Philippines - Provincial Cities Water Supply Project

Docment of The World Bank FOR OFFICIAL USE ONLY Report No. 6422 PROJECT PERFORMANCE AUDIT REPORT PHILIPPINE S PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-Ph) September 29, 1986 Operations Evaluation Department This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. FISCAL YEAR January 1 - December 31 MEASURES mm = millimeter = 0.04 inches cm = centimeter = 0.39 inches m= meter = 3.28 feet km = kilometer = 0.62 miles km2 square kilometer = 0.39 square miles cu m = cubic meter = 264 US gallons per day cu m/sec. = cubic meters per second = 22.8 million US gallon per day 1/cd liters per capita per day = 0.26 US gallons per capita per day. PRINCIPAL ABBREVIATIONS AND ACRONYMS ADB - Asian Development Bank BPW - Bureau of Public Works DOH - Department of Health DPWTC - Department of Public Works, Transportation and Com--unication GOP - Government of the Philippines IDC - Interest and other charges on loans during construction LA - Loan Agreement LWUA - Local Water Utilities Administration MMA - Metropolitan Manila Area MWSS - Metropolitan Waterworks and Sewerage System NAWASA - National Waterworks and Sewerage System NEDA - National Economic and Development Authority PR - President's Report RWDC - Rural Waterworks Development Corporation SAR - Staff Appraisal Report USAID - United States Agency for International Development WD - Water District THE WORLD BANK FOR OFFICIAL UB ONLY Washngton, D.C. 20433 U.S.A. 01ce M Ofctm-Genal Opeatmm Evaumten - September 29, 1986 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Performance Audit Report on the Philippines - Provincial Cities Water Supply Project (Loan 1415-PH) Attached, for information, is a copy of a report entitled "Project Performance Audit Report on the Philippines - Provincial Cities Water Supply Project (Loan 1415-Ph)" prepared by the Operations Evaluation Department. Attachment This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its ctntents may not otherwise be disclosed without World Bank authoriation. FOR OFFICIAL USA ONLY PROJECT PERFORMANCE AUDIT REPORT PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) TABLE OF CONTENTS Page Not Preface ***************************** Basic Data Sheet ....................................... ....... ii Evaluation Summary ............................................... v PROJECT PERFORMANCE AUDIT MEMORANDUM I. PROJECT BACKGROUND ........I....................... . 1 Introduction ............................. 1 Project Formulation ........................................ 1 The Project and Its Objectives ............................. 2 II. PROJECT IMPLEMENTATION AND OUTCOME ........................... 4 Start-up and Effectiveness .....4..................... 4 Project Revisions and Implementation ....................... 4 Project Costs ....................................6e..... 6 Funding .................................................... 6 Project Administration and Bank Procedures ................. 7 Management and Institutional Development ................... 9 Project Results and Impact ................... ..... 11 Sustainability o.. ..................... ....... 12 III. FINDINGS AND ISSUES ........................... 13 Overview ........................................ ... 13 Lessons ........................... 13 ANNEX 1 .................................................****.... 15 PROJECT COMPLETION REPORT I* Introduction .......................... 16 II. Project Preparation and Appraisal ........................... 17 III. Project Implementation ...................................... 19 IV. Operating Performance .................................... 23 V* Financial Performance ................................... 25 VI. Institutional Performance and Development ................... 27 VII. Economic Re-evaluation ............................... 31 VIII. Bank's Performance .......................................... 31 IX. Conclusions ............................................... 32 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. TABLE OF CONTENTS (Continued) Page No. ANNEXES 1* Project Description ....................................... 34 2. Compliance with Covenants .................................. 35 3. History of Water Tariffs .................................... 37 4. Revisions to Winter Supply Components Project Elements of Baguio .......................... 38 5. Feasibility Study Project Areas ............................. 44 6. Project Cost - Actual and Appraisal Estimate ................ 45 7. Cumulative Estimated and Actual Disbursements ............... 46 8. Water Production, Sales and Connections ..................... 47 9. Unaccounted-for Water ....................................... 48 10. Local Water Utilities Administration ........................ 49 11. All WDS Combined: 1977-1982 ................................. 50 12. Name of Water District: Bagtio .............................. 53 13. Organizational Chart ..... .... .... 71 14. Typical Water District - Organizational Chart ............... 72 15. Calculation of Economic Internal Rate of Return ............. 73 MAP - IBRD No.12542 PROJECT PERFORMANCE AUDIT REPORT PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PR) PREFACE This report presents the results of a performance audit of the Provincial Cities Water Supply Projec: for which Loan 1415-PH for US$23.0 million was approved and signed in Mef 1977. The loan, made to tie Govern- ment of the Republic of the Philippines, became effective in September 1977. Most of. the loan was to be re-len.. to the Local Water Utilities Authority, nbw the Local Water Utilities Administration (LWUA), and the Metropolitan Waterworks and Sewerage Service (MWSS) of Manila. The balance was to be used by the Government to finance staff training programs. The original closing date of March 31, 1982 was extended to June 30, 1983 and the final disbursement was made on December 7, 1983 after an amount of US$1.22 million, deemed as surplus, had been cancelled. The Project Performance Audit Report (PPAR) consists of a Project Performance Audit Memorandum (PPAM), prepared by the Operations Evaluation Department (0ED), and Project Completion Report (PCR), dated June 12, 1984, prepared by the Urban and Water Supply Division of the East Asia and Pacific Regional Office. The PCR is based in part on the findings of a completion mission by Bank staff in March 1984. LWUA contributed technical and finan- cial infor-nation and LWUA's comments on an earlier draft PCR were incorpo- rated. OED have reviewed the PCR, the Appraisal and President's Reports, the legal documents, and the transcripts of the meeting of the Executive Directors when the loan was approved. Documents in the Bank files have been reviewed and Bank staff involved in project preparation and supervision have been interviewed to the extent possible. An OED mission visited the Philippines in December 1984, discussed the project with officers and staff of the implementing agencies, and inspected the construction components of the project in five of the six provincial C ties (Baguio, Lipa, Lucena, La Union (San Fernando) and Tarlac) which benefited directly from the project. In the opinion of the audit, the PCR is comprehensive and objective and, for the most part, describes the project experience in sufficient detail to support the findings and conclusions reached. The PPAM summarizes the PCR with minimum repetition, therefore, and provides additional comment only on loan disbursement anomalies and unbilled water. Following standard OED procedures, copies of the PPAR were sent to the Government, LUWA and MWSS for comments. However, none were received. - ii - PROJECT PERFORMANCE AUDIT BASIC DATA SHE4T PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PR) KEY PROJECT DATA Appraisal Actual or Current Expectation Estimates Total Project Cost (US$ million) 44.6 /a 33.6 /a /b Underrun (%) - 25 Total Project Cost (P million) 334.7 /a 297.3 /a Underrun (%) - 11 Loan Amount (USS million) 23.0 23.0 Disbursed 23.0 21.783 Cancelled (12/82) - 1.217 Date Physical Components Completed 12/81 06/83 Proportion Completed by Above Date (%)- 119 /c 95 77 Proportion of Time Overrun (%) 33 Economic Rate of Return 8 6 Financial Performance Good Poor Institutional Performance Good Satisfactory OTHER PROJECT DATA Item Original plan Revision Actual First Mention in Files 01/31/72 Governments Application /e - 07/17/75 Nogotiations 03/07/77 03/21/77 03/21/77 Board approval 05/03/77 - 05/03/77 Loan Agreement Date 05/13/77 05/13/77 Effectiveness Date 08/12/77 - 09/09/77 Closing Date 03/31/82 06/30/83 12/07/83 /f Borrower Government of the Republic the Philippines Executing Agency Local Water Utilities Administration Fiscal Year of Borrower January 1 - December 31 Follow-up Project: Name Provincial Cities Water Supply 11 Loan/Credit Number Loan 1710-PR/Credit 920-PH Amount (US$ million) Loan 16.0, Credit 22.0 Loan/Credit Agreement Date June 27, 1979 Ia Including interest and other charges on loans during construction. T7_ Based on average exchange rate during the implementation period. Ic Based on a comparison of appraised and installed pipe length, Td Based on a comparison of appraised and implemented number of connec- tions as of December 31, 1983. /e Letter from National Economic and Development Authority confirming interest in Bank financing for LWUA's proposed Provincial Cities Water Supply Project. /f Final disbursement date. - iii - STAFF INPUT (Staff-Weeks from Time Recording System) Bank FY 1974 1975 1976 1977 1978 1979 1980 Preappraisal/Appraisal 1.3 1.5 19.6 55.2 - - - Negotiations - - - 1"1.7 - - - Supervisiin - - - 3.0 13.6 9.3 11.7 1.3 1.5 19.6 72.9 13.6 9.3 11.7 Bank FY 1981 1982 1983 1984 Totals Preappraisal/Appraisal - - - - 77.6 Negotiations - - - - 14.7 Supervision 5.0 7.4 5.9 13.3 69.2 5.0 7.4 5.9 13.3 161.5 MISSION DATA Month/ No. of No. of Man- Date of Item Year Weeks /a Persons weeks Report Identification 05/75 2.5 3 7.5 06/25/75 Identification 11/75 2.5 2 5.0 12/08/75 Preparation 04/76 1.0 1 1.0 05/10/76 Appraisal 09/76 4.0 3 12.0 04/14/77 Total 10.0 25.5 Supervision I 08/77 1.0 2 2 09/14/77 Supervision II 06/78 1.0 1 1 06/29/78 Supervision III 11/78 1.0 2 2 12/12/78 Supervision IV 07/79 1.0 2 2 09/20/79 Supervision V 06/80 2.5 2 5 08/04/80 Supervision VI 03/81 1.0 2 2 04/08/81 Supervision VII 07/81 2.5 2 5 09/15/81 Supervision VIII 07/82 1.0 2 2 08/05/82 Supervision IX 04/83 2.5 2 5 05/09/83 Total 13.5 26 /a Field work only. Supervision missions of other Philippine water supply projects often included work on this project and vice versa. - iv - CUMULATIVE ESTIMATE AND ACTUAL DISBURSEMENTS (US$ million) Bank FY: FY78 FY79 FY80 FY81 FY82 FY83 FY84 Estimsted 4.18 11.38 17.54 21.83 23.00 23.00 23.00 Acutal 1.13 3.58 5.21 8.06 16.27 19.68 21.78 /a % of Actual to Estimated 27 31 30 37 71 86 95 COUNTRY EXCHANGE RATES Name of Currency (Abbreviation): Peso (P) Years: Appraisal Year Average (1977) US$1 = P7.40 Intervening Year Average (1978-82) US$1 - P7.74 Completion Year Average (1983) /b US$1 = P10.85 /a US$1.22 million cancelled December, 1982. /b January 1 - November 31. - v - PROJECT PERFORMANCE AUDIT REPORT PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) EVALUATION SUMMARY Introduction i. The Provincial Cities Water Supply project, for which Loan 1415-PH was made in May 1977 to the Government of the Philippines, was the second Bank loan for community water supply in the country. The first, for Manila (Loan 386-PH), was made about 13 years earlier and its implementation was unsatisfactory, particularly with respect to operations and financial per- formance. The Provincial Cities project came after major sector reorganiza- tions and benefited from prior technical assistance and development projects financed by USAID and other agencies, and which included establishment of what is now LWUA, the Local Water Utilities Administration (PPAM, paras. 1-3). ObiJectives ii. The project was intended to: ameliorate living and health standards in six provincial cities on the Island of Luzon by improving their water supply systems and assist institutional development of LWUA and of the Water District (WD) in each of those cities (Part A); prepare feasibility studies for additional WDs (Part B); update sewerage and sanitation plans for metro- politan Manila (Part C); and provide training (Part D) for Government staff involved with water supply in small communities (PPAM, paras. 7-9). iii. The loan of US$23.0 million was intended to cover the foreign exchange costs, including interest on the loan for Part A during construc- tion; US$18.8 million was to be re-lent to LWUA for Parts A and B, while the Metropolitan Waterworks and Sewerage Service (MWSS) was to receive US$4.0 million for Part C, and the Government ;iould retain the balance (US$0.2 million) for Part D (PPAM, paras. 6 and 10). Implementation Experier e iv. The whole project was completed with a time overrun of about 18 months (33%), mainly because of a change in procurement procedures for Part A (PPAM, paras. 15 and 18). The sewerage studies and designs (Part C) were completed about one year after the appraisal target date, however, in spite of a late start and an extension of the scope of work (PPAM, para. 19). - vi - v. Overall, cost estimating was good and in spite of the revisions made between preliminary planning and design on which the appraisal was bas..d, actual total costs were about 11% below estimates when expressed in Philippine pesos and about 25% below estimates when expressed in US dollars. However, the detailed cost records are inadequate to identify the true foreign exchange costs, but it is likely that they were less than half the appraisal estimates (PPAM, paras. 20-21). vi. Procurement was slow. In addition to the untimely change in the scope of the principal supply and construction contracts (PPAM, paras. 17-18), delays were caused by LWUA's inexperience and lengthy contract award approval requirements. Efficiency improved somewhat as the project pro- ceeded. Other zhan the above, there were no serious procurement issues between the Bank and the implementing agencies (PPAM, para. 28). Results vii. In terms of added production and distribution capacity, Part A of the project appears to have met its objectives. It is probable also that the targeted additional population to be served was reached, although no surveys were made to confirm this or to measure the social and economic benefits (PPAM, paras. 38 and 40-41). Unfortunately, much of the gain in water supply capacity was lost for lack of any reil progress toward the objective of reducing unbilled water (PPAM, para. 39). viii. The feasibility studies for 12 additional WDs (Part B) were carried out successfully and provided the basis for the follow-on Second Provincial Cities Water Supply Project (Credit 920-PH and Loan 1710-PH). Although delayed, the studies for Manila also were well conducted and led to the Manila Sewerage and Sanitation Project financed by Loan 1814-PH. The train- ing component of the project (part D) was unplanned and produced almost nothing (PPAM, paras. 16 and 17). LWUA's in-house training program, not part of the project, was excellent, however, in meeting the needs of LWUA and the WDs (PPAM, para. 48). ix. During the course of the project, LWUA experienced rapid growth and development. In the process it had some rather painful political and tech- nical lessons to learn. Mistakes were made and there were omissions. Capa- bilities did not keep up with growth, or with the overoptimistic expectations at the time of appraisal, particularly in the early years. Nevertheless, LWUA's performance is rated - correctly - by the Bank as satisfactory. Financial performance was the weak link, and this is exactly 'htre expecta- tions for the fledgling development agency were most unrealistic. The same thing applies to the performance of the WDs, half of which could not come close to meeting the financial goals set for them, and one had to be taken over by LWUA (PPAM, paras. 32-37). Inaction on the unbilled water situation (PPAM, para. 39) was a major factor in the shortfall in financial perform- ances of the WDS and LWUA. - vii - x. Because of the short-fall in financial performance of the WDs, the recalculated incremental rate of return for the six sub-projects, used as a proxy for the economic value, was about 6% compared to the expected 8%. Individually, the WD performances ranged from negative to about 12% (PPAM, para. 42). xi. Because of the way the allocation of loan proceeds was set up originally and later revised, actual disbursements could not and did not satisfy two objectives. The loan financed a substantial amount of the local currency costs, which was not intended. And financing of interest and other charges on the loan for Part A during construction, which originally was justified as an aid to the WDs and LWUA, ended up by benefiting MWSS, perhaps more than LWUA (PPAM, paras. 24-27). Sustainability xii. Sustaining or enhancing project benefits requires that special attention be given to action on reduction of unbilled water and redirection of LWUA priorities to focus as much, or more, on improvements in the effi- ciency of operations as on the establishment of new WDs and construction of new facilities. The unsatisfactory financial positions of the WDs and the Government's cut-back of financial support have indeed forced LWUA to take stock and regroup. Although LWUA management appreciates the problems that need to be solved, it is essertial to review and revise policies and proce- dures and to motivate the staff to attacking the problems with the same enthusiasm and sense of importance as was previously attached to new works. Performance on the Second Provincial Cities Water Supply Project indicates that LWUA still has a long way to go on these matters. Findings and Lessons xiii. The project was one of the better planned and implemented multi- city water supply projects financed by Bank Group loans. The major physical and study objectives appear to have been achieved, but the training component failed to meet its objectives. The optimistic expectations for institutional development and financial performance were unrealistic, particularly when improvements in operational efficiency were given secondary priority in planning. xiv. The audit takes exception to the conclusion in the PCR that Part A of the project as built incorporated significant over-design which had a major effect on the financial performance of the WD's (PPAM, para. 46). xv. The major lesson which emerges is that improvement of operational efficiency, including - or perhaps, especially - reduction of unbilled water, should never be allowed to have a secondary priority behind construction of new works. Furthermore, such efforts to improve performance require speci- fic, well-planned action programs. xvi. A second lesson is that loan withdrawal procedures should be care- fully drafted to meet the objectives of the project financing, which were part of the justification for the loan. - 1 - PROJECT PERFORMANCE AUDIT MEMORANDUM PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) I. PROJECT BACKGROUND Introduction 1. The first Bank loan for community water supply in the Philippines was made to the National Waterwajrks and Sewerage Authority (NWSA) for the Manila Water Project in July 1964 (Loan 386-PH). Implementation was unsatis- factory in several respects, including the inability of NWSA and its suc- cessor agency, the Metropolitan Waterworks and Sewerage System (MWSS), to satisfy key loan covenants pertaining to operations and financial perform- ance. In 1975, while the Bank was working with MWSS to rectify these prob- lems in preparation for a second Manila project (eventually financed by the Isian Development Bank), the Government approached the Bank for financial assistance with its ambitious program to improve the previously neglected water supply systems in provincial population centers (File Search; SAR; PCR, para. 1.03). At that time, surveys showed that less than half of the popula- tion of the Philippines had access to safe water supplies and there was a high level of disease related to poor water supplies and sanitation. Gastro- enteritis was the third most important cause of death in general, and the leading cause of death among infants; the infant mortality rate was an extremely high 70 per 1,000. 2. After the experience with the first water supply project for Manila, the Government made substantial progress in the early 1970s in reorganizing the sector and planning specific projects. In addition to dissolution of NWSA in 1971 and establishing MWSS with responsibility for water supply and sewerage in the Manila metropolitan area, the Local Water Utilities Authority, now the Local Water Utilities Administration (LWUA), was created in 1973 with responsibility for establishing Water Districts (WDs) and development and financing of water supply (and sanitation) systems (other than for Manila) in municipalities with populations above 20,000 (SAR; PCR, paras. 1.03 and 1.06). Project Formulation 3. Most of the groundwork for establishment of LWUA and the start of a provincial water supply program had been done with technical and financial assistance provided by USAID, including the preliminary designs for the proposed Bank-financed project. The Asian Development Bank (ADB) and the Danish International Development Agency (DANIDA) also had made loans for provincial water supply projects, and a sector study, carried out by staff of - 2 - the WHO/IBRD Cooperative Program in 1976, identified, in particular, the high priority of technical and managerial training throughout the sector (SAR; PCR, paras. 1.03, 1.04, 1.06 and 2.02). 4. The project for which Loan 1415-PH was made was appraised in September 1976. Negotiations took place six months later, in March 1977. As originally presented to the Bank, the physical components of the project were designed to meet U.S.A. standards of service and were considered (rightly) by the Bank's staff as being much in excess of reasonable requirements for the six cities where there would be sub-projects. LWUA eventually agreed, although reluctantly, and the designs were scaled down (SAR; PCR, para. 2.02). Annex 4 of the PCR provides a detailed listing of the physical components of each of the sub-projects as planned at the time the loan was made. 5. Other important issues had to be settled during the project preparation, appraisal and loan negotiation stages. One was about LWUA's capacity for making feasibility studies, appraisals, designs and supervision of construction of the sub-projects; it was agreed that consultants would advise LWUA on these activities. Tariffs and revenue objectives were issues. On these, it was agreed that: LWUA's existing tariff guidelines would be reviewed and revised; the tariffs of the individual WDs would be set to produce specific financial rates of return; and each WD would contribute from internal sources 10% of capital expenditures on the project during construction. Also, the initial tariff increases in the six WD's were set as a condition of negotiations. And finally, the responsibility for the training component of the project was an issue. Here, at Bank insistance, training was made the responsibility of the Department of Public Works, Transport and Communications (DPWTC), although the Government had wanted training to be concentrated under LWUA (PCR, paras. 2.03-2.06 and 3.02). 6. The loan of US$23.0 million to the Government of the Republic of the Philippines was approved and signed in May 1977. US$18.8 million of the loan amount was to be re-lent to LWUA for planni.ig and construction of Provincial water supply systems, while US$4.0 million was to be re-lent to MWSS for sewerage and sanitation planning for the Manila metropolitan area. The balance of US$0.2 million was to be used by the Government, through DPWTC, to finance training of staff in various agencies involved with community water supplies, including LWUA and MWSS. The discussion of the meeting of the Executive Directors when the loan was approved was confined to justification for including the sewerage study for Manila as part of this project and a question about the expected economic rate of return and whether it was comparable with other water supply projects. The Project and its Objectives 7. The project objectives were to: (i) improve living conditions and health standards in six provincial cities by improving their water supply systems; (ii) assist institutional development of LWUA and of the WD in each of the cities; (iii) prepare feasibility studies for 10 additional WDs; (iv) - 3 - update sewerage and sanitation plans for MWSS; and (v) provide training of staff in the several government agencies involved in the water supply sector, especially for small communities (SAR: Loan Agreement; PCR, paras. 1.02 and 2.01). The objectives were spelled out clearly, were appropriate for the sector at that time, were consistent with the objectives of the sector pro- jects financed by other lending agencies, and were apparently accepted by the key government organizations invol,ad in the sec.or. 8. The project was divided into four parts. Part A, to satisfy objec- tive (i), comprised rehabilitation and extension works and other improvements for WDs in Baguio, Cabanatuan, La Union (San Fernando), Lucena-Pagbilao- Tayabas (referred to as Lupata) and Tarlac, all on the island of Luzon. Part B consisted of the feasibility studies for the 10 additional WDs (objective (iii)). The sewerage/sanitation planning for MWSS (objective iv) was Part C, and Part D provided for training of staff from the Government's Department of Health, DPWTC, Department of Local Government and Community Development, and MWSS. LWUA also was expected to benefit somewhat from the training compo- nent, but most of its training needs, and those of the WDs, were expected to meet though its in-house training program which was not part of the project. Thus, the institutional development objectives (ii) were intended to be satisfied only to a limited degree by Part D, but mainly through actions necessary to satisfy the operating and financial performance covenants in the loan documents (SAR; Loan Agreement) and in-house training. LWUA was to be responsible for Parts A and B, MWSS for Part C and DPWTC for Part D. A good broad description of the four parts of the project as planned at the time the loan was approved is given in Annex 1 of the PCR. 9. The project was expected to increase the population served by reli- able and safe community water supply systems from about 150,000 in 1976 (about 30% of the total population in the six project areas) to about 260,0C (about 45%) of the population at the end of 1981 when the project was to be completed (SAR). Installed water production capacity was to be increased from a total of about 59,000 cubic meters per day (cu m/day) to about 115,000 eu m/day, and unaccounted-for water was to be reduced from an average of about 60% of production in 1976 to about 31% in 1982. Nearly 300 km of new pipelines were to be installed and an indeterminate amount of leaking mains were to be repaired or replaced. About 24,000 new service connections were to be made and nearly 9,000 old oneq, replaced (SAR). 10. The project was scheduled to be completed by December 31, 1981 at a total cost of US$38.33 million equivalent (P 287.5 million) including foreign exchange costs, both direct and indirect, of US$19.84 million equivalent, (P148.8 million) or about 52% of the total. Interest and other charges dur- ing construction (IDC) on loans for Part A of the project were estimated to cost an additional US$6.29 million equivalent, including US$3.26 million of such charges on the Bank loan. The Bank loan of US$23.0 million was intended to cover the direct and indirect foreign exchange costs of the project including IDC on the Bank loan for Part A of the project (SAR; PR; Loan Agreement). 11. The expected incremental economic rate of return for the six sub-projects in Part A ranged from about 3% to about 11% and averaged about 8%. The ERR was calculated using incremental water revenues and costs. All costs were in constant (1977) prices, exclusive of duties and taxes. Foreign exchange costs were shadow priced. Revenues were based on expected 1982 tariffs (adjusted for inflation), and the sub-projects were assumed to have a useful life of 40 years. II. PROJECT IMPLEMENTATION AND OUTCOME Start-up and Effectiveness 12. The loan was declared effective on September 9, 1977, four months after it was signed and after only a minor delay in execution of the Government's subsidiary loan agreements with LWUA and MWSS and the Legal Opinion (PCR, para. 3.01; file search). There were no significant start-up problems; delays which occurred came later during the implementation period. Project Revisions and Implementation 13. Because the approved construction component of the project (Part A) was based on preliminary investigations, many revisions were required during the final design and construction phaties as detailed field survey and test tubevell production results became available. None of the changes was out of the ordinary, however. The net results for maJor works were that about 29% more new pipelines were constructed than planned originally, ten pumping stations were built or rehabilitated instead of two as planned, and about 23% fewer tubewells were. drilled or rehabilitated. To keep costs down, a number of non-revenue items were deferred or reduced, such as improvements to operational buildings and purchases of vehicles (PCR, para. 3.05 and Annex 4; file search). Bank staff report that during implementation LWUA made various attempts to revert to some of the original higher deaign standards (para. 4), but that Bank objections and, mainly, the need for cost reductions usually prevailed. 14. Perhaps the most serious deferral of a major work was the rehabilitation of the Santo Thomas Reservoir in Baguio, a large impounding reservoir near the top of Mount Santo Thomas which leaks sc badly that soon after the rainy season, the reservoir becomes empty. The reason for failure to correct this was that LWUA and the Baquio WD decided not to proceed with lining the reservoir because groundwater appeared more readily available. Later, when groundwater supplies were below expectations, the lining for the reservoir was installed, but the reservoir has continued to leak (file search; field interviews). Another change with serious adverse consequences was failure to do enough leak detection and repairs or replacements of deteriorated water meins and service connections (para. 39). - 5 - 15. Project completion was about 18 months later than the appraisal forecast. As of June 30, 1983, the actual completion date, the total number of new service connections added during the project implementation period was about 5% below the appraisal targets, but the number of faulty existing connections which had been replaced was only 14% of what had been scheduled. This shortfall of about 7,500 connections occurred mostly in Baguio which also had a higher rate of unaccounted-for water (58%) than any of the other project cities as of 1982 (SAR; PCR, Annexes 8 and 12). 16. While Part A of the project had generaliy been reduced in scope, Parts B and C were expanded. Part B, feasibility studies for additional WDs, eventually covered a total of 121/ cities instead of 10, and Part C, the sewerage and sanitation studies for MWSS, was extended to include a solid waste management study. Part D of the project - training - was, for all practical purposes, not implemented (PCR, paras. 3.06, 3.07 and 3.12 and Annex 5). 17. In the opinion of the audit, the construction timetable for Part A was realistic and provided sufficient slack to cover contingencies. Never- theless, substantial completion was later than the appraisal forecast, mainly because of a change in procurement methods. When the project was appraised it was undecided whether construction contracts would include the supply and installation of all materials and equipment or whether the supply and civil works functions would be in separate contracts, with LWUA purchasing pipe and fittings, for example, and supplying these to the various cities for install- ation under separately placed civil works contracts. At that time LWUA favored the combined, single responsibility concept and the appraisal time- table was based on this. 18. LWUA then decided, based on the consulting engineer's recommenda- tion, to use separate contracts because this might result in lower costs. After the bid and contract documents were prepared accordingly, LWUA, in spice of objections by the fank, changed its mind on grounds that it was not prepared to handle the additional responsibility and logistical problems which would result from the separate contract system. The bid and contract documents then had to be revised substantially. The usual procurement, con- struction, land acquisition, customs clearance and other implementation pro- blems developed - more or less normally - and there was no opportunity to make up for the lost time (SAR, Annex 1; PCR, paras. 3.08-3.09; file search). 19. The feasibility studies under Part B of the Project were carried out approximately on schedule in spite of the increase number of cities (para. 16; PCR, para 3.10). Part C, the MWSS sewerage and sanitation studies, was completed in June 1980, about one year behind the appraisal 1/ The PCR (para. 3.06 and Annex 5) states that feasibility studies were carried out in two groups for a total of 28 WDs. The second group of 16 was carried out as part of the Second Manila Water Supply Project financed by Loan 1615-PH, however. (Controller's records). - 6 - forecast, mainly because of additional work added to the assignment (para. 16; PCR, para. 3.11; file search). Project Costs 20. The actual project costs are reported to total P297.3 millica (US$33.6 million equivalent at the average exchange rate between US dollars and Philippine pesos used by the Bank in charging local currency disbursements against the loan account over the disbursement period), including interest on loans during construction. These total costs are about 11% below the appraisal estimates when expressed in Philippine pesos and about 25% below the estimates when expressed in US dollars. Summaries of the costs are given in paras. 3.14-3.15 and Annex 6 of the PCR. The construction component of the project (Part A) was completed about 15% below estimates. As the result of the increase in feasibility studies (Part B), costs went up, but substantially nothing was spent on the training component (Part D). 21. The project cost records are not adequate to identify the true foreign exchange costs. If it is assumed that all direct foreign exchange costs were financed from the Bank loan, they totaled only about US$7.34 million, (the rest of the loan was disbursed in local currency) or less than 40% of the appraisal forecast, not including the US$3.08 million which was disbursed against interest and other charges on the Bank loan during construction. Because of the change in procurement procedures, and the resulting amendment in the allocation of the proceeds of the loan (paras. 25-27), however. some of the direct foreign exchange costs were financed indirectly through local currency disbursements, totalling US$11.36 equivalent, against civil works contracts. It is evident, however, that part of the local currency disbursements were for strictly local costs, which was contrary to the original intention (paras. 10 and 25). Funding 22. The comparison of the original financing plan and the final funding of the total project is as follows (SAR; file s arch; PCR, para. 3.14 and Annexes 2, 11, and 12): Original Financing Final Plan Funding Bank loan 52% 65% LWUA Government 35% 32% Six WDs (Internal Cash Generation 8% -- MWSS 5% 3% 100% 100% - 7 - For Part A of the project, it was originally intended that the six WDs would be able to contribute 10% of the cost of the sub-projects from internal cash generation, and Section 4.05 of the Loan Agreement provided for this. The actual financial performances of the WDs, as a whole, did not permit them to make significant contributions to project costs, however. Project Administration and Bank Procedures 23. Disbursements fell progressively behind the appraisal forecasts until after three years they totalled only 30% of what had been expected. This was caused by the slow initial pace of implementation compared to an over optimistic forecast, and because of the change in procurement procedures (para. 18). It was not until FY82 that the rate of disbursements reached the levels that had been expected in FY78 and FY79. By the original closing date (March 31, 1982) two-thirds of the loan had been disbursed, and by the extended closing date (June 30, 1983), nearly 90%. The final disbursement was made on December 7, 1983. In December 1982 and February 1983 a total of US$1.217 million of the loan was cancelled as being surplus (PCR, para. 3.16 and Annex 7; Controller's records). 24. Disbursements did not satisfy the original objectives in two ways; financing of interest during construction (IDC) did not benefit LWUA to the intended extent, and the loan undoubtedly financed much more than the foreign exchange costs. As noted earlier (para. 10) the loan was to finance IDC accrued on or before November 30, 1981 - later amended to November 30, 1982 - on the portion of the Bank loan used for Part A of the project. This was justified in the SAR (para. 3.10) and the President's report (para. 44) on grounds that it would be difficult for the recently established WDs to generate sufficient revenues to service their loans (from LWUA) before the assets financed came into full operation. In fact, Schedule 1, "Withdrawal of the Proceeds of the Loan " was not drawn up in a way to permit distinction between IDC for Part A and other project components, and consequently, withdrawals for IDC on the entire loan were made. The result was that MWSS realized substantial benefits - perhaps as much as LWUA - because until well into the fourth year of the loan, disbursements (other than for IDC) for the MWSS component (Part C) of the project exceeded those for Part A, and by that time disbursements for IDC totalled about US$1.4 million (Controller's records). 25. With respect to local currency financing, US$11.4 million (52%) of the total disbursed amount of the loan (US$21.8 million) was made in local currency. About 83% of the disbursements for civil works, equipment and materials, all for Part A, was made in local currency. Since the loan was intended to cover foreign exchange costs, this implies that only 17% of the costs of civil works, equipment and materials were for local currency costs. It is virtually impossible to produce a co3t estimate for a project of this type in the Philippines which shows that local labor and value aided costs could amount to as little as 17% of total costs, particularly since a sub- stantial portion of the goods used in the project were produced locally. - 8 - 26. The above situation came about because of the way Schedule 1 of the Loan Agreement was amended (see Annex 1), effective November 19, 1981, as a result of the major change in procurement procedures (para. 18). The amount allocated for Category 1, civil works, was increased from US$1.4 million to US$10.0 million and the percent of expenditures to be financed was changed to 75% (previously 15%) of local or 100% of foreign (no change). At the same time, 100% disbursement was allowed for the ex-factory costs of locally manu- factured goods purchased separately, and 65%, for imported but locally pro- cured goods. 27. The bases for the changes is obscure; no supporting calculations are available in the Bank files. But the reason was fairly clear. LWUA was unable to continue financing the new form of civil works contracts under the original disbursement formulas and th imendment was designed to utilize the balance of the loan funds and re a LWUA's problem without particular regard to the foreign exchange fin ag objective. The audit has concluded that the change served the basic oijectives of the project and that without it the project probably would have been further delayed considerably, or perhaps only partially completed. In the process, however, the intention to cover foreign exchange costs only was abandoned (file search). 28. In addition to the mid-stream change in procedures, procurement was hampered by lengthy contract award approval requirements imposed by LWUA's Board and the Government. As the project went on, however, and after consi- derable urging by the Bank, the approval processes were streamlined some- what. Other than the above, no notable procurement issues arvse between the Bank and LWUA during the implementation period. There was, however, a very heated and vocal issue which developed between LWUA and one of the cities (Lucena of the Lupata WD) over the type and quality of the distribution pipe which LWUA had specified. This was eventually settled, without visible intervention by the Bank, but the disagreement delayed that sub-project for several months (file search). 29. Accounting, auditing and other reporting requirements by the Bank were generally fulfilled satisfactorily, although with some delays (PCR, para 3.19 and Annex 2; file search). The individual WDs, while able to carry out conventional accounting procedures, had difficulty with the more sophisticat- ed procedures required to calculate financial rates of return on revalued net fixed assets in operation, however. This problem eventually led to a revi- sion of the revenue covenant from a rate of return requirement to a cash generation requirement which was expected to be easier for the WDs to under- stand and for LWUA to enforce. 30. Total Bank staff time charged to project supervision averaged about 11 staff weeks per year over the six-and-one half year implementation period and missions were at average intervals of about 8.5 months (Basic Data Sheet and Time Recording System). During the critical last three active years of the implementation period, however, Bank staff supervision activity fell off to an average of only about 6 staff weeks per year. In the opinion of the audit, these levels of supervision activity were below normal, particularly - 9 - since LWUA was a new borrower, this was a multi-city project, and the mission trips usually also included assignments on four to seven other projects in two to four countries (file search). 31. Considering the rather limited alloc.ation of Bank Staff time to supervision, the results were generally good, which reflects favorably on the quality of the work and the advantages of maintaining a good degree of staff continuity. More staff resource allocation would have permitted more visits to the six cities; the records show that these were limited because of the need to concentrate on discussions with LWUA in Manila. There might have been an earlier and more insistent effort by the Bank to get action on the serious problem of unaccounted-for water. The PCR states the opinion (para. 8.01), and the audit agrees, that more supervision attention should have been focused on financial and institutional issues, suggesting, for example, that more support to LWUA c- tariff reviews might have helped with the WDs atti- tudes and efforts to raise rates. Similarly, more could have been done to get some action on and results from DPWTC's training program, although the possibility of much success was rather remote.2! Management and Institutional Development 32. When the project was appraised, LWUA was a young institution (para. 2). Yet, its organization was based on sound planning which proved to be basically well-suited for the Philipp'nes. It was a development authority with politically popular objectives and a large measure of independence, the whole country in which to operate and ample scope for innovation and ex- perimentation. Not surprisingly, it grew quickly under vigorous leadership and with young, bright, though inexperienced, staff attracted to the organization by its growth potential and the appeal of its mission. Technical and financial support from bilateral and multilateral agencies (para. 3) definitely boosted its prestige. 33. In its growth during the course of this project, LWUA had some political and technical lessons to learn, sometimes painfully. It had to deal with matters which could be extremely sensitive in local politics and which challenged vested interests--water supply, the concept of financially viable WDs, and the independence of local governments. In its eathusiasm, LWUA stepped on toes. As a result of complaints from one WD (not part of the Bank-financed project), the Government suspended LWUA's operations for one month (August/September 1978) and this prompted a self-evaluation. There were two main conclusions: (a) projects had to be Fized to the economic capacity of the cormunity; and (b) the community had to be informed about the project and its objectives, involved in its planning, and made aware of the 2/ DPWTC undt-,went a major reorganization and restaffing and although a high level decision was made to prepare a work program, no one took the lead. Also, there was limited need for foreign exchange for local training and government restrictions subsequently allowed only grant funds, which were available, for overseas training. - 10 - contributions expected from it. LWUA applied these lessons reasonably well although there were slips now and then when, in its urgency, it tended to be overly ambitious and high-handed (PCR, paras. 9.02-9.03; file search). 34. Bank staff rated LWUA's management of the project in the early years as weak. Much of the early delay could have been avoided by good project management. At times, LWUA appeared to have little control, or even knowledge, of the activities of its consultants. In its early rapid growth stage, departments evolved in a rather independent manner, without adequate coordination and inter-action. Even,.ually, a qualified project manager took over and project implementation improved considerably. A corporate planning unit was established in the later years which had a beneficial effect on planning and operations (file search). In spite of the problems, however, Bank staff rate LWUA's implementation performance as satisfactory (PCR, para. 9.03). The audit agrees. Any comparisons between expectations and actual performance on institutional development and project administration should take into consideration the fact that the expectations of the Bank (and LWJA) were undoubted too optimistic. 35. Good examples of over optimism were the expectations as to financial performances of the WDs and, therefore, LWUA (PCR, paras. 5.01-5.06). LWUA was a fledgling development agency and, obviously, had large up-front development expenses which could be recovered from the WDs only over extended periods of time. In the meantime, LWUA had to rely on loans or Government grants and contributions. The major risks to LWUA were that the WDs would not make their payments on time (which, in turn, depended on the WD's raising their rates as required and improving their efficiencies, as by reducing unaccounted-for water) and that the Government's financial participation would not keep up with demand. Furthermore, if LWUA established WDs at too fast a rate, the gap between up-front expenses and income could exceed the provisions for filling that gap. And finally, it was assumed that LWUA's operating expenses would be kept under control during its period of rapid growth, a virtual impossibility during the rapid growth phase of a public institution. 36. Most of these risks were identified during appraisal and noted in the SAR, but no information was presented as to the consequences. In fact, all the risks were realized to some degree (PCR, paras. 5.01-5.06). The rate of establishing WDs exceeded estimates. Many WDs could not make their pay- ments to LWUA in full and on time, including three of the six WDs included in this project, and a few had to be taken over to be managed by LWUA, including Lupata, which was part of the Bank Project. Operating expenses got out-of- hand and LWUA's collection efficiency was unacceptably low. But in spite of repeated previous representations by the Bank, it was not until about mid- 1982 that LWUA started to make serious efforts to resolve cash flow pro- blems. And finally, under severe budget constraints faced by the Government, the priority of LWUA's program was downgraded and equity contributions were reduced by two-thirds beginning in 1983 (PCR, para. 5.03; file search; field interviews). - 11 - 37. LWUA officers and staff have stated that they consider that the project's influence on the organization was beneficial. The managers of the individual WDs which benefited from the project are unanimous in stating that the Water District approach was the only way to improve the water supply systems in the cities and, therefore, that the project was beneficial to the local institutions. A WD performance evaluation and rating system, estab- lished by LWUA, is challenging, and this, along with the reporting require- ments by the Bank, while not necessarily popular, imposed a discipline which two of the six WDs admitted was necessary. Project Results and Impact 38. Information on the physical components completed under Part A of the project compared to the original plan is summarized in PPAM paras. 13-15 and described in detail in Annex 4 of the PCR. While lengths and numbers are known, data on increases in actual water production and distribution capacity are deficient. Available data (PCR, annexes 8 and 11) do indicate, however, that at the end of 1982, when the principal project components were substan- tially completed, actual water production rates were high enough to demonst- rate that production capacity objectives in each of the six cities probably had been reached. In some cases the increased capacity was not reached in the expected way. The Lipa WD, for example, had the initiative to rediscover and rehabilitate old tubewells, constructed during World War II but later abandoned for unknown reasons. 39. The actual water production figures, other than indicating capa- city, are nothing to applaud, because more than half the water produced (53% in 1982) is classified as "unbilled" or unaccounted-for water. While the figures probably are not accurate because of metering problems, they do indi- cate the magnitude of the problem. Between 1977 and 1982, the increase in the total volume of water sold per year in all six cities was about 4.0 million cu.m. Over the same period, there was an increase of about 1.9 million cu.m. in water produced for which no revenue was obtained. Some of the WDs manag2d modest improvements in reduction of unbilled water, but this was very late in the construction period and almost insignificant compared to the target for reducing unbilled water to 30% of production (PCR, para. 4.02 and Annexes 9 and 12). The reason for this poor performance was the decision by each WD to defer detection uf leaks and illegal connections and corrective action until the new works were coiupleted. Considering that water production costs per cu.m. were increasing at 'he rate of about 15%/year, and that the WDs were having extreme diffic . meeting their financial performance objectives, such decisions were untuccunate indeed. Although the loss reduc- tion problem was discussed with LWUA by supervision missions from time-to- time, it was not until the project was nearing completion that unaccounted- for water was taken up as a serious issue in written communications between the Bank and LWUA (file search). 40. No effort was made by LWUA or Bank staff to determine the popula- tion which gained access to water service as a result of the project, as compared to the original expectations (110,000 people, para. 9), and such an - 12 - exercise is beyond the scope of the audit. The best available clue is the reported number of new water service connections (about 22,400) which was 95% of the objective and indicates that the target for additional population served was substantially met. 41. The actual social and economic benefits of the improved and extend- ed water supply service provided by the project are not considered to be measurable in monetary terms (PCR, para. 7.01). As is usual for such proj- ects, it is taken as self-evident that an adequate supply of safe water is essential, and that investments on community water supply have a satisfactory economic value provided that due consideration has been given to affordabil- ity, least-cost solutions and priorities. The audit is satisfied that these conditions have been met adequately on this project. Although the PCR contends that there were elements of over-design in the various sub-projects, the audit was unable to identify concrete examples of this and questions that conclusion. As far as planning and design are concerned, the audit's princi- pal criticism is about under-design, namely the lack of specific action programs - rather than targets only - to reduce unbilled water. 42. As a proxy for measuring the economic value of the project as completed, the incremental economic rate of return for the six sub-projects has been recalculated using actual project costs and incremental net reve- nues, all deflated to 1977 constant prices. The results range from a nega- tive return (Lipa) to a healthy ERR of about 12% (Tarlac) with a mean for the six WDs of about 6%. The appraisal estimate for the group was about 8% (PCR, para. 7.02 and Annex 15). Sustainability 43. To sustain and possibly enhance the benefits ibtained through this project, it is absolutely essential that each WD pursue an aggressive action program to reduce unbilled water. Detection and actiona against illegal con- nections, in particular, is fussy but relatively inexpensive work and can pay very good dividends. Along with this, periodic tariff adjustments are required to reach acceptable financial performance standards and thus make it possible to expand service to new customers. 44. Sustainability of LWUA's development as an institution and of its program to assist with improvement of water supply service in additional communities depends in part on the financial viability of the WDs all over the country. But because of its inherent cash flow problems as a development institution (para. 35), LWUA will be even more dependent for a number of years on the Government for its local counterpart funds. Under the severe budget constraints which have existed for the last few years, LWUA and its development program have been virtually stalled. While it is probable that LWUA grew too rapidly and that it was time to take stock and consolidate its position, there is the danger that total lack of growth will cause the institution to lose momentum. Its staff could lose the enthusiasm and dedication demonstrated in its earlier years and some might leave, taking with them the benefits of the experience and lessons learned. In fact, there - 13 - already are indications of loss of these institutional benefits. Given the reality of the budget problem it appears critical, therefore, that LWUA'S turn toward concentration on maximizing the efficiency and effectiveness of existing WDs be given the same degree of importance and sense of challenge and accomplishment as was devoted earlier to establishing new WD9 and carrying out new projects. In this connection, the PCR recommendations for improved performance (PCR, para. 6.08) are appropriate. III. FINDINGS AND ISSUES Overview 45. In the opinion of the audit, this was one of the better planned and executed multi-city water supply projects carried out with Bank financial assistance. There were shortcomings, however, in that the expectations for the expansion of LWUA's operations were too optimistic both in terms of quantity and quality. Similarly, the forecasts of development of the WDs into financially viable service agencies were unrealistic. And finally, there was a serious lapse in planning by not concentrating early enough on specific actions to make better use of existing resources by attacking the causes of the large amounts of unbilled water. 46. The audit considers that the amount of Bank staff resources allo- cated for supervision, particularly during the final three years, was below normal. Nevertheless, the results were generally good, reflecting well on quality and a good degree of staff continuity. 47. The audit found no evidence to support the conclusion expressed in the PCR that there was significant over-design in the physical components of Part A of the project as carried out (PCR, paras. 6.05-9.02). Most of the project consisted of relatively small-scale components and the audit con- siders that there would have been relatively little savings in first costs by changing the design period from 8 to 5 years. 48. On balance, ani especially considering the recent establishment of LWUA, implementation of Parts A and B of the project was good. MWSS's conduct of Part C went reasonably well and resulting in a follow-on Manila Sewerage and Sanitation Project (Loan 1814-PH) on which progress is satisfac- tory. Part D of the project, training, was a failure. Virtually nothing was accomplished. Training carried out by LWUA's Training Services unit, and not financed from the loan, but needed to support Part A of the project, was infinitely more successful (PCR, 6.07; field interviews). It is evident from this that the Bank's insistence on DPWTC as the implementing agency for Part D (para. 5) was a mistake. Lessons 49. The only lesson emerging from this project experience that is worth particular attention is that pertaining to unbilled water. Not that this is - 14 - unique; unfortunately, lack of progress in reducing unbilled water has been a characteristic of many other water supply projects. The main reason for flagging the problem here is that it is a glaring example of unlearned lessons of the past. The lesson, pure and simple, is that reduction of unbilled water cannot be given a secondary priority. It is not something to be done later when the new works are operational, and it requires planning and design of a specific action program just as early and just as urgently as the project elements intended to increase production and distribution capacity. - 15 - INDE(AL CITIES MIEl WM19 (~N 1415-EO A11eti of Proceds of LMsn Schule 1 of 1~un Aersn (05/13/77) 1w nt oe 11/19/81 Ao~ne of LMa AllocatedI(b- % Of Zof Final o ich p in US$ E~pendi mr.es h~truamnt l mmns.equiwlent) to be Pman åmt to be Finn~ 12/07/83 0 (1) Civil ~rks 1.4 12 of local 10.0 72 of local or 10,257,2 8,439,900 eienditurm or 100% of forei (82.3) 100g of forei (2) fquian and 7.9 2.5 2,177,219 1,817,20 umtrtals (82.1) (a) directly 100% of forei No chng (b) localy lm of local imfactured expenditures ab dhang (c) imorted htt 61 locally ib hu pr=cre (3) C~nsultants' 6.0 10(& of foreign 6.0 No chng 6,247,534 1,106,300 services Osrantu~e (17.7%) (a) der Parts A and B of the Project (b) uder Part C of the Project (4) Training 0.2 100% of forei 0.2 No dng 18,047 0 (5) Interet and 3.3 unts due 3.3 am~ ue 3,083,136 0 Other charges or befor. mitheIcan Idm er 30, accrued or 1982 before Nmber 30, 1981 (6) n1located 4.2 1.0 1iAL 23.0 23.0 21,783,136 11,363,400 -•• ••- (52.1%) -en11-2 1,216,864 12/2/82 1UA, 23,4,000 - 16 - PROJECT COMPLETION REPORT PHILIPPINES - PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PU) I. INTRODUCTION 1.01 Although th! Philippines is endowed with abundant water resources, public investment in the water supply sector has traditionally been very low, with the result that the infrastructure for water supply and sanitation is inadequate throughout the country. Prior to this loan, most of the small amount of public investment in the sector had been in the Metropolitan Manila Area (MMA), so that the situation in provincial cities and smaller communities had become acute. At the time of appraisal, it was estimated that less than one-half of the country's urban population outside Manila had access to safe water supply. 1.02 The Project's main goal was to assist the Government in implementing its policy of improving water supply services in the provincial population centers of the country. The principal component of the project consisted of improving and expanding the water supply services and facilities of six Water Districts covering the following provincial cities all on the main island of Luzon: B. io, Cabanatuan, Lipa, Lucena-Pagbilao-Tayabas (Lupata), San Fernando ( TT!ion) and Tarlac. (See attached Map). The Sector 1.03 The Provincial Cities Water Supply Project was the second Bank ope- ration in the Philippine water supply sector. The only previous Bank opera- tion in the sector was a loan to the National Waterworks and Sewerage Authority (NAWASA) in 1964 to expand and improve the water supply system serving Manila for which project execution was slow and the financial cove- nants were not observed. In the early 1970s, with guidance from USAID, the Government made substantial progress in organizing the sector, dissolving NAWASA and creating the Metropolitan Waterworks and Sewerage System (MWSS), responsible for water supply and sewerage in the MMA, and the Local Water Uti- lities Administration (LWUA) for the provincial cities, the latter being defined as municipalities having population greater than 20,000. In 1980 the Government established the Rural Waterworks Development Corporation (RWDC) for water supply development in the rural areas. The reorganization of the water sector was concomitant with the Government's adoption of an ambitious long- term Master Plan for development of water supplies in the provincial popu-- lation centers of the country. The organization of the sector is appropriate at this stage of development; however, a review is needed to revise the Master Plan in line with the absorptive capacity of the sector and implementation capacity of the institutions. 1.04 Early loans to LWUA included: (i) USAID funding of $34.0 million (1974-77) for feasibility studies, engineering design with consulting services, construction and immediate improvements of water supply projects in about 66 provincial WDs; (ii) an Asian Development Bank (ADB) loan of $16.8 million (1975) for water supply projects in 5 WDs; and (iii) a loan of $2.3 million (1974) by the Danish International Development Agency for the improve- ment of water supply in two other WDs. The Bank-assisted Provincial Cities Water Supply project constituted another part of the first stage of the long- range plan and also funded feasibility studies for future projects. - 17 - The Borrower and Executing Agency 1.05 The Government of the Philippines (GOP) was the Borrower of the Loan. The Government was covenanted to relend, on the same terms as those of the Bank loan, $18.8 million to LWUA to finance the foreign exchange costs of improving the water supply systems of the six WDs (Part A of the project) and feasibility studies and design work for improving water supply systems in about 10 other WDs (Part B of the project). The Government was also to relend $4.0 million to MWSS, on the same terms as the Bank loan, to finance the for- eign exchange costs of review and design studies for a sewerage and sanitation improvement program for the MMA (Part C of the project). The Government was to use the balance of $200,000 to finance training for the staff of Government agencies engaged in water supply operations and management for provincial and small rural communities. The Department of Public Works, Transportation and Communication (DPWTC) was responsible for organizing the training program (Part D of the project). 1.06 LWUA, the principal executing agency for the project, was estab- lished as an independent Government corporation by Presidential Decree 198 in 1973. The decree states that the provision of reliable and economically viable water supply and sanitation systems in provincial centers is a matter of high national priority, it authorizes the formation of local WDs to provide these services and authorizes LWUA to execute and administer the policy by assisting in the formation and development of technically and financially sound locally-controlled WDs through loans, technical assistance, and training. LWUA is also responsible for establishing and enforcing standards of water quality and service. While LWUA has been active in the development of water supply systems, it has not carried out any sanitation improvements (para. 6.08). II. PROJECT PREPARATION AND APPRAISAL Preappraisal and Appraisal 2.01 The project originated from a request by the Government of the Philippines to the Bank to help finance water supply projects for various pro- vincial cities. The primary objective of the project was to provide improved water supplies by carrying out rehabilitation and construction works in six WDs and assisting in the development of efficient public utility organizations for these WDs. A description of the project components is presented in Annex 1. 2.02 The project was prepared by LWUA with the assistance of consultants financed by USAID. This resulted in a proposed project that was designed to U.S. standards. A Bank mission reviewed the consultants' work in April 1976 and determined that the project was overdesigned. After overcoming initial resistance from LWUA, the project as appraised by the Bank in September 1976 reflected lower oesign standards than those originally proposed by the ccasul- tants (para. 9.02). - 18 - 2.03 Four other significant issues arose during project preparation. The first of these concerned the institutional capability of LWUA, which had been in existence for about four years at the time of appraisal. It was the Government's intention that the feasibility studies and appraisals of sub- projects to be financed from the loan be principally carried out by LWUA staff. Because of the relative inexperience of LWUA staff, the loan as negotiated provided for consultants to advise LWUA in project design and construction. 2.04 A second issue concerned water rates. The Presidential Decree establishing LWUA required WDs to set rates and charges for water adequate to cover operating expenses and debt service as well as to provide a reasonable surplus for investment in the improvement and expansion of the system. The decree empowered the WDs to prescribe and revise the rates from time to time and vested in LWUA the power to review the rates in order to ensure compliance with the above provisions. Three areas of concern were discussed during appraisal. Firstly, LWUA's guidelines for the determination of water rates by the WDs then included declining block tariffs VLich encouraged excessive and potentially wasteful water usage by larger consumers. A second problem was that the existing rates did not contain adequate provisions for the financing of future investment. It was agreed that LWUA would review the existing guidelines and would, in consultation with the Bank, formulate revised guidelines for the WDs. Finally, appropriate tariff levels needed to be set in each WD. The existing rates were very low and needed to be increased substantially to make the WDs financially viable; each of the six WDs had operating deficitp in 1976. Rate increases in the six WDs were made a condition of negotiations (para. 2.07). 2.05 The third issue concerned the Bank's requirement that the WDs contribute 10% of project costs from internal sources during project construc- tion. LWUA objected to this requirement on the grounds that it was financially and politically unfeasible to extract resources from existing consumers in the WDs to finance project improvements and extensions primarily benefiting future consumers. The Bank was of the view that the WDs should attempt to make a contribution towards the capital cost of the project. Therefore, the loan as negotiated included a 10% equity contribution covenant (paras. 3.02, 3.03). 2.06 The fourth issue concerned the nature of the training component of the project. The Bank initially intended that the funds be used for a joint Department of Health (DOH)/Bureau of Public Works (BPW) training program to develop staff capabilities in water supply to small provincial and rural small community. GOP foresaw considerable difficulty in inter-agency coordination and in securing the release of DOH engineers from their assigned tasks in order for them to play a greater role in water and sanitation develc,ment. Instead, GOP recommended that training be concentrated under LWUA as part of LWUA's national mandate. The Bank felt that LWUA should focus on fulfilling its main role of Water District formation and support. At negotiations it was agreed that training would be the responsibility of the Department of Public Works, Transportation and Communication (DPWTC), but its scope would be ealarged to cover not only BPW and DOH staff, but also those from MWSS, LWUA and any other agencies active in the sector. - 19 - Negotiations 2.07 Negotiations with representatives of the National Economic and Development Authority (NEDA), NWSS, and LWUA were held in Washington in March 1977 after assurances were sought andjeceived that tariff increases were in effect or forthcoming in the six WDs.- Agreements reached during the discussion concerned: (a) LWUA's terms for lending to Water Districts; and (b) administration of the staff training program by DPWTC (para. 2.06). III. PROJECT IMPLEMENTATION Effectiveness and Covenants 3.01 The original date of effectiveness was to be August 12, 1977. Effectiveness was conditional on execution of the subsidiary Loan Agreements between GOP and LWUA and GOP and MWSS. Delays in the receipt of the subsi- diary Loan Agreements and of GOP's legal opinion on the Loan Agreement caused the deadline to be extended to September 15, 1977. On September 9, 1977, the Loan was declared effective. 3.02 A complete description of covenants and compliance therewith is at Annex 2. In general, most of the covenants were met. In addition to the standard requirements for insurance, approval of consultants' reports, and audit of accounts, the Loan and Project Agreements contained a number of covenants designed to protect the financial viability of the WDs. The most significant of these required LWUA to: (a) oversee an annual review of water rates by the WDs and to cause the WDs to implement the findings of such reviews in a timely manner (section 4.07); (b) cause the WDs to set tariffs at the level necessary to produce an annual rate of return on the value of its net fixed assets in operation as follows: in FY82, not less than 6%; in FY83, not less than 7%; and from FY84 on, not less than 8% (section 4.06); and (c) cause the WDs to contribute in cash from internal sources 10% of capital expenditures for tae project during construction (section 4.05). 3.03 The three covenants listed above were not fully met. Covenanted rate reviews met with considerable delays and were not carried out annually as required. Without the findings of the rate reviews, LWUA's leverage in enforcing appropriate tariff levels was seriously weakened. If instead LWUA, 1/. Tariff increases in five WDs went into effect by April 1, 1977. The sixth WD, Baguio, reclassified a number of commercial consumers which raised revenues by the same amount as the proposed tariff increase. - 20 - with Bank support, had focused on WD financial viability, it might have been able to help the WDs achieve the necessary tariff increases. At the time of appraisal it was expected that rate increases would be implemented as needed since the tariff levels were affordable relative to household income criteria. Moreover, the WDs had authority to set rates and LWUA had the power to review rates and ensure compliance with the financial performance require- ments. In practice, LWUA could not enforce the requirements; in fact, in 1978, public outcry against tariff increases resulted in a temporary suspen- sion of LWUA's operations and culminated in GOP's issuance of two Letters of Instruction (LO1 700 and 744) which limited rate increases to 60% at a time, and provided for public hearings and approval of project design in advance of tariff increases. The public hearings introduced considerable lags into the process of rate adjustments, thus keeping tariffs below the level required to maintain WD financial viability. Consequently, none of the WDs was able to meet the covenanted contribution to project costs. Recognizing the inadequacy and sensitivity of tariff levels, neither LWUA nor the Bank forced the issue of reduction of the contribution arrears. Annex 3 presents a history of tariff levels for the six WDs, comparing the actual average rate per cu m with the rates proposed in the appraisal report. 3.04 In addition to the unexpected problems created by inadequate tariff adjustments, the WDs experienced other difficulties in meeting the cove- nants. The rate-of-return covenant presented a problem, for it required the application of relatively sophisticated accounting techniques for the revaluation of assets which were beyond the scope of WD staff. As mentioned above, the requirement for WDs to pay 10% of project costs over the period of construction placed a heavy burden on the newly formed and financially weak WDs (para. 2.05). When the follow-up project, Provincial Cities Water Supply II (Loan 1710-PH/Credit 920-PH), was negotiated in 1979 it included a covenant requiring a 10% contribution by the WDs, but provided an incentive in that again it would be matched in the smaller WDs by a 20% Government equity contribution. LWUA did not consider this subsidy to be necessary for the larger WDs which had a stronger economic base. The covenant on Loan 1710- PH/Credit 920-PU has since been modified to accept from the WDs whatever equity contribution is possible, including contribution in kind. Very recently, the rate-of-return covenant has also been reviewed by LWUA and Bank staff who have agreed that a cash generation covenant is preferable because it is easily understood, administered, and meets financial viability criteria. Steps have been taken to amend the follow-up project documents to reflect this change. Project Revisions 3.05 Annex 4 describes project revisions for the six WDs whose water supply system extensions were financed under Part A of the Loan. Most of the variation from the appraisal report is due to: (i) hydraulic redesign neces- sitated by actual versus expected well yields; (ii) pipeline extensions to meet expected demand; (iii) deferral of leak detection/repair program until construction was completed (para. 4.02); and (iv) other measures aimed to reduce project costs, such as the deletion of non-revenue generating items. As compared with appraisal estimates total project costs for Part A were reduced by 16%. - 21 - 3.06 Part B, feasibility and design studies for 10 provincial cities, was expanded to cover a total of 28 provincial WDs. The project areas are listed in Annex 5. 3.07 Part C, financing of feasibility studies and design for a sewerage and sanitation improvement program in MMA was expanded to include a study on Solid Wastes management. Implementation Schedule 3.08 The scheduled project completion date was December 31, 1981. The physical components (Part A) were substantially completed during 1983, about 1-1/2 years later than anticipated at appraisal. Contract preparation, bidding and approval took longer than expected, in part due to the change in procurement method to the "single responsibility" concept of bidding whereby the civil works contractor is also responsible for the supply and delivery of material. Thif change introduced delays because the bid documents had already been prepared assuming separate works and supply contracts. LWUA requested the change after acknowledging that they anticipated being unable to effectively manage the logistical responsibility of materials storage and delivery implied by separate materials and works contracts; the Bank eventually agreed to the change after recognizing the validity of LWUA's rationale. This approach was replicated in the follow-up project. 3.09 Project construction also met with some delays. In addition to normal construction delays, the contractors were hindered by: delays in drilling production wells giving satisfactory yields; delays iu land acquisi- t!on, permits, letters of credit, customs clearance; design changes requested by the WDs, delays in electric power service; and unavailability or poor quality of materials. Other delays in project construction were attributable to poor management on the part of the contractors (para. 3.17). 3.10 The water supply feasibility studies on Part B were carried out according to schedule. Under the project, funding was also made available to finance feasibility studies for additional project areas. The follow-up project, Provincial Cities Water Supply II: Loan 1710-PH/Credit 920-PH was based In part on these studies. 3.11 On Part C, the expanded scope of the study resulted in an extension of the completion date for this component to January 1983. The sanitation studies led to another Bank project, Manila Sewerage and Sanitation: Loan 1814-PH, appraised in 1979. 3.12 Part D, training, was not implemented to the degree expected at appraisal. The appraisal report did not specify a schedule for training; however, the consultant executed three brief training missions, spending only $18,000 of the $200,000 allocated. This reflected a weak role by DPWTC in coordinating the training component. The Bank communicated to DPWTC on several occasions that more training was required, but it was not under- taken. Later, as LWUA's and the WDs' own training programs were developed with funding from other sources, this component became less crucial (para. 6.07, 6.11). - 22 - Procurement 3.13 The Borrower procured all Bank-financed goods and services through international competitive bidding (ICB) procedures in accordance with Bank Guidelines. As noted above, LWUA adopted a combined supply and works concept of bidding (para. 3.08). However, no foreign firms participated in the bidding. Small contracts, with an estimated total cost of $1.2 million and urgently required off-the-shelf items for rehabilitation works costing less than $10,000, and not exceeding $200,000 in aggregate were awarded on the basis of local competitive bidding acceptable to the Bank or on quotations from at least three potential suppliers. Costs and Disbursements 3.14 A detailed comparison of total project cost as estimated at appraisal and upon completion is presented at Annex 6. These costs can be summarized as follows: TOTAL COST (P million) % Actual to Appraisal Actual appraisal PART A - Water Supply Construction 274.51 230.82 84 PART B - Water Supply Feasibility Studies 11.22 21.37 190 PART C - Manila Sewerage and other Studies 47.47 44.92 95 PART D - Training 1.50 0.14 9 Total Costs 334.70 297.25 89 3.15 Due to changes in the project, appraised and actual total project costs are not directly comparable. In Part A, decreases in project cost were due primarily deferral of leak detection and repairs, and reductions in vehicle and building outlays (para. 3.05). Part B costs reflect the expanded scope of work (para. 3.06). Part C costs were below appraised estimates despite expanded scope of work (para. 3.07). Part D costs reflect under- spending on the training component (para. 3.12). 3.16 A schedule comparing cumulative estimated and actual disbursements is presented in Annex 7. Due to initial slow implementation (para. 3.08, 3.09), disbursements were made far behind schedule. At appraisal it was expected that 95% of loan proceeds would be disbursed by the end of FY81 based on the assumption that bulk purchase of equipment would be made in the early years; actual cumulative disbursements that year were only 37% of the expected level. The final disbursement was made on December 7, 1983, two years later than anticipated. - 23 - Performance of Consultants and Contractors 3.17 Part A: Consultant performance was satisfactory. All studies/works were completed in accordance with agreed schedules. Contractors generally completed all works in conformance with requirements and corrected all defects which arose after the systems were tested. In one case, a contractor refused to complete work schedule? inder his contract; LWUA arranged for the Army Engineering Brigade to complete work within original contracted price. As noted above, construction progressed more slowly than anticipated for many valid reasons sometimes beyond the contractors' control (para. 3.09). In many of the WDs, however, additional delays were attributable to the poor manage- ment practices and weak financial positions of the contractors, 3ymptoms of which included financial problems, and inadequate manpower and construction equipment. LWUA intervened in a number of situations where problems with con- tractors arose. A common remedy by LWUA was to recommend a change of project construction manager. 3.1v Part B, C and D: Consultant performance was satisfactory. The feasibility studies under Part B, the Metro Manila Sewerage Master Plan and the Solid Waste Master Plan under Part C were completed within the agreed schedule. The training consultant on Part D carried out his assignments as required. Reporting 3.19 The Project Agreement contained standard Bank provisions for audit and progress reporting by LWUA and the WDs. It also required LWUA to regular- ly prepare and submit various financial and operational performance reports including information on WD performance. In general, LWUA's and the WDs' reporting requirements, other than reports on rate reviews were met. However, LWUA's reports were sometimes late due to late receipt of inputs from the WDs. Throughout the project, the Bank made several requests for improved quality and timeliness of LWUA reports and audits. IV. OPERATING PERFORMANCE 4.01 Because of implementation delays, water production, connections and sales in each successive year were substantially telow the projections made at appraisal. However, by the end of 1982 when construction was substantially completed in the WDs, all were producing water at levels higher than antici- pated at appraisal. On the other hand, distribution fell short of expecta- tions; the total number of connections and volume of sales for 1982 were 86% - 24 - and 75%, respectively, of appraisal estimates. Annex 8 presents initial, actual 1982 and expected 1982 production, connection and sales volume levels for the six WDs. The number of connections in Baguio and Lipa in 1982 exceeded expectations, although 1982 sales were below appraisal estimates. The number of connections and sales in 1982 were below estimated levels in the other WDs for a variety of reasons including that houses were not plumbed and pre-existing shallow wells were still operational. An analysis of household income and billing statistics by the WDs confirmed3 hat water tariffs are affordable to all but the very poorest households. However, connection fees are relatively expensive, requiring an investment of as much as P 600 or 50- 60% of average monthly family income in a typical WD. All of the WDs are now engaged in marketing programs designed to encourage consumers to connect. While features of the advertising campaigns vary, most stress readily avail- able and affordable safe water, cost savings as compared with privately operated wells, attractive terms for financing the costs of connection, and subsidized connection charges. 4.02 Unaccounted-for water was not reduced to expected levels during project implementation. Annex 9 documents actual and expected levels of unaccounted-for water for 1982. In 1982, unaccounted-for water averaged nearly 50% in the six WDs, as compared with appraisal estimates averaging about 30%. The project contained two features to reduce system losses. First, as a by-product of new distribution networks, illegal connections would lose access to free water along those parts of the old distribution networks which would be disbanded. Second, and more importantly, it was intended that under the project all WDs would undertake leak detection surveys and subsequently replace leaking service connections, pipes, faulty hydrants, and water meters. However, the WDs felt that it was preferable to defer compre- hensive leak detection and repair until the new transmission and distribution systems were installed and fully pressurized. In fact, improvement works were undertaken to a limited degree during project implementation by only four of the six WDs (para. 3.05). All six WDs, with LWUA's assistance, are now taking steps to reduce unaccounted-for water. 4.03 The new water supply systems have experienced a few technical performance deficiencies most of which were associated with pumps. In turn, most pump problems have been related to power fluctuations and failures; generating sets are being acquired by the WDs to remedy the latter problem. A few WDs encountered problems due to the inferior quality of some locally manufactured gate valves and water meters. In response, LWUA established quality control procedures for materials and equipment. Feedback and assistance were also given to suppliers to improve the production quality of materials and equipment. 3/ The very poorest households obtain small quantities of water from vendors and unprotected sources. - 25 - V. .INANCIAL PERFORANCE LWUA's Finances 5.01 The table belov compares LWUA's projected financial performance for the 1977-1981 period as per the SAR with the actual performance during the same period. Detail is provided in Annex 10. LWUA INCOME STATEMENT 1977-1981 (Pesos million) SAR Actual Revenue Interest from WDs 265 148 Interest on investments 23 56 Total Revenue 288 204 Expenditures Operations 52 107 Interest 81 44 Depreciation 6 3 Total Expenditure 139 154 Net Operating Income 149 50 Less 7axes 0 17 Net Income 149 33 5.02 Actual net income of P 33 million was far less than the projected F 149 million. The main reasons for this are: (1) lower interest earnings from WDs because of a reduced lending program (SAR lending program estimate of P 942 million compared with actual of P 720 million) due to the delay in project implementation, (2) higher operations costs primarily because of sub- stantially increased labor costs (which appears to be in line with wage infla- tion in other public utilities), and (3) the requirement for LWUA to pay taxes which was not anticipated at the time of appraisal. LWUA did however stay well within the covenanted maximum debt-equity ratio of 3:1, with an actual ratio of 1:1.6 (Debt of P 368 million compared with equity of P 601 million) (P.A. 4.08(b)). It was also able to meet its debt servicing requirements during 1977-1981. 5.03 LWUA's current and projected financial performance is poor. From 1983 onwards the grace period on a number of loans will have passed and repay- ment of loans by LWUA to the Government should commence. This combined with - 26 - the higher than projected operations costs and the lower collections from WDs, resulting from currently difficult economic conditions (para. 5.06), means that LWUA will be unable to fully service its loans. For example, LWUA's Corporate Plan for 1984-1987 shows that based on past performance it will be able to meet only 50% of its average debt servicing requirement of P 80 mil- lion per annum. As LWUA carries the foreign exchange risks on its foreign loans, its debt servicing requirement would increase proportionately with any further deterioration in the value of the Peso. LWUA's financial difficulties are also partially due to a mismatch between its short term borrowing from the Government with loan repayments over 2 ,years and its lending terms to WDs which require repayment over 30 years.- To improve its earnings LWUA has recently increased the interest rates to WDs on existing and future loans to a spread with a higher rate payable on larger loans. It is unlikely that WDs can absorb this additional cost at present. Also, LWUA is totally dependent on the Government for local counterpart funds to finance its continuing devel- opment program. Under the current severe budget constraints faced by Govern- ment, the LWUA program has been accorded a low priority with a considerable scaling down of its investment program, e.g, from government equity contribu- tions of about P 150 million for 1981 to less than P 50 million each for 1983 and 1984. The reduced level of Government allocations of counterpart funds is adversely affecting the implementation of the follow-up project (Loan 1710/Credit 920). Unless adequate local counterpart funds are provided ana collection efficiency improves, LWUA will not be able to support a viable development program; under those circumstances LWUA would also be unable to recover all capitalized expenditures covering feasibility studies and other establishment expenses. An agreement has been reached with LWUA for the engagement of a consultant to review LWUA's financial performance, the financial provisions in its Charter, its financial policies and practices and make recommendations to improve its future financial viability. The proposed study has NEDA's support. Water District Finances 5.04 The WDs' financial performance varied substantially. Baguio, Lupata and La Union performed reasonably well considering the delays in project implementation. Cabanatuan, Lipa and Tarlac performed substantially below appraisal estimates. The WDs which performed well generally have a stronger economic base ensuring a large number of connections and/or high volume consumers, e.g., Baguio with 11,000 and Lupata with 8,000 connections, respec- tively, and La Union with food processing plants and harbor facilities. Con- versely, the WDs with a poor financial performance have fewer connections ranging from 3,300 in Cabanatuan to about 1,500 in Tarlac. Detailed financial statements comparing SAR estimates with actual performance for all WDs com- bined and individually are given in Annexes 11 and 12, respectively. 4/ Government loans to LWUA are made on the same terms and conditions as the Bank loans to the Government. Loans by LWUA to the WDs are for periods equal to the estimated project life. - 27 - 5.05 As project implementation was delayed by about 1-1/2 years, the comparison of actual performance with SAR projections includes actual results up to and including 1982. On this basis consolidated revenue of about P 76 million is 38% below appraisal estimate, operating costs at P 65 million are 20% below estimate and consequently net operating income of P 10 million is 35% below the appraisal estimate of P 16 million. Apart from the economiec of scale referred to in paragraph 5.04 above, the lower level of financial performance can be attributed to a number of factors. Firstly, the delay in project implementation delayed the full income-earning potential in the WDs. Secondly, as the majority of WDs continued the use of old distribution net- works, unaccounted-for water losses remained relatively high at an average of about 50% during 1982. Finally, while most operating cost components were lower in line with lower water production levels, the cost of labor was 50% higher than the appraisal estimate. 5.06 Water Districts as autonomous and financially viable public utilities is a relatively new concept to the Philippines. It appears that the time and effort needed to reach these objectives was underestimated. Many WDs experience financial difficulties and some are unable to repay their loans on time. All of the WD's do, however, have considerable scope to improve their financial performance in time. Firstly, nearly all WDs have reserve capacity in source and distribution workE allowing the opportunity to provide more service connections and sell more water in the future with relatively little increase in capital or operating costs. Secondly, now that systems have become fully operational, water leak detection and reduction programs are being implemented. Finally, as experience is gained and staff is trained further, it can be expected that WDs will become more efficient in operational and financial management. The average economic internal rate of return at about 6% shows that the long term prospects are reasonably satisfactory; however, it should be noted that substantial differences exist in the performance of the individual WDs (para. 7.02). VI. INSTITUTIONAL FERFORMANCE AND DEVELOPMENT LWUA 6.01 One of the project's main goals was the development of LWUA as an organization capable of providing direct institutional, technical, and finan- cial assistance to WDs. LWUA's organizational structure was designed to meet WD needs. LWUA's current organizational structure is similar to that in effect at the time of appraisal. The most important organizational change since project initiation was the creation of the Corporate Planning Group in 1982; its function is to assist LWUA management in decision-making, through the formulation of corporate plans and strategies. Five principal services are provided by LWUA: regulatory, engineering, financial, administrative and training. Regulatory Services is responsible for forming, organizing and supervising water districts. Engineering Services undertakes feasibility studies, and supervises design and construction management. Financial Services is responsible for loan operations and financial management. Administrative Services performs the general administrative functions. - 28 - Training Services provides technical and management training to WD and LWUA personnel. There is still scope for improved coordination between these functional units. LWUA's 1982 organization chart is at Annex 13. 6.02 At the time of appraisal LWUA was just beginning to carry out its mission of forming and supporting water districts. The table below summarizes LWUA's increasing level of performance during the early part of the project implementation period. PERFORMANCE OF LWUA (For the Individual Years as Shown) Activity 1976 1978 1980 No. No. No. Water Districts formed 18 24 49 Feasibility studies completed 11 13 21 Designs completed 2 10 13 Construction completed - 4 5 Well drilling completed 18 17 18 Staff members 239 422 593 ----------(P million)---------- Loan Disbursements by LWUA 56 110 154 These statistics reflect that during project implementation there was great pressure on LWUA to quickly expand goals and services. The agency grew very rapidly with emphasis on the formation of new districts and subsequent lending and construction programs. During this rapid growth period, some of the WD assistance concepts received relatively less attention. The level and quality of technical support to the WDs was generally fair, but LWUA successfully assisted the WDs in management audits, and introduction of commercial practices systems. LWUA's role could have been much better with regard to rate reviews (para. 3.03), revaluation of assets (para. 3.04), and assistance with start up of WD operations. Now that LWUA's construction activities have been scaled down, it is making a concerted attempt to improve the operations, and hence financial viability, of the WDs. LWUA has reassigned staff and recruited consultants to assist WDs with operations, leak detection and financial management. 6.03 Project implementation could have benefitted from more aggressive project management by LWUA. LWUA's performance during project implementation reflected relative inexperience in contracting, project supervision and initial technical manpower shortages. LWUA's inexperience manifested itself in a number of ways. As an example, they experienced difficulties in the preparation and evaluation of procurement bids (para. 3.08). It is possible - 29 - that LWUA could have facilitated land acquisition and the obtaining of permits and rights-of-way by applying pressure at the local government level. Closer supervision of consultants and contractors by LWUA might also have been use- ful, particularly in the early years of the project when local consultants were employed as project resident engineers. These problems were substan- tially corrected over the project implementation period as in-house staff have gained experience and confidence in contract management and construction supervision. 6.04 The Appraisal Report identified LWUA's and the WDs' inexperience as a potential project risk and highlighted the need for institutional strength- ening through the development of LWUA's internal staff capabilities. Though the project was designed to help achieve this objective through considerable management consulting support and training and Bank supervision, the appraisal report acknowledged that its achievement would require intensive efforts by LWUA and the consultants. Given the uncertainties regarding LWUA's ability to quickly and efficiently fulfill its role of improving the operational status of the WDs, the project's implementation schedule formulated in light of concurrent USAID and ADB projects (para. 1.04) must be regarded as overly ambitious. The slower pace of actual implementation allowed for LWUA's and the WDs' institutional learning curves and manpower development; under the circumstances, the pace of actual project implementation was reasonable. 6.05 The water supply components were based on feasibility studies prepared in advance of the project. The standards of service delivery embodied in these components reflect LWUA's early optimism regarding WD viability. In retrospect, it is clear that lower design criteria and greater phasing of projects to meet fewer years' future demand would have eased the financial burden on the WDs. 6.06 During the project, the Bank sought a stronger role by LWUA in WD institutional development. The Bank's view of LWUA as a water supply sector financial intermediary was somewhat divergent from LWUA's self-image as pri- marily an engineering organization. Consequently the two institutions some- times perceived problems and solutions differently. On balance, however, LWUA's overall performance and develoment as an implementing agency on the project was satisfactory. 6.07 Over the course of the project and since the recent slowdown in program expansion, LWUA has recognized the need to consolidate and strengthen its program of support to all WDs. Fortunately, LWUA is now staffed with seasoned professionals who can fulfill this role. LWUA currently performs in- depth market surveys during feasibility studies to scale projects to the economic capability of the community. LWUA has strengthened its advisory services to the WDs including provisions for (a) adding a LWUA member to the WD Board of Directors or (b) takeover control of WDs if necessary. It is iow advising the WDs on marketing strategies and assisting in leak detection pro- grams. LWUA also offers a program of mini-loans to help WDs undertake imme- diate improvement works quickly. During 1983, LWUA's training program provi- ded technical and management training to about 1,000 WD participants. - 30 - 6.08 Three areas are highlighted for improving LWUA's performance. Firstly, increased practical training in engineering, management, finance and operations needs to be made available to the WDs. Secondly, LWUA must concen- trate more on fulfilling its role as a water supply sector financial institu- tion; for this purpose LWUA must make better use of its Corporate Planning and Financial Services staff. Lastly, while LWUA under its charter is empowered to provide sanitation improvements in WDs, apart from a few feasibility stu- dies for water-borne systems, none have been provided. LWUA should consider promoting lower cost sanitation technology. Water Districts 6.09 Water Districts are independent public corporations entrusted with the development and operation of local water supply systems to provide safe and adequate water to the residents within their respective service areas. Financial viability is a basic requirement for WDs. The Presidential Decree of 1973 authorized the formation of Water Districts on a local option basis by a resolution of the municipality or other local authority. Once a Water District is formed, the local authority ceases to have jurisdiction over it and the WD can be dissolved only by a resolution of its Board of Directors. The Board is comprised of 5 members, representing various public interest groups, who are appointed by the mayor or governor from amongst the nomina- tions made by the public interest groups. Formulation of policy is the func- tion of the Board; its implementation is the responsibility of the General Manager, who is appointed by the Board. To guard against political influence no public official may serve as a Director in a WD. Nonetheless, the WDs are still subject to political pressure; this became clear after the public outcry and government reaction regarding water tariffs (para. 3.03). An organization chart of a typical WD is shown in Annex 14. 6.10 All the six WDs covered by the Project ar7 properly organized and staffed according to the guidelines given by LWUA*5 During project implementation, the WDs were generally successful at running their opera- tions. As described above, however, they met with great resistance to tariff increases. Most WDs need to hold numerous rate request hearings and obtain LWUA's active support before negotiated increases are finally granted. There- fore, they have all experienced gaps between required and actual tariff levels. The situation is now easing somewhat as public acceptance of the viability concept increases. Unfortunately, a history of subsidized tariffs, high unaccounted-for water and rising costs have generated financial woes for 5/ LWUA monitors the performance of all WDs on a regular basis using institutional performance indicators. Each WD is compared with similar size and type of water district by using indicators such as personnel cost to total cost and number of connections per employee. Of the six project WDs, all but Lipa received a "poor" rating on the most recent review, due to their inability to meet on time their debt-service to LWUA. - 31 - the WDs. As of December 1983, only Lips was current on its equity contribu- tion payments to LWUA; in the worst case, payments by Tarlac were 42 months in arrears. 6.11 On the brighter side, many of these WDs have become cornerstones in their respective regional association of WDs, where the older and more exper- ienced WDs both help out new WDs informally, and through formal training programs. In 1983, the regional training centers run by these associations trained about 900 participants in water supply management, finance and oper- ations. These programs are highly regarded by the smaller WDs. VII. ECONOMIC RE-EVALUATION 7.01 The social and economic benefits envisaged in the feasibility studies on which the project was based included: improvements in public health, convenience and satisfaction of the consumers, enhancement of employ- ment, increased fire protection, increased value of land, and overall strengthening of the sector. These benefits were not quantifiable in monetary terms, but it was generally accepted that such benefits did accrue from the implementation of the project. At appraisal the economic internal rates of return (EIRR) for the six WDs were ci culated using water revenues as a minimal measure of project benefits*- as shown in the appraisal report, the calculated EIRR averaged about 8.2% for the project WDs. This was considered acceptable in light of the unquantifiable benefits flowing from the project. 7.02 The ex post calculation of the rate of return is detailed in Annex 15. This calculation resulted in an EIRR averaging about 6.0% for the six WDs, as compared with the appraisal average estimate of 8.2%. The lower average EIRR is explained mainly by: (i) reduced and delayed project revenues due to lower incremental sales volumes and lower tariffs, and; (ii) higher than expected incremental operating costs. VIII. BANK'S PERFORMANCE 8.01 The Bank undertook 9 supervision missions during the implementation of the project. The Bank monitored the progress of works through the various progress reports submitted by LWUA, the WDs, and the consultants, as well as through the reports of the supervision missions. At various points, the supervision missions flagged problems with procurement, disbursements, consultants and training. In each case, the Bank intervened and directed LWUA's attention to actions that would improve project implementation. It appears that better interaction between the Bank and LWUA and more focussed 6/ The use of revenues underestimates project benefits by ignoring consumer surplus as well as health and environmental benefits. - 32 - attention on financial and institutional issues would have aided project execution. For example: (i) more active involvement by the Bank in providing analytical support to rate reviews may have had a salutory effect on the WDs' attempts in raising tariffs and hence improve their ability to repay loans; (ii) greater specificity by the Bank on the terms of reference for DPWTC training program might have enhanced this part of the project (para. 3.12); and (iii) more specific financial performance requirements for LWUA might have focussed its attention on its role as a financial intermediary and hence on solutions to potential financial difficulties. 8.02 The original implementation schedule was not met. The disparity between the operating results forecast at appraisal and those achieved reflect unfulfilled expectations of the speed with which the project would be imple- mented and the rate at which connections could be provided and water sales increased. In retrospect, the five-year schedule appears to have been opti- mistic. However, the actual disbursement period of 6 1/2 years compares well with the 8-1/2 year disbursement profile for this sector in the East Asia Region. 8.03 Financial results under the project varied from appraisal estimates; the project appraisal expected regular and significant tariff increases but these failed to materialize. As noted above, the financial covenants were not met. In particular, the requirement that the WDs to contribute 10% of capital costs during construction proved to be unattainable; therefore, neither LWUA nor the Bank could enforce it. LWUA's reservations on this covenant (para. 2.05) were based on the belief that the project would strain the weak WD institutional and financial resources. Perhaps the Bank should have given consideration to other alternatives at the time of appraisal. 8.04 To a large extent many aspects of this project were improved in the follow-up project, Provincial Cities Water Supply II: Loan 1710-Credit 920. Main improvements in the second project were: (i) reduction in project scale from meeting 8 years' future demand down to 5 years; (ii) stronger incentives for the smaller WDs to meet the 10% contribution requirement by offering a matching 20% Government grant; (iii) phasing of feasibility studies to allow progressive implementation of projects; (iv) improved document approval procedures to reduce administrative delays. IX. CONCLUSIONS 9.01 The primary objective of the project was to provide improved water supplies by carrying out rehabilitation and construction works in six WDs and assisting in the development of efficient public utility organizations for these WDs. 9.02 The expected financial viability of the WDs has not yet materialized. It is useful to examine the project experience to understand the factors contributing to thia result. Such an examination points to overdesign of the physical components of the project as the central impediment to WD fiscal health; in retrospect, it is apparent that standards of service - 33 - delivery were too high and project scale was too large even after being reduced by Bank staff during the appraisal of the project (para. 2.01). The overdesign of the physical components had direct financial ramifications. Foremost, it required nigher tariffs then would be otherwise necessary. Secondly, it also implied that the 10% contribution to capital costs by the WDs was higher in absolute level than it would have been for a project with lower standaids. As noted above, tariffs and the 10% contribution to costs were problematic for the WDs on this project. The lesson to be learned is that projects must be designed and scaled to tl-e economic capacity of the communities involved. 9.03 LWUA learned this and other lessons during project implementation, maturing from a fledging institution to a stable organization capable of designing and overseeing the construction of water supply projects throughout the country. At the time of appraisal, it was expected that LWUA's maturation would occur relatively quickly and steadily. Optimism regarding LWUA's development was reflected in the planned project implementation schedule. Even though the project met with a delay of 1 1/2 years, progress was reasonable given LWUA's state of development. Overall, LWUA's implementation performance was satisfactory although a strnnger role in WD institutional development and financial management would have been desirable. 9.04 The Provincial Cities Water Supply Project achieved its main objec- tives. It increased supplies of safe, affordable water in six WDs; prepared studies for improvements in 28 additional WDs; and prepared sewerage, sanita- tion and solid waste studies for Manila. It helped promote public awareness for the need to conserve and pay for water. Institutional development under the project was good and improved over the course of the project as WD and LWUA staff gained experience in all areas of water supply development and management which would indefinitely benefit the water supply sector in the Philippines. 9.05 To a small extent, the project also financed the training of water supply technical staff; however, in terms of expected impact, this small training component was a failure. Fortunately, LWUA's training program, for LWUA and WD staff financed with their own and bilateral funding, quite successfully achieved training in the water supply sector. Moreoever, the follow-up project included a major training component of $570,000 which more than made up for the earlier shortfall and greatly strengthened LWUA's training activities. 9.06 The six WDs continue Uo seek improved financial and operational per- formance by adjusting tariffs, reducing unaccounted-for water and increasing the number of connections and hence water sales and revenues. These efforts will have a continued positive impact on the system performance in the six WDs. Other WDs will indirectly benefit from this project as the lessons learned are applied by LWUA and the Eank in the implementation of the Second Provincial Cities Water Supply Project. ANNEX 1 -34 - Page 1 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Project Description A. 'later Supply for Six Water Districts. This component expanded the water supply program in the six water districts of Baguio, Cabanatuan, Lipa, Lupata, La Union and Tarlac. The project financed drilling of deep wells, construction of transmission and distribution facilities, installation of new service connections, metering, lead detection and improvement of existing facilities in the six WDs. In addition, the project funded in each WD: water meters, hydrants, and chlorination equipment; vehicles for operation and maintenance; and office accommodations, meter shops, laboratories, and stores with required equipment. Engineering consulting services were provided to develop detailed designs and assist in the supervision of construction. B. Feasibility Studies for Water Supply Improvements. This component involved the preparation of feasibility studies, with the assistance of consultants, for projects to improve the water supply systems in ten WDs, selected by LWUA in consultation with the Bank. C. Manila Sewerage Studies. Funding was provided for review and design studies for a first stage sanitation improvement program for the MMA. D. Staff Training. The project provided for the services of an engineer and equipment for the training of staff of the Department of Public Works, Transportation and Communication, the Department of Health, the Department of Local Goverment, LWUA, MWSS and other government agencies engaged in designing and constructing water supply projects in small communities. ANNEX 2 . -35 - Page 1 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Compliance with Covenants Section of pro- ject agreement Covenant Status of compliance 2.05 & 3.03 Insurance coverage. All required coverage was obtained. 2.06 Documentation to be forwarded to Bank. Met. 2.08 Acquisition of land and land rights All sites were acquired. WDs. 2.09 Progress reporting by LWUA. Met. 4.01 (b) LWUA and WDs to implement commercial Implementation completed. accounting procedures not later than January 1, 1978. 4.02 Regular preparation and audit of WD Met. financial statements. 4.03 Audited WD balance sheets regularly Met. submitted to Bank. 4.04 WDs to establish realistic value of Realistic value received in their assets not later than December 1978. Current update of 31, 1977 and thereafter maintain assets records to be examined records of the assets. in review report of WDs audit. - 36 -ANNEX 2 - 36 - Page 2 Section of pro- ject agreement Covenant Condition of compliance 4.05 WDs to finance 10% of project cost Not met. from internal cash generation during 1977-81. For each year of 1978, 1979 and 1980, such generation to be at least equal to 9% of Project Loan at the end of the preceding year (for San Fernando-La Union WD, for 1980 this percentage would be 5%). LWUA to submit to the Bank by March 31 each year a cash flow analysis for the previous and the current year to show the results of applying this test* 4.06 Each WD to set tariffs at the level Not met. necessary to produce an annual rate of return on the value of its net fixed assets in operation as follows: in FY82, at least 6%; in FY83, at least 7%; from FY84 on, at least 8%. 4.07 (a) LWUA's guidelines for setting rates to Reviewed in 1978. be reviewed by June 30, 1978. 4.07 (b) Annual review of rates by October 1, Not carried out to degree each year. intended. In 1984 LWUA is carrying out these studies for the 6 project WDs as well as other WDs. 4.08 (b) Maximum debt-equity ratio for LWUA of Met. 3:1 - 37 - ANNEX 3 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT History of Water Tariffs Average Water Rate per Cubic Meter (Actual/Appraisal Estimate) % actual to appraisal WD 1977 1978 1979 1980 1981 1982 (1982) Baguio 1.48/1.70 1.48/1.70 1.48/1.70 1.64/2.00 1.90/2.00 2.04/2.80 72 Cabanatuan 0.74/0.80 0.83/0.80 1.03/1.00 1.29/1.50 1.39/1.50 1.88/2.30 82 Lipa 0.84/0.70 0.88/0.70 1.05/1.40 1.35/1.60 1.35/1.60 1.71/2.60 66 Lupata 0.30/0.50 0.34/0.50 0.50/0.80 0.67/1.20 0.67/1.20 0.67/2.30 30 La Union 1.23/1.00 1.21/1.00 1.74/1.80 1.73/1.80 2.44/1.80 2.60/3.30 79 Tarlac 1.30/1.20 1.36/1.20 1.66/1.60 2.08/1.60 2.57/1.60 2.75/2.20 125 - 38 - ANNEX 4 Page 1 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Revisions to Winter Supply Components Project Elements of Baguio (variation from Appraisal Report) Elements Appraisal Design Implemented Spring sources. Rehab Buyog Spring. Rehab existing open Rehabilitated. sump and construct 8 cu m RC spring box Chamber at Buyog. Well sources with Drill 4. Drill 7. Modifica- Drill 7. Construc- pump sets and chlo- tion and reconstruc- ted two (2) pump- rinators. tion of the exis ing houses; Installed pump houses and . - 16 booster pumps and placement of exis- 2 submersible deep- ting pumps. well pumps. Storage tank. Rehab Sto. Tomas Rehab Sto. Tomas Deferred. reservoir. Reservoir. Rehab km 8 tank. Rehab km 8 Deferred. reservoir. Construct two (2) Construct seven (7) Constructed five (5) new tanks @ 3,785 capacities varying capacities varying cu m each. from 190 to 3,800 from 190 to 3,800 cu m. cu m. - Transfer 4 exist. Deferred. steel tanks to new location. New pipelines. 118.5 km (100 mm 0 101 km (100 mm 0 to 99 km (100 mm 0 to to 500 mm 0) 500 mm 0). 500 mm 0). Rehab 5.3 km from Deferred. 8 km. Service connections Replace 7,500 leak- - Deferred. ing service connec- tions, 80 faulty hydrants and 100 in- operative meters. Install 10,000 new 7,000 new units. units. Operational building Administrative Deferred. building, shop building ANNEX 4 Page 2 Project Elements of Cabanatuan (variation from Appraisal Report) Elements Appraisal Design Implemented Well sources with Drill 7. Drill 7. Five pumping sta- pumpsets and tions rehabilitated. chlorinator. Rehab 2 existing - wells. Storage. Two (2) @ 1,200 cu m Two (2) @ 1,360 cu m Two (2) @ 1,360 cu m each or two (2) new each. each. wells. New pipelines incl. 46 km (100 mm 0 to 71.3 km (100 mm 0 to 65.7 km (100 mm 0 to valves, fittings and 250 mm 0). 300 mm 0). 300 mm 0). Ia hydrants. Service connections Metering all exis- 100%. (s.c.). ting connections. Replace 600 leaking Replaced. s.c. Install new Install 4,024 units 5,300 units. /b new 5,940 units. Operational bldg. Administrative bldg. Administration bldg. - Plumbing/meter Plumbing/meter repair shop incl. repair shop inclu- repair facilities, ding repair facili- ties. Vehicles Two vehicles for Two vehicles for One vehicle pur- operation and operation and chased. maintenance maintenance /a 1.6 km of 200 mm 0 pipe was installed by WD. T7- Installation being undertaken by the Water District. This item was deleted from the contract of C & A. Also included here are dual service connections (as of 28 February 1983). - 40-. ANNEX 4 Page 3 Project Elements of Lipa (variation from Appraisal Report) Elements Appraisal Design Implemented Well sources with Drill 6 wells. Drill 6. Drill 6. /c pump & chlorinators. Rehab. 2 existing All existing wells wells. to be abandoned were retained. Storage tank. Rehab. existing. Rehabilitated. /a 300 cu m reservoir. 300 cu m new reser- voir. Additional two (2) Additional one (1) sumps (150 cu m and sump (200 cu m) with 200 Cu m) with booster pumphouse. booster pumphouse each). New Pipeline with 28.2 km (100 mm to 35.5 km (100 mm to 29.3 km (100 mm to valve fitting. 200 mm 0). 250 mm 0). 250 mm 0). Service connections. Metering of all ser- 100%. vice connection. Replace 200 leaking Replaced. service pipe. Install new 2,050 Install about Installed 2,500 ser- service connection. 2,000 service con- vice connection. /b nection. Operational bldg. Administrative bldg. Administrative bldg. Plumbing/meter repair shop and laboratory. Store and pipe yard. Two vehicles for operation mainte- nance. Vehicles. Two vehicles for Two units. One unit. operation and main- tenance. /a Well development done by well drilling contractors. /b Done by WD. 7~ 1,574 units installed by contractors, others. ANNEX 4 - 41- Page 4 Project Elements of Lupata (variation from Appraisal Report) Elements Appraisal Design Implemented Spring sources. Improved/expand the Construct access Construction of R.C. existing May-it road, diversion diversion canal and Spring intake and canal, intake intake chamber. minor improvements chamber, motor to other existing chlorinator house at spring intakes incl. May-it Spring. Chlorination equip- ment. Storage tank. Two storage tanks Two (2) R.C. reser- Two (2) R.C. ground (500 cu m and voir (300 cu m and reservoir 700 cu m capacity) 4,2500 cu m) demoli- (4,250 cu m at Covering of existing tion of existing Tongko and 300 cu m Tongko tanks. Tongko reservoir, if at Pagbilao). necessary. New pipelines with 54.8 km (100 mm 0 to 79 km (100 mm 0 to 79.9 km (100 mm 0 to valves, fittings 700 mm 0). 600 mm 0). 600 mm 0). hydrants. Service connections. Meter all existing services and replace leaking service pipes. Install new Install new 100% completed. /a 3,050 units. 4,000 units. Operational bldg. Administrative bldg. Administrative bldg. plumbing/shop bldg. plumbing/shop and and laboratory. laboratory. Vehicle. Two vehicles for Two vehicles for One (1) vehicle for operation and main- operation and main- operation and main- tenance. tenance. tenance. /a Done by WD. ANNEX 4 -42 - Page 5 Project Element for La Union (variations from Appraisal Report) Elements Appraisal Design Implemented Well sources with 6 infiltration 6 infiltration wells 2 infiltration pumpsets add chlori- wells. 6 pumphouses. wells. /a nators. 3 shallow wells. /b 3 pumphouses. Storage. 3 R.C. reservoirs 2 R.C. reservoirs (250, j50 and (700 cu m at San 700 cu m capacities. Fernando and 250 cu m (Bacutan). New pipelines incl. 34.1 km (100 mm 0 to 38.3 km (100 mm 0 to 39.4 km (100 mm 0 to valves fittings and 350 mm 0). 300 mm 0). 300 mm 0). hydrants. Service connection. Replace 200 100% completed. /b existing. Provide new Provide new 100% completed. /b 1,500 units with 1,000 units. meters. Operational bldg. Administrative Administrative Rehabilitation of building. building. the existing Admi- nistration building. Plumbing and meter Plumbing and meter shop with store and shop with store and pipeyard. pipeyard. Vehicles. Two vehicles for Two vehicles for One vehicle for ope- operations and main- operations and main- rations. tenance. tenance. /a Done by well drilling contractors. /b Done by WD. ANNEX 4 - 43 Page 6 Project Elements of Tarlac (variation from Appraisal Report) Elements Appraisal Design Implemented Well sources with Drill 4. Drill 4. Drill 4. pumpsets and chlori- nators. Rehab 2 existing Rehabilitated wells. 2 wells. Storage tanks. Additional 2,100 cu Additional Additional m and 600 cu m or 1,500 cu m and 1,500 cu m and two (2) new wells. 520 cu m. 520 cu m. Key pipelines inclu- 34.4 km (100 mm to 62 km (100 mm 63 km (100 mm to ding valves, fitting 450 mm 0). 400 mm 0). 400 mm 0). and hydrants. Service connection. Metering of existing 100% completed. service connections. Replace 200 existing Replace 200 existing service connections. service connections. Provision of 2,500 new service 2,000 new service 4,900 new service connections. connections. /a connections. Operational bldg. Administrative bldg. Administration bldg. Plumbing/meter Plumbing/meter shop repair shop and and laboratory. laboratory. Vehicles. Two vehicles for Two vehicles for One vehicle for ope- operation and main- operation and main- ration and mainte- tenance. tenance. nance. /a 1,500 units done by the Contractor, the rest by the WD. 44- ANNEX 5 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Feasibility Study Project Areas First Group 1. San Jose (N.E.) 7. Pagadian 2. Orani, lataan 8. North Cotabato 3. Guagua 9. Lingayen 4. Dumaguete 10. San Carlos 5. La Carlota 11. Iloilo 6. Vigan 12. San Jose (M.O.) Second Group 1. Tuguegarao, Cagayan 9. Ilagan, Isabela 2. Dasmarinas, Cavite 10. Sipocot, Cau. Sur 3. Passi, Iloilo 11. Gumaca, Quezon 4. Dingle-Pototan 12. Naguilian, La Union 5. Donsol, Sorsogon 13. Loon, Bohol 6. Balayan, Batangas 14. Pilar, Capiz 7. Talibon, Bohol 15. Catbalogan, Samar 8. Sta. Cruz, Marinduque 16. Odiongan, Romblon S45 - ANNEX 6 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Project Cost - Actual and Appraisal Estimate (P million) Appraisal estimate % actual Local Foreign Total Actual /a to appraisal Part A - Water supply construction WDs: Baguio 21.15 23.85 45.00 69.63 Cabanatuan 26.89 16.96 43.86 36.45 Lipa 10.33 9.87 20.22 18.96 Lupata 23.40 28.49 51.89 46.56 La Union 16.42 14.38 30.80 25.56 Tarlac 18.58 16.99 35.57 33.66 Interest during construction (IDC) 22.73 24.45 47.18 /b Subtotal 139.51 135.00 274.51 230.82 84 Part B - Feasibility studies 4.62 6.60 11.22 21.37 190 Part C - Manila sewerage studies 17.32 30.15 47.47 44.92 95 Part D - Training - 1.50 1.50 0.14 9 Total 161.45 173.25 334.70 297.25 /a Breakdown of local and foreign costs not available. 7b- IDC included in actual costs under Part A. Note: Totals may reflect rounding errors. ANNEX 7 - 46 - PHILIPPINES PROVINCIAL CITIES WATER SUFPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Cumulative Estimated and Actual Disbursements (US$ million) Year: FY78 FY79 FY80 FY81 FY82 FY83 FY84 Estimated 4.18 11.38 17.54 21.83 23.00 23.00 23.00 Actual 1.13 3.58 5.21 8.06 16.27 19.68 21.78/a % of actual to estimated 27 31 30 37 71 86 95 /a US$ 1.72 million cancelled December, 1982. ANNEX 8 - 47 -* PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Water Production. Sales and Connections Actual Before Projected Actual projected Water District project 1982 1982 (%) Production (cu a/day) Baguio 10,000 19,178 26,000 La Union 3,950 5,780 4,700 Tarlac 2,300 9,397 13,000 Cabanatuan 5,780 12,000 26,000 Lipa 2,110 4,301 10,000 Lupata 20,149 15,342 30,000 Total 44,289 65,998 109,700 166 Sales (million cu m) Baguio 3.08 4.90 4.32 La Union 0.51 1.52 1.02 Tarlac 0.24 2.44 0.86 Cabanatuan 1.37 2.96 1.70 Lipa 0.39 1.11 0.90 Lupata 2.76 3.64 3.64 Total 8.35 16.57 12.44 75 Connections (no.) Baguio .7,450 11,830 12,570 La Union 1,056 2,450 2,263 Tarlac 777 5,900 2,220 Cabanatuan 2,539 6,800 5,278 Lipa 940 3,000 4,000 Lupata 5,120 8,850 6,880 Total 17,882 38,b2) 33,211 86 ANNEX 9 - 48 - PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Unaccounted-for Water (%) Before WD project (1976) Projected (1982) Actual (1982) Baguio 60 30 58 La Union 60 27 53 Tarlac 50 29 J5 Cabanatuan 53 32 43 Lipa 65 30 48 Lupata 64 35 53 Reg i s iii ii il s ' l l l å El ik! ÉIi1 51211 -1111 1 icM111 - U, il PC in EYii .0 "JU. 4 "c CXMM ~ . - -> Z<.C 9 4WU .C4 * x sE ..., m c..¤. ärs*.* ä- u >9 ,se- Mu aB . .- en CP404 0. - -ss 6eea ns e.. eif. .5a -- -* e- 1 -..-69 - 0T 1l1' 1 P H I L I P P I N E 5 I S T PROVINC IAL W ATER SUPP LY P 0 JECT ALL WDS COMBINED Z 1977-1982 FA6UiO CABANAN LPA LU-PA-TA LA UNION TARLAC TOTAL BAGUIO CABA#A'W LIPA LU-PA-TA LA UNION TARLAC TOTAL - - - S T A F F A P P R A4I S A L - - - - - > - - - - A C T U A L P E R F 0 R N A N C E- - - > WATE& PROLuCEi 000 Cd.n 41730 1Q590 7310 32010 9630 11490 121760 49003 15257 6957 43698 7296 3212 125423 14TEF SOLlt 00 CU.M 24050 11970 4360 18160 5850 7670 72060 22353 8386 3263 18617 4217 1927 58763 dNDILLED WATE 42 39 40 43 39 33 41 55 45 55 55 43 37 53 CONNECTIO#S NO. 11830 6800 3000 8850 2450 5900 38830 12570 3366 4000 6880 2263 2220 31299 INCOftE STATEMENTZ , PESOS 000'S ( PESOS 000'S ) EVENUES: SALES OF WATER ;NET, 48920 17810 7210 20770 11710 13380 119800 37114 8613 4175 9954 8149 3965 71970 OTHER OPERATIONAL REVENUE 660 230 80 220 23C 120 1540 1744 365 246 1174 238 40 3807 --- ---------------- -- - ---- --~--------------------- ---------- ------------------ --- TOTAL 0EEATING REVENUE 49580 18040 7290 20990 11940 1300 121340 38858 8978 4421 11128 8387 4005 75777 t^ 0 EXFENDITURES; i WAGE: 7000 2410 820 3290 1610 1250 16380 10800 4550 1433 4492 2729 2000 26004 CHEMIHALS 470 220 90 380 110 160 1430 711 57 58 503 98 17 1444 POWER 19260 1430 360 770 2 , 1510 23620 10972 1821 1095 954 210 736 15788 MATERIALS 3450 830 390 1400 800 650 7520 2048 650 151 1948 972 545 6314 OTHER DIRECT EXPENSES 1210 550 80 300 500 140 2780 4722 813 574 283 78 0 6470 INDIRECT EXPENSES 2440 890 350 1040 580 680 5980 0 0 32 0 0 0 32 DEPRECIATION 4230 3780 2010 6630 4260 2940 23850 5128 1166 710 901 642 363 8910 --- -------- ~---- ---- ~ ------ --- --- ---- -- - --- - ----------- - ---------------- --- - TOTAL OPERATING EkPENPItURE 38060 10110 4100 13810 8150 7330 81560 34381 9057 4053 9081 4729 3661 649,.2 ------------------------------ ------------------------------------------ ~---------------- NET OPERATING INCOME 11520 7930 3190 '180 3790 6170 39780 4477 -79 368 2047 3658 344 1081't aTHEF EXPENITUPES. INTEREST 5110 4450 2060 5320 3220 3580 23740 745 111 0 15 823 90 1784 NON-OPERAING 0 0 0 0 0 0 0 -1503 0 -27 -262 0 0 -1792 MISCELLANEOUz 0 0 0 '0 0 0 70 487 0 19 0 0 0 506 -- --- --------------------------------------- - ------~---------- - --- ----------- -- --- --------- 'LTAL OTNEP Ei^ENDITJRES 5110 4450 2060 5390 3220 3580 23810 -271 111 -8 -247 823 90 498 -ET--- ----------------------------- - 4 3- --------------------------------------------- MET IKCOME b410 3480 1130 1790 570 2590 15970 4748 -190 376 2294 2835 254 10317 P H I L 1 I P 1 0 E S F R 0S PR VINCIAL WATER SUPPLY PR 0 JECT ALL UDS COMBINED : 1977-1982 BAGUIO CABANA N LIPA LU-PA-TA LA UNION TARLAC TOTAL BAGUIO CABANA'N LIPA LU-PA-TA LA UNION TARLAC TOTAL - STAFF APPRAISAL - - - - - - - . ----- ACTUAL PERF 0 RMANCE - - - CASH FLOW STATEMENTS PESOS O00'S ( PESOS 000'S SOURCES: OPERATING SURPLUS 15770 11720 5220 13770 8060 9120 63660 9605 1083 1078 3208 4300 707 19981 GRANT- FO,g OPERATIONS 1140 0 0 640 320 0 2100 0 0 0 0 0 0 0 INTEREST 0 0 0 '1 -70 0 -70 0 0 0 0 0 0 0 MISCELLANEOUS 0 940 0 0 0 0 940 -1518 -19 10 0 16 -15 -169:' INTERNAL CASH GENERATION 16910 12660 5220 14410 8310 9120 66630 8087 894 1088 3208 4316 692 18285 EPUITf CONTRIBUTIONS 0 0 490 0 0 1160 1650 -6376 971 975 -111 0 28 -4613 SPECIAL DEPOSITS 0 ) 0 0 0 0 0 -376 0 0 0 12 0 -364 DEFERRED CREDITS 0 0 0 0 0 0 0 -884 -170 487 0 0 0 -567 bORRCWING 48070 46980 21640 56720 34140 38010 245560 44633 26756 13697 29805 18786 25619 159296 TOTAL SOURCES 64980 59640 27350 71130 42450 48290 313840 45084 28451 16147 32902 23114 26339 172037 APPLICATIONS: FEASIBILITY STUDIES 0 0 0 0 0 0 0 0 4874 0 0 614 22558 28046 MNSTRUCTION 45000 43850 20220 51890 30790 35570 227320 39908 22702 12598 31515 20052 2816 129591 CAPITALIZED INTEREST 8720 8830 AAS0 11200 7120 7140 47090 7758 0 2583 0 0 0 10341 OTHER WORKS 1000 0 0 0 0 0 1000 671 478 140 0 344 421 2054 DEBT SERVICING 7790 5030 2350 5900 3650 4050 28770 2355 545 31 58 1329 467 4785 WORKlNG CAPITAL 2470 1930 700 2140 890 1 0 9660 -5608 -173 795 1329 775 77 -2805 CONTRIBUTIONS 0 0 0 0 0 0 0 0 25 0 0 0 0 25 TOTAL APPLICATIONS 6,7^ 59640 27350 71130 42450 48290 313840 45084 28451 16147 3202 23114 26339 172037 P H I L I F P I k E S FIRST PRO INCIAL WATE- SUPPLY PROJECT WDS COMBINED ' 1977-1982 8A00 CABA%A' 4 Li; LU-PA-TA LA UNION TARLAC TOTAL BAGUI CABAHA'M LIPA LU-PA-TA LA UNION TARLAC TOTAL -- TAFF APPRAISAL ----------- - ------ - -ACTUAL - ---ORM -ANCE---- PALA: c ET ( PESOS 000IS > PESOS 000'S ASSETS. rIXED ASSETS 59980 56060 27790 81200 49900 4457. 319360 23718 5573 5776 20162 4760 3513 63502 DEPRECIATION 4350 5490 4230 157 9 7760 2990 40550 5973 2855 2893 1506 1665 401 15293 NET FIXED ASSETS IN OPER'N 15630 50570 23560 65470 42040 41540 279810 17745 2718 2883 18656 3095 3112 48209 WORN IN PROE-: 0 0 0 0 0 0 0 44955 25301 12111 14999 19409 23112 139887 CURRENT ASSETS LASH 1230 1370 550 1310 360 1060 5880 243 101 47 1697 391 173 2652 ACCOUNTS RECEIVABLE - VATER 1730 860 360 105% 40 670 5310 674 219 574 224 119 38 1849 ACCOUNTS RECEIVABLE - OTHER 0 0 0 0 0 0 0 295 0 0 0 0 0 295 INVENTORY 210 80 40 120 70 70 590 2072 282 423 83 121 162 3143 OTHER CURREm ASSE' 0 0 0 0 0 0 0 92 1719 5 32 955 154 2957 TOTAL CURRENT ASSETS 3170 2310 950 2480 1070 1800 11780 3376 2321 1049 2036 1586 527 10895 DEFERRED ASSETS -FS STUDIES 0 0 0 0 0 0 0 1381 1267 4 0 0 2652 SPECIAL DEPOSITS 0 0 0 0 0 0 0 720 0 27 0 0 0 747 TDTAL OTHER ASSETS 0 0 0 0 0 0 0 720 1381 1294 4 0 0 3399 TOTAL ASSETS 58800 52880 24510 675 43110 44:40 290590 66796 31721 17337 35695 24090 26751 202390 EQUITY AND LIABILITIES. EQUITY: CAPITAL 3000 1630 1460 9450 8500 1670 25710 11105 1605 2678 2068 1859 941 20256 CONTRIBUTIONS 1130 970 510 630 320 1180 4740 0 971 0 0 0 0 971 RETAINED EARNINGS 6100 3470 990 1490 380 2520 14950 4080 -345 206 2231 2976 179 9327 TOTAL EQUITY 10230 070 2960 11570 9200 5370 45400 15185 2231 2884 4299 4835 1120 30554 LIABILITIES: LON5 TERN LIABILITIES 4"0" 46000 21190 55540 33400 37210 240400 44991 26438 13757 31156 18337 24876 159555 CURRENT LiAS :L; IE- AECOUNTt AbLE - LWUA 0 0 20 60 50 70 200 1396 0 0 0 0 0 1396 ACCOU"TS PAABLE - OTHER 400 80 100 0 0 0 580 4158 127 156 55 599 143 5238 CURRENT MATURITIES 510 530 240 630 380 420 2730 77 0 52 0 127 288 544 OTHER CURRENT LIABILITIES 580 200 0 150 80 270 1280 839 2296 0 185 180 324 3824 T-TAL CURRENT .IABLITIES 1510 810 360 840 510 760 4790 6470 2423 208 240 906 755 11002 i:ERED LIAMlLITIES 0 0 0 0 0 0 0 150 629 488 0 12 0 1279 TOTAL E2UITY AND LIAB'TIES 58800 52880 24510 67?50 43110 43340 290590 66796 31721 17337 35695 24090 26751 202390 - - -- --- -- -- --- -- -- -- -- - - - - - - - - -- - PHILIPPINES FIRST PROVINCIAL MATER SUPPLY PROJECT NAME OF WATER DISTRICT: BAGUIO 1977 1978 1979 1990 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORNANCE STATISTICAL IVFOTION - MATER PRODUCED 000' CU,M 6910 6910 6910 7000 7000 7000 41730 7721 8045 7831 7643 9073 9699 49003 WATER SOLD 000' CU.M 3170 3430 3800 4220 4530 4900 24050 3082 3564 386 3719 3812 4320 22353 UNDILLED ATER % 54 50 45 40 35 30 42 60 56 51 51 53 55 54 CONNECTIONS No. 7150 7800 9140 10430 11100 11830 9575 8342 9178 10137 11742 11436 12570 10568 INCOE STATENTS ( PESOS 000'S ) ( PESOS 000'S REVENUES: SALES OF WATER (NET) 5390 5830 6470 8440 9060 13730 48920 4398 5403 510 5903 7181 6719 37114 OTHER OPERATIONAL REVENUE 100 100 110 110 120 120 660 183 219 217 252 355 518 1744 TOTAL OPERATING REVENUE 5490 5930 650 8550 9180 13850 49560 4581 5622 5727 6155 7536 9237 38958 EXPENDITURES: waES 860 940 1050 1140 1370 1640 7000 976 998 1043 2134 2567 3082 10800 CHEMICALS 60 70 70 80 90 100 470 28 91 96 149 194 163 711 O POWER 2760 2910 3110 3270 3440 3770 19260 1777 1626 1934 869 1654 3112 10972 MATERIALS 440 480 530 590 640 770 3450 277 387 223 345 424 392 2048 OTHER DIRECT EXPENSES 150 160 180 200 240 280 1210 465 636 904 653 732 1332 4722 INDIRECT EXPENSES 270 290 320 420 450 690 2440 0 0 0 0 0 0 0 DEPRECIATION 130 130 260 840 1380 1490 4230 479 332 658 1096 1163 1400 5128 TOTAL OPERATING EXPENDITURE 4670 4990 5520 6540 7610 8740 38060 4002 4060 489 5246 6734 9461 34391 NET OPERATING INCOME 820 950 1060 2010 1570 5110 11520 579 1562 869 909 802 -244 4477 OTHER EXPENDITURESI 0 INTEREST 200 160 120 80 40 4510 5110 175 173 107 26 9 255 745 NON-OPERATING 0 0 0 0 0 0 0 -35 -65 -302 -181 -197 -72 -1503 MISCELLAiEOUS 0 0 0 0 0 0 0 130 0 0 90 0 267 487 TOTAL OTHER EXPENDITURES 200 160 120 80 40 4510 5110 270 108 -195 -65 -198 -201 -271 NET INCOME 620 790 940 1930 1530 600 6410 309 1454 1064 974 990 -43 4748 PERFORMANCE INDICATORS: AVERAGE RATE SASE P NN 5065 4935 9930 32655 53210 55865 8186 9054 11860 13934 14993 16895 RATE OF RETURN % 16.19 19.25 10.67 6.16 2.95 9.15 7,07 17.25 7.33 6452 5.35 -1.45 tORKING RATIO % 83 82 80 67 68 52 77 66 73 67 74 87 PRICE PER CUBIC METER P 1.70 1.70 1,70 2.00 2.00 2.90 1.43 1.52 1.43 1.59 1.89 2.02 PHILIPPINES FIRST PROVINCIAL WATER SUPPLY PROJECT NAME OF WATER DISTRICT: BAGUID 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMhANCE ------ ------ ----- ------ ----- ------------ ----- ----------- CASH FLOW STATENENTS ( PESOS 000'S ) ( PESOS 000'S SOURCES: OPERATING SURPLUS 950 1080 1330 2860 2960 6590 15770 1058 1894 1527 2005 1965 1156 9605 GRANTS FOR OPERATIONS 0 120 260 290 220 250 1140 0 0 0 0 0 0 0 INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS 0 0 0 0 0 0 0 -95 65 126 -65 -142 -1407 -1518 ----------------------------------------------------- - ------------------ INTERNAL CASH GENERATION 950 1200 1590 3150 3180 6840 16910 963 1959 1653 1940 1823 -251 9087 EQUITY CONTRIBUTIONS 0 0 0 0 0 0 0 0 0 0 -6074 24 -326 -6376 SPECIAL DEPOSITS 0 0 0 0 0 0 0 -52 96 199 101 -611 -109 -376 DEFERRED CREDITS 0 0 0 0 0 0 0 -1023 2 170 -35 257 -255 -884 BORROWING 140 4120 20730 18920 4160 0 48070 1383 2878 2672 11757 17120 8823 44633 TOTAL SOURCES 1090 5320 22320 22070 7340 6840 64980 1271 4935 4694 7689 18613 7882 45084 APPLICATIONS: FEASIBILITY STUDIES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CONSTRUCTTI 140 3930 19810 18080 3040 0 45000 899 3426 2786 5980 19088 7729 39908 CAPITALIZED INTEREST 0 200 1310 3090 4120 0 8720 71 341 449 807 2569 3521 7758 OTHER VORKS 0 0 0 0 0 1000 1000 0 0 348 0 0 323 671 DEBT SERVICING 640 600 560 520 480 4990 7790 481 676 908 26 9 255 2355 WORKING CAPITAL 310 590 640 380 -300 850 2470 -180 492 203 876 -3053 -3946 -50 EQUITY CONTRIBUTIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL APPLICATIONS 1090 5320 22320 22070 7340 6840 64980 1271 4935 4694 7689 18613 7882 45 PERFORMANCE INDICATORS: DEBT SERVICE RATIO 1 1.48 1.80 2.38 5.50 6.17 1.32 2.02 2.20 2.80 1.68 77.12 218.33 4.53 4.08 SELF FINANCING RATIO x 679 31 8 17 105 N.A. 38 107 57 59 32 10 -3 20 PHILIPPINES FIRST PROVINCIAL WATER SUPPLY PROJECT NAME OF WATER DISTRICT: BA6UIO 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAt PERFORMANCE BALANCE SHEETS PESOS 000'5 1 PESOS 000'S i ASSETS: clXED ASSETS 5250 5250 15640 51810 58980 59980 59980 9873 11724 1o368 17374 20601 23718 23718 DEPRECIATION 250 380 650 1490 2880 4350 4350 1579 1910 2463 3412 4577 5973 5973 NET FIXED ASSETS IN OPER N 5000 4870 14990 50320 56100 55630 55630 8294 9814 13905 13962 16024 17745 17745 404 IN PROGRESS 140 4270 15000 0 0 0 0 10805 13331 12288 18069 36499 44955 44955 CJRRENT ASSETS CASH 110 430 1080 1270 940 1230 1230 2 245 273 454 124 243 243 ACCOUNTS RECEIVABLE - WATER 690 740 820 1070 1150 1730 1730 761 873 578 489 649 674 674 ACCOUNTS RECEIVABLE - OTHER 0 0 0 0 0 0 0 103 160 621 987 846 295 295 INVENTOR? 130 140 150 170 180 210 210 352 327 369 902 1083 2072 2072 OTHER CURRENT ASSETS 0 0 0 0 0 0 0 37 242 562 382 26 92 92 TOTAL CURRENT ASSETS 930 1310 2050 2510 2270 3170 3170 1255 1847 2403 3214 2728 3376 3376 DEFERRED ASSETS -FS STUDIES 0 0 0 0 0 0 0 610 0 0 0 0 0 0 SPECIAL DEPOSITS 0 0 0 0 0 0 0 397 300 101 0 611 720 720 TOTAL OTHER ASSETS 0 0 0 0 0 0 0 1007 300 101 0 611 720 720 m ----------- ------------------------------------------------------------- TOTAL ASSETS 6070 10450 32040 52830 58370 58800 58800 21361 25292 28697 35245 55862 66796 66796 EQUITY AND LIABILIES. EQUITY: CAPITAL 3000 3000 3000 3000 3000 3000 3000 17481 17481 17481 11407 11431 11105 11105 CONTRIBUTIONS 0 120 370 670 880 1130 1130 0 0 0 0 0 0 0 RETAINED EARNINGS 300 1090 2040 3970 5500 6100 6100 -9 1445 2509 3483 4123 4080 4080 TOTAL EQUITY 3300 4210 5410 7640 9380 10230 10230 17472 18926 19990 14890 15554 15185 15185 LIABILITIES: LONG TERM LIABILITIES 1450 5130 25430 43910 47590 47060 47060 2673 4697 6751 19002 35645 44991 44991 CURRENT LIABILITIES ACCOUNTS PAYABLE - LOUA 0 0 0 0 0 0 0 0 0 0 0 1396 1396 ACCOUNTS PAYABLE - OTHER 540 300 320 340 370 400 400 306 332 604 448 2912 4158 4158 CURRENT MATURITIES 440 440 440 440 490 530 530 503 854 618 124 600 77 77 OTHER CURRENT LIABILITIES 340 370 440 500 540 580 580 396 470 551 633 746 839 839 TOTAL CURRENT LIABILITIES 1320 1110 1200 1280 1400 1510 1510 1205 1656 1773 1205 4258 6470 6470 DEFERRED LIABILITIES 0 0 0 0 0 0 0 11 13 183 148 405 150 150 TOTAL EQUITY AND LIAP'TIES 6070 10450 32040 5830 58370 58800 58800 21361 25292 28697 35245 55862 6679o 66796 PERFORKANCE INDICATORS: WORKING CAPITAL P MN -390 200 850 1230 870 1660 1660 50 191 630 2009 -1530 -3094 -3094 CURRENT RATIO % 0.70 1.18 1.71 1.96 1.62 2.10 2.10 1.04 1.12 1.36 2.67 0.64 0.52 0.52 OEARIN6: LIABILITIES z % 46 60 83 86 84 83 83 18 25 30 58 72 '7 77 PKIL IPPINES Flks P ~O.INCIL WATER SUFPPLY PRD.ECT NAME OF WATER DISTRICT: CAPANATUAN 197' 1979 1979 1980 3091 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTJAL PERFORMANCE STATISTICAL INFORMATION WATEP PRODUCED 000' CU.M 2150 2260 3000 3740 4060 4380 19590 2150 2479 2503 2452 2407 3266 15257 WATER SQLD 000' CU." 1100 1250 1760 2280 2620 2960 11970 1100 1368 1453 1390 1375 1700 8386 UNBILLED WATER 49 45 41 39 35 32 39 49 45 42 43 43 48 45 CONNECTIONS NO. 3000 3500 3800 4480 5640 6800 4537 2539 2853 3036 3185 3307 5278 3366 INCOME STATEMENTS PESOS 000'S ( PESOS 000'S REVENUES: SALES OF WATER iNET) 880 1000 1760 3420 3930 a820 17810 820 1011 1213 1428 1779 2362 8613 OTHER OPERATIONAL REVENUE 30 30 40 40 40 50 230 31 53 44 59 65 113 365 TOTAL OPERATING REVENUE 910 1030 1800 3460 3970 6870 18040 851 1064 1257 1487 1844 2475 8978 EXPENDITURES: WA6ES 300 330 360 390 460 570 2410 393 522 708 792 989 1146 4550 CHEMICALS 20 20 30 0 50 60 220 2 6 14 11 14 10 57 POwER 120 140 200 270 320 380 1430 156 179 161 315 373 637 1821 MATERIALS 40 50 60 150 250 280 830 53 94 99 104 120 180 e5o OTHER DIRECI EXPENSES i0 70 80 90 110 130 550 1 126 153 185 167 181 813 INDIRECT EXPENSES 40 50 90 170 200 340 890 0 0 0 0 0 0 0 DEPRECIATION 80 80 240 740 1240 1400 3780 112 167 190 203 237 257 1166 TOTAL OPERATING EXPENDITURE 670 740 1060 1850 2630 3160 10110 717 1094 1325 1610 1900 2411 9057 NET OPERATING INCONE 240 290 740 1610 1340 3710 7930 134 -30 -68 -123 -56 64 -79 OTHER EXPENDITURES*: INTEREST 10 10 10 to 0 4410 4450 21 36 40 0 10 4 111 NON-OPERATING 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL OTHER EXPENDITURES 10 10 10 10 0 4410 4450 21 36 40 0 10 4 111 NET INCOME 230 280 730 1600 1340 -700 3480 113 -66 -108 -123 -66 60 -190 PERFORMANCE INDICATORS: AVERAGE RATE BASE P MN 195 1545 7665 27135 46205 51270 988 2068 2199 2353 2647 2773 RATE OF RETURN Z 30.19 18.77 9.65 5.93 2.90 7.24 13.56 -1.45 -3.09 -5.23 -2.12 2.31 ORING RATIO % 65 64 46 32 35 26 71 87 90 95 90 87 PRICE PER CUBIC METER p 0.80 '1.80 1.00 j.50 1.50 2.30 0.75 0.74 0.93 1.03 1.29 1.30 PHI LI PP IN ES FIRST PROVINC'AL WATER SUPPLY PROJECT ANAE OF WATER DISTRICT: CABANATUAN 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMANCE CASH FLOW STATEMENTS ( PESOS 000'S ) ( PESOS 000'S ) SOURCES: OPERATING SURPLUS 330 370 980 2350 2580 5110 11720 246 137 122 80 181 317 1083 GRANTS FOR OPERATIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS 20 110 90 160 270 290 940 -58 -109 -24 7 -10 5 -189 INTERNAL CASH GENERATION 350 480 1070 2510 2850 5400 12660 188 28 98 87 171 322 894 EGUITY CONTRIBUTIONS 0 0 0 0 0 0 0 75 57 67 83 48 641 971 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 DEFERRED CREDITS 0 0 0 0 0 0 0 0 0 216 -300 -541 455 -170 BORROWING 410 11420 14630 9950 10570 0 46980 1070 1693 2094 4905 13515 3479 26756 TOTAL SOURCES 760 11900 15700 12460 13420 5400 59640 1333 1778 2475 4775 13193 4897 28451 APPLICATIONS: FEASIBILITY STUDIES 0 0 0 0 0 0 0 834 748 471 1048 1773 0 4874 CONSTRUCTION 400 10910 13910 9540 9020 0 43850 0 843 1925 3608 11506 4820 22702 CAPITALIZED INTEREST 20 550 1710 2810 3740 0 8830 0 0 0 0 0 0 0 OTHER WORKS 0 0 0 0 0 0 0 375 93 10 0 0 0 478 DEST SERVICING 30 30 30 30 30 4880 5030 21 36 40 57 192 199 545 WORKING CAPITAL 310 410 -20 80 630 520 1930 91 56 24 59 -281 -122 -173 EQUITY CONTRIBUTIONS 0 0 0 0 0 0 0 12 2 5 3 3 0 25 TOTAL APPLICATIONS 760 11900 15700 12460 13420 5400 59640 1333 1779 2475 4775 13193 4897 28451 PERFORMANCE INDICATORS: KIT SERVICE RATIO % 11.00 12.33 32.67 78.33 86.00 1.05 2.33 11.71 3.81 3,05 1*40 0.94 1.59 1.99 SELF FINANCING RATIO 2 88 4 8 26 32 NA 29 NA 3 5 2 1 7 4 PHILIPPINES FIRST PROVINCIAL WATER SUPPLI PR0.:ECT ME OF MATER DISTRICT: CABMTUA 197' 1978 1K7 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL S TAFF APP AISAL ACTUAL PERFORNANCE BALANCE SHEETS PESOS OO'S 4 PESOS 000'S ASSETS: FIXED ASSETS 3370 3370 15940 43290 56060 56060 56060 3777 4127 4396 4828 5425 5573 5573 DEPRECIATI-IN 1780 1870 2110 2850 4090 5490 549 1801 1968 2158 2361 2598 2855 2855 NET F.XED ASSETS IN OPER'N 1590 1500 13830 40440 51970 50570 50570 1976 2159 2238 2467 2827 2718 2718 40RK IN PROSPESS 410 11880 15010 10 0 0 0 0 4 1670 4846 15755 25301 25301 CURRENT ASSETS CASH 340 '40 63N 530 1150 1370 1370 65 114 182 176 122 101 101 ACCOUNTS RECEIYABLE - WATER 110 130 220 430 500 860 860 119 145 134 129 138 219 219 ACCOUNTS RECEIVABLE - OTHEP 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INVENTOPY 20 20 20 50 70 80 80 12 10 15 102 94 282 22 OTHER CURRENT ASSETS 0 0 0 0 0 0 0 5 11 22 22 758 1719 1719 TOTAL CURRENT ASSETS 470 890 870 1010 1720 2310 2310 201 280 353 429 1112 2321 2321 DEFERRED ASSETS -FS STUDIES 0 0 0 0 0 0 0 834 2164 2525 4006 6369 1381 1381 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL OTHER ASSETS 0 0 0 0 0 0 0 834 2164 2525 4006 6369 1381 1381 TOTAL ASSETS 2470 14270 29710 41460 53690 52980 52880 3011 4607 6786 11748 26063 31721 31721 EQUITY AND LIABILIES: EQUITY: CAPITAL 1630 1630 1630 1630 1630 1630 1630 1618 1616 1611 1608 1605 1605 1605 CONTRIBUTIONS 60 170 260 420 690 970 970 75 132 199 292 330 971 971 PETAINED EARNINGS 210 490 1220 2820 4170 3470 3470 89 -86 -218 -334 -410 -345 -345 TOTAL EQUITY 1900 2290 3110 4870 6490 6070 6070 1782 1662 1592 1556 1525 2231 2231 LIABILITIES' LONG TERM LIQILkTES 500 11890 26440 36430 46520 46000 46000 1190 2883 4920 9643 22959 26438 26438 CURRENT LIABILITIES ACCONTS PAYALE - LWUA 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ACCOUNTS PAYABLE - OTHER 20 30 40 60 '0 80 80 3 36 45 62 117 127 12, CURREVftATURITIES 20 20 20 20 470 530 530 0 0 57 182 199 0 0 DTHER CRRENT LIABILITIES 30 40 50 80 140 200 200 36 26 66 66 975 2296 2296 TOTAL CURRENT LIABILITIES 70 90 110 160 680 810 810 39 62 168 310 1291 2423 2423 DEFERRED LIABILITIES 0 0 0 0 0 0 0 0 106 239 288 629 629 TOTAL EQUITY AND LIA)'TIES 2470 1A270 29710 41460 53690 52880 52880 3011 4607 6786 11748 26063 31721 3172 PERFORMANCE INDICATORS; MR46 CAPITAL P AN 40t 800 760 950 1040 1500 1500 162 218 185 119 -179 -102 -651 CURRENT PATIO Z 6.71 a.9o '.91 ,.31 2.53 2.85 2.85 5.15 4.52 2.10 1.38 0.86 0.96 0.96 6EAR!IS: LIABILTIES - 21 83 g9 88 sB 88 98 40 63 '3 84 89 83 83 PHILIPPINES FIRST PROVINCIAL WATER SUPPLY PROJECT NAME OF WATER DISTRICT: LA UNION 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORNANCE STATISTICAL INFORMATION WATER PRODUCED 000' CU-M 1440 1440 1440 1440 1760 2110 9630 971 1004 1120 1241 1234 1726 7296 WATER SOLD 000' CU.N 650 720 790 940 1230 1520 5850 511 582 635 727 744 1018 4217 UNBILLED WATER % 55 50 45 35 30 30 39 47 42 43 41 40 41 254 CONNECTIONS NO. 1000 1120 1240 1450 1950 2450 1127 1056 1148 1270 1581 1736 2263 9054 INCOME STATEMENTS ( PESOS 000'S ) ( PESOS 000'S REVENUES: SALES OF WATER (NET) 650 720 1420 1690 2220 5010 11710 627 707 1103 1256 1813 2643 8149 OTHER OPERATIONAL REVENUE 30 30 40 40 40 50 230 38 28 12 53 13 94 238 TOTAL OPERATING REVENUE 680 750 1460 1730 2260 5060 11940 665 735 1115 1309 1926 2737 8387 EXPENDITURES: WAGES 200 220 240 260 310 380 1610 227 244 378 532 604 744 2729 CHEMICALS 10 10 20 20 20 30 110 5 15 32 13 17 16 98 POWER 10 10 10 10 50 200 290 4 16 5 4 10 171 210 MATERIALS 70 70 80 90 240 250 800 88 104 114 178 214 274 972 OTHER DIRECT EXPENSES 60 70 70 80 100 120 500 0 1 56 1 2 18 78 INDIRECT EXPENSES 30 40 70 80 110 250 590 0 0 0 0 0 0 0 DEPRECIATION 300 270 420 830 1190 1250 4260 89 91 94 117 122 129 642 TOTAL OPERATING EXPENDITURE 680 690 910 1370 2020 2480 8150 413 471 679 845 969 1352 4729 NET OPERATING INCO E 0 60 550 36- 240 2580 3790 252 264 436 464 857 1385 3658 OTHER EXPENDITURES: INTEREST 0 10 0 0 0 3210 3220 18 19 44 27 3 712 823 NON-OPERATING 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLAEOUS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL OTHER EXPENDITURES 0 10 0 0 0 3210 3220 18 19 44 27 3 712 823 NET INCOME 0 50 550 360 240 -630 570 234 245 392 437 854 673 2835 PERFORMANCE INDICATORS: AVERAGE RATE BASE P MN 8250 7955 12585 28410 41375 42665 2112 2330 2404 2814 3111 3109 RATE OF RETURN 1 0.00 0.75 4.37 1.27 0.58 6.05 11.93 11.33 17.55 16.49 27,55 44.55 MRKIN RATIO 2 56 56 34 31 37 24 49 52 52 56 46 45 PRICE PER CUBIC ETER P 1.00 1.00 1.80 1.80 1.80 3.30 1,23 1.21 1.74 1.73 2.44 2.60 PHILIPPINES FIRST PROVINCIAL WATER SUPPLY PROJECT NAME OF WATER DIST&&CT: LA UNION 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMANCE CASH FLOV STATEMENTS ( PESOS 000'S ) ( PESOS 000'S > SOURCES: OPERATING SURPLUS 300 340 970 1190 1420 3840 8060 341 355 530 581 979 1514 4300 GRANTS FOR OPERATIONS 0 20 30 50 100 120 320 0 0 0 0 0 0 0 INTEREST -70 0 0 0 0 0 -70 0 0 0 0 0 0 0 MISCELLANEOUS 0 0 0 0 0 0 0 8 -36 -52 -10 55 51 16 INTERNAL CASH GENERATION 230 360 1000 1240 1520 3960 8310 349 319 478 571 1034 1565 4316 EQUITY CONTRIBUTIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 12 12 DEFERRED CREDITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 BORROWIN6 380 8590 13180 8880 3110 0 34140 767 1428 703 3726 9387 2775 18786 TOTAL SOURCES 610 8950 14180 10120 4630 3960 42450 1116 1747 1181 4297 10421 4352 23114 APPLICATIONS: FEASIBILITY STUDIES 0 0 0 0 0 0 0 605 0 0 9 0 0 614 CONSTRUCTION 360 8200 12590 7550 2090 0 30790 367 1592 682 4007 10000 3404 20052 CAPITALIZED INTEREST 10 420 1390 2380 2920 0 7120 0 0 0 0 0 0 0 OTHER MORKS 0 0 0 0 0 0 0 8 70 266 0 0 0 344 DEBT SERVICING 20 20 30 20 10 3550 3650 18 19 44 386 150 712 1329 WORKING CAPITAL 220 310 170 170 -390 410 890 118 66 189 -105 271 236 775 ** EQUITY CONTRIBUTIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL APPLICATIONS 610 8950 14190 10120 4630 3960 42450 1116 1747 1181 4297 10421 4352 23114 PERFORMNCE INDICATORS: DEBT SERVICE RATIO 1 15.00 17.00 32.33 59.50 142.00 1.08 2.21 18.94 18.68 12.05 1.51 6.53 2.13 3.24 SELF FINANCING RATIO Z 64 4 8 16 73 N.A. 27 95 20 70 14 10 46 22 PHILIPPINES FIRST PROVINCIAL MATER SUPPLY PROJECT NMIE OF MATER DISTRICT: LA WION 1977 1978 1979 1980 1991 1992 TOTAL 1977 1979 1979 1990 1981 1992 TOTAL STAFF APPRAISAL ACTUAL PERFORflANCE BALANCE SHEETS PESOS 00O'S ( PESOS OO'S ASSETS: FIXED ASSETS 1180 1180 21860 44790 49900 49900 49900 3637 3940 4112 4797 4882 4760 4760 DEPRECIATION 3790 4070 4500 5330 6510 7760 7760 1414 1503 1582 1699 1759 1665 1665 NET FIXED ASSETS IN OPER'N 8100 7910 17360 39460 43290 42040 42040 2223 2437 2530 3099 3123 3095 3095 ORK IN PROGRESS 380 9000 13000 0 0 0 0 134 2096 2859 6181 16105 19409 19409 CURRENT ASSETS CASH 180 480 570 710 270 360 360 147 128 162 57 193 391 391 ACCOUNTS RECEIYAILE - MATER 90 90 180 220 290 640 640 20 31 33 35 54 119 119 ACCOUTS RECEIVALE - OTHER 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INUENTORY 20 20 30 30 60 70 70 41 49 63 67 72 121 121 TRCURRENT ASSETS 0 0 0 0 0 0 0 9B 175 322 314 378 955 955 TOTAL CURRENT ASSETS 290 590 780 960 610 1070 1070 296 383 580 473 697 1586 1586 DEFERRED ASSETS 4S STUDIES 0 0 0 0 0 0 0 605 0 0 9 0 0 0 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL OTHER ASSETS 0 0 0 0 0 0 0 605 0 0 9 0 0 0 TOTAL ASSETS 8760 17400 31140 40420 43900 43110 43110 3259 4916 5969 9761 19925 24090 24090 EQUITY AND LIABILIES: EUITY: CAPIT 8500 8m 8500 8500, 550 8500 50 1889 1859 1859 9 59 1959 CONTRIBUTIONS 0 20 50 90 200 320 320 0 0 0 0 0 0 0 RETAINED EARNINGS -190 -150 390 750 990 3 30 367 576 916 1343 2252 2976 2976 TOTAL EQUITY 9310 8370 8940 9340 9690 9200 9200 2226 2435 2775 3202 4111 435 4835 LIABILITIES: LONG TERi LIABILITIES 410 8970 22150 31010 33790 33400 33400 951 2379 2723 6302 15689 19337 19337 CURRENT LIABILITIES ACCONTS PAYABLE - LMIA 10 30 10 20 40 50 50 0 0 0 0 0 0 0 ACCOWTS PAYABLE - OTHER 0 0 0 0 0 0 0 4 14 it 29 15 599 599 CURRENT NATURITIES 10 10 10 10 340 390 390 0 0 359 147 0 127 127 OTHER CURRENT LIABILITIES 20 20 30 40 50 90 80 77 88 101 81 110 180 190 TOTAL CURRENT LIABILITIES 40 60 50 70 430 510 510 81 102 471 257 125 906 906 W DEFERMED LIABILITIES 0 0 0 0 0 0 0 0 0 0 0 0 12 12 TOTAL EQUITY AND LIAB'TIES 8760 17400 31140 40420 43900 43110 43110 3258 4916 5969 9761 19925 24090 24090 PERFORNCE INDICATORS: WORKIN CAPITAL Pm 240 530 730 890 190 560 560 215 291 109 216 572 690 680 ClIENT RATIO 1 7.00 9.93 15.60 13.71 1,42 2.10 2,10 3.65 3.75 1,23 1.84 5.58 1.75 1.75 BEMIM LIABILITIES * 1 5 52 71 77 78 79 79 32 50 54 67 79 so so P NILIPPINES FIRST PROVINCIAL UATER SUPPLY PROJECT NAE OF MATER DISTRICT* LIPA 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL ST AFF APPRAISAL ACTUAL PERFORMANCE STATISTICAL IMFORMATION WATER PRODUCED 000' CU.M 850 930 1150 1360 1450 1570 7310 938 995 989 1147 1228 1660 6957 WATER SOLD 000' CU.m 370 470 640 810 960 1110 4360 387 423 481 479 593 900 3263 UNBILLED ATER x 56 49 44 40 34 29 40 59 57 51 58 52 44 53 COWHECTONS NO. 850 950 1430 1900 2450 3000 1263 1140 1273 1463 1509 2133 4000 1920 INCONE STATEMENTS ( PESOS 000'S P (PSOS 000'S) REVENUES: SALES OF WATER (NET) 260 330 900 1300 1540 2880 7210 325 373 507 646 795 1529 4175 OTHER OPERATIOMAL REVEUE 10 10 10 10 20 20 80 24 23 28 34 61 76 246 TOTAL OPERATIN6 RENUE 270 340 910 1310 1560 2900 7290 349 396 535 680 856 1605 4421 EXPENDITURES. UABES 100 110 120 130 160 200 820 106 129 192 242 315 449 1433 CHENICALS 10 10 10 20 20 20 90 7 11 11 12 11 6 58 POUER 30 40 50 70 80 90 360 76 85 108 167 228 431 1015 MATERIALS 20 20 20 70 120 140 390 37 9 14 21 27 43 151 OTER DIRECT EXPE SES 10 10 10 10 20 20 80 35 67 76 110 104 182 574 INDIRECT EXPENSES 10 20 40 60 80 140 350 6 4 3 3 4 12 32 DEPRECIATION 90 80 150 380 620 690 2010 98 104 115 125 131 137 710 TOTAL OPERATING EXPENDITURE 270 290 400 740 1100 1300 4100 365 409 519 680 820 1260 4053 ØET OPERATININCOG E 0 50 510 570 460 1600 3190 -16 -13 16 0 36 345 368 OTER EXPENDITURES, INTEREST 10 10 10 0 0 2030 2060 0 0 0 0 0 0 0 NON-OPERATING 0 0 0 0 0 0 0 0 -2 -5 -11 -2 -7 -27 tISCEmAEOUS 0 0 0 0 0 0 0 1 0 0 18 0 0 19 TOTAL OTHER EXPEMITURES 10 10 10 0 0 2030 2060 1 -2 -5 7 -2 -7 -8 HET INCOME -10 40 500 570 460 -430 1130 -17 -11 21 -7 38 352 376 PERFOR ~CE INDICATORS: AVERAV E RATE BASE P M 1255 1165 3280 12240 21650 23910 1590 1562 1573 1581 1628 2282 RATE OF RETUR# Z 0.00 4.29 15.55 4,66 2.12 6.69 -1.01 -0.83 1,02 0.00 2.21 15.12 ORKING RATIO x 67 62 27 27 31 21 77 77 76 82 80 70 PRICE PER CUIC METER P 0.70 0.70 1.41 1,60 1.60 2.59 0.84 0.98 1,05 1.35 1.34 1.70 PHILIPPINES FIRST PROVINCIAL MATER SUPPLY PROJECT WAME OF WATER DISTRICT: LIPA 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMANCE CASH FLOV STATEMENTS ( PESOS 000'S ) ( PESOS 000'S SOURCES: OPERATING SURPLUS 90 140 650 950 1090 2300 5220 82 91 131 125 167 482 1078 GRANTS FOR OPERATIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS 0 0 0 0 0 0 0 0 2 6 -7 2 7 10 INTERNAL CASH GENERATION 90 140 650 950 1090 2300 5220 82 93 137 118 169 489 1088 ERUITY CONTRIBUTIONS 0 20 90 100 130 150 490 24 5 0 0 662 184 875 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 DEFERRED CREBITS 0 0 0 0 0 0 0 0 0 0 0 0 487 497 DORROMING 230 5230 6470 4870 4840 0 21640 606 1206 1068 1963 4456 4396 13697 TOTAL SOUmCES 320 5390 7210 5920 6060 2450 27350 712 1306 1205 2081 5287 5556 16147 0 0 APPLICATIONS: 0 0 FEASIBILITY STUDIES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 CONSTRUCTION 220 5000 6200 4680 4120 0 20220 625 1147 938 1753 4511 3624 12598 CAPITALIZED INTEREST 20 260 780 1290 1730 0 4080 46 166 219 360 704 1088 2583 OTHERVORKS 0 0 0 0 0 0 0 36 0 0 0 0 104 140 DEBT SERVICING 20 20 20 20 20 2250 2350 0 31 0 0 0 0 31 WORKING CAPITAL 60 110 210 -70 190 200 700 5 -38 48 -32 72 740 795 EOUITY CONTRIDUTIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL APPLICATIONS 320 5390 7210 5920 6060 2450 27350 712 1306 1205 2081 5287 5556 16147 PERFOR11MCE INDICATORS: DET SERVICE RATIO Z 4.50 7.00 32.50 47,50 54.50 1.02 2.22 NA 3.00 MA NA INA A NA SELF FINMCING RATIO t 41 3 10 20 26 N.A. 26 13 8 15 7 4 13 9 PH I LI PP I NE S F IRST I'P0 INC1AL MATER SUPPL1 PROJECT NAME OF WATER DISTICT: LIPA 1077 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL S TAFF APPRAISAL ACTUAL PERFORtANCE BALANCE SHEETS PESOS 0005 PESOS 000'S ASSETS: FIXED ASSETS 3520 3520 7980 21950 27790 27790 27700 3846 3945 4088 4202 4437 5776 5776 DEPRECIATION 2310 2400 2540 2910 3530 4230 4230 2282 2386 2502 2626 2757 2893 2893 NET FI(ED ASSETS IN OPER N 1210 1120 5440 19040 24260 23560 23560 1564 1559 1586 1576 1680 2883 2883 MOR IN PROGRESS 230 5480 8000 0 0 0 0 0 48 561 4155 8879 12111 12111 CURRENT ASSETS CASH 180 280 430 320 500 550 550 72 73 84 7 28 47 47 ACCOUNTS AECEIVABLE - TER 30 40 110 160 190 360 360 1 12 33 38 167 574 574 ACCOUNTS AECEIVABLE - OTHER 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INVENTORY 10 10 10 20 30 40 40 48 20 36 44 25 423 423 QTHER CURRENT ASSETS 0 0 0 0 0 0 0 1 6 8 16 9 5 5 TOTAL CLPWE*T ASSETS 220 330 550 500 720 050 950 138 111 161 105 229 1049 1049 DEFERRED ASSETS -FS 5TUIt15 0 0 0 0 0 0 661 1858 2360 766 1022 1267 1267 SPECIAL DEPOSITS 01 0 0 0 0 0 1 1 11 22 20 27 27 ------- ----------- ---------------- ------------------------- ------------------ ---- ---- - -- TOTAL OTHEA ASSETS 0 0 0 0 0 0 0 662 1859 2371 788 1042 1294 1294 TOTAL ASSETS 1660 eQ30 13990 19540 24980 24510 24510 2364 3577 4679 6624 11830 17337 17337 EQUITY AND LIABILIES: EQUITi: CAFITAL 1460 1460 1460 1460 1460 1460 1460 1828 1832 1832 1832 2494 2678 2678 CONTRIBUTIONS 30 50 140 240 370 510 510 0 0 0 0 0 0 0 RETAINED EAPNINGS -160 -120 380 960 1420 990 990 -188 -198 -177 -185 -147 206 206 TOTAL EQUITf 1330 1390 1980 2660 3250 2960 2960 1640 1634 1655 1647 2347 2884 2884 I_IAB1LITIE5* LONG TER" LIABILTIES 300 5500 11960 16810 21430 21190 21190 718 1926 2994 4959 9414 13757 13757 CURRENT LIA8LITIES 0 ACCOUNTS AYABLE - LVUA 10 20 20 20 20 20 20 0 0 0 0 0 0 0 ACCOUNTS PALE- OTHER 0 0 10 30 70 100 100 6 17 30 18 66 156 156 CURRENT MATURITIES 20 20 20 20 210 240 240 0 0 0 0 0 52 52 OTHER CURRENT LIAPILITIES 0 0 0 0 0 0 0 0 0 0 0 3 0 0 TOTAL CURRENT LIABILITIES 30 40 50 70 300 360 360 6 17 30 18 69 208 208 DEFERRED LIABILITIES 0 0 0 0 0 0 0 0 0 0 0 0 488 488 TOTAL EGUI"' AND L14?'TIES 1660 6930 13990 19540 24980 24510 24510 2364 3577 4679 6624 11830 17337 17337 PERFORRANCE INDICATORS: tORqlB CAf ITAL P Nw 190 290 500 430 420 590 590 132 94 131 87 160 841 841 CURRENT RAID % 7.33 8.25 11.00 7.14 2.40 2.64 2.64 23.00 6.53 5.37 5.83 3.32 5.04 5.04 GEARIN: LIABILITIES = 1 20 80 86 86 87 88 88 31 54 65 75 80 83 83 PHIL IPPINES FIRST PROVINCIAL WATER SUPPLY PROJECT --- - -- --------------- ---------------------- - ---- ------ NAME OF WATER DISTRICT: LIl-PA-TA 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMANCE ---- ------------- ------------ ------------------------- - - - ------------ STATISTICAL INFORMATION WATER PRODUCED 000* CU.M 7230 5620 5530 4990 5000 5600 32010 7230 7404 7106 6993 6805 8160 43698 WATER SOLD 000' CU.M 2750 2810 2870 2970 3100 3640 18160 2750 2759 3061 3184 3223 3640 18617 UNPILLED WATER % 62 50 48 40 38 35 43 62 63 57 54 53 55 57 CONNECTIONS NO. 5800 5950 6100 6250 7600 8850 6758 5000 5119 5589 6054 6310 6880 5925 INCOME STATEMENTS ( PESOS 000' ) PESOS 000'S REVENUES: SALES OF WATER (NET) 1380 1410 2300 3590 3720 8370 20770 800 936 1515 2118 2150 2435 9954 OTHER OPERATIONAL REVENUE 20 30 30 40 50 50 220 100 105 182 198 350 239 1174 TOTAL OPERATING REVENUE 1400 1440 2330 3630 3770 8420 20990 900 1041 1697 2316 2500 2674 11128 EXPENDITURES: WAGES 410 450 500 540 600 790 3290 400 462 514 831 1079 1206 4492 CHEMICALS 60 50 60 60 70 80 380 80 92 69 78 95 89 503 POWER 130 110 120 120 130 160 770 100 131 97 170 279 177 954 MATERIALS 90 100 150 280 380 400 1400 200 208 290 333 443 474 1948 OTHER DIRECT EXPENSES 40 40 50 50 60 60 300 0 0 201 13 50 19 283 INDIRECT EXPENSES 70 70 110 180 190 420 1040 0 0 0 0 0 0 0 DEPRECIATION 450 450 580 1230 1890 2030 6630 140 148 140 148 177 148 901 ------- ------- - ------------------ -------------------------- --------- - ------ TOTAL OPERATING EXPENDITURE 1250 1270 1570 2460 3320 3940 13810 920 1041 1311 1573 2123 2113 9081 ------ ---- -------------------------------------------- ---------- -- -------- NET OPERATING INCOME 150 170 760 1170 450 4480 7180 -20 0 386 743 377 561 2047 OTHER EXPENDITURES: INTEREST 0 0 0 0 0 5320 5320 0 8 7 0 0 0 15 NON-OPERATING 0 0 0 0 0 0 0 0 0 0 0 0 -262 -262 MISCELLANEOUS 0 10 0 10 50 0 70 0 0 0 0 0 0 0 -- --------------- - - - --------- --- ---- ---------- TOTAL OTHER EXPENDITURES 0 10 0 10 50 5320 5390 0 8 7 0 0 -262 -247 -- - --- -- - --- ----- ------- ------------- - - - - ---------- NET INCOME 150 160 760 1160 400 -840 1790 -20 -8 379 743 377 823 2294 PERFORMANCE INDICATORS. AVERAGE RATE BASE P MN 8785 835 13150 38155 62810 66485 6100 3192 3822 4758 6713 13514 RATE OF RETURN 2 1.71 2.04 5.78 3.07 0.72 6.74 -0.33 0.00 10410 15,62 5.62 4,15 WORKIN6 RATIO 2 57 57 42 34 38 23 87 86 69 62 78 73 PRICE PER CUBIC METER P 0650 0.50 0.80 120 120 2.30 -0.29 0.34 0.49 0,67 0,67 067 P-11 L IPP INE S 1 S T i 0 vi C i A L w A E R0J C NAME OF WATER DISTRICTI LU-PA-TA 1Q77 igs 1979 1980 1981 1982 TOTAL 19;? 1978 197Q 1980 1981 1982 TOTAL r AFF APPR A I SAL AC TUAL PERFOR bANCE --------------------------------------------------------------- ------------- ------------------------------------------------- CASH PLOW STATEMENT3 PESOS 000'S PESOS 000'S SOURCES: 9PERATING SURPLutkS 600 610 1350 2400 2240 6520 13770 120 148 525 890 554 971 3208 GRAMTS FOR OPERATIONS 0 30 30 40 260 280 640 0 0 0 0 0 0 0 INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS 9 0 0 0 0 0 0 0 0 (1 0 0 0 0 -------------------------------------------------------------- ------------------------------------------------------------- - iNTERNAL CASH SENERATIGS 600 -40 1380 2440 2550 6800 14410 120 148 525 890 554 971 3208 tQUITY COSTRIBUTIONS 0 00 0 0 0 0 0 -21 -33 -57 -111 SPEC t DEPOSITS 0 0 2 0 0 0 0 0 0 0 0 0 0 DEFERRED CREDITS v 0 0 0 0 0 0 0 tORPOWING 630 13"80 i900 13150 0260 0 56720 0 1323 104 3091 10462 14735 29805 10TAL SOURCES 1230 14420 21280 15590 11810 6800 71130 120 1471 719 3960 10983 15649 32902 APPkiC1 i051 FEASIBILITY ST9DIES 0 0 0 0 0 0 0 0 0 0 0 0 0 C1NSTRUCTION 210 1210 19020 12499 6600 0 51890 120 1377 849 3328 10830 15011 31513 CAPITAIbZE0 INTEREST 20 7 2180 3oo0 4070 0 11200 0 0 0 0 0 0 0 OTHEF kORNS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ET SERVICING 0 0 0 0 5900 5900 0 34 24 0 0 0 58 sORKING CAFITA 600 580 80 -,0 540 900 2140 0 60 -154 632 153 638 1329 EUITD CONTRIBUTIONS 0 0 0 0 0 0 0 1 0 0 0 0 0 c ---------------------------------------- --- -------------------- ------------------------------------------------------------> TOTAL APPLICATIGNS 1230 14420 21280 15540 11810 6800 71130 120 1471 719 3960 10983 15649 3290: PEFORMANCE INDICAORS DEiT SERVICE RATI . N A A NA A 1 2 NA 4 22 HA M NA 55 SELF 914ANCING RATIO 3S 5 39 N.A. 28 100 11 62 27 5 6 1v PH~ILIPPINES FIRST PROVlMCIAL WATER SUPPfY PROJECT NAME OF WATER DISTRICT* LU-PA-TA 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMANCE ------------ --------------- ------ ------------------------------------- ------------- BALANCE SHEETS PESOS 000'S ASSETS: FIXED ASSETS 18100 18100 28770 69930 81200 81200 81200 4000 4076 5495 6235 9729 20162 20162 DEPRECIATION 9540 9990 10580 11810 1.700 15730 15730 800 893 1034 1181 1358 1506 1506 ------------------------------------ -------------------------------------- - NET FIXED ASSETS IN OPER*N 8560 8110 18190 58120 67500 65470 65470 30 3183 4461 5054 8371 18656 16 WORK IN PROGRESS 630 14480 25000 0 0 0 0 70 1067 497 30B5 10202 1499 1499 CURRENT ASSETS CASH 550 1130 1110 360 730 1310 1310 500 550 440 q62 1251 1697 1697 ACCOUNTS RECEIVABLE - WATER 170 180 290 450 470 1050 1050 400 522 305 470 301 224 224 ACCOUNTS RECEIVABLE - OTHER 0 0 0 0 0 0 0 0 0 0 0 0 0 INVENTORY 40 40 50 80 110 120 120 10 13 26 40 66 83 83 OTHER CURRENT ASSETS 0 0 0 0 0 0 0 0 18 22 11 6 32 32 ------ - -------------- ----- --------------------------------- TOTAL CURRENT ASSETS 760 1350 1450 890 2310 2480 2480 910 1103 793 1483 1624 2036 2036 DEFERRED ASSETS -FS STUDIES 0 0 0 0 0 0 0 0 3 1 2 3 4 4 SPECIAL DEP4SITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 ----- -------------------------------------------------------------------- TOTALOTHEfASSETS 0 0 0 0 0 0 0 0 3 1 2 3 4 4 - -- -------------------- - -------- ----- - -- - ---- --- -- -- - ----- ------- --- TOTAL ASSETS 99SO 23940 44640 59010 69810 67950 67950 4180 5356 52 9624 20200 5695 69 EQUITY AND LIABILIES: EQUITY: CAPITAL 9450 9450 Q450 9?450 9450 9450 9450 2400 239 239 2377 2125 2068 2068 CONTR1BUTIONS 0 30 60 90 350 630 630 0 0 0 0 0 0 0 RETAINED EARNINGS -160 0 770 1930 2330 1490 1490 0 -91 288 1031 1408 2231 2231 --- -- ----- ------------- - ----------------------------------- -------------------- TOTAL EQUITY 9290 9480 10280 11470 12130 11570 11570 2400 2307 2686 3408 3533 4299 42" LIABILITIES. LONG TERM LIABILITIES 630 14420 34320 47480 56170 55540 55540 1560 2675 2869 5959 16421 3115o 31156 CURRENT LIABILITIES ACCOUNTS PAYABLE - LNUA 30 30 30 40 50 60 60 0 0 0 0 0 0 0 ACCOUNTS PAYABLE -OTE 0 0 0 0 0 0 0 10 11 24 71 106 56 56 CURRENTATURITIES 0 0 0 A 570 630 630 10 18 0 0 0 0 . OTHER CURRENT LIABILITIES 0 10 10 20 890 150 150 200 345 173 186 140 185 185 --------- --------------------- ---------------------------------------------------- TOTAL CURRENT LIABILITIES 30 40 40 60 1510 840 840 220 374 197 257 246 240 240 DEFERRED LIABILITIES 0 0 0 0 0 0 0 0 0 0 0 0 0 0 -------------------------------------------- ------------------------------------------------------------- - !OTAL EQUITT AN0 LIAB'TIES 9950 23940 44640 59010 69810 67950 67950 4180 5356 S752 9624 20200 35695 356Q5 PERFORNALE INDICATORS WORKIN6 CAPIAL 4. MN 730 1310 1410 830 800 1640 1640 90 720 596 1226 1378 1796 1796 CURRENT RATIO T. 25.33 33,75 325 14.83 1.53 2.95 2.95 4.14 2.95 4.03 577 6.60 E.4S 8.48 GEARING LIABILITIES 60 77 51 83 83 83 43 57 53 65 83 88 88 P I L I PP M E S I iYI4C IAL A E SUP LE PpR O E T ----------------------------------------------------------------------------------------- MAME OF WATER DISTRICT: TARLAC 1,7' 1O 19.9 1980 1981 1982 TOTAL 197 11-8 1979 1980 1981 1982 TOTAL B T A F A F AL A T U A L F E F 0 R AN C E .TATI ICAL INgIPMATION WATE FRelClel Q000 CU.* "0 820 145 2210 2810 3430 11490 475 409 451 49' 517 863 3212 QATER SOLD 000 (ýu. 430 490 91 1400 1940 2440 7670 238 2"4 302 325 339 449 1927 UNBILLED WATER 44 40 37 34 31 29 33 50 33 33 35 34 48 40 CONNECTIONS NO. 850 1000 250 3500 4700 5900 3033 777 i42 1049 1292 1496 2220 1296 INCOnE STATEhENTS PESOS )v-S ' PESOS 000'S RE ÆNUES: SALES OF WATER (NEUI 520 590 1460 2340 3100 5370 13380 309 373 501 676 871 1235 3Qb5 OTMER OPERATIONAL REVENUE 10 20 -0 20 30 20 120 2 - 1 4 10 40 ------------------------------------ -------------- ------------------------------------------------------------- - TrTAL OPERATING REVENUE 530 o10 1480 2360 3130 5390 135(0 311 375 508 6Q1 875 1245 4005 EFENiITURES: WAE3 150 1 0 : 200 250 200 1250 180 209 282 418 41: 499 2000 EHE4ICALS 10 1. :X 30 40 50 160 1 4 1 4 2 6 17 POWER '0 80 .'0 280 390 520 1510 60 ts 72 107 185 247 736 MATERIALS 330 0 40 120 200 230 650 36 39 83 98 139 150 545 OTHER 1IRECI EXPENSEE 20 "0 20 20 30 30 140 0 0 0 0 0 0 0 I$OiDECT EXPENSES 30 3c i 20 1b0 270 680 0 0 0 0 0 0 0 DEPRECIATION 50 50 1P0 580 980 1110 2940 - 43' 46 63 68 106 363 --------------------------- ---------------------------------------------------------------------------------- ------------------- TOTAL OPERATING EXPENDITURE 30 390 o80 1350 2050 2500 7330 313 360 484 o90 806 1008 3661 -------~-------------------------------------------- ------------------------------- ~-------------------------------- NET OPERATING INCOME .70 220 800 1010 1080 2890 o170 -2 15 24 1 69 237 344 OTHER EXPENDITURES: INTEREST 0 1 0 0 0 3570 3580 12 14 le 1 16 15 90 NON-OPERATING 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS i ) * 0 0 0 0 0 C 0 0 p 0 0 ---------------------------------- ----------------- ------------------------------------------------ ~-------------- TOTAL OTHER EXPENDITURES 0 10 0 0 0 3570 3580 12 14 16 17 16 15 90 (b --------------------------------------- -------- - --------------------------------- NET INCOME 170 210 800 1010 1080 -680 2590 -14 1 8 -16 53 222 254 PERFORMKACE 1«DICATORS' AVERAGE RATE BASE NFA P M# 1740 1695 6635 22655 38185 42100 897 1003 1060 1553 2435 2979 RATE OF RETURN ON NFA % 9,77 12.98 12.06 4.46 2.83 t.86 -0.22 1.50 2.27 0.06 2.83 7.96 WORKING RATIO % 58 56 34 33 34 26 8, 95 86 91 84 22 fRICE PEP CUBIC eETER P 1.21 1.20 1.cO 1.60 1.60 2.20 1.30 1.36 1.64 2,08 2.57 2.75 PHILIPPINES FIRST PROVINCIAL WATER SUPPLY PROJECT ---------- --- ------------------------------------------------------------------ NAME OF WATER DISTRICT: TARLAC 1977 1978 1979 1980 1981 1982 TOTAL 1977 1978 1979 1980 1981 1982 TOTAL STAFF APPRAISAL ACTUAL PERFORMANCE ----------------------------------------------------------- ------------------------------------------------------------ CASH FLOW STATEMENTS ( PESOS 000'S ) ( PESOS 000'S SOURCES: OPERATING SURPLUS 220 260 980 1590 2070 4000 9120 35 58 70 64 137 343 707 GRANTS FOR OPERATIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 INTEREST 0 0 0 0 0 0 0 0 0 0 0 0 0 0 MISCELLANEOUS 0 0 0 0 0 0 0 -11 7 -15 21 -25 B -15 --------------------------------------------- ------------------------------------------------------------ INTERNAL CASH GENERATION 220 260 980 1590 2070 4000 9120 24 65 55 85 112 351 692 EQUITY CONTRIBUTIONS 0 30 230 270 300 330 1160 26 1 1 0 0 0 28 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 0 DEFERRED CREDITS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 BORROWING 410 8850 11920 8800 8030 0 38010 823 1212 989 5173 12540 4882 25619 --------------------------- --- ---------- ---- - - ------ ------------ TOTAL SOUP^,ES 630 9140 13130 10660 10400 4330 490 873 1278 1045 5258 12652 5233 26339 APPLICATIONS: FEASIBILITY STUDIES 0 0 0 0 0 0 0 22 112 68 5204 12435 4717 2255 CONSTRUCTION 400 8460 11420 8410 6880 0 35570 652 1198 966 0 0 0 2816 CAPITALIZED INTEREST 10 430 1360 2290 3050 0 7140 0 0 0 0 0 0 0 OTHER2WORKS 0 0 0 0 0 0 0 158 0 23 42 100 421 DEBT SERVICING 20 20 20 20 20 3950 4050 12 14 16 17 94 314 467 WORKING CAPITAL 200 230 330 -60 450 380 1530 29 -46 -28 -61 81 102 77 EQUITYCONTRIBUTIONS 0 0 0 0 0 0 0 0 0 0 0 0 0 0 -------- ----- ---- ------- -- ----- ---------- ----- --------------- TOTAL APPLICATIONS 630 9140 13130 10660 10400 4330 48290 873 1278 1045 5258 12652 5233 26339 PERFORNCWE INDICATORS: DEBT SERVICE RATIO 1 11.00 13.00 49*00 79.50 103.50 1.01 2.25 2,92 4614 4.38 3.76 1.46 1.09 1.51 SELF FINANCING RATIO % 55 3 9 19 30 N.A. 26 4 5 6 N.A* N*. N,A* 25 P H I L I P P 1 N E 5 F .I ST P ROVINC IAL WATES SUPPLT FI P Oaj E - NAME OF WATER DISTRICT: TARLAC 1977 1978 197Q 1980 1981 1982 TOTAL 1977 1978 1979 1980 1Q81 198 TOA- STAFF APPRAISAL ACTUAL PERFORMANCE ---------------------------------------------- --------------------------------------------------- BALANCE SHEETS ( PESOS 000'S PSOS MS ASSETS: FIXED ASSETS 1810 1810 11900 34600 44530 44530 44530 1044 1156 1247 2250 3142 3513 3513 DEPhECIATION 910 140 300 890 1870 2990 2990 76 119 165 227 296 401 401 --------------------------------------------- ---------------------------------------------------------------- NET FIXED ASSETS IN OPER'N 1720 1670 11600 33710 42660 41540 41540 968 1037 1082 2D23 284 3112 3112 WORf IN PRORESS 410 9300 12000 0 0 0 0 0 0 7160 18746 23112 23112 CURRENT ASSETS CASH 70 310 590 490 890 1060 1060 33 38 10 39 112 173 173 ACCOUNTS RECEIVABLE - WATER 70 so 180 290 390 670 670 26 21 22 27 23 38 38 ACCOUNTS RECEIVABLE - OTHER 0 0 0 0 0 0 0 0 0 0 0 0 0 INVENTORY 10 10 10 40 60 70 70 19 16 30 23 20 162 162 OTHER CURRENT ASSETS 0 0 0 0 0 0 0 7 18 22 29 29 154 154 TOTAL CURRENT ASSETS 150 400 780 820 1340 1800 1800 85 ?3 84 118 184 527 527 DEFERRED ASSETS -FS STUDIES 0 0 0 0 0 0 0 697 1896 2861 0 0 0 0 SPECIAL DEPOSITS 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL OTHER ASSETS 0 0 0 0 0 0 0 697 1896 2861 0 0 0 0 - ------------------------ - ----------------. - -1 TOTAL ASSETS 2280 11370 24380 34530 44000 43340 43340 1750 3026 4027 9301 21776 26751 26751 EUITY AMD LIABILIES: EOUITY' CAPITAL 1670 1670 1670 1670 1670 1670 1670 3 940 941 941 941 941 941 CONTRIBUTIONS 30 60 290 550 850 1180 1180 0 0 0 0 0 0 0 RETAINED EANIOS 90 300 1100 2110 3190 2520 2520 -86 -78 -84 -79 -51 179 179 TOTAL EQUITY 1790 2030 3060 4330 5710 5370 5370 93 862 957 862 890 1120 1120 LIABILITIES: LON TERN LIABILITIES 450 9290 21200 29990 37640 37210 37210 823 2035 3024 8119 20360 24876 24876 CUOENT LIABILITES ACCO TS PAYABLE LWUA 10 10 20 40 50 70 70 0 0 0 0 0 0 0 ACCOUNTS PAYABLE - OTHER 0 0 0 0 0 0 0 22 53 60 117 66 143 143 CURRENT NATURITIES 10 to 10 20 390 420 420 0 0 0 78 299 288 288 OTHER CURRENT LIABILITIES 20 30 90 150 210 270 270 52 76 86 125 161 324 324 TGTAL CURRENT LIABILITIES 40 50 120 210 650 760 760 74 129 146 320 526 755 755 DEFERRED LIABILITIES 0 0 0 0 0 0 0 0 0 0 0 0 0 TOTAL EQUITY AMD LIAB'TIES 2280 11370 24380 34530 44000 4334 4334 1750 3026 4027 930 21776 26751 26751 PERFOATWC INDICATORS: VORKINS CAPITAL P ra 110 350 660 610 690 1040 1040 it -36 -62 -202 -342 -228 -228 CMRO T RATIO % 3.75 8.00 6.50 3.90 2.06 2.37 2.37 115 0.72 0.58 0.37 0.35 0.70 0.70 GEARIN;:LIABILITIES~ = 21 82 87 87 87 Be Be 51 7? 7? 91 96 96 96 ase � P1g �� � ti 61 es г г г11 ' ' 1е fq �аа ё1 Б( �� oai i � 19! 9Р I: д��� �g ( i 9F �$� 9!f Iь ��i Ii вs� � ! �i а� г, ь� �' е j; � а( д di � ;г � .,� PH1UPPINES PROMCM CMES WATER SUMY MJECT (LOAN NO. 1415: PHI) TYPICAL WATER DISTRICT Organk~ C~ Cle~ klo~ Sec~ cusk~sø~ Se~ C~ 0~ C~ -cc~ #ca ab - 73 - ANNEX 15 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT (LOAN 1415-PH) PROJECT COMPLETION REPORT Calculation of Economic Internal Rate of Return1/ 1. Capital Costs - Total project costs were distributed 3ver the period 1977-83 according to the annual investment in project given in WD financial statements, then deflated to 1977 constant prices. 2. Incremental Operating and Maintenance Costs - Were calculated by first deflating costs to 1977 prices, then subtracting 1977 (base year) costs from costs in subsequent years. 3. Incremental Benefits - As in the Appraisal Report, revenues were used as a minimal measure of project benefits, thus ignoring other non- quantifiable benefits, e.g., improved public health. Incremental revenues were calculated by subtracting 1977 (base year) revenues from deflated revenues in subsequent years. 4. The above data yielded the economic internal rates of return given in column 2 below. (1) (2) (3) Appraisal Completion EIRR EIRR Difference (%) (%) Baguio 10.7 4.6 (6.1) La Union 7.2 6.1 1.1 Tarlac 10.8 11.6 0.8 Cabanatuan 8.4 5.6 (2.8) Lips 9.4 -0.8 (10.2) Lupata 2.7 8.9 6.2 Mean EIRR 8.2 6.0 1/ All data used in these calculations were taken from an undated LWUA report entitled "Post-Project Evalualion: First Provincial Cities Water Supply Project." IBRD 12542 (PCR) 120. 12r 12 126 PHILIPPINES PROVINCIAL CITIES WATER SUPPLY PROJECT PROJECT CITIES aKid Project Cities Rodt .4--I--4-4--Railways Sento~ - -- - - Provincial Boundaries F n u Z N THIS MAP 1S BASED ON IBRD 12542, gt u FEBRUARY 1977. ONLY REGIONAL 16I- BOUNDARIES HAVE BEEN REMOVED 0, 50 100 Ir 20 Of re oc cbþUn KILOME TERS Mang -141- Lnas I2 ta Toclobon godo 10* 0° 0 Puerto Prencesa CoB CHINA TA WAN viV/AM edO Gi. santo$ Pvitt|PHANM V~maA~A& *e Us«ro ~ ~ ~ Vi4t NAM w M A L *Y$ IA / fr teudf.r ,ndis sichm,* tor fr smaul uos e ofl Thfrist sat fre h*leaone F-sr ac coporan en ?he dao nens wuo sedPW 00 Romie, shan en s me do nor m v »r part of ~he ~ ic mrB and fr hiiemaÉpna Feance Cororticerny g~geniw 01 fr toget sOlems et1 in eory0 « any endorsement er ccPtence ni 501 OomI05r INONSt94I2- 12r 1261 JULY 1984