Mali - Urban Development Project : Credit 0943 - Credit Agreement - Conformed

LOCUMENTS IT NUMBER 943 MLI Development Credit Agreement (Urban Development Project) between REPUBLIC O MALI and IMERNATIONAL DEVPLOPNENT ASSOCIATION Dated /4a,lp 7 1979 CREDIT NUMBER 943 MLI DEVELOPMENT CREDIT AGREEMENT AGREEMENT, dated , 1979, between the REPUBLIC OF MALI (hereinafter called the Borrower) and INTER- NATIONAL DEVELOPMENT ASSOCIATION (hereinafter called the Asso- ciation.) WHEREAS (A) the Borrower has requested the Association to assist in the financing of the Project described in Schedule 2 to this Agreement by extending the Credit as hereinafter provided; (B) part of the Project will be carried out by the District of Bamako (hereinafter called the District) and a part thereof by the Municipality of Mopti with the Borrower's assistance and, as part of such assistance, the Borrower will make available to the District and to the Municipality of Mopti a portion of the proceeds of the Credit as hereinafter provided; (C) by letters addressed by the Association to the Minister 'of Finance and of Commerce of the Borrower on April 13, 1977 and January 31,1979, the Association granted advances to the Borrower totalling $480,000 for the preparation of the Project; (D) pursuant to the terms of said advances the amounts thereof are to be refunded to the Association out of the proceeds of the Credit provided for in this Agreement; and WHEREAS the Association has agreed, on the basis inter alia of the foregoing, to extend the Credit to the Borrower upon the terms and conditions set forth hereinafter and in the Project Agreement of even date herewith among the Association, the Dis- trict and Mopti; NOW THEREFORE the parties hereto hereby agree as follows: ARTICLE I General Conditions; Definitions Section 1.01. The parties to this Agreement accept all the provisions of the General Conditions Applicable to Development Credit Agreements of the Association, dated March 15, 1974, with the same force and effect as if they were fully set forth herein (said General Conditions Applicable to Development Credit Agreements of the Association being hereinafter called the General Conditions). -2- Section 1.02. Wherever used in this Agreement, unless the context otherwise requires, the several terms defined in the General Conditions and in the Preamble to this Agreement have the respective meanings therein set forth and the following additional terms have the following meanings: (a) "Project Agreement" means the agreement among the Association, the District and the Municipality of Mopti of even date herewith, as the same may be amended from time to time, and such term includes all schedtles to the Project Agreement and all agreements supplemental to the Project Agreement; (b) "Financing Agreement" means either of the agreements to be entered into between the Borrower and the District and the Municipality of Mopti, respectively, pursuant to Section 3.01 (d) of this Agreement, as the same may be amended from time to time, and such term includes all schedules to the Financing Agreements; (c) "CAFOBA" means - the Caisse FonciAre de Bamako, a land management agency of the Borrower to be established under the Project; and (d) "Project Unit" means the unit to be established pursuant to Section 3.01 (b) of this Agreement. ARTICLE II The Credit Section 2.01. The Association agrees to lend to the Borrower, on the terms and conditions in the Development Credit Agreement set forth or referred to, an amount in various currencies equiva- lent to twelve million dollars ($12,000,000). Section 2.02. (a) The amount of the Credit may be withdrawn from the Credit Account in accordance with the provisions of this Section and of Schedule 1 to this Agreement, as such Schedule may be amended from time to time by agreement between the Borrower and the Association, for expenditures made (or, if the Association shall so agree, to be made) in respect of the reasonable cost of goods and services required for the Project and to be financed out of the proceeds of the Credit. (b) Promptly after the Effective Date, the Association shall, on behalf of the Borrower, withdraw from the Credit Account -3- and pay to itself the amount required to repay the principal amount of the advances referred to in the Preamble to this Agree- ment withdrawn and outstanding as of such date and to pay any unpaid charges thereon. Any unwithdrawn balance of the authorized amount of such advances shall automatically be cancelled on the same date. Section 2.03. Except as the Association shall otherwise agree, procurement of the goods and civil works to be financed out of the proceeds of the Credit, shall be governed by the provisions set forth or referred to in Schedule 3 to this Agreement. Section 2.04. The Closing Date shall be December 31, 1983 or such later date as the Association shall establish. The Association shall promptly notify the Borrower of such later date. Section 2.05. The Borrower shall pay to the Association a service charge at the rate of three-fourths of one per cent (3/4 of 1%) per annum on the principal amount of the Credit withdrawn and outstanding from time to time. Section 2.06. Service charges shall be payable semiannually on June l and December 1 in each year. Section 2.07. The Borrower shall repay the principal amount of the Credit in semiannual installments payable on each June 1 and December 1 commencing December 1, 1989, and ending June 1, 2029, each installment to and including the installment payable on June 1, 1999, to be one-half of one per cent (1/2 of 1%) of such principal amount, and each installment thereafter to be one and one-half per cent (1-1/2%) of suct principal amount. Section 2.08. The currency of the French Republic is hereby specified for the purposes of Section 4.02 of the General Condi- tions. ARTICLE III Execution of the Project Section 3.01. (a) The Borrower shall carry out Parts C (2), D (2), E, F and G of the Project and shall cause the District to carry out Parts A, B, and C (1), and the Municipality of Mopti to carry out Part D (1) thereof, with due diligence and efficiency -4- and in accordance with appropriate administrative, financial, economic and technical practices and standards, and shall provide, promptly as needed, the funds, facilities, services and other resources required for the purpose. (b) For the purposes of paragraph (a) above, the Borrower shall establish and maintain a Project Unit, headed by a qualified and experienced Project Director, as described in Schedule 4 to this Agreement. (c) Without any limitation or restriction upon any of its other obligations under the Development Credit Agreement, the Borrower shall cause the District and the Municipality of Mopti to perform in accordance with the Project Agreement and the Financ- ing Agreements, all the obligations therein set forth, shall take and cause to be taken all action, including the provision of funds, facilities, services and other resources, necessary or appropriate to enable the District and the Municipality of Mopti to perform such obligations, and shall not take or permit to be taken any action which would prevent or interfere with such performance. (d) The Borrower: (i) shall relend to the District the proceeds of the Credit allocated and withdrawn from the Credit account for Parts A (1) and (4), B, and C (1), of the Project and shall make available as grants to the District the proceeds of the Credit so allocated and withdrawn for Parts A (2) and (3) thereof and (ii) shall relend to the Municipality of Mopti the proceeds of the Credit allocated and withdrawn from the Credit Account for Part D (1) of the Project, under Financing Agreements to be entered into between the Borrower and the District and the Munici- pality of Mopti, respectively under terms and conditions which shall have been approved by the Association. (e) The Borrower shall exercise its rights under each of the Financing Agreements in such manner as to protect the interests of the Borrower and the Association and to accomplish the purposes of the Credit, and except as the Association shall otherwise agree, the Borrower shall not assign, amend, abrogate or waive either Financing Agreement or any provision thereof. Section 3.02. The Borrower shall transfer title to the land in Magnambougou included in the Project to the District prior to the allocation of lots. -5- Section 3.03. CAFOBA, to be established under Part G (2) of the Project, shall have such powers, duties and procedures as are specified in Schedule 5 to this Agreement. Section 3.04. The Borrower shall (i) cause the District, the Municipality of Mopti, the Directorates of Water Resources and Energy for the 1st and 7th Regions, the National Directorate of Urbanism and Construction and any other agency charged with carrying out any part of the Project, to keep separate accounts relating thereto and to furnish certified copies of such accounts to the Project Unit at the close of each year; and (ii) cause the Project Unit to prepare consolidated yearly accounts on the basis thereof. Section 3.05. The Borrower shall take such steps as shall be necessary or useful on its part to authorize and enable the costs of the Project to be recovered from the beneficiaries thereof in the manner and to the extent set forth in Schedule 6 to this Agreement. ARTICLE IV Other Covenants Section 4.01. (a) The Borrower undertakes to insure, or make adequate provision for the insurance of, the imported goods to be financed out of the proceeds of the Credit against hazards incident to the acquisition, transportation and delivery thereof to the place of use or installation, and for such insurance any indemnity shall be payable in a currency freely usable by the Borrower to replace or repair such goods. (b) Except as the Association may otherwise agree, the Borrower shall cause all goods and services financed out of the proceeds of the Credit to be used exclusively for the Project. Section 4.02. (a) The Borrower shall furnish to the Associa- tion, promptly upon their preparation, the plans, specifications, contract documents and work and procurement schedules for the Project, and any material modifications thereof or additions thereto, in such detail as the Association shall reasonably request. IiI -6- (b) The Borrower: (i) shall maintain records and procedures adequate to record and monitor the progress of the Project (including its cost and the benefits to be derived from it), to identify the goods and services financed out of the proceeds of the Credit, and to disclose their use in the Project; (ii) shall enable the Association's accredited representatives to visit the facilities and construction sites included in the Project and to examine the goods financed out of the proceeds of the Credit and any relevant records and documents; and (iii) shall furnish to the Association all such information as the Association shall reasonably request concerning the Project, its cost and, where appropriate, the benefits to be derived from it, the expenditures of such proceeds and the goods and services financed out of such proceeds. (c) Promptly after completion of the Project, but in any event not later than six months after the Closing Date or such later date as may be agreed for this purpose between the Borrower and the Association, the Borrower shall prepare and furnish to the Association a report, of such scope and in such detail as the Association shall reasonably request, on the execution and initial operation of the Project, its cost and the benefits derived and to be derived from it, the performance by the Borrower and the Association of their respective obligations under this Agreement and the accomplishment of the purposes of the Credit. Section 4.03. The Borrower shall ensure that the classrooms and the health facility established under Part A (3) of the Project be provided with the funds and personnel required for their operations. Section 4.04. The Borrower shall exchange views with the Association on any proposed new program of housing construction. ARTICLE V Financial Covenants Section 5.01. The Borrower shall cause the District to main- tain records adequate to reflect in accordance with consistently maintained appropriate accounting practices its operations and -7- financial condition and shall ensure that: (i) all accounts with respect to the Project be kept separate from the other accounts of the District; and (ii) that there be retained, until one- year after the Closing Date, all records (orders, invoices, bills, receipts and other documents) evidencing the expenditures for the Project on account of ,which withdrawals are requested from, the Credit Account on the basis of certificates of expenditures, and shall enable the Association's accredited representatives to examine such records. Section 5.02. The Borrower shall take such steps as are necessary to ensure that the Project unit: (a) has the consolidated accounts referred to in Section 3.04 of this Agreement audited for each fiscal year in accor- dance with appropriate auditing principles consistently applied, by independent auditors acceptable to the Association; (b) furnish to the Association as soon as available, but in any case not later than six months after the end of each such year, the report of such audit by said auditors, of such scope and in such detail as the Association shall have reasonably requested, including, without limitation to the foregoing, sepa- rate opinions by said auditors: (i) on the separate accounts referred to in Section 5.01 of this Agreement; and (ii) in respect of the expenditures and records referred to in Section 5.01 (ii-) of this Agreement, as to whether the proceeds of the Credit withdrawn from the Credit Account on the basis of certificates of expenditure have been used to make payments for goods received, or works or services performed, and that such goods, works and services were eligible for financing under this Agreement and were used in the carrying out of the Project; and (c) furnish to the Associatiori such other information concerning the accounts and financial statements relating to the Project and the audit thereof as the Association shall from time to time reasonably request. ARTICLE VI Remedies of the Association Section 6.01. For the purposes of Section 6.02 of the General Conditions, the following additional events are specified pursuant to paragraph (h) hereof: 8- (a) the District or the Municipality of Hopti shall have failed to carry out any of their obligations under the Project Agreement; and (b) the District or the Municipality "' Mopti shall have failed to carry out any of its obligations under its Financing Agreement with the Borrower. Section 6.02. For the purposes of Section 7.01 of the General Conditions, the following additional event is specified pursuant to, paragraph (d) thereof, namely, that any event specified in Section 6.01 of this Agreement shall occur and shall have con- tinued for a period of thirty days after notice thereof shall have been given by the Association to the Borrower. ARTICLE VII Effective Date; Termination Section 7.01. The following events are specified as addi- tional conditions to the effectiveness of the Development Credit Agreement within the meaning of Section 12.01 (b) of the General Conditions: (a) the Financing Agreement has been executed on behalf of the Borrower and the District; and (b) the Borrower has opened a special account in the name of the Project Unit in the Development Bank of Mali for the financing of the Project, in an amount of at least 100 million Malian francs. 4 Section 7.02. The following are specified as additional matters, within the meaning of Section 12.02 (b,) of the General Conditions, to be included in the opinion or opinions to be furnished to the Association: (a) that the Project Agreement has been duly authorized or ratified by the District and by the Municipality of Mopti, and is legally binding upon such parties in accordance with its terms; and (b) that the Financing Agreement between the Borrower and the District has been duly authorized or ratified by the Borrower and the District and is legally binding upon the Borrower and the District in accordance with its terms. i~- 9 - 9- Section 7.03. The date February 5, 1980, is hereby speci- fled for the purposes of 3ection 12ti General Condi- tions. ARTICLE VIII Representative of the Borrower; reages Section 8.01. The Minister of th.. e -ëspon%:1}e for finance is designated as representative of the Borrower for thé purposes of Section 11.3 of the General Conditions- Section K.02. The following addresses are specified for the purpose of Section 11.01 of the General Conditions: For the Borrover: Ministère des Finances'et du Commerce Koulouba Republic 'of Mali Cable address: Telex: MINIFINANCES 972559 Koulouba For the Association: International Devlopment Association 1818 H Street, N.'. Washington, D.C. 20433 United States of America Cable address: Telex: INDEVAS 440098 (ITT) Washington, D.C. 248423 (RCA) or 64145 (WUI) IN WITNESS WHEREOF, the parties hereto, acting through their representatives thereunto duly authorized, have caused this Agreement to be signed in their respective names in the District - 10 - of Columbia, United States of America, as of the day and year first above written. REPUBLIC OF MALI By Authorized Representative INTERNATIONAL DEVELOPMENT ASSOCIATION By Regional Vice Président Western Africa Ap - 11.- SCHEDULE 1 Withdrawal of the Proceeds of the Credit 1. The table below sets forth the Categories of items to be financed out of the proceeds of the Credit, the allocation of the amounts of the Credit to each Category and the percentage of expenditures for items so to be financed in each Category: Amount of the Credit Allocated % of (Expressed in Expenditures Category* Dollar Equivalent) to be Financed (1) Civil Works 70% (a) District: Parts 3,200,000 A, B, C and G (b) Mopti: Part D (1) 20,000 (c) Gao and Kayes: 300,000 Part D (2) (2) Equipment, vehicles 100% of foreign materials and supplies expenditures or, if purchased domestically, 80% of local expendi- tures (a) Parts A (3), C (2) 2,160,000 and G (b) Mopti: Part D (1) 200,000 (c) Gao and Kayes: 100,000 Part D (2) (3) Refinancing: 1,000,000 100% Part A (4) (4) Project Unit 40,000 80% of local operating costs expenditures * References to Parts are to Parts of the Project as set forth in Schedule 2 hereof. -12- Amount of the Credit Allocated % of (Expressed in Expenditures Category* Dollar Equivalent) to be Financed (5) Services of 3,000,000 100% consultants and experts (6) 1Refunding of ad- 480,000 amount outstand- vances for ing at Effective Project preparation Date (7) Unallocated 1,500,000 TOTAL 12,000,000 2. For the purposes of this Schedule: (a) the term "foreign expenditures" means expenditures in the currency of any country other than the Borrower and for goods or services supplied from the territory of any country other than the Borrower; and (b) the term "local expenditures" means expenditures in the currency of the Borrower and for goods or services supplied from the territory of the Borrower. 3. The disbursement percentages have been calculated in com- pliance with the policy of the Association that no proceeds of the Credit shall be disbursed on account of payments for taxes levied by, or in the territory of, the Borrower on goods or services, or on the importation, manufacture, procurement or supply thereof; to that end, if the amount of any such taxes levied on or in respect of any item to be financed out of the proceeds of the Credit decreases or increases, the Association may, by notice to the Borrower, increase or decrease the disbursement percentage then applicable to such item as required to be consistent with the aforementioned policy of the Association. 4. Notwithstanding the provisions of paragraph 1 above, no withdrawals shall be made in respect of (i) expenditures incurred * References to Parts are to Parts of the Project as set forth in Schedule 2 hereof. -13- prior to the date of this Agreement; provided, however, that withdrawals in an amount not exceeding the equivalent of $450,000 may be made under Categories (2) and (5) for expenditures incurred prior to such date but after June 1, 1979; or (ii) Part D (1) of the Project until the Borrower and the Municipality of Mopti have entered into their Financing Agreement. 5. Notwithstanding the allocation of an amount of the Credit or the disbursement percentages set forth in the table in para- graph 1 above, if the Association has reasonably estimated that the amount of the Credit then allocated to any Category will be insufficient to finance the agreed percentage of all expenditures in that Category, the Association may, by notice to the Borrower: (i) reallocate to such Category, to the extent required to meet the estimated shortfall, proceeds of the Credit which are then allocated to another Category and which in the opinion of the Association are not needed to meet other expen- ditures, and (ii) if such reallocation cannot fully meet the estimated shortfall, reduce the disbursement percentage then applicable to such expenditures in order that further withdrawals under such Category may continue until all expenditures thereunder shall have been made. 6. If the Association shall have reasonably determined that the procurement of any item in any Category is inconsistent with the procedures set forth or referred to in this Agreement, no expenditures for such item shall be financed out of the proceeds of the Credit and the Association may, without in any way res- tricting or limiting any other right, power or remedy of the Association under the Development Credit Agreement, by notice to the Borrower, cancel such amount of the Credit as, in the Asso- ciation' s reasonable opinion, represents the amount of such expenditures which would otherwise have been eligible for financing out of the proceeds of the Credit. -14- SCHEDULE 2 Description of the Project The Project is designed to assist the Borrower, the District, the Municipality of Mopti and the towns of Gao and Kayes in providing affordable urban services, particularly shelter, water supply, garbage collection, drainage, schools and facilities for health, to low-income urban residents. The Project, to be administered by the Project Unit, includes the following: Part A Neighborhood Improvements: 1. Upgrading the neighborhood of Magnambougou in the District (about 100 ha) and developing sites-and-services adjacent to such neighborhood, including provision of infrastructure, and alloca- tion of lots; 2. Construction of off-site infrastructure necessary for the neighborhood referred in 1 above; construction of drainage outlets in Rozola-Niarela; 3. Construction of about 24 primary school classrooms and one health center in Magnambougou; and 4. Provision, through the Housing Directorate of the District, of refinancing of the costs incurred by the beneficiaries of Parts A (1) and C of the Project, for the purchase of construction material, hiring labor, acquiring lots, and purchasing tools and equipment (about 400 tools or equipment loans) as provided in Schedule 6 to this Agreement; Part B: Municipal Assistance 1. Purchase of vehicles, equipment, material and supplies for garbage collection and for cleaning, repair, and maintenance of drainage ditches; 2. Repair, relocation or construction of about 120 standpipes, in the District; 3. Construction of 10 public lavatories and of the Municipal workshop and depot of the Technical Directorate of the District (Voierie); purchase of materials and equipment for the purpose; and - 15 - 4*, Organization of the, District's Housing Directorate and reorganization of its Technical Directorate; training of their staff. Part C: Markets 1. Construction of four retail markets in the District; and 2. The promotion of the use of local building materials; training of construction workers and the purchase of equipment for the purpose. Part D: Secondary Cities 1. Construction of garbage collection points, and public toilets, purchase of vehicles, materials and equipment for sewage and garbage collection in Mopti; .and 2. Repair, reinforcement and construction of water-supply networks and purchase of equipment therefor, in Gao and Kayes. Part E: Project Administration and Execution 1. Training of staff of the Project Unit; auditing of Project accounts; and 2. Conducting aerial surveys and production of photoplans of the District for the Regional Directorate of Taxes and the Land Registry of the District. Part F: Studies Studies to establish an investment program for the District, (including the completion of the structural plan) and for the preparation of a future urban project. Part G: Assistance to Institutions 1. Purchase of vehicles, equipment, material and supplies for the Project Unit, the Regional Directorate of Taxes, the Land Registry and the Housing Directorate of the District; and 기 17 SCHEDULE 3 Procurement A. International Competitive Bidding 1. Except as provided in Part D and F hereof, goods and civil works shall be procured under contracts awarded in accordance with procedures consistent with those set forth in the "'Guidelines for Procurement under World Bank Loans and IDA Credits" published by the Bank in March 1077 (hereinafter called the Guidelines), on the A basis of international competitive bidding as described in Part A of the Guidelines. 2. For goods and works to be procured on the basis of inter- national competitive bidding, in addition to the requirements of paragraph 1.2 of the Guidelines, the Project Unit, on behalf of the Borrower, the District or the Municipality of Mopti, as the case may be, shall prepare and f ' orward to the Association as soon as possible, and in any event not later than 60 days prior to the date of availability to the public of the first tender or pre- qualification documents relating thereto, as the case may be, a general procurement notice, in such form aixd detatl and containing. Y" such information as the Association shall,,reasonably request; the Association will arrange for the publication of such notice in order to provide timely notification to prospective bidders of the opportunity to bid for the goods and works in question. The Project Unit shall provide the necessary information to update such notice annually so long as any goods or works remain to be procured on the basis of international competitive bidding. 3. For the purpose of evaluation and comparison of bids for the supply of goods to be procured -on the basis of international competitive bidding: (i) bidders shall be required to state in their bid the c.i.f. (port of entry) price for imported goods, or the ex-factory price for domestically manufactured goods; (ii) customs duties and other import tekxes on imported goods, and sales and similar taxes on domestically supplied goods, shall be excluded; and (iii) the cost to the purchaser of inland freight and other expenditures incidental to the delivery of goods to the place of their use or installation shall be included. B. Preference for Domestic Manufacturers In the procurement of goods in accordance with the procedures described in Part A of this Schedule, goods manufactured in Mali -18- may be granted a margin of preference in accordance with, and subject to, the following provisions: 1. All bidding documents for the procurement of goods shall clearly indicate any preference which will be granted, the information required to establish the, eligibility of a bid for such preference and the following methods and stages that will be followed in the evaluation and comparison of bids. 2. After evaluation, responsive bids will be classified in one of the following three groups: (1) Group A: bids offering goods manufactured in Mali if the bidder shall have established to the satisfaction of Mali and the Association that the manufacturing cost of such goods includes a value added in Mali equal to at least 20% of 'the ex- factory bid price of such goods. (2) Group B: all other bids offering goods manufactured in Mali. (3) Group C: bids offering any other goods. 3. All evaluated bids in each group shall be first compared among themselves, excluding any customs duties and other import taxes on goods to be imported and any sales or similar taxes on goods to be supplied domestically, to determine the lowest evaluated bid of each group. Such lowest evaluated bids shall then be compared with each other, and if, as a result of this comparison, a bid from group A or group B is the lowest, it shall be selected for the award. 4. If, as a result of the comparison under paragraph 3 above, the lowest bid is a bid from group C, all group C bids shall be further compared with the lowest evaluated bid from group A after adding to the evaluated bid price of the imported goods offered in each group C bid, for the purpose of this further comparison only, an amount equal to: (i) the amount of customs duties and other import taxes which a non-exempt importer would have to pay for the importation of the goods offered in such group C bid; or (ii) 15% of the c.i.f. bid price of such goods if said customs duties and taxes exceed 15% of such price. If the group A bid in such further comparison is the lowest, it shall be selected for the award; if not, the bid from group C I 19I which as a result of the comparison under paragraph 3 is the lowest evaluated bid shall be selected. C. Preference for Domestic Contractors With respect to the evaluation of bids for any contract for civil works included under Category (1) of the table set forth in Schedule 1 to the Development Credit Agreement and to be procured in accordance with the procedures described in Part A of this Schedule, the Borrower, the District and the Municipality of Mopti, as the case may be, may grant a margin of preference of 7-1/2% to domestic contractors, in accordance with, and subject to, the following provisions: 1. Contractors applying for such preference shall be asked to provide, as part of the data for qualification, such infor- mation, including details of ownership, as shall be required to determine whether, according to the classification accepted by the Association, a particular firm or group of firms qualifies for a domestic preference. The bidding documents shall clearly indicate the preference and the method that will be followed in the eva- luation and comparison of bids to give effect to such preference. 2. After bids have been received and reviewed by the Project Unit, responsive bids will be classified into the follow- ing groups: (i) bids offered by domestic contractors eligible for preference; and (ii) bids.offered by other contractors. For the purpose of evaluation and comparison of bids an amount equal to 7-1/2% of the bid amount shall be added to bids received under group (ii) above. D. Other Procurement Procedures 1. Contracts estimated to cost less than the equivalent of $400,000 for municipal services and community facilities, and for civil works in Gao and Kayes, may be procured following the applicable procedures of the Borrower for competitive bidding. 2. Items of equipment or materials estimated after grouping to cost less than the equivalent of $50,000 may be procured on the -20- basis of quotations solicited from at least three competing suppliers; provided that unless otherwise agreed with the Associa- tion, the total of such procurement shall not exceed the equiva- lent of $800,000. E. Review of Procurement Decisions by the Association Review of invitations to bid and of proposed awards and final contracts: 1. With respect to all civil works contracts and all other contracts estimated to cost the equivalent of $100,000 or more: (a) Before bids are invited, the Project Unit shall furnish to the Association, for its comments, the text of the invitations to bid and the specifications and other bidding documents, together with a description of the advertising procedures to be followed for the bidding, and shall make such modifications in the said documents or procedures as the Association shall reasonably request. Any further modification to the bidding documents shall require the Association's concurrence before it is issued to the prospective bidders. (b) After bids have been received and evaluated, the Project Unit shall, before a final decision on the award is made, inform the Association of the name of the bidder to which it intends to award the contract and shall furnish to the Association, in sufficient time for its review, a detailed report, by the Project Unit, on the evaluation and comparison of the bids received, together with the recommendations for award of the Project Unit and such other information as the Association shall reasonably request. The Association shall, if it determines that the intended award would be inconsistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. (c) The terms and conditions of the contract shall not, without the Association's concurrence, materially differ from those on which bids were asked. (d) Two conformed copies of the contract shall be furnished to the Association promptly after its execution and prior to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract. ~A - 21 - 2. With respect to eackm contract not governed by the preceding paragraph, the Project Unit shall frnish to the Association, promptly after its execution an&-i or to the submission to the Association of the first application for withdrawal of funds from the Credit Account in respect of such contract, two conformed copies of such contract, together with the analysis of the respec- tive bids, recommendations for award and such other information as the Association shall reasonably request. The Association shall, if it determines that the award of the contract was not consistent with the Guidelines or this Schedule, promptly inform the Borrower and state the reasons for such determination. 3. Before agreeing to any material modification or waiver of the terms and conditions of a contract, or granting an extension of the stipulated time for performance of such contract, or issuing any change order under such contract (except in cases of extreme urgency) which would increase the cpst of the contract by more than 15% of the original price, the Project Unit shall inform the Association of the-proposed modification, waiver, extension or change order and the reasons therefor. The Associa- tion, if it determines that the proposal would be inconsistent with the provisions of this Agreement, shall promptly inform the Borrower and state the reasons for its determination. F. Procurement Without Contracting The clearing and repair of drainage ditches and the repair of standpipes may be carried out under force account by the District. - 22 - SCHEDULE 4 The Project Unit The Project Unit will report directly to the Minister of the Borrower responsible for the interior. In addition to National administrative staff consisting of engineers (2), accountants (2), draftemen (2), and secretarles (2), the ýDirector of the Project will be-assisted by six experts (the Project leader-administrator, a systems analyst, a municipal management expert, a municipal engineer, a mechanic rand a local building materials expert). The Directr- of the Project vill have the rank of National Director. The tasks of the Project Unit will be to assist the Borrower, the District services and the regional governaental services respon- sible for carrying out the Pröject. Specifically, the Project Unit Will: (a) plan, coordinate and supervise the carrying out of the Project; (b) manage the legal and financial aspects of the Project (tontracts, requests for disbursements); and (cc) monitor the carrying out of the Project. CY.- 1kl - 23 - SCHEDULE 5 Land Management Agency (CAFOBA) As part of the strengthening of institutions in the shelter sector, a Land Management? Agency would be set up to manage all state owned land in the urbanization perimeter of the District belonging to the State or to communities. The National Directorat1 of Taxes will have prime responsibility for the establishmert of the Land Management Agency, which will be carried out ia phases during Project execution, as follows: (a) First Phase (to be completed by June 30, 1980): The National Directorate of Taxes would establish a Land Registry withj the responsibilities set forth in Article 4 of Arr8t6 No. 1771/MFC-DNI of May 3, 1979 as such text may be amended. During this period the National Directorate of Urbanism and Construction- will complete and publish by January 1, 1980 an outline structural plan for the development of Bamako, which will form the basis of land policy within the District and will establish preliminary guidelines for land use. (b) Second Phase (to be completed by June 30,1981): The Land Registry will extend the procedures developed in the First Phase to all land included in the urbanization perimeter of the district, while the Directorate of Urbanization and Construction will conduct the Invest- ment Programming Study under the Project and the National Directorate of Taxes will establish the admi- nistrative procedures and decrees for the establishment of CAFOBA. (c) Third Phase (to be completed by June 30, 1982): estab- lishment of CAFOBA as an autonomous agency under the technical tutelage of the Ministry responsible for Finance. The phased establishment of CAFOBA will be monitored and assisted by the Project Unit. i k -24- SCHEDULE 6 Cost Recovery A. Cost Recovery 1. The following principles of cost recovery are to be applied for the various elements of the Project: (a) those costs which are ordinarily recovered by public authorit fes through user charges or tariffs will be similarly recovered (e.g. primary infrastructure for water, electricity, markets); (b) costs of urban services provided by the District will be recovered via special taxes (e.g. garbage collection, reet cleaning, water from standpipes); ( all site-development related costs comprising on-site infrastructure, refinancing of construction, design, engineering and supervision will be borne directly by beneficiaries. 2. Cost recovery sources from components of the Project are as follows: Project component Method of Recovery (a) Recovered 1. Land Repayments 2. On-site infrastructure Repayments 3. Off-site infrastructure Electricity and water tariffs 4. Primary schools Scholastic Fund 5. Construction refinancing Repayments 6. Garbage collection New garbage collection tax 7. Clearing of drainage ditches Tax (de voirie) 8. Standpipes Tax (de voirie) 9. Retail markets Stall rentals 10. Artisan credit Repayment 11. Mopti garbage collection Mudicipal taxes 12. Gao water supply Water tariff 13. Kayes water supply Water tariff 14. Land Management Agency Revenue from land development - 25 - (b) Not recovered; Technical Assistance, studies 15. Aerial photo survey Not recovered 16. Technical assistance, Not recovered Project Unit 17. Regional Directorate of Taxes Not recovered 18. Studies Not recovered (c) Not recovered 19. Health facilities Not recovered 20. Public Lavatories Not recovered 21. Drainage outlets Not recovered 22. Building and equipment, Not recovered Technical Directorate 23. Development of local Not recovered building materials 3. Lot charges in the sites and services area would be dif- ferentiated to take into account location, lot accessibility, size of lot and the form of tenure (freehold and rental-purchase)- applicable to different lots. Four price categories will be distinguished: (i) "A" lots (320 m2) and A 1 (160 m2), one- half of A are the smallest and will be leased at a price somewhat (about 10%) below cost; (ii) "B" lots (374 m2) will be leased at slightly above (about 15%) cost; and "C" lots (500 m2) will be sold freehold at fair market value. The net sales proceeds of the larger lots would be used to reduce the prices of the smallest lots, which would be available to the lowest income groups of the target population. 4. A downpayment of 10% of the total price would be required for new lots subject to rental-purchases. Payment of the down- payment would also entitle the beneficiary to refinancing for construction, the amount of which would vary according to the beneficiary's ability to pay the combined monthly payments for the lot and for such refinancing, but which would, in-any event, be limited to a ceiling of MF165,000. No downpayments would be required in upgrading areas where lots will be acquired under rental-purchases; beneficiaries of such lots may also obtain refinancing for construction up to MF55,000. The balance for both lot and building materials would be repaid through monthly installments at 12% per annum over a maximum of 20 years. -26- 5. Contracts for rental-purchases will provide for resiliation in the case of non-payment by beneficiaries beyond three months. 6. Recovery of the costs of retail markets will be through stall fees for the covered stalls in the market place, and rents for the shops and artisans lots alongside the market. Refinancing for artisans for construction of workshops on the 50 artisans lots located beside the markets would be made available under the Project up to a maximum of MF275,000 per lot. Refinancing of up, to MF50,000 would be available to 400 artisans to finance purchases of materials or small equipment and tools. Terms of such refinancing would be at 12% interest, repayable over ten years for construction loans, and over three years for materials and tools. 7. Amounts stipulated in paragraph 6 above are subject to revision each year by agreement between the Borrower and the Association in order to reflect changes in the cost of living. B. Municipal Taxes 8. The costs of the improvements to municipal services will be recovered through the introduction of maintenance taxes (voirie and garbage collection taxes assessed on rental values of proper- ties) on a city-wide basis. The new taxes will be collected beginning in 1981 and will be set at rates sufficient to cover the costs of the services rendered, including depreciation of equip- mente INTERNATIONAL DEVELOPMENT ASSOCIATION CERTIFICATE I hereby certify that the foregoing is a true copy of the original in the archives of the Interna- tional Development Association. In witness whereof I have signed this Certifi- cate and affixed the Seal of the Association thereunto the day, of 197F S T FOR SECRETARY