Sri Lanka - Community Water Supply and Sanitation Project

.K (1 , ' (/ ( Document of The World Bank FOR OFFICIAL USE ONLY Re1cwr t. No. 10:1571- . Tv e : ( S P30 i t I : L? COMMUN I TYf Wf^iTEFR 'iJPPLY fNID /Out huIrJ- PLON fif r, ps Report No. 10571-CE ;. t: D I /Poo f: I' 0h2 be)nt .: 0t . f STAFF APPRAISAL REPORT SRI LANKA COMMUNITY WATER SUPPLY AND SANITATION PROJECT NOVEMBER 16, 1992 Energy and Infrastructure Operations Division Country Department III South Asia Regional Office This document has a restricted distribution and may be used by recipients only in the perforknance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENTS (As of July 1992) Sri Lanka Rupee (SLR) = 100 paisa US$1.00 = SLRs 44.0 SLRs = US$0.023 SDRs = US$1.44618 MEASURES AND EQUIVALENTS mm millimeter (1 millimeter = 0.039 inches) m = meter (1 meter = 3.28 feet) km = kilometer (1 kilometer = 0.62 miles) km2 = square kilometer (1 km2 = 0.368 square miles) ha = hectare (1 hectare = 10,000 square meters = 2.47acres) 1 = liter (0.22 Imperial gallons or 0.264 US gallons) led = liters per capita per day m3 cubic meters (220 Imperial gallons or 264.2 US gallons) ABBREVIATIONS ADB = Asian Development Bank CBO = Community-Based Organization CWSPU = Community Water and Sanitation Program Unit DANIDA = Danish International Development Agency DDP = District Development Plan FINNIDA Finnish International Development Agency GOSL = Government of Sri Lanka MHC Ministry of Housing and Construction MOH = Ministry of Health NGO = Non-Governmental Organization NWSDB = National Water Supply and Drainage Board OAP = Operational Action Plan PO = Partner Organization PPF = Project Preparation Facility UNDP = United Nations Development Programme FISCAL YEAR January 1 - December 31  FOR OFFICIAL USE ONLY SRI LANKA COMTfIY WATER SUPPLY AND SANITATION PROJECT STAFF APPRAISAL REPORT Table of Contents CREDIT AND PROJECT SUMMARY ... ..................... . iii I. THE RURAL WATER SUPPLY AND SANITATION SECTOR ............... 1 A. Sector Background .1.... . 1 B. Rural Water Supply and Sanitation Service Levels 2 C. Sector Institutions .....2 D. Sector Constraints 3. 3 E. Government Strategy for the Sector .5 F. External Financing of Rural Water Supply and Sanitation. ....... 6 G. Previous IDA Experience. 6 H. Rationale for IDA Involvement. 7 II. THE PROJECT ............................................. 7 A. Project Origin .. 7 B. Area to be Served .. 7 C. Project Objectives .. 9 D. Project Description .. 9 E. Proj ct Costs ..12 F. Financing Plan .... . ..... 13 III. ORGANIZATION AND MANAGEMENT ..14 This report is based on findings of an appraisal mission to Sri Lanka in February 1992, and a post-appraisal mission in June 1992. Project team members included Ms. Lea Donaldson (SA3EI) - Task Manager, post-appraisal and Mr. George Plant (EA2EH) - Task Manager, appraisal; Mr. Frank Mitchell (SA1EI); Mr. Mohinder Virdy (ASTIN); and Mrs. Janice W. Palenzuela (SA2i); Mr. Patrick McCarthy and Ms. Julie Viloria (Consultants); from the Internationtal Development Association; and Mr. Jens Bjerre (UNDP/World Bank Water Regional Group, New Delhi). The report has been endorsed by Messrs. Paul Isenman (Director, Country Department III, South Asia Region), and Per Ljung (Chief, Energy and Infrastructure Operations Division). The Peer Review team comprised Messrs. A. Wright, and A. Kennefick focussing on technical and financial elements, and Ms. A. Kudat, focussing on aspects of women in development and community involvement. Ms. Kim Pimenta (SA3EI) assisted in the production of this report. 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.  - ii IV. PROJECT IMPLEMENTATION .......................... .......... .. 16 A. Imarlementation Strategy.......... .. 16 B. Status of Preparation .. ... 17 C. Implementation Plan and Schdule . . .17 D. Procurement. ...... .......... . .. .21 E. Disbursements .......... . ............... 23 F. Accounts and Audit .. . .24 G. Monitoring, Evaluation, Supervision . . .25 H. Cost Recovery and Capital Contributions ... 26 V. ECONOMIC ANALYSIS AND ENVIRONMENTAL ASSESSMET .27 A.. Economic Ana l,is ...... ... ..................27 3. Environmental assessment . .31 VI. AGREEMENTS REACHED AND RECOMMENDATION . ...32 ANNEXES 1. District Development PlansP....#............................ 34 2. Detailed Project Description ...... ........................ 43 3. Outline of Terms of Reference: Technical Support Z'ell .. 50 4. Detailed Cost Estimates ... . ..................... 60 5. Organization Structure: A. Community Water and Sanitation Program Unit .... ..... 63 B. National Steering Committee and District Coordinating Coittees . .............. ................ .. . 64 6. Provincial and Local Administration: Table I - District of Badulla .......................... 65 2 - District of Matara ... ......................... 66 3 - District of Ratnapura .......................... 67 7. Project Review Pzocess ............. . .6....... 6 8. Community Level Project Cycle . .74 9. Potential Partner Organizations . .75 10. Implementation Plan and Schedule . .82 11. Scheme Selection Criteria .. . .83 12. Design Criteria ........ .87 13. Disbursement Schedule . .90 14. Project Monitoring Indicators . .91 15. Supervision Plan ......... . .95 16. Financial Statements . . ................................ 98 17. Economic Analysis Data ..... ................ 101 18. Environmental Aspects ....... .. .................... 105 19. Selected Documents and Data Available in Project File 107 MAP: IBRD No. 23635 - Community Water Supply and Sanitation Project: Districts of Badulla, Matara and Ratnapura  - iii - SRI LANA COMMUNITY WATER SUPPLY ARD SANITATION PROJECT Credit and Prolect Summarv Borrowers The Democratic Socialist Republic of Sri Lanka Beneficiaries: Community-Based Organizations (CBO) Non-Governmental Organizations (NGO) National Water Supply and Drainage Board (NWSDB) and Pradeshiya Sabhas (local governments) Amr-unt: SDR 16.9 million (US$24.3 million equivalent) Terms: Standard, with 40 years maturity Prolect Descrivtion: The project would serve the populations of the rural areas and small towns of the Districts of Badulla, Hatara and Ratnapura. It would comprise seven components: (a) program development, which consist of the following promotion activities: publicizing the project, assessing Partner Organizations (POs), mobilizing CBOs and assisting them to prepare and submit schemes for inclusion in the project; (b) water supply, construction and/or upgrading of water supply facilities to serve about 0.65 million people; (c) sanitation, construction and/or upgrading of low-cost sanitation facilities; (d) hygiene education to the benefited population; (e) training for POs and CBOs staff, and rural technicians on operation and maintenance of the systems; (f) project management for establishing and equipping the Community Water and Sanitation Program Unit and provision of funds to promote private sector participation in system maintenance; and (g) technical assistance for capacity building and studies. Benefits and Risks: The project would represent the beginning of a nationwide program to adopt the community-based approach for providing rural water supply and sanitation, giving communities more responsibility for the services provided, thus enhancing sustainability. It would improve women involvement in planning and operation and maintenance of the schemes which will allow a quicker response to problems, as well as improve the health of the targeted population, and reduce the time spent by women and children in carrying water to permit more productive activities. The main risks are that the institutional capacity will not develop fast enough to implement the project in the agreed timeframe, and the intermediary organization might not be provided with the  - iv - nocessary autonomy to allocate funds on the basis of the agreed criteria. The project addresses these risks by: (a) providing training and technical assistancs to the POs and recruiting appropriate staff in the project management unit; and (b) ensuring there is strict adherence to the agreed criteria for the selection of partner organization and schemes. Proiect Cost: Local Foreign Total US$ mtllion----- Program Development 0.7 0.1 0.8 Water supply 11.1 2.1 13.2 Sanitation 1.4 0.0 1.4 Hygiene Education 1.0 0.2 1.2 Project Management 2.0 0.6 2.6 Training and TA 1.7 4.0 5.7 Base Cost 17.9 7.0 24.9 Physical Contingencies 1.4 0.5 1.9 Price ContingencLes 4.8 0.7 5.5 Total Project Cost 24.1 8.2 32.3 Note: The above costs include an estimated US$1.5 million in t..zces and duties. Finc-'Cinx Plan: Government of Sri Lanka 5.5 0.0 5.5 Communities 2.5 0.0 2.5 IDA 16.1 8.2 24.3 Total Project Cost 24.1 8.2 32.3 .s= === ==== getimated Disbursements: IDA FY 1993 1994 1995 1996 1997 1998 1999 ---- ----US$ million---------------- Annual 2.4 1.7 3.4 4.9 5.8 5.6 0.5 Cumulative 2.4 4.1 7.5 12.4 18.2 23.8 24.3 Economic Rate of Return: 21.2Z (for water schemes) &2: IBRD No. 23635 - Community Water Supply and Sanitation Project: Districts of Badulla, Matara, and Ratnapura  SRI LANKA COMMUIT WATER SUPPLY AND SANITATION PROJFCT STAFF APPRAISAL REPORT I. THE RURAL WATER SUPPLY AND SANITATION SECTOR A. Sector Background General 1.1 Of the 199