Financial Analyst

Sanitary Engin r

Supervision 4 11/85 4 4 Deputy Chief nor

EconomistUrban Plarner

Engineer/Pta r

Supervision 5 1/86 6 10 Economist 1/2 none

Urban Planner

Municipal Engineer

Engineer/PlannerDeputy Chief

Engineer

Supervision 6 3/ 5/86 8 20 Economist none

Loan Officer

Deputy Chief

Engineer/Ptanner

Financial Analyst

Engineer

Urban Planner

Engineer

Attorney

Supervision 7 4/ 6/87 5 14 (M)Econamist 1 none

Engineer/Ptamer

1/ Consultant(Munic. fnance)

Consuttant (Enliree-)

Supervision 8 4/ 9/87 3 7 Economist

Sanitary Engineer

Engineer/Ptanner

3/ Combined preparation mission for CUOP (LN2819).

4/ Also supervised start-up of CUOP Ml2819), which was not yet effective.

-43 -

Table 6. "NK STAFF IRIIWCES ASSOCIATED WITH CUKUROVA

anag,nnt Infornmtion

Loan Titte Syste Classification Staffweks

Expenses

CRUEP 1/ Preparation (LEMP) 0

CRUEP Pre-Appraisal (LOP) 8.6

CRUEP Apprisl.t (LENA) 32.4

CRUEP Negotiations (LEMN) 6.2

CRUEP Supervision (SPM) 30.1

CUOP 2/ Preparation (LEMP) 164

CL0DP Pre*Apprsisal (LOP) 32.2

Subtotat 273.5 stwks(5.25 staffyears)

CUDP Appraisal (LENA) 82.4

CUOP Negotiations (LENN) 6.8

TOTAL 362.7

1/ Cukurova Region Urban Enginerir.g Project MLN2537)

2/ Cukurove Urban DOevlop ant Project (LN2819)

- 44 -Tab le 9

ettudV URAM OIVILOPuET P*epJeT

SUMARY 3f AIIANGIENITS FOR IMPLEMENT1NG FINANCE ANO COST REt1VERY

9mpl..et ing cost RecoveryAa.nev ~ Fl.M*.jMi<rU qmenittnt

I. MU"C

A.Ura waie ra

1. LigN DSP *Land Price

(I) Site preparation NIUOC to. to. n Land Price(iti Water & Sanitation 4Wu0C to, We. M Land Price

(tii) Roads. footpatns mUOC iS. bO. M Land Pricedrainage

(iv) Ftre stations. N n. tS 14. Taxescomunity Ologs.

3. Ofsite tnfpagtructurp(a) Water and Sanitation wSO to. We. N Land Price. T/C(b) toads t oU, Iw. n Land Price. N. Tame

4. oneav.mmt facilities(Schtools. healtn. police) SPA G e. Sudget

S. Iatt^ util1tteq

(a) 'eecaOMnic3tXIS PTT PT-.~ r.g *;lt .- ,*r ln>n

1. Water. Sanitation *etworIks wsp N. 3*. "a* 'tet-3ries 5so :a. - 3a t. Lee. .

2. RoaaS. Sewalks * 4etwor: 4 N, t. wi N. '1Jrertiaries l e. wS e bC e. Levy. L.C..

2. Government facilities. NattonalUtilittes as for Urba Exasion Areas

C. nia&I Enen.rne

1. Water and Sanitation wSO M. le. w T/C. I. Levy2. Solid waste M N. tS. we M. Taxes.3. DratnaeN l. 13. WN m. Taxes4. loads i .1. A4 M. Taxes. t. Levy

O. minttiaai FtaaMe and Nannamt IS. N N, to. W4 1t. N. Tames

tY. ATt*EL AM. *ItfluI*L

1. Training CNTA N. in. we N. Taxes/G. Budget

2. MIaer Sank to le, la to Inco

III. ESUJMZJ*fIft

1. PtwU toS 1. .st I tncom

WM9ll: CNtA - Cukurova umnicipalitigs Training Associatioen. oSr - Oevelopnt Support Fund. G- Government. HUOC - Hoasing and Urban Oevelopment Corporattons. tO - Iller Sank. 1. Levy -tInrovOnent Levy. L.C. - Leg1azation Charges. - Mnicipalities. 1N. T"as - ICtmipal taxesPTt - Posts and tAltca_ications uthority. SAP - SeIal ProviCIal Administration. tK. -

Turkey nlectrtCity Authority. T/C - Tariffs and Charges. wM - asicipal Wator and Sanitatiop0epartment.