Document of

The World Bank

FOR OFFICIAL USE ONLY

c1e. 2Z 06 - URepcert No. 8921-UG

STAFF APPRAISAL REPORT

UGANDA

FIRST URBAN PROJECT

DECEMBER 3, 1990

Infrastructure Operations DivisionEastern Africa Department

This document has a resticted dibon and may be used by recipients only in the perfonnmce oftheir officiual duties. Its contents may not othenrise be disclosed without World Bank authrzaion.

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UGANDA

FIRST URBAN PROJECT

CURRENCY EQUIVALENTZMay 1, 1990)

Currency Unit - Uganda Shilling (U Sh)US$1.00 = U Sh 400U Sh 1.00 - US$0.0025SDR 1.00 = US$1.38

FISCAL YEAR

Government, NWSC July 1 to June 30KCC October 1 to September 30

WEIGHTS AND MFASURES

Metric System

ABBREVIATIONS AND AC'ONYMSAfDB = African Development BankDANIDA = Danish International Development AgencyEDF = European Development FundEEC = European Economic CommunityERP = Economic Recovery ProgramGOU = Government of the Republic of UgandaGTZ = Gesellschaft fuer Technische ZusammenarbeitICB International Competitive BiddingIPA = Institute of Public AdministrationKCC = Kampala City CouncilLALF = Local Authorities Loan FundLCB = Local Competitive BiddingLGRC = Local Government Resource CenterMEP = Ministry of Environment ProtectionMLG = Ministry of Local GovernmentMOHUD = Ministry of Housing and Urban DevelopmentMPED 8 Ministry of Planning and Economic DevelopmentNDF = Nordic Development FundMWMD = Ministry of Water and Mineral DevelopmentNWSC = National Water and Sewerage CorporationPCU = Project Coordination UnitPPD = Physical Planning DepartmentRDC = Reconstruction & Development CorporationRDP = Rehabilitation & Development ProgramRWSG - Regional Water and Sanitation Group (Nairobi)TID = Training and Institution DevelopmentULC = Uganda Land CommissionUNCHS = United Nations Center for Human SettlementsUNDP = United Nations Development ProgramUTB = Uganda Tender BoardWHO - World Health OrganizationWDD = Water Development Department

FOR OMCIAL USE ONLYUGANDA

FIRST URBAN PROJECTSTAFF APPRAISAL REPORT

TABLE OF CONTENTSPage

CREDIT AND PROJECT SUMMARY . . . . . . . . . . . . .. . . . . ... . i-i

I. COUNMRY BACKGROUNDA. Geography, Climate, Population, Resources . . . . . . . . 1B. Economic Performance . . . . . . . . . . . . . . . . . . . 1

II. THE URBAN SECTORA. National Context to Urban Development . . . . . . . . . . . 3B. Current Urban Conditions . ................... . 4C. Government Strategy for the Urban Sector . . . . . . . . . 8D. Previous Sector Activities .. ........ ...... 9E. Rationale for IDA Involvement . . . . . . . . . . . .. .. 10

III. THE PROJECTA. Origin and Preparation . . . .11B. Objectives . . . . . . . . . . . . . . 11C. Description . . . . . . . . . . . . . . . . . . . . . . 12D. CostsFnni . . . . . . . . . .. . . . . . . . . . . . . . .17E. Financing . . . . . . . . . ....... . . . . . . . . .19

IV. PROJT I- PLEM1NTATIONA. Th%. Borrower and On-Lending Arrangements . . . . . .20B. Institutional Arrangements for Implementation . . . . . . .21C. Procurement . . . . . . . . . . , . . . . . . . . . .21D. Disbursement . . . . . . . . .. . . . . . . . . . . 23E. Implementation Schedule . . . . . . . . . . . . . . .24F. Land Acquisition and Plot Allocations . . . . . . . . . . .24G. P:oject Monitoring, Accounting and Auditing . . . . . . . .25

V. ANALYSIS OF IMPLEMENTING AGENCIESA. Kampala City Council . . . . . . . . . . . . . . . . . . .26B. Ministry of Local Government . . . . . . . . . . . . . . .30C. Physical Planning Department . . . . . . . . . . . . . . .30D. Institute of Public Administration. . . . . . . .31E. Project Coordination Unit.. . . . . . . . . . . . . . . . .32

This report Is based on the findings of an Appraisal Mission consisting of Mr. R. seardmore(Task Manager), Me. Hayley Corts (Senior Economist), Meere. S. di Zitti (UrbanPlanner/Consultant), F. Fisher (Institutional Development Specialist/Consultant), S. Keith(Property Tax Speciois t/ Consultant), S. Jacobi (Water Speteltiet, RASO Nairobi) and K.Kuhlmann-Caplto (Financial Analyst/Consultant - OTZ) who vi ... ed Uganda In may 10. Mr S.Shantaram was responsible for report procssing. The prinecpal reviewrs were Messrs. C.E.Madavo (Diroctor, Eastern Africa Department), F. Loethem (Project Advisor, AF2), Jonathan C. Brown(Division Chief, AF2 Infrastructure Operations Division), and J. Wright (Lead Advisor, INURD).

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.

VI. FINANCIAL ANALYSIS OF KAMPALA CITY COUNCILA. Psst and Present Financial Performance . . . . . . . . . . 33B. Recent Improvements in General Accounting . . . . . . . . . 37C. Financial Forecasts. . . . . . . . . . . . . . . .. . 37D. Project Cost Recovery. . .. . . . . . . . . . .. . . . . 39S. Affordability . . . . . . . . . . . . . . . . . . . . . . . 41

VII. ECONOMIC ANALYSISA. Primary Project Justification . . . . . . . . . . . . . . . 43B. Economic and Other Benefits .. . . . . . . . . . . . . . 44C. Impact on Women . . . . . . . . . . . . . . . . . . . . . . 47D. Environmental Impact . . . . . . . . . . . . . . . . . . . 47E. Community Participation . . . . . . . . . . . . . . . . . . 48F. Project Risks . . . . . . . . . . . . . . . . . . . 48

VIII. AGREEMENTS REACHED AND RECOMMENDATIONA. Actions Already Taken . . . . . . . . . . . . . . . . . 49B. Agreements Reached during Negotiations . . . . . . . . . . 49C. Recommendation . . . . . . . . . . . . . . . . . . . . . . 51

ANNEXES

1 - Kampala Urban Markets Rehabilitation Program2 - Rehabilitation of Kampala's Refuse Collection and Disposal System3 - Kampala Street Rehabilitation and Maintenance Program4 - Strengthening Urban Investment Planning Capacity5 - Provision of Serviced Residential Land6 - Rehabilitation of Valuation and Rating in Kampala7 - Institutional Development of Local Government Bodies8 - Terms of Reference for Key Technical Assistance Personnel9 - Rural Water Supply Project Preparation Activities10 - Details of Procurement Methods11 - Schedule of IDA Disbursements12 - Project Implementation Schedule13 - Project Supervision Plan14 - KCC's Past and Projected Financial Performance15 - Economic Rate of Return and Sensitivity Analysis16 - Selected Documents in Project File

CHARTS

1 - KCC: Organization Chart2 - PCUt Organization Chart

MAP: IBRD No. 22472

UGAJDA

FIRST URBAN PROJECT

Credit and Prolect Summary

Borrowers The Republic of Uganda

implementing rampala City Council (MCC)Agencies and Ministry of Local Government (MLG)Beneficiaries: Physical Planning Department (PPD) of Ministry of

Housing & Urban DevelopmentInstitute of Public Administration (IPA)

Credit Amount: SDR 20.7 million (US$28.7 million)

Credit Terms: Standard IDA terms with 40 years maturity

On-lendint Proceeds to KCC in the form of i) a grant of US$4.5 millionTerm:s and ii) a loan of US$21.2 million at 2Z interest rate to be

repaid over 25 years, including five years grace.

Proiect The proposed Project would support the Government's effortsDescriptiont to decentralize the responsibility for the planning, design

and management of urban services to local authorities whileassisting with reconstruction of the country after a periodof political instability, social strife and physicaldestruction. The Project would achieve the followingobjectives: i) improve living conditions and alleviatepoverty in Kampala by restoring key infrastructureservices; ii) support the development of decentralizedlocal urban management by strengthening the revenue base,financial management and technical capacities of XCC and byimproving the ability of central government to assist localauthorities to increase their revenue base and strengthenfinancial management; iii) strengthen the country'scapacity to manage the process of urban land development;and iv) promote sound cost recovery policies and practices.The Project includes support for: i) the rehabilitation ofurban markets, streets and drains, refuse collection anddisposal; ii) the servicing of land for residentialdevelopment; iii) the preparation of up-to-date mapping anda strategic urban development plan for Kampala; and iv)technical assistance and training for MCC, MLG and PPDstaff.

Proiect Risks: The main risks affecting the Project concern theeffectiveness of the two key implmenting agencies, ICC andMLG, given that they are emerging from a long period ofinstitutional deterioration. KCC is facing a shortage ofqualified staff and political constraints to rapid

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increases in municipal taxes, rates and charges. TheMinistry suffers from low salary levels and overall centralgovernment budgetary constraints. However, KCC has madedramatic progress in the past year in recruiting qualifiedstaff and increasing revenue. The proposed components oftechnical assistance and training in this Project, togetherwith macro-economic measures designed to continue overalleconomic recovery supported by IDA restructuringoperations, are expected to mitigate these risks.

Estimated Costs: Item Local Foreign Total------US$ million------

Infrastructure Rehabilitation 4.1 12.4 16.5Urban Mapping and Planning 0.2 2.3 2.5Kawaala Sites and Services 1.0 3.2 4.2Technical Assistance and Training (KCC) 0.4 3.0 3.4Technical Assistance and Training (MLG) 0.7 0.8 1.5Project Preparation 0.1 2.1 2.2

Total Base Costs 6.5 23.8 30.3

Physical Contingencies 0.7 2.2 2.9Price Contingencies 1.2 4.1 5.3

Total Project Costs 8.4 30.1 38.5

Financing Plan: IDA 2.6 26.1 28.7NDF 1.1 3.5 4.6GTZ 0.1 0.5 0.6Government 4.6 0.0 4.6

Total 8.4 30.1 38.5

EstimatedDisbursements: Bank FY 91 92 93 94 95 96 97 98

Annual 1.8 2.9 4.8 6.7 6.5 4.3 1.2 0.5Cumulative 1.8 4.7 9.5 16.2 22.7 27.0 28.2 28.7

EconomicRate of Return: 242

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I. COUNTRY MCKGROUND

A. Geography. Climate. Population. Resources

1.01 Uganda is a landlocked country bounded by Kenya, Tanzania, Rwanda,Zaire and Sudan. It covers an area of approximately 241,000 sq.km. of whichabout 20 percent consists of numerous waterways, swamps and lakes, mostnotably the Nile and its source, Lake Victoria. Most of Uganda is on aplateau, with about 80 percent at an altitude of 1000-1500 m.

1.02 The altitude contributes to Uganda's pleasant climate. There islittle seasonal variation in temperature because of its position astride theecuator. Mean maximum temperatures range from 200C at night to 35*C duringthe day, mean minimum temperatures from 8°C to 230C. Annual rainfall variesconsiderably within the country. The northeast has an arid climate averaging500 mm of rain while the south receives about 1400 mm of rain annually. Thereare normally two dry spells during the year, one from December to February,the other in June and July.

1.03 The population is estimated at 16.5 million and growing at about3.2 percent annually. Per capita income is in the order of US$230. About 90percent of the population is rural. Political stability and security problemsin the period 1971-86 led to severe dislocations of the country's population.These have overshadowed previous patterns of internal migrations, both rural-to-urban and region-to-region. Recent improvements in security, therehabilitation of infrastructure, and economic recovery are expected toincrease migration to the urban areas.

1.04 The country is not well endowed with minerals or fossil fuel, buthas rich soils and a favorable climate for agricultural production. It hasextensive surface water resources as well as a Wery large hydro-electricalpotential which has been only partially exploited. At present, agriculture isthe backbone of the country, contributing about 70 percent to the GDP.

B. Economic Performance

1.05 Since early 1986, after 15 years of political strife and civilwar, Uganda has been engaged in a major effort of political stabilization,reconstruction and economic recovery. In May 1987 the Government started aneconomic rehabilitation and adjustment program by gradually liberalizing theexchange and trade system, reconstructing the transportation system and publicutilities and strengthening the public sector institutional framework.However, owing in part to larger than programmed credit expansion to both theGovernment and private sector, inflationary pressures increased and as theexchange rate was not adjusted sufficiently, it became seriously overvalued.Uganda thus fell short of achieving the economic and financial objectives ofits 1987188 program.

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1.06 During the subsequent two years, however, the Government tooksteps to prevent a recurrence of past problems and acted to broaden and deepeneconomic reforms. In response to these measures, the domestic economicsituation has responded favorably. Output growth has continued in the 6-7percent range, reflecting in particular e marked recovery in agriculturalproduction and manufacturing output. Considerable progress has also been madein bringing down the inflation rate. From an annual rate of 240 percent inFY88, the end-year rate for FY89 was reduced to 86 percent in FY89 and to 29percent in FY90 (below the target of 30 percent).

1.07 Other significant achievements made during the period include therestoration of peace and security, the reestablisbment of politicalinstitutions that reflect the plural character of Ugandan society, andinstillin- a measure of discipline in the public service. These have beenmajor factots in the restoration of confidence in the private i-ector and therevival of economic activity. Marked improvement in the private sectorenvironment has occurred, in part, by significant liberalization of tradebrought about by limiting monopolistic practices, facilitating access toforeign exchange, and dismantling some price and distribution controls.

1.08 Building on the results obtained in FY90, the Government'sprincipal economic objectives over the period 1990/91-1992/93 are to continuea rapid overall economic recovery while further reducing the rate of inflationsubstantially, to attain a sustainable balance of payments position, and tocontinue the reconstruction and rehabilitation of social and institutionalinfrastructure.

II. TUR URMN SECTOR

A. National Context to Urban Develonment

2.01 Uganda's urban settlement pattern is characterized by the primacyof the capital Kampala (estimated population 700,OOC), which together withEntebbe (estimated population 30,000) houses the central government servicesand is the nerve center of the country's commercial, transport andcommunications systems. Next in importance is Jinja (estimated population130,000), a major industrial center strategically located at the point wherethe Nile flows from Lake Victoria through the Owen Falls dam. A dozen urbancenters with populations between 20,000 and 50,000 form the next tier in theurban system. These towns were originally established as administrative andservice centers evenly distributed throughout the country, but a number ofthem have since developed more complex economies. In addition there aresmaller administrative, service and market centere of 5,000 to 20,000 people.Lastly, there are numerous market centers with population between 2,000 and5,000 that also have basic educational and health facilities,

2.02 The urban areas c ntain about 10 percent of Uganda's totalpopulation of 16.5 million (1989 estimate). Urban growth was substantial inthe 1960s. The difficult political and economic situation in the 1970s andearly 1980s contributed to a dramatic slowdown in rural-urban migration. Therecent general improvement in security and the program of economic recoveryare expected to spur urban growth to about double the 3.2 percent growth rateof the total population.

2.03 The functions of the urban sector in this predominantlyagricultural economy are to provide a wide range of services to the couutry,both through the private and the public sector. They are also markets forsurplus food crops. The urban centers act predominantly as trading centers,collecting and distributing local as well as international goods to and fromthe rural areas. While agro-processing industries such as coffee hulleriesand cotton ginneries are spread throughout the rural areas in Uganda, urbancenters house other industries, with some concentration in Kampala and Jinja.Professional services such as medical, legal, insurance and banking servicesare also concentrated in urban areas. In addition, the network of servicesprovided by the central and local government operates generally through thesame pattern and hierarchy as the market centers. The exceptions includedistrict headquarters in sparsely populated areas which have little economicactivity. Communication and movement between urban and rural areas continuesat a low level, but relatively few government services reach the rural areas.In addition, the provision of consumer and producer goods to farmers isinadequate and expensive. It is, however, expected that with therehabilitation of roads and tele- ommunications and improved transport thephysical obstacles will dimin.

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D. Current Urban Conditions

2.04 The insecurity, civil scrife and economic decline in Ugandabetween 1971 and 1986 had a devastating effect on the administration,financing, services and infrastructure of the urban areas. Kampala was noexception. Revenues, which previously sustained an acceptable level ofservice, could not keep up with rising costs, fuelled as they were byhyperinflation. The level of service dropped, the administrative frameworkwas weakened by the exodus of qualified personnel, and infrastructure andutility networks were neglected or damaged. Indeed, while Kampala'spopulation more than doubled between 1971 and 1986, no investments were madein infrastructure and services. Fewer services are now being consumed by avastly expanded market.

Existing Institutional Arrangements

2.05 Responsible "ational Agencies. The Ministry of Local Government(MLG) supervises, regulates and aJvises City, Municipal and Town Councils inmatters of financial planning and centrol, policies, and development projects.The Ministry of Lands and Survey and the Ministry of Housing and UrbanDevelopment provide essential services for local governments such as mappingand the cadastre, and urban development plans and housing schemesrespectively. The Ministry of Health, together with the local councils, isresponsible for law cost sanitation and health education. The Public ServiceCommission appoints, hires, and fires key financial staff, including CouncilTreasurers. The Auditor-Gen.iral's office is charged with carrying out year-end financial audits of councils in instances where the councils do not retainindependent auditors. The power of a council to levy local taxes isrestricted by the national taxing authority of the Ministry of Finance. TheMinistry of Finance also controls the total amount of block grants going tourban authorities, as well as any capital contributions going to the LocalAuthorities Loans Fund. The LALF, introduced in the late 1950's and managedby MLG, is now inactive, having last received funds amounting to U Sh 1million from Ministry of Finance in 1984/85. The Ministry of Commerce setsbusiness license fees (presently at very low levels) in the urban authorities.Finally, Resistance Committees (Para. 2.07), organized in different levelsstarting from the municipal down to village level, are assisting localgovernments in their activities and in mobilizing community participation.

2.06 Kampala City Council (KCC) is responsible for providing urbanservices as mandated under the Urban Authorities Act 1964 and the ResistanceCouncils and Committees Statute 1987. The organization of KCC is based on thetraditional anglophone East African local authority model. The Town Clerk,reporting to an elected Kampala City Resistance Council, directs theactivities of five departments responsible for administration, engineering andsurvey, finance, public health, and education. The Council's primaryfunctions relate to public markets, public housing estates and primaryschools. It is also responsible for administering the Public Health Act andfor enforcing planning and building regulations. The current level ofactivity, still very low owing to lack of financial, human and materialresources, is nevertheless on the increase.

2.07 Resistance Committees. As a first step to overhaul theprevailing urban-rural administrative structure, the present Government hasintroduced a major change in the political organization of urban and ruralareas. It has established Resist&ice Committees (RCs) in five layers throughwhich popular representation progresses from the smaller local units to thenational assembly. This communication linkage also operates in reverse fromthe upper levels of Government down to the grassroots levels for balancedfeedback. The system also exists side by side with the earlier administrativeset-up in which authority flows from the center througn districts, sub-districts, counties, sub-counties and parishes or municipal councils down tothe local levels. The RCs are, inter alia, aimed, and have in effect startedto promote community participation and local initiatives so as to overcome thedisaffection of the population which had become accustomed to relying onGovernment for infrastructure, economic and social services in return fortheir tax contribution. The five levels of RCs, with their correspondingtraditional geographical subdivision titles, are as follows:

Resistance Committee 1 - villageResistance Committee 2 - parishResistance Committee 3 - sub-county/town councilsResistance Committee 4 - county/municipalitiesResistance Committee 5 - district and KCC

Tne Resistance Committees are the political level organizational set up atevery level, while the chiefs are civil servants who advise ICs and implementtheir decisions.

2.08 Clar.fication, and in some cases redefinition of, the lines ofresposibility between central and local authorities is required in order toincrease the effectiveness of urban management. There is a need to formalizeinformal procedures that are already in place as well as to codify new workingrelationships that reserve key roles for both KCC and central governmentagencies in the provision of services such as town planning. The role of RCswill also need to be included in this exercise. The Project will help clarifythe institutional framework affecting physical planning and valuation andrating (Paras. 3.09 and 3.14).

Financing Urban Services

2.09 Municipal Finance. The financial relationship between centralGovernment and urban authorities is basically set out under the Constitutionand the Urban Authorities Act of 1964. The Ministry of Local Government setsout guidelines to local authorities, exercises financial control throughbudgetary procedures, administrative instructions, and inspections (Para.5.09).

2.10 The majority of local revenues to finance urban services havetraditionally come from the graduated tax, the property rates, and centralgovernment block grants for recurrent expenditure. The significance of thesesources of revenue to Kampala's finances has been altered dramatically inrecent years. The deterioration of urban services and the non-evaluation ofproperties during a period of exceptional inflation since 1982 has severely

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eroded both the valus of the property rate and resident's willingness to pay.The cost of collecting property rates was estimated to be higher than theyield. The most prominent sources of local government revenue for Kampala aredescribed as follows:

2.11 Graduated Tax is a form of poll tax with varying rates of dues,depending on income, payable by all males over 18 and females in formalemployment. The minimum payment is U Sh 300 p.a. and the maximum U Sh 5000p.a. for individuals with annual incomes in excess of U Sh 47,050. It has ahigh collection rate because it is deducted at source for those in formalemployment, the payment card acts as a form of identification, and it is a taxwhich has been accepted by the public.

:.12 Property rates a property tax, now based on rental values, hasexisted in Uganda for many years. Recently the system has ceased to make anynet contribution to revenue in KCr due to a number of factors. The mostimportant two are the failure to revalue properties since 1982 and the factthat the law restricts the rate to 20 percent of the assessed values thuscurtailing any buoyancy of the system. There is much scope for improving theperformance of the rating system, possibily more than doubling the locallygenerated income due to KCC.

Urban Legislation

2.13 Laws governing the urban sector, with one exception, pre-date theliberation war of 1979. The principal acts include the Urban Authorities ActRevised 1964, the Public Land Act 1969, the Land Reform Decree 1975, the LandAcquisition Act 1965, the Town and Country Planning Act 1964 and the LocalGovernment Rating Decree 1979. "ie single major decree enacted since 1979 isthe Resistanre Councils and Committees Statute 1987. The principallegislative constraint on urhan development in Uganda is the complexity of theprocedures required for the allocation of land. This is exacerbated by thehighly centralized nature of the system and the breakdown of effective andefficient land surveying, titling and registration. Public land in urbanareas is allocated to local authorities by the Uganda Land Commission (ULC).Local authorities in turn allocate plots from this stock of public land on aleasehold basis in a complex process requiring as least a dozen intricate andexpensive steps. It has been estimated that less than 10 percent of theannual potential demand for land is satisfied under this system. About 8Z ofthe land in Kampala, Mailo land, is privately held with titles granted undercustomary rights. Attempts to convert such title into conventional leases andforce landowners to develop or forfeit their plots have so far failed. Mailoland changes hands at very high prices under a system of haphazard subdivjsionwhich creates a pattern of plot layout which is difficult and expensive toservice with physical infrastructure. This phenomenon is as true of high-income areas as it is c! low-income areas. Government is aware of theconstraints imposed by inefficient land administration procedures and hasengaged in a comprehensive review of all land matters with a view tobroadening the range of acceptable solutions for the allocation of land whichconfers security of tenure thus encouraging investment into housing and otherforms of real estate. (Para. 3.10).

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2.14 Legislation governing building construction, contained in thePublic Health Act 1969, zurrently under revision, differs markedly accordingto whether the construction will occur in a Planning Area or in a ResidentialSettlement Area. For Planning Areas, the law specifies in detail materialsand methods permitted for acceptable Grade I construction. The enforcement ofthese rules falls to the local authorities who, in theory, operate aconventional system for issuing building permits after comprchensive reviewsby various public offices. Owing to the stringency of this system, mostformal housing construction either ignores the system (all but 975 projects in1988) or occurs in Residential Settlement Areas or in recognized communitieswhere Grade II rules apply. Grade II rules are simpler, stated in the form ofperformance criteria, and are more flexible than those of grade Iconstruction. The development of housing on land serviced under the Projectwill be governed by grade II rules.

Present Housing and Service Standards in Kampala

2.15 Housing. It is estimated that about three quarters of Kampala'sresidents live in crowded, poorly serviced, mud-and-wattle settlements thatlack basic infrastructure and amenities. Poor access to these settlementsoften impedes the provision of services such as public transport and refusecollection. High rents, which start at about U Sh 5,000 per month for a 3m x3m mud-and wattle room with shared courtyard, cooking facilities and pitlatrine, without water or electricity on plot, induce crowding and indicate ahigh unsatisfied demand for serviced plots. In a survey of housing conditionsundertaken in 1989, nearly 40Z of Kampala's households occupied tenements orone-roomLd units in terraced blocks (muzigo) constructed of mud and wattle orconcrete block walls under metal roofs. The typical dwelling unit among thelow-income groups is one poorly ventilated room. Ovetcrowding is common withaverage room occupancy rates observed to be between 4.1 and 5.4 peopleoccupying a space of 14m2. Such overcrowding and the associated lack ofservices have led to incidences of typhoid and cholera in one family out oftwenty in the 6-month period preceding the 1989 survey.

2.16 Municipal Roads Network. Kampala's road network comprises about450 km of roads, of which about 270 km are surfaced. A large proportion ofthis network, however, is in an extremely bad state of disrepair and in manyinstances will have to be reconstructed. KCC, with EEC's assistance, has hadabout 41 km of roads rehabilitated or reconstruced since 1983. Further,improvements to the major roads is envisaged under Phase II of the EECprogram, involving 30 km of roads. Associated stormwater drains andfootpaths, as well as major drainage channels, have also been covered underthe EEC-financed road maintenance program. There is still an urgent need toestablish effective routine road maintenance services to preserve tho life ofthe existing unrehabilitated roadways and protect the investment in those morerecently brought up to standard. Street lighting is lacking in all but themajor thor ughfares, with consequent security risks to pedestrians.

2.17 Refuse Collection. Estimated solid waste generation is presently1,700 m3/day (760 tons/day), of which less than 202 is collected. Regularrefuse collection service is provided to less than 102 of the city's

population. Negligible amounts of waste are disposed of by commercial andindustrial establishments bringing their own refuse directly to the tippingground or contacting KCC's Cleansing Section for ad hoc removal. Householdwaste in Kampala typically contains 702-80Z wet, organic materia' whichdecomposes rapidly. Uncollected household waste is disposed of u gardens andvacant lots where it is used as animal feed, burnt, composted, buried ordecomposed in the open. The KCC office responsible for overall development,planning and coordination of the various cleansing activities is ill-equippedfor the task. The collection system consists of open, communal containers,and special vehicles equipped for lifting and transportation of containers.Collected waste is disposed of in uncontrolled landfills or dumps. KCC hasthree available disposal sites only one of which, Lugogo By-pass, is currentlyin operation. Lugogo By-pass has serious pollution problems: the waste blocksthe Lugogo Road and leachate flows on the street surface. All types of wasteare dumped indiscriminately, including hospital waste (syringes). The currentdisposal practice is hazardous to humans and animals, and is in generalunsightly. During the rainy season some of the major markets, as well as thedump sites become inaccessible to the collection vehicles, causing bothcollection and disposal problems.

2.18 Markets. Markets are managed by the City Treasurer's Departmentand now account for a significant proportion (27 percent) of municipalrevenues. This is despite the fact that the market sites lack proper access,drainage, hardstanding, water supply, electricity, security and generalamenities. There are more than 60 markets in Kampala with a total of over14,000 stalls. Not all of these markets are effectively administered by KCC.Spontaneous markets have sprung up since 1971 in response to the needs ofresidents and are strategically located throughout the city. Some operateonly at night or late in the afternoon and outside controls which may beenforced only during formal office hours.

2.19 Water Supply and Sanitation. Currently about one half ofKampala's population of 700,000 has access to a supply of treated water.About one third of total consumption is by means of public standpipes.Approximately 141 of Kampala's population is served by water-borne seweragesystems, 162 by septic tanks, and the remainder by traditional (often shared)pit latrines. Under IDA Credit 2124-UG for the Second Water Supply Project(US$60 million), levels of service are projected to incr :ase to 642 fortreated water supply and 192 for sewerage systems by 1996. The provision ofwater supply is, therefore, not proposed as a part of this Project.

C. Government Strategy for the Urban Sector

2.20 Besides the macro-economic constraints such as high inflationthere are a number of other factors which hamper development in the urbansector. The major constraints are financial and are related to the inadequacyof rates and taxes which were not adjusted to compensate for high inflation.Insufficient resources have contributed to the following problems: i)necessary equipment and materials for operation and maintenance could not beprovided; ii) low salaries led to shortage of qualified and experienced staff;iii) low morale of existing staff has made the country dependant on technicalassistance.

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2.21 GOU is aware of the problems but relieving these constraints willtake considerable time and effort. Restoring the loss of qualified manpowerwhich has taken place over the past 15 years will inevitably take years toaccomplish. Government policies for cost recovery for services are in placebut strengthening of the finance departments of the concerned institutions andupdating of consumer records will also take time.

2.22 Under the Rehabilitation and Development Plan (RDP) 1988189 -1991192 1/ GOU has established the goal to continue the rehabilitation ofsocial infrastructure, consolidate existing systems and expand (social)services in selected fields. In particular, in the sub-sector for urbandevelopment, Government's strdtegy is to promote an *enabling approach' byconcentrating on the removal of impediments that hinder housing development.GOU is to act as a facilitator, providing easier access to land, finance,inexpensive but durable building materials, and the planning and installationof infrastructure yet leaving the actual construction of shelter to theprivate sector. In addition, the RDP calls for support for physical andeconomic planning programs and the enforcement of town and district plans. Italso supports programs for the production of building materials.

D. Previous Sector Activities

2.23 Uganda's urban sector has not been the focus of major investmentfor many years. During the last 15 years, virtually no maintenance of urbanservices was carried out, much less improved upon. Indeed many of thefacilities were subject to looting and outright destruction. Since 1986, GOUhas recognized the important role played by the sector in the national economy(Para. 2.03) and has accordingly given priority to a number of reconstructionefforts with an urban focus. In 1981, Government established theReconstruction and Development Corporation (RDC) in order to speed up thereconstruction of the three municipalities of Masaka, Mbarara, and Arua thatsuffered most from the liberation war of 1979. Progress to date, impeded by alack of finance, includes the preparation of new development plans for thetowns asnd a limited amount of rehabilitation work in infrastructure, socialservices and pool housing mainly in Masaka.

2.24 Kampala has received greater attention in the form of 41 km. ofmajor road reconstruction financed by EDP and GOU. Under a second phase, EDFhas earmarked ECU 15 million to continue the program. In the housing sector,GOU has embarked upon a pilot urban area upgrading project with assistancefrom UNCHS (Habitat) and Shelter-Afrique. The project is expected to resultin improved infrastructure services and housing, security of tenure for low-income households and additional social services including a primary school.Government is also receiving assistance from UNCHS to formulate a nationalshelter strategy designed to identify housing needs and the resources requiredto meet them. Efforts to strengthen Kampala's ability to manage solid waste

1 Ministry of Planning & Economic Development, Rehabilitation andDevelopment Plan 1988/89 - 1991/92, Volume I, Second Edition, Kampala, Uganda,December 1989.

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have been assisted by a number of donors including IDA, EEC and GTZ. IDA hasprovided the services of a solid waste expert to assist with the management ofrefuse collection programs in the seven towns included in IDA's First WaterRehabilitation Project (Credit 1510-UG).

B. Rationale for IDA Involvement

2.25 IDA's country assistance strategy for Uganda supports theGovernment's economic recovery by helping to restore productive capacity whilesteering the economy towards sustainable long-term growth. The three mainelements of this strategy are: i) the restoration of macro-economic stability;ii) the rehabilitation of physical infrastructure ; and iii) theimplementation of structural reforms and investments in productive and humanresources to address longer-term development objectives.

2.26 The restoration of macro-economic stability will be to the benefitof the majority of Ugandans in the medium term. More resources will becomeavailable to rehabilitate basic social services such as primary health care,education, and water supplies. Employment opportunities in the urban areaswill be enhanced as industrial capacity utilization begins to improve. Withan improved economic climate, the enlarged inflow of foreign exchange andpolicies designed to stimulate a supply response in the economy, higher levelsof per capita consumption and enhanced social welfare are projected for themedium term. However, the short-run impact of the ERP, combined with the needfor Government direct resources towards addressing the political insurgenciesin the North, means that the needs of some of the worst victims of the periodof civil unrest and economic decline will not be met. These groups includethe urban poor living in dangerously unhealthy slum area of Kampala. Theproposed project, therefore, has as one of its objectives, the alleviation ofpoverty in Kampala.

2.27 Existing IDA credits are assisting in the rehabilitation ofessential infrastructure, viz., Highways III and IV, Railways I, Water SupplyI and II and Telecomnunications II. Operations under consideration includePower III, additional transport sector rehabilitation and a water supplyproject for small towns. The proposed project would be the third in a seriesdealing with the rehabilitation of local authority infrastructure but withemphasis on services other than water supply. The project includes componentswith significant impact on living conditions.

2.28 The project would support Uganda's aim to invest in human capitaldevelopment by financing the strengthening of government bodies at bothcentral and local levels. Such institutional development is necessary iflocal authorities are to resume the provision of social and infrastructureservices with minimal dependence on central government resources, bothfinancial and human.

2.29 The project would also act as a catalyst in attracting other donorsupport for the urban sector. The Nordic Development Fund (NDF) and GTZ haveindicated their intention to co-finance the proposed project.

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III. TIE PROJECT

A. Project Origin and Preparation

3.01 The proposed First Urban Project owes its origin to a series ofemergency water sapply and sewerage rehabilitation interventions in Uganda'sseven major towns. Major issues of urban finance and management wereidentified in a Bank sector report in 1984 11. Subsequently, funds wereincluded in a PPF request from the Uganda Government to cover the cost ofspecific feasibility studies covering priority action areas such as urbanfinance, rehabilitation of streets and drains, solid waste management, urbanmarkets, low-cost sanitation and serviced residential land. The low-costsanitation component has been included in the PAPSCA project (Credit 2088-UG),the program for the alleviation of poverty and social costs of adjustment.The expansion of Kampala's water supply and sewerage network is assuredthrough the IDA Second Water Supply and Sanitation Project (Credit 2124-UG).Health and hygiene education measures to complement the upgrading of the watersupply and sanitation services are included in the IDA Health Project (Credit1934-UG).

B. Project ObjecvAves

3.02 The proposed project would support the Government's efforts todecentralize responsibility for the planning, design and management of urbanservices to local authorities while assisting with reconstruction of thecountry after a period of political instability, social strife and physicaldestruction. The project would include the following objectives:

(a) improving living conditions and alleviating poverty in Kampala byrestoring key infrastructure services and related maintenanceactivities;

(b) improving urban financial management by i) strengthening therev-.ue base of KCC, and ii) promoting sound urban cost recoverypolicies;

(c) strengthening institutional capacity by i) supportingdecentralized local urban management; ii) increasing MLG'scapacity to assist local authorities to increase their revenuebase and strengthen financial management; and iii) increasingKCC's capacity to manage urban land development.

The project will help restore KCC's authority and standing with respect tomarkets administration, refuse collection and disposal, and the provision andmaintenance of infrastructure, particularly roads and storm drainage networks.KCC and PPD's capability to undertake urban land planning directly linked toinfrastructure investment programming will be enhanced. MLG's capacity to

I Uganda - Report on Urban Finance and Management, Report No. 5322-UG,September, 1985.

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extend improved financial management and administrative services to otherlocal authorities throughout Uganda will also be improved.

C. ProJect Description

3.03 The project comprises the improvement of urban services in Kampalaincluding the rehabilitation of the solid waste collection and disposalsystem, upgrading of urban markets, maintenance of urban roads, and provisionof infrastructure for self-help low cost housing. Besides funding for civilworks and the supply of goods, resources have also been included for trainingand technical assistance for strengthening the responsible institutions (MLG,KCC, IPA, and PPD) and improving their revenue base. The components listedbelow represent priority interventions in the areas of urban infrastructureand services. Detailed descriptions of the project components dnd relatedcost estimates are given in Annexes 1-8.

Rehabilitation of Infrastructure in Kampala

3.04 Urban Markets. The project will include the physical upgrading ofthree prototypical priority markets (Ovino, Natete, Bugolobi) that serve bothretail and wholesale functions. In view of their unsanitary conditions andtheir revenue generating potential, KCC attaches a high priority to thiscomponent. The improvements would include enhanced pedestrian and vehicularaccess, security perimeter walls and lighting, provision of water and sanitaryfacilities, and better stormwater drainage. Construction of market sheds,arcades and administration offices will also be undertaken. Vendors, inaddition to constructing their own lock-up stalls, will play a major role inthe day-to-day administration of the markets. In addition to the improvementof environmental conditions in the three protoypical markets, the project alsoprovides a set of site plans for six other priority markets. The designsinclude proposals for improved physical planning, infrastructure services, andaccommodation, the latter being based on standardized building types used inthe three prototypical markets. The project also includes funds for theprocurement of selected items of office equipment, furniture, vehicles andtools as well as limited technical assistance and training for KCC marketworkers at all levels of the management structure. (Annex 1).

3.05 Refuse Collection and Disposal. Priority efforts to rehabilitateKampala's solid waste management system will focus on i) improved utilizationof existing equipment including improved repair and maintenanceoperations; ii) better labor productivity; iii) establishment of a servicecharge system to strengthen financial resources; and iv) improved disposalsite conditions at the three disposal sites in Kampala. The Public CleansingSection undor the City Engineer will be consolidated and a financial baseestablished through the introduction of a revised tariff structure. Servicecoverage will be expanded according to consumers' willingness and ability topay. RCs will assist with mobilizing public participation in the program.The Lugogo By-pass disposal site will be provided with all-weather accessroads, a drainage system, and suitable equipment for landfill operations.Additional collection and disposal vehicles will be provided along withtransport for the inspectorate. An incinerator for hospital wastes will beinstalled at Mulago Hospital to increase Kampala's capacity to control the

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spread of infectious diseases, including AIDS. The municipal vehicle vorkshopwill be repaired and equipped to provide routine maintenance and servicing ofvehicles and equipment while major repairs will be undertaken by qualifiedprivate workshops. XCC personnel will be given training in systems planning.operations and maintenance. During negotiations it was agreed that DCC willhave defined and adopted an urban environmental policy statement with speclalattention to solid waste management by April 30, 1992; it was also agreed thatimprovement leading to an increase in the volume of waste disposed from 7,000m3 to 16,000mS per month would be achieved by the end of 1993 CPara. 8.03)(Annex 2).

3.06 Maintenance of Urban Roads, Storm Drains and Footpaths. Theproposed road maintenance program for Kampala will be a 3-year program aimedat strengthening KCC's road and drainage maintenance capacity while alsofinancing deferred, extraordinary maintenance of priority roads, drains andpedestrian footpaths. The program will begin in FY1992 after completioa ofEEC's 3-year program which ends in FY1991. The program sill consist ofmeasures for strengthening the maintenance organization, training of staff,technical equipment and supply of equipment, materials, tools and transport.Extraordinary (periodic) maintenance will be carried out by both local andInternational contractors. During negotiations it was agreed that ICC submitto IDA, by June 30 of 1991, 1992, and 1993, its proposed annual roadmainteanace program Sncluding an economic analysis for review (Para. 8.03).(Annex 3).

3.07 Rehabilitation of Selected Office/Workshop Accommodation. TheProject will include the refurbishing of the mwnicipal mechanical workshoplocated in Kampala on Sixth Street (Para. 3.05). During negotiations it wasconfirmed that KCC will undertake to send all municipal vehicles andmechanical equipment to private workshops for major repairs and servicing(Para. 8.03). Municipal depots in four of the six administrative districts ofKampala will be rehabilitated as part of the road maintenance program (Annex3). In order to provide suitable facilities for the training of central andlocal government workers, the Project will include the rehabilitation of anexisting building to accommodate the Local Government Resource Center at IPAand training rooms at KCC and MLG (Annex 7).

Urban Land Management

3.08 Uodated Topographical Mapping of Kampala. Kampala's base mapseries at 1:50,000 is largely based on aerial photography taken in the period1958-1962 and, therefore, essentially represents the status prior to someimportant infrastructure develowments, such as the construction of MukwanoRoad, the town center by-pass road. Because of changes in settlements and invegetation cover, the maps no longer furnish the background data required byplanners with the necessary degree of accuracy. The project will, therefore,provide funds to prepare new base maps based on aerial photography which wastaken in February 1990. The new maps will be used, in the first instance, toproduce outline structure plans and area development plans for Kampala (Annex4).

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3.09 Strenathening of Urban Investment Planning. The project willstrengthen the Physical Planning Department of the Ministry of Housing andUrban Development (MOHUD) and the Town Planning section within MCC. The goalwould be create a capacity to plan and evaluate urban investment proposals.The project aims to achieve this goal by financing a 2-year exercise of on-the-job training for planners, economists, engineers and financial analystsassisted by foreign and local expertise. The team is expected to produce up-dated outline structure plans for Kampala and Jinja together with detail orarea development plans justifying capital investments on technical,institutional, financial and socio-economic grounds. GTZ has agreed toparticipate in this activity. During project appraisal, agreement was reachedbetween MCC and MOHUD on a suitable modus operandi to enable effectivetraining of personnel involved in urban development planning: resources fromGTZ would flow to PPD while those from IDA would flow to RCC. This wasconfirmed during negotiations (Para. 8.03) (Annex 4).

3.10 Government has recently taken steps to address the bottleneckswhich affect mechanisms for administering land. The Comission of Inquiry onLand Matters which began its work in late 1989 and a related consultancylooking at the feasibility of rehabilitating the central land registry promiseto lead to major changes in the way land in Uganda is administered. (Para.2.13). The studies have included an examination of the issues relating toland survey, titling, land registration and the need for an integrated landInformation system. The project would provide short-term technical assistanceto up-date the Town and Country Planning Act (1964) which is based uponlegislation passed in the U.K. in 1947. The review would take into accountproposed changes in the administration of land as may be forthcoming as aresult of the Commission of Inquiry into Land Administration (Annex 4).

3.11 Provision of Serviced Residential Land. In order to beginaddressing the acute shortage of serviced plots within properly plannedresidential development areas, the project will finance the replanning andservicing of a partially developed 47 hectare site in Kawaala mostly owned byICC. The Project area was gazetted as an Action Area under the Town andCountry Planning Act 1964 on September 28, 1990. The scheme will provideabout 1,000 serviced plots with minimal but improvable infrastructureincluding roads, storm drains, water (75 percent at standpipes), and securitylighting/electricity. Most plots will be allocated to lower-income householdsfor development of core houses by means of self-help and informal sectorcredit. The most vulnerable groups will be assisted by the provision ofbuilding materials and block-and brick-making equipment, the latter to be usedby local cooperatives. Implementation of the scheme will be assisted throughthe active participation of the local RC structures. During negotiations itwas agreed with MCC that the operating expenses of the primary school to bebuilt at Kawaala will be adequately budgeted for (Para. 8.03). (Annex 5).

Urban Management

3.12 Uganda's municipalities have received very little assistance forstrengthening urban finance and management in the past. The shrinkingfinancial revenue base during a reriod of high inflation accelerated the decayof urban services and infrastructure and demoralized municipal staff. The

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project aims at reversing this trend in Xampala. Measures to improve thefinancial resource base will have the highest priority, including therevamping of Kampala's property tax system (Annex 6). It is recognized thatIncreased charges should. in some instances, be accompanied by visiblyImproved levels of service. Besides XCC, assistance will be provided to WLGto strengthen the local government inspectorate and to provide fiuancialmanagement and administrative training programs for other local authorities inUganda, as outlined below (Annexes 7 and 8).

3.13 Technical Assistance and Trainins to MLG: In support of HLG'sgoal to help Local Authorities Increase their revenue base and improve theirfimancial management and administrative systems generally, the project wouldinclude financing tot

(a) establish a management training and policy unit within the LocalGovernment Inspectorate to provide overall leadership to trainingand institutional development for local governments in Uganda.This unit will be responsible for establishing Training andInstitution Development (TID) policies for local governments,assessing needs, setting training priorities, garnering TIDresources, and monitoring and evaluating TID activities and theirimpact on local government performance;

(b) establish and equip a Local Government Resource Center (LGRC) onthe campus of the Institute of Public Administration (in abuilding which was originally donated to 6OU for that purpose).The Center would provide for the development of a full range ofdecentralized support services to local governments, includingstraining trainers; developing and printing training materials andoperational manuals; carrying out action research and consultingassignments in local authorities; acting as a secretariat to theAssociation of Urban Authorities; offering a full range ofdecentralized short courses and seminars for local officers;publishing a variety of news bulletins and other documents to keeplocal authorities informed; and acting as a facilitator forlinking programs between Uganda's local authorities and moremature local institutions in other countries. During negotiationsit was confirmed that the building on the IPA compound bedesignated the Local Government Training and Resource Center(Para. 8.03).

3.14 Long-term technical assistance advisors to be attached to MLGIIPAwould include the following:

Job Title Staff-months

Training and organizational specialist 24LGRC coordinator 24Media/design specialist 24

Total 72am

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3.15 Technical Assistance and Trainig to 1CCs The project aims tostrengthen ICC's general financial and personnel management systems andservice operations through:

(a) a linking arrangement with one or two mature local authorities,outside Uganda that can provide long and short-term technicalspecialists and practical attachments for NCC officers In speciflcoperational areas in need of improvement;

Sb) the creation and support of a training unit within XCC that canmobilize and manage a full range of human resource developmentprograms for ICC officials, officers and employees;

Cc) specialized consultations and technical assistance to the officeof the Town Clerk in municipal management, organizationdevelopment and the development of a personnel management system;

Sd) a wide range of short on-the-job, in-house and in-country trainingworkshops and programs in such areas as financial management,revenue collection, market operations, general management, first-line supervision, street maintenance and other areas, asidentified during the project preparation; and through a processof on-going needs assessment; and

(e) the provision of appropriate assistance in the form of transport,training, furniture and equipment and training aids.

During proJect appraisal agreement was reached with Government on a suitableapproach for the provision of human resources development within KCC using,inter alia, a twinning arrangement with another more mature local authority.

3.16 Long-term technical assistance advisors to be attached to RCCwuald include the followings

Job Title Staff-months

Municipal financial management specialist 24Revenuelaudit/computer specialist 12Organizational development specialist 12Personnel systems specialist 12Market management specialist 8Vehicle maintenance specialist 12Solid waste management specialist 12Low-income housing specialist 12Road maintenance specialist 12Valuation and training specialists (2) 60

Total 176

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Proiect PreUaration

3.17 The project also provides funds for the preparation of a possiblefree-standing IDA credit for a small towns water and sanitation project. Tbopreparatory activities would fall under the Water Development Department (V1W)of the Ministry of Water and Mineral Development. The project would focus onthe rehabilitation and expansion and now construction of water supplies andsanitation facilities in towns which are smaller than the seven towns includedin Second Water Supply Project (Credit 2124-UG). The preparatory activitieswould be designed to strengthen 1WDD to enable it to play an increased role inthe plamning, design, implementation and operation of small urban water supplyschemes Funding would be provided for technical assistance, consultingservices, provision of office equipment and transport (Annex 9).

D. Prolect Costs

3.18 The total project costs are estimated at US$38.5 million of whichUS$30.2 million or 782 represents the foreign exchange component. Theprovision for duties and taxes has been estimated at US$0.7 million. Basecosts are expressed at May 1990 prices. Summary project cost estimates areshown in Table 3.1 and detailed cost estimates are shown as part of theannexes describing the project components.

.. 18 -

UmNDA FIRST UBN PROJECT

Table 8.1

Projet Cot Estte.|

LoI For1ein ToOal X Toul

A. KCC INFRASTRUCTtRE REHABILTATION1. Urban markets 1.08 4.23 6.80 1432. Solid was Mnag t 1.59 8.70 5.20 143S. Streets and deains 1.43 4.47 5.90 lox

Sub-total A 4.00 12.40 10.49 43

B. UROAN LAND DEVMENT1. KCC mapping 0.00 1.06 1.05 ox2. Urban development planning 0.16 1.23 1.40 45S. Kawala sites A service 0.97 8.16 4.10 llX

sub-totel 1.1S 5.51 0.60 173

C. URBAN MANAGEMNT1. KCC TA/tralning/equip 0.42 2.99 8.40 oX2. IIL TA/training/quip 0.06 0.68 1.40 4X

sub-total C 1.07 8.02 4.69 1s1

D. PROECT PREPARATION1. Small Town Water Supply 0.11 0.02 0.78 2X2. PPF Refinancing 0.00 1.50 2.50 4X

Sub-total D 0.11 2.12 2.28 OX

TOTAL BASE COSTS 0.48 28.U 80.20 7?X

E. CONTDIEIES1. Physical (101) 0.64 2.23 2.60 7X2. Price 1/ 1.27 4.07 6.84 14X

Sub-total E 1.91 6.81 0.22 21X

TOTAL PROJECT COSTS 0.84 80.10 86.50 1O00

TOTAL PROJECT COST EXCUWINC TAXES ?.57 80.10 87.78

1/ E _pce price lncrease (X) on categories A, S. C, ad .1:

1960 1991 162 1068 104 195 1906

Local und Foreign 4.0 4.9 4.9 4.9 4.0 4.0 3.7

Note: International pric coatiagsncy rates have bees usd tor local costs e the ass*uptionthat the differenc betwen doestic and internotional price intlation willbe offst by adjustments In the foreign exchang rate.

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3.19 The estimated c::t of rehabilitating the three selected urbanmarkets was based on detailed working drawings and draft tender documentsprepared by consultants and adjusted by Association staff. Project costs forthe up-grading of refuse tips to sanitary landfill standards were estimated bythe KCC with the assistance of consultants or the basis of preliminaryengineering designs. The estimated cost of urban road maintenance was basedon rates recorded under currint road maintenance activities and recenttendering carried out by EEC for their 1990191 road maintenanee program.Project costs for the Kawaala sites and services scheme were based onpreliminary engineering designs prepared by consultants.

3.20 The consultant services to be provided by foreign and localprofessional specialists are estimated to cost US$15,000 and US$4,000 perperson-month (inclusive of transport and housing) respectively. The estimatedmonthly cost of foreign technician assistance has been estimated to beUS$12,000. The monthly cost of training through overseas attachment has beenassessed at US$4,000. The cost of engineering supervision services has beenassessed at 5 of the cost of the civil and building works.

3.21 Physical contingencies are estimated at lOZ of base costs,excluding land. Price contingencies to provide for anticipated cost increasesover the implementation period are based on an annual price increase of 4.9Zfor the years 1990 to 1995 inclusive and 3.7Z for 1996. The internationalrate has also been used for local costs on the assumption that the differencebetween domestic and international price inflation will be offset byadjustments in the foreign exchange rate.

K. Proiect Financina

3.22 It is proposed that IDA finance US$28.7 million or 75Z of totalproject costs net of t%xes. NDF has agreed, in principle, to contributeUS$4.6 million in support of strengthening urban management at MLG and RCC(Paras. 3.13 - 3.16). GTZ has agreed to co-finance the strengthening of thephysical planning capacity of MOHUD and KCC (Para. 3.09) ir the amount ofUS$0.6 million. The balance of US$4.6 million, all local costs, would befinanced in equal measure by the GOU and KCC. The financing plan issummarized in Table 3.2 below.

Table 3.2

Total Proiect Financins(US$ million)

Local Foreign Total Financing asZ of Total

IDA 2.58 26.12 28.70 752NDF 1.10 3.50 4.60 122GTZ 0.06 0.54 0.60 22Government/XCC 4.60 0.00 4.60 122

Total 8.34 30.16 38.50 1002-x _ _

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IV. PROJ D

A. The Borrower and On-lend-Ina Arranements

4.01 The ID& credit of US$28.7 million would be made available to 6OUat the standard IDA terms with a maturity of 40 years including 10 yearsgrace. The proceeds of the IDA credit would be passed on to the variousImplementing agencies as loans and grants according to their respectiveabilities to recover the capital costs of the project and the strength oftheir respective financial positions. GOU would bear the foreign exchangerisk of the Credit.

4.02 About US$21.2 million of the IDA credit will be passed on to ICCas a loan to suppott the financing of capital c.sts, including marketupgrading, refuse removal refurbishing, implementing the Kawaala sites andservices scheme and executing road maintenance, all items for which viablecost recovery approaches exist through user charges, property tax orbeneficiary loan repayments. The IDA on-lending would be made at an annualInterest rate of 21 repayable over 25 years with a 5-year grace period.The terms are justifiable on the grounds that KCC is not a profit-earningentity. Concessional lending terms are essential at this time to providethe opportunity for the Council to begin to regain a strong financial base.The terms also permit RCC to carry out limited capital development worksfrom its own resources since the IDA credit does not cater for allInvestment needs during the period 1991-1997. At the same time, the termsavoid the provision of an outright grant, thereby creating an incentive forthe reestablishment of financial discipline over the long term. Completionof the subsidiary loan agreement between Government and ICC would berequired as a condition of credit effectiveness (Para. 8.05). For theremaining ICC components for which the capital costs cannot be recovereddirectly from beneficiaries, about US$4.5 million of the IDA credit wouldbe passed on as budgetary allocations to KCC throw^ NWLG. These componentsinclude technical assistance and a limited amount f p.ofessional andtechnical equipments

4.03 For the other project agencies, including MEG and VDD, whichwould receive technical assistance and training under the project, aboutUS$3.0 million of the IDA credit would be passed on as grants and budgetaryallocations. This amount also includes US$1.3 million for the preparationof topographical base maps of Kampala.

4.04 The Nordic Development Fund (NDF) and GTZ have indicated aninterest in providing US$4.6 million and US$0.6 million respectively. Theallocation of the NDP contribution to provide technical assistance andtraining for urban mnagement was confirmed during negotiations (Paras.3.13 and 3.14). The NDF funds will be provided on terms essentiallyidentical to an IDA Credit, i.e., 40 years maturity, 10 years grace andzero interest. GTZ grat funds will be managed directly by GTZ in thecourse of contributing to the strengthening of urban investment planningcomponent (Para. 3.09). The fulfillment of conditions of effectiveness ofcredits and grants from 3D? and GTZ will be a condition of the IDA Crediteffectiveness (Para. 8.05).

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S. Institutional Araa _ts for lozlfeation

4.05 Overall implemntation responsibilities for the rehabilitationof municipal infrastructure, the provlsion of serviced residential land,the preparation of an urban investment program and the strengthening ofRampala's urban management would rest with KCC under the direction of theTown Clerk. Overall lmplementation responsibility for the strengthening ofphysical planning would lie jointly with KCC and PPD of MORUD.Implementation responsibilities for the strengthening of local governmentfinancial managemnt would lie vith MLG, under the direction of theCommissioner of Urban Affairs. Day-to-day assistance for projectimplementation, particularly as regards procurement, disbursement andprogress reporting, would be provided by the Project Coordination Unitunder MPED (Para. 5.27). During Project appraisal agreement was reachedwith Government that key staff, advisors and technical assistance will beappointed in all affected sections of MLG, KCC, and PCU. This wasconfirmed during negotiations (Para.8.03).

C. Procurement

4.06 Procurement arrangements are summarized in Table 4.1 below.

Table 4.1

8uy o Prsu,b Uthids 1/

P""eiN.sb Ut. IS 1* is 0*. VI tt-fla.... 41 T.t.i

KC 1804 0.14 1OU.84

)- 0.U 0.0@88 o.us.' I 10" *.1.~~~~~~~~~~~~~~~~~~~~o.sRead got Iuis .I Odin$ owlel.

in 0~~~~~.M7 0.47V4616146' I*lp=Ao Toole(0GA?) (.0)6

UK .86 0o.1 v.ss(7.86) ~~~0.1) (7.04)

MA 0.48 0.04 0.47(0.48) 0.04) (0.41)

Cma.taa 8.,., TA. Teatlal.

100t.58 8.14 1.04(8.58 (8.58)

W V 1.8 140 2.48(1.814) (-1.1)

la 0.0 0.0

poC 0.04 0.08

%1,045 _. 1.81 0.M 0.04 $.a 68.5 88.80(1101) 5.51)0 0.10) (5.10 (1610

1I Pip. 1.I be.abst. am . th Awelve Iut flhsuesi by SM4.91 SIceab Pabs.s, hlrlaN t O..lt Wst aid l..d .OPApemSaU..SI Lald eb KamN is fa.1 aid smlaes adbm.4, ""Gl kuslegmat Plud aid WUI; MPraurm by Nwrdi 4ampebitive bdilq.SI CuSe at SWAMPM ="I as lleatdt WAi'

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4.07 All civil works valued at a total of US$18.6 million includingcontingencies will be carried out by contract. A total of 8 contracts forthe rehabilitation of the markets, periodic road maintenance, upgrading ofsanitary landfill sites, the servicing of land at Kawaala and theconstruction of Kawaala's primary school, worth US$17.9 million, will beprocured by ICB. For this purpose, the Borrower will use Bank samplebidding documents for works (September 1985). Contractors for the twolargest contracts, urban markets and Kawaala land servicing, will be pre-qualified before inviting bids. A detailed schedule of all contracts inexcess of US$O.l million is given in Annex 10. All contracts in excess ofUS$0.30 -million will be subject to prior review by IDA, representing 85Z ofall disbursements.

4.08 Contracts required to rehabilitate a KCC training facility, fourroad maintenance depots, the Sixth Street workshop and an MLG trainingoffice are small (less than US$0.1 million each) and will be unlikely toattract international bidders. Therefore, these works will be procured bylocal competitive bidding in accordance with Government proceduressatisfactory to the Association. The assessment of LCB procedures inUganda is still to be made and until this is completed, LCB procedures tobe followed require advertising, public bid opening, establishment ofevaluation criteria, contract award to the lowest evaluated responsivebidder and non-exclusion of foreign bidders from participation. The firstLCB document to be financed under the project will therefore be reviewed byIDA to ensure that these requirements have been met.

4.09 Road maintenance materials (cement, steel, and spare parts,etc.), estimated to cost US$0.3 million including contingencies, buildingmaterials for self-help house construction at Kawaala, estimated to costUS$0.38 million, and the supply of professional equipment, tools andtraining aids, estimated to cost US$0.2 million, will be procured throughInternational shopping by calling quotations from not less than threesuppliers from at least two countries. The maximum contract value would beUS$90,000.

4.10 Supply of passenger vehicles, pick-up trucks, vans, refusecollection vehicles, including appurtenant containers, landfill equipmentand road maintenance equipment and spare parts, estimated to cost US$8.2million including contingencies, shall be procured through ICB inaccordance with Bank Guidelines for procurement. Contracts for vehiclesand equipment will be grouped in bidding packages, of not less thanUS$300,000 in value, according to the type or similar types of vehicles andequipment. To be eligible, the equipment suppliers will be required toprovide an adequate organization and maintain a reasonable inventory ofspare parts in Uganda. They will also be required to provide training ofmechanics and plant operators. Refuse containers, estimated to cost US$2.7million, are fabricated locally and will be procured by LCB in annual lotsover six years, provided that the quantity, quality and cost are shown tobe comparable with estimates from international vehicle and equipmentmanufacturers/suppliers. A small number of passenger vehicles required forproject start-up and valued at US$0.2 million will be procured through

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international shopping by calling quotations from not less than threesuppliers from at least two countries.

4.11 Technical assistance for further project preparation andsupervision, including detailed engineering design of landfill sites,supervision of market upgrading and servicing of Kawaala land will be doneby consultants retained under procedures outlined in Bank guidelines.

4.12 Technical assistance and training to strengthen KCC managementand administration, estimated to cost US$3.5 million includingcontingencies, will be employed using a twinning or linking arrangementswith more mature local authority organizations in another part of theworld. During appraisal the feasibility of providing operational technicalassistance to KCC for solid waste management, urban markets, and streetmaintenance estimated to cost US$1.4 million, through the same twinningarrangement was established as being cost effective and provided forconsiderable flexibility. Technical assistance and training for MLG,estimated to cost US$1.1 million including contingencies, will also beundertaken through a linking arrangement with a training organization whichwould establish a local government resource center at IPA (Paras. 3.13 and3.14). This component of the project would be financed by NDF.

D. Disbursement

4.13 The proceeds of the IDA credit would be disbursed as follows:

Mi) 75 percent of total expenditures for civil works;

(ii) 100 percent of total expenditure for vehicles, equipment,tools and training aids; and

(iii) 100 percent of total expenditure for consultants services,technical assistance and training.

4.14 All disbursements will be fully documented except for paymentsagainst contracts valued at less than US$10,000 equivalent which would bedisbursed on the basis of statements of expenses (SOEs). Supportingdocuments for amounts withdrawn on the basis of SOEs would be madeavailable for review by auditors and visiting Bank missions.

4.15 To expedite and facilitate disbursements, it was agreed duringnegotiations that PCU, through MLG, would establish a separate SpecialAccount in a local commercial bank with an initial deposit of US$300,000(Para. 8.03).

4.16 It was also agreed that &CC would establish an Advance Account inUganda shillings with an initial deposit of US$27,000 equivaluat tofacilitate disbursement in local currency to cover local costs. GOU willalso contribute an initial amount of US$27,000 to the Advance Account'Para. 8.03).

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4.17 The schedule of estimated IDA disbursements, expected to becompleted by June 30, 1998; is shown in Annex 11. The disbursementestimates are based on the project implementation schedule and on thetypical disbursement profile for urban projects in Bastern Africa.

L. Implementation Schedule

4.18 Annex 12 indicates the phasing of the implementation of each ofthe project components. The bulk of the infrastructure works are plannedfor 1991, 1992, and 1993. The implementation schedule for all Projectcomponents (Annex 12) and project progress reporting requirements wereagreed with Government during appraisal and were confirmed duringnegotiations (Para. 8.03).

F. Land Acquisition and Plot Allocation

4.19 Portions of the market sites slated for improvement are currentlyowned or leased ;y individuals. KCC has initiated discussions andnegotiations for their acquisition. Parcels of land required for theproject would have to be acquired prior to loan disbursement. In the caseof the proposed site adjacent to the Ovino market, currently used as a carpark but owned by the Trustees of the Nakivubu Memorial Stadium, RCC is toenter into an agreement for its improvement and use. The site slated forresidential plots development at Kawaala, though mostly KCC land, has about46 identified leases registered in the name of various individuals. Priorto negotiations Government prepared and submitted to IDA a list of land tobe compulsorily acquired in the interest of the project and had confirmedthe availability of the land required (Para. 8.01).

4.20 Agreement was reached with Government that as a condition ofdisbursement of the relevant categories, all land required for the Project(markets, land development at Kawaala) will held in legal title by ZCC andthat appropriate resettlement and compensation will be granted to currentlegal occupants (Para. 8.04). GOU will submit conformed copies of therelevant land titles for review by IDA prior to the disbursement of fundsin respect of the affected project components. The involuntaryresettlement and compensation program will include a timetable forcompensation, priority allocation of plots to bona fide occupants inKawaala to be moved under the proposed project, and a plan to relocate bonafide vendors who will be moved around/from Owino market as a result of thereduction in number of stalls.

4.21 During appraisal it was agreed that XCC will allocate servicedresidential plots within the Rawaala sites and services scheme to heads ofhouseholds who meet the following allocation criteria. This was confirmedduring negotiations (Para. 8.03)s

(a) are citizens of Uganda of at least 21 years of age;

(b) have regular incomes, not exceeding U Sh 100,000 perhousehold per month (May 1990 prices);

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(c) have resided in greater Kampala for at least two years; and

(d) do not already own a site or house in Kampala (except thoseheads of household which already have a plot in the Kawaalaproject area which would be eligible to apply for substituteland vithin the scheme, even if such households hold a site(a) outside of Kawaala).

Allocations will be made using a standard agreement acceptable to theAssociation.

. Prolect MRoitorla. Accountina. Auditing

4.22 Project accounts will be maintained by PCU on behalf of ICC andMLB with separate accounts for each element of their respective componentsand will be available for inspection by InA supervision missions. Allproject accounts will be audited by an auditing firm acceptable to theAssociation. The auditor's opinion will be required to contain a specialreference to SOEs (Para. 4.13) confirming that the claimed expenditureswere used for the purpose for which they were intended. Government willsubmit certified copies of such accounts and annual audit reports to theAssociation not later than six months after the end of each fiscal year

4.23 Each project implementing agency will prepare quarterly reports ina format acceptable to the Association and Including the information setout in Annex 13. Such reports will be combined into a single report by PCUfor submission to IDA. IDA will undertake supervision miesions at regularintervals according to the Supervision Plan included in Annex 13.

4.24 An agreement was reached with Government that a completion report,In a form acceptable to the Association, will be prepared and submitted notlater than six months after the closing date of the Credit (Para. 8.03).

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V. ANALYSIS OF PROJECT IAEPLD(BUTIRO AQICIES

A. Kamaala City Council

5.01 Functions of MCC. ICC is required to fulfill the followingmandatory functions under the terms of Section 29 of the Urban Authorities Act1964:

(a) control, manage, and administer the Urban Area;(b) safeguard public health;(c) develop, control, and manage land taken on lease from the Uganda

Land Commission including any housing estates thereon;(d) administer primary schools and homecraft centers; and(e) administer such medical and health services as the Minister may,

by statutory instrument, declare.

In addition, as the country's largest urban authority, it also has a number ofpermissive functions including the I) provision, operation and maintenance ofpublic facilities including markets, sanitary services for the removal ofrefuse and roads; ii) establishment of housing schemes including the servicingof land and the sale or leasing of plots; iii) administration of town andcountry planning schemes in any area within two miles of the urban boundaries;iv) advancing of money on the security of immovable property for the purposeof enabling persons to acquire land and build dwellings; and v) recovery ofcosts for municipal services rendered at rates approved by the Minister ofLocal Government. Section 53 of the Act gives powers to KCC to raise loans insuch amounts and on such conditions as the Minister of Local Government mayapprove.

5.02 Organization and Management. The highest deliberative body of thecity is the Kampala City Resistance Council composed of 72 elected membersfrom five sub-county or divisional areas (Xawempe, Central, Rubaga, Nakawa andMakindye) and two divisions representing Makerere University and KyambogoTraining Institute. Each area has its own Resistance Council (RC) made up ofelected members from constituent administrative parishes, each in turnrepresented by RCs composed of members from the 'village' or neighborhoodlevel.

5.03 The administration of KCC is headed by a town clerk who directsthe activities of five departments, each headed by a Chief Officer. Thefunctions of each department are as follows (See Chart 1 - KCC OrganizationChart)s

(a) Administration (Deputy Town Clerk):

(i) internal administration including personnel management,training, field administration, committee work and supportservices;

(ii) external matters including public relations, legal matters,security and administration of public housing estatesestablished by the Council;

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(b) Engineering & Survey (City Engineer and Surveyor)s

(i) operations including building inspeetion, drainage andcleansing, refuse collection and disposal, inspection ofworks, maintenance of city electrical services, trafficmanagement and maintenance of mechanical transport andplant;

(ii) town planning including preparation of detailed schemes andenforcement of planning regulations;

(iii) technical vatters relating to the design and construction ofinfrastructure, buildings, horticulture and stone quarrying.

(c) Finance (City Treasurer)s

(i) internal audit; purchasing and stores; graduated tax;property valuation and rates; accountancy; marketsadministration; car parks; expenditure; budgets; computer &programming:

(d) Public Health (Medical Officer of Health):

ti) preventive health matters including health education,inspection of abattoirs, markets, cemeteries, water drainsand vector control;

(ii) curative health matters including of running 6 municipalclinics and provision of services to municipal schools; and

(e) Education (Chief Education Officer)s

Ci) development, equipping and operating and maintaining ofprimary schools in the municipality. (Notes staff paid byMinistry of Education).

5.04 The total establishment of RCC includes 2,643 posts of which 1,166are filled. Table 5.1 shows filled and unfilled established posts byDepartment. Of the 54 posts established at principal officer level and above,only 12 are filled, leaving 42 senior posts vacant or manned in an actingcapacity. The council also employs about 3,000 casual laborers. The numberof vacant posts is a measure of the low level of remuneration earned by KCCemployees, with professional technical grades earning U Sh 2000 - 3000 (US$50-70) per month, supplemented by allowances of a similar order of magnitude.XCC's effectiveness and productivity are low because of the large number ofvacancies and the low level of salaries. The project will finance a review ofthe present personnel system with a view to establishing a structure with ahuman resource development bias that can help KCC attract, retain, motivate,compensate and develop a mature, dedicated cadre of individuals to serve theneeds of the organization and the citizens of the city (Annex 8).

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Table S.1ICC Establishment

Department Filled 2 Unfilled S Total

Town Clerk 408 48 432 52 840City Treasurer 324 59 229 41 553City Zducation 53 27 145 73 198Public Health 229 42 306 58 535City Engineer 142 30 337 70 479Audit 10 27 28 73 38

Total 1166 44 1477 56 2643

5.05 Manpower Development, Training and Technical Assistance. The newmanagement team which took up positions in early 1989 has prepared proposalsto change the management approach from day-to-day reactions to problems toplanned, time-specific actions. While the Town Clerk and his colleagues seephysical under-equipment as their largest handicap, they also see the need forassistance In establishing modern management methods with data gathering,infomation analysis, am!'agement information systems and vork programs tor theshort, medium and long term. Their preference is for training of old and newpersonnel in order to improve performance, with costly technical assistanceconcentrated in a few key areas. A limited number of areas requiringfinancial and technical expertise to strengthen physical program compoaentshave been identified to encourage gradual improvements of staff performancethrough bands-on training. A training arrangement with a well managedmunicipality will be appropriate to mobilize an interacting group of expertsrather than individuals. Improvement of ICC's financial resources andmanagement expenditure control is essential to ICC's future. Rence financialexpertise is among the most important technical assistance proposed. Duringnegotiations agreement was obtained that the municipal financial managementspecialist for iCC will be in post as a condition of credit effectiveness(Para. 8.05).

5.06 Accounts and Audit. MCC financial accounting is of very poorquality. The flow of information within the Finance Department isinsufficient and there is very little feedback from KCC management to theaccounts, making accountability difficult. The original accounting system hasdeteriorated over the years through the gradual erosion of basic controls andcompetence. XCC's last statement of audited accounts produced withoutexternal assistance was for pY1979 11. Since then no further final accountshave been established. Consultants, funded by IDA, attempted to reconstructaccounts for mY1987 and PY1988. The preparation of PY1987 accounts provedipossible owing to the loss of documentation, i.e., documents of originalentry, journals, ledgers, NCM machine posting proofs, and the lack of control

1 DCC's financial year begins on 1 October, three months after thebeginning of central Government's financial year.

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accounts. In addition, there was considerable confusion and a number oferrors in the treatment of the 1987 devaluation. The accounts for FY1988/89have been reconstructed and. balanced but there are several outstanding itemsto be resolved before finalization.

5.07 Despite the current difficulties, a certain improvement in 1989 isvisible (Paras. 6.10-6.15). In close cooperation with the office of the TownClerk and the Council, the management of the Finance Department addresseditself to the problem of the need for qualified and experienced personnel inkey positions. Accordingly, recruitment and selection of staff was undertakenin FY1989. In addition, a new departmental structure was introduced with 10divisions as shown in Chart 1. An additional post of Deputy City Treasurer incharge of revenue and expenditure with five other officers reporting directlyto him was established. The original Deputy City Treasurer, left with threeofficers under his direct control, runs the administration of the Department.The Internal Audit Division was given the status of Department and its head,the Chief Internal Auditor, reports directly to the Town Clerk.

5.08 Billing and Collection. Billing and collection procedures aredifferent according to the nature of the fees and charges. Some examples aregiven below:

(a) Graduated Tax - Tax payable by salaried workers is deductedat the source and paid directly by employers to 85 KCCagents and an equal number of assistants located at KCCrevenue collection offices. Self-employed individuals areassessed by Chiefs and Committees. Five enforcementofficers, assisted by 150 enforcement assistants, requestreceipts of payment of Graduated Tax form individuals (Para.2.11).

(b) Rates - Claim bills are delivered by Demand Note Servers onthe basis of the valuation list. The bills are sent halfyearly for the periods January-June and July to December.As these periods do not coincide with the Financial Year(October-September) a relevant correction should be done.There are about 60 Demand Note Servers in the rates section(Para. 2.12).

(c) Ground Rents - Bills are sent only if the amount is U Sh10,000 and more. Difficulties are created by the lack ofreliable mailing addresses and the low assessment in manycases.

(d) Markets - Dues are collected daily according to goodsdelivered. Rent is collected monthly. Collection of duesand rent is done by inspectors.

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B. Ministry of Local Government

5.09 Through the Urban Authorities Act 1964 and various administrativeprocedures, the national government exercises considerable control over thefinancial management of local authorities. MLG has primary supervisorycontrol over council finances and is responsible for:

(a) Allocation of block grants to councilst(b) Establishment of financial policies and directions through

budgetary control procedures;(c) Review of monthly financial reports prepared by councils;(d) Inspection and audit of council development plans;(e) Establishment and enforcement of council accounting practices;(f) Appointment (by the Minister) of city, municipal, and town

Councilors, in cases where the minister decides that Councilorswill not be chosen by elections;

(g) Management of the Local Authorities Loan Fund (Para. 2.05).

5.10 The functions of MLG are carried out by the Inspectorate,Engineering, Medical, Planning, and Administration and EstablishmentDepartments, all stationed at MLG headquarters in Kampala. The overseeing oflocal authorities in the field is undertaken at the District level. While intheory MLG has an important function in supervising and enhancing localauthority financial management, its role in practice has been largelyineffective. Like the urban authorities it is supposed to supervise, itsuffers from a serious lack of trained management and technical staff,equipment, supplies, transport and budget allocations. As a consequence mostof its responsibilities enumerated above are not done with the effectivenessthey require. There is, therefore, a need to provide technical assistance,training and commodity support for MLG under the project, with priority givento strengthening the financial management of local authorities.

C. Physical Planninx Department

5.11 Uganda's institutional capacity for physical planning lies withinthe Ministry of Housing and Urban Development (MOHUD) as a result of aministry reorganization in 1981. The structure of the Physical PlanningDepartment drawn up in 1981 included the provision for 63 posts under a ChiefPlanner in three sections, one each for urban planning, regional planning, andresearch. It has never been officially implemented and the capacity of theunit, staffed by less than 20 people, has been severely constrained by adesperate lack of resources. What little capacity exists is hampered by theshortcomings of the regulations and procedures governing the preparation ofurban land use plans: i) the assumption of spatial determinism; ii) the lackof investment planning accompanying the physical design stage; and iii) theisolation of the urban authorities from plan preparation. In 1989 RCC beganthe process of establishing a Town Planning Department, separate from the CityEngineer's Department, staffed with one planner seconded from PPD and a landsurveyor. Both PPD and RCC's capacity for urban investment planning will bestrengthened under the Project (Para. 3.09).

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D. Institute of Public Adminstration

5.12 The Institute of Public Administration was formed in 1967 and isthe basic training agency for Ugandan civil servants including those servingin local governments. While it is under the supervision of the Ministry ofPublic Service and Cabinet Affairs, there have been recent discussions withinGovernment of making it an autonomous parastatal with more self-financingresponsibilities. IPA started as a local government training instituteoperating in a building on its present site that was donated by a localbusiness and used as its training venue. Central government training wasadded later when the facility was expanded, through outside donor support, toinclude hostels for 150 residential students and classroom facilities toaccommodete 250.

5.13 By the end of 1982, IPA had trained nearly 16,000 governmentofficials and officers but some of the courses were dismantled in the mid-1980's and IPA, for this and other reasons fell, on hard times until recently.In 1987 the British government gave IPA a major grant to undertake a muchneeded renovation of its physical plant and continues to invest in long termtraining opportunities for its younger teaching staff. Phase II of theinfrastructure program is under consideration by the British Government andwill include continued renovation of the main facilities and staff housing.The one facility not included in their plans is the Annex which would berenovated under the project so it could be utilized as a local governmentresource center.

5.14 IPA started a residential diploma course in local governmentAdministration in 1984 patterned after several other diploma programs itcontinues to offer. This nine month course has since decreased in its abilityto attract quality students and only 15 are in attendance this program year.IPA's most popular course is one which is sponsored by the British Governmentand co-directed by Makerere University and Glasgow Polytechnic. This threemonths cor.rse, started in 1984, is directed toward senior governmentaccounting and auditing officers. Out of the thirty participants enrolled inthe course this year, nearly half are from local governments. The topstudents each year are attached to Strathclyde Regional College where theyalso attend a "training of trainers' course conducted by London College.Three of XCC's senior officers are graduates of the course and were alsoinvolved in the Strathclyde attachments.

5.15 IPA currently has 40 established teaching posts, of which 15 arevacant, and a supporting staff of 30. Six of the 25 faculty members arespecialists in local government finance, administration and development. Theinstitution also benefitted from the recent World Bank Public ServicePerformance Improvement Project with a purchase of much needed printingequipment. This printing capability will be a valuable asset in setting upany decentralized local government training program in Uganda.

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S. ProJect Coordination Unit

5.16 In order to prepare and implement the first IDA-financed WaterSupply Project (Credit 1510-UG), a temporary Project Coordination Unit (PCU)was set up under the Ministry of Mineral and Water Development. It proved tobe instrumental in the smooth execution of the project and now consists ofstaff with experience in administering Bank projects. It has been agreed withGovernmenu that the PCU should serve the same purpose for the Second WaterSupply Project as well as the proposed First Urban Project, providing itsservices not only for IDA but also for all other donors participating in theprojects. In recognition of the multi-sectoral concern of these new projects,the PCU has been transferred directly under the Ministry of Planning andEconomic Development. The PCU works closely with the concerned ministries,departments and agencies, handing over project-related tasks as and when theycan be managed by the responsible party.

5.17. The PCU is fully staffed (with the exception of a municipalengineer) and is responsible for procurement of works, goods and consultantservices, evaluation of bids, review of studies, assistance in obtainingimport licenses, work permits, checking of invoices and preparation ofdisbursement applications, monitoring project funds and reporting. It willkeep project expenditure accounts, separately for each credit-receivinginstitution and will have these accounts audited. The PCU reports to theMinistry of Planning and Economic Development and is controlled by a steeringcommittee which consists of representatives of ministries involved in theProject (Chart 2). It was agreed that a municipal engineer to the PCUsatisfactory to the Association would be in post as a condition ofeffectiveness (Para. 8.05). Funds for the municipal engineer have beenincluded in the Second Water Supply Project (Credit 2124-UG).

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VI. FINCIAL AMWLYSIS

A. Past and Present Financial Performance of BCC

6.01 Analysis of the past financial performance of KCC is hampered by thelack of basic accounting data (Para. 5.06). Nevertheless, an approximatestatement of affairs for FY1988, FY1989 and FYl990 is shown in Table 6.1below.

Table 6.1Summary of Financial Statements

(U Sh '000's)

FY 1988 FY 1989 FY 1990

Operating Income 351,000 875,000 1,606,000Operating Costs 276,000 754,000 1,606,000Operating Surplus for year 75,000 121,000Less:Cash not banked and unrecordedtransfers from bank 55,000 -

Total Surplus 20,000 121,000

Net Fixed Assets 14,289,000 14,114,000 13,965,000Current Assets 38,000 324,000 112,000Current Liabilities 47,000 241,000 29,000Net Current Assets (9,000) 83,000 83,000

Total Assets 14,289,000 14,197,000 14,048,000

Sources Consultants estimates

6.02 The revenue base in the past has been very weak; estimated revenuesfor PY1987 amounted to only U Sh 65 million, or U Sh 92 per capita, increasingto an estimated U Sh 351 million in FY1988. Major reasons for the low levelof revenues weres (a) inadequacy of the accounting procedures and lack ofcontrols in KCC; (b) very poor collection performance; (c) lack of qualifiedmanpower to run KCC's divisions; and (d) no revaluation of properties since1982 and consequently values, forming the basis for the rating system, werecompletely out of date.

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6.03 In FY1989, revenue collection increased to U Sh 875 million, therebydoubling the amount estimated in the budget for the financial year. Sincethere were no increases in rates, charges and dues, the increase in revenuecan be attributed to the employment of more qualified personnel in key postswithin the Finance Department, as well as higher efficiency in billing andcollection, the reorganization of revenue-generating taxi parks, and improvedmarket administration.

6.04 Further improvements are expected to be achieved during PY1990,with estimated total revenues increasing to U Sh 1,606 million. The originalincome estimates for the year were based on the assumption that proposedincreases in various charges would be implemented as of October 1, 1989, i.e.,at the beginning of the year. In actual fact, the new charges were notapproved until Harch 1990 and after significant reductions made by KCCCouncillors and the Ministry of Commerce. In order to ensure that KCC's ratesand charges remain buoyant with inflation it was agreed during appraisal thatGOU would permit KCC to increase in a timely manner charges and fees formunicipal services to cover the real cost of providing the services (Para.8.03). This was confirmed during negotiations.

6.05 Rates. Revenue generated by prop-rty rates should be the singlelargest source of income to KCC. The essentlal facts relating to the ratingsystem in the KCC area at present are as follows:

(a) In FY1988 income from rates amounted to U Sh 7.5 million out of atotal from all locally generated sources of about U Sh 351 millionor about 22 of the total income, very much less than graduated tax(552), market rents sad dues (272) and licenses (7?). The ratingsystem now collects an average of U Sh 10 per head, compared toGraduated Tax which collects U Sh 363 per head;

(b) The last major revaluation of Kampala properties occurred in 1982.At that time valuation lists for 12 of the 15 districts producedabout 27,500 entries. No supplementary valuation lists have beenprepared since 1982 and it is, therefore, likely that manyexisting properties are missing from the valuation lists. Inaddition, the assessed property values are well out of date nowdue to inflation, in some cases by a factor of more than 30;

(c) A rate of 15? is set. This is less than the legal maximum of 202.Based on the estimate of the total rateable value in the 1982lists being about U Sh 1,000 million, the theoretical amountcollectable is U Sh 150 million. The amount collected is thusonly 52 of the potential revenue. The full costs of valuation andcollection almost certainly exceed the yield. The rating system,therefore, makes no net contribution to revenues; and

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(d) Payments to KCC in lieu of rates by Government bodies are woefullyin arrears, further straining the capacity of the City to providebadly needed public services; during negotiations, a timetable wasagreed with IDA for settlement of all arrears in rates owed to KCCon all properties owned by Government, parastatals and Government-controlled Boards (Para. 8.03). It was agreed that all arrears,estimated to be U Sh 1.5 billion, will be paid by June 30, 1992.

6.06 Since July 1989, GOU and KCC, aware of the need for majorincreases in the flow of revenue to the City, have undertaken a number ofmeasures to strengthen the rates system. Firstly, KCC has revalued two RatingZones (Mbuya, and the Central Business District). Comparison of the old andupdated lists of properties for the two zones are given in Table 6.2. Theincrease in estimated rates income from Mbuya by a factor of 500 is attributedto the fact that the zone was last revalued in 1970. Secondly, KCC hasstarted an interim program of provisional rating based on a system of massappraisal by which all residential buildings in Kampala are classifiedaccording to six types with a fixed rate, calculated on a sliding scale,payable for each type. The data was collected by RC chairman at the village

Table 6.2Change in Rateable Values in Kampala (1982-1989)

Zone No of Properties Estimated Rates(U Sh 000's)

1982 1989 1982 1989

Mbuya 2,000 1,865 154 77,632Central 2,710 2,635 20,544 1,193,700

Sources KCC Treasurer's Report, May 1990.

level. At the time of project appraisal the exercise was half complete.Based on the estimated 60,000 dwellings in 800 villages within the city withan average annual flat rate payable of U Sh 5,000, KCC envisages generatingmore than U Sh 1.2 billion in the medium term. In furtherance of efforts toboost municipal revenue and as an indication of comuitment by KCC tostrengthening its revenue base, RCC carried out the following action planprior to negotiations:

(a) brought the new Central Business District valuation on stream forbilling and collection;

(b) continued the improvement in efficiency in billing and collectionin respect of the 1982 valuation lists and Mbuya;

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(c) sent out demand notes on the basis of the provisional rating by-laws to 20,000 residential properties in FY1990; and

(d) have collected the equivalent of U Sh 115 million in the form ofrates by September 30, 1990; (Para. 8.02).

The proposed project would finance the revamping of the rating system byestablishing a District Valuation Office within KCC, amending the law asrequired to ensure that the rate can be set at a realistic level, extensivetraining of a cadre of local valuation assistants followed by a comprehensiverevaluation of Kampala properties and improvements to billing and collectionmethods (Annex 6). It is anticipated that in FY1993194, the first full yearof the revamped system, iCC will receive U Sh 2,600 million (1990 value) fromrates, by far the largest single source of revenue.

6.07 Graduated Tax. At present, the principal source of Kampala'slocally generated revenue is the graduated tax which is a modified poll taxpayable by all males over 18, whether or not employed, and women over 18 informal employment. The dues vary from a minimum of U Sh 300 payable(regardless of income) and a maximum of U Sh 5,000 payable if the incomeexceeds U Sh 47,050. The upper income limit was fixed at the comparativelylow threshold which coincided with the bottom limit at which income taxbecomes payable. Since the Budget in July 1989 raised the threshold forpayment of income tax to U Sh 250,000, the top limit and amounts payable forgraduated tax could be similarly adjusted. The performance of graduated taxis difficult to assess by any properly objective criteria due to theinadequacy of the accounting procedures and lack of controls in KCC but theimpression is that it performs well. The cost yield ratio appears low at 32.The coverage of the population appears good with a reputed 180,000 taxpayers.The population of Kampala is estimated to be 700,000 of whom half might bechildren and a quarter women not in formal employment; this would indicate anear maximum coverage. Success is due to three factors: (a) collection at thesource from employers; (b) the public acceptance of that tax; and (c) the useof the receipt cards as identity documents. The tax collected per annum in1988 was U Sh 254 million or the equivalent of U Sh 363 per head.

6.08 Other Locally Generated Sources of Revenue. At present, thesecond largest source of revenue for Kampala, after the graduated tax, isincome from market dues, market rents and licenses on businesses from whichU Sh 125 million was collected in 1988. KCC is well aware of the potentialadditional revenue that could be generated by increasing rents and dues tomarket levels and by tightening control on collection. Ground rents andreversions payable under the Land Reform Decree offer little in the way ofrevenue, amounting to U Sh 10 million in 1988. KCC holds the records for5,600 sites but only demands payment from those where the rent exceeds U Sh10,000 per annum, i.e., about 1,200 plots.

6.09 An unduly large proportion of locally generated tax is at presentpaid by the poor. The higher income groups, unlike the lower income groups,do pay central government income taxes but the levels are not excessive.There seems to be good reason for spreading the burden of paying for localrevenues in a more equitable manner. The most obvious means of introducing a

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greater measure of equity in the distribution of the local tax burden is torenovate the rating system (Para. 6.05).

B. Recent Improvements in General Accounting

6.10 There have been improvements in the financial managements of KCCin the following areas: control of revenue collection, internal audit,processing of data, stores accounting, and management information system.

6.11 There has been some improvement in the control of the mechanizedaccounting system, but the accounting sections have not yet reached the stageof proving the accounts by means of a monthly trial balance. In addition, thecontrol of ledger cards has improved. For FY1989/90 all proof sheets areavailable, thus enabling the reconciliation of data processed.

6.12 Cash income is now summarized monthly by collection points. FromMarch 1, 1990 this has been reconciled to individual cashiers summaries. Thishas enabled the reconciliation of cash collected to cash banked and it willfacilitate the control of cashiers by means of monthly statistics. There hasbeen a major improvement in the control of revenue collections and bankings.From March 1, 1990, the Principal Assistant City Treasurer/Revenue has takenover the responsibility of the combined cashiers collection and deposit bookand the production of monthly cash income control totals.

6.13 There is also some improvement in the treatment of creditors.outstanding debts were calculated at the end of the FY1988189 and efforts weremade to process all overdue accounts payable during the first month of theFY1989190.

6.14 The allocation of wages and salaries to the spending accounts is nowcorrectly undertaken. However, there is still no reconciliation of salary andwage control accounts.

6.15 Fevertheless, the delayed implementation of the new charges forFY1989190 (Para. 6.04) combined with the lack of a realistic balance ofworking capital has resulted in the incurring of a bank overdraft equivalentto approximately one-fifth of the total operating income of FY1989190. Actualexpenditure is, therefore, dictated by the present cash crisis, resulting in aday-to-day cash management basis. During negotiations, assurances were giventhat GOU will place limitations on KCC's use of bank overdraft facilities(Para. 8.03). RCC's use of credit for recurrent expenditure will be limitedto the equivalent of two months revenue calculated on the basis of totalrevenue collected during the preceding financial year.

C. Financial Forecasts

6.16 Projections of RCC's financial performance over the period FY1990 toFY1996 together with the underlying assumptions are shown in Annex 14. Sincethe analysis of past performance indicated that accounts for recent years are

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not a meaningful base for projections, the revised bvdget for FY1990, endingSeptember 30, 1990 was used instead. Thus, base year operating expendituresmore accurately reflect the needs of RCC than figures from previous yearswhich do not reflect deferred expenses. In view of the drop in the rate ofexchange from U Sh 60 in May 1987 to U Sh 372 to the US dollar in May 1990 andcombined with the erratic rate of inflation, projections have been made inconstant prices to avoid having to predict the rate of inflation.

6.17 The projections still contain a number of uncertainties. It isassumed that: (a) KCC will start to implement the provisional rating inFY89190 and from FY1993 onwards all rateable properties are identified andrevaluation is completed including the impact of changing the Local GovernmentRating Decree of December 1979; (b) market fees and dues, etc. will beincreased to cope to a certain degree with the rate of inflation; and (c)collection efficiency, based on the maximum achievable total income, includingrevenue generated by the project, will increase as follows:

FY90 - 27 percentFY91 - 37 percentFY92 - 47 percentFY93 - 56 percentFY94 - 87 percentFY95 onwards = 92 percent.

The projections assume a general climate of economic stabilization, decreasinginflation and economic growth. During negotiations, agreement was reachedthat the collection efficiencies outlined above will be observed as targetsfor KCC's financial performance (Para. 8.03).

6.18 During project implementation, the highest increase in revenues isexpected in FY1993194 from the renovation of the rating system, which thenwill contribute about 50 percent of KCC's total income. Consequently, theburden of paying for local revenues is spread in a more equitable mannerbetween the poor and the better off. Internal cash generation will besufficient to cover full operating costs plus some moderate investments, aswell as future debt service of the loan incurred under the on-lendingagreement and KWC's contribution to the local costs.

6.19 In terms of annual revenue raised per capita, there will be aconsiderable increase over the years of the project period. Table 6.3 belowshows the projected growth of Kampala's population and the increase of annualrevenues of KCC per capita. Given the estimated increase in population byabout 35? over the period, the increase of revenue per capita at 370? over thesame period shows the potentially significant impact of the project on revenuegeneration. This compares with US$9.60 per capita in Nairobi, Kenya (1986)measured in constant dollars.

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Table 6.3Development of Revenue per Canita

Population 1! Revenue Per Capita 5USS)Year

1989 700,000 3.101990 747,000 5.401991 784,000 7.101992 824,000 8.401993 856,000 11.101994 908,000 14.601995 953,000 14.60

11 Population figures taken from Staff Appraisal Report No 8254-UG, SecondWater Supply Project, Uganda, March 1990.

D. Project Cost Recovery

6.20 The following principles of cost recovery are to be applied to thevarious elements of the project:

(a) those costs which are normally recovered by publicauthorities in the form of tariffs or user charges would besimilarly recovered (e.g., water, electricity, refusecollection at public markets);

(b) all site development costs at Kawaala for on-siteinfrastructure including engineering design and supervisionwould be borne directly by beneficiaries in respect ofprivate plots. Costs relating to public areas such as sitesfor schools and comunnity facilities would be borne by KCC;

(c) urban services to be provided to private plot holders inKawaala by KCC would be recovered through property rates(e.g., street lighting, refuse collection).

6.21 Kawaala Sites and Services Scheme. Investment and recurrentservice costs at Kawaala would be recovered as per Para. 6.19 above.

6.22 Kampala Road Rehabilitation Program. The investment costsassociated with the road rehabilitation program would be recovered throughrates and general revenues. They are not good candidates for direct costrecovery because beneficiaries and the value of individual benefits are, ingeneral, impossible to identify. The collection of road tolls is alreadybeing carried out by the Ministry of Finance.

6.23 Rehabilitation of RAmpala's Solid Waste System. Collectioncharges will first be introduced for services at markets, industrial

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enterprises, institutions, business and high income areas. Investment costswould be recovered by these charges and general revenues. It is anticipatedthat the cleansing section would eventually be given some level of autonomyover its own operations, with a separate budgeting and accounting center. Asthe KCC's accounting system does not presently identify the costs associatedwith the provision of various services, the establishment of the cost centerfor public cleansing will be a first step in accounting for all costsassociated with an individual service. This is expected to provide the basisfor setting collection charges more in line with actual costs incurred.

6.24 Rehabilitation of the rating system. The initial investment costof revamping the rating system will be recovered more than eight times withinthe first five years of the program with recurring benefits thereafter.

6.25 Improvement of Kampala's Urban Markets. The upgrading of themarkets as described in Annex 1, coupled with [CC's policy of closing downillegal markets, will attract more customers. This will result in a greaterturnover of goods and higher revenues to RCC through daily dues.

6.26 Cost recovery for project components is summarized in Table 6.4.Nearly 701 of project costs are allocated and are, therefore, eligible forrecovery from specific sources of revenue under the control of [CC. Theremaining 301 of the project costs, including the technical assistance,training, mapping of Kampala and project preparation costs will be recoveredfrom central government revenue.

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Table 6.4Project Cost Recovery 1/

Project Component Cost Method of(US$ 0008) Recovery

Allocable

A. KCC Infrastructure Rehabilitation

1. Urban markets 6,461 Rents and dues2. Solid waste management 6,439 Tariffs and rates3. Streets and drains 7,913 Rates4. Office/mechanical workshop 338 Rates

B. Urban Land Development

1. Kawaala site servicingPublic areas 1,380 RatesPrivate areas 3,221 Plot loans,

user charges

Subtotal allocable 25,751 (672)

Non-allocable

1. Kampala mapping 1,335 Central )2. Urban development planning 1,688 Government )3. MLG/KCC technical assistance/ ) Revenue )

training, vehicles, equipment) )and tools ) 6.962 )

4. MLG office rehabilitation 332 )5. Project preparation 2,432 )

Subtotal non-allocable 12,749 (33Z)Total 38,500

1/ All costs include price and physical contingencies

E. Affordability

6.27 During appraisal, it was established that the proposed projectwould be financially viable to KCC under the following conditions:

(a) GOU passing on US$21.2 million or 74U of the IDA credit as a loanunder terms as outlined in para 4.02; and

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(b) GOU passing on US$4.5 million or 15Z of the IDA credit in the formof a grant;

(c) DCC and GOU each financing half of the local contribution to theproject.

The affordability of the project to KCC is demonstrated by the fact thatKampala's financial projections show net revenues in the third year of projectimplementation (Annex 14).

6.28 It was found that households earning a minimum monthly income ofabout U Sh 36,000 (US$91 per month) could afford to purchase a Type A plot(200 m2) in tile Kawaala scheme, since the downpayment of 10 percent was aboutU Sh 48,000 (JS$118) and the monthly repayment was U Sh 11,000 (US$27 p.m.)including re:urrent charges or about 30 percent of income. Proposedfinancing t rms are set to match those under consideration for the Namuwongoscheme, a project vhich is receiving assistance from Shelter Afrique andHabitat: that is, 15 years repayment including one year grace, and 20 percentinterest. This is a subsidized rate since the May 1990 inflation level wereabout 30 percent. Present trends suggest that inflation is coming down andinterest rates will follow so that these schemes will become replicable overtime (Annex 5, Appendix 3).

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VIz. zCONOaIC AULYSIS

A. Prmaury Proiect Justification

7.01 The project is the first comprebensive effort to redress manyyears of neglect and deterioration of urban services and infrastructure inKampala, while restoring KCC's financial and operational capability. Theproject would improve public health, urban dwellings, transport and incomeearning opportunities in Kampala, in particular for the urban poor includingthose earning their living in the informal sector. The project would alsoestablish the framework for Kampala's future growth in an orderly andefficient manner through proper planning and priority investment programning.

7.02 The project would aim at significant positive social,institutional and environmental effects, since it is set up as one in a seriesof operations to alleviate poverty and the social costs of adjustment. Theupgrading of major markets will improve environmental and health conditions inthe handling of most of the food consumed in Kampala as well as reestablishthe city's authority over this important revenue source. The urban poor wouldbenefit in the form of healthier food and less illness-related workinterruption. The rehabilitation and maintenance of roads, drains andfootpaths will ease motorized, non-motorized and pedestrian traffic, inparticular along major public transport routes and access roads to previouslyneglected lower income, high density areas of the city, and will createemployment. Improved solid waste collection and disposal will improveenvironmental conditions, add to the cleanliness and attractive appearance ofthe city, will have an important public health impact and will createadditional employment as well. The development of a pilot sites and servicesarea will help reduce the housing shortage for middle income groups providedwith the opportunity to build moderately priced houses and for low incomegroups for whom there would be opportunities for privately-owned rentalaccommodation within the scheme. The development will increase KCC'sexperience in managing sites and services projects, and, provided interestrates return to reasonable levels, set a replicable model for futuredevelopment of residential areas in Kampala and other towns.

7.03 Improvements in financial and administrative management combinedwith the mobilization of higher revenues, should enable KCC to provide ahigher level of services without causing a financial burden on the centralgovernment. By FY1993, KCC will have revamped its property tax system andwill be receiving U Sh 2,600 million per annum, an increase of more than tentimes in real terms the amount of rates actually collected in 1989. Thisamount excludes rates arrears owed by public entities, the collection of whichwill be done under the Project. The Project will lead to the reestablishmentand strengthening of an array of revenue collection techniques by which KCCcan generate the income it requires to expand and maintain public urbanservices without resort to central government financial support. It isanticipated that continued improvement will be made in the administration andmanagement of KCC finances by means of an innovative training approachinvolving the establishment of a Ugandan-based training resource center for

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local government under the aegis of MLG. RCC, operating in conjunction with atwinning arrangement with an overseas local authority and supported by theresource center, will also enhance its management skills in clearly definedoperational areas such as road maintenance, solid waste management, marketadministration, and housing development.

7.04 The innovative approach for the institutional development of localauthorities would also be used to strengthen the financial management of othertowns as well as strengthen the monitoring and support capabilities of theMinistry of Local Government, thus setting the stage for possible futureimprovements in other urban areas.

7.05 Throughout the project, least cost solutions including emphasis onmaintenance, rehabilitation and use of appropriate technology including self-help and community efforts, have been given preference so as to ensure thatscarce investment resources will generate the highest possible economic ratesof return. The project components have been chosen in such a manner thattheir results are mutually reinforc'ng.

D. Economic and Other Benefits

General

7.06 Several but not all components lend themselves to a calculation ofeconomic benefits in terms of real resources created versus real costsincurred. Those that cannot be quantified include institution building whichwould contribute to, but could not be isolated as the sole factor leading to,improvements in municipal services. Similarly, public health improvements areclearly an important positive project output, but analytical methods toquantify this impact do not exist. The economic rates of return by component,where appropriate, are described below, together with their non-quantifiablebenefits.

Kawaala Sites and Services Scheme

7.07 The most direct benefits of the Kawaala sites and services projectwould be improved living conditions for about 12,500 persons through theprovision of about 1,000 plots which could eventually accommodate about 1,750dwellings. This would mean a 7 percent reduction in pent-up housing demand,estimated in 1989 at about 15,000 units. The low and lowerlmiddle incomegroups would be the principal beneficiaries. Measured in terms of imputedincremental rent, this project component yields an economic rate of return of13.5 percent. With a ten percent increase in costs, the ERR decreasesslightly to 12 percent and with a ten percent decrease in benefits, to 11.8percent.

7.08 The project will contribute to some extent to more equitabledistribution of well-being. Within the 1,000 plots, 750 plots of about 200 m2each are expected to be affordable for the lowerlmiddle income group, earningabout U Sh 36,000 or more p.m., (Para. 6.27) while 250 plots of 300m2 and 400mZ and 0.83 ha of shops and market plots will be sold in the open market to

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middle and higher income households and traders. (The minimum living incomefor a Kampala household is estimated at U Sh 30,000 p.m. and such a smallhousehold would often rent one room for about U Sh 5,000 p.m.).

7.09 Benefits during construction of infrastructure and dwellings willinclude employment generated by the scheme in building materials production,transport and sale as well as on site construction work. The allottees on thesmaller plots will probably build their dwellings through self-help orcommunity efforts, involving informal sector workers. Benefits afterconstruction include increased incomes of allottees who decide to initiallyrent out one to three rooms in the original dwelling. Since it is foreseenthat water supply will change from standpipes to house connections after about20 years, a second dwelling could be constructed on a 200 m2 plot which wouldprovide a permanent rental income.

7.10 Because of the strong housing demand, middle and higher incomegroups are likely to eventually take over the ownership of houses in Kawaala,as has happened in sites and services schemes elsewhere in East Africa;original allottees who will be selected from the lowerlmiddle income groupwill enjoy the economic rent in case they sell after the prescribed period oftenure. They will benefit through an increase in their assets. This willinclude bona fide present low income residents in the area who will be allowedto retain their present location or get preference in the allocation of plots.

Priority Markets

7.11 Taking into account the investment in improved infrastructureservices (including footpaths, road works, water supply, sanitation,electricity, fencing, sheds, and office accommodation), shadow-pricing thelocal cost component at U Sh 600/US$l.00 and assuming that the magnitude ofeconomic benefit is reflected in the incremental rental income received byvendors who sub-let their stalls, the improvement of urban markets yields anEnR of 23 percent. As stated above, this is only a small portion of totalbenefits of the project component which include health and vehicle operatingcosts benefits described in the following paragraphs.

7.12 The Kampala market system forms a hierarchy where only a few largemarkets perform wholesale and most of the 60 markets perform mixed or retailfunctions. The proposed activities in three prototype markets, one central,one secondary wholesale/retail and one retail market, represent the firstsystematic attempt in many years to support its spontaneous development indirections likely to serve the Kampala population best. No fundamentalchanges are considered necessary in locations or hierarchy; it is, however,expected that if RCC improves the premises and services in existing formalmarkets and makes them more hygienic and efficient, the quality of productstraded as well as the quantity will increase. Hence, suppliers deliveringgoods to market and vendors operating in the markets would be willing and ableto pay somewhat higher dues and rents than before. It is also expected thatthe customers will continue to buy in the upgraded formal markets because theywill value the expected improved quality and selection of goods, in particularof fresh produce.

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7.13 An important part of the benefits of market improvements consistsof public health improvements. The proposed project investments in roads,drains, footpaths, shelters and toilets, together with better administration,operation and maintenance, would significantly reduce the very unhygienicconditions in the three selected pilot markets which present serious healthhazards. It is expected that cleaner markets will mean cleaner produce forthe consumers, cleaner working conditions for vendors and market personnel,hence less illness and higher job attendance and productivity. (The largeamounts of waste materials generated in markets are another health risk, dealtwith in Para. 7.16 below).

7.14 In addition to the public health benefits which are shared bysuppliers, vendors and the general public, better access to the markets andmore efficient arrangements for loading and off-loading and produce handlingmean savings in vehicle operating costs as well as suppliers and customerstime. In a developing country with presumably high levels of unemployment andunderemployment, the vehicle operating costs are more important than the timeelement.

Road Rehabilitation and Maintenance

7.15 The proposed 3-year program for the maintenance of a core networkof city roads by reestablishing the Highways and Drainage Division of KCC CityEngineer's Department will have an ERR in excess of 302 percent as presentedin Annex 15. The benefits occur in the form of deferred maintenance costscreated by delaying the time for major street rehabilitation. The actualreturn will be determined on an annual basis beginning in 1991, with thesubmission of the first in a series of three annual detailed maintenanceprograms by KCC. Incremental inputs include the modest rehabilitation of fourmaintenance depots, performance allowances for KCC workers, road maintenancematerials, equipment, plant and tools totalling US$0.9 million for routinemaintenance plus contractor-executed periodic road maintenance totallingUS$5.0 million, measured in May 1990 base costs (Annex 3).

Solid Waste Collection and Disposal

7.16 Improvements in solid waste collection services are rarelyjustified on economic terms, as revenues from the services provided in mostcases cover only a part (50-70X) of the total costs. Services such as streetsweeping, cleaning of drainage channels, parks and other public areas cannoteasily be charged to specific user groups or beneficiaries, but are benefitsenjoyed by the public in general. Refuse services are considered to confersignificant positive externalities, such as improved environmental conditions,cleaner and more pleasant surroundings, less nuisance from insects, vermin,and rodents, less pollution, smoke and environmental damage around disposalsites, greater employment opportunities, and the convenience of a servicegenerally expected in an urban area. The indirect benefits of theseexternalities are difficult or impossible to quantify. The employment impactfrom refuse collection is quantifiable, and normally ranges from 5 to 50 pe-~10,000 residents, depending on service coverage and collection system.Scavenging alone will typically engage about 10 per 10,000 residents.

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Overall Prolect

7.17 The weighted average ERR for the project for components for whichbenefits could be quantified at the time of project appraisal and which amountto about 51 of the total project costs is 242. The detailed calculations ofthe ERRs are shown in Annex 15.

C. Impact on Women

7.18 The project will benefit womenle living conditions and employment,especially in the lower income groups. They will share in the healthimprovements following from sanitary measures in the markets and refusehandling and from more efficient water provision in Kawaala and will also getmore employment opportunities. Better health will allow them to be moreefficient at home and productive in the workplace and cut down absenteeism.There are recent examples in Uganda of women setting up small informalenterprises such as brick making and trading in response to growing demand,which could be replicated, and more women retail traders are likely to servethe expanding population in Kawaala. In addition to self employment, thewomen are also expected to participate in the increase in labor employmentresulting from the project.

D. Environmental Impact

7.19 The project has been classified as a category B project forpurposes of determining the appropriate level of environmental screeningrequired as part of project preparation. Four fifths of the investment inphysical infrastructure will be directed towards rehabilitation of existingsystems, improvement in operations and limited upgrading of facilities. Mostof the project components will have a definite positive effect and none willhave an adverse effect on the environment. However, there will be aresettlement component at Kawaala for which an acceptable resettlement planwill be required to be submitted by Government as a condition of creditdisbursement (Para. 4.20).

7.20 All road maintenance works will occur within existing rights ofway and will have no effect on current land uses. The improvement in routinestreet maintenance will considerably increase road safety and contribute to alessening of road accidents; the rehabilitation of streetside drains willreduce overflow of rain waters with commensurate reduction in soil erosionalong the street alignment.

7.21 The highly organic nature of Kampala's refuse is such that amodest level of sanitary landfilling will ensure environmental integrity.Consultant studies indicate that the disposal of solid waste at the threeexisting refuse dumps does not appear to cause water pollution. However,there is the potential for contamination of a well adjacent to the LugogoBypass site and protective measures will be taken before continuing tipping.The upgrading of the three existing sites will be carried out in a mannerwhich ensures that the runoff of surface water is controlled and that leachatewill be collected in sumps for subsequent appropriate disposal. Access to

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the sites will be controlled to reduce the opportunity for children and othersto be exposed to hazards. Mulago Hospital's capacity to incinerate hazardousmedical waste will be more than doubled with the installation of a secondincinerator, thus reducing the risk of spread of infectious diseases,including AIDS.

S. Community Participation

7.22 KCC has already started and will continue to organire activeparticipation of the general public and the directl.y affected groups. Thisincludes the establishment of Market Management Committees as a means ofbringing market vendors associations, Resistance Committees and consumers intothe market management process, seeking the certification of eligible residentsin Kawaala by involving Resistance Committees, and sensitizing the public tothe needs and requirements of the new refuse service offered. KCC has alsoencouraged residents to form 'water committees', under the guidance of theRCs, for the purpose of obtaining water from metered public stand pipes underthe terms of an agreement with NWSC whereby monthly water bills are paiddirectly by the community group without KCC1s involvement.

F. Proiect Risks

7.23 The main risks affecting the project concern the effectiveness ofthe two key implementing agencies, KCC and MLG, given that they are emergingfrom a long period of institutional deterioration. KCC is facing a shortageof qualified staff and political constraints to rapid increases in municipaltaxes, rates and charges. The Ministry suffers from low salary levels andoverall central government budgetary constraints. However, KCC has alreadymade dramatic progress in the past year in recruiting qualified staff andincreasing revenue. In addition, the proposed components of technicalassistance and training in this project, together with macro-economic measuresdesigned to continue overall economic recovery supported by I :estructuringoperations, are expected to mitigate these risks.

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VIII. AGREZHENSS REACHED AND REOMMENDATION

A. Actions Already Taken

8.01 By negotiations the Government had:

(a) dec'ared Kawaala a planning (action) area under Section 33 of theTown and Country Planning Act (1964) (Para. 3.11);

(b) prepared to advertise for the recruitment of a municipal engineermutually acceptable to the Government and IDA, to be attached tothe PCU (Para. 5.17); and

(c) prepared and submitted to IDA a list of land to be compulsorilyacquired in the interest of the project and confirmed theavailability of the land required (Para. 4.19).

8.02 KCC had, by negotiations, carried out the following action plan:

(a) brought new Central Business District valuation on stream forbilling and collection;

(b) continued the improvement in efficiency in billing and collectionin respect of the 1982 valuation lists and Mbuya;

(c) sent out demand notes on the basis of the provisional rating by-laws to at least 20,000 properties in 1990; and

(d) have collected the equivalent of at least U Sh 115 million in theform of rates by September 30, 1990 (Para. 6.05);

B. Agreements Reached during Negotiations

8.03 During negotiations agreement was obtained regardings

(a) KCC to have defined and adopted an urban environmental policystatement with special attention to solid waste management byApril 30, 1992; and improvement by KCC in total tonnage of solidwaste delivered at the landfill sites by 1993 from 7,000m3 permonth to 16,000m3 per month (Para. 3.05);

(b) KCC submission to IDA, by June 30 or 1991, 1992, and 1993, of itsproposed annual road rehabilitation program including economicanalysis for review (Para. 3.06);

(c) KCC to undertake to send all municipal vehicles to privateworkshops for major repairs (Para. 3.07);

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(d) agreement between KCC and MOHUD on a suitable modus operandi toenable effective training of personnel involved in urbandevelopment planning (Para. 3.09);

(e) the operating expenses of the primary school to be built atKawaala to be adequately budgeted for by KCC (Para 3.11).

(f) the designation of the building on the IPA compound to be thelocal government training and resource center (Para. 3.13);

(g) PCU will establish, through MLG, a Special Account with a localcommercial bank (Para. 4.15);

(h) KCC will establish an Advance Account in Uganda shillings tofacilitate disbursement in local currency to cover local costs(Para. 4.16);

(i) The implementation schedule for all project components and projectprogress reporting requirements (Para. 4.18).

(j) beneficiary selection criteria for allocating housing plots inKawaala (Para. 4.21);

(k) Government submission of certified copies of project accounts andannual audit reports to IDA not later than six monthe after theend of each fiscal year (Para. 4.22);

(1) Government submission of the appropriate sections of thecompletion report, in a form acceptable to the Association, notlater than six months after the closing date of the Credit (Para.4.24);

(m) Government permission for KCC to increase in a timely manner usercharges and fees for municipal services to cover the real cost ofproviding the services (Para. 6.04);

(n) a timetable for settlement of all arrears in rates owed to XCC onall properties owned by Government, parastatals and Government-controlled Boards (Para. 6.05);

(o) assurances that Government will place limitations on KCC's use ofbank overdraft facilities (Para. 6.15).

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(p) KCC's improvement in revenue collection efficiency, measured as apercent of total outstanding revenue receivable including arrears(Para. 6.17):

FY1990 27 percentFY1991 37 percentFY1992 47 percentFY1993 56 percentFY1994 87 percent

Condition of Disbursement

8.04 During negotiations, agreement was obtained regarding thecondition of disbursement for components requiring the acquisition of land,viz., that all land required for the project (markets, land development atKawaala) will be held in legal title by KCC and that a resettlement andcompensation program satistactory to IDA for current legal occupants will havebeen prepared (Para. 4.20). The program will include a timetable forcompensation, priority allocation of plots to bona fide occupants in Kawaalato be moved under the proposed project and a plan to relocate bona fidevendors who will be moved around/from Owino market as a result of thereduction in number of stalls.

Conditions of Effectiveness

8.05 During negotiations agreement was obtained regarding the followingconditions of effectiveness:

(a) the subsidiary loan agreement between the Government and KCC willhave been entered into (Para. 4.02);

(b) fulfillment of the conditions of effectiveness of co-financedloans and grants (Para. 4.04); and

(c) the municipal engineer for PCU and the accounting development andtraining officer for KCC will be in post (Paras. 5.05 and 5.17).

C. Recommendation

8.06 Subject to the above, the project is suitable for an IDA Credit ofUS$28.7 million equivalent at the standard IDA terms with a maturity of 40years. The Borrower would be the Government of Uganda.

ANX 1Page 1 of 6

UGANDA

FIRST URBAN PROJECT

Kampala Urban Markets Rehabilitation Program

A. Background and Project Fonmulation

1. The city of Kampala is served by 60 urban markets with a totalof more than 16,000 stalls. These facilities cater to the consumptionneeds of all segments of the population and have been growing in number intandem both with the city's expansion and with the decreasing opportunitiesfor income generation in non-trade sectors of the urban economy. Thegrowth in market facilities in recent years has been in the form of'spontaneous' developments that have materialized in response to populationgrowth and concomitant public demand. KCC has lacked the resources toprovide for even minimum infrastructure, sanitation, and securityfacilities.

2. The size and spatial distribution of Kampala's markets closelyreflect the pattern of settlement of the city (see IBRD Map 22472). OwinoMarket, the city's primary market, serves the densely populated centralsub-district and part of Makindye. Four important secondary markets areevenly distributed in the four quadrants of the city and are located onmajor transportation arteries: Nakawa Market serves Nakawa sub-district,to the east; Kibuye Market serves Rubaga and part of Makindye, to the westand south; Natete Market serves Rubaga in the west; and Kalwere Marketserves Kawempe, the most rapidly expanding sub-district of Kampala, to thenorth. A fifth secondary market is located on the shore of Lake Victoriaat Gaba and provides for a two-way flow of goods between the city properand the Kyagwe Islands near Kampala. Owino Market, consisting of 4,900stalls serving 30,000 people per day, supplies not only retail consumers incentral Kampala but also wholesale vendors from other points in the overallmarket system. Wholesalers and porters at the secondary markets service,in turn, the 54 remaining tertiary retail markets which are scatteredaround Kampala.

3. Kampala City Co'ncil (KCC) had by the mid-1960's, establishedeleven markets including a hierarchy of designated wholesale and retailcenters, which were well-planned, approved by its Development Committee,and constructed of permanent materials. During the period of civildisturbances in the 1970's, however, KCC lacked the funds to support anongoing program of planning and constructing additional markets. Itdecided, therefore, to maintain control over the planning, development andregulation of the markets while at the same time encouraging vendors andtraders to construct their own stalls on a self-help basis in accordancewith KCC bye-laws. These were embodied in the Kampala Market By-Laws;1974. The by-laws prohibited the use of permanent materials on the groundsthat these second-generation markets were temporary in nature and subjectto relocation upon preparation and approval of Development Plan for

ANM 1Page 2 of 6

Kampala, drafted in 1972 and approved in 1974. It was anticipated thatthis Plan would designate the best locations for all new markets.

4. In fact the Development Plan for Kampala did not address thelocation of Kampala's markets. Since then an additional thirty-five so-called 'un-established' markets have been developed, mostly in theexpanding parts of the city. While many of these were developed underKCC's authority on KCO-owned land, others were developed on a combinationof KCC and privately-owned (mailo) land. Another fourteen "miscellaneous"markets and up to twenty illegal markets have been developed since on an adhoc basis with little or no KCC involvement. Some of the latter weredeveloped by co-operative societies (e.g. Bwaise II) on privately-ownedland.

5. In the past, the absence of any comprehensive planning andregulation of the food marketing system in Kampala, while posing a risk tothe health and welfare of its inhabitants, has afforded the freedom formarkets to spring up quickly to provide services in those areas where theyare most needed. However, as a negative consequence of their unplanneddevelopment coupled with KCC's financial constraints, most markets now lackbasic infrastructure and sanitary facilities. Older markets have not beenproperly maintained and are in need of extensive rehabilitation. In mostinstances they have grown beyond their original boundaries occupyingprivately owned land or land originally slated for other uses. Despitetheir unsanitary, crowded and chaotic environment, urban markets perform anessential commercial role in the economic life of Kampala, not the least ofwhich is generating 26? of KCC's total annual revenue (1989), second onlyto graduated personal tax.

6. The current management structure of Kampala's market systemreflects an increasing desire by the KCC to improve revenue from itsmarkets. In November 1988, responsibility for the markets was transferredfrom the Public Health Department to the Treasury Department. Ultimateresponsibility for medium and long term planning rests with the CityCouncil, while the Treasury Department is now responsible for the day-to-day management and administration of markets. The Principal Assistant CityTreasurer (PACT) is responsible for overseeing all market revenuecollection. The PACT oversees the financial and operational administrationof the markets. 'The financial accounting of markets is divided into sevenadministrative sections; Nakasero, Nakivubo, Owino, Kololo, Mengo, Nakawa,and Kavempe. The first four are administered as single markets while thelatter three group all the KCC markets in their geographical areas.Operational administration is through four geographical groupings;Nakasero, Namirembe, Katwe, and Nakawa.

7. The Chief Market Administrator is in charge of planning,controlling and organizing the KCC market programs. There are fiveAssistant Chief Market Administrators, each responsible for one of theoperational sub-groups. Ten Senior Market Administrators are responsiblefor either a single large market or a group of smaller markets, reportingon the financial and administrative conditions in their areas. In 1986,the Town Clerk appointed a number of special Market Administrators to actas roving inspectors checking financial operations. The Senior Market

ANNEX 1Page 3 of 6

Administrators supervise the work of ninety Market Administrators whocollect rents and dues from vendors and transporters, and enforce marketby-laws. They also settle disputes, transport money to the cash office,and keep records of daily and monthly transactions in their section of themarket. The Senior Market Administrators and Market Administrators aretransferred, to different markets on an annual or semi-annual basis. TheMarket Administrators are also responsible for coordinating the activitiesof two-hundred and forty four porters and three repairmen. The PrinripalHealth Inspector - Food and Drugs Section manage public health inspectorsassigned to monitor and enforce the provisions of the Public Health Act,governing the sale of foodstuff.

8. In recent years market rents and dues have not kept up withinflation and bore little relation to value of turnover or ability ofvendors to pay. However for 198811989 total estimated revenues fromKampala's markets were Ushs 200 million, of which Ovino market accountedfor about one third. Expenditures, excluding a proposed Ushs 60 millionallocation for a market rehabilitation fund, have been estimated at aboutUshs 42 million for the same period. This represents a threefold increaseover 1987/88 levels. New rents and dues introduced in April 1990 areexpected to significantly increase revenues from markets even though therehas been some popular resistance to the recent increases without acommensurate improvement in the level and quality of service.

9. The proposed market rehabilitation program owes its origin toKCC's desire to re-establish its financial and administrative control overthe market system in the interests of both public health and the health ofthe municipal fiscus. The rehabilitation of markets was identified as apriority need and subsequent assessment and analysis by consultants engagedby the Uganda Government, led to the identification of nine markets forpriority upgrading and rehabilitation. The markets were chosen on thebasis of: i) location; ii) land owned by KCC; iii) having potential forphysical expansion; and iv) being representative of a sample of primary,secondary and tertiary type markets. All nine markets were all in greatneed of rehabilitation and reconstructior. and, together, represented almostthree quarters of the stalls in KCC approvedlmanaged market system.

B. Program Objectives

10. The major goal of the program is to improve the physicalenvironment and operational efficiency of Kampala's urban market system.The proposed program will permit KCC to reassert its authority over theorderly development and management of its markets with a view to improvingthe level of service, the quality of administration, and the enhancement ofmunicipal revenues. The program also establishes a physical planning andarchitectural design framework allowing for the gradual improvement ofinfrastructure and facilities of the remaining markets as finances permit.

AM, 1Page 4 of 6

C. Detailed Description of Program

11. The program provides the following elements:

(a) a catalog of design improvements for all markets based on asystem of standardized building components including off-loadingand storage sheds, lock-up and open stalls, administrativeoffices, gates and fences, arcades, and ablution facilities; thecatalog to include standards of infrastructure services to beprovided to markets;

(b) a set of site plans for the following nine priority marketsproviding better vehicular and pedestrian access, circulation,sanitation, drainage, and security;

ti) Owino* (Musupali) 4910 stalls(ii) Nakawa 815(iii) Kalvere 700(iv) Kibuye I 487(v) Gaba 360 n

(vi) Nakulabye 349(vii) Kamwokya 303(viii) Bugolobi* 250(ix) Natete* 202

Sc) the rehabilitation of Ovino, Natete, and Bugolobi Markets asbeing representative of each of the three tiers of the marketsystem; the rehabilitation consisting of the construction ofminimal new building components located according to theredesigned site plans together with improved levels ofinfrastructure services;

(d) the provision of selected items of office equipment, furniture,vehicles and tools for the improved operation of the markets in(c) above;

(e) the provision of technical assistance and training for KCCmarket workers at all levels of the management structure.

12. Owino, Natete and Bugolobi Markets will be properly planned andprovided with appropriate access, parking, drainage, and protection fromthe elements. Refuse collection will be improved under another componentof the Project. The designs for market spaces and fittings will allow avariety of vending configurations, taking into account the wide range ofgoods to be sold. Vendors will lease space and construct their own stallfittings within contractor-built divisions to suit their individual needsand to a minfimum building standard.

£33 1Page 5 of 6

D. Program Costs and Funding

13. The total base cost of the urban markets rehabilitationcomponent is estimated at US$5.3 million, of which the foreign exchangecomponent is estimated at 792. These figures exclude technical assistanceand training for market management and operations, estimated at US$0.07 andincluded in the package of technical assistance to MCC. Details of theprogram costs are given in Appendix 1.

KAMPALA URBAN MARKETS REHABILITATIONSUMMAY COST ESTIMTES

May IO bass costu (excl aII contlgncloc)(US 000)

item Local Foreign Total

Market mnag mnt as 141 176Owino reconstruc*4on 800 2,046 8,640Natebe r.conetruction 92 4ff 6o0Bugolobt reconetruction 124 662 676Enginering dneign/supervieioo (SS) C1 19S 244

TOTAL 1:102 4.201 6,802

14. It is envisaged that, as MCC finances permit, the city mayundertake the gradual and progressive improvement of the other prioritymarkets, using its own funds and the designs of similar elements andcomponents. The only additional work needed would be detailed site plansand schedules which can use the consultants preliminary plans alreadyprepared for the remaining six sites (Nakawa, Kibuye I, Kalwere, Nakulabye,Kamwokya and Gaba).

E. Implementation

15. ICC will be responsible for implementing the marketrehabilitation program. Civil and building works will be carried out bycontracts procured under ICB. Periodic construction supervision will beundertaken by consultants selected in accordance with Bank guidelines. Co-ordination of construction will entail the close co-operation andinvolvement of all the vendors through the vendors associations. TheMarket Management Committees, which have recently been established by MCCand which include members of the vendors associations, RCs and the generalpublic will be involved. Construction will be phased so as to minimize theamount of disruption to ongoing market activities: vendors will need to berelocated within the markets as works progresses. In the case of Owino,the final number of stalls will be less than the original number and KCC isdeveloping a plan to accommodate the overflow in nearby markets.

ANX 1Page 6 of 6

16. The designs and construction of the new market facilities allowfor the continuation of the current practice of KCC providing basicfacilities, such as infrastructure (roads, footpaths, drainage, water,security lighting and perimeter vall, off-loading facilities, and opensheds) while the vendors would build their own stalls (lockable and open)on a self help basis.

17. After construction Market Management Committees will be involvedin reviewing improvements while the vendors associations will be given abigger role to play in the day-to-day maintenance of the markets.In order to improve the service it provides to the public, improvemanagement, efficiency and revenues derived from the markets, KCC isundertaking a thorough reorganization of its internal administrativestructure, including upgrading of staff.

An I

Page 1 of 3KAWALA UR1M8 MARKETS R IHAILITATWN

DETAIL COST ESTIMATES

May 1m base coto (excluding elI contingencloe)(USS 000)

A. Vehiel*l/Furnitur./Equtp.ent/Rehab

Ref. Itow Rty UnIt Local Foreigq TotalNo. Cost

1. Pick-ups (half-cabs) 2 S0 0 60 602. PC A printer 1 8 0 a a8. Safe. 8 2 0 6 64. Gneral Office Equlpment 0 12 12S. Office Furniture 5 10 156. Office Refurbishment 80 0 307. Heavy-duty wheelbarrows 180 0.250 0 82.6 82.5S. Shovel 200 0.025 0 5 59. Brooms 200 0.015 0 8 810. 8oot 150 0.030 0 4.C 4.5

Total morket manag nt 85 141 176

S. Market Reconstruction: Owino

item qty Unit Local Foreign Totalcoost

-. nfr estrutureSlt preparation - - S - 5Earthworko - - 1o0 240 855Storm drainage - - 16 42 soFootpaths - - 117 272 869Roadworke - - a1 7 104Foul sewerage - - 7 17 24Water supply - - 1S 48 61Electrical - -ea9 77

Sub-total Infrastructure 872 703 1,075

SI. BuiIdingsSheds

Al 9 25.6 46 132 22681 62 85.15 446 1,79 2,241

Off-loadingType 1 165.4 8 13 16Type S 2 84.97 14 *6 70Type 4 8 U4.41 88 181 168

Lock-up *tallsC 136 8.24 86 852 4410 144 5.38 16 671 @40E . 44 7.20 6s 258 817

Adin officesType 1 7.48 1 6 7Type 4 1 20.31 4 17 21

AresTyp 1 265 0.76 42 165 207

Gate/FenceType 1.2 (pdo) 2 18.46 5 22 27Vehicle gate 4 2.48 2 a 10Perimeter 467 0.21 16 so 6

Toleot4Various 4 26.40 28 91 114

LandscapingPlanters/seoting 400 0.06 6 14 20

Sub-total Bul Idld" 6n $8,54 4,319

Sub-total lnfra * Bldg 1,887 4,604 5,948Lee: Self-help 587 1,56m 2,294

Total: Owino *00 2,846 8,64

ANNEX 1Appendix 1

C. Market Reconstruction: Natet Page 2 of 3

Item Qty Unit Local Forelon TotalCost (USS 'ooo)

I. Inf rastructureSite preparation - - 8 - 8Earthwork. - - 2 14 16Storm drainag - - 13 29 42Footpaths - - 6 S1 67Roadworks - - 0 4 6Foul sewerage - - 2 19 21Water supply - - a 28 81Electrical - - 1 8 9

Sub-total Infrastructure 80 153 188

II. BuildingsStall sheds

Al 7 26.36 as 142 178A2 2 18.28 7 29 87AS 6 12.27 12 49 61

off-loadingType 1 1 15.64 8 12 16

Lock-up sta llsA,9,C 63 3.24 41 183 204F,G 9 8.83 16 84 79

Adamn officesType l 2 7.43 8 12 1SType S 1 20.81 4 17 21

Gates/FencesTypo 1.2 (pod) 1 13.46 3 11 1SType , 6, 7 2 0.68 0 1 1Vehicle gate 1 2.48 1 2 2Perimeter fence 240 0.21 9 41 S0

Toil etVarolous 1 9.26 2 7 9

LandscapingPlanters/seating 120 0.05 2 4 6

Sub-total Buildings 138 55S 893

Sub-total Infra A Bldgs 18 708 876Loes: self-help 75 240 316

Total: Naotet 92 468 560

i'1

ANNEX 1Appendix 1

0. Market Reconstructlont Bugolobt Page 3 of 3

It.. eQy Unit Local Foreign TotalCost

I. InfrastructureSite preparation - - 10 - 10Earthwork. - - a 29 32Storm drainage - - 17 40 soFootpaths - - 8 81 34Roadwork* - - 2 19 21Foul sewerage - - 2 18 18Water supply - - 8 28 81Electrical - - 2 18 20

Sub-total Infrastructure 48 180 223

II. BuildingsStall sheds

Al 2 25.38 10 41 51e1 2 18.29 7 29 37As 1 12.27 2 10 12A4 3 80.49 18 78 91AS 6 36.64 44 176 219

Off-loadingType 2 1 81.09 6 2S 31

Lock-up stallsA 8 8.24 C 21 260 e 5.683 42 168 210

Amin officesType I 1 7.48 1 8 7

ArcadesType 2 80 0.61 10 39 49

Gate/fencesType 1.2 22 0.61 a 1i 13Type 8 1 18.11 a 10 18Vehicle gate 1 2.48 1 2 2f erioeter fence 130 0.21 5 22 2?

ToiletsVarious 1 16.14 3 18 1s

LandscapingPlanters/seating 44 0.05 1 2 2

Sub-total Buildings 162 647 808

Sub-total infra # Bldg* 204 827 1,031Less: self-help 01 276 358

Total: Bugolobi 124 552 676

UGANDA

FIRST URBAN PROJECT

Rebabilltatiom of ampala's Refuse Collection nd Disposa S ervie s.

A. aackaroud *nd Prolect For lation

1. The estimated amount of solid waste generated In Kapala is presently1,700 m3lday (760 tons/day), of which less than 20 Z is collected. Regularrefuse collection service is provided to less than 102 of the city'spopulation. Negligible amounts of waste are disposed of by comercial andindustrial establishments bringing their own refuse directly to the tippingground or contacting RCC's Cleansing Section for ad hoc removal. Householdwaste in Kampala typically contains 702-802 wet, organic material whichdecomposes rapidly. Uncollected household waste is disposed of in gardens andvacant lots where it is used as animal feed, burnt, composted, buried ordecomposed in the open.

2. There is no iCC offfee responsible for overall development, planning 5ndcoordination of the various cleansing activities. The Cleansing Section underthe City Engineer's Dpertment is responsible for the removal of municipalwaste. Hovever, the Highway and Parks Sections, also under the City Engineer,are responsible for street sweeping and park cleaning respectively, vhile theDrainage and Sanitatio* Section under the Public Health Department remove*debris and garbage from caftals, anti-malarial drains, and manholes. Septictank sludge emptying, mainly the responsibility of MISC, is also carried outby ZCC.

S. The collection system consists of open, communal containers in threedifferent sizes (4, S, and 15 m3) and vehicles specially equipped for theiruplifting and transpertation to dumping grounds. Open containers, frequentlyunsanitary, unsightly and overflowing with refuse, invite scavenging bypeople, animals, and insects.

4. The landfill operation is critical. BCC has three available disposalsites but only the LugogoBypass is in operation. There is only one compactor(bull dozer) in operation, and this limits the amounts of waste that can bedisposed. The major public health problem are associated vith the presenthaphazard disposal of hospital waste directly on the landfills. The opendumping at the Lugogo By-pee. site and the overflowing open containers are themain environmental concerrt.

S. The mechanical eqai#mft is on averag 6 years old and is still infaLrly good condition, yet utilization is extremely low (302). This isprimarily owing to problems associated with lack of funds and spare parts, lowstaff motivation with resultant few hours of actual operation, and cumbersomeprocurement and operating procedures. In addition there are problems ith theequipment design and constructions under-designed hydraulic arms, containersnot protected against corrosion, and welded seams too weak. All bulldozersfor levelling tipped refuse are over 20 years old and need replacement.

AMU 2Page 2 of 5

6. Cleansing services are paid for through budgetary allocations from theCity Treasury with revenue raised through general taxation. The CleansingSection's only direct income is from charges levied for ad hoc refusecollection from commercial enterprises and the sale of slaughterhouse waste,amounting to far less than one percent of the Section's operating budget.

7. The most serious constraints to extended service coverage ares i)equipment under-utilization due to lack of spare parts, repair andmaintenance; ii) low labor productivity; iii) non-functioning of disposal siteequipment; iv) inaccessibility of sites during the rainy season; v) lack of anadequate revenue base caused by lack of cost recovery; and vi) cumbersomeprocurement procedures.

S. Objectives

S. The goal of the solid waste management program is to support the on-going operation of RCC's Cleansing Section by expanding and improving refusecollection and disposal services to reduce health risks; to reduce pollution;and to assist generally in improving the eavironmental conditions in the city.Nore specifically the program would seek to*

(a) improve and expand storage and collection of solid waste by theprovision of additional containers and lift vehicles;

(b) improve routine maintenance levels of vehicles and equipmn^t byrehaSilitating the DCC mechanical workshop located on SixthStre it;

(c) improve refuse disposal practices by providing necessary plant,civil works and technical assistance to Introduce sanitarylandfill operations at the three existing municipal refuse tips.

C. Detailed Description

9. MCC solid waste management operations vill be consolidated andstrengthened. The Cleansing Section will have offices for operations, planningand development, revenues and accounting, and administration An Improvedrecording and data information system will be established for propermanagement, performance monitoring, planning and day-to-day operation of theservices The Cleansing Section would be given some level of autonomy overits own operations, with a separate budgeting and accounting center, inconsultation with the City Treasurer. Training of SWM personnel at alladministrative levels would be provided as part of the service upgradingefforts.

10. The principal mode of operation will be collection of waste fromcomunal containers in municipal markets, institutLons, commercial andiadustrial areas, from high incan residential areas, and other congestedareas where collection is required. Personnel costs are relatively lowcompared to equipment costs, and for this reason collection vehicles and

AM=EX 2Page 3 of S

landfill operations will be operated on two 6-hour shifts from 6 a.m to 6 p.m.

11. The city will continue to develop the current collection system, exceptthat the existing open 5 ma skips with appurtenant trucks will be phased out,and replaced with 2 mS enclosed containers and lift trucks uth hoist-armswhich can haul 4 containers at once. Additional 4 m3 and 15 m3 skips andvehicles will also be supplied. (See Appendix 1 for details). The 2 m3containers will be less conspicuous than the present skips, and can be placedat a more frequent spacing, allowing for more convenient use. In residentialareas the containers would be placed within acceptable walking distance fromthe user, approximately 200m. The present collection frequency would bemaintaineds once or twice weekly collection in residential areas. Collectionservice will be expanded gradually according to demand and willingness to pay.Other areas with high population densities, and where there are not acceptablepossibilities for on-site disposal and composting, will also be provided withregular service. A small number of rugged, new 2 m3 lift vehicles will beintroduced on a trial basis to serve high density residential areas with poorvehicular access.

12. Collection charges will first be introduced for services at markets,industrial enterprises, institutions, businesses and high income residentialareas. Collection services in less congested medium and low income areas willbe introduced over timn, depending on costs and affordability of the service.The local Resistance Councils will be mobilized to motivate and promoteIntroduction of collection services in their respective areas. A tariff studywill be undertaken to determine an appropriate cost recovery strategy(Annex 8). Service coverage is assumed to increase from less than 201 to-dayto 50-60S in 1994, based on total was'e generation. KCC will increase vehicleutilization from 301 in 1990 to 802 by the end of 1992.

12. Upgrading of the municipal workshop and garage to acceptable standardsfor routine maintenance is a prerequisite for improved service performance andwill be provided for in the Project (Appendix 3). Under a recent KCC policydecision, aajor repairs and equipment overhauls will be given out to privatesector workshops. Routine service and supply of specified spare parts for a5- year period would be included In the purchase agreements for new vehiclesand mechanical equipment. Equipment for monitoring the water pollutiondownstream of the landfills and for landfill gas detection would be includedin the workshop equipment proposal.

13. In order to maintain an adequate and satisfactory level of service thecleansing operations must be closely supervised and monitored. The servicearea would be divided into five collection zones, and inspectors/supervisor,equipped with motorbikes, would be assigned to each zone. Each zone wouldhave an office for the inspector, a depot and function as a mustering pointfor collection vehicle crews.

14. The proposed collection system will depend on active participation ofthe public. A public information campaign to sensitize the public to the newrefuse collection and service charge system, to increase the awareness of aclean environment and the need for securing resources for this service will be

ANM 2Page 4 of 5

undertaken. People would be encouraged to campost their own waste. in orderto reduce the waste quantities to be collected, and thereby reducing the totalservice cost.

15. Mulago Hospital's capacity to dispose of hazardous medical waste willbe increased by the installation of a new incinerator, thus reducing the riskof the spread of infectious diseases, including AIDS. In the meantimeemergency arrangements will be made for the safe disposal of hospital waste indesignated areas of the landfills. The three municipal sites would beprepared and upgraded to controlled landfill standards. Only one or twolandfills would be operated at the same time. Measures to locate and preparea new disposal site would be taken during the Project Implementation period.

D. Costs and PFia cfini

16. The summary estimated total base cost of the program is US$5.3 millionas shown below. This total excludes the cost of long-term technicalassistance to be provided as part of KCC's twinning arrangement described inAne: 7. The investment plan gives priority in the early years of the Projectto upgrading the disposal sites at Lugogo By-pass and Luzira, improvement ofthe workshop, and technical assistance to KCC.

SolId laste R.ab l ltatioo PmgrEstimtd TotI Cot (U 000)(My166 lmPricem)

item Local Forelga Total I Forelg

Comt"au 821 1,6" 2,147 onVehIcles 4 1,20 1,2m 7XLaadi II .qulpment 76 488 we onLadfIll preparation 461 60 60 1aNopital Inclomeatr 5 58 10W soWorkshop qappms.t sad rehab 4* 11 so so5TeAlael agista.. se 40 144 7S

TOTAL 1,=8$ 8,408 5,2n6 703$ _-o _ _ _

Sovro.: CoISutt esimt

hgRU 2pag 5 of 5

B. luaplmatatiom

17. Implementation of the solid waste program vould be the responsibility ofthe Cleansing Section under the City Engineer. The technical assistance to beprovided would include resources for the following tasks: i) a tariffstructure study, including willingness to pay survey: ii) preparation for apublic awareness campaign; iii) preparation of tender documents for upgradingthe landfill sites; iv) preparation of tender docuaunts for supply ofcollection vehicles, containers and landfill equipmentt and v) training andtechnical assistance to RCC during first year of project implementation.

18. Bid documents for procurement of vehicles and equipment will be preparedby the time of credit negotiations. Similarly, detailed designs and tenderdocuments for civil works for i) the upgrading of the three refuse dumps tosanitary land fill standards and ii) the rehabilitation of the mechanicalworkshop will be finalized by credit negotiations. Funds have been providedin PPF P487-2-UG for these tasks. Funds are also available under the PPF forthe emergency repair of the one remaining bulldozer required to level refuseat the Lugogo By-pass refuse dump. The list of tools and equipment for theworkshop will be submitted to ITn for review before bids under ICB are called.

19. Two main vehicle and equipment contracts, one for collection vehiclesand the other for landfill equipment, would be procured through ICB. Thesewould total approximately US$1.8 million and US$0.5 million respectively.Civil and building works would involve four contracts, each one not exceedingUS$0.2 million. It is not likely that international tendering would attractforeign contractors and hence these works would be procured through LCB.Containers (US$2.2 million) are fabricated locally and would be procured underLCB over a five-year period provided that quality, quantity and cost are shownto be comparable with estimates from international vehicle and equipmentmanufacturers/ suppliers.

20. KCC has agreed to achieving an increase in the volume of refusedelivered to refuse sites from 7,000 m3 per month to 16,000 m3 by the end of1993.

AN 2Appendix 1Page I of 1

Solid Waste Rehabilitatlon PrograCapital Ceots of Collection Equipmnt(Nay 100 priem)

Item Unit Numbr of unite per yer Total TotalCot Units Cootuss loft 19i2 iw 1014 low Usa 0oo0'

Container.

2.8 1,8'0 20 40 80 s0 48 248 8284.8 1,560 0 S0 280 2tO 298 028 1,717is"8 8,000 0 12 12 10 0 84 102

Sub-total container. 20 102 182 8S0 841 1,206 2,147

Vehicles

Ix2 wi 24,000 2 0 0 0 0 2 484 as 89,000 0 0 8 8 13 84 1,8264x2 8 60,000 0 0 2 1 2 £ 2501S u8 60,000 0 2 1 0 0 8 10motorbikes 600 10 0 0 0 0 10 8

Sub-total vehicle 12 2 11 9 20 54 1,8112

Landf IeI ptpoment

Bull dozer (D5) 78,000 1 0 1 0 1 8 219Wheel lader 50,000 0 1 0 0 0 1 SOBack NoH 40,000 0 1 0 1 0 2 80Tipper Truck 50,000 0 1 0 1 1 S 10Leachato p_o $,n8o 0 1 0 1 1 8 10

Sub-totaI Landtil pipumst 1 4 1 S 12 609

TOTAL U8 106 804 872 S8 1,271 4,469

ANEX 2Appoodlx 2Peg 1 Of 1

Solid Waste Rebhbl ttateon ProgramInvestment Plan (USI 000)(May 16 price)

Item 1991 lo2 1900 1994 100l Cost

Containers 2 1i8 t81 048 000 2,147Vehiclo 0a 120 472 802 $00 1,012Land&il equipmt 78 148 7 98 120 S0Landfill preparation 105 190 so 120 0 S01Hospital lncinerator 68 a8 0 0 0 10lWorkshop utipment and reMbe so 0 0 0 0 soTechnical assstadnce 84 s0 0 0 0 144

TOTAL 40? 748 1,812 1,228 1,e 5,288

====-====--

Sourcs: Consultant estimato excluding long-tern TA provided udr linking erengeea t (Anrme 7)

Appeadi S Page I of 1

SolidWaste Rlhlablition PrormCivil n NWSolding Works(May 10 prices)

Land I Sit"

Oescriptioo Estimated Cot (USS)

1. Fencing 7,150 11,70 t,000S. Site clro *8,000 149,000 2,000S. Aoes road 1,000 6,000 6,*004. Surfae, rwoftf ditb 6,130 15,70 21,009S. DraIna pipsork 0,260 24,750 *8,000S. Leachat. drain 7,000 21,000 21,000T. Site ccomodtion 70 2,260 8,000S. Site roade 11,600 84,500 46,000

TOTAL 126,000 75,000 600,000

Rehabilitation of Slabt Street Moanical Worksho

eowriptlom Estiated Cost QUSS)

Loal For.lgn Total

1. ngsin, roo 1,60 5,5s0 7,400_. Svice ramp 70 2,260 8,0008. 1uel Suore Block 6 1,60 2,2004. Mehanleal Store 1,026 8,076 4,100S. Blacke Shop A7V 2,615 8,6006. Store and Offic S,lock 1,615 4,76 6,6007. Washing an Spraying Soys 1,800 $,000 ,12006. Parking Sp21,160 ,60 9,0009. Sform war dralao 1,5 5,616 7,600

TOTAL 12,200 86,00 46,600

Pag 1 of 4

UGAUDA

FIRST URBN PROJCT

Roads and Drains and Maintenance Progr

A. Background and Proiect Formulation

1. The road network under the jurisdiction of Kampala City Councilis comprised of 270 km of bitumen and 178 km of gravel roads. Certainsections of trunk roads passing through the city are the responsibility ofthe Ministry of Works. A number of minor tracks and local access roads inthe outlying areas have not been taken over by KCC and are maintained, ifat all, by local residents. Most of the streets in the central businessdistrict are, or were, of high bitumen standard with sidewalks and covereddrains. In the outlying areas, only the major arterial roads are ofbitumen standard but they lack sidewalks. The remainder of the roads,including most roads in Kawempe, Rubaga and Makindye divisions, are ofgravel (murram) or unimproved standard.

2. During the period 1970-1983 no new construction and very littlemaintenance was carried out. Faced with diminishing material and financialresources, Kampala city roads (and drains) were allowed to deteriorate tothe extent that many had either fallen out of use or were irreparablydamaged. Vehicle operating costs rose dramatically and trafficcirculation became chaotic and inefficient The public transport fleet wasdepleted and expensive in relation to incomes, particularly those ofworkers living in outlying, cheaper areas. Recent (1989) householdinterviews indicate that more than half of the labor force still walks toand from work, many to save their transport allowance, others saving on thepublic transport costs, which average U Sh 10,000 per month.

3. The City Engineer's Department of DCC, faced with a total lackof equipment, manpower and financial resources, was powerless to mitigatethe deterioration, let alone improve the road network. What was left ofthe equipment and tools in the depots and central workshop was looted in1979 and subsequent budgetary allocations were insignificant in real terms.The road maintenance and drainage cleaning activities, once fairly wellorganised and managed, essentially ceased.

4. It was against this backdrop that during the period 1984-1986EEC financed Phase I of an emergency rehabilitation project consisting ofabout 30 km of major roads * A further 11 km were financed by the UgandaGovernment. In many instances only the road base and surface werereconstructed, while drainage systems and pedestrian sidewalks were largelyuntouched. Despite these technical short-comings, the investments improvedthe city-center traffic situation dramatically.

5. Starting in 1992, EEC plans the reconstruction of a further 30-35 km of roads In Kampala in a Phase II to be financed from Lome IV. loadshave been selected on the basis of their importance as major arteries, inserving Industrial areas, as by-passes to heavily-trafficked roads and asimportant links from one area of the city to another.

AU Xhaze 2 of 4

6. Heanwhile in 1988. in recognition of the need for additionalroad improvement, both to maintain snd upgrade past investments and to stopthe further deterioration of the newly rehabilitated road and drainagesystem, EEC embarked on a four-year Routine Road Maintenance (RIM) andExtraordinary Road Maintenance (ERM) program of assistance to KCC's CityEngineer's Department. RIK refers to spot repairs while ERM includesperiodic resealingiresurfacing of bitumen roads, regravelling murram orearthigravel roads and major cleaning of the drainage system. The programwas originally designed to assist ICC to take on progressively greaterroutine maintenance responsibilities, while contracting out the moredemanding periodic maintenance. The EJMIRIM program is also providingtraining to ICC staff In road maintenance techniques as well as train localcontractors In road maintenanc. practices and rehabilitate some of thedepots vandalized in the 1970s. Xoolo depot, one of six In RCC'sdecentralized system of municipal maintenance, has been partlyrehabilitated and serves a bitumen patching and resealing gang.

7. DCC has, on its own initiative, since 1989 made some efforts tostrengthen the City Engineer's Department through the recruitment ofseveral professional staff. It has also undertaken to reopen roads thathad been rendered impassable, mostly through simple grading operations.

S. Program Objectives

S. The IDA-financed program would provide support to the HLghwaysand Drainage Division in the City Engineer's Department of ICC in order tosafeguard past investment In road and drainage infrastructure. The programwould be a 3-year continuation of the EEC-financed ERMIRUM program which isexpected to be complete at the end of 1990191. The program will precludethe need for expensive reconstruction in the future. It will also carryout traffic management improvement measures to improve traffic flows andsafety.

9. More specifically the program would seek to:

(a) finance the periodic maintenance of roads, drains andsidewalks through the employment of contractors; and

(b) provide support (equipment, tools, performance allowancesand road maintenance materials) in order to increase theDivision's capacity for routine road maintenance by forceaccount;

(c) finance the rehabilitation of four of the six ICC depotsserving the maintenance districts;

(d) provide operational assistance to establish a sustainablepavement management system and to improve the generalmanagement and operations of the Division.

mu P . S of 4

C. Detailed Descriptiom of Part m

10. The program would address the moot critical maintenace needof Kampala's road and drainage network and progressively expand theHigbways Lid Drainage division's capacity to maintain the system. IDAflnance would support a 3-year rolling program begi8ning in 1991192, afterthe completion of UC-financed program which began In 1988189. The ezactcomposition of the program will depend on progress achieved during NEC'speriod of assistance. It is anticipated that the level of funding to beprovided will be adequate to provide routine maintenance to about 120 km ofbitumen road and 60 km of gravel roads annually. In addition it willsupport the a program of periodic maintenance to 30 km of bitumen road and20 km of gravel road during the three year period. Details of the program,which also includes supporting equipment, tools, materials, andrehabilitation of depots, are shown in the attached appendices 1 and 2.

D. Proara Costs and fiUsUcJJ

11. The total base cost of the muicipal roads maintennce programis estimated at US$5.90 million, of which the foreign exchange component isexpected to be 76Z. These figures exclude technical assistance andtraining for maintensace operations and management, included under thegeneral assistance and training package to be provided to KCC.

VMCIAL MM UADWOSC _SNam cuosmu&iNo 1M0 bem cots (exs cuding ceetl-go else)

w. t X W~~~~~unts ILA" FOi T1U110. ~ ~~~~~~Col I Om

S*sbIItt1Is0 f sbl.teOms SSPets (4) 72 8o

SubtIu re1d_i t... (b IOCC)Peeeersm.eAl eas,e. 76 0 76mteis a Us 2Feet, Splmt, Tol 7 an 46

Pwdlte reed mlemeaee

TOTAL "a COSms I,m 4,8 1.00

page n of 4

B. I aleaeutati.n

12. The KCC's City Engineer's Department would be the keyimplementing agency through its Highways and Drainage Division. Thetechnical coordinating comuittee chaired by the Deputy Town Clerk would beresponsible for overall coordination and monitoring of the program.

13. Before the beginning of each fiscal year, the annual maintenanceprogram proposed and agreed by KCC will be submitted to the Bank forreview. The program would indicate the works to be contracted,identifying each road length by name, the Imported materials content of theannual program, and the economic rate of return for the annual package ofworks. Selection criteria for roads would be the same as those for the EECfinanced program (Para. 5). Tender documents for civil vorks, vehicles,plant, and equipment will be prepared by MCC with the assistance of PCUand will be submitted to the Association for review prior to the beginningof each financial year begimning October 1, 1991.

14 The proposed program would benefit from the experience gainedduring the implementation of the EEC-financed ERM and RIK program. Despiteearly objectives to involve smaller local contractors in routine andperiodic maintenance works through training, provision of equipment andmaterials, their performance under the EEC program has been found to beless than satisfactory and expenslve. Contracts for resealing (includingreconstituting base course) have been found to be cheaper and of betterquality when done by larger contractors. It is therefore proposed that allperiodic maintenance would be carried out by contractor procured under ICB.Local contractors will either work as sub-contractors to larger civil workscontractors, or would focus on drainage and sidewalk rehabilitation.

15. It is proposed to concentrate XCC force account activities onroutine maintenance suck, as sweeping, drain and pipe cleaning, marking,minor patching, pothole repairing. grass cutting. Kampala has been dividedinto six road maintenance districts, each one of which will be theresponsibility of a District Maintenance Engineer. Each district will havea complement of workers organized into units capable of undertaking routineroad and drain cleaning, and patching. A total of 35 skilled and 100unskilled workers will be required, furnished with suitable depotfacilities and equipment. Provision has been made for incentive allowancesto both supervisors and labor. based on performance output. Provision hasalso been made for the trainfing of engineers and tecbnicians within theprogram, through short courses, on-the-job training and attachments (Amex7).

16. Vehicles, equipment and tools amounting to US$0.4 million willbe procured through ICB procedures. The rehabilitation of the four KCCdepots (US$0 .2 million) would be carried out by contractor procured underLCB. Road maintenance work carried out by contractors (US$5.0 million)would be procured through international competitive bidding for standarditems at agreed rates at the beginning of each of three years of theprogram.

ANN 8Appendix 1Paeg 1 of 8

MUCIPAL ROADS MAINTENANCE PRORMDETAIL COST ESTIMATES

May 1990 ba osts (excluding contingencies)

A. REHABILITATION Of MAINTENCE ODEPOTS

Rd. Ite. qty Unit ILocel Foreign TotalNo. CO" I US '000)

1. Nakivubo Depot - - I 18 82 02. MngoO Dpot - - I 18 82 608. DugolobI Depot - - I 16 82 s04. f aempeD.pot - - I 18 82 so

Sub-Total Roh*bl I itation of Dpot. 1 72 128 200

9. ROUTINE MAINTENANCE: KCC DIRECT LAORPerfomanco Allowanae

Re . Item Qty Unit ILocal Foreign TotalNo. Cost I (USS '000)

Performance All wanes: I1. mUnaorent/Sup.rviston I 16 - 152. General workors I 8O - 60

Sub-Totsl P eformaneo Al lownceu I 75 0 75

C. RUTINE MAINTENANCE: KCC DIRECT LABORRoad Meintnance Materials

Rtf. Ite Qty Unit I Local Foreign TotalNo. Coot I (USS 'IWO)

1. Situ." I s 6O sO2. Cemet 1 2 14 1B8 Aggrepetee .runh.rrun 1 20 65 754. Road marking point I - 12 12S. Moullaneoue (kerbs, pipes,

mo.h covers, etc) I 6 12 16S. Sign., seurity light, et. I 7 85 42

I-Sub-Total KCC Direct Labor-" t rluls I SIC too 223

ANNEX aAppeedia 1Pop. 2 ot 8

0. ROUtINE MADNTENANCE: KCC DIRECT LAW RPlant, equlpment and tools

RNt. item qxy Unit I Local Foreig ""K.No. Cost I (US '000)

4eOndtol I1. Shovels 100 0.015 I 0.2 1.8 t2. Picks, hoes s0 0.015 I 0.6 0.t 18. Broom (a soe.) J10 0.010 I 8.0 -4. Pang, 75 0.000 I 0.5 0.t 15. Whelbarros 45 0.100 I - 5.0 66. Protective clothes 100 0.090 I 8.0 6.0 9

Drain gleaning equlpment7. Cloening spirals 2 1.800 I - 4.0 48. Winch *to 2 J0.000 1 - 60.0 s09. Wheeled loader 0.5M3 1 40.000 1 - 40.0 40

Plant (transport)t0. Plek-ups 2 20.000 1 - 40.0 4011. Tracteor A trel lore 2 46.000 1 - 90.0 s012. Motocycl. 9 2.400 1 - 7.0 718. cycles 12 0.200 1 - 2.0 2

Plant (patching)14. TaMper/r_mor 2 19.000 I - U.0 J61s. Compaction plate 8 4.200 1 - 18.0 1516. Smell roller 2 22.000 1 - 44.0 4417. Bit hend sprayer 2 4.000 1 - 0.0 81B. Cofncreat *xer a 6.000 I - 15.0 1s19. AssotW dpre, parts - - 25.0 23

Sub-Totsl: Tools, Equipment, Plant I 7 898 402

E. PERIODIC ROA MAINtENANCE BY CONTRACTORS

Ref. Item qty Unit ILocel Foreign Totalllo. coot I (US5 0o0o)

1. Contract works (US31.6 million par user) I(Includes: resa_ling, repeir.; r hab of 1 1850 3650 5000sidwalks, drains) I -

I 1850 860t 5000

Note: Annual unit costs of reed alatenene per kil ester asumedas fol low:

Routine Gravel US1,000Bitumen US l,B00

Periodic Gravel USS30,000Bitumen US1380,000

Source: Basd on K(mple City Roads: Maintnance Activitiesand Cost Estimates (In9 - 1908), October 199.

Pq.$3 of 3

ICIN AL RODS RES4m ATIN An mAnTSoCE PROMRAM

MADInINA PERFOMANCE TAROM

Control Dletrioa Outer Sot.1.tNaklvubo Kololo Bug.l.bl Wan K _mewp. Ubslndye Total

Blt... Roadl (km) 5.2 42.5 8.2 70 sO 85 270

of whicb:- "lnt. Ia 19" 1i 10 * 12 5 S a

( It n 198) OM (2m (2m 1) (1 (17X (IN (2- 1l In t1992 sO 20 15 U 12 1S 117

(I a. 19l2) () (47) (81 (81 (401) (481) (481)- a In. InS o0 40 0 22 25 222

( I a1996) (O2M (94) (93) (7s) (78 (71) (

Gravel Roads (kim)0 0 12.7 45 70 60 17t

of which:-"int.tn191 - - (8) 0 0 0 u

( In los) _ _- _- - (a1)-minat.tn1962 - - 10 1a SC 15

(v n11 2 - - (7 (81 ( (81) (8-"X*at.199C - - 12.7 82 s0 # 180

(1 I 199) - - (10t5 (7) (1x) () (781

Grovel + Bit"" 54.2 42.5 50.9 115 100 85 448

AM= 4page 1 of S

1 m-,M for StfUrban nvestment Planin Canac

Arn. 4

1. Uganda's capacity to undertake urban planning activities is at a werylow ebb. The Physical Planning Department (PPD), now under WOHUD, sufferedyears of neglect and outright destruction In the 1970's. Town planning at thelocal level was established only in Kampala as a section within the CityEngineer's Department (1968). This lack of capacity has come at a time whenpost-war urban population growth is begianing to Increase, creating a growingneed to plan for the appropriate expansion of urban services The back-log ofplanning work required to regularize the informal urban growth vhich occurredover the past 15 years is staggering. There is an urgent need to rehabilitateurban services not only back up to their pre-war levels but increase thembeyond to meet current and future needs. Fundamental to the achievement ofthis goal is the need to strengthen the country's urban planning capacity atnational and local level.

2. One of the ways in which the Project will achieve this goal will bestrengthening PPD and the Town Planning section within KCC. A related andcomplementary part of the proposed strategy would include a study of theinstitutional and legal aspects of physical planning as contained in the Townand Country Planning Act (1964).

D. Oblectives

9. The goal of the program would be to create a capacity to plan andevaluate dynamic urban investment proposals as opposed to the preparation oftraditional static master plans. The project aims to achieve this goal byfinancing a task force to undertake a two-year exercise of urban investmentplanning with on-the-job training for planners, economists, engineers andfinancial analysts assisted by foreign and local expertise. The objectives ofthe program would be tot

(a) train 12 Ugandan planners with different professional backgroundsand an equal number of planning assistants in modern techniques ofurban investment planning;

(b) prepare outline structure plans and written statements coveringthe development of Kampala and at least one other local authorityfrom 1990 - 2000;

(c) prepare affordable investment programs, including relevant detailarea development plans, preliminary engineering designs and costestlimtes, for priority service sectors, for the period 1993 -1998;

(d) organixe a plamning and programming unit within DCC.

ANRMX 4Page 2 of 5

C. Detailed Description

4. The program will finance a two-year effort to train a core team ofplanners selected from PPD and KCC. The task force would produce up-datedoutline structure plans for Kampala and at least one other urban counciltogether with detailed action programs justifying capital investments ontechnical, institutional, financial and socio-economic grounds. The workwould be undertaken by a multi-disciplinary team working under the directionof PPD's Chief Physical Planner in MOHUD. The team would be assisted by alead planning advisor with a background in economics and urban financialanalysis and extensive experience in carrying out strategic investment-oriented urban studies. The team would be supported by a wide range of shortand long-term specialist expertise obtained both locally and abroad. Ugandantrainees would be recruited from both PPD and the involved local authorities.Detail terms of reference for the Kampala study are contained in Appendix 1 tothis Annex. The program will also include a similar but appropriately scaled-down study for at least one other urban center, possibly Jinja. The initialphases of the work will be facilitated by a training program for physicalplanners financed by GTZ.

5. In view of the importance of transport and traffic management for theefficient functioning of Kampala, the program will include a transportationand traffic management component for the city and its environs. It will forman integral part of the outline structure plan exercise and recommendpraSmatic priority traffic management measures aimed at maximizing utilizationof existing networks. It will also propose demand-driven investments toensure incremental improvements based on need and affordability.

6. Project packages consisting of the proposed five year capital programfor the period 1993 - 1998 for each local authority will be prepared, completewith financial plan. They will be prepared in such a manner that they can besubmitted to an international bank or financing agency for appraisal andreview.

7. A serious constraint for effective planning and all aspects of landmanagement in Kampala has been the paucity of up-to-date and reliable maps atappropriate scales. Aerial photography, fina-.ced under PPF P487-UG was flownon February 9, 1990. Ground control (placing of co-ordinated survey points)and the preparation of photomosaics at 1s5,000 for urban data collection areproposed for financing under another IDA credit (T.A. I1I, Credit --- ) earlyin 1990. The Project provides financing for the production of up-to-date linemaps with contours of the Kampala area based on this aerial photography atscales of 1:2500, llO,000 and 1s25,000. Mapping would be carried out inliaison with the Ministry of Lands and Surveys.

AMNE 4Page 3 of S

D. Costs and Fimancing

8. The estimated total cost of the urban planning exercise, including themapping and planning legislation study, is US$2.66 million. The total costof producing up-to-date topographical maps is US$1.3 million, of which US$1.)million is sllocable to the Project with the balance of US$0.3 million beingfinanced by TA III. The estimated total cost of the planning exercise,detailed in tC_.e table below, is US$1.26 million, including US$0.6 million fortraining being financed by GTZ.

Cot Esti"mt(US8'OO3)

Local Foreign TotalMAPPINGAerial photos 0 45 45Ground control (by TA III) N/A N/A N/AMapping 0 1,000 1,000

TOTAL MAPPING 0 1,045 1,045

URBAN DEVELOPMENT PLANNINGTALoad advisor 23 203 225ST planning (foreign) 30 270 300ST planning (local) 48 0 48Training a i sor (GTZ) 36 324 390ST traininy (OTZ) 25 22C 260Local partlcipant *llowancer 0 29 29

Vehicles and Equipmentvehiclos 0 s0 s0drawing offic equlpment 0 20 20PC and acessories 0 10 10training aids 0 10 10

Office returbishmentpaint, glass lighting, etc. 7 10

Operating xpenses 4 10 20printing, stationery, *tc.

Planning legislation studyStudy 10 90 100

TOTAL URBAN PLANNING 179 1,283 1,4U2

ANNEX 4Page 4 of 5

B. Implemeutation

9. The on-the-job training component of the program would be financed byGTZ and be implemented under the direction of the Chief Physical Planner, PPD,MOHUD. Ugandan trainees, selected on the basis of prior academicqualifications and merit from PPD and KCC, would receive their regular salaryfrom their parent institution plus a consultant fee of the equivalent ofUS$100 per month in local currency for specific tasks successfully undertakenas part of the program.

10. GTZ has committed funds equivalent to DM 1.1 million towards the cost ofproviding 24 person months of a training advisor, 10 person months of short-term specialist expertise, drawing office equipment, office refurbishment,and operating costs. The training would begin in May 1990 and would extendthroughout the two-year period of the program. During the first 10 months ofthe program, the training effort would focus on data collection and analysisand preliminary structure planning exercises for Kampala (Tasks IV.1 throughIV.13 and V.1 and V.2 in the TORs given in Appendix 1). In addition to thetraining of participants in general physical planning, GTZ-financed specialisttraining in transportation, urban and infrastructure planning including theuse of relevant computer methods will be carried out with the assistance ofshort-term expertise. Training of.planning assistants will also beundertaken.

11. Early in 1991, zhe team of physical planners concerned with Kampalawould be supplemented by additional planning expertise financed under the IDAcredit. The expertise would including a lead urban economist/financialanalyst and other specialists to form a task force working with PPD and KCCofficials under the direction of the Town Clerk. A review of work undertakento date will be done and the need for additional data collection and analysiswill be identified, especially in the non-physical planning areas. Afteracquisition and analysis of the additional data, the task force will preparealternative structure plan options. The options will be reviewed by asteering committee composed of relevant government and non-government bodies,and the preferred alternative will be selected. The task force will documentthe preferred structure plan in final form and identify priority actionprograms. The preparation of affordable investment programs, includingpreliminary engineering design and cost estimates, for priority servicesectors, for the period 1993 - 1998 would be done. GTZ assistance willsupport the preparation of detailed area physical development plans associatedwith the investment programs in furtherance of the training objective. Theinvestment programs would be in accordance with the socio-economic realitiesfacing the urban centers. A small capital budgeting unit would be establishedunder the Town Clerk in RCC to begin the process of integrating the proposedinvestment programs into the city's overall development program and toestablish an implementation and monitoring capability. A similar strategicurban planning effort for the municipality of Jinja will also be undertaken.

12. The planning expertise required to complement the skills and knowledge

AMNEX 4Page 5 of 5

of the Ugandan core team will be supplied by consultants whose qualifications,experience, and terms and conditions of employment shall be satisfactory toIDA. Such consultants shall be selected in accordance with the Guidelines forthe Use of Consultants By World Bank Borrowers' of August 1981.

ANNEM 4Appeudi? 1

Page 1 of 14Terms of Reference

Prevaration of an urban Development Plan and Action Prorms

for the

Citq of Kamwala

I. B&CKGROUND

An urban planning and management system for Kampala needs to bedeveloped with emphasis on:

(i) coping with growth;

(ii) improving the level of productivity of all inhabitants by* the provision of services, and fostering the private sector,

particularly the informal private sector;

(iii) improving operation and maintenance practices; and

(iv) developing fiscal and human re irces at the local level.

The Government of Uganda seeks consultancy services in addressing theseissues and problems.

n. OBJECTIVES

The objectives of this assignment are to s

(a) prepare a structure plan and written statement covering thedevelopment of Kampala 1990 - 2000;

(b) prepare affordable action programs, including preliminaryengineering design and cost estimates, for all service sectors,for the period 1993 - 1998;

(c) prepare forecast capital and revenue financial statements for allagencies involved in the action programs, the financial statementsto include forecast balance sheets and proposed financing plansindicating sources and applications of funds; and

(d) recomnedations for financial and institutional reform includingthe establishment of a planning, programming and budgeting systemfor the city of Kampala.

In meeting these objectives particular attention would be given tos (i)creating a "climate of opportunity' in which new comers can be speedilyabsorbed into the urban system; (ii) government interventions and actions

ANREM 4Appendix 1

Page 2 of 14

which can promote productivity in the private sector, particularly theinformal private sector; and (iii) operation and maintenance procedures andpractices.

III. APPROACE TO THE TASK

The planning team(s) engaged in this work should realize that they areinvolved in a very dynamic situation. It should also be realized that, atbest, the quality of the data will be crude. This suggests that the existingsituation should be assessed as speedily as possible. A team of experiencedprofessionals should get a quick 'feel' for the workings of the city and, tothe extent possible, understand the private sector and, in particular, theinformal sector.

After a review of the existing situation (including a review of thefiscal resources), the tasks call for quick sieve, deficiency and thresholdanalyses, followed by demographic and economic projections. The structureplan scenarios will be quickly developed from alternative development patternsand transportation networks; the preferred alternative will then bereconmmended to the government.

Action plans together with institutional and financial reforms will beprepared which fit into the framework of the structure plan and are inaccordance with the socio-economic realities facing the city. The process ofimproving urban management will then be charted.

Finally a project package consisting of the proposed five year capitalprogram for the period 1993 - 1998 will be prepared (complete with financialplan). It will be prepared in such a manner that it can be submitted to aninternational bank or financing agency for appraisal and review.

The work will be carried out in three phases*

Phase One: Data Collection and Analysis

Identify and review existing conditions;

Review on-going programs and committed development;

Planning analyses.

Phase Two: Structure Planian

Preparation of structure plan and written statement;

Identification of actions programs statement.

Organization of a planning and programming unit within KCC

ARM 4Appendix 1

Page 3 of 14

Phase Threes Action Planning

Design of action programs, preliminary engineering and actions to betaken to implement in the five year 1993 - 1998 program.

In undertaking the work the planning team will be expected to showjudgment in interpreting the 'spirit' implied in the tasks and scope of work,rather than the 'letter' of the written words.

IV. PHASE ONEs DATA COLLECTION AID ANALYSIS

1. Identify Existing Conditions

Identify existing urban conditions in the Kampala area. Morespecifically, map, review and comment upon the following:

Land Use: Classify and note the areas of land under various forms of urbanand agricultural. Identify land in public and private sector ownership,including mailo land. To the extent possible ascertain land values (legal andillegal) over a cross section of the city area. Locate on the maps allschools and sites of learning, note the number of students by age and academiccategory. Carry out a similar exercise in respect of clinics and hospitals,noting in this case the number of hospital beds and the capacity and type offacility. Identify and locate any modes of activity including bus stations orterminals, markets, primary and secondary shopping centers.

Obtain information on the urban infrastructure systems and illustrate thefindings on maps. Including the followings

Water Supplys Areas served by: surface and ground water sources; couunitystand posts or water kiosks; shallow wells; house connections or any othermeans of supply. Ascertain the levels of service available to consumers i.e.quantity of water available by area, in liters per capita; hours of supply andreliability of the service; pressures (where applicable) at the top; any otherrelevant information.

Sewerage and Sanitation: Areas served by a water-borne sewerage system;septic tanks, pit latrines and any other disposal system. Note location,condition and capacity of any sewage treatment works and 'end-use' ofeffluent.

Transportation: Identify the 270 kilometers of bitumenroads and approximate120 kilometers of gravel roads in the city; locate the roads (all weather andunsurfaced) used as bus andlor taxi routes. Identify industrial andcommercial areas where access roads are urgently required. Note and recordthe types of street and security lighting in the city; ascertain the numbersof poles and light sources by mounting heights, lanterns and bulb types.Identify the extent and levels of service throughout the Kampala area.

ANNEX 4Appeud~z 1

Page 4 of 14

Drainage: The normal top water levels of Lake Victoria. Note thebuildings and premises and other matters which may be at risk from flooding(if any). Identify the drainage basins and watersheds together with areasserved by natural and artificially constructed culverts and drains.

Solid Wastes: Identify the location of tips and dumping grounds, wherecollection crews are assembled and vehicles garaged; and identify and mapareas by level of service. Identify areas of little or no service. Assess thesurplus capacity of tipping or dumping grounds.

2. Review On-Goin2 Program and Committed Develooment

Review, map and comment upon on-going programs (both physical andsupport) being carried out in the Kampala area bys

(a) the private sector;(b) government - national, local and para-statal agencies;(c) non government organizations; and(d) any other agency.

Identify those programs supported by multilateral, bilateral and otherinternational aid agencies. Differentiate between hard and soft commitment.Hard commitment refers to ongoing programs or where funding is secure and/orcontracts exist and soft commitment refers to programs under activeconsideration, but where funding has not yet been secured.

3. Sieve Analysis

Review the records of the top water levels of Lake Victoria and identifyareas at risk of flooding from 5, 10 and 15 years storms, andlor flood levels.

On maps of a suitable scale, identify: -

(a) areas suitable for agriculture, market gardens, and other types offarming;

(b) areas needed for security and other related purposes;(c) areas affected by noise levels;(d) areas of opportunity for a particular type of development or

environmental enhancement;(e) areas affected by pollution;(f) areas which, for one reason or another, are unsuitable to

buildings;(g) areas where the 'water table' is high or close to the surface; and(h) any other relevant aspect affecting the physical/environmental

aspect of urban development.

AMUU 4Appendix 1

Page 5 of 14

4. Threshold nal8sis

On maps of a suitable scale, identify areas which should not berecommended for development without crossing an infrastructural threshold(e.g. water supply intake, airport relocation, etc.).

5. Deficiency Analysis

Assess each of the 5 districts of Kampala (Kawempe, Nakawa, Makindye,Rubaga and Central) for infrastructural or special service deficiencies.Carry out the work in such a way that approximate cost estimates can besubsequently prepared for upgrading. Inter alia, the study should include:water supply, sewerage and sanitation, access to bus routes, street/securitylighting, electricity, solid waste removal, access to employment opportunity,telecommunications and access to education, health and social facilities.

6. Urban DeveloAment Models

From an analysis of the types of shelter development in representativetypes of residential neighborhoods, sketch physical development models fortypical units of land area and/or number of population. Estimate the costsper unit area and per capita of various levels of infrastructural and socialservices.

Comment on the density, efficiency and suitability of the residentiallayouts and the capacity to respond to the needs of the community in thefuture. Discuss the capacity of the beneficiaries to afford various levels ofinfrastructural and social service provision.

Prepare, sketch and ascertain costs for a number of urban developmentmodels which are considered to be appropriate to the need of the community andin liae with socio-economic realities. Include development models for:

(a) all types of new development;(b) replanning and upgrading of unplanned development;(c) infilling (if considered possible) in planned areas;(d) incorporation of rural (usually river side) villages with new

development ; and(e) any other relevant form of development.

7. Traffic and transportation

From a review of licenses and other statistics, note the historicalgrowth in the number of vehicles In Kampala by type.

Obtain and review any road accident statistics which have been recordedduring the last five years.

ANMEX 4Appeadix 1

Page 6 of 14

Identify a hierarchy of streets and classify them as primary,distributor and service streets. Make a crude assessment of the existingvalue of the assets.

Carry out an overview assessment of the programs, depots, equipment andfacilities available for highway, foo'way and street lighting maintenance.Review existing maintenance practices. Comment on the productivity of thestaff and equipment. Comment on a role or otherwise for the private sector.

Identify the roads and terminals used by public and private transitoperations. Write a brief report on the transit services available in thecity (including taxis). Assees the number of passengers carried. Discussfares, purchasing and maintenance of vehicles and other relevant matters.

Review any recent traffic surveys and counts which have been undertakenrecently. Organize and undertake an appropri.ate origin and destination surveytogether with spot checks and screen line counts. The survey should not be anelaborate affair. It should be undertaken at a level which will give areasonable indication of traffic and parking ststus and enable peak hourcirculation flows to be established. Carry out a vehicle parking survey inthe core area of the city. Comment on the need or otherwise for improvedparking control and off-street vehicle parks.

Identify any missing links or unmade streets which if make up wouldcomplement the road network. Prepare basic circulation plans for the coreareas of the tree main townships.

Review and assess the implication for streets, for highways and transitservices of the various development and upgrading models and structure planalternatives.

Prepare a planning report with costs outlining an affordable phasedprogram for transportation highway construction, street lighting and relatedmaintenance needs up to the year 2000.

8. Water Supplp

(Refer to IDA Water Supply II here)

Review ongoing rehabilitation and extension programs

9. Sewerage and Sanitation

Carry out an overview assessment of the sewage treatment plants, depots,pumping chambers and transmisson mains of the water-borne sewerage systemserving part of Kampala. Review ongoing rehabilitation and extensionprograms. Prepare up to date maps of the system and undertake a crudecondition assessment and valuation of assets. Comment on the use andpotential use of treated effluent. Review existing operation and maintenance

ANNMX 4Appendix 1

Page 7 of 14

practices and comment on the productivity of the organization responsible forthe operation and maintenance of the sewerage system.

Roughly assess the extent to which sewerage is dealt with by means ofseptic tanks and leaching wells. Ascertain the needs of sludge removal andthe organizations (public av. private) for dealing with septic tank sludge.Review the designs and costs of septic tanks.

Assess other means of disposing of household and body wastes. Commenton the need for sullage drains and the types and use of pit latrines (and anyother means of dealitg with body wastes).

Comment on the existing practices and the opportunity (or other wise)for recovering the costs of the sewerage and sanitation services. Discuss apossible role for the private sector.

Review and assess the practical and affordable opportunities to extendthe water-borne system together under the various development and upgradingmodels and structure plan alternatives.

Prepare a planning report, with costs, outlining an affordable phasedprogram for improvements in the sewerage and sanitation services up to theyear 2000. Discuss, inter alia, the need for education and support programsto sustain the physical delivery of services.

10. DrinaRe

Review the rainfall statistics, permeability and run-off characteristicsfor the various areas forming Kampala. Ascertain the likely run-off fromstorms forecast to occur at 5, 10, 20 and 50 year intervals and relate thefindings for the likely top water levels of Lake Victoria.

Justify and recommend the storm frequency and rainfall intensity whichshould be the basis for drainage design in Kampala.

Identify routes (e.g. streams and valleys) where drainage and stormflows can discharge naturally; identify routes where pipes and culverts willbe required.

Undertake preliminary overview designs and ketches, including costestimates to cope with the run off from the various development models andstructure plan alternatives being developed elsewhere (up to the year 2000).

11. Refuse Collection and Disosal

Review the existing practices, staff, equipment employed, equipmentmaintenance facilities, costs and all other relevant aspects of refusecollection and disposal in Kampala. Assess the productivity of the labor force and note the extent to which

ANNEX 4Appendix 1

Page 8 of 14

recycling takes place. Hap the boundaries and review the existing disposalsites and dumping grounds. Assess unfilled dump capacity and residual life.Comment on the disposal practices and need for improvement.

Review the sources and generation of solid wastes including anyparticular hazardous or noxious wastes. Assess the amounts (weight andvolume) of the wastes, its composition and its moisture content. Assess theopportunity (if any) for recycling.

Assess the extent to which solid waste generation will increase and/orchange up to the year 2000. Identify suitable land fill sites and the extentof civil engineering needs, including costs estimates to make themoperational.

Consider ways and means of improving solid waste collection and disposalpractices. Evaluate the alternatives by reviewing costs and benefits andrecommend a preferred system which will serve the city up to the year 2000.Consider whether the preferred system should be administered and operated bythe municipality or the private sector, or a mix of both.

Prepare a planning report of the findings including order of magnitudecosts.

12. Electricity

Review needs for electic power with UEB.

13. Telecommunications

Review needs for telecommunications service with UPT.

14. Exieting Institutional and Financial Standing of the Kampala CityCouncils and Concerned Parastatal Institutions

Carry out Institutional assessment of all levels of local governmentserving the Kampala area, including the National Water and Sewer Corporation.Briefly comment on the duties and functions of the various units and on thegoverning and staff structure together with age, education levels andqualifications of staff.

Review the links with the national ministers and parastatals and theextent to which national government policies and programs impact on the day today management of the capital area.

Obtain 'as built' or prepared measured drawings of all offices, depotsinstallations and facilities owned and operated by the local governmentagencies (except schools and clinics). Prepare a report on the condition,suitability, standard of furnishing and office equipment.

ANNMX 4Appendix 1

Pa8e 9 of 14

To the extent possible review the local government and parastatal links(direct and indirect) with the private sectors. Comment on the extent towhich any services or works are contracted out and the degree of control orlicensing of the private sector undertaken by various units of localgovernment. Comment on the possibility (benefits and costs) of privatizingany municipa' service.

15. Demotraphic and Social Analysis

Review the results of the last census and any subsequentdemographiclsocial studies recently carried out by the government ministries,universities, NGO's and aid agencies.

To the extent possible ascertain the number of people which have come tothe capital area since 1981 together with the natural increase which has takenplace since that time. Crudely indicate the 1991 population by wards andassess if probable the likely age breakdown.

To the extent possible assess the number of people living in the Kampalaareas

(a) without legal title to Lt d;(b) without identity cards;(c) of primary and secondary school age; in parallel with this ,task

assess the number of children not attending primary school;(d) in the active labor force;(e) who are entering the active labor force on an annual basis; and(f) any other relevant matters.

Draw up a list of internationally accepted socio-economic indicatorswhich reflect the "Situation in Kampala.' Note indicators which may bedeteriorating or improving.

To the extent possible assess the extent to which there is literacyretention and, in association with the economic studies and work concerningthe informal sector, endeavor to obtain a crude measure for the productivityof the labor force.

From a review of normal migratory trends ascertain the extent to whichmigration is taking place (i.e. without the effects of war, famine or otherextraneous influence).

From a review of births and deaths and migratory patterns make a roughestimate of the annual rate of population increase. From field interviews anddiscussions assess the possibility of some families returning to their formerhomes and tribal territories. Crudely forecast the likely population of thenational capital region in 1993 and 2000.

AME 4

Page 10 of 14

16. Economic Base Analseis

Undertake an economic base study of the Kampala area. Note labor andcapital employed in the formal agricultural, industrial, commerce, businessand service sectors. Review the work being done elsewhere on the informalsector and to the extent possible, ascertain the links between the formal andinformal sectors. Review historical trends.

Review the results of any household budget surveys carried out byGovernment in order to assess the social dimensions of the structuraladjustment process by undertaking spot field surveys and any other methodconsidered appropriate. Crudely calculate the salaries and wages entering theKampala area. Postulate on the extent to which salaries and wages (use apercentage theory) can sustain the provision and operation of municipalservices. Comment on standards and the likely level of services which wouldbe affordable.

17. Land Markets and Real Estate Analysis

Undertake a brief land market and real estate analysis to ascertain theextent to which property and buildings change hands (legally or illegally).Review the roles of the private (including the informal) and public sectors.

Prepare a short report outlining the findings and recommendations.

18. Infrastructure Standards. Buildingt BY-Laws and Construction Codes

Review the infrastructure standards and costs (i.e. capital costs andoperation and maintenance costs) of municipal infrastructure. Comment on theaffordability and suitability. Discuss the interaction between density,standards and affordability.

Review the town planning and building by-laws and construction codes.Comment on their suitability to promote as well as control development. Makerecommendations for change.

19. Social SuMport Programs

Review the extent to which the local agencies are involved in education,health and social programs and the extent to which the buildings areconstructed by self-help, staffed by local agencies and supported by theprivate sector, NGO and other donor agencies.

Review the designs and needs of additional facilities in order to makeup existing deficiencies and cope with growth. Prepare capital and revenuecost estimates and assess the impact on local agencies finances.

ANNEX 4AppendIx 1

Page 11 of 14

Iterate the findings with the consultants preparing the variousdevelopment models and structure plans alternatives. Recommend phasedprograms with approximate costs.

20. Ewvironaental and Energy Considerations

Formulate and consider a number of measures which could improve theliving environment and/or conserve energy (e.g. tree planting and the use ofsolar wind energy).

Comment on the phvsical, financial and economic viability of the ideasand recommend and cost any pilot programs which could be tested.

V. PAS TWO: STRUCTUE PLANIN

1. Structure Plan

Take in the outputs from the various planning reports, economic andsocial projections and development models, integrate the outputs with a numberof transportation and highway alternatives and develop a number of structureplan alternatives for the year 2000.

Critically review the alternatives for physical, financial and economicviability; justify and recommend a preferred alternative.

2. Written Statement

Describe the assumptions made in making the projections and plan; carryout & number of sensitivity tests based on assumptions which vary costs -adbenefits. Assess the risks and critical inputs needed to achieve thestrategies and objective-s of the plan. The statement should include financingplans and forecast flows of funds together with forecast balance sheets foreach agency for the period 1993 - 1998.

3. Identify Priority Action Program.

Identify a number of action programs which should be undertaken in theperiod 1993 - 1998 and draw up design briefs and/or terms of reference, whichwill describe the preparation needs of each program. The programs should bechosen in such a way as they:

(a) address growth and deficiencies;(b) improve operation and maintenance;(c) create employment opportunities; and(d) develop human and financial resources at the local level.

Undertake a financial impact analysis of the proposed program on the budgetsof the municipal agencies and National Water and Sewerage Corporation.

ANX 4Apedix 1,

Page 12 of 14

Outline the policy, institutional, financial and legislative reformsneeded to successfully achieve the objectives of the preferred strategy.

4. PlarnlaR and ProaraumIx Unit

Indicate the staffing and institutional location of a planningprogramming and budgeting unit which will monitor and evaluate the programsand feed the results back into a continuous process of planning.

VII. PHASE THREE: ACTION PLANNING

1. Action Programs

Part of the output from Phase Two 4- the preparation of design briefsand terms of reference for the carrying out of an agreed list of actionprograms.

The scope of vork- for each program should outline the investigations,surveys, pilot studies, designs, calculations, institutional financial andeconomic justifications necessary to confirm the feasibility of the chosenprogram and prepare the preliminary engineering and cost estimates necessaryfor project appraisal.

It is important that the output of each action program be couched insuch a way that is will facilitate appraisal by an international financingagency. In order to do this it is necessary to prepare for each program(where appropriate), preliminary engineering designs, implementation schedulesand programs and cost estimates, (differentiating between foreign and localcosts and taxes); physical and price contingencies should be included for allproposals and recommendations. Note that some programs may not requireengineering designs, e.g., employment creation, housing finance, andinstitution-building programs.

It is important also to consider whether the private sector has a rolein a particular program.

Where appropriate, the consultants must indicate how the costs of theprogram can be recovered from beneficiaries by direct (and indirect) tariffs,fees, taxes and transfers.

It is envisioned at this stage that action plans will be required forthe following subject aress

(a) replanning and upgrading;(b) sanitation;(c) roads, street lighting and drainage;(d) areas (new) development (e.g. sites and services);(a) education and health;

AlIR= 4Appndix 1

Page 13 of 14

(f) employment creationt(g) housing finance;(h) legislative reform, institutional and financial development; and(i) community involvement and participation.

The definitive list will be decided at the end of Phase one. Theprograms should also consider the need for technical assistance inimplementation and operation.

VII. PEPORTS

An Inception Report will be written within one month of mobilizationfollowed by a Draft Structure Plan/Written Statement Report at the end ofPhase One. Separate 2ction plan reports will be written and summarized in adraft Summary Action Plans Report to be available at the end of Phase Two.

VIII. LEVEL OF EFFORT

Data collection and analysis of physical planning issues under Pha-e Ihat already begun with the assistance of GTZ. The consultant should thereforereview the progress to date and make proposals for technical inputaccordingly. It is envisioned that the level of effort required for Phase Twowill be approximately 6 person-months of expatriate and 10 person-months oflocal consulting time.

The level of effort required for Phase Three will depend on the findingsof Phase Two and the agreed list of action programs, and will be negotiated indue course. At this stage it is envisioned that the involvement ofexpatriates will reduce and the local consultants increase.

The consultants, in preparing their financial proposals (see separaterequest for proposals), will be expectsd to allow for incentive payments tocounterpart staff, the amounts to be stated in the letter of agreement.

IX. TIMING

It is envisioned that the work will be accomplished in twenty-fourmonths in accordance with the following timetable:

3 6 9 12 15 18 21 24

Phase One X X X(nine months)

Phase Two X X(six months)

Phase Two X X X(nine months)

ANNEX 4dAppeudi 1

Page 14 of 14

InternationalAgency Missions every four-six months

X. GORINT INPUTS

The government and local agencies vill use their good offices to assistand facilitate the work of the consultants in every way possible. To this enda high level steering committee will be set up to guide and assist theconsultants. The government and local agencies will also endeavor to seek andcoordinate the work of the donor agencies and NGO active in Rampala.Counterparts from Physical Planning Department, MOHVD and KCC will be selectedto work with the consultants in all the areas of research and endeavors. Thegovernment will provide office accommodation.

The consultants will be to provide transport and all necessary supportfacilities including communication and data processing equipment.

The goverrment will keep the consultants informed of relevant tectnaicalstudies which may be undertaken during the course of the urban developmentplanning program.

Any vehicles and data processing equipment used will ultimately betransferred to the new urban planning group on completion of the study.

AR 5Page 1 of 6

UGANDA

FIRST URBAN PROJECT

Provision of Serviced Landt Kawaala Sites & Services Schem

A. Background and Project Formulation

1. The doubling of Kampala's population over the past 20 years (toan estimated 750,000) has not been accompanied by a commensurate expansionof basic infrastructure, urban services, housing and community facilities.Uncontrolled land use in Kampala has created a haphazard pattern of urbandevelopment for which the provision of services is difficult and expensive.There is evidence of significant overcrowding and unsanitary livingconditions among the low and 'mixed-income' groups that make up more thantwo thirds of Kampala's population. In addition to the need to satisfy apent-up demand for affordable serviced land for lower and middle incomegroups, there is also a need to develop a framework for the rationalizationof existing land use to guide future development.

2. KCC has recognized the need for additional serviced land and formore orderly planning and development. It is in the process ofestablishing a Planning and Land Management Department, excised from theCity Engineer's Department, to be responsible for all long-term (strategic)planning, local planning schemes, planning control, development projects,surveying and land management issues. The designation of the department isavaiting ministerial approval.

S. The political upheaval which affected Uganda throughout the1970's and early 1980's effectively iso!ated the country from knowledge andexperience of contemporary policies concerning the provision shelter bymeans of assisted self-help efforts. The program presents an opportunityto demonstrate the benefits of the approach on a project basis while alsoattempting to improve urban management more generally. The only otherattempt to introduce the notion of aided self-help housing in Ugandaconcerns a community development project in the Namuwongo area of Kampalaaimed at extending infrastructure and services while replanning andreallocating some 900 plots to mostly lower income residents of an alreadybuilt-up area. The project, being implemented by the Ministry of Housingand Urban Development (tOHUD), has been receiving assistance from UNDP andUNCBS since 1986. The proposed IDA-financed program will draw on theexperience gained in implementing the Namuwongo project during a time ofhigh inflation, scarcity of building materials, lack of housing finance andskills shortages.

Al= SPage 2 of 6

B. Protram Obiectives

4. The objectives of the serviced land program in Kampala are:

(a) to demonstrate the feasibility of a housing delivery systemwhich relies on the public sector to service residential landwhich is subsequently developed by the private sector;

(b) to provide a range of opportunities for eligible households toconstruct their own dwellings on serviced land in Kampala; and

(c) to target this provision primarily towards the lower and middleincome population of the city.

C. Detailed Description of Program

5. The project will finance the planning and servicing of a peri-urban site at Kawaala located six kilometers to the north of the citycenter in Rawempe Division (See IBRD Map 224'2). The site is mostly publicland and is situated near areas of existing employment and trunkinfrastructure networks. A 47 hectare portion of the site will be servicedto provide approximately 1,000 plots, three quarters of which will be forallocation to low-income households. Standards of infrastructure will begeared to affordability and a policy of full cost recovery will be applied.Land will be set aside for the construction of social, community andcommercial facilities. Provision has been made for the construction of onetwo-stream primary school as part of the project.

6. The project site belongs to KCC although some privately-heldleases have been identified. The rights of existing residents occupyingland under customary tenancy will be recognized and compensation for cropsand buildings will be paid under existing legislation. Every effort willbe made to avoid the displacement and dislocation of existing residentsand, wherever possible existing structures will be integrated in the newlayouts. Only those affected by infrastructure easements, rights-of-wayand construction will be required to move. Estimated to number about 40households, they will be resettled within the project in plots demarcatedat the outset not to interfere with construction.

7. The plots, which range in size between a minimum of 200 squaremeters and a maximum of 450 square meters, will be serviced with bitumenroads, footpaths, storm drains, water supply, electricity and securitystreet lighting to minimal but improvable standards. Substructures forventilated improved pit latrines with concrete covers will be built as partof the civil works and sold with the plots. Designs for the waterreticulation will be approved by NWSC. UEB will undertake the provision ofelectricity for optional hook-up by project beneficiaries. Standards willvary: the larger plots, which will be sold at market prices, will havevehicular access and on-plot water supply; smaller plots, aimed at lowerincoms groups, will have mostly pedestrian access and be provided withwater at communal stand pipes (Appendix 1).

ANNEI 5Page 3 of 6

8. The site extends from the top of Kawaala hill northwards down toa low-lying marsh area. The soil comprises red coffee top soil withunderlying areas of laterite gravel and clay with good permeability. Partsof the site are steeply sloping, in a manner not untypical of Kampala,built, as it is, on seven hills. Surface water drainage has been designedto minimize the risk of soil erosion by ensuring that drains are adequatelysized and lined where runoff velocities are highest. Similarly,engineering studies have indicated the preference for all roads to besurfaced to preserve their useful life with minimal recurrent maintenance.The permeability of the soil has been assessed as adequate for the properfunctioning of ventilated improved pit latrines and septic tanks.

9. Three quarters of the plots will be 200m2 in area with thebalance being equally split between 200-300m2 plots and 300m2 and over.Plots generally have length/width ratios of 2:l, suitable for economicinfrastructure servicing. The majority of the plots are oriented parallelto the slope of the site to minimize on-plot stormwater accumulation and toreduce the need for deep house foundations. The physical planning layoutaccommodates plots for the following community and commercial facilities:

Facility Number Total Area

(a) Shops and markets 2 0.83 ha(b) Places of assembly 2 0.72 ha(c) Nursery school 5 1.19 ha(d) Primary school 2 3.05 ha(e) Secondary school 1 2.70 ha

10. The land use profile for the total 47 ha site is as follows:

Land use Total PercentArea

Power reserve 1.80 4Community facilities 8.49 18Roads/parking/paths 12.29 26Residential 24.58 52

Total 47.16 100

A total of 1,009 residential plots will be developed with a net density of41 plots per hectare.

11. Households will be offered a choice of standard core housedesigns suitable for self-help construction, expandable in a number ofdifferent ways, and which meet KCC approval. Beneficiaries will also beable to construct a house of non-standard design provided that it haspassed the technical scrutiny of KCC.

ANU 5Page 4 of 6

D. Proaram Costs and imancinc

12. The total base costs of servicing land at Kawaala is estimatedat US$3.4 million, of which the foreign exchange component is estimated at732 of the total component costs. These figures include engineering designand supervision costs but exclude technical assistance (Project Manager,Housing and Community Development Advisor) and related training. The sumincludes US$1.44 million in off-site costs, primarily for the constructionof roads (US$1.0 million) and bringing a high voltage electricity line tothe site (US$0.2 million), both of which will serve a much wider communitythan the project site. On-site base costs amount to US$1.6 million. Theestimated cost of the two-stream primary school is US$0.45 million. Basicbuilding materials in the form of cement and roofing sheets and brick- andblock-making equipment will be provided at an estimated cost of US$0.35million, including basic facilities for storing building materials andequipment on site (Appendix 2).

13. Off-site costs and the cost of servicing community facilitieswill not be passed on to beneficiaries, but will be charged to generalrevenue. The sale price of plots will include the full cost of land (valueof plot plus compensation), land survey, on-site roads and drains, watersupply, pit latrines, electricity (local distribution), professional feesand interest during construction. The larger, better located and servicedplots, numbering about 250, will be offered for cash sale at market prices.Proceeds of the sale, estimated to yield a net profit of US$0.4 million,and the cross-subsidy from commercial plots sales will be directed towardreducing the sale price of the 750 200m2 plots. The affordabilitty of thescheme to low-income households is demonstrated in Appendix 3. A servicedplot is affordable by a family earning Ush 36,000 (US$90) per month,assuming up to 30S of total income is allocated to shelter expenditure. Itis assumed that the initial superstructure occupied by the lowest incomegroup would consist of its existing dwelling made of temporary materialsmoved to the new serviced plot.

14. XCC will provide a form of long-term credit (after receipt of alOZ down-payment) to the lower-income beneficiaries which will enable themto amortize the cost of their plot over 15 years at a rate of 20? with oneyear's grace period. Project beneficiaries will be permitted to constructtheir dwellings to Grade II building standards using informal sources ofcredit.

E. Implementation

15. KCC will be responsible for the implementation of the program.In view of its institutional weakness, manpower constraints and lack ofexperience in implementing similar projects, KCC will need to developcapacity through external assistance, hiring of new staff and on-the-jobtraining. 'herever possible, existing departments, staff and procedureswill be used and built upon. The implementation modalities will, in anycase, be kept as simple and as transparent as possible. Some lessons can

AM= 5Page 5 of 6

be learnt from the experience gained in implementing the Ministry ofHousing and Urban Development (MOHUD) and UNDP/Shelter Afrique - financedNamuwongo project, particularly with respect to land acquisition,compensation, beneficiary selection, financing and cost recovery.

16. KCC will establish a technical coordinating and support unitheaded by a Project Manager to be hired expressly for this purpose andassisted by a Housing and Comuunity Development Advisor. The purpose ofthis unit will be to coordinate the functions of all KCC departments(especially City Engineer's, Treasurer's, Social Services) in implementingthe project, supervise the beneficiary selection and plot allocationprocedures, coordinate civil works construction with contractors, RCICommittees and residents, assist beneficiaries during the plotconsolidation stage and coordinate building materials and employmentcreation activities. In addition, the unit will also identify andcoordinate on KCC's behalf, with ongoing, complementary programs, such asthose financed under PAPSCA and NGOs, as well as developing collaborativeapproaches with private sector developers to provide low-cost affordablehousing on a broader scale than in the past.

17. Project beneficiaries will be selected using existing DCCprocedures but applying selection criteria specific to the project, asoutlined in Appendix 4 of this annex. These criteria differ from thosecurrently employed by KCC when allocating land insofar as they favor lower-income groups who are not land owners in the Kampala area. Existingresidents of the area will have first priority, after which plotbeneficiaries will be chosen publicly by ballot from among those that meetthe basic requirements. Plot application modalities will follow existingpractice, as follows:

(a) potential beneficiaries will purchase a plot applicationform from KCC following a public announcement;

(b) the plot applicants will submit applications withsupporting documentation (on residence and non ownership ofland in Kampala) to the technical coordinating and supportunit for initial screening and verification;

(c) applications which meet all the basic conditions will beforwarded to the MCC Land Allocation Committee for vetting;

(d) applications that meet all the criteria, have been verifiedand vetted by the Land Allocation Committee are then pooledand successful beneficiaries' names drawn by public ballot(e.g. at a football stadium) with all beneficiaries andother members of the public invited.

18. Prior to the start of construction, existing residents affectedby civil works (roads, drainage, footpaths, etc) will be compensated andallocated newly demarcated plots within the project area. An attempt hasbeen made to minimize such disruptions in the planned layout and someadjustments will be made during the final survey to mitigate displacement.

Page 6 of 6

The cooperation and assistance of the local RCI will be sought in dealingwith relocation and construction issues.

19. Civil works construction, which will be let as one package (withthe exception of electricity distribution which is to be done by UEB)through ICB to attract competent contractors, will be supervised by theconsultant Resident Engineer (RE). The RE will be assisted by staffseconded from the City Engineer's Department (Highways) who will be paid anincentive allowance and receive on-the-job construction experience. Thisstaff, consisting of a Highways Engineer, will upon completion of the civilworks, be absorbed into the Kawempe Division highway maintenance unit ofKCC and be responsible for all highway and drainage maintenance activitiesin the area. Additional staff may be seconded by NWSC to assist in thesupervision of the water distribution system, which will be taken over andmaintained by NWSC upon expiry of the contractor's maintenance period.

20. Plot consolidation and the organization of beneficiaries duringhouse construction will be assisted by the Housing and CommunityDevelopment Advisor. Community participation and the deve'lopment of micro-enterprises will be encouraged. To that end, the project will also assistthe groups in greatest need with building materials and equipment/machinesfor making building materials (bricks, blocks, tiles, etc). Co-operativeenterprises will be encouraged among beneficiaries. Beneficiaries willalso have the opportunity of leasing garden plots in the designated valleyreserve between the site and Hoima Road (to the West) as well as thenorthern swampy fringes. This should complement income and/or allow someconsumption of staple foods, essential in the current economiccircumstances, particularly for the lower income groups. The piped naturalsprings in the area, which provide employment to some 50 water-carriers,will be protected.

21. Community mobilization will be provided by the local resistancecommittees. RCs will oversee the running of water and refuse committeeswhich will be established at grass-roots level to coordinate the collectionand payment of fees charged for these services by the public authorities.The administration and collection of plot repayments from beneficiarieswill be the responsibility of the Treasurer's Department of MCC, which isalready being strengthened under the project.

22. The area adjoining the project site will benefit from off-siteinfrastructure built under the project. It is intended (not under theProject) to declare the whole of Kawaala area (including Mailo land) anaction area, prepare an area plan, and enforce the plan on would-bedevelopers. Land owned by XCC, but lying outside the project site, onsteeper sloping ground, will be sub-divided into larger plots, and leasedto higher-income groups at market rates. Premiums should generate asurplus over the cost of extending infrastructure networks to these, andother similar areas.

ANME]( SAppendix I

Pag 1 of 1KAAALA SMES AND SERVICES SCOME4

SERVICE STANDARDS FOR INFRASRUIURE

Service Stndrd

OFF-STE INFRAST CURE

Roads Kaa"la R,ads 80.0 a re/7.0 a GwHolos Roa: 40.0 a roeLoop-road: 20.0 a res/7.0 m cuAll wearing courses prim coat/cauble oel

Siorm Drains Earth llned drains except fheor slopeexceeds 1/20 where concrete linedCulvert, providw at road/paths crossingsOutfall as dictted by site conditions

Street lIehting Traffic route standards on 10.0 a polesat 80 a center (deoerred until rest ofcity Is up to standard)

ON-SIE INFRASTRUCURE

Roads Minor retdential:12/15 a ren/5.6 m ceAcess: 12/16 cw/4.5 a roeCul-de-Sac.: 12/1C m res/4.5 m owAll wearing course prime coat/double sewl

Car parking SOX off-plot car parkingExisting ground graded to falls, compaction

Footpaths 8.0 reu/1.5 C widebitumen sl wearing course

Stormater drains Earth lined drlas except where slopeexceeds 1/20 where concrete linedCulverts provided at rodJ/peths crossingsOutfall as dictated by site conditions

Water Capacity for 100X house connectionsStandpipoe at 85, wlking distancePer capita consumption 80 led connections

80 led standpipePeak demnd 0 2xaverageFire hydrante 800 centers

Sanitation Septic tanks for plots >4002Pit latrine for *Il other roe plots

Refuse Hardstandings provided t each car parkfor location of rfuse skipe

Street lghting Saeurity lighting standards on 6.0 o pole.at 80 ce ntre (deferred untO I rest of cityup to Standard)

Eletricity By U0; 88KV Itno to $MVA substation2 No. 11KV feeder IIn e to 5 No. tOOKVAtramtormer; 8 phase low voltage notworkto house (optional hook-up)

ANNEX 6Appendix 2Page I of 1

KAWAAL SITES ND SERVICES SCHEME

SUMMARY COST ESTIMATES

May 1990 base costs (sxcluding contingenie.s)

Local Forelgn Total

(US '000)

A. OFF-Sm WORKS

Road work* 160 479 689S.. drainnage 77 116 194Street tighting 21 119 140Water supply 1 5 7Electriclty 48 246 28Compensation 25 - 26

Sub-total Ott-site 829 965 1,292

B. ON-SITE WORKS

Plot demarcation 14 57 72Compensation 85 - 86Site preparation 4 12 15Roads & footpaths 144 482 676S.W. drainage 61 02 164Water supply 29 116 147Refuse disposal 12 16 81Electrical distribution s0 201 261Street A security lighting 20 116 187Pit latrine substructures 100 150 260

Sub-total On-site 471 1,196 1,687

C. COMMUNITY FACILIMTESPrimary school 185 815 460

Sub-total Community Facilities 185 815 450

D. MATERIALS A EqUIPMENTBuilding materials - 80O 8gOBlock-making equipment - 60 s0

Sub-total Materials and Equipment - 850 850

E. TECHNICAL ASSISTANCEEngineering design A supervision 40 86 897

Total 978 8,168 4,167

tM 5Appendix 3Page 1 of I

KW STES ms SERVICES SCHEME

PLOT AFORDOAUITY

(Al f igure. In US dol laor)

TYPE A TYPE 1 TYPE CPLOT PLOT PLOT

PLOT CHARE'i

Sale, .rlce of plot 1/ 1,241 2,710 S,7Stamp duty 6x a2 186 1S

Sub-Tol 1,80 2,840 8,911Ls 10 deposit 118 259 8

Balan from loan 1,115 2,687 8,566

lonthly loan Repayment(15 Ye0r, 0 206 mnt.) 20.78 8620 49.76

SERVICE CHORES

Rat" 2.00 5.00 10.00Water charge 2.60 6.50 9.00Ground rent 1 90 2.00 4.00Bad debt rserve 1.00 2.00 4.00

Total monthly service charge 6.60 14.50 27.00

Total konthly Outgo1ng 27.88 50.70 76.76

Minimum Required Household Incom(easuming 80X ot ncomoe to shelter) 01 169 2t6

Notess 1/ Including pit latrine substructure2/ Type S and C plots would be sold outright. These monthly

loan repayment figures are for comparative purposes only

AM 5Appendi 4

Page I of 1

KAVAALA SITES AND SnVICUS sCUDME

Beneficiary Selection Criteria

1. To qualify for the allocation of Type A plot beneficiaries mustmeet the following basic conditionst

(a) Must be over 21 years of age

(b) Demonstrate a minimum 2 years' residencein the Kampala area. 1/

5C) Should not own any other plot of landin the Kampala area. 1/ 21

5d) Must be Uganda citizens

(e) Have a demonstrated maximum income ofUshs 100,000 per month.

2. Every effort will be made to accommodate current bona fideleaseholders and residents in the project area withisn the planned layout.However, some resident's properties and houses may be affected by necessaryinfrastruct-re casements, right-of-way or community facilities.

3. Priority in the selection process will be give to currentleaseholdersiresidents in the project area whose houses will be affected bycivil works construction. Next order of priority wiLl be given to long-time residents of the area, who may not have a valid lease.

4. Beneficiaries of the remaining plots will be randomly andpublicly selected from the pool of applicants who meet all the basicselection criteria outlined above after current residents have beenaccomodated.

5. KCC will seek the prior approval of IDA for the finalbeneficiary application forms, screening and selection modalities.

1l The above two conditions to be verified with the assistance of XCIChairman, or equivalent, from applicant's current place of residence.

2/ Heads of households who already have a plot in the Xawaala projectarea will be eligible to apply for substitute land, even if they haveplot(s) elsewhere in Kampala.

AMN3Z 6Page I of 4

UGANDA

FIRST URBAN PROJECT

Rehabilitation of Rating System In Kampala

A. Backaround

1. The rating system, a property tax with the revenue accruing to thelocal government, is long established in Uganda. It is now based on therental value of real property with the owner being liable for payment. Theessential facts relating to the rating system in the KCC area at present areas follows:

(a) In FY1988 income from rates amounted to U Sh 7.5 million out of atotal from all locally generated sources of about U Sh 351 millionor about 2S of the total income, very much less than graduated tax(55?), market rents and dues (272) and licenses (72). The ratingsystem now collects an average of U Sh 10 per head, compared toGraduated Tax which collects U Sh 362 per head;

(b) In July 1989 there had be'n no revaluation since 1982 whenvaluatior. lists for 12 of the 15 districts of Kampala wereproduced containing about 27,500 entries. No supplementaryvaluation lists have been prepared since 1982. It is likely thatmany existing properties are missing from the valuation lists. Inaddition, the assessed property values are well out of date nowdue to inflation, in some cases by a factor of more than 30;

(c) A rate of 15S is set. This is less than the legal maximum of 202.Based on the estimate of the total rateable value in the 1982lists being about U Sh 1,000 million, the theoretical amountcollectable is U Sh 150 million. The amount collected is thusonly 5?. The full costs of valuation and collection almcstcertainly exceed the yield. The rating system, therefore, makesno net contribution to revenues; and

(d) Payments to ICC in lieu rates by Gov'4rnaent bodies are woefully inarrears, further straining the capacity of the City to providebadly needed public services.

2. There are a number of causes for the deteriorating performancewhich reached its lowest point in 1988s

(a) Owing to the lack of qualified staff, difficulties in trainingvaluation assistants, lack of equipment and the securitysituation, there has been a failure to revalue properties since1982 when valuation lists for 12 of the 15 districts were

ANNX 6Page 2 of 4

produced. Since then hyperinflation has rendered the figuresmeaningless. Notwithetanding, a new revaluation of the centralbusiness district and for Mbuya has recently been completed and isin the process of being used as the basis for future property taxassessments.

(b) It is estimated that more than half the properties may beexcluded from the valuation lists. (Although excluded propertiesmay commonly be the smaller ones and represent a small proportionof the total rateable value); and

(c) The collection performance has been poor (possibly only 5Z) owingto many very small sums being due and the absence of properaccounting methods or controls, resulting in the failure to issuerate demands to the majority of rate payers.

3. The fundamental issues giving rise to the low level of performanceof the system have been traced to the following weaknesses, for which theProject proposes countermeasures, the lack of accountancy training and thegradual deterioration of the accounting and controls systems: the shortage oftrained valuation assistants; the absence of training facilities for valueres;the lack of transport facilities and much essential office equipment; theabsence of computer facilities; the apparent lack of accountability to seniormanagement of the staff in the rating section; and the division ofresponsibility for valuation and assessment three ways between Ministry ofLands and Survey, Hinistry of Local Government and KCC.

4. Since 1988 [CC and the Government Valuer have achieved somecommuendable improvements notwithstanding the continuing shortages of trainedmanpower and equipment. The district of Mbuya has been revalued by the RCCvaluers. The Central Business District has been revalued by the GovernmentValuer. [CC has initiated a scheme of provisional rating designed to traceall rateable properties, with the help of the RCs, and charge set amounts onmost properties incorrectly excluded from the valuation lists. The scheme waspassed by Council in May 1990. These improvements are to come on streambefore September 1990 and demonstrate that [CC has the ability to organizeresources and the political will to do so. Pa-allel improvements in thecollection performance are being implemented and as a result [CC hasundertaken, as a condition of negotiations, to collect rates of Ush 115m in1989190.

B. Obiectives

5. The aim of the property tax rehabilitation component of theProject is to improve the performance of the rating system for [CC by methodswhich are both replicable and sustainable so that it becomes the largestsource of revenue within three years of the start of the project, yielding 100times the present total or not less than Ush 1,500 millionl- at the equivalentof 1989 levels, thereby trebling the income available to KCC. More

ANEX 6Page 3 of 4

specifically the objectives of the program ares

(a) To introduce measures vhich will allow Kampala's valuation andrating system to remain buoyant with respect to price inflation ofreal property;

(b) To increase rate collection efficiency; and

(c) To improve the quality of management information about rates toenable KCC and all ratepayers to be properly informed about thestatus of rate accounts;

C. Detailed DescriDtiom

6. Achieving the objectives will include the following activitiest

(a) The establishment of the KCC District Valuation office with thedelegated responsibility for the preparation of the new valuationlists for Kampala;

(b) The introduction of a mechanism to cope with different levels ofvalue in valuation lists for different zones in the city;

(c) The intensive local training of a cadre of valuation assistantsthrough innovative programs (including on-the -job training anddistance teaching) developed through the LGRC; and the provisionof short-term study tours for distance learning candidates andexisting qualified staff;

(d) The identification and surveying of all those properties atpresent incorrectly excluded from the valuation lists, using thereturn forms gathered for provisional rating, and the inclusion ofthe high value property in supplementary valuation lists; as aninterim measure, after the change in the law in (b) above, to usethe 1982 valuation lists to collect a higher level of rates from agreater number of properties;

(e) The revaluation of all rateable properties in the KCC area within24 months of the start of the project;

(f) The acquisition of necessary equipment, including vehicles, surveyequipment, and computers and proper training in its operation andmaintenance; and

(g) In conjunction with the training element for revenue accounting,to train KCC staff in improved methods of billing and collectionof rates.

AmE= 6Page 4 of 4

7. Technical assistance and training, to be supplied through thetwinning arrangement described in Annex 7, will include two experiencedvaluers for up to 60 person months. One valuer will be attached to KCC as theDeputy District Valuation Officer while the other will be involved in trainingin conjunction with the Local Government Resource Center at TPA.

D. Costs and Financina

8. The costs of technical assistance, shown in Annex 7, is estimatedto be US$0.9 million. The cost of training, both locally and abroad, has beenincluded in the overall training budget shown in Annex 7. In addition,vehicles, equipment and training aids will be required as detailed below.

Cost Estimate

Local Foreign Total1. Vehicles (US$ '000)

4 cars 0$12,000 48 482 minibuses 0$ 18,000 36 3610 H/Cycles 0 $80 8 810 Bicycles e $100 1 1

2. Office and Surveying equipment 10 103. Computerization if applicable 80 80

TOTALS nil 183 183

S. Implementation

9. Revaluation of Kampala will be undertaken by the DistrictValuation Office accommodated in KCC under the policy direction of theMinistry of Lands and Survey, the valuation authority in Uganda.Strengthening of the KCC's rating function, including billing and collections,will be undertaken under the direction of the City Treasurer. Both valuationand rating activities will benefit from training activities to be provided bythe technical assistance team working in collaboration with the LGRC at IPA.

AM= 7Page 1 of 8

UGANDA

FIRST URBAN PROJECT

Institutional Development of Local Government Bodies

A. Background and Program Formulation

1. The First Urban Project for Uganda incluces a wide range oftechnical assistance and training inputs to serve individual components anddifferent operating agencies. These individual inputs are packaged in sucha way that they are complementary and can achieve some economy of scale,while holding promise for sustainability beyond the life of the project.By integrating the technical assistance and training called for in thevarious components, there is the possibility of achieving a synergy wherethe total output exceeds the declared and anticipated achievements of theindividual components.

2. On the demand side of the TA and training equation are theKampala City Council, (RCC), the Ministry of Local Government (MLG) and theexpanding numbers of local authorities with decentralized roles andresponsibilities. The supply side, within the country, is represented by ahandful of institutions with minimal degrees of capacity, commitment anddemonstrated service. All have been caught up in the recent history ofUganda and, therefore, lack the basic resources to achieve the minimumgoals for which they were created.

3. Since other sections of the report detail the problems andopportunities associated with various programatic components of thisproject, and the operating agencies assigned to carry them out, thissection will be limited to a discussion of the general need for technicalassistance and training.

4. KCC does not currently have the quality or quantity ofadministrative, technical or professional staff required to carry outeither its short term commitments to the citizens of Kampala - or its longrange goals as defined by this project and others. Many established postsat the principal officer level or above remain vacant or are manned in anacting capacity. Compensation levels for MCC employees fall far short oftheir minimum needs forcing them to rely upon other jobs to *make endsmeet'. Rewards for exemplary performance are unheard of. The top cadre ofofficers, although stretched thin, is competent and committed.Unfortunately, they lack back-up personnel to support them in their day-to-day endeavors. Operational plans often remain only plans with no hope forfollow through. Beneath the thin veneer of administrative, professionaland technical (APT) personnel who keep KCC functioning, there is a deepchasm that only stops at the bottom of the organization. RCC is like a twocrusted pie with not much filling of substance. The TA and training effortmust necessarily address itself to building a middle cadre of APT officerswho can both fill the current void and build toward a sustainable level ofpublic service for the future.

AM=U 7Page 2 of 8

5. Training is, at this point, an aspiration, not a reality, withinKCC. There are no training officers, no training support staff, and notraining program. But, there is a commitment to training and a realisticpicture of training as a management strategy. The Town Clerk and other keyofficers know what training is required, how it should be designed anddelivered, and what it should achieve. This shared understanding aboutwhat training can and cannot achieve, and how that achievement can berealized, represents a sound and realistic base from which to build.

6. To summarize, the Project's TA and training components for KCCdo the following:

(a) they cut across functional components such as solid wastemanagement, urban markets, and street and drainagemaintenance;

(b) tliay address fundamental short-falls in financial andadministrative support systems; and

(c) they strive to build, through training and development, acompetent organization and work force that can be sustainedand further developed beyond the life of the project.

7. The second organization on the demand side of TA and trainingsupport in the Project is the Ministry of Local Goverr'ent. While the TAand training approach prescribed for XCC is holistic and pervasive, theinterventions into HLG will be more specific, focusing on its leadershiprole in providing financial management training and associated services toan expanding system of local governments throughout the country.Decentralization has swept Uganda with hurricane force. In its wake is anever increasing need to engage in institution building at theorganizational level of local government and to develop specificcompetencies at the individual level of interaction. Within the Project isa modest commitment and strategy to assist MLG in meeting these needs.

8. There is consensus that MLG must fulfill a leadership functionin training of local government officials. For example, MLG should beproviding leadership ins establishing overall human resource developmentpolicies for local government; assessing training needs and puttingpriorities on those that are most critical; setting standards; garneringresources; and monitoring and evaluating the overall effects of training,as it becomes a mainstream management and institution building strategywithin the local government process. To this end, the Project willsupport MLG's leadership role, providing technical assistance to establishan institutional base from which to develop a long term training program toserve local governments.

9. The third component on the demand side of TA and training arelocal governments in general - those local authorities beyond theboundaries of KCC. In addition to Kampala, which is classified as a CityCouncil, there are 34 districts, 13 municipalities, 23 self accounting towncouncils, four non-self accounting town councils; and 18 town boards. Thescope of MW's mandate to maintain a viable local government system is

AJNNU 7Page 3 of 8

expanding as more and more local authorities are created and given self-accounting status. The most recent development is to subdivide countiesinto self-government units. This would add another 700 or so localauthorities to MLG's mandate. While this project will initiate adecentralized strategy of training delivery, there is no expectation thatall local government training needs within Uganda will be catered forwithin the resources of the project. While a sizable number of localgovernment training events will occur under the sponsorship of thisproject, the intent is to t

(a) build MLG's capacity to manage local government trair.ing on anational basis; and

(b) develop a training delivery system that can ultimately meetlocal government's training needs in a decentralized manner.

10. The supply side of training, or the capacity to respond totraining needs, is largely non-existent within the operating agenciesthemselves (KCC, MLG, and its network of local authorities). Beyond thetraining capacity of operating agencies, which is at best minimal, there islittle to evoke enthusiasm. The Institute of Public Administration (IPA),formed in 1967 and under the jurisdiction of the Ministry of PublicService and Cabinet Affairs, has long had a program to serve localgovernments but its current efforts are paltry, given the needs. Thebright spot in their training current efforts is a linkup with GlasgowPolytechnic College to offer a 3-month course at IPA in auditing andaccounting. Nearly half of this year's class are local governmentofficials. The best students as determined by examination at the end ofthe IPA portion of the program go to Scotland for attachments with theStrathclyde Regional Council.

11. Beyond the Scottish connection, IPA's program is dated, largelyuninspiring and inefficient. While they still offer a nine-month diplomacourse in Local Government Administration, its enrollment has dropped to anuneconomical level (15 this year) and the quality of trainees hasdiminished (according to ML(; sources). The potential exists to turn IPAaround but it will require an infusion of resources, a redefinition ofm±ision and a program strategy that is contemporary, developmental andstreamlined to serve the decentralized needs of local government.

12. Beyond IPA is a smattering of training institutes and programswhich have the potential of helping KCC, MLG and local governments, ingeneral, meet their human resource development needs. They includes TheManagement Training and Advisory Center (HTAC) under the Ministry ofIndustrys various vocational schools; and the Hpigi Training Institute,currently under the aegis of MLC. Unfortunately, most are understaffed,under funded and underused. The challenge of TA and training under theProject is to meet the iuiediate needs of the various operating componentswithin the project witle building a sustainable institutional base andcapacity from which local government training needs can be met in the longrun.

ANMEX 7Page 4 of 8

B. Objectives

13. The TA and training component of the Project will accomplish twobroad, interrelated goals:

(a) support the short-term, more lmdetiate TA and trainingneeds of KCC and MLG in planning and implementing the otherprogram components of the project; and

(b) develop the institutional framework and capacity to meetfuture local government training and organizationdevelopment needs on a sustainable basis.

14. More specifically, the TA and training component will strive tos

(a) provide a linking arrangement between RCC and one or twosimilar local authorities capable of providing technicalassistance and training opportunities in the areas offinancial management, management of urban markets, solidwaste management. street and drain maintenance, housing,vehicle maintenance, property valuation and rating, andgeneral municipal management;

(b) establish and equip a training unit and capacity within XCCto manage training and to provide in-service, on the jobtraining opportunities on a continuing basis;

(c) identify and meet, to the extent possible within theresources of the project, specific individual and work unittraining needs which are important to the success ofproject implementation;

(d) train a cadre of training and organization developmentspecialists, from a number of operating and supportorganizations, who can be utilized full-time and part-timeto meet emergent local government training needs within thecountry;

(e) help establish and equip a training management unit withinMLG to provide overall leadership to local governmenttraining and institutional development;

(f) develop a series of local government training packages andoperational manuals to address specific needs within Ugandalocal governments;

(g) renovate and equip a small facility on the IPA campus toserve as a central resource development center to cater tothe training, research, consultancy and informational needsof Uganda's local governments;

Page 5 of 8

(h) conduct a minimum of lO,COO person days of training in thefirst two full years of operation; and

(i) provide transportation support to the training function andto a limited number of local authorities to assist them inrevenue mobilization.

C. Detailed Description of the Program

15. The program will have several distinct components.There would be linking arrangements between RCC and one or two localauthorities to provide direct on-line technical assistance as identifiedunder the various components of the project. It is expected the supplyingorganization(s) will provide individual technical advisors for varyinglengths of time (from two or three months to two years) in the followingoperational areas: market management: solid waste management; street anddrain maintenance; low income housing scheme development and management;financial management, huma-n resource development, and vehicle maintenance.(Other needs as they arise and are identified throughout the linkingcomponent would be considered within the resources of the program).

16. In addition to providing direct technical assistance through theplacement of specialists in RCC, the supplier would identify and facilitateattachments for MCC officers in their own organizations or like-mindedorganizations for varying periods of time. These would be based onspecific learning needs identified during the course of the project.

17. The formal training component for both KCC and MLG (on behalf ofall local authorities in Uganda) would be initiated by a 4-6 weeks trainingof trainers workshop with at least one follow-up workshop. This workshopwould be held in Uganda and include no more than 24 trainees, selected inteams from KCC, MLG, IPA, HTAC, regional representatives of smaller localauthorities, and at least one other training institution.

18. The program will focus on theory and skill development in suchareas as experiential learning, action research, process consultation andorganization interventions. A nearby local authority would be used duringthe course as a learning laboratory for identifying training needs anddesigning training events to meet them.

19. Three operational training units would be developed as soonafter the TOT as possible:

(a) one would be located in the Annex building at IPA and operate asthe central resource center for all local government training,working in close collaboration with MLG's training managementunit and XCC's in-service training unit.

This center would be seen as a physical extension to thetraining efforts of MLG and KCC and encourage their activeinvolvement in all activities. The staff of the resource centerwould include a local training coordinator; a full time

AM=E 7Page 6 of 8

expatriate adviser for 24 months (both skilled in the full rangeof contemporary training and organization developmentinterventions); a media and training design specialist andsupport staff.

(b) The second training unit would operate out of MLG and beresponsible for: training policy formulation, training needsidentification; setting training standards and priorities;garnering resources; and monitoring and evaluating localgovernment training. Because training, in its broadestinterpretation, encompasses a variety of organizationalinterventions, the Local Government Inspectors, working out ofMLG, would at times be involved in delivering training. MLGwould be equipped to carry out this leadership role usingexisting personnel located in the Local Government Inspectorate.They would also control a sizable budget to be used to fundtraining efforts for local authorities, nationwide.

(c) The third training unit to be mobilized under the Project wouldbe located in KCC, directly under the Deputy Town Clerk incharge of Administration (proposed but not yet approved byCentral Government). This unit would be staffed by MCC butsupplied by a full tine expatriate advisor in the initial monthsof operation. In addition, the project would provide forrenovation and furnishing of a training room and necessarysupport space; training aids and equipment and a trainingbudget to support training events and activities for the full.complement of KCC staff.

20. Once the training units are mobilized, they would engage in acomprehensive program of needs assessment, program planning anddevelopment, and implementation. Many training needs are already obvious,based upon discussions with a wide range of officials and officers in localoperating agencies. For example, financial management and generalmanagement skills (from the Town Clerk down to the first line supervisor)have been clearly identified as pressing needs.

21. Teams of trainers assembled from those who attended the TOT andkey persons from operating units, would be given tasks, resources and theresponsibility to develop training programs and operational manuals. Wherenecessary, these teams would be given expatriate assistance, either throughlinking arrangements with like-minded institutions or through directcontracting with individuals or organizations possessing the essentialknowledge, skills and experience. Top priority would be given to NLG'sneed to develop an accounting manual (code) for local authorities and aninspection handbook for local government inspectors. (Similar efforts havealready been undertaken in neighboring countries, such as Kenya, and neednot be developed from ground zero for Uganda).

22. The program implementation phase would be ongoing and includes

AM=U 7Page 7 of 8

(a) onsite long term advisors for varying periods of time(supplied, in large measure, through the linkagearrangements);

(b) relevant attachments, study tours and short courses abroadfor a few key officers (based on specific needs and theabsence of learning opportunities within Uganda or theimmediate region);

(c) in-house workshops, job coaching and on-the-job-training,particularly in KCC and the larger municipalities; a fullcalendar of training events scheduled in Kampala and eachregion to meet priority local government training needs;and an on-going process of managing these events, throughMLG, from needs identification to the evaluation of jobperformance, based on the training investment.

D. Program Costs and Financing

23. The total cost of the technical assistance and training programcomponent is estimated at US$4.3 million.

The TA and training component has eight main thrustss

(a) to provide long term technical advisors to KCC and MLG(through linking arrangements with other like-mindedorganizations). US$2.892 million.

(b) to provide funding for short term out-of-countryattachments to operating agencies, study tours andspecialized workshops, seminars and conferences (learningopportunities not available in Uganda) US$0.260 million.

(c) to provide support to establish a Local Government ResourceCenter on the IPA campus with capacity to serve lcalgovernment training needs nationally - (U5$0.375 million).

(d) to provide funding to equip a training unit and facilitywithin KCC (US$0.06 million).

(e) to provide funding to equip and support a local governmenttraining management unit within MLG (US$0.06 million).

(f) to train a cadre of trainers to serve KCCIMLG/and localgovernments (US$0.136 million).

(g) to provide funds to support in-country training programsfor local government officials and personnel (US$0.25million).

AM=3 7Page 8 of a

(h) to provide funding for vehicles to mobilize decentralizedtraining and to support on an experimental basis a limitednumber of local authorities in their revenue mobilizationefforts (US$ 0.214 million).

E. Implementation

24. )MLG and KCC would be the two *client" institutions under theinstitutional development (ID) component of the Project. With theexception of funds required to set up and run the LGRC at IPA, all fundsfor ID activities would be administered by KCC and MLG. Training servicesto be supplied to the project by LGRC IPA would be governed by contractsbetween the Center and the client bodies.

24. Consultant services will be supplied through a linking ortwinning arrangement to be entered into between i) RCC and another localauthority and ii) MLG and another training institution. Both arrangementsmay include the services of individual advisors or consultants as the needmay arise. The selection of linking lnsitutions (US$ million) will done inaccordance with Bank 'Guidelines for the Use of Consultants* of August1981. Civil works required for the renovation of facilities for RCC, MLGand IPA (US$0.23 million) will be procured through local competive bidding.Procurement of vehicles would (US$0.24 million) would be by ICB.Procurement of equipment and training aids would be by internationalshopping by means of obtaining at least three quotations from at suppliersin at least two eligible countries.

ANNEX 7Appendix IPop 1 ot f

FIRST URBAN PROJECT

Technlcal Asistonce A Training Cost Estimate

_ Local Foreign TotalA. Long-term Advisors (KCC) --- 41830000c-------

Sub-total A 1T 24' 2,1U2 2,486

S. Long-term advisors (ML4/I/A)Sub-tota I 72 48 410 468

C. Out-of-Country Attachmenta/Traini ng Courses/Study Tours

KCC staff 46 16 162 180ULG/IPA staff 20 8 72 s0

Sub-totol C 06 26 284 260

D. Establish Local Governmnt Resource Canter at IPARenovation of Annex 80 120 16DOffice/classroom turniture 10 60 70

raining/oftIce equipment C as 40Desktop publishing tacility 1 19 20Additlonal printing equlpont 2 48 sOTraining/printing materials/literature 0 26 25

Sub-total 0 46 807 856

E. Renovation of KCC/MLG training roomKCC facility/equip 10 60 60MLW facility/equip 10 SO 60

Sub-total E 20 100 120

F. Training ot Trainers programTrainers (2) 6 9 81 90Matorials 0 20 20Per diem for participante 48 24 0 24

Sub-total F 88 101 134

0. In-Country Training ProgramRoo/boara/materials 600 250 0 260

Sub-total a 260 0 260

H. Support Staff aIlowane.*KCC 20 0 20MA 20 0 20IPS 20 0 20

Sub-total H 60 0 60

r. VehiclesKCC:1 van 0 26 26LA: 1 van 0 25 25MLAs 2 4WD 0 40 40IPA:L 2 vans 0 SO s0IPA: 1 4W0 0 20 20LA revenue off icers:

60 motor cycles a 61200 0 60 60200 bicycles 0 *lO 0 20 20

Sub-total I 0 240 240

TVTAL 72? 8,684 4,811_ -

AM= 7

Page 1 of 2

Terms of Reference

Llaking arrmgemEnt between MLGIIPAJICCand External Organization with DemonstratedCompetencies In all Aspects of Training and

Institutional Development

MLG wishes to enter into a linking arrangement with an externalorganization specializing in training and institution development for thepurposes of helpings

(a) establish a training management unit within MLG;

(b) develop a training unit and in-service training programwithin KCC; and

(c) create a local government resource centre at IPA to provideall Uganda local governments with a full complement oftraining related services.

(d) design and conduct an initial training of trainers programfor participating agencies.

b4ectives The objective of this linking activity is to develop an in-country capacity to plan, manage and implement a wider range of contemporarytraining and training related services to support Uganda local governments.

Scope of Work:

The supplying training organization would provide the followingserv.-cess

(a) long term technical specialisticonsultants in training andorganization development for a period of time not to exceedthat listed after each specialist.

Mi) municipal managementIOD advisor for RCC (12mm).

(ii) training and institutional developmentspecialist for IPA (24 mm).

(b) make arrangements for and manage, a variety of out-of-country learning experiences including short-termattachments to training organizations or units specializedworkshops and seminars, and study %ours.

AMNEX 7ppendIx 2

Page 2 of 2

(c) advise MLG on the development of a training management unitwithin the Ministry to provide overall leadership to localgovernment capacity building throagh training and associatedservices.

(d) plan and conduct a training of trainers workshop, in-country, for approximately 24 trainees in two modulestotally 8 weeks of classroom and field work.

(s) work through the Office of the Town Clerk, to help establisha training unit and in-service, on-the-job program for =CC.

(f) provide advise and consultation on the development of a fullservice local government resource centre to be located atIPA.

Qualifications: The supplying training institution will demonstrate a depthand range of knowledge, skills and experience in such areas as localgovernment training, organization development, institution building, actionresearch, process consultation and Information and data management anddissemination.

Duration of Linking Arranaement: Although the longest period of time allotedto any one specialist under the linking arrangement is 24 months, it isexpected the relationship will extend over a longer period of time, givensatisfactory service and availability of resources.

ANNEX 7Appendix 3

Page 1 of 2

Terms of Reference

Linkina ArranRements Between KCC and One OrTwo External Local Authorities

The Kampala City Council wishes to enter into a linkingarrangement with one or two external local authorities for the puirpose ofimproving its overall management, financial and operational performance ona number of specified urban services. The linking services would includethe placement of highly qualified technical specialists in specific areasof KCC concern and the attachment of administrative, tecbnical andprofessional personnel from KCC who are in need of additional knowledge,skill development or direct on-line experience in program and service areasassociated with the First Urban Project.

In the event the linking local authority(s) cannot supply anysub-component of the technical assistance called for under the linkingarrangement, the supplier is expected to arrange for these servicesdirectly with a third party.

Objectives The objective of this 'inking activity is to improveKCC's overall performance to the standards of a successful local authority,both through the example of the supplier's own operation and through directtechnical assistance in developing operating systems and procedures,improving staff competeicies and assisting in the overall implementation ofvarious project components.

Scope of Work: The supplying local authority, either throughthe attachment of its own administrative, professional and technical staff,or through contracts with third parties, would p.ovide KCC with thefollowing services:

(a) long-term technical specialisticonsultants in the followingareas of expertise for a period not to exceed that is listedafter each specialist.

(i) personnel systems specialist (12 mm);

(ii) accounting development and training specialist (24mm);

(iii) revenue accounting development and trainingspecialist (12 mm);

(iv) valuation and rating specialist (2) (total of 60mm);

(v) vehicle/equipment maintenance specialist (12 mm));

(vi) market management specialist (12 mm);

ANIEX 7Appendix 3Page 2 of 2

(vii) solid waste specialist (12 mm);

(viii) roads maintenance specialist (12 mm);

(ix) housing specialist (12 mm).

(b) Arrange for and facilitate the attachment of KCC staffmembers either in the supplier organization or appropriate third partyinstitutions for short periods of time to enhance the participants'understanding, skills and experience in targeted areas of need.

Qualifications: The supplying local authority will demonstratenot only their unique qualifications in each of the above areas ofexpertise but state unequivocably that they are in a position to secondqualified staff, or to contract with third parties where necessary, for theperiods of time called for in the terms of reference (it is expected thatboth KCC and the supplier will utilize to the extent possible the documentsprepared by the World Bank to facilitate technical cooperation and trainingthrough linking (twinning) arrangements.

Duration of Linking Arrangement

The linking arrangement, initially, is expected to cover a 4-year period, with the expectation that some technical specialists will notprovide service for a continuous period of time but rather phase theiradvisory services over a longer period with diminishing involvement ascapacity is developed vithin MCC.

AlNE Page 1 of 13

UGANDA

FIRST URBAN PROJECT

Terms of Reference for Rey Technical Assiatance

1. Local Government Resource Center Coordinator(to be located at IPA)

The Ministry of Local Government intends to establish on thecampus of the Institute of Public Administration (IPA) a local governmentresource center. This center, to be operated through IPA, will create a newthrust in local government training and technical service, concentrating cndecentralized, short, focused training events, action research and processconsultancy interventions and the publication of training and operationalmaterials to be used by local officers on the job.

Obiectives The objective of this activity is to provide alternative sourcesof training and related services to local authorities and their personnel,based on identified needs and modern concepts and strategies of development.

Scope of Work: The local government resource center coordinator will beresponsible for the following tasks:

(a) to provide day-to-day management leadership to the center,including setting task objectives, planning the utilizationof center resources, coordinating the efforts of staff andadjunct resource persons and communicating on a frequentbasis with other components of the Urban 1 project.

(b) providing direct supervision to the subordinate staffassigned to the Center.

(c) preparing annual budgets and work pians.

(e) assisting in the establishment of an on-going program ofshort training events, problem centered consultancies andpublications to serve local governments throughout Uganda.

(f) oversee the utilization and maintenance of the physicalplant and equipment under the Center's direct control.

(g) carry out any other tasks or assignments necessary to assurethe successful initiation of an on-going program of trainingand associated services to Uganda local governments.

Qualifications: The center coordinator would be a local resident, holding apost graduate degree in an area of expertise associated with local governmentfinance or development and have several years experience in his or her fieldof expertise and the training of local government officials. The person

Page 2 of i3

holding this position should have demonstrated skills in interpersonalrelations, managing complex projects, and oral hand written communications,and a known commitment to improving the quality of local governments inUganda.

Duration of Assignment: The initial assignment would be for a 24 months.

2. Training and Institutional Development SpecialistLocal Government Resource Center - IPA

The Ministry of Local Government intends to establish on thecampus of the Institute of Public Administration (IPA) a local governmentresource center. This center, to be operated through IPA, will create a newthrust in local government training and technical service, concentrating ondecentralized, short, focused training events, action research and processconsultancy interventions and the publication of training and operationalmaterials to be used by local officers on the job.

Objective: The objective of this activity is to provide alternative sourcesof training and related services to local authorities and their personnel,based on identified needs and modern concepts and strategies of development.

Scope of Works The training and organization development specialistappointed to assist in carrying out this objective will undertake thefollowing tasks:

(a) provide overall technical assistance, guidance and supportto the training components of the project.

(b) assist IPA and ML6 establish a program of services for localgovernments that encompasses experiential training actionresearch, problem centered consultations and informationmanagement.

(e) work directly with MLG in setting up a training managementunit.

(f) help IPA and MLG establish part-time secretariats for theUganda Association of Urban Authorities and the localchapter of the African Association for Public Administrationand Management.

(g) assist in creating a network of training resources through-out Uganda in response to the managerial, financial,technical and vocational training needs of local governmentsand their employees.

(i) assist in the development of a publications program to servelocal government training and technical assistance needs,

ANMEU 8Page 3 of 13

including operational manuals, training modules, a periodicnewsletter highlighting local government developments andoccasional reports on major issues confronting localgovernments.

(k) work closely with IPA and other training institution staffand faculty to design and produce practical trainingresponses to clearly identified training needs.

(1) hold periodic short skill development sessions for areatraining officers on such topics as action research,organizational interventions and consulting practices.

Qualificationst The specialist should have a graduate degree in PublicAdministration, Human Resource Development or a related field; at least 10years of relevant experience in training and organization development, with asignificant portion of that experience in less developed country settings;and a commitment to contemporary approaches to human resource development.Must have demonstrated capacity to engage in team task accomplishment andpossess excellent interpersonal and communication skills.

Duration of Assignment: The assignment is for 24 months. The first 12 monthswould be spent in continuous service to the project with the remaining months,beyond that period, to be spent in intermittent consultancies based on theneeds of the project.

3. Municipal Managemut and OrganizationDevelopment Advisor to the Office of the

tom Clerk, Kampala City Council

The Kampala City Council (KCC) intends to improve the overallperformance of the organization by carrying out a series of organizationdiagnostic and development interventions from the Office of the Town Clerk, asfacilitated by an external specialist in municipal management systems andcrganization development strategies.

Obiectivess The ob3ective of this activity is to improve the overallperformance of the KCC with emphasis on improving service and programdelivery, maximizing fin&ncial, human and physical resources within theoverall control of MCC; and acting as a responsible and responsive agent ofthe local government process in Its inter actions with the citizens ofKampala.

Scope of Works The KCC would expect the Municipal Management andOrganization Development Specialist to carry out the following dutiess

(a) provide support and consultation to the Office of the TownClerk in a wide range of issues and concerns impacting onthe overall performance of the organization.

ANMEX 8Page 4 of .13

(b) assist the Town Clerk and other key officials plan and carryout a series of diagnostic investigations of managerial andoperational systems and practices within KCC;

(c) conduct strategic planning workshops, team buildingactivities, problem solving sessions and other experientialinterventions designed to strengthen specific components orworking units within the organizations.

(d) assist in the establishment of a training unit within KCCthrough consultations and program development activitieswith its members, such as conducting focused training needsassessments, helping design training interventions andcarrying out on-the-job training and coaching activities.

Ce) work with the technical advisors who have been brought intoKCC, under other components of this project, to help them bemore effective in their counterpart functions in terms oftransfer of knowledge and skills, interpersonal relations,and the overall maturation process required to facilitatethese kind of external inputs to the work setting.

Cf) help the Town Clerk and other key RCC senior officials carryout a strategic planning process for the organization andthe city - one which is dynamic and responsive to changingneeds and environment.

Cg) provide whatever assistance might be appropriate for theestablishment of the MLG Local Government Resource Centerunder this same project, particularly as it interfaces withKCC in helping to meet its training, research and consultingneeds.

(h) work closely with the personnel systems specialist (who willalso be assigned to the Town Clerk's office) to helpestablish a Human Resource Development Program for MCC toassure that any proposed system is compatible with thedevelopmental needs of the total organization and itsmission.

Qualifications: The specialist should have extensive experience in municipalarrangement, organization development and training systems and organizationsand a graduate degree in Public Administration, Management, Human ResourceDevelopment or a related discipline. Ideally, the individual would haveextensive experience in working with local governments in less developedcountries, or a demonstrated capacity to work in cross-cultural, complexorganizational settings. He or she must have indepth demonstrated knowledgeand skills in management, team work, organization development, strategicplanning, experiential training and action research type interventions as wellas effective oral and written communication skills.

ANNEX 8Page 5 of 13

Duration of the Assignment: The assignment is for a total of 12 months butwould be phased over a two or three year period, starting with an intensiveinitial intervention of up to 6 months. The staging of subsequentinterventions would be agree upon between the Town Clerk and the Specialist.

4. Personnel System Specialist to work with theOffice of the Town Clerk, Kampala City Council

The Kampala City Council intends to improve its personnel systemas a part of the Urban 1 project with funding from the World Bank. To carrythis task out, an expatriate local government personnel specialist will workwith the Office of the Town Clerk to provide professional assistance.

objectives The objective of this activity is to install a personnel system,with a human resource development bias, that can help KCC attract, retain,motivate, compensate and develop a mature, dedicated cadre of individuals toserve the needs of the organization and the citizens of the city.

Scope of Work: The specialist will be expected to provide the followingservices and/or undertake the following taskst

(a) provide overall professional guidance and assistance to theTown Clerk and his key officers in developing a personnelsystem that is compatible with the needs and resources ofKCC.

(b) review the present personnel system and assess its overallstrengths and weaknesses as an operating system designed tomanage and support the employment of individual officers andemployees by KCC.

(c) assist the personnel staff and individual operatingdepartments of KCC conduct a manpower study to determinepresent and future needs for each category of employees.

(d) help carry out a position classification and job descriptionfor each position and job function as currently establishedwithin the KCC personnel system, and develop new areas forthose positions or jobs which are not yet a part of theestablishment but are needed to aid KCC in fulfilling itsmission.

(e) assist, if appropriate within national policies andprocedures, a process by which compensation and perquisitesfor each position and job is equated against all others inthe organization as well as measured against outsidecompetition. The purpose of such an exercise would be toestablish internal equity of compensation and perquisites

Page 6 of 13

based on relative jobiposition requirem nts andresponsibilities and to assume a level of competitivenesswithin the local market place based on the financialresources of =CC.

(f) assist KCC staff in developing a human resource and careerdevelopment orientation and perspectives to personneladministration.

(g) assist the new Training Unit. (to be established throughthe support of the project) plan and carry out an ongoingprogram of on-the-job and in-service training based upon thecurrent and emergent needs of the organization.

(h) help establish a records systems that tracks each employee'semployment history and experience, including compensation,sick leave, annual leave and others. This system should bedeveloped so it can be automated at some future date,depending upon the capacity of =CC.

(i) review current performance appraisal procedures to determineif they are compatible with the needs of KCC and the abilityof various supervisors to utilize them effectively.

(j) help the training department design workshops and consultingsessions for supervisors and employees to explain changesthat have been made in the system.

Qualifications: Senior local government personnel specialist with anappropriate degree and specialized training and a minimum of 10 yearsexperience in managing a local government personnel system.

Ideally, the person would have less developed country experienceand a full knowledge and commitment to contemporary approaches to personnelsystems and human resource development. Must be able to work effectively as ateam member, have knowledge and skills in training and organizationdevelopment and effective oral and written communication skills.

Duration of Assignment: The assignment is for a total of 12 months but wouldbe phase over a two year period. It would be initiated by an intensive 5-6months assignment to carry out the necessary studies and research and todevelop basic components of the system. The staging of subsequentinterventions would be a matter of determining what is most beneficial to KCCin regularizing those systems that heve been devised and put into operation.

ANNEX 8Page 7 of 13

5. Municipal Financial Management Specialist

Obiective: To work with the City Treasurer of KCC to strengthen financialmanagement of the City Council.

Scope of work: The specialist will be expected to undertake the followingtasks:

1. Review the mechanized system of accounting procedures, makerecommendations as necessary and assist in implementing anyrevisions. Specific areas to be addressed are:

(a) Timetable of flow of information from source to dataprocessing.

(b) The documentation and control of the flow of data.

(c) The proof of data processed through control totals to primerecords.

id) The documentation and control of work undertaken by themachine room staff.

Ce) The production of a monthly trial balance.

Cf) The timely production of monthly ledger balances to enablethe comparison of actual income and expenditure to budgetforecasts.

2. To advise and train the key staff involved in the mechanicalsystem of accounting.

3. To improve the design of the forms and control books necessary forthe accurate processing of data.

4. To advise and train staff involved in reconciliation of the bankaccounts to the cash books.

S. Undertake a feasibility study on the computerization of theCouncil's accounting and financial information systems.

6. To prepare the year-end accounts of Kampala City Council inconjunction with the Principal Assistant City Treasurer(Accountancy).

Qualifications: Qualified professional account with CPA or equivalent with 10years experience, including at least five years experience working overseas.

Duration of Assignment: Two years.

ANNEX 8Page 8 of 13

6. Revenue Accounting Development and Training Officer

Obiective: To work with the City Treasurer of KCC to strengthen financialmanagement of the City Council.

Scope of work: The specialist will be expected to undertake the followingtasks:

1. Review the current system of debtor accounting and the revenuecollection procedures (i.e. Rates, Grounds Rents, Sundry Debtors,and Housing Rents), make recommendations as necessary fordevelopment and improvement, and assist in implementing anyrevisions. Specific areas to be addressed ares

(a) The detail and summary of receipts analysis to encompass thevarious categories of fees and charges levied by KampalaCity Council.

(b) The recording of debtor income and receipts via the controlaccounts in the financial ledger which is currentlymaintained on a NCR accounting machine.

(c) The procedures and methods for the raising and despatch ofaccounts.

(d) The assessment of Graduate Tax and the inspection ofEmployers accounts.

(e) The establishment of performance targets for cash and debtorincome and the monitoring of performance to targets.

(f) The procedures for the recovery of unpaid debts.

(g) The preparation of statistical data related to debits raisedand revenue collection.

2. Assist the Municipal Financial Management Specialist in thepreparation of a feasibility study to computerize the preparationof debtor accounts and the maintenance of debtor records.

3. To advise and train they key staff. involved in the revenueaccounting systems.

Qualifications: A suitably qualified accountant with 5 years experience inPublic Sector income systems.

Duration of Assignments One year.

ANNEX 8Page 9 of .13

7. Solid Waste Manageent Advisor

The Kampala City Council (MCC) intends to improve and extend therefuse collection services provided by the Public Cleansing Section in theCity Engineer's Department, as a 1..rt of the Uganda Infrastructure Project,and with funding from the World Bank. The Solid Waste Management component ofthe project will provide for stuaies, works and equipment necessary for anorderly implementation of the 1990191-1944195 Investment Plan, totallingapproximately US$ 5 million, as outlined in the World Bank Staff AppraisalReport (SAR).

objectives The objective of this activity is to improve the capability of thePublic Cleansing Section to plan, manage, operate and provide appropriate andaffordable refuse collection and disposal services to a large segment of thepopulation within Kampala, at acceptable service levels and environmentalstandards.

Scope of Vorks The KCC now wishes to appoint suitably qualified andexperienced Consultant to undertake the following duties:

(a) provide technical assistance, guidance and support to ICC duringthe first year of implementation of the proposed investmentprogram;

(b) Assist KCC in control, supervision, review and implementation ofthe following studies carried out on separate consultancycontracts for RCC:

Tender Documents and Contracts for the supply of collectionvehicles, containers and landfill operation equipment.Tender Documents and Contracts for upgrading three disposalsites.Tariff Structure Study.

(c) Assist KCC in preparation and supervision of rehabilitation of themunicipal Workshop, including specification of necessary tools andequipment;

(d) Assist RCC in preparing model contracts for contracting out repairand services of vehicles and equipment;

(e) Advice and assist KCC in improving and setting up a managementsystem, particularly with respect to repair and maintenance ofvehicles and equipment, in order to improve system performance andvehicle utilization; separate budgeting and accounting system forthe refuse services; simplified procurement procedures;information and recording system for planning, management,supervision and monitoring of the cleansing department operationsand services;

ANNE 8Page 10 of 13

(f) Assist KCC in setting up and managing a SWM performance andequipment utilization monitoring program;

tg) Identify the needs for formal and informal training of the PublicCleansing Section staff at all levels, prepare a training programin coordination with KCC, with special emphasis on in-house andon-the-job training, but not excluding participation in trainingcourses, seminars and workshops in Uganda and elsewhere. It issuggested that the training program is set up in cooperation witha local college or institute;

(h) The SWM Adviser in cooperation with the management of the PublicCleansing Section will provide the in-house and on-the-jobtraining; and

Mi) Conduct a national workshop on solid waste management practices,strategies and policies with special emphasize on experience andconditions in Uganda, coordinated with Cleansing Sections in themajor cities in Uganda.

Reportin:t The SWM adviser will prepare a report containing the proposedtraining program within three months of taking up the position. The reportshall be submitted to KCC for review and approval.

Quarterly progress reports containing system performance and equipmentutilization monitoring data.

A final report containing the SWM adviser's assessment and evaluation of thetraining activities, with recommendations for further training needs.

Qualifications: Senior SWM expert with a degree in Sanitary or CivilEngineer, with at least 10 years of practical experience from planning andmanagement of municipal refuse collection and disposal services, preferablywith experience from less developed countries, and with training and teachingexperience. Must have demonstrated capability in team work, personnelsupervision and management. Capability in oral and written presentations inenglish is a definite requirement.

Duration of AssiRnment: The assignment is for a 12 months period, possiblyextendable with 6 months.

ANNEX 8Page 11 of 13

8. Solid Wast. eangementConsultancy Service for Preparation of Tariff Structure Study,Willingness to Pay Survey and Public Awareness Campaign.

The Kampala City Council (KCC) intends to improve and extend therefuse collection services provided by the Public Cleansing Section in theCity Engineer's Department, as a part of the Uganda Infrastructure Project.and with funding from the World Bank. The Solid Waste Management component ofthe project will provide for studies, works and equipment necessary for anorderly implementation of the 1990/91-1994195 Investment Plan, totallingapproximately US$ 5 million, as outlined in the World Bank Staff AppraisalReport (SAR).

Objectives: The objectives of this activity ares

- to develop a cost recovery scheme for collection and disposal of refuseservices in Kampala, which will increase the financial self-sufficiencyof the Public Cleansing Section;

- to establish realistic and affordable rates for the various v,.'es ofwaste generators and for different residential income areas based on awillingness to pay survey;

_ to prepare a public information and awareness campaign to sensiti73 thepublic of the proposed refuse collection services and associated servicefees, as well as the required community and public participation.

Scope of Work: In achieving these objectives the consultant will be required,but not necessarily be limited, to carry out the following tasks:

Task 1: Identify all costs associated with the provision of solid wastemanagement and services for RCC and establish tariff levels on the basis ofmarginal costs.

Task 2: Investigate the application of alternative tariff structuresincluding different tariffs for different waste producers and residentialincome groups.

Task 3s Analyses the socio-economic environment and carry out a limitedwillingness to pay survey to determine the affordability of services ofdifferent waste producer groups and residential income groups.

Task 4: Establish the current levels of Government subsidies to the sector;

Task 5: Develop and recommend practical tariff strategies including animplementation strategy;

Task 6s Formulate tariff collection procedures and enforcement by one of thefollowing methods:

ANNEX 8page 12 of 13

- linking charges to other mmnicipal services such as water orelectricity;

- linking charges to property taxes;- cross charging other municipal services such as sweeping and parks.,

Task 7: Investigate the possibilities of mobilizing the Resistance Conmitteesin promoting, motivating the communities to participate in the refusecollection system, in implementation of a tariff structure, and in collectionand enforcement of service fees.

Task 8 Investigate the various media that may be used for a publicawareness campaign, and in cooperation with MCC and the Resistance Committeesdesign an appropriate campaign to sensitize the public to the needs andrequirements of the proposed refuse collection services.

Qualifications: The Consultant should have a degree in economics or businessadministration, and at least 10 years of experience from the public utilitysector. with special emphasize on financial analyses and tariff structuredesign. Demonstrated experience form other less developed countries will berequired.

Timin : The project will require elapsed time of approximately two months.

ANNEX 8Page 13 of j

9. Propertv valuation SDeciallts

Objectives* The IDA funded First Urban Project for Uganda includes a rating and valuationcomponent designed to increase locally generated revenue for Kampala City Council andother Local Governments. Technical assistance is to be provided from two valuers who willeither be recruited directly on the international market or through a twinning arrangementwith a suitable public sector organization or as part of a package from a contractingfirm.

Scope of Work: The specialists will be expected to undertake the following taskst

To set up a new District Valuation office for XCC;

2. To initiate improved training methods;

3. Identify all rateable properties;

4. Carry out a revaluation of KCC;

5. Undertake training of valuation assistants.

Qualifications

The following specialists are required:

a) District Valuation Officer for Kampala carrying out all the valuation workrequired for local and central government within that area; and

b) Training Officer to be In charge of valuation training

All candidates should be qualified as Chartered Surveyors or equivalent with someexperience in the public sector dealing with rating. Candidates for post 'a' willhave about 10 years' post qualification experience and proven management ability.

Candidates for post 'b' will have about 7 years' post qualification experience andan interest in education and training.

While experience abroad is not essential an ability to adapt will be important.

Term: A total of 60 person-months between the two specialists.

AMU 9Page I of S

UGANDA

FIRST URBAN PROJECT

Project Preparatory Activity

Small Towns Water and Sanitation Proiect

A. Background

1. The Water Development Department (WDD), which is part of the Ministryof Water and Mineral Development, is responsible for rural water supply andwater resources development, and for urban water supply in the towns not atpresent operated by NWSC. The 'Water Supply and Sanitation Sector DevelopmentStrategy and Action Plan' (March 1989) calls for VDD to promote communityinvolvement in village and small towns water supply including acceptance offinancial responsibilities. Financial constraints severely restrict 1DD inthe execution of its responsibilities. The Government is reviewing functionsand responsibilities in order to make WDD more effective, and to make sectoroperations more financially self-sustainable.

2. The sector organization will have to be adopted to the evolvingdemands with particular emphasis on:

- integrated approach in water supply, sanitation, and healtheducation;

- promotion of community participation and low-cost technologies;

- introduction of financial self-sustainability; and

- adoption of demand driven investment planning.

The aim is to structure the sector organization for maximum involvement of theusers and of other agencies in the operation and maintenance of schemes and togradually transfer WDD into a controlling, managing, consultative and serviceorganization.

3. In order to prepare WDD and the sector to manage further larger scaleinvestments in the rural areas and small towns and to plan for and facilitatea restructuring process as mentioned above, it is essential that WDD besupported at central level. The aim of the support is to render technicalassistance in the present day-to-day operations of WDD in the form of: (a)advisory support and manpower strengthening within key functions, (b)provision of Immediately needed office equipment/facilities andtransportation, and (c) consultancy studies to facilitate investment planningand sector reorganization according to the recommendations. It is expectedthat various donors -- notably DANIDA and the World Bank -- will assist insecuring funds for this technical assistance program. In a recently drafted

ANE 9Page 2 of 5

organization study for WDD a total of four urgently required technicalassistance personnel were identified together with a series of consultancyassignments.

4. The communities for which WDD has responsibility can be categorizedas follows:

- scattered rural settlements and villages (less than approx. 500population);

- rural growth centers (up to approx. 5,000 population); and

- smaller towns/urban centers (greater than 5,000 population - exceptthe seven major city/municipalities).

During the 19809 WDD embarked upon a number of implementation programs (whichrecently have accelerated in size and pace), covering in particular the firsttwo population categories, whereas the last category lately has been subjectto rather sporadic and small-scale investment efforts, although there is astrong need for further activities. It is within this context that the Bank isassisting GOU with the preparation of a project for FY93 directed towardsrehabilitation/expansion and new construction of water supply and sanitationfacilities in small towns and improvements in their operation.

5. Presently there are 59 urban authorities -- including the seven majortowns -- under local government statutory jurisdiction, which means that atotal of 52 small towns/urban centers fall under WDD's water sectorresponsibility. The 52 centers combine a population of approximately 800,000expected to increase to some 1.0 million in year 2000. Of these centers, 13have existing water supply and sewage disposal systems, 10 water supplysystems only, and 29 centers are awaiting facilities. It should be stressedthat the existing systems are in an extremely poor state of repair with acoverage as low as 102-20? of the affected urban population. In the past fewyears, through financial assistance by AfDB, RfW and France, a total of some10 of these towns' water schemes have been subject to or have plans for someform of rehabilitation and/or expansion. The proposed credit for a "SmallTowns Water and Sanitation Project" is intended to cover the water supply andsanitation needs of about 30 small towns and about 20 rural growth centers,technical assistance to WDD, studies on institutional and financial issues,training, etc.

B. Objectives

3. The First Urban Project would provide funds for activies inpreparation of the Small Towns Water and Sanitation Project, including supportto the technical assistance program for WDD as outlined in para. 3 above.This component is intended as a continuation of activities to be fundedthrough a proposed Project Preparation Facility (PPF) for the Small TownsWater and Sanitation Project.

AM= 9Page 3 of 5

C. Description

7. ?- The project preparatory activities to be financed under the FirstUrban Project would include the following:

(a) Technical Assistance to WDD

A Technical Adviser for water supply and sanitation would be assignedto the Chief of the Design, Planning and Documentation Division ofWDD, who would be his counterpart. He should be experienced with:planning, design, and implementation of water and sanitationtechnologies -- also low-cost options: community involvement in costrecovery, operation and maiutenance; and sound procedures for theprocurement of civil works and equipment, and for the engagement ofconsultants. His main responsibility will be to assist and adviseWDD on the preparation and implementation of the Small Towns Waterand Sanitation Project, including preparation and evaluation ofbidding documents and consulting contracts, supervision ofconsultants, liaison with the Bank, preparation and submission ofdisbursement claims, etc.

(b) Consultancy SerN_:49 for the following tasks:

(i) Preparation for the implementation of the Small Towns Water andSanitation Projects (i) breaking down the civil works into sub-components (that is, sets of small towns and rural growthcenters) according to financing source and timing ofImplementation, and selection of high priority sub-componentsfor implementation in the first phase of the Project, (ii)detailed engineering designs, tender documents, and tenderevaluation, (iii) preparation of terms of reference, draftcontracts, and tender evaluation of proposals for projectcomponents other than civil works, and (iv) assistance to WDD inmeeting the conditions of effectiveness of the Small Towns Waterand Sanitation Project.

(ii) Detailed recommendations for organizational restructuring of WDDand for insitutional and financial arrangements for operationand maintenance of the water and sanitation facilities to beconstructred under the Small Towns Water and Sanitation Project.These recommendations should be based on the proposals containedin the report *Organization and Management Study of WDD'(October 1989) as modified and expanded by the results of thewillingness-to-pay and financial self-sustainability studieswhich will be carried out as part of the PPF for the Small TownsWater and Sanitation Project. The study would outline theorganizational structures in detail, admikistrative and

£3131 9Page 4 of 5

accounting procedures, time schedule for staff requirements, andtraining needs.

D. Cost estimate

8. The estimated base cost for the preparatory activities outlined inpara. 7 is US$850,000, as detailed in the following table. It would be whollyfinanced by IDA. Out of this amount, US$120,000 in foreign exchange isincluded in an ongoing PPF for the First Urban Project.

-------------------------------------------------------------- __-------------_

(US$ '000)Local Foreign Total

(a) Technical Assistance

- Technical Adviser for 18 MM(salary, benefits, accommodationand travel) 20 250 270

(b) Consulting Services

- Staffing, accommodation andsubsistence for preparation ofengineering designs and tenderdocuments for an initial groupof towns 45 340 385

- Staffing, accommodation andsubsistence for sector structureand reorganization study of VDD 15 75 90

- Two vehicles and running costs 15 45 60

- Office equipment (PC, typewriter,copy machine, etc.) - 20 20

- Allowances to local staff 25 - 25_________________________

Subtotal for Consulting Services 100 480 580

TOTAL (base cost) 120 730 850

AMX 9Page 5 of S

B. Implementation

9. The component described in Para. 7 above would be implemented by VDD.PCU would advise VDD on project implementation procedures, particularly withthe preparaiton of agreements, the hiring of consultants, and procurement inaccordance with Bank guidelines. VDD would provide office space, to berefurbished under a proposed PPF for the Small Towns Water and SanitationProject, and the required local support staff to the adviser and theconsultants.

10. The post of the Adviser, under the PPF for the First Urban Project,would be funded for about 18 months out of which about five months havealready been used for a temporary employment of a water engineer, which wouldhave ended on October 31, 1990. The funding for the remaining period of about13 months for a continuation (under a separate contract) would be an identicalpost provided under a proposed PPF for the Small Towns Water and SanitationProject. A vehicle would be provided for the official use by the Adviser,procured under the PPF of the Small Towns Water and Sanitation Project. Somebasic office equipment for the Adviser may be procured under the existing PPFof the First Urban Project.

11. The consultancy services would be performed by a qualified consultantselected in accordance with the Bank's guidelines. The c7nsultant is to workclosely with the local staff assigned to the Project Implementation Unit inVDD and with the Adviser.

ANX 10Pog 1 of 2

UGWA

FIRST URBAN PROJECT

Details of Procurement Methods 1/

Procurement Ite ICe LCB IS Otber 2/ Co-finance 4/ Total(US milaion)----

Civil WorksUrban markets 6.11 6.11

(4.60) (4.60)Sanitary landfill 0.64 0.64

(0.50) (0.60)Stre.t/drain rehb 7.17 7.17

Kaweln lend servi.inglschool 4.06 4.08(8.15) (8.15)

Workshop/depot robab 0.29 0.29(0.23) (0.28)

WAL offIce rohnb 0.88 0.83(O 26) (0.26)

KCC office rebab C 05 0.05(.04) (0.04)

Major Supply Contract0Street maintenance mterials 0.28 0.28

(0.26) (0.28)Keyelo building art als 0.8 0.U8

(0988) (0.36)

Vehicles, Equipmsnt, TooleUrban markets 0.22 0.22

(0.22) (0.22)Solid waste smnament .680 5.60

(6.60) (5.80)Streets/dralns rehab 0.51 0.51

(0.51) (0.11)Kawbnlr Ind servicing 0.06 0.06

(0.06) (0.06)KCC mnagement program 0.70 0.10 0.80

(0.70) (0.10) (0.60)Urban planning prorm 0.06 0.09 0.17

(0.06) (0.08) (0.15)MLO 0.48 0.04 0.47

(0.48) (0.04) (0.47)Consultant Services, TA, Training

KCC TA and training 8.66 3.56

Physical Planning (IDA-KCC) 0.93 0.98(0.98) (0.98)

Physical Planning (GTZ-PPD) 4/ 0.60 0.60

MLO TA and training 1.10 1.10

30D project preparation 0.98 0.93(0.98) (0.98)

PPF 1.60 1.50(1.60) (1 60)

Supervision of mrket rehabilitation 0.81 0.81(0.81) (0.81)

Kawels eupervision/surey 0.80 0.60(0.60) (0.60)

Englnesring of solid waste componet 0.18 0.18(0. 18) (0.16)

Prearation of K_pln mapping (WLA) S/ 1.38 1.88(1.83) (1.88)

Land compensation 8/ 0.08 0.08

25.60 0.67 0.99 5.67 5.26 88.60(21.60) (0.52) (0.9) (5.79) (28.70)

1/ Figurs In brackets are the respetiv amounts financed by IDA.2/ Direct purchae, biring of consultants, and lond comnsotion.3/ Land at Kamla for site* end srvicoe cem4/ Nordic Devlopment Fud and GTZ.5/ Coet of Ka_la mpping allocated to WIA.

UGANDA

FIRST URBAN PROJECT

Schedule of Major Contracts

Code No Deecription of Contract Volue Procurement Implo ReferUSe 000 Method Agency Annex

CIVIL WORKSCwo1 Rehabi I Itation of Urban Marktet 8,240 ICB/PreQ KCC 1Cu02 K(nale On-aite/Off-atte Intrastructure Service. 2,968 ICB/Preq KCC 6Cwos Periodic Street Maintenance 1961 2,200 iCe KCC aCW04 Periodic Street Mantenonane 1992 2,400 iCe KCC a

CWO6 Periodic Street Maintenance 1961 2,510 ICe KCC 3CIOS Kawalla Electricity Supply 6M6 ICe UEB 6CWoT Upgrade Sanitary Landfill Site. 640 rCe KCC 2CWos K awala Primary School 571 ICB KCC 5CW9 ML Offico RebabilItation (Ici IIPA Annex) U80 LCB MLA 7CeWo Rebabi I tati on of KCC Workahop/depote 290 LCB KCC 2/8

C001 Kaw"l BulIding Materials 381 LCB KCC sam02 Stret Matitenanc: Materia la 168 100 IS KCC 8aDm Street Maintenance Mateatolao 1992 95 IS KCC 8CD04 Street Maintenance Material. 1991 a6 IS KCC 8

VEHICLES, EwYIPMENT, TOOLSE101 Retu Coliection Vehicle 2,800 ICB KCC 2EQ02 Landf il equipmont 6SO SCB KCC 21Q08 Retuee contalnero 2,700 LCB KCC 2EQ04 KCC Vehicle. (mcl motorcycles, bicycle.) 700 lCB KCC 1/4/6/7EQOS KCC Road Maintenance Equipment J10 ICB KCC a

EC06 MA Vehiclee/Equlipmnt (mncl VA) 480 ICB MLA 7

NOTES:All value. Incluslve of contingecteAll contract In *xcess of *300,000 rquire prior IDA reiew.

0a

IoN

ANNEX ItPage 1 of I

UGANDA

FiRST talm PROECT

Estimated Disbureemnt Schedule

Cumulativedisburse X

IDA Amount Cumulativ X of -fY Poriod Ending Dloburse Disbursed loan AF2 Urban

amount Sector-(US l II Ilon)-- Profl l-

91 Jun ao, 1991 1/ 1.0 1.8 0 0

92 De 81, 191 0.9 2.7 9 6Jun 80, 1992 2.0 4.7 10 10

98 Qc 81, 1892 2.1 6.6 24 14Jun 80, 1998 2.7 9.5 88 22

04 Doc81, 198 8.2 12.7 44 84Jun 80, 1994 8.6 16.2 so 42

9C Doc81, 1994 8.5 19.7 69 s0Jun 80, 1995 8.0 22.7 79 62

96 Dec 81, 1995 2.8 25.0 87 74Jun aa, 1996 2.0 27.0 04 a6

07 Dec 81, 1996 0.7 27.7 97 92Jun 80, 1997 0.5 28.2 99 SO

go Dec 81, 1997 0.5 23.7 100 100

Loan closing date: June 80, 1990I/ Includes PPF rfinancing of US81.C millIon

POJECT ZNPLfTfATION $CHEU

1900 I 1191 1 1992 194 I ImriptieIozye Y1 O I YRS I YR4 Y3

KCC DWRASIWCTURE R SIUTATN I NUP~ai~Urban Markeft.

=161" a xxxxxx xxxxxxxxxxxx xx11 ~L . . I I IXXXXX

- NMlul XXMXXXXX XXXX

worksbop rbbilltion xxxxx J- 1a11l perao I I on- procrI a l eqpment xxxxxxx xx l '-pRood. eolblitoot I_S xxx xxx xxxxxxx Rol ft11bt I to Fxx - periodic mintenan xxx xxxxxxxxxxxxjXXXXXXXXXXXX XXXXXXXXX- procure eqipmet xxxxxxx E- routine meinto c a xx_ xxxxXXXXXXXXXXXXXX X XXXXXXXXXOfflee ,e bibI totion oE[ 9- KCC training room xx I oI- AU training rooe xxxU IPA rc e I 1 IKCC _ ts o xxxIx xxx x I I 1urban d_ 1;p.wnt planning xxxxxxxxxxxxixxxxxxxxxxxxKaw 4t le sits WAd so rlowI!- planing a denGl xxxxxx xxxxxxx I- Install n frastructure xxxxx xxxxxxxxxxxx xxxxxx- allocaet plote xxxxxx xxxxxxxxxxxxIxxxxxxxxxxx- oIt-help hoom coen t0 1 tln xxx xxxxxxxxxxxxlxxxxxxxxx- deelop oconenity facilities I * 1 xxxxxx xxxxx Ixx

-z Ir I Ministry of L.c.l Governm nt- linking arrangement xxxxxxxxxx xxxxxxxxxxxx xxxxxxxxxxxx xx-et up LOCR at VA xxxxxx II- trtin LG workers xxxxxxxxx xxxxxxxxxxxx xxxxxxxxxxxx->jK _ 1* City Counetl I

Ilnking arrangement 1 xxxxxxxxxx xxxxxxxxxxxx xxxxxxxxxxxxgxx I II- operti ml assistance I I xxx xxx xxx xxx xxx xxxx- operational training I xxx xxx xxx xxx xxx xxxx

I I I I IeI IoI s

Page 1 of 2

UGANDA

FIRST URBAN PROJECT

Prolect Supervision Plan

1. Bank Supervision Input into Key Activities. The staff inputindicated in the table below is in addition to regular supervision needs ofabout six staff weeks per year for the review of progress reports,procurement actions, correspondence, etc.

2. Borrower's Contribution to Supervision.

(a) Progress reports are to be submitted as followas

(i) at the end of march, June, September, and december of eachyear;

(ii) by the Project Co-ordination Unit (PCU) which willassemble contributions from MCC, NLG, IPA, and MOHUD asrequired;

(iii) with contents and format to be agreed with IDA.

(b) Project monitoring and co-ordination will be the responsibilityof PCU; review meetings with the participation of the variousproject agencies will be held normally in April and October ofeach year. The meetings will be chaired by PCU.

(c) PCU will be responsible for co-ordinating arrangements for Banksupervision missions and for providing information required bymissions;

(d) Mission briefings on arrival and wrap-up meetings prior todeparture will normally be chaired by the Project Co-ordinatorwith participation of the project agencies.

AM=13Page 2 of 2

Bank Supervision Input into Key Activities________________________________________________________________.__________

Approx Activity Skills StaffDates RequiredInput

5-6/91 Supervision mission TM, ME, PA 6.0(Project launch workshop)

6-7/91 Review twinning TM, ID 2.0agreements

8-9/91 Review KCC workshop plans, TM, HE 2.0SWM equip, material, toolbid docs

10/91 Supervision mission TM, ME 4.0(review annual KCCallocation, roadmaintenance plans)

1992 Supervision missions (2) TM, ID, ME, FA 6.0(review KCC, MLG, IPAprogress, incl KCC annualplan review)

1993 Supervision missions (2) TM, ID, ME, FA 12.0(review RCC, MLG, IPAprogress, incl KCC annualplan review

1993 Mid-tern review (covered by resources in 1993Supervision Missions)

1994 Supervision missions (2) TM, ID, ME, FA 8.0(review XCC, MLG, IPAprogress, incl RCC annualplan review)

1995 Supervision mission TM, ID, ME, FA 8.0(review ICC, MLG, IPAprogress, incl RCC annualplan review)

1996 Supervision mission TM, ME, ID, PA 8.0(review KCC, MLG, IPAprogress, incl XCC annualplan review)

1997 Supervision missions (2) TM, ID, ME, FA 8.0(including one to preparePCR)

…-- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

- -muss sinin~ ~ ~~~ is. uswui41N CM C IM 4.1 Cl 4W 411

':: -a t; 1SUM 1 u 14 13U

a a in m m JU in~U 1 59 on

4 in

JIM! _ 1 351 U 2.1 tg j Is? Ot t. 4.15 6 1 . us 2 .1 4,w s.e 4.36 4.M 4.313

I 0115 13 3 In A11 1311111? a* I 31 1 ,4I5 2 3 134 .1113 1.111 1.1 1.511 I SSI SIN 5.11I 5.541

_§§sups tnn es

llIN l51=- I U6 fill (m l fix ON) t. U. . n la 5 S.I S,S S SX inS 5.5 a

bi 0 I I I 0 0 3 0 M IN tu to 14 a F

IOI 6 m n 2It 11 1 2(2l 2.411 ( ,it 2.1t4 2It. 3 1. 1 3.31 5.3 3S, 3.3I 1

, P I fS1 tS Ul I2 1 n (51 3 I 2.15 2.42 2.56 2.- 2.411 t.US 2.41S t.41 1.455;

mmmiml 0 II6M11 43 13 12 11 I n i nj 1 0% 1 5 1

lZm o z) tS 121 1 (111) 23 1, 1 I.m 1.41 1.5l. 1,4a .S ,I . 413M

_ WAN .11 M 121 M lull 461 (gm) (361.2 24 low 1 S6 I 1 43 S 51 (tJSIuIWE 0 * * * 6 * * * * 54 u 1 13 it in IU A2

WI 15 (1*1 (243) 443) (3 1) 53 1,221 242 43 31 * us Is' 1223)t

UU I (6II) It3 f134 1146lU1") 3631.21 242mtUS t }_ mISII eU 6 t 01 *" 9 W *" * e, *, I, *S ,F t.t

1:'::::: , : : : :

5Y3 a ism 3 224 313 3 25 3,266 3.313 4,141 5.539l 6.186 6.354 9.116 II11641 24.61

n sm

SI~~~~~~~~~61 t4 IIS 11# I1 93.t 1 t.tl .1 4.§tS 6.36 *. *ti2"S

ElIHut S,fl 6,444 6.154 ~~~~~ ~~"~' 8.568 (I1:13 I:,j Tc: Tjf 13.2 4414? 36 '4:1 'i;:m

10 IX8113am18 36,412 36.56 361843 ,143 U.14 13.21S 15,813 18,358 2I43 21.4 IS 14,164 24,1131 25.431 .6

g 9 22 3 32 6 6 284 5 4 352 I ON

f34) 434) 34)l (34) lam) (34l (34 (m)34) I I ( 3) I434)

, ~~~~~~~~~~~~~~~...... .... . .......... . ...... ........... .... ....... .... ...... .... ................ ............................ ....10*1 6611811 ItU U U2 9 S3,113 (3,411) ( 3.2223 42.381 (2,622 (2,13 (1.58 (85 36 3.1 2.135 3.23 4.36 1.1

U no mm 13.412 14.2161 34.114 13,365 14,1116 15,8411 18.353 WM 22,332 1223116 22,266 21.823 21.46 21.18 13611

NOW} 42"} t 2 1.6 156 2.256.2,31 2.33t 2,314 431 43231 2 2 6i ,,W ... _,,, .... , . .... , ,. _.............................................- .............

& Sl"!" * O 1.5 t, 2-2~~~* 38 55 tu34 hi 431 t* 2.j3t 2.331 2,331 2,331t 2.33?

161* 1 NlN U6313 9 1*1 3,615 2.311 2.44 2.4 2,38 2,55t 2.455 3,35 2,253 1.2t8

Wm681 Am35 39,4 1 4,336 14,436 14,081 35,185 11,8.8 .21,5-4 26.13 289.69 3.541 31,115 32,11 33,611 341,43 31.83UUI - sW : .ss: ...... ,, ... , , .....................---- -----..----- ------ ----.. .....

''33S"*

I= a a-- -- - -2 ---28 6 - 5 I' - IN 18 I"' - 1 ItS (It 118

tW uim uu*iUnu 21 41 243 23 4 IU 3 I4 36 It6 II I ItS 11 m

s- -13341313

on 461331 II * * 1,66 4.IM 18,63 1.53 ,3 8,l$ 1.828 1t,43 T,23s 3.9?.... ........... . ..... ... .. ,,............... , , ,......,, ,.. .,....................._. ... _. . ..... ......

10Nu 18 1,W l 1S 21 41 241 21 1.64 1.116 4.512 1.643 3.151 $6.281 8.11 8.6 1.113 1,13 4.135,15 ... i. ....... .... .... .......... ................ .... .... ......................

Am m , - !Uti MINt .4- 4. : 4. 1 s!XT i.12 1.JU I. 01.0 M2t .518 U4.131 2. VA 2 12 5161

:::::::::::;:::

9 a a~~~1 1 3 ,1.2 2,33? 2.33 1 2."' 1 3 "'4 2.33? " " .1i

P," 1,412 3.8U,41 18.14} 36,31 21 33. t2 13.45? I j 12 lb 13.. 1i. s IL.jJ i J 3 , 22 8

(23) ,,*d 33,n 3 3 J,tUI 3! f ',3' 1tU : lI H 1:11 ,t 3t III Iif 1f IN ,tU3.71 3 .13 2,113 J.113 3.113 3.113 3,113 3.113 3.113 1.113 3,113 3.113 3.113 3.11,3

tOta I.U1 1434 mIN 14.4141 3.5,62 3U1,342 12.0 .2. 22,2N 23.,18 24.131 25.11 n,sn.61 1 5.6.~~~~::::::::s ::

~~~~o '= t"srnmu -, mt ,,. S II|t'l"'"" '"'i"5'n'if ''% Ism lab IJW d'if ISA no tm 1, 1.1.%v no

D " ' * * *......... . .. .............

138. U! iuuu ii&i lKENT) NN (1) 9 4 I (15) 23 1,111 1,13 1,11 1,35?1 I, 1.455 1.362 1,3 1.11

1 I's a I I I iw I2 I 17, 1, 1 111NUl IhU 46) IN 1 U1 1.M5 2.11 4,185 4,413 2.22 1.611 I.4 15 1.462 1.429 1.49

..... 19:..h

.SuI I IJ I 311 2,1 1.11 254 3 1mum m I 03 * m I'm1. t,#4 3,l .1 I'm # u 15 w M " to isM UI(/11) mm 61 ll a I 1115) 234 1,51 1, . 1.111 1.31W 1.455 1, 31 1.321 1,391

IRU/EUI) IIKEN 1111^ ...... : =... :-.- . ............ :-:::

g .. ... 1i I 0111) 2 l 3t I.,U 4 M 1,364 LU 1.455 1,362 1,22 1,313

|~~~~~~~~~~~~~1 IUI MIt (1 (III) (11) :gZzzz11) (11 t i I i 3 ws 41 3 N awwA iun a e 1M5 2 1.019 1,811 13N 1,351 1.311 I., 1t.2 1,321.311

O~~~~'

SA

AoEn 14Psge 4 of 6

Notes on Financial Prolections for RsmDala

A. Ineome and ExDpnditure statement

Income

1. The base estimate was calculated from the original XCC budget for thefinancial year 1989190, increased to take into account the currentestimated (higher) collection efficiency. The base is conservativelyestimated.

2. Each class of income was reviewed in detail together with its collectionefficiency on a year to year basis.

3. The 1989190 estimate of income was reduced to take into account the 5months delay in the approval and implementation of the new fees andcharges.

C. It has been assumed that improvements in the collection efficiency willreach a maximum in the financial year 1995/96. This will be due tot-

(a) improved administration (including the filling of vacant keyposts) and accountability through the provision of training andtechnical assistance; and

(b) the establishment of an accurate debtors database.

5. The markets improvements will stimulate trade, enabling the charging ofa further estimated Ush 93 million per year.

6. 751 of the onsite costs for the provision of serviced land in Kawalawill be recovered from the plot allotees.

7. The cost of implementation of the rating and valuation improvements willbe met by the resultant Increase in rovenues.

8. The consultant's revenue estimates for the waste disposal projectcomponent have been incorporated in the overall revenue projections.

9. The streets and drains component of the project is an unsuitablecandidate for direct cost recovery and therefore development andmaintenance costs will be recovered indirectly through rates and generalrevenues.

Espenditure

10. The recurrent expenditure projections are based on 1989190 RCC budgetestimates.

ANM= 14Page 5 of 6

11. The original esttmate has been revised for the financial year 1989190according to the projected shortfall in income created by the delay inapproving new changes and fees.

12. Employees costs have been projected throughout at the level of 1989190.

13. Other costs have been increased for each Department from financial year1991192 to 1995196 as shown.

a) TOWN CLERK - 52 annual increase on 1989/90 estimateb) CITY TREASURER - 52 annual increase on 1989/)0 estimatec) INTERNAL AUDIT - 152 annual increase on 1989/90 estimated) EDUCATION - 102 annual increase on 1989190 estimatee) PUBLIC HEALTH - 102 annual increase on 1989/90 estimatef) CITY ENGINEER - 102 annual increase on 1989/90 estimate

14. Capital expenditure from recurrent income is based ons

a) KCC's capital program (own resources)s estimated capitalinvestment for the eighth and subsequent years has beenassumed to be equal to the investment in year 7.

b) Project counterpart contributions by KCC to be 502 of thelocal component of the project costs, starting in thefinancial year 1994/95; and

c) Counterpart loan repayments cosmence In financial year1998199.

15. Depreciation is calculated at the following percentages of fixed assetcosts:

a) Land and Budldings - 3Xb) Vehicles, plant and

machinery - 152c) Furniture and equipment - 102

16. Interest on onlending from the Uganda Government has been assumed to be22 of loan outstanding. Interest on works in progress has been capitalisedfor the financial years 1994/95 to 1997/98.

17. Deferred ¢harges have been amortised over 25 years commencing withfinancial year 1998/99.

1. Debtors have boon lcresed by 101 of the annual ncreae is n operatigIncom.

2. Creditors have been Increased by 101 of the increase In operating costs.

3. Stock has been increased by 10 of the lncrease in creditors.

4. Pixed assets are tcreased by the project development costs and the XCCcapital program.

5. Deferred charges are the project costs of organisational strngthtenng,project preparation (PPF) end the interost which has been capitalised.They have been amortised over a 25 year poriod.

6. Loans oustanding are the liability for loans incurred in accordance viththe implementation schedule, including physical contingencies.

C. SOurces and AuDlicItica of Funds

1. Capital Reeidpts Is the estimated income from Land Preium.

ANKEII 15pop I 3

UOAI

FIRST UIMON PRJECT

RATE OF RETURN CALCULATION A S3EnSIIVTY ANALYSIS

KAWAALA SITES & SERVICES SCHEME(600)

Year Land Intra- Overhead Om Total Imputed Net Coss up Beeit.structure Costs Incremntl benefits lx don lOX

RentsNotes: 1 2 3 4 5

19S0 89 100 so 0 160 0 (18) (206) (189)1991 0 1,000 so 0 1,050 0 (1,O0 (1,155) (1,050)1992 0 e06 s0 0 746 0 (740) (621) (746)190 0 0 0 130 10 130 1171994 54 54 20 206 201 1601995 54 54 445 an ass 347196 64 64 445 sol a 3471997 54 u4 445 n a66 347198 54 u4 445 8ol S66 8471999 u4 u4 445 8n ass 3472000 u4 54 445 301 3se 347200 54 U4 445 301 36 3472002 54 U4 445 sn 3472003 54 u4 445 30 as8 8472004 54 4 445 3n 366 472006 64 54 445 301 366 3472006 U4 54 445 3n 3l 3472007 U4 54 445 301 36 34?2006 54 54 445 30 3se 3472009 54 54 445 301 8s6 347

Internal Rat ot Rturn a 13.51 12.01 11.05

1/ Land costs include compention2/ On-sit* Infrastructure Includes land survey, Water Supply, roads and dralns, an pit latrine bose

No portion of off-site lntrastrucure cost alloated to the project/ Overhead Includes KCC cost of administerlng Scheme

4 0& assumd to be 3 et capital ceostSnluds i tneremntal rent for *II roeo on 1,000 plots as they are constructed acerding to tollowingshoulez firs room In year 4, second rom in yer 5, third room in year 6.

Imputed lncrementl rent assumed to be UShe 4,00 pr month per rooLocal Cost shadowpriced at UShOOO

UNNEX 15

Pag 2 of 8

UGANDA

FIRST URBAN PROJECT

RATE OF RETURN CALCULATION ON REHASILITATIONOF URN MAMTS

(Owuno, Natet., and Bugolobi)

(In Thousands of Dollars)

Year Capital Incre Total lncre. Nmt Cosa tcEbef Its(FY) Cost O and N Inc.Cts Revenue Beneflt up 10X down 10X

1 1,200 0 1,200 800 (900) (1,020) (980)2 2,400 144 2,544 400 (2,144 2,38) (2,184)8 1,600 144 1,944 1,242 (702) (696) (826)4 144 144 1,242 1,090 1,084 9745 144 144 1,242 1,090 1,084 9746 144 144 1,242 1,098 1,084 0747 144 144 1,242 1,098 1,064 9749 144 144 1,242 1,098 1,084 974.0 144 144 1,242 1,090 1,084 97410 144 144 1,242 1,098 1,004 97411 144 144 1,242 1,096 1,084 97412 144 144 1,242 1,098 1,064 97418 144 144 1,242 1,098 1,084 97414 144 144 1,242 1,098 1,084 97416 144 144 1,242 1,090 1,084 9741s 144 144 1,242 1,098 1,084 97417 144 144 1,242 1,096 1,084 97416 144 144 1,242 1,006 1,084 97419 144 144 1,242 1,090 1,084 97420 144 144 1,242 1,096 1,084 97421 144 144 1,242 1,098 1,064 97422 144 144 1,242 1,098 1,084 97428 144 144 1,242 1,098 1,084 97424 144 144 1,242 1,098 1,084 97425 144 144 1,242 1,098 1,084 974

Internal Rat. of Return * 28.11 20.8X 20.01

1. Bas Coat 65.80 eilIIon + 10 percent physi al Conti nencyLocal Component shadow pried at 600 USh/US8

2. OAM assmed to be 8X of capital Costs8. Economic benetit assum to be the w of Incremental rental Income of three mrket

as estimated below, baW on survey of sub-letting carried out by KCC, August 1990.:

market # Stalls Inere Totalrent rent

(U S) (U Sh)pm pm

Obuno 4,000 10,000 40,000,000Bugolobt 260 4,000 1,000,000Nate" 202 2,000 404,000

Total monthly rent (U Sh) 41,404,000

Equivalent annual rnXtl (US$) 1,242,120

Peg.8 f J

UGMAN

FRST URDN RECT

ECOMC RATE Of RETUR CALOLAIION ONUN ROD 3A3

(tn Thousan of Dol ore)

Year Costa Coto Olfferntil N Coot ese its(Ft) Without With Cost. * 263 - 23

Projet Projet

1990 0 2,100 (2,10) 2,100 (2, 2,100Io1 0 2,100 (2,10 2,100 (2,62 2,1001262 0 2,100 (2,100 2,100 2.626 2,100196 0 0 0 01994 0 0 0 0126 0 0 0 01996 0 0 0 0126 0 0 0 01926 0 0 0 01w9o 0 0 0 02000 0 0 0 02001 200,000 (2O0,000) 200,000 (1l0,000)20021 0 0 0 02001 0 0 0 02004 200,000 (200,000) 200,000 200,000) 160,000

Ineornal Rau of RIturn = 8.4 29.73 26.QS

ESIMaTON OF OVEALL 5A FM PROJECT

Total Componetc0t R

market Upgrading 6,7 2821XRoad lsatenance 7I,498 88.4SKqw lt Lnd ServIcIng 6K230 18.63

Welghted vere 19,60 24.5Xon SIX of toal projeet

Pags 1 of 1

UGANDA

FIRST URDAN PROJECT

Related Documents and Data Available in Proiect file

1. Study for the Improvement of Kampala's Urban Markets (Final Report),John Van Nostrand Associates Ltd and Ka"a and Partners, March 1990.

2. Solid Waste Disposal - Kampala (Final Report), EnviroumentalResources Ltd, March 19904

3. Technical Feasibility Study for Serviced Residential Land in Kampala(Draft Final Report), LandPlan Group, October, 1989.

4. Kamala City Council - Arrears of Accounts (Final Meport), CIPFAServices Ltd., December 1989.

5. Iampala City Roads - Maintenance Activities and Cost Estimates (DraftReport), Kampala City Council, approx June 1989.

6. Strengthening the Physical Planning Department of MM (Draft), UNCUSProject Document, February 1989.

7. Rating and Valuation in Kgmpala (Revised Reort), Simon Keith,November 1989.

S. Assistance for the Rehabilitation of Topographic Surveying andtlaypins - Mission Report, UNDTCD, New York, January 1988.

9. Study of Housing Preferences and Potential Housing Demand of UrbanHouseholds in Kampala (Final Report), Incafez Consultants Ltd,September 1989.

UQ

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CIeu,.le

CHART 2Page 1 of 1

PROJECT COORDINATION UNIT (PCU)OBGABIZAZIM

Leading Ministry: I MPED I STEERING COMMITTE

Ministry of Planning & I Members of Steering Committe:Economic Development I (Represents all Ministries(MPED) I involved in the proJect)

I MPED (Chairman)I Ministry of Local GovernmentI Ministry of Water & MineralI DevelopmentI Ministry of Lands and SurveysI Ministry of Housing and UrbanI DevelopmentI Ministry of FinanceI City Council of KampalaI ProJect CoordinatorI (Secretary)

I

I PROJKCT COORDIN&TION UNIT II (PCU) I

Consisting of1 Coordin tor (Local)

II

I

1 Water Engineer (Local I 1 Urban Planner (local)1 Water Engineer (techn. I

assistance) 1 1 Municipal EngineerI (TchuLcaZ Assistance)

Accountant (local)

Support Staff: typists, drivers

1-:!} -

--- £~ I

-I]

-E§m}J - 4

J. -~~~~~~~~~~~~

IBRD 2247Ar - -- ' tn -- nb a4b

SUDAN . w 5d v

) t?HIO#IA - > UGANDA

CAR,z, , st -.- ~CITY OF KAMPALA*AAKENYA -

T rANZANiA

_ _ _ _ _ _ _ _ _ __. / ' q

Kawea?pe

\ Ko.wva S;rK / \ \ and Serices A '| Wand*

* --- 8'jM e\ KMA Q

1 X M \\ - NEno 4< bi No Wla

Ifr S Notut ~t ' Kbugu 0, f < / t 5tli ^ Lu2iro

\ \ KiEve/"\ V~~~~~K

Gob.

EX(ING To BE REHABIUTATED N. ;sUNDER THE PROJECT \

* 0 Urban Markets / \

* A Municipal Depots

0 Re"se ips? KoKwalo Servied Land

-- PiPmory Rocds

Secondory Roads \Mulungu I t- - Kampala City Council Limits

- - - International Boundoaries

KILOMETERS 0 1 2 3 4 5

MILESo 2 3

JULY 19O