Turkey - Bursa Urban Development

Report No. PIC4073 Project Name Turkey-Bursa Urban Transport (@+) Region Europe and Central Asia Sector Urban Project ID TRPA43365 Borrower Bursa Metropolitan Municipality Implementing Agency Bursa Metropolitan Municipality 16190 Acemler Bursa, Turkey Mr. Turgut Yalki Deputy Secretary General (90-224) 233 9885 (Tel) (90-224) 234 3749 (Fax) Date This PID Prepared April 24, 1997 Projected Appraisal Date Late June 1997 Projected Board Date February 1998 BODY of the PID: The minimum length of the PID is 2 pages. The PID must not include any confidential or sensitive material that could (a) jeopardize relations between the Government/Borrower and the Bank; or (b) adversely affect the integrity of the Bank's decision-making process. The updated PID may also include information, if feasible, regarding Project Benefits and Risks. Country and Sector Background 1 The city of Bursa is located some 20 km from the southern coast of the Marmara Sea and at the foot of the Uludag Massif, which rises steeply behind the city to a height of over 2500 m. The population, which past the million mark in the early 90s is expected to reach 1.4 million by the year 2000 and 2.0 million between 2010 and 2015. The city is a large industrial center, with over half of the population employed in manufacturing. In addition to traditional industries based on agriculture and textile, the city has attracted new industries such as automobile (90% of all cars made in Turkey), machinery production and food processing. The city is also a tourist attraction because of its rich historical past, being the first capital of the Ottoman Empire; its natural hotsprings; and its winter sport facilities on the Uludag, which is the best equipped in Turkey. The city shape is linear, following the southern edge of the fertile Bursa plain and perching on the foothills of Uludag. The population lives in three sub- municipalities: Yildirim in the East (37%), Osmangazi in the Center (579) and Nilufer in the West (6%). The city expansion is planned primarily in the West (Nilufer sub-municipality) along and between the Mudanya and Izmir roads; and to a lesser extent in the East along the Ankara road. Prime agricultural land in the North has been declared a "green belt" area, not for urban development, but illegal settlements are difficult to control.  Objectives 2 In addition to improvements now being implemented in the water and sanitation project (Loan 3565/66-TU), the Municipality has identified two priority development areas for which it is seeking Bank assistance: a) urban transport improvements; and b) completion of urban infrastructure in newly urbanized areas of Nilufer. The third priority identified in an earlier version of the PID -- gas distribution -- would be dealt with separately and a PID has been issued for a Gas Development Project. The objectives of this project will be: for urban transport, to mitigate and postpone the need for new high capacity transport investments in either roads or mass transit facilities by improving the use of existing infrastructure and efficiency of public transport; and for urban infrastructure, to minimize investment costs by rationalizing layout and designs and to increase the financial capacity of the Municipality. Description 3 The proposed project would finance: a) traffic and public transport improvements (Bursa central district traffic management, bikeway network, area traffic control system, integrated fare system, and computer hardware and software for transport sector activities); b) strategic roads development (Buski junction, inner bypass road east, from Yalova Road to Ankara Road, including three intersections requiring above grade construction and arterials in Nilafer); c) completion of streets of various width with sidewalks and storm water collectors in the Nilufer area; and d) technical assistance for long-range land use/transport planning and policy design/implementation in public transport regulation. Financing 4 The project cost is estimated at US$92.5 million equivalent, with a foreign exchange component of US$51.4 million equivalent (559) to be financed by the Bank. The remaining US$41.1 million would be financed by the Municipality of Bursa and the sub-municipality of Nilufer. Implementation 5 The project would be implemented by the Metropolitan Municipality of Bursa and the Nilufer sub-municipality. The Urban Transport Improvement Study and the Feasibility Study for Nilufer Transport Infrastructure Development, both financed by a Japanese PHRD grant, are about to be completed. A Project Management Unit will be set up shortly to carry on further preparation of the project, eventually continuing with the project implementation activities. Expressions of interest have been sought for consultants to prepare detailed feasibility, engineering and bidding documents for strategic roads development (para. 3 b) and a General Procurement Notice has been issued. Sustainability -2-  6 The urban transport improvements and the urban infrastructure components of the project will be dimensioned to be affordable both for investment and maintenance purposes in relation to the resources of the municipalities. To ensure sustainability, the project will support the following institutional initiatives: a) the creation of a Bursa Public Transport Regulatory Commission with appropriate staff to decide on the service network and frequencies, set fare policy, and sign up service agreements with operators; b) the setting up of the Bursa Bus Company (BOI) into an independent company to operate according to commercial principles, as a prelude to divestiture; c) the effective creation and appropriate staffing of a Traffic Management Unit to manage city traffic and parking, including the operation of the new Traffic Control Center to be financed under the project; and d) the improvement of registration of taxpayers and tax collection ratios among registered taxpayers. Lessons Learned from Past Operations in the Country/Sector 7 Bank experience in the urban sector in Turkey has been largely confined to water and sewerage projects, with the exception of the Cukurova Urban Project, which tried, rather unsuccessfully, to implement too many different components in five separate municipalities. In the case of Bursa, the project components are limited and were identified by the Municipality as their first priorities, therefore the risks of implementation have been mitigated. Poverty Category 8 NA 9 The environmental aspects of the project will be positive, and the project has been classified as "B" for the purpose of OD 4.01. The urban transport improvements will reduce traffic congestion and give priority to public transport over private vehicles, thus reducing air pollution. The surfacing of streets and installation of storm drains will considerably improve the quality of life of residents in the newly urbanized areas, which now have to negotiate very muddy paths to their homes after each rain. No resettlement is foreseen. Program Objective Categories 10 The Municipality is in the process of establishing neighborhood councils to ensure broad participation in decisions that will affect the life of the people. These councils will be involved with project preparation in the Nilufer area. Contact Point: Jacques Yenny, Task Manager The World Bank 1818 H Street N.W. Washington, D.C. 20433 Telephone No.: (202) 458-5454 Fax No.: (202) 522-1500 -3-  Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. Processed by the Public Information Center week ending May 9, 1997. - 4 -  Annex Environmental Environmental aspects of the project will be positive. Urban improvements will reduce congestion, give priority to public transport and thereby reduce pollution. Street paving will improve quality of life in newly urbanized areas. - 5 -