Liberia - Monrovia Urban Development Project

Document of The World Bank FOR OFFICIAL USE ONLY g W Report No. 3384-LBR STAFF APPRAISAL REPORT LIBERIA MOROVIA URBAN DEVELOPMENT PROJECT November 30, 1981 Western Africa Projects 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.  LIBERIA CURRENCY EQUIVALENTS US$1.00 = Liberian $1.00 The official monetary unit is the Liberian dollar which has a par value equal to the U.S. dollar. The U.S. dollar is legal tender in Liberia WEIGHTS AND MEASURES 1 meter (m) = 3.28 feet (ft.) 1 square meter (m2) = 10.758 ft 1 kilometer (km) = 0.62 miles (mi) 1 hectare (ha) = 10,000 square meters (sq. m.) 1 hectare (ha) = 2.47 (ac) 1 acre = 4,048 m2 = 43,548 ft2 1 liter (1) = 0.26 US gallon (gal) 1 cubic meter (m3d) = 1,000 liters or 264 US gallons 1 lcd = 1 liter per capita per day 1 m3/sec = 1 cubic meter per second 1 metric ton (m/ton) = 2204.6 pounds (lbs.) ABBREVIATIONS DDP Department for Development Projects in MCC GOL Government of Liberia LEC Liberian Electrical Corporation LWSC Liberian Water and Sewer Corporation MCC Monrovia City Corporation MCSS Monrovia Consolidated School System MLG Ministry of Local Government ML&M Ministry of Lands and Mines MPW Ministry of Public Works MUDP Monrovia Urban Development Preparation Team NHA National Housing Authority NHSB National Housing and Savings Bank PPF Project Preparation Facility of the World Bank USAID United States Agency for International Development FISCAL YEAR 1 January - 31 December  FOR OFFICIAL USE ONLY LIBERIA Monrovia Urban Development Project STAFF APPRAISAL REPORT Table of Contents Page No. I. BACKGROUND A. National Context ................................. 1 B. Monrovia .................................. 1 C. Government Initiatives ...... ............... 5 D. Bank Strategy .............................................. 7 II. THE PROJECT A. Objectives .............................. . 8 B. Components .................................. 8 C. Detailed Description ...................................... 9 III. IMPLEMENTATION A. Executing Agencies ............................... 22 B. Implementation Schedule ............................... 29 C. Procurement ................ ............... 29 D. Land Acquisition ............................... 30 E. Monitoring and Evaluation ............................... 30 F. Recurrent Costs ........................ 30 G. Supervision ................. ................ 31 IV. COSTS AND FINANCIAL FEATURES A. Costs ...... ........... ................ 32 B. Financing Plan ......................... 32 C. Disbursements ................ ................. 36 D. Cost Recovery/Affordability ............................... 36 E. Financial Impact on MCC ................................. 42 V. JUSTIFICATION AND RISKS A. Economic Analysis ....................................... 48 B. Risks ....................................... 49 VI. RECOMMENDATIONS ....................................... 51 This report was prepared by Mesdames/Messrs. D. Haldane, W. Meijer, F. Johnson, W. Doebele, R. Evans, V. Smith, M. McCarter, B. Hyatt, and P. Paka. 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.  -2- Page No. ANNEX I: Selected Documents on the Project File ..... ............... 54 PHOTOGRAPHS ....................................................... 56 CHARTS & TABLES Implementation Schedule ....................... (Table 22476).. 58 Schedule for Key Institutional Measures for MCC .(Table 22403).. 59 Institutional Responsibilities .................. (Table 22400).. 60 Organization Charts Monrovia City Corporation (MCC) ............ (Chart 22464).. 61 MCC Development Projects Department (DPD) ..(Chart 22465).. 62 Ministry of Local Government (MLG) ......... (Chart 22463).. 63 Ministry of Lands and Mines (ML&M) ......... (Chart 22466).. 64 National Housing and Savings Bank (NHSB) ..,.(Chart 22523).. 65 Financial Tables MCC Budgets FY78-FY81 ...................... (Table 22401).. 66 NHSB Financial Statements 1977-1979 ........ (Table 22402).. 67 MAPS & LAYOUTS Monrovia: Project Sites ........................ (IBRD 15578) Layouts: Sonewein .(IBRD 15580) Slipway .(IBRD 15579) Claratown ...........................(IBRD 15581)  I. BACKGROUND A. National Context 1.01 LiberiLa's overall economic growth, having been moderately high up to the mid-70's, slowed over the last five years. More recent annual GDP growth from 1975-1978 was 0.7% compared to 4.2% between 1970-74. Declining iron ore and rubber exports and heavy public outlays relating to the 1979 OAU conference in Monrovia are the main causes of this stagnation. As a result the current account deficit presently stands at US$96 million and external public debt at the close of 1979 was US$454 million. 1.02 Development has been characterized by an unusual degree of geo- graphical and social concentration. Income distribution is highly skewed with 5% of families earning over 50% of the national income. Open unemployment is estimated to be between 30-40%. Wealth is still largely concentrated in the hands of the former American population which migrated back from the USA to settle in Liberia in the middle of the last century. The situation has created long-standing tensions with periodic riots such as occurred in April and December 1979 and which culminated in an army coup on April 12, 1980. 1.03 The new military government faces a difficult, largely inherited fiscal and budgetary situation aggravated by the erosion of business confidence and the loss of senior personnel which followed the April change of government. These changes have seriously impaired project implementation capacity and accelerated the downward economic spiral in certain sectors. Government's Interim Development Plan, used to guide policy pending the expected completion of the five year National Development Plan later this fiscal year, has in- creased emphasis on projects which improve living standards of the rural and urban poor. 1.04 The country's financial problems are aggravated by unusually rapid population growth. Since World War II, Liberia has experienced increasing migration both from neighboring countries and internally from the hinterland to towns, especially the coastal capital of Monrovia. Nearly a third of the total population of 1.9 million live in urban areas, over half of which are in the capital. Monrovia's annual increase of about 7% has brought its population to about 330,000--over 15 times the size of the next largest town, Buchanan. If current trends continue, the city will double its population in ten years. Clearly Liberia-s major urbanization problems are occurring in the capital, which will continue to present the major challenge to urban growth management within the immediate future. B. Monrovia 1.05 Topography: Like many historic West African cities, Monrovia is perched upon a rocky ridge on the Atlantic Ocean, at the estuary of a major river--the Mesurado. For a rapidly expanding city, however, the topography  -2- is strikingly inappropriate and presents a major impediment to efficient urban growth. The built-up area extends in a narrow "L' shape along the north and southeast coastlines. Inland, an immense swamp obstructs further expansion. Newer settlements have begun to encircle the swamp. Oddly, central Monrovia has not responded to the growing shortage of well-located land with increased high-rise development as might be expected, nor have urban land prices yet shown any marked response. This is largely due to the city's unusual and complex land situation. 1.06 Land: Obstructions to land development in Monrovia including the lack of an active land market represents a major issue government will have to address if it is to effectively manage the city's growth. Good development land is already scarce--a trend which will intensify in the future. A more serious problem, however, is a pervasive lack of security of land tenure which is the result of the lack of a cadastral and ownership registry throughout Liberia. Although most land is privately owned, there is often a proliferation of conflicting deeds for the same or overlapping properties involving govern- ment, tribes, organized community groups, institutions, families and indivi- duals. Few early sales or transfers were formally surveyed or registered, and subsequent exchanges further aggravated the confusion. Being one of the few African countries never colonized, traditionally more relaxed tribally-based attitudes about land boundaries and ownership have prevailed longer here than elsewhere. 1.07 Rapid urbanization has begun to change these attitudes, but the lack of clear ownership of urban land has created a number of problems which are directly or indirectly affecting Liberia-s economic growth and the welfare of her population. It has prevented development of any effective system of mortgages, inhibited land sales and building construction, discouraged improve- ment and maintenance of existing structures, and undermined the establishment of an effective real estate taxation system. Property in Monrovia is rarely bought or sold and when it is, prices fluctuate dramatically. Even in the central business district most structures are inexpensively built and many are now old and dilapidated. llttle new investment is evident. Numerous older, half-built structures appear throughout the city --- particularly in central areas which are often reputedly the result of disputes over land ownership when one owner or the other began development. 1.08 Shelter and Service: The shelter problem in Monrovia is becoming increasingly severe and has no doubt been exacerbated by the uncertainties surrounding land ownership and tenure. At present it is estimated that over half the city's population lives in areas needing upgrading. In addition, over the next ten years 50,000 new units will be needed to keep pace with anticipated growth. 1.09 The lack of an effective housing finance system has been a major constraint to shelter development. As noted above, incomplete structures can be seen throughout Monrovia, representing collectively an impressive investment earning no return. Permanent materials of fairly high quality are not unusual in such buildings. Land ownership disputes only partly explain this phenomenon. A second major cause is the failure of families to utilize  -3- credit, who instead build as and when cash becomes available. The obvious inefficiencies of this system do not yet appear sufficiently punitive to have forced significant change. 1.10 To stimulate shelter production, the National Housing Authority (NHA) was created in 1970 to build public housing, and the National Housing and Savings Bank (NHSB) in 1972 to mobilize domestic savings and attract foreign investment, principally to finance private housing. Up to 1979, however, NHA had built only about 1,500 units, mostly for middle- and high- income households at unit costs ranging from US$7,000 (1974) to US$13,000 (1978) for lower to middle income and US$74,000 (1980) for upper income groups. Mortgage lending for the NHSB, which did not begin operations until 1976, have constituted only a small portion of its portfolio. Even commercial banks have been inactive in this sector. Only in 1978 did loans for private residential construction or improvement enter into commercial bank lending, with a little over 8% of total credit during that year. Insecurity of tenure and difficulty in purchasing land have frustrated these initiatives to develop a more effective mortgage system. 1.11 Informal housing has been built almost completely without credit, resulting in standards and materials well below what could actually be af- forded. Sixty percent of the city-s housing stock is of temporary materials. While the latter is by no means unusual in developing country cities, the lack of shelter finance appears to be more pervasive, affecting higher income groups and more substantial buildings, than in most other African cities. 1.12 While servicing levels vary considerably between settlements, most squatter areas have some services. Access and internal circulation is often by earth roads or footpaths. In high-density areas even pedestrian circul]ation is difficult because of the lack of a rational, well-defined pattern. Electrical service reaches nearly all settlements, several of which have over 90% individual service, a high proportion of which represent illegal connections. Security lighting, however, is almost universally absent and is considered a major contributor to the relatively high crime rates in these areas Most settlements are served with piped water, but the system is plagued by fluctuating pressures, illegal connections, and inadequate mainte- nance. Of the city's total water production, about half is lost from leakage and illegal connections. The few existing public standpipes are generally broken, exacerbating the leakage problem. Because queues are long for available standpipes, residents continue to use shallow wells for washing purposes and buy drinking water at exorbitant rates of about 8 cents per gallon--about fifty times the Liberian Water and Sewer Corporation's (LWSC's) official tariff rate. Consumption levels are low at such prices--the average household utilizing only about six gallons per day, mostly for drinking and cooking. Well contamination is extensive since the water table is high and most areas lack adequate sanitation. Faeces are discharged on the beach, in open areas, or directly into the swamp through the use of latrines mounted over the water. The existing sewer and drainage systems in the central area are frequently blocked and broken as a result of inadequate maintenance, and- lack secondary connection lines to service poorer areas. Heavy infiltration occurs throughout the system, overtaxing treatment facilities during the heavy  -4- rains. This problem is exacerbated by inadequate storm drainage. Occasional periods of high water create serious sanitation problems by spreading and further decomposing mounds of uncollected trash which result from the city-s irregular and infrequent service. A few communities such as West Point have well-organized internal collection systems, but they are frustrated by poor municipal service (see photos, pages 56-57). 1.13 Health and Education: The health problems arising from these condi- tions include a high incidence of hepatitis and endemic diarrheal diseases such as cholera, dysentery and typhoid. About 460 cases of cholera were recorded in 1979. The unrecorded actual incidence is probably much higher. The death rate for children under 5 is also particularly high, constituting approximate'ly 80% of deaths in the JFK Memorial Hospital in Monrovia; chronic malnutrition affects 15% of this age group. Malnutrition during pregnancy occurs in over 20% of all cases. 1.14 The low quality of education is one of the major educational issues in Liberia and stems primarily from extremely poor facilities, lack of suitable educational materials, furniture and equipment and the limited qualifications of the teaching force. In addition, many schools are housed in rented accommodation, often lacking adequate sanitary facilities, and are not suitable for use as schools. 1.15 Employment, Incomes and Urban Poverty: Unemployment in Monrovia is high and the informal sector accounts for a large proportion of all jobs. Estimates of the formal labor force participation rate range from 25-33%. Of the total 60,000 estimated jobs, government and public corporations account for over half. Perhaps another 18,000 jobs are being provided through the informal sector which would represent nearly one out of every four persons. Almost half (10,000) this group are market women. 1.16 As elsewhere, real incomes of a large proportion of the urban population have declined in recent years. About 50-70% of residents in low income settlements fall below the absolute poverty line of US$310 per capita per annum, or US$130 per household of 5 per month, the level at which an average family can just afford minimum caloric requirements. 1/ Government-s recent doubling of the minimum monthly wage from US$100 to US$200 is likely to result in the loss of an undetermined number of lower level jobs, which will further reduce overall incomes. 1.17 Administration: Many of Monrovia's problems are ineffectively dealt with because development is not well coordinated. The city lacks an overall development policy framework, and an integrated expenditure program and budgeting system. Over a dozen ministries and government agencies are 1/ Details on urban poverty are available in the Bank's 15 October 1980 report on "Monrovia Water, Power and Urban Projects; Analysis and Strategies for Improved Access to Services by the Urban Poor."' Figures have been updated to January 1981.  active, but their functions often overlap and responsibilities are not clearly defined. Development investment tends to take place through an ad-hoc process of independent ministerial decisions, with no articulation of--or adherence to--an hierarchy of priorities. Moreover, once facilities are built, no integrated machinery exists for determining priorities for allocating funds for their operation, maintenance or improvement. C. Government Initiatives 1.18 Government has taken a number of initiatives over the past five years to address some of the preceding problems. Municipal Government was restored in Monrovia in 1976 after over 50 years of dormancy, to begin to strengthen municipal management. The Monrovia City Corporation (MCC) is a public corporation and reports to the Ministry of Local Government. Govern- ment is in the process of defining the municipality's role and assisting it to develop the capacity to undertake its new responsibilities (see Paras. 3.03-3.10). 1.19 Land Registry: One of the most ambitious government initiatives was the introduction of a survey and ownership ("adjudication") registry begun in 1974 under a new Land Registration Act by the Ministry of Lands and Mines (ML&M) with UNDP assistance to replace the former deed system with a guaranteed title system legally defining plots and ownership of urban land. 1.20 The adjudication procedure involves two related, yet different tasks: cadastral survey (establishment of boundaries) and registration of owners. The process is initiated by the Minister for Lands and Mines peti- tioning the County Probate Court to declare an area ready for adjudication. Four areas have been so declared, including the project locations. Land owners are advised to bring their deeds to a special "Adjudication Unit" of the Probate Court. A "predemarcation period" of two months follows during which names of tentative owners are recorded and presumptive property corners are staked. Thereafter the formal "demarcation period" begins, which has no stipulated time limit. Presumptive owners are served with a formal Notice of Demarcation requiring that they appear. When, as often occurs, they don't, the teams attempt to organize informal hearings on the site which often successfully resolve minor boundary disputes. However, establishment of title is a legal matter which requires actual documentation and cannot be done informally, or in the field. Title, to be valid, must be traced back through a chain of documents to an original grant or sale from the state. Thus all land presumptively belongs to the state and the burden is on the individual to prove otherwise, or the state can reassert its residual title. Where boundary disputes cannot be settled in the field, conflicting deeds appear, or no records exist, hearings will be held by the Adjudication team. Thereafter, a Referee reviews the decision and title is entered in the new permanent record. The ML&M then officially surveys and prepares the final plat. In practice, adjudication is less a matter of legal process and technical expertise than skillful negotiation, persuasion and good judgment.  -6- 1.21 Predictably, a number of difficulties have arisen in the course of adjudicating the first area in Monrovia, which took nearly four years to complete. First, the adjudication unit, requiring an unusual professional collaboration between surveyors and lawyers, has presented something of a bureaucratic dilemma. Initially assigned to the Ministry of Lands and Mines it was later shifted to the Probate Court and then returned to the Ministry. However, since its functions and senior officers are judicial the unit has tended to be a low priority. 1.22 Lack of hardware and an adequate operating budget have severely hindered the unit's operations. Transport is particularly critical since the seven teams must work on-site for predemarcation activities. Numerous simple deficiencies such as the lack of concrete markers, measuring tapes and paper for the photocopy machine have sharply reduced the team's efficiency. 1.23 A second, equally serious problem is the inaccessibility of the existing deed archives due to a lack of indexation. Theoretically three copies are made of all deeds: the ownerIs original, one for the county court and one for the National Archives. In practice, however, county records are incomplete and contain only more recent registrations. The National Archives which are filed chronologically and are more complete, lack a grantee index since 1962. Thus to find a specific deed one must know the exact date of filing. Alternately one can leaf through the massive volumes in the hope of uncovering the document. The condition of the books shows a great many people have been forced to do exactly this and the resulting wear and tear is gra- dually destroying these important records. In short, the archives without an indexation system are effectively useless for title searches except at great cost in terms of time or money, creating a formidable obstacle to adjudication. 1.24 Housing and Upgrading of Services: A third major initiative begun more recently is the development of a large serviced site program implemented by the National Housing Authority and the National Housing and Savings Bank with USAID assistance. The project would provide between 1000-1400 serviced plots in the New Georgia and Barnersville area, together with community facilities and construction loans for self-help housing. Ground was broken on the New Georgia site in 1979 with 900 plots completed in February 1981. As part of the project, improvements are being made in the existing community of West Point. Community facilities are now under construction and servicing improvements are scheduled for completion by mid-year. Home improvement loans are included in the package along with about 36 completed units for rental. 1.25 Technical assistance complements the physical works, intended to expand the institutional capacity of the two executing agencies and to help government shape a national housing policy. The serviced site component of the ongoing project is designed to be affordable to the poorer half of the urban population and the upgrading will reach even the lowest income groups in the area affected. The program represents a major departure from the previous, higher-cost orientation of these agencies. 1.26 Work is also underway by the Liberian Electricity Corporation (LEC) and the Liberian Water and Sewer Corporation (LWSC), the two utility authorities, to improve service to the urban poor, financed under components of the BankIs Fourth Power Project (No. 1600-LBR) and First Water Project (No. 859-LBR). These improvements will complement those under the USAID-NHA program in West Point and reach a number of additional low-income settlements.  -7- A Sewerage Master Plan for Monrovia was begun in November 1980 financed by F KfW Germany, which should identify measures to reduce the heavy infiltration into the system and improve maintenance. Emergency maintenance works totaling about US$700,000 have already been initiated by LWSC. 1.27 Education: Government has been trying since the early 1970's to improve the quality of primary education through development of better facilities including equipment and furniture, provision of educational mate- rials, formulation of better curricula and expansion of the number of qualified teachers. The Bank has assisted in these efforts through the Second Education Project (No. 1266T-LBR) and is considering further assistance at the primary level through the proposed Fourth Education Project. 1.28 Employment: Improvement in job opportunities throughout Liberia has been a prime concern of government for some time and has led to a number of assistance programs, including a recently approved Bank-assisted IDF project (No. 1076-LBR) of US$5.5 million for small scale enterprises. Another US$1 million was approved as part of the USAID program for credit to the informal sector through the NHSB. Technical assistance and training schemes are included under both loans, and the Bank's Third Education Project has also been reinforcing vocational training. 1.29 A final area of major Government initiative in addressing urban sector needs has been the Monrovia Urban Study, carried out in 1976-1978. This study resulted among other things in the establishment of the Monrovia Urban Development Project Preparation Team (MUDP). The latter's report of February 1980 is the major feasibility study input for the present proposed Monrovia Urban Development Project. D. Bank Strategy 1.30 The Bank has supported these various government initiatives in urban areas through a series of sectoral loans in the fields of water supply, electricity, industrial development and education described above. The pro- posed urban project would represent the first in this sector and is intended to complement and strengthen these ongoing programs (para.2.02). Perhaps more important, it will help establish key elements in the overall urban framework essential for rational management of urban growth and more efficient use of Liberian resources--both human and financial. The complexity and close link- ages of the problems described in this chapter makes Liberia a particularly difficult context in which to work. In response, the project has been pared back during preparation to reflect basic concerns. Land adjudication and registry, improvement in revenue collection on the property tax, and strength- ening of the municipal institutional structure including its revenue base represent longer term objectives which are essential cornerstones on which an urban management capacity can be built. Upgrading existing services in local neighborhoods will give the City a challenging yet manageable task which should begin to strengthen coordination among the various agencies engaged in urban development and place these activities under a unified policy framework. Thus the urban project is designed to begin to plug key gaps in the urban environment and set the stage for more effective overall management of Monrovia-s future growth.  -8 - II. THE PROJECT A. Objectives 2.01 The project has three major objectives: (a) improvement in living conditions of the urban poor; (b) strengthening of municipal management, including development of a delivery system for upgrading at the municipal level, and improvement in the city's revenue base; and (c) strengthening of property tax collections requiring establishment of a land ownership registry in Monrovia. B. Components 2.02 This first urban project in Liberia will focus primarily on Monrovia and contains three major components: upgrading, land adjudication, and institutional development. Altogether, the project will touch the lives of about 100,000 people representing approximately 30% of the city's total population. About half the target group falls below the urban poverty threshold. Upgrading will reach 70,000, the first phase of adjudication an additional 30,000, and the city-wide adjudication a much larger number. The project's components and costs including all contingencies are summarized in Table II-1. Recent USAID-NHA experience in this sector (para.1.24) has helped shape this project in several ways. First, since an extensive serviced site program is under implementation by NHA, none is proposed under this credit. Upgrading, however, initiated in one or two areas under both Bank and USAID financing, will be expanded to nine additional communities. Completion of the land title registry also represents an important contribution toward the development of an effective mortgage system and the gradual relief of Monrovia's seriously obstructed flow of housing finance particularly at A lower-income levels--a major objective of the USAID-NHA project. Finally, strengthening of the property tax collections will build upon the USAID- assisted property valuation exercise underway by the Ministry of Finance.  - 9 - Table II-1: Component/Cost Summary US$ 000 X Total Cost UPGRADING COMPONENT Infrastructure Services Roads, Footpaths, Drainage 1,885 14 Water and Sewerage 1,925 15 Wet Cores 577 4 Security Lighting 110 1 Compensation 283 2 Community Facilities 2,315 17 House Construction Loans (Resettlement) 137 1 Refuse 631 5 LWSC Standpipe Extension Program 833 6 Aerial Photography/Mapping 120 1 MCC/DPD Salaries/Operations 1,008 8 Sub-Total 9,824 74 LAND ADJUDICATION Phase I: Project Areas 463 4 Phase II: City-Wide 1,464 11 Sub-Total 1,927 15 INSTITUTIONAL DEVELOPMENT Training 138 1 Studies 670 5 Technical Assistance 328 2 PPF Advance Repayment 450 3 Sub-Total 1,586 11 TOTAL 13,337 100 C. Detailed Description UPGRADING COMPONENT 2.03 Improved services involving a package of water, sanitation, roads, drainage, refuse, security lighting and community facilities will be provided to Claratown, Sonewein and Slipway, three settlements in Monrovia containing about 25,000 people. Another 5,000 people will be added through infill plots in Claratown. In addition, extension of LWSC's standpipe program will provide improved water service to another 40,000 people (para.2.20). No house con- struction or improvement loans are proposed other than those for essential  - 10 - resettlement because the pervasive lack of established land title prevents property being used as collateral. The DPD-s operations are included totalling about US$1 million of which about 70% represent salaries, 22% operations and 8% equipment. A. Selection Criteria 2.04 The three settlements were selected for their large populations and poor living conditions, and also to provide a mix of settlement types to give MCC varied experience. At least one area offers a reasonably clear- cut land ownership situation which will facilitate project start-up. A final criteria involved the interest of the community in upgrading and their willingness to undertake financial responsibility for cost recovery. The resulting combination includes the two dense, centrally-located settlements of Sonewein and Slipway, and one--Claratown--located on Bushrod Island. 2.05 All three share a need for services, though for different reasons. Claratown, being a newer, rapidly growing area of about 7,000 people is largely without services. Sonewein and Slipway, with populations of 11,000 and 7,000 respectively, are older areas with some services but which are severely deteriorated and in need of repair or replacement. Sonewein is particularly in need of attention. A major sewer line draining 30 ha above the area is blocked and currently discharging large quantities of raw sewage (see photos, pages 56-57) into the community. Water from the high proportion of broken taps on the few public standpipes in Sonewein which run day and night combine with stormwater runoff to wash this sewage throughout a large part of the settlement, creating a severe health hazard. Monrovia's endemic cholera problem is no doubt exacerbated by such conditions. Slipway is without waterborne sewerage, and most families use toilets overhung on the Mensurado River. 2.06 A second feature shared by the two central settlements is a high incidence of rental accommodation, representing approximately 48% of respon- dents in Sonewein and 43% in Slipway. Some of this is subletting of rooms by owner-occupiers, but the majority appears to be absentee landlords which affected project design. Rents are expected to rise somewhat as a result of pass-throughs of the new property tax charges in squatter areas applied toward recovery of project costs (para. 4.09). However, to minimize the risk of sharp rent increases beyond legitimate pass-throughs of costs arising from project improvements, a component has been added to extend LWSC's ongoing program to improve water services in other squatter areas throughout Monrovia, and standards have been kept minimal (see para. 5.14). The project intends to monitor these anticipated rent increases. B. Layouts and Servicing Standards 2.07 Maximum use is made in all layouts of existing infrastructure with the result that very little demolition will be needed. Road reserves will be adjusted in Slipway to accommodate the rather narrow existing access. Cipen space exists in all areas for community facilities, and sufficient land is available in Claratown for "infill" plots to accommodate families that must be moved to make way for services.  - 11 - 2.08 Design standards reflect the constraints of affordability, existing physical conditions (high water tables, rock outcrops, heavy rainfall and unavoidable flooding, etc.), and the desire to keep standards simple to avoid the rent increases noted above. Priority has been placed on provision of (a) water and sanitary facilities, (b) drainage, access roads and solid waste disposal, and (c) power and community facilities, in that order. Proposed servicing levels are set out below. Standards and level of services are largely consistent with those under the NHA-USAID project (para 1.24). 2.09 Roads, and footpaths: major access roads and drainage will be improved in all three settlements. Essential footpaths such as those to sanitary wet cores will also be included. Road standards reflect Monrovia-s heavy rainfall of over 200 inches per year, 90% of which falls during a six- month period. Because of this and the likelihood of reduced maintenance over the next few years due to Liberia's tightened economy, a double seal and chip finish will be provided on all improved roads and major footpaths. Carriage- ways/rights-of-way for local distribution and secondary access roads will be 5.5m/10m and 4-5.5m/8m respectively. 2.10 Drainage: open channel stone-pitched drains will be provided along one side of all roads and major footpaths, connected to main drainage outfalls located on site. These will generally be open cut trapezoidal drains with a base width of 0.5m and 450 slope. However, parts of lower Slipway and most of Claratown cannot be drained properly within reasonable cost limits because of their location along the Mensurado River and Stockton Creek in low-lying swampland. About 30% of the Claratown site is below the level of Stockton Creek during the rainy season as a result of families reclaiming swamp for building sites, utilizing local fill material. While this is a cost-effec- tive method of land reclamation when done by self-help, major landfill through the project would be prohibitively expensive. For these areas, an approach which is common under such circumstances will be taken of providing filter material beneath the roads and major footpaths to allow seepage, and prevent the influx of Stockton Creek into the site. No effort will be made to drain or fill reclamation areas. This task will be left to self-help. Periodic flooding will therefore continue in the event of a major 15-25 year storm significantly raising the river level until the self-help landfill task is complete. 2.11 Sanitation: population densities, the high water table in Claratown and lower Slipway and rocky ground conditions in Sonewein and upper Slipway preclude typically lower-cost sanitation solutions such as aqua privies, septic tanks or pit latrines. Waterborne sewerage is therefore considered the only practical sanitation solution. On-site pipes have been sized for 100% future individual connections and a peak flow ratio of 2.5 plus an allowance for infiltration. The minimum pipe size of 225 mm should ensure blockages are infrequent. 2.12 Centrally located wet cores will be provided, each containing 12 toilet units with individual access and lockable doors, shower facilities and water standpipes nearby. These facilities are not designed for communal, public use. Instead, it is intended that each toilet will be used by approxi-  - 12 - mately 10 designated households occupying about five houses (50-75 people). It is estimated on the basis of a small spot survey that perhaps one out of five households in Slipway and Claratown and a majority in Sonewein may have private illegal sewer connections, reducing the population sharing each facility. Final designs will reflect the extent of private connections which has been recently established by LWSC through block mapping. Existing public facilities will be upgraded as part of the program. Provision has been made for about 12 wet cores in Claratown, 8 in Slipway and 11 in Sonewein. Wet cores will have direct road or footpath access, which is expected to facili- tate better maintenance (para. 3.36 ). 2.13 Trunk infrastructure is generally available since project sites are centrally located. Provision has been made for a 36" sewer line in Sonewein to replace an old one of 24" built in 1956 which is blocked, and two small pump houses in Claratown and lower Slipway with a short link (220m) of rising main in the latter. 2.14 Overall, the project will reduce sewage flows by reducing infiltra- tion. Initially extra sewage generated by additional toilet facilities in upgraded areas would increase present flows by about 1%, net of infiltration. Manholes will be wrapped and push-fit rubber ring joints used on all pipework to minimize infiltration. However, the replacement of the existing 24" sewer in Sonewein proposed under the project will more than counterbalance this marginal additional flow. The old Sonewein/Bushrod Island pipe and manhole network is considered the primary cause of existing infiltration, representing about three quarters of present wet weather flows which create an overload on treatment facilities. Replacement of the Sonewein line will reduce sewage flows by at least 15%, easing the present over-burden on treatment facilities. 2.15 Water: public standpipes with four taps each are provided for near each of the proposed wet cores. However, as part of the Tariff Study (para. 2.46) an assessment will be made of the feasibility of individual (yard) connections in view of the results of LWSC's block mapping of illegal connections before final designs are developed. Pipes are designed for a future use of 75 lcd and allow for 100% eventual individual connections. At project completion, usage is expected to be approximately 25 lcd, which will result in an increase of less than one half of one percent (0.4%) in bulk demand. Works are-underway through the ongoing water project to expand the overall supply which is expected to be completed by this time. Fire hydrants will be installed with flow capacities of 16 1/sec at all times including peak flow periods. Pipework is therefore at least 100 mm diameter up to the fire hydrant and kiosk locations. Only two trunk facilities will be needed; one elevated reinforced concrete storage tank in Claratown, and a short connection in Slipway to the existing main. 2.16 Power: Since the capacity of the existing high voltage power lines in each of the three sites is more than adequate, and most families already have connections, many illegal, only security lighting will be provided under this project. Lamps will be installed on existing poles along access routes and provision has been made for additional poles and lamps for footpaths and wet cores.  - 13 - 2.17 Solid Waste Disposal: eleven concrete refuse collection points would be provided along major roads as an extension of the existing system. Trash cans would also be provided. The major problem, however, lies in the irregularity of city collection services. To improve these, four additional collection vehicLes, three loaders, and equipment for the maintenance garage will be supplied. A brief study will be done under the Project Preparation Facility (PPF) advance to review the present system of refuse collection including the type of refuse, the collection system, type and number of vehicles, location of dump sites, adequacy of current fees, and in particular the vehicle maintenance operations. The study will make recommendations on ways of improving this service, particularly in respect to maintenance of MCC equipment. Terms of reference have been agreed and the study should be completed by the end of 1981. C. Resettlement 2.18 Resettlement of households in the pathway of services is expected to affect less than 2% of all structures. Those affected including renters would be eligible for building plots in Claratown or perhaps New Georgia, but priority would be given present houseowners. Tribal leaders have agreed that tribal land in Claratown would be utilized first for resettlement. If addi- tional land is needed the United Methodist Church indicated at appraisal its willingness in principle to offer long-term leases on building plots. The proposal is to be presented to their governing board this spring. A third alternative is also available from the NHA which indicated its willingness to offer plots in the New Georgia site and service area, which is under construc- tion and should be ready by the time needed. Since resettlement needs are quite small and any one of the three alternatives would provide ample plots, land availability is not expected to be a problem. 2.19 Compensation will be paid houseowners for demolished structures, in accordance with government's existing policy, as well as for land when clear title can be established. The compensation policy has been reviewed and found acceptable. Problems have been encountered in the past, however, with extensive delays of up to several years in payment due to disputes regarding ownership of the house and/or land and the procedures required by law for compensation. Although a 15% "dispossession" allowance is paid, structures are depreciated by 10% and the government valuation tables are set relatively low. Sometimes the amount paid has been inadequate to replace the dwelling. To ensure adequate funds for construction of replacement dwellings, US$137,000 is included under the project for house loans averaging US$3,500 per household. These funds will be lent by NHSB in accordance with agreed lending criteria (para. 3.24), and with the additional stipulation that the compensation payment when finally received may be applied to reduce the loan amount to the difference, if any, between that payment and the dwelling's replacement cost. Any funds remaining when houseowners have been resettled will be used to extend loans to renters wishing to develop a new plot. It: was agreed at negotiations that the compensation policy for land and structures applied in project sites will be satisfactory to IDA.  - 14 - D. LWSC Standpipe Program 2.20 About US$833,000 will be provided to the Liberian Water and Sewerage Corporation to continue their standpipe improvement program in low-income settlements, begun under the last Bank-assisted water project. Six settle- ments will be affected: South Beach, Douala, Jamaica Road, I.C.A. Camp, Bishop Brooks, and Badio Sidewalk. No other improvements will be made in these areas under the present project. E. Community Facilities 2.21 Primary Schools: one new primary school will be provided in Clara- town and one existing school in Slipway will be upgraded with sanitary facilities. In Claratown the primary school is housed in an overcrowded and rented church building which has neither water nor sanitary facilities (see photos). Essential equipment and furniture will also be provided in these schools and the existing school in Sonewein. Standards for construction and equipment will be the same as those under the Bank's Second Education Project (No. 1266-LBR), with unit costs of US$360 per pupil place. See para. 3.37 for staffing, operation and maintenance arrangements for all community facilities. The project will not affect the level of primary school space provision in project areas; attendance averages 66% of the estimated 6-11 year old population. The Bank's Fourth Education Project will address the upgrading of the quality of education and further expansion of access to rural primary education. 2.22 Health Facilities: A new 20 bed community health center and three health units will be built and necessary equipment provided. The center, which will be located on Bushrod Island in the New Kru Town area, will serve the large low income population of approximately 110,000 in this area, and will relieve overcrowding of the existing JFK Maternity Center which is currently operating at over 150% of capacity. It will offer emergency services for the growing industrial sector being established in this area which has very poor access to mainland facilities (see map IBRD 15578). Services will also be offered in maternal and child health care including normal maternity deliveries, nutrition rehabilitation and education, inpatient care for children, and outpatient care for the community as a whole. The Center's Community Health Department will supervise the staff of the local health units and offer similar services in their own immediate vicinity. The health units will provide nutrition education programs, family planning services, prenatal assistance and immunization services as well as treatment of minor ailments and referrals for more complex cases. Close liaison will be maintained with the project's field personnel who will initiate a modest and brief hygiene education program related to sanitation improvements under the project. This program will ultimately be shifted to the health unit personnel. 2.23 Markets: One new market will be built in Claratown and the exist- ing Rally Time market in Sonewein will be renovated and expanded. A brief study under the PPF Advance will help MCC review its overall market policy and the suitability of its current market fee structure. Terms of reference have  - 15 - been agreed and the study will be completed by the end of this year. As part of the Rally Time renovation, a small day care facility will be provided for the market women's use, for which daily fees will be charged. On both markets covered selling areas will be provided along with limited office/ storage space and open paved areas. Sanitary cores similar to those for primary schools will be built and the refuse removal service will be improved. Furniture and equipment is typically provided by the vendors except for washable concrete counters for the meat and fish areas which are included in construction costs. 2.24 Community Centers: one center will be built in each upgraded area which will contain office space for the project's field team and community leaders, as well as space for community meetings. Essential furniture will also be provided. Eventually construction field teams will move on, and on-site collection officers may take over the space. Sanitary facilities will include enclosed office space and a covered area for meetings. Construction materials are similar to those of primary schools. LAND ADJUDICATION COMPONENT 2.25 To begin the process of delivering reasonable security of tenure to residents in upgraded areas, the major bottlenecks in government's ongoing land adjudication exercise outlined in para. 1.07 must be removed. The adjudication component of the project will provide support to address the anit's lack of equipment and provide some technical assistance to help further streamline the adjudication process. Assistance will be broken down into two phases: the first focusing immediately on project sites, followed by con- ti-nuing support for the Monrovia-wide exercise. A. Phase I 2.26 Focus: Phase I, initiated with PPF funds will establish land ownership in the three project areas we well as the USAID-assisted West Point Settlement. 2.27 Tenure: the existing tenure situations in the three proposed sites are quite different, and each will require rather separate treatment. Clara- town offers the most promising situation, involving the fewest claimants. Gnly four landowners are involved in the area totaling 60 acres or 24 ha, each claiming large parcels of over 12 acres. One 21.7 acre plot owned by the Ulnited Methodist Church (UMC) and an adjoining 12.5 acre parcel in private hands appear to have undisputed title. Much of this land is still undeveloped, and could be used for resettlement purposes. The Church is likely to contri- bute land for community facilities and offer long-term leases on the rest for residential use (para. 2.18). Servicing would, of course, considerably enhance the value of the land. One section of the area between these plots and Stockton Creek is occupied by the Vai tribe and another closer to the river by the Kru and Grebo. These tribal groups allocate building sites through separate committees organized for this purpose. Both the Kru/Grebo and Vai tribes trace their title back to a document issued by government in 1888 granting ownership of 25.8 acres to "the Baisee and Hawa Ghai tribes and  - 16 - the residents of Fanima Town, their heirs, executors, administrators and assigns ... forever." This deed has already proven sound in an extraordinarily complex 1979 litigation to defeat a challenging claim by a private individual. However, it is not clear which, if either, of the two groups are the legitimate successors of "the Baisee, Hawa Ghai," ... etc. referred to in the decree or whether both may be. Appeals have been made to government to resolve the dispute. 2.28 A second land issue in Claratown is the Kru/Grebo claim to additional swampland which they have gradually been filling for homesites. Aerial photo- graphy was last done in 1975 and so the exact quantity of such land is unknown. Being originally river swamp, title would lie with government. The tribal group wishes to acquire the land either through squatters rights or purchase. Aerial photography of all Monrovia and mapping of project areas will be completed as part of the project. Final designs will take account of these extensions. 2.29 Overall, however, the tenure situation in Claratown is relatively straightforward. When the amount of landfill is established, assuming the tribal claims can be resolved, individual tenure can be arranged. Several options exist: long-term leases on church or private property, and in tribal areas either communally held land, long-term individual leases or fee-simple titles which would be possible if the tribes were to incorporate. The tribes are anxious to resolve the dispute and have indicated their willingness to work together under one umbrella organization to achieve their objectives. Phase I of land adjudication will settle land ownership questions and there- after a pilot attempt will be made here to deliver tenure to houseowners. 2.30 Sonewein presents the most difficult area for tenure delivery. It consists of about 350 parcels of centrally located land varying greatly in size. The largest landowner is government which controls the stadium and market areas, followed by the African Methodist Church (AMC), which claims an area containing about 40 houses, covering 10% of the project area. Only two large private plots appear, one with about 20 dwellings. Altogether, these four claimants represent less than a third of the total area. The remaining two-thirds are small individually owned parcels. 2.31 The AMC land is already under dispute. Residents allege the Church has no deed to the 40 lots on which it has given 33-year leases, 13 years over the legal maximum. 2.32 Slipway has many similarities to Sonewein, particularly in its high proportion of individual owners and absentee landlords. The area totals about 15 ha. Although small and reasonably well organized, the community has made no collective effort to date to dispute ownership or buy the property or to alter the current rental arrangements in any way. Most property leases--as elsewhere--are verbal. 2.33 In both Slipway and Sonewein land ownership will be largely estab- lished under the project through the adjudication process. House ownership and room tenancies will be left undisturbed. No attempt will be made to alter  - 17 - the absentee landlord nature of many rental arrangements on both land and houses because the political sensitivity as well as legal and administrative complexity of such an exercise is well beyond the scope of this first project. 2.34 The West Point area will also be included in the first phase of adjudication, since upgrading has been initiated in this area by NHA including house improvement loans for which title deeds will be required by NHSB. Uncertainty exists as to whether West Point is government-owned as a result of the previous government-s 1977 declaration of the settlement as a "disaster area," or whether various private claims and deeds are still valid. The adjudication exercise will resolve questions surrounding current ownership and will help government focus on what type of tenure--if any--they wish to offer West Point residents. Delivery of such tenure instruments, however, is not within the scope of this project. 2.35 Schedule: Phase I is expected to take at least two years (Table 22476), and was initiated during project preparation. If claimants cannot be brought into agreement by the adjudication team, some litigation may continue thereafter, but demarcation, survey and title recordation should be substan- tively complete by the end of 1982. 2.36 Elements: Phase I will provide assistance to the survey/adjudi- cation work, and the indexation of the archives--both essential to the project's completion. Vehicles will be acquired to mobilize the seven teams and the referee, and field equipment will be provided. Additional office accommodation will be included along with essential office equipment, and a publicity allowance for TV, radio and newspaper advertisements to reach landowners. Salaries and operating costs are also included. The equipment and operating materials total only US$180,000 or less than 40X of the total cost of the first phase, and will serve the teams throughout the Monrovia-wide exercises, The remainder represents salaries. It is anticipated that the pace of adjudication will pick up considerably as a result of these fairly minor, but important inputs. B. Monrovia-wide Adjudication 2.37 Focus and Schedule: upon completion of the first phase, assistance will be continued for another three years through the project's completion in mid-1985 to expedite land adjudication throughout Monrovia. The second major area has just been initiated. Most low-income settlements which would be eventually upgraded as part of a continuing sector-wide program will be addressed under this exercise. A targeted timetable is shown in Table 22476, but actual completion dates depend on numerous unknowns including public cooperation and are not possible to accurately predict. Assistance would terminate in a straightforward manner with the projects closure, but might be continued, if needed, under subsequent urban projects. 2.38 Elements: as noted above, much of the essential equipment needed by the seven adjudication teams is provided under the Phase I. Salaries and operating costs will be continued as well as publicity and essential field equipment such as demarcation markers and concrete monuments. A micro-  - 18 - film machine for the archives is included in this second phase with a printer- reader capable of producing copies in a few seconds. This will eliminate the present time-consuming and laborious manual typing of individual deeds, as well as the need to leaf through massive volumes of original deeds to locate documents (para. 1.23.). Of the total component cost, equipment and operations represent a minor proportion (less than one quarter) but will make a major difference in the efficiency and output of the teams whose salaries comprise the rest. 2.39 In addition, technical assistance will be provided to deal with several tough procedural problems which have arisen and to help ensure adequate maintenance arrangements. The first, outlined briefly in Chapter I, is the difficulty of motivating landowners to cooperate in the adjudication exercise. This is perhaps the most serious obstacle encountered to date. Poorer households, being economically insecure and often illiterate, feel threatened by the process and are fearful participation will result in the loss of their most valuable possession--their land. Competing deeds often appear that were previously unknown. If litigation ensues, legal costs may be prohibitive placing the poorer family at a distinct disadvantage in contesting the challenge. Even if uncontested, the original deed may have been lost, necessitating an extended search for deed documentation. Rich and poor alike recognize that adjudication will lead to stricter enforcement of property taxation, which is now largely ignored. Payment of up to 5 years' back taxes is, in fact, required to obtain clear title. The inability or unwillingness of many families to pay these sums is partly responsible for the large proportion of Area One plots which have not completed the adjudi- cation process. These various fears and uncertainties often outweigh the dubious merits of having a "clear" title, especially for families who have been enjoying undisputed control of their properties for many years without government intervention. 2.40 The most effective means to address this motivational problem is for government to assert its residual claim to properties for which no claims have been established during adjudication by "closing" the area. Provision has been made in the 1979 law to "close" an adjudication area after the work has run its course. Thereafter claimants have an additional 6 months to file before the property formally reverts to the state. So long as areas are never closed, many owners have no particular reason to cooperate and a number of good reasons not to. In an effort to revitalize the adjudication work, the new government closed the first area in September--five years after it was initiated. This step represents a dramatic and important statement of support without which the adjudication exercise might well prove futile. During negotiations it was confirmed that government will continue to close adjudication areas in a manner acceptable to IDA after all reasonable efforts have been made by the adjudication team to complete the area and residents have been allowed a reasonable period for response, and that government will reassert its residual title to any unclaimed land. 2.41 A second difficulty is what is termed the "grandfather-s deed" problem. This problem arises where deeds have been passed down from previous generations who initially purchased the property, but who have since died.  - 19 - To the f-amily, undisputed possession of the property backed up by the care- fully preserved original deed is clear proof of their rights. Legally, however, it is not. Deeds written in the name of a parent or grandparent do not bestow rights upon the children or grandchildren unless some form of probate has occurred establishing the children as proper heirs, and a new deed has been issued in the childrens names. Poorer families rarely have bothered with such court proceedings which are made considerably more difficult and complicated by probate procedures. Even assuming an adminis- trator can be found, probate requires the present landowner to somehow establish the fact that he/she is a legitimate descendant of the original owner. The general lack of birth certification in Liberia usually makes this impossible, bringing the adjudication effort to a halt. Thus, even if the ' family 4s motivated, completing the formal process to obtain clear title is a complex obstacle course and requires streamlining. The technical assistance team will develop proposals for such streamlining. 2.42 A third matter requiring the attention of the technical assistance team is the eventual impact of the rental tax on shelter costs particularly for tenants in dwellings with absentee landlords. While not an immediate problem since several years will be required just to establish land ownership, an assessment is needed of the likely impact including a recommendation on whether an adjustment might be needed in this law to ensure the adjudication does not eventually displace residents in project areas. INSTITUTIONAL DEVELOPMENT COMPONENT 2.43 This component will focus on strengthening MCC to implement the project and on assisting the City to develop the municipal management capacity needed to carry out its assigned functions. In addition, a small unit will be developed in the Ministry of Local Government to supervise the MCC operation and begin shaping similar urban upgrading and development programs in some of the larger towns throughout Liberia. A Training 2.44 Training is a key element of the institutional strengthening program. Most of the training effort will be directed towards MCC, MLG, NHA and the ML&M. Liberian or West African institutions will be used wherever suitable. Selected staff requiring specialized training may attend short courses abroad or experts may be brought in to organize and teach courses in Liberia. Approximately 74 people are expected to participate, 13 from the MCC's new department (DPD), 10 from the MCC's general operations, 9 from MLG, 8 from NIIA, 6 from ML&M and about 4 each from the Ministries of Finance, Planning, Education and Public Works, the NHSB, LEC and LWSC. Nearly all will be professionals; about 60 managers, 8 planners, architects or engineers, 2 lawyers, 2 accountants and 1 traffic engineer plus 1 health worker. Training proposals, summarized in Table II-2, total about 72 staff-months.  - 20 - Table II-2: Training Staff Topic Description R4onths Urban Short courses on upgrading and low-cost housing (serviced sites) Growth programs and other topics related to municipal management (2 persons for 3 months each course) 6 Study tours to review similar projects in Africa (2 trips for 3 people each for 2 weeks) 3 Traffic Short course abroad on traffic management (1 person for 3 months) 3 Management Seminar on project management skills to be held in Liberia Skills (time management, delegation, supervision, motivation, team conflict, etc.) (2 seminars for 30 people each, 1 week duration plus 1 week follow-up=60 participants) 15 Health and Local coursework on sanitation and hygiene for staff member Hygiene who will instruct communities in use and maintenance of new facilities, especially sanitary facilities (1 person for 1 academic year) 9 Finance Courses on aspects of municipal finance, and accounting (2 persons for 9-month courses) 18 Land Advanced work abroad on land registration methods and Registration technology (2 persons for 1 academic year each) 18 Total 72 2.45 A training officer under the MCC-s DPD will formulate the detailed training program and 'supervise its implementation. Close liaison will be maintained with MCC-s Personnel Department which has already begun investiga- tion of local courses. The training officer in liaison with the project manager, MCC's Personnel Department and the Bank will evaluate the suitability of local and regional courses. 2.46 Three studies are included on municipal management, a review of LWSC tariffs and further project preparation totaling 47 man-months. The biunicipal Management Study will conduct a general review of existing operations of MCC including the adequacy and clarity of its statutory laws, its organizational structure and management, revenues, accounting system and staff development program. The study is expected to take about six months requiring 21 con- sultancy staff-months covering four professional areas: legal, managerial, financial, and training. Recommendations will be developed by tihis team for strengthening MCC's overall operations. Six staff-months are also included to enable LWSC to carry out the tariff study called for under the bank-s First Water Project (para. 1.26), and 20 staff-months for preparation of a  - 21 - second urban project which would probably be national in scope. The costs of the three studies are estimated at about US$290,000, US$80,000 and US$300,00O respectively. For the implementation schedule on these studies see table 22476; for other conditions see para 2.49. C. Technical Assistance 2.47 Assistance will be provided MCC in implementing accepted recommenda- tions of the Municipal Management Study, and to establish MCC's collections operation, totaling 36 staff-months. Following government decisions on the Municipal Study recommendations, or earlier if the City wishes, provision has been made for a second phase of MCC's strengthening involving approximately four persons for between 3 and 12 months each, totaling 33 staff-months. Another 3 staff-months are included to help establish an effective collection operation to recover city revenues. Costs of the two tasks are estimated at US$230,000 and US$28,000 respectively. 2.48 In implementing the above program, an effort will be made to select individuals on firms who are not only qualified and experienced, but who are prepared to train their Liberian counterparts as part of their technical work. This might take place in the form of periodic seminars on particular topics, and greater participation by nationals in study team meetings, general decision-making sessions and study reviews. Studies and technical assistance would therefore become to some degree, supplementary, practical in-service training. Terms of reference will reflect this aspect. Staff of the MLG's supervisory unit will also be brought into this program. 2.49 A total of 83 staff-months is included in the project for studies and technical assistance, at an average cost of US$10,000 covering fees, subsistence and travel. Consultants utilized under the project will be employed under terms and conditions acceptable to IDA and terms of reference for major studies and technical assistance will be developed in consultation with IDA. Government will discuss with IDA the results and recommendations of all studies under the project within six months of their completion and will thereafter implement agreed follow-up measures in a timely manner.  - 22 - III. IMPLEMENTATION A. Executing Agencies 3.01 Primary responsibility for project implementation will lie with the Monrovia City Corporation (MCC) under the supervision of the Ministry of Local Government (MLG). Resettlement loans for households affected by up- grading works will be handled by the National Housing and Savings Bank (NHSB), and the water standpipe extension program by the Liberian Water and Sewer Corporation (LWSC). Land adjudication will be the responsibility of the Ministry of Lands and Mines (ML&M). 3.02 The Steering Committee which guided project preparation will be expanded and established as a permanent body of the MLG to coordinate project implementation and ensure a unified policy framework for all upgrading programs in Liberia. Membership will include MLG, MCC, NHA, NHSB, LEC, LWSC and the Ministries of Planning, Justice, Lands and Mines, Public Works, Finance, Education, and Health and Social Services. Chairmanship will be held by the MLG. Monrovia City Corporation (MCC) Agency Description 3.03 The MCC is a young institution, just beginning to formulate its policy and program, and to assemble its personnel. As noted in para. 1.18, municipal government was reestablished in Monrovia only five years ago in May, 1976 after a half century of central government control. As a public corpora- tion, the City can purchase, own and sell property, make improvements thereon, levy and collect taxes and revenues, undertake contractual obligations, and sue and be sued. 3.04 Functions: Although the 1973 charter gave the City identified powers, it failed to assign it specific responsibilities, and the Corpora- tion's first few years have therefore been largely devoted to regaining responsibility piece-meal for various municipal functions, and to setting up the institutional, legal and administrative structure to carry out those functions. The City's role has gradually expanded, now encompassing public health services, refuse collection, public safety (City Court), parks, ceme- teries and recreation, mass transit (buses) and markets. Minor maintenance of residential roads and storm drains have been undertaken by MCC, but formal responsibility for these services lies with the Ministry of Public Works. Additional authority is currently being sought for drainage maintenance, traffic management, fire services, and development control (building and zoning regulation) which now fall within the purview of the Ministries of Justice and Public Works.  - 23 - 3.05 The previous government s commitment to its stated policy of decen- tralization and strengthening of local authorities throughout Liberia had shown signs of ambivalence over the years, particularly in Monrovia where most national ministries remain heavily involved. Few have been inclined to share their authority, staff or budget with MCC, and the gradual extension of the City's duties has been slow and hard-won. 3.06 Despite the uphill nature of this effort, City budgets have tripled in the four years since MCC began operations, reflecting the agency's aggres- sive growth (Table 22401). Capital (development) expenditures began in 1979--the second year of operations, more than doubling the City's operations from about US$600,000 in 1978 to US$1.5 million in 1979. Thereafter, growth slowed to 29% and 20% respectively in FY'80 and FY'81 reflecting the country-s deteriorating economic position and general belt-tightening. The City's budget for FY'81 totals US$2.3 million. 3.07 Of this, only about 7% will derive from city revenues, leaving MCC almost entirely dependent upon annual government subventions and without its own spending authority. Central government has pre-empted most significant sources of local revenue including the property tax, typically the most common source of municipal revenue elsewhere. City income includes minor fees for market stalls, burials, trash collection, and City Court fines totaling only about US$164,000 in the current year. These are the only funds MCC has authority to spend directly. All other expenditures are disbursed by the Ministry of Finance including the payroll, procedures for which are elaborate. Separate annual accounts of MCC expenditures are not issued by the Ministry of Finance. 3.08 At the present time no financial statements are prepared by MCC on the small amounts left under its own control, nor is there any itemized inventory of City assets. An "audit" was carried out after the recent change of government, but previous record-keeping had been inadequate to satisfac- torily detail MCC's accounts. Government does not require annual submission of audited accounts from MCC as they do from other semi-autonomous Corporations. 3.09 Organization and Staffing: The City's organization involves five departments which deal with Traffic and Public Safety, Health and Sanitation, Recreation, Planning and Works, and Finance and Personnel. The City Court and Mass Transit Authority constitute semi-autonomous bodies which report to MCC (chart 22464). The Council is supposed to be made up of elected represen- tatives of 11 areas, and an elected Mayor and Deputy Mayor, all of whom ordinarily serve for four years. However, following the April change of government, the Council was suspended and the Mayor is now appointed. 3.10 Staffing and administration of MCC is weak, particularly with respect to the quantity and quality of professional staff and functioning of the existing structure. This problem derives partly from the City's rapid expansion and is exacerbated by its lack of authority and revenue. Although the City has over 500 employees, few are professionally qualified and those who are lack experience. Leadership has been inconsistent; the Mayor and  - 24 - Chief Officers have changed several times over the past few years. budget constraints have forced staff to work without adequate equipment and materials, reducing their productivity. Supervision of the preponderance of lower level workers severely overburdens the few professionals who generally also serve as department managers. Though not by any means uncommon in developing countries, this problem appears particularly acute in MCC, and is to a large extent beyond the City's own ability to rectify. Clearly staff development, espe- cially at professional and managerial levels, must be a major objective of MCC if the City is to satisfactorily perform the tasks so far assigned to it, let alone undertake new ones. 3.11 While the City in its present capacity clearly lacks the capability to carry out the proposed project, it has made a successful beginning. Progress is seriously hindered by the lack of clear responsibilities, a revenue base, accounts and financial control systems, professional staff and stable leadership. These essential ingredients must be supplied if the City's initial spurt of growth is to be consolidated. The situation offers an unusual opportunity to help shape and build a municipal authority, setting it on a proper footing from the beginning. To do this will require additional investment for institutional development, which is included under the project. 3.12 The City Corporation is considered the most appropriate executing agency for the project for a number of reasons. First, in view of the up- grading nature of the project and the exclusion of even house loans, the municipality is considered the right agency in which to vest the new function of spearheading and coordinating comprehensive improvement of municipal services. The City is also responsible for maintenance of more of the services provided under the project than any other single agency thus reducing some of the potential maintenance transfer problems. Tnese include refuse removal, shared sanitary facilities, markets and drainage. The mandate of the National Housing Authority--the alternative agency considered--lies primarily in housing development. 3.13 The principal reason, however, was the need to begin to develop a municipal management capability in Monrovia. Liberia's historical focus on its primate city needs to give way to more balanced regional development. This represents one of the new government's central objectives. For national ministries to turn their full energies to this task, they must be relieved of many of the day-to-day responsibilities they now hold in Monrovia--most of which represent ongoing maintenance and services typically performed by local government. Better coordination of investments in the municipal area is also needed to maximize the impact of Liberia's scarce financial and manpower resources. Problems of overlapping ministerial functions, poor coordination, and duplication of effort could be more effectively dealt with if more of these functions fell within the jurisdiction of one agency. Development of a municipal management capacity in Monrovia represents an important long-term objective towards which this project will make an initial step. 3.14 Central government however, must offer its fullest measure of support if this difficult task of building a municipality almost virtually from the ground up is to succeed. The commitment sought is embodied in  - 25 - several steps. During negotiations it was confirmed that (a) spending author- ity will be vested with the City for funds under this project and government will ensure a revolving fund of US$400,000 is provided to MCC. This fund would comprise a Special Account of IDA of $300,000 and a Project Account of GOL of $100,000. Controls and mechanisms of the Revolving Fund were agreed during negotiations. GOL's deposit of $100,000 would be a condition of Credit Effectiveness; and (b) MCC will prepare an opening financial statement in a form satisfactory to IDA by April 1, 1982 reflecting its position as of December 31, 1981 and will thereafter submit annual accounts of MCC opera- tions, including a separate account of project expenditures, audited by a firm acceptable to IDA not later than 6 months after the close of each fiscal year. Project Management 3.15 A new permanent department has been established within MCC to carry out upgrading programs within the municipal area (see Chart 22464). This Department, called the Development Projects Department (DPD), contains three sections: Technical, Community Development, and Finance (Chart 22464). Reporting by the DPD will be directly through the Deputy Mayor to the Mayor, and through him to the Ministry of Local Government. It was confirmed during negotiations that the DPD was established with defined responsibili- ties acceptable to IDA, and that its Director, a Deputy Director and Chiefs for the Engineering and Community Development Sections, had been appointed; it was agreed that a Finance Section Chief would be appointed no later than Board presentation and that the Department would be adequately staffed with full time personnel responsible solely for the project.' It was further agreed that all appointments or any subsequent replacement of the key staff (Director and Section Heads) will be made only after consultation with IDA. 3.16 As the primary executing agency, MCC through DPD will be responsible for detailed design and engineering, community consultation, preparation of tender documents, bidding, contract award, supervision of construction, and project monitoring. Consultants will be employed for some of these tasks, and private contractors will be utilized for civil works construction. In the case of water, sanitation, and power infrastructure, LWSC and LEC will either under- take turnkey contracts for design and construction or if MCC-s consultants take on the design work, the utility companies will review and approve detailed designs and tender documents, act in the capacity of supervising engineer during construction, and will authorize the contractor's final payment to ensure satisfactory construction and conformance with overall utility systems in Monrovia, and to facilitate prompt startup of maintenance activities by these agencies. The LEC and LWSC will ultimately own and maintain the infra- structure. The DPD will also oversee completion of the technical assistance, studies and training component of the project, and procurement of major items for Land Adjudication. Institutional responsibilities are shown in Table 22400. 3.17 For the new department to function effectively in executing its duties under the project, it was agreed at negotiations that the MCC will assign DPD responsibility for the following matters in relation to project activities: (a) staff control, including hiring, firing and determination of salary levels within MCC's established ranges and in accordance with MCC-s general terms and conditions;  - 26 - (b) inventory control (vehicles, equipment, materials); and (c) expenditure and commitment authority including establishment of its own bank account. 3.18 While the Department will initially retain responsibility for most activities under the upgrading component, it is envisioned that ultimately certain functions such as accounting and collections would be transferred to other sections of MCC when adequate staff and structure existed to undertake these tasks. Emphasis will be placed in this initial project on creating a competent long-term capability within MCC to carry out development projects such as this one, as well as its regular functions. Ministry of Local Government Role 3.19 Overall supervision of project implementation will be the responsi- bility of the MLG. The Ministry is organized around three main divisions of County and Territorial Development Planning, Rural Development and Urban Reconstruction (Chart 22463). Its portfolio covers a broad spectrum of activities whose basic objectives are to guide urban growth, maintain peace, supervise and strengthen local government, and coordinate government services. Self-help and public participation are major themes of the Ministry's approach. In smaller towns in particular this approach is essential since the Ministry's development budget is miniscule. 3.20 The MCC will report to the Deputy Minister for Urban Reconstruction, who will be responsible for ensuring the City is conforming to governments overall upgrading policy, observing the agreed financial controls, and that reporting requirements are being met. Preparation activities on a possible second project, expected to be national in scope, will also fall under this division. 3.21 Throughout project preparation the MLG has played the major role and is capable of carrying out its proposed duties. The Liberian project preparation Director was recently promoted to Assistant Minister for Urban Reconstruction and is fully conversant with the project. He is professionally qualified, has since participated in the EDI urban course and is a strong advocate for the upgrading work. His unit will also contain one or two staff who have represented the I'LG on the Steering Committee. The core of the MIG unit is therefore already in place. The project will attempt to begin building within this section of the MLG a capability for eventually preparing, evalua- ting and supervising urban development projects throughout the country. National Housing & Savings Bank (NHSB) Agency Description 3.22 The National Housing and Savings Bank (NHSB), a fairly new government- owned agency opened in 1976, is intended to become the government-s major mortgage lending institution especially for lower and middle-income groups. While the NHSB grew rapidly from 1976-1979, the April 1980 change of govern- ment brought a decline in both deposits and lending which continued throughout  - 27 - the year. Commercial activities and loans to public corporations have dominated NHSB-s portfolio to date with mortgages represented only 13% of total loans outstanding as of January 1980. Lower-income groups represented a very small proportion of borrowers. Recently, however, the NHSB together with the NHA has undertaken a major USAID-assisted site and service project (para. 1.24) with the objective of reaching poorer families. The Housing Bank is reasonably well-run and well organized. Its organizational structure (Chart 22523) is sound and the agency has experienced front line management as well as competent middle management and is fully computerized. Project Role 3.23 The NHSB is fully able to handle the relatively few resettlement loans required under the project to move families in the pathway of essential services. Since the total number of such loans is below 100, no special staffing will be required. MCC-s community development personnel will liaise with affected households wishing to borrow. 3.24 Qualification requirements for NHSB loans may need some adjustment for project participants. Normally applicants are required to: (a) have a savings account with a balance of approximately 3% of the loan but not less than US$150; (b) deliver title deed to NHSB for the land; and (c) obtain life and fire insurance for the duration of the mortgage. For landlords with substantial properties these requirements may continue to make sense. During negotiations, however, it was agreed that for lower income owner-occupiers wishing to borrow sums below US$3,500 normal requirements for savings accounts, and life and fire insurance will be waived in exchange for a government guarantee or authority to add a 1% risk surcharge to their interest rate on these loans, and that a long-term lease will be accepted in place of land title which would not be obtainable in most resettlement areas. Mortgage terms, proposed at 12% over 20 years, are the same as those under the USAID project. Though a little below the projected inflation rate of 15%, the proposed interest rate is roughly in line with inflation over the past three years which was 7.3%, 11.6% and 13.4%. The interest rate will be reviewed periodically to ensure it remains reasonable. The house loan component, however, is so small (1% of project costs) that a more substantive involvement in Liberia's interest rate structure is not merited. Ministry of Lands and Mines (ML&M) Agency Description 3.25 Land adjudication will continue to be handled by the Ministry of Lands and Mines, through a team headed by staff of the Ministry of Justice. The ML&M contains three departments whose titles reflect its major objectives: Resource Development and Conservation, Exploration and Research, and Land Surveys/Cartography (Chart 22466).  - 28 - Project Role 3.26 Phase I of the adjudication will De handled through the Director of Lands and Surveys under a contract drawn up with DPD. Monrovia-wide adjudica- tion will continue under the same department. Progress will be monitored through quarterly reports which will cover both expenditures and progress made against identified benchmarks. 3.27 Since the land registration exercise has been underway for several years, the Adjudication Unit is established and almost fully staffed with trained and experienced Liberians. A referee heads the unit, a lawyer ap- pointed by the Chief Justice of the Supreme Court (now the "Supreme Tribunal"), who is both the executive director and a judicial officer. The referee is empowered to make binding decisions as to boundaries and titles, subject only to formal appeal to the courts. Each of the seven field teams has six members: one adjudication officer who is also a qualified lawyer appointed by the Chief Justice, a demarcation officer (surveyor), his assistant, and three workmen. It was confirmed at negotiations that the seven adjudication teams will be maintained at full strength of six persons each including new positions during project implementation, with qualified and competent personnel, and that four of the seven teams will be assigned to Phase I in project areas until its completion. It was also agreed that the adjudication procedures will not be substantially changed without consultation and agreement with IDA. Community Organizations 3.28 Communities themselves will play an important role in project imple- mentation. All areas to be upgraded have a formally structured community organization, of which the joint Development Committee in Claratown established in 1977 appears the strongest. A unique feature of the Claratown organization is that all community residents are represented. Neighborhood Development Associations (NDAs) were formed in 1979 in both Sonewein and Slipway, but in these organizations membership is restricted to property (land or house) owners. Two of the three communities have sporadically attempted their own improvement programs. Claratown's Committee successfully imposed its own $100 plot tax to engage a lawyer to represent them in an effort to obtain clear land title, and subsequently also collected funds to improve their access road. A similar road project was undertaken in Slipway, though neither was realized because of the difficulty of obtaining the necessary heavy equipment and cooperation of government institutions. These efforts, however, demonstrate the communities' desire for improvements and willingness to pay for them. 3.29 Briefings have begun in each community as part of the consultations on detailed design. Residents will have an opportunity to review improvement plans, express their views regarding priorities between various services, and shape the role each will play in maintenance and operation of facilities (such as community centers) and in collections.  - 29 - B. Implementation Schedule 3.30 Project implementation is expected to take about four years (Chart 22476) with start-up about mid-1981. With respect to upgrading, detailed design, tendering and award of contracts should be completed by the end of Calendar 1981. Resettlement would be done during this period. Civil works will occupy 1982 through mid-1984. Property tax collections will begin in upgrade areas in early 1984. The LWSC standpipe program will operate on an independent timetable with design, tender and contract award completed by LWSC in the first quarter of 1982, and construction by the end of 1983. The second component, land registration, will be done in two phases. The first will require through 1982. Demarcation is now underway and should be complete by the end of this year, with legal proceedings taking another year. City- wide adjudication will continue through mid-1985. Institutional work--the last element--will continue throughout project implementation (see chart 22403). Training will begin immediately under PPF funding, and continue through the end of 1982. Studies will be spread through 1982 and 1983 with technical assistance following in 1983/84. C. Procurement 3.31 The MCC will procure goods and services under the project in accor- dance with Bank guidelines. Contracts for civil works including community facilities and refuse vehicles totaling US$7.3 million or 55 % of project costs will be procured on the basis of international competitive bidding. Contracts for the three settlements will be tendered together, but grouped in such a manner that bids may be submitted for each separately or for the total package. Advertisement will be done locally and in the Development Forum, with notification to embassies of Bank member countries, Switzerland and Taiwan. The MCC will consult with LEC and LWSC to ensure prequalified firms are acceptable and meet required standards if LEC or LWSC choose not to undertake Turnkey contracts (para. 3.16). Because of their relatively small size, however, and the upgrading nature of the work, the civil works contracts are unlikely to attract foreign participation. 3.32 Local competitive bidding procedures will be used for works totaling US$2.0 million or 15% of project costs. Included in this category are small contracts for furniture and equipment for primary schools, aerial photography and mapping of project sites, studies, engineering consultancy and miscel- laneous vehicles and equipment for project management. Local procedures, which allow for international bids, have been reviewed and are satisfactory. 3.33 The remaining US$4 million or 30% of project costs represent reset- tlement loans, compensation, staff salaries and operating costs, training, technical assistance and repayment of the PPF advance, all of which will be procured or paid directly under government or MCC budgets. House construction materials under resettlement loans will be obtained through local suppliers by individual households.  - 30 - D. Land Acquisition 3.34 Title or legal rights-of-way will be obtained for infrastructure services and community facilities built under the project. While some already exist, others will have to be acquired before construction begins. Fortunately, only small amounts of land are involved, and Liberian law makes ample provision for government to take land by eminent domain irrespective of the status of title or boundaries, any disputes over which can be settled later. Liberian utility authorities have been using this provision for years and have found it effective. Therefore, land will be acquired by private voluntary sale wherever possible, but where ownership is unknown or in dispute, or the owner refuses to sell the condemnation procedure will be used to avoid delays. Compensation will be in accordance with established government schedules which reimburse owners for the estimated "market" value of land and replace- ment value of dwellings (para. 2.19). E. Monitoring and Evaluation 3.35 Monitoring and evaluation will be done by the DPD and also by the supervising unit within the Ministry of Local Government. Its focus will be the provision of essential management information, the analysis of major implementation problems, and evaluation of whether the project's major objectives have been achieved. Emphasis will be placed on close observation of the experimental.elements in the project such as collection systems, maintenance of ablution units and the impact of upgrading on rents in central settlements. Regular feedback will facilitate adjustments in these operations. The University will participate under short consultancy contracts. During negotiations it should be confirmed that quarterly reports will be prepared by MCC containing sections on the house loan program for resettlement to be prepared by NHSB, the standpipe extension program to be prepared by LWSC, and land adjudication to be prepared by the ML&M, and that upon termination of the project a completion report will be prepared by government, the format and content of which will be agreed with IDA. Formats for quarterly reports will be developed during the first Bank supervision mission. F. Recurrent Costs 3.36 Annual maintenance costs are expected to total about US$90,000 for infrastructure representing 1-5% of capital costs. These would be borne by the Ministry of Public Works (MPW) for roads and most drainage (US$32,000), the LWSC for water and sewer works (US$23,000), and MCC for refuse collection points and security lighting (US$35,000). It was confirmed at negotiations that government will adequately staff, operate and maintain infrastructure and community facilities built under the project. Maintenance of water, sewerage and drainage systems in particular, however, is a long-standing and pervasive city-wide problem. Lack of it has caused the blockages and failures of  - 31 - existing infrastructure, some of which is being replaced through this project. A study of the situation and some emergency improvements have already been initiated by LWSC (para 1.26). These efforts will be closely monitored through continuing collaboration between the urban, water and power sectors within the Bank with a view to developing through ongoing Bank operations a program for improving maintenance of these systems over the longer term. 3.37 Annual recurrent costs (maintenance and operations) for community facilities will run about US$64,000 for primary schools, US$265,000 for health facilities, US$18,000 for markets, and US$2,000 for community centers. These will be the responsibility of the Monrovia Consolidated School System (MCSS), the Ministry of Health, the MCC and individual communities, respectively. Recurrent unit costs per primary school pupil are about US$145. A slight increase in teaching staff will occur in Claratown from 6 to 8 with a concur- rent decrease in the pupil-teacher ratio from 70:1 to 50:1. Government minis- tries and agencies and the MCC have confirmed their ability to undertake these responsibilities, but the capacity to fulfill this obligation, partic- ularly for hea:Lth facilities, should be reassessed prior to contract award. 3.38 Maintenance of ablution units with public water standpipes and collective toilets has been poor in many countries. However, because of Monrovia's special physical conditions sewerage is considered the most prac- tical sanitation solution, despite these potential difficulties. Responsi- bility formally lies with MCC to maintain these facilities. As noted above, it is intended that collected toilets remain privately assigned to identified houses who would be fully responsible for their maintenance. Because of the problems experienced elsewhere with maintenance, however, MCC intends to experiment with more than one approach. The options under consideration are detailed in para. 4.24 since they are linked with collection mechanics. G. Supervision 3.39 Project supervision in the first year is expected to require about 30 staff-weeks, of which 16 would be in the field. This is slightly above average because of the need for specialist attention to the land adjudication component. The Bank's WAP Education and Water Supply divisions and the CPS Education Department will assist in project supervision.  - 32 - IV. COSTS AND FINANCIAL FEATURES A. Costs 4.01 The estimated total cost of the project (Table IV-1) is US$13.3 million, including contingencies. Only minor land costs are included for compensation for rights-of-way and community facilities, since no other acquisition is necessary. The estimated foreign exchange component is US$6.8 million or 51% of total costs. Excluding taxes and duties estimated at US$0.3 million, the project cost is US$13.0 million. Base cost estimates are in January 1981 prices. Price contingencies for the project are based on a projected average domestic inflation rate of 15% over the four year project period, and rates of 9%, 8.5%, and 7.5% on foreign costs for 1981, 1982 and 1983-85 respectively. Price contingencies total US$2.5 million or 19% of total costs, physical contingencies total US$0.7 million or 5% of total costs and are based on a rate of 15% on civil works and buildings. Detailed design and engineering and construction supervision are estimated at 10% of civil works costs. The DPD's salaries and operations are estimated at 8%. 4.02 Cost estimates are based on preliminary engineering studies prepared by the Monrovia Urban Development Project Preparation Team. Because of escalating expectations on the part of the three affected communities it was judged inadvisable to proceed with detailed engineering until the project was closer to Board presentation. This is normal for squatter upgrading works in Bank projects. Rates and unit prices for civil works were therefore obtained from local contractors and the Ministry of Public Works. The costs of schools reflect those used in the Bank's Second Education Project and those estimated under the proposed Fourth Education Project. B. Financing Plan 4.03 The IDA would finance about US$10.0 (SDR 8.3) million or 75% of total project cost, and government the remaining US$3.3 million or 25% as shown in Table IV-2. The IDA credit would cover 76.5% of total project costs net of taxes and duties. 4.04 The IDA credit will cover the foreign exchange cost of the project and 49% of local costs, excluding taxes and duties, and will be extended on normal IDA terms. Government will be the borrower and will assume the foreign exchange risk.  - 33 - Table IV-1: SUMMARY Total Project Costs January 1981 US$'000 % Foreign Local Foreign Total Exchange UPGRADING Claratown: On-Site Infrastructure 466 567 1,033 55 Off-Site Infrastructure 35 79 114 70 Primary School 163 38 201 19 Health Unit 19 5 24 20 Community Center 26 5 31 15 Market 211 58 269 22 Sub-Total 920 752 1,672 45 Sonewein: On Site Infrastructure 504 516 1,020 50 Off Site Infrastructure 154 350 504 70 Primary School Improvements 54 36 90 40 Health Unit l 6 24 25 Community Center 26 5 31 15 Market Expansion 140 42 182 23 Sub-Total 896 955 1,851 52 Slipway: On Site Infrastructure 340 296 636 47 Off Site Infrastructure 21 46 67 70 Primary School Improvements 26 16 42 40 Health Unit 18 6 24 25 Community Center 27 4 31 15 Sub-Total 432 368 800 46 Other: Housing Loans 93 23 116 20 Health Center New Kru Town 377 200 577 35 Refuse Equipment & Cans - 580 580 100 LWSC Standpipe Extensions 182 418 600 70 Aerial Photography & Mapping - 120 120 100 DPD salaries & operations 688 143 831 17 Sub-Total 1,340 1,484 2,824 53 TOTAL 3,588 3.559 7,147 50 LAND ADJUDICATION Phase 1: Project Areas 306 121 427 30 Phase II: City Wide 666 456 1,122 40 TOTAL 972 577 1,549 37 INSTITUTIONAL DEVELOPMENT Training - 127 127 100 Studies 57 514 571 90 Technical Assistance 26 232 258 90 PPF Repayment - 450 450 100 TOTAL 83 1,323 1,406 9 SUB-TOTAL (BASE) 4,643 5,459 10,102 54 &Physical Cont. 343 357 700 51 Price Cont. 1,590 945 2,535 _ TOTAL PROJECT COST 6,576 6,761 13,337 51  - 34 - Table IV-2: Financing Plan Total Cost Financed by Item (US OOO) World Bank Government UPGRADING Infrastructure 4,038 2,976 (70%) 1,242 (30%) Community Facilities 2,125 1,471 (70%) 654 (30%) Compensation 282 - 282 (100%) Construction Loans 137 95 (70%) 42 (30%) Refuse Equipment 632 632 (100%) - Aerial Photog/Mapping 120 120 (100%) - LWSC Standpipe Extensions 750 519 (70%) 231 (30%) Detailed Design/Eng. 735 735 (100%) - MCC/DPD Salaries/Operations Salaries/Operations 928 590 (65%) 338 (35%) Vehicles/Equipment 77 77 (100%) - Sub-Total 9,824 (100%) 7,035 (72%) 2,789 (28%) LAND ADJUDICATION Salaries/Operations 1,267 809 (65%) 458 (35%) Technical Asst. 300 300 (100%) - Equipment 360 270 (75%) 90 (25%) Sub-Total 1,927 (100%) 1,379 (72%) 548 (28%) INSTITUTIONAL DEVELOPMENT Training, Studies, Tech. Asst. & PPF Repayment 1,586 (100%) 1,586 (100%) - TOTAL 13,337 (100%) 10,000 (75%) 3,337 (25%) 4.05 A total of US$4.2 million would be on-lent to MCC, the NHSB, and LWSC, of which the IDA will provide US$3.4 million. The principle governing onlending is that the agency ultimately receiving the asset developed under the project will also undertake the associated debt burden. The flow of funds for construction will therefore differ from the onlending amounts. Of total project costs, about US$2.3 million will be on-lent to MCC of which US$2.0 million would be IDA funds for wet cores, security lighting, refuse vehicles and portions of training, technical assistance, studies and management related to MCC. About US$0.1 million would be on-lent to the NHSB for house loanis for essential resettlement, of which US$95,000 would be IDA funds. Another US$1.8 million would be on-lent to the LWSC for off-site water and sewerage infrastructure, the standpipe extension program and the water tariff study, of which US$1.4 million represents IDA funds. Onlending terms to MCC, LWSC and NHSB would be 9% over 20 years with 5 years grace, which is about 2 points above the current domestic savings rate. Government would retain the assets built with the remaining US$9.1 million, including US$6.5 million of IDA funds, and will therefore also retain the debt liability on these funds. During negotiations, it was confirmed that on-site water and sewerage infra- structure (representing about US$1 million of the total retained by government) will be transferred to LWSC at an asset value to be agreed between LWSC and  - 35 - government provided that a revised tariff structure has been introduced which would enable the LWSC to meet the attendant debt service on these assets. 4.06 The MCC will initially handle the majority of funds (US$10.1 million or 76% of total costs) to simplify project administration and accounting thereby enhancing overall accountability for progress, and to ensure coordina- tion of design and contracting arrangements in the three upgraded areas. As noted above, once built, assets would be turned over to government's usual agencies who would own, operate and maintain them. The anticipated flow of funds is shown in Table IV-3. Table IV-3: Flow of Funds Agency Initially Handling Funds Total Cost NHSB or Component (US$'000) MCC ML&M General GOL LWSC UPGRADING Infrastructure and Community Facilities 6,163 6,163 Compensation 282 282 Construction Loans 137 137 Detailed Design/ Eng./Spn. 735 735 Solid Waste 632 632 Management and Aerial Photography 1,125 1,125 LWSC Standpipe Ext. 750 750 Sub-Total 9,824 (100%) 8,655 (88%) - 419 (4%) 750 (8%) LAND ADJUDICATION Equipment/Operations 423 423 Salaries 1,504 1,504 Sub-Total 1,927 (100%) 423 (22%) 1,504 (78%) INSTITUTIONAL DEVELOPMENT Tariff Study 80 80 Training, Studies, Tech. Asst. 1,056 1,056 PPF Repayment 450 450 Sub-Total 1,586 (100%) 1,056 (67%) - 450 (28%) 80 (5%) TOTAL 13,337 (100%) 10,134 (76%) 1,504 (11%) 869 (6%) 830 (6%)  - 36 - C. Disbursements 4.07 The IDA will disburse against the following items: Amount Amount % (US$'000) (SDRs) I. Civil Works 70 4,500 4,000 II. House Loans 70 100 90 III. Equipment 100 of foreign 900 800 or 75 of local IV. Consultancy Services 100 2,090 1,860 and Training V. Operating Costs & Salaries a) MCC 65 600 530 b) ML&M 65 800 710 VI. PPF Refinancing 100 490 440 VII. Revolving Fund - 300 270 VIII. Unallocated -_ 220 200 TOTAL 10,000 8,900 4.08 Disbursements for civil works, consultancy services and training, and all major equipment representing about US$8.5 million would be made against fully documented contracts and receipts. Expenditures for house loans, operating costs and minor equipment would be individually small and submission of the associated documentation would be burdensome and costly to MCC. Disbursements for these items will therefore be made against a statement of expenditure, the back-up documentation for which will be retained on file for periodic inspection during supervision missions. The MCC does not pre- sently have a satisfactory accounting system or audit arrangements and it was confirmed at negotiations that the establishment of a basic project account and auditing system would be a condition for Board Presentation. The establishment of a comprehensive system of project accounts and audits satis- factory to IDA will be a condition of disbursement for all items on which a statement of expenditure will be used. The MLG is presently assisting the City in setting up the required accounts which should be completed by mid-year. The estimated schedule of disbursements (Table IV-4) is based on the project's implementation schedule (Chart 22476). This projected schedule is considered realistic, allowing time for slippages on target planning. A four year schedule is generous for this project, given its modest scope, particularly of its physical components. Chances for delays approximately equal chances to accelerate implementation. D. Cost Recovery/Affordability 4.09 Water and sewerage improvements, constituting about 14% of total project costs and house construction loans for resettlement, about 1% of project cost, will be recovered through utility tariffs and individual mortgage payments, respectively. The remaining 85% of project cost is designed to be recovered through city-wide property tax charges, as shown in Table IV-5.  - 37 - Table IV-4: Disbursement Schedule (US$-000) Amount Cumulative Cumulative Fiscal Year Quarter Date Disbursed Amount % FY82 1 Sept. 30, 1981 - 2 Dec. 31, 1981 700 700 7 3 March 31, 1982 550 1,250 12 4 June 30, 1982 650 1,900 19 FY83 1 Sept. 30, 1982 850 2,750 28 2 Dec. 31, 1982 950 3,700 37 3 March 31, 1983 1,200 4,900 49 4 June 30, 1983 1,300 6,200 62 FY84 1 Sept. 30, 1983 950 7,150 72 2 Dec. 31, 1983 775 7,925 79 3 March 31, 1984 725 8,650 87 4 June 30, 1984 450 9,100 91 FY85 1 Sept. 30, 1984 300 9,400 94 2 Dec. 31, 1984 300 9,700 97 3 March 31, 1985 200 9,900 99 4 June 30, 1985 100 10,000 100 4.10 Property Taxes: One of the project's main objectives is to gradu- ally develop a solid revenue base for the municipality, initially by strength- ening city-wide property tax collections. Improvements of property tax collec- tions is a Government objective in itself, independent of the project. The use of the project as a vehicle to concentrate attention upon these taxes is considered appropriate for several reasons. First, collections of property taxes are presently very low - about 20% of potential yield based on present assessments - and are not applied at all in squatter areas, thus creating a significant potential for increasing public revenue generation, without the introduction of a new tax. Second, Liberian manpower and administrative capacity - already thinly stretched - will be better utilized by concentrating on the enforcement of an existing tax and improvement of its collections, rather than creating a new one. Third, the proposed revenue-sharing formula (para 4.12) offers the City Corporation its first significant long-term revenue, the proceeds of which will continue after debt servicing of onlent funds under this project has terminated. Thus, it represents an important initial step towards establishing the City-s own revenue base. Finally, Government has expressed a clear preference for the property tax revenue- sharing arrangement among the several options, considered at appraisal, for the generation of additional revenues to offset project costs. Among others considered were a special assessment tax and the increase of utility tariffs.  - 33 - LIBERIA Monrovia Urban Development Project Table IV-5: Cost Recovery-/ Recovery Source Total Property Tax Utility Individual Component Costra/'MCC Portion Govt. Portion Tariffs Beneficiaries UPGRADING Infrastructure Roads, footpaths, drainage 1,885 1,885 Water & Sewerage on-site 1,000 1,000- off-site 925 925 Wet Cores 577 577 Security Lighting 110 110 Compensation 283 283 Community Facilities 2,315 2,315 House Construction Loans 137 137 Refuse 631 631 LWSC Standpipe Extn. 833 833 Aerial Photog/mapping 120 120 Management MCC portion (20%) 200 200 Govt. portion (80%) 808 808 Sub-total 9,824 1,518 6,411 1,758 137 LAND ADJUDICATION 1,927 1,927 INSTITUTIONAL DEVELOPMENT Training MCC portion (20%) 111 111 Govt. portion (land) 27 27 Studies Munic. Mgmt 290 290 Tariff 80 80 Second Project 300 300 Technical Assistance Mlunicipal Mgmt. 292 292 Collections 36 36 PPF Advance 450 . 450 Sub-total 1,586 729 777 80 IrOTAL 13,337 2,247(17t.) 1,115(68%) 1,828(lt7) 137(Iff,) a/ Including design and all contingencies. b/ To be shifted eventually to utility tariffs after completion tariff study. _/ Recovery of maintenance costs is reflected in Table IV-6: M4CC Project Cash Flow.  - 39 - The main disadvantage of the special assessment tax would be the political and administrative difficulty of introducing a new tax. An increase in utility tariffs appeared politically unacceptable at this time. The strength of Government support for improvements in the property tax system is expected to be a key element in the ultimate success of collections. 4.11 Thus, although property tax collections will be used to create an incremental increase in financial resources and thus to offset project costs, it is clear that a direct mechanism for replicability in the sense of the establishment of an earmarked fund for this purpose, is not the objective in this first project. Attention is being directed at the development and improvement of a sound overall system of revenue-collection which is con- sistent with government's long term objectives and which will continue to operate independently of any project considerations. Upgrading could then be continued by a financially sound municipality, since unit costs--at US$100 per capita oIr US$500 per household are relatively low. Through its land adjudication and registration components, and through the proposed strengthen- ing of the City's institutional and financial framework, the project intends to lay the foundation for developing a stronger base for more direct cost recovery mechanisms and replicability under future projects. This will be needed for continued expansion of public investment in such projects once collection of existing revenues reaches a reasonable proportion of its potential. 4.12 Initially, revenues would be shared between the City and government. During negotiations it should be agreed that MCC will receive legal authoriza- tion to implement the project and collect the property tax in Monrovia and to retain initially 30% of the total sum collected net of collection costs. Experienced staff of the Ministry of Finance will be transferred gradually to MCC to carry out this function on a timetable to be agreed between IDA, the MCC and the Ministry of Finance by June 30, 1982. 4.13 This formula reflects a proportionality with MCC's and Government's respective debt servicing under the project, being about 20% versus 80%, plus an additional incentive for the City, in order to develop and strengthen its collection capacity. The impact of the proposed revenue sharing on MCC's financial position is analyzed in para 4.25. 4.14 Property taxes are assessed in two parts: a rate of 2% p.a. is applied to the land value, and a separate rate of 0.5% to the house (improve- ment) value. A typical property in Sonewein comprising a plot of about 4,500 sq. ft. (400 m2) valued at US$375, with a house valued at US$9,000 would therefore bring in about US$52.50 per year, representing US$4.40 per month or about $1.45 per household. Assessed values in Monrovia are typically well below what they might be in many other developing countries, since, as noted earlier, there is no effective property market and sales occur infrequently. Values therefore tend to be based on a relative rather than absolute figure. A city-wide revaluation of properties is being done as part of the adjudication process.  - 40 - 4.15 Utility Tariffs: In addition to the property tax, residents will pay for recurrent utility consumption for power, water and sewer. Since the extent of individual water and sewer connections is unknown, the figures shown under monthly charges below reflect use of public standpipes. To date, water at standpipes has been free. However, the LWSC has not been receiving the Government's payment for this water and it is doubtful that Government could afford to continue this payment if standpipe improvements are extended to a growing proportion of Monrovia's population. Therefore, during negotiations it was confirmed that those utilizing water from standpipes in project areas will pay for water consumed on an experimental basis. The amount to be paid together with the method of collection will be the subject of a Tariff study to be undertaken by LWSC. Meanwhile, until such collections are demonstrated to be reasonably effective, government's obligation under the Bank's ongoing First Water Project (No. 859-LBR) to pay LWSC for water consumed at standpipes will continue. 4.16 Monthly Charges: payments arising from property tax on a typical low-cost dwelling and minimal recurrent utilities are shown below: Amount per Household per Month_/ Property Tax Water a! Sewer b/ Power c/ Total Sonewein 1.45 1.00 .60 1.35 4.40 Slipway 1.00 1.00 .60 1.35 3.95 Clara Town .95 1.00 .60 1.35 3.90 Straight Average 1.13 1.00 .60 1.35 4.08 a/ Assuming consumption of 15 lcd by a family of five at US$1.68 per 1,000 gallons. b/ 60% of water. c/ 2 X 60 watt bulbs, 3 hrs. evening at 12.51 per kwh = 1.35, reflecting normal LEC tariffs. d/ Assuming 3 households per house. 4.17 Affordability: Assuming families could pay up to 15% of total income for property tax (services) and recurrent charges, the above monthly charges would be affordable to those at or above the 6th percentile of the income distribution curve in project areas, representing family earnings of about US$25-US$30 per month. The affordability analysis compares 1981 incomes and price levels. Increases at the lowest income levels generally lag somewhat behind price increases, which could raise the lower end of target incomes slightly above the 6th percentile. Those few families below this level would be covered through the city-wide "cross-subsidy" inherent in a property tax. Since collections will not be direct, but through property owners, however, there is some risk that in centrally located zones where the proportion of absentee landlords is high, rents may rise by more than the amount of the legitimate pass-through of the property tax, directly affecting affordability of the resident population. This risk is addressed in para. 5.14.  - 41 - Collection Performance 4.18 Actual collections of public and other revenues throughout the country have deteriorated over the last year, but prior to that time, per- formance was mixed. Utilities and some general revenues such as the property tax have shown poorer performance records than have the NHSB and NHA where collections are reported to be as much as 85%-95% of those anticipated. The LWSC indicates that only about half of all water produced is billed and of this, only about half is collected. Government is a major cause of this situation with total outstanding arrears of about US$2.2 million as of December 1980, largely representing billings for water consumed at public standpipes. The more encouraging performance by the NHSB and NHA appears to indicate, however, that with good administration and follow up (the NHSB is computerized) collections could be sharply improved. 4.19 Property Taxes: Specifically with respect to the property tax, current collections in Monrovia are quite low. The Ministry of Finance which is responsible for collections, realized only about US$1.9 million in FY79 and FY80 - representing less than 20% of what they estimate annual revenues should be based on current assessments. Considerable scope therefore exists for improvement. 4.20 A number of steps will be taken as part of the project to increase the yield from property taxes. First, the land adjudication component will pick up the slow pace of land registration in Monrovia, the first major element in improving performance. Registry will initially focus on the three upgraded areas where MCC-s collections will begin, and move thereafter to the entire city. Property valuation, the second major step, is currently the focus of a four-year USAID-assisted technical assistance program. Valuation is pro- ceeding independently from land registration and is based on presumed (undis- puted) boundaries. Since completion of legal registration requires tax clearance, the valuation team has interspersed their area-by-area work with spot valuations for those undergoing adjudication in other parts of town. Such valuations are done promptly and usually completed within a few days of the request. The MOF's Chief Valuer is assisted by two "Principal Valuers" and 35 trained valuers, many trained under the ongoing program. They estimate it will be possible to complete the revaluation of Monrovia within the two remaining years of USAID assistance. 4.21 Actual collections remain the major problem. Sending out tax bills has not worked since Monrovia has no formal street numbering system and P.O. Box numbers of property owners are outdated. Even if delivered, notices are often disregarded. When properties are sold, back taxes are usually cleared since registration of the new owner requires such clearance, but sales are rare. Although the law provides for confiscation and auctioning of properties for non-payment of taxes, present officials have no memory of any property being foreclosed and actually sold. 4.22 The Municipal Management Study undertaken as part of the project will attempt to identify a more effective method of property tax collections to be tried initially in project areas by MCC. Three man-months of technical  - 42 - assistance are included to help initiate the system in project areas, and the overall financial technical assistance to MCC will focus on strengthening broader city-wide collections. 4.23 The preceding steps are expected to gradually improve the collec- tions performance. During negotiations it was confirmed that MCC will discuss and agree with IDA each year the targetted annual increase to be achieved over the present level of collection (currently 20% of the potential yield of property taxes, based on total assessments of US$10 million). Such targets might be, for example, 10% in 1983, 20% in 1984 and 30% in 1985-87. 4.24 Water Standpipes: Collection of experimental water kiosk fees (para. 4.16) could either be combined with toilet maintenance or left separate. Either way there exists essentially four choices. The task might be undertaken by: (a) the several houses using the facility who would be fully responsible for maintenance and collection of user charges; (b) a franchise (private individuals); (c) a franchise in the form of the community which would make its own internal arrangements for collection and maintenance; or (d) an MCC employee. Current water prices in the target settlements are sufficiently high to allow a substantial profit margin even after maintenance costs and/or franchise fees. There should therefore be a strong financial incentive for the franchise holder to ensure adequate maintenance. The MCC would periodically inspect facilities, which they are staffed to do. These options will be further reviewed under the water tariff study and a decision taken in consultation with each community as well as with LWSC and MCC. Several approaches might be tried. Results will be monitored and MCC's approach modified accordingly on the basis of experience. E. Financial Impact on MCC 4.25 The cash flows on the following pages reflect the impact of the project on the City's financial position. Table IV-6 shows project operations under MCC utilizing property tax revenues to offset project costs as indicated in para. 4.09. If efforts are successful to improve city-wide property tax collection, application of the proposed revenue sharing formula between MCC and Government would result in more than off-setting of MCC's project costs. During project implementation expected annual revenue increases would exceed MCC's annual project expenditures by sums which will range from US$150,000 in 1981 to US$526,000 in 1984. 4.26 Table IV-7 presents the City s normal operations without the project. At present, the City generates a modest six percent of its funding requirements through City revenues. The cash flow indicates a continuing need for substantial Government funding rising from about US$2.1 million to US$ 2.3 million during project implementation, up to about US$5.6 million by 1990. The ratio of the City's total revenues to the additional government funding required ranges between 5% and 15% in the same period. The main assumption underlying the City's cash flow for its normal operations reflects in principle the extrapolation of present financial patterns. In addition, a modest growth rate was assumed to reflect population growth.  - 43 - 4.27 Consolidation of the cash flows for the City's normal operations and for its project operations is reflected below: 16CC: Summary Consolidated Cash Flows 1981 - 1990 US$'000 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 Balance on Project Operations 150 650 465 526 425 1,019 1,265 1,610 1,741 1,755 Deficit on Mainstream Operations (2,141) (1,676) (1,954) (2_275) (2,948) (3,080) (3,748) (4,173) (5,077) (5,642) Total Annual Deficit (1.991) (1,026) (1,489) (1,748) (2,523) (2,061) (2,483) (2,563) (3,336) (3,887) Cuanulative Deficit (1,991) (3,017) (4,506) (6.254) (8,777) (10,838) (13,321) (15,884) (19,220) (23,107) Project Balance (1) as percent of mainstream operations deficit (2) 7 39 24 23 14 33 34 39 34 31 4.28 This table shows a positive balance which is proposed to be applied against the City-s substantial need for government funding on its normal operations. This balance ranges between 9% and 39% of the deficit on the City's normal operations during project implementation and around 35% in subsequent years. In order to further reduce the need for government funding, new revenue sources will have to be identified. The proposed property tax revenue sharing is a first step. It is expected that the proposed Municipal Management Study and Technical Assistance will assist government in identifying and establishing other revenue sources for the City. Thus, to better carry out its expanded municipal roles and responsibilities, the City's operations will increasingly become self-financing. 4.29 The last cash flow (Table IV-8) shows that total property tax reve- nues are more than adequate to offset project costs which are not recovered through utility tariffs or individual mortgages (representing 85% of the total cost). The bottom line shows that the project will require about a third of total property tax revenues during implementation dropping to about 25% after the debt service peaks in 1987. Thereafter, the proportion declines with debt service requirements. Thus three quarters of property tax revenues will remain available for general purposes.  Monrovia Urban Development Project Table IV-6: MCC - SOURCES AND APPLICATIONS OF PROJECT FUNDS (US$'000) e 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 Sources of Funds 1. GOL Project Funds 48 711 991 430 2. IBRD Project Funds 964 2,543 3,083 1,305 59 3. GOL Revolving Fund 150 150 4. City Wide Pyoperty Tax Collection- a _ 1,900 2X090 2,508 3,260 4,239 5,510 6,612 7,000 7,000 TOTAL SOURCES 1162 5,304 6,164 4 243 3 319 4 239 5 510 6 612 7 000 7 000 Application of Funds 1. Infrastructure 1,514 1,883 641 2. Refuse Equipment 303 329 3. Community Facilities 530 1,015 580 4. Aerial Photography and Mapping 120 5. Detailed Design & Construction Supervision 249 161 229 96 6. Management 233 269 325 178 7. Training/Technical Asstc./Studies 65 365 504 122 4 8. Land Adjudication: Equipment & Operation 42 86 118 118 59 9. Maintenance MCC Project Assets 16 32 36 37 37 37 37 37 37 10. Govt. Share Property Taxes (70%) 1,330 1,463 1,756 2,282 2,967 3,857 4,628 4,900 4,900 11. Repayment COL Revolving Fund 300 12. Debt Servicing 54 130 190 216 216 351 337 322 308 TOTAL APPLICATIONS 1,012 .45654 6 36717 2,894 3 4,245 5,002 5 5,245 Annual Balance 150 650 465 526 425 1,019 1,265 1,610 1,741 1,755 Cumulative Balance 150 800 1,265 1,791 2,216 3,235 4,500 6,110 7,851 9,606 /a Increase of collections assumed at 10% in 1983, up to 30% by 1985, leveling off to target level of $7mm by 1989. |a  Monrovia Urban Development Project Table IV-7: MCC - FORECAST INCOME AND EXPENDITURES 1981-1985 ON MAINSTREAM OPERATIONS (US$'000) 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 Income-/a 1. Cemetery Fees 37 45 55 67 82 100 122 149 182 222 2. Garbage Fees 35 43 52 64 78 95 115 141 172 210 3. Court Fines 14 17 21 25 31 38 46 56 69 84 4. Market Fees 13 16 19 24 29 35 43 52 64 78 5. Other Income 45 55 67 82 100 122 148 181 221 269 TOTAL INCOME 144 176 214 262 320 390 474 579 708 863 Recurrent Expenditures/ 1. Department of Sanitation 849 993 1,162 1,360 1,591 1,861 2,178 2,548 2,981 3,488 2. Department of Traffic 179 209 245 287 335 392 459 537 629 735 3. Other Departments 319 373 437 511 498 699 818 957 1,120 1,311 4. City Court 27 32 37 43 51 59 69 81 95 111 5. Garage 47 55 64 75 88 103 121 141 165 193 6. City Hall Maintenance 22 26 30 35 41 48 56 66 77 90 7. Supplies 67 78 92 107 126 147 172 201 235 275 8. Miscellaneous 30 35 41 48 56 66 77 90 105 123 Sub-Total (Recurrent Expenses) 1,540 1,801 2,108 2,466 2,886 3,375 3,950 4,621 5,407 6,326 Development Expenditures 1. Sanitation 402 300 160 225 2. Public Toilets 18 21 25 29 34 39 46 54 63 74 3. Markets - 75 30 35 41 48 56 66 77 90 105 4. Monrovia Transit Authority - 250 _ _ Sub-Total (Development Expenses) 745 51 60 70 382 95 272 131 378 179 TOTAL EXPENDITURES 2,285 1,852 2,168 2,536 3,268 3,470 4,222 4,752 5 6,505 ANNUAL SURPLUS/DEFICIT (1 (1,676) (1,954) (2,274) (2,948) (3,080)(3,748) (4,173) (5,077) (5,642) (GOVERNMENT FUNDING REQUIRED) - - __- /a Inflation assumed at 15%, growth at 7%. lb Inflation as above, growth assumed at 2%. /c MTA will be financially autonomous. 0 '-  LIBERIA URBAN DEVELOPMENT PROJECT Table IV-8: Total Project Cash Flow Requirements Offset by Property Taxes, 1981-1990-' US$S'000 1981 1982 1983 1984 1985 1986 1987 1988 19891 Sources 1. MCC Revolving Fund 150 150 2. 1BRD loan disbursements 1,584 2,498 2,974 1,419 182 - 3. Government Project Funds 453 728 991 533 83 - - --_ 4 Property Tax 2/ 1.900 2.090 2.508 3.260 4.239 5.510 6.612 7.000 7.000 Total Sources 2,187 5,276 6,055 4,460 3,525 4,239 5,510 6,612 7,000 7,000 Anolications 1. Infrastructure - 1,167 1,452 494 2. Co=pensation 282 - - - 3. Co-,unity Facilities - 530 1,015 580 4. Refuse Equipment 303 329 - - - _ _ _ 5. Aerial Photography 120 - - - - - - - 6. Land Adjudication 335 405 440 482 265 - - - - - 7. Management 233 269 325 178 - 8. Technical Assistance, Training & Studies 515 365q 504 122 . - - - - . - 9. Detailed Design, Engineering & Construction Supervision 249 161 229 96 10. Maintenance _ 5 32 59 67 67 67 67 67 67 11. Repayment Revolving Fund 300 12. Debt Servicing IBRL' Loan _ 205 426 689 815 831 1,408 1,353 1,297 1,242 13. Debt Servicing Governemlent 61 125 214 261 268 454 436 418 400 Total Applications 2,037 3,497 4,548 2,914 1,708 1,166 1,929 1,789 1,715 1,642 Annual Surplus/Deficit 150 1,779 1,507 1,546 1,817 3,073 3,581 4,823 5,285 5,358 Annual Surplus as % of Total Property Taxes N.A. 94 72 62 56 72 65 73 76 77 1i For 852 of project investments. 2/ See Table 7 for assumptions  - 47 - V. JUSTIFICATION AND RISKS 5.01 The proposed project would create a range of benefits--both quanti- fiable and otherwise. The most difficult to quantify, but potentially impres- sive benefits are those resulting from land adjudication. Establishment of a land registry will improve security of land tenure in Monrovia, which in turn should encourage improvement and maintenance of Monrovia's severely dilapi- dated stock of residential and commerical structures. It may also stimulate new construction and should reduce the incidence of abandoned house-starts, thus conserving and better utilizing Liberia's scarce investment capital. Once complete, it will remove a major impediment to the development of an effective housing finance system, an essential complement to the efforts now underway by NHA and NHSB, assisted by USAID. 5.02 Of equal importance, land adjudication will formulate the basis for improved government revenues through more effective property taxation, a presently much underutilized source. These revenues should begin to be realized by the last year of the project's implementation. Given Liberia's current and projected financial constraints, this represents an important benefit. Estimates of additional resources that could be mobilized are provided in para. 4.29 above. A further possible effect of the enforcement of property taxes may be the eventual reactivation of Monrovia's dormant land market with a gradual increase in the supply of centrally-located land for development and redevelopment. 5.03 Development of the institutional framework in the urban sector through support for the Monrovia City Corporation should begin to strengthen municipal management. This represents a long-term objective towards which the project will make a beginning. Specifically in the shelter and service sectors, the project together with the LEC, LWSC and NHA-USAID programs will provide more affordable urban services to increasing numbers of low-income households and promises greater prospects for replicability than previous shelter and service programs based on higher unit costs and greater government outlays. 5.04 As noted in Chapter II, the project will directly improve the living conditions of about 100,000 people, or perhaps 20,000 households representing nearly a third of the total population of Monrovia. About half of the population affected falls below the urban poverty threshold. About 30,000 people on 10% of the city will benefit from the comprehensive upgrading of essential urban infrastructure in three poverty areas, the provision or improvement of community facilities in these areas and the construction and expansion of markets. Another 40,000 or 13% will receive basic improvements in their access to clean water through extension of LWSC's standpipe program and an additional 10% or 30,000 land tenure through the land adjudication process. At the present pace it would take a little over 20 years to bring comprehensive improvements to the 22 settlements needing them. That pace, however, should accelerate as a result of the project making the task achiev- able in perhaps 15 years.  - 48 - A. Economic Analysis 5.05 Economic rates of return were calculated for the three upgrading areas of Claratown, Sonewein and Slipway by analyzing the present and expected market values for housing and infrastructure improvements. Property values provide a simplified, though measurable indicator of project benefits. Other effects, such as improved health and education, are expected to have a sub- stantial impact on morbidity, mortality and labor productivity. Only minimum further densification, in terms of the total number of houses per site is included in the analysis. Thus, the calculated rates of return are on a conservative measure of the economic benefits of the project. 5.06 In calculating rates of return, the following costs have been included in the analysis: (a) Land; (b) On-site development costs, including detailed design and engi- neering, construction supervision and physical contingencies; (c) Compensation costs for displaced residents; (d) Allocated shares of administrative and management costs; and (e) Maintenance costs, estimated at 2% p.a. of infrastructure costs. Costs of community facilities and markets to be built in the project areas were not included in the analysis. These facilities will provide city-wide benefits. 5.07 Imputed rental values for housing in the project sites were obtained by surveys during the project preparation study. An updated spot survey was carried out by the appraisal mission, resulting in the following estimates: Imputed Rental Values (US$ per room per month at January 1981 prices) Without project With project Claratown 20 26 Sonewein 18 23 Slipway 22 29 The three upgrading schemes combined would yield an aggregate rate or return of about 12%. This rate of return is relatively modest since land values do not reflect any real increase and are therefore somewhat understated. 5.08 Sensitivity tests, reflecting + 10% changes in expected costs and benefits affected the rates of return only minimally.  - 49 - B. Risks 5.09 This project entails considerable risk which we have attempted to bring within acceptable limits during the process of its preparation and design. The major risks are (a) the adequacy of the MCC as executing agency, (b) the chance of delays in completing land adjudication significantly post- poning start-up of cost recovery, (c) the possibility of upgrading increasing rents above what is affordable and thereby displacing residents in affected areas, and (d) the overall difficulty of the Liberian situation. 5.10 The Monrovia City Corporation is a relatively young agency which, until recently, has carried limited responsibility. The legal jurisdiction, professional staffing, budget and control and revenue base of MCC at present are imprecise and weak. Moreover, the April 1980 change of government and subsequent exodus of professionals further exacerbated institutional and financial problems throughout the country. 5.11 The project has therefore been focused principally on strengthening two key elements of the urban environment: the municipal institutional capa- city and property taxation system. Physical works, which were modest to start with comprising only upgrading, were further scaled back at appraisal and tailored to what is considered achievable under these circumstances. 5.12 To better carry out its new responsibility the City will be given limited budget control for the first time, and its revenue base will be strengthened through the assignment of collection responsibility and retention of a portion of the property tax in Monrovia. Major technical assistance, training and studies will simultaneously develop the institutional capacity of the City to carry out these tasks over the project implementation period, and consultancy assistance will bolster MCC's immediate professional and managerial skills, focused on on-the-job training as well as performance of specific tasks. The project was specifically designed with this combination of limited project size and an expanded institutional development component to minimize the risk of institutional weakness impairing its progress. 5.13 Delays in land registry represent a second risk which could postpone start-up of cost recovery through the collection of property taxes and make imposition of charging a politically difficult process. Where land ownership or tenure delivery are a precondition to collections such delays are not uncommon in African urban projects. To minimize this risk, all legal require- ments for charging will be in place by Board presentation, and a full year of grace has been introduced between the scheduled completion of adjudication in the three upgraded areas and the start-up of collections. Technical assistance to organize collection mechanics will precede actual start-up by nine months, providing for slippage, and assistance will be available to the adjudication team for 18 months preceding this date. The possibility of such delays has therefore been foreseen and specifically addressed in developing the project-s timetable.  - 50 - 5.14 A third inherent risk exists that, given the extensive rental of land, houses and rooms, and the high incidence of absentee landlords, rents could be driven up beyond the limits of affordability as a result of the upgrading, displacing the original population. This risk has been minimized to the extent possible by the basic standards of proposed services and by LWSC's parallel extension of minimal improvements in standpipe water supply to six additional settlements in Monrovia. Together with USAID-assisted upgrading in West Point and New Kru Town, better services will reach a fairly large population and be less unique, reducing the likelihood of sharp rent increases in any one settlement. 5.15 Finally, the present serious economic and financial situation in Liberia represents a country risk which could ultimately affect the project. The proposed implementation schedule, financing plan and disbursement sched- ule among other features of the project have been designed to avoid as many of the problems which are predictable under such circumstances as possible. Ultimately, however, the country risk is one shared by all Bank lending operations in Liberia and is no more severe in the urban project than in other sectors. 5.16 The proposed project entails clear potential risks. However, these risks have been addressed to the extent possible through the project's design, and are felt to be in line with the expected benefits resulting from its implementation.  - 51 - VI. RECOMMENDATIONS 6.01 Prior to negotiations, the following actions were completed: (a) the Development Project Department (DPD) in MCC was established. Its Director, Deputy Director and Chief for the Engineering and Community Development Sections were appointed (para. 3.15). Conditions of Board Presentation (a) appointment of a chief for the Finance Section of DPD (para 3.15); (b) legal authorization of MCC to implement the project and collect the property tax in Monrovia and to retain initially 30% of the total sum collected net of collection costs (para 4.12); and (c) the establishment of a basic Project Account and Auditing system satisfactory to IDA (para. 4.08). Condition of Disbursement (a) the establishment of a comprehensive system of project accounts and audits satisfactory to IDA for disbursement on all items for which a statement of expenditure will be used (para 4.08). Condiltions of Effectiveness (supplementary to the General Conditions) (a) the execution and delivery of all project and subsidiary agreements; and (b) the establishment of a revolving fund, including a deposit of $100,000 by GOL in a Project Account (para. 3.14) and the opening of a Special Account for a $300,000 IDA revolving fund. 6.02 During negotiations the following major agreements were confirmed: With respect to MCC that: (a) spending authority will be vested with the City for funds under this project and government will ensure the establishment of a revolving fund including a $100,000 deposit by Government in a Project Account (para. 3.14) and the opening of a Special Account for a $300,000 IDA revolving fund (para. 6.01). Suitable controls of these funds were agreed during negotiations (para. 3.14);  - 52 - (b) MCC will prepare an opening financial statement in a form satis- factory to IDA by April 1, 1982, reflecting its position as of December 31, 1981, and will thereafter submit annual accounts of MCC operations, including a separate account of project expen- ditures, audited by a firm acceptable to IDA not later than 6 months after the close of each fiscal year (para 3.14); (c) the MCC will assign DPD responsibility for project activities, including: (i) staff control, including hiring, firing and determination of salary levels within MCC-s established range and in accordance with MCC-s general terms and conditions; (ii) inventory control (vehicles, equipment, materials); and (iii) expenditure and commitment authority including establishment of its own bank account (para 3.17); and (d) MCC will discuss and agree with IDA each year the targetted annual increase to be achieved over the present level of collections (para. 4.23). With respect to NHSB that: (a) for lower-income owner occupiers wishing to borrow sums below US$3,5Q0, normal requirements for savings accounts, and life and fire insurance will be waived in exchange for a government guarantee or authority to add a 1% risk surcharge to their interest rate on these loans, and that a long-term lease will be accepted in place of land title which would not be obtainable in most resettlement areas (para 3.24); With respect to Government that: (a) Government shall maintain the Steering Committee, established in September 1979, which guided project preparation; the Committee would operate under the chairmanship of the Minister of Local Government and would consist, in addition, of representatives of all ministries and agencies concerned with the carrying out of the Project. Thus, its membership would include MLG, MCC, NHA, NHSB, LEC, LWSC and the Ministries of Planning, Justice, Lands and Mines, Public Works, Finance, Education and Health and Social Services (para. 3.02); (b) government will adequately staff, operate and maintain infrastruc- ture and community facilities built under the project (para 3.36); (c) the compensation policy for land and structures applied in project sites will be satisfactory to IDA (para. 2.19);  - 53 - (d) on-site water and sewerage infrastructure will be transferred to LWSC at an asset value to be agreed between LWSC and government provided that a revised tariff structure has been introduced which would enable the LWSC to meet the attendent debt service on these assets and to cover recurrent costs (para. 4.05); (e) on an experimental basis, households utilizing water from standpipes in project areas will pay for water consumed. The amount to be paid together with the method of collection will be the subject of a tariff study to be undertaken by LWSC. No later than December 31, 1984, IDA and GOL shall review the need to apply such charges to users of all water standpipes, or to eliminate them. Meanwhile, until such collections are demonstrated to be reasonably effective, government's obligation under the Bank's ongoing First Water Project (No. 859-LBR) to pay LWSC for water consumed at standpipes will continue (para. 4.15); (f) the seven land adjudication teams will be maintained at full strength of six persons each including new positions during project implemen- tation, with qualified and competent personnel and that four of the seven teams will be assigned to Phase I in project areas until its completion (para 3.27); and (g) follow land adjudication procedures and compensation policies satisfactory to the Association, including the closing of adjudica- tion areas as permitted by the Act to amend the Property Law approved May 20, 1974. 6.03 Subject to agreement on the above, this project is recommended for an IDA credit of SDR 8.9 million.  - 54 - ANNEX 1 LIBERIA Monrovia Urban Development Project SELECTED DOCUMENTS ON THE PROJECT FILE A. Documents Produced by the Government of the Republic of Liberia. Al. Statistics of Education in Liberia. 1974. A2. Population and Housing Census. 1974. A3. Social and Income Surveys 1978-1979. A4. Socio-Economic Conditions and Attitudes of Residents of Five Areas in Monrovia. 11/79. A5. An Act to Amend the Property Act to Provide a New System for Registration of Land and for Dealing in Land so Registered. 7/74. A6. Title 36: Revenue and Finance.Law (Part of an Act). 7/77. A7. An Act to Create the National Housing Authority (with Amendment). 1960. A8. An Act to Repeal the Act Creating the Commonwealth District of Monrovia and to Create in Lieu Thereof the City of Monrovia, County of Montserrado and to Grant it a Charter (1973). A9. An Act to Amend the Act Creating the City of Monrovia a Body Politic and to Provide for a Municipal Corporation to be Known as the Monrovia City Corporation (Draft). AIO. Annual Report of the Monrovia City Corporation. 1978. All. Four-Year Development Plan of the.Monrovia City Corporation. 1976-1979. A12. A Handbook for Mayors and Councilmen of Liberian Cities. B. Reports and Papers Prepared by World Bank Staff and Consultants. Bi. Liberia: Education and Training Review Memorandum. IBRD. (2620a-LBR). 11/79. B2. Republic of Liberia. Draft Appraisal Report: Monrovia Water Supply Project, IBRD. (1981-LBR) 11/78. B3. Monrovia Water, Power and Urban Projects: Analysis and Strategies for Improved Access to Services by the Urban Poor. IBRD. 10/80. B4. Liberia: Informal Sector Employment--Preliminary Findings and Recommendations for Bank Assistance. R. Blayney, Consultant. 6/79. B5. Liberia Urban Project: Housing Component Identification Mission Report. R. Samayoa, Consultant. 5/79. B6. Monrovia Urban Development Project: Identification of Appropriate Transport Components. G. Brian Parker, Consultant, 1/80. B7. Waterside Streets and Drainage Assessment. K.W. Huddart, Consultant, 1/80. B8. Street Lighting. K.W. Huddart, Consultant, 1/80. B9. Preappraisal Mission: Engineering Review. R.G. Evans, Consultant, 8/80. B10. Liberia, First Urban Development Project: Executing Agencies. L. Victor Smith, Consultant, 9/80. Bll. Liberia, Urban Development I: Review of Land and Cost Recovery Issues William A. Doebele, Consultant. 8/80.  - 55 - ANNEX 1 Page 2 B12. Use of Property Tax as a Vehicle for Cost Recovery in Monrovia Upgrading. William A. Doebele, Consultant. 1/81. B13 Working Notes--Local Bidding Procedures; Compensation Policy and Procedures; Training, Technical Assistance and Studies; Land Adjudication Costs, Populations and People Affected; MCC Responsibilities; Incomes and Poverty; Cost Recovery; House Loans Compensation; Detailed Costs; Water Study-TOR; Water Franchise Fee; Market Management Study-TOR; Community Centers/Collections Offices; Health Care; Primary Schools; Markets. C. Other Reports. Cl. USAID Shelter Programs Home Guarantee Loan Programs. USAID C2. Liberia: Low-Income Shelter Housing Policy Guidelines. USAID. 1/80. C3. Assistance to the National Housing Authority: Project Findings & Recommendations. U.N. 1975. C4. Monrovia Urban Development Study. (Working Papers; Inception Report; Final Report). Shankland Cox Partnership, Consultants. 1977. C5. Monrovia--Liberia Urban Development Project, MUDP January 1980 Draft Final Report.   PHOTOGRAPHS CLARATOWN Monrovia Urban Development Project preparation team members discuss land tenure problems and project proposals with Elders and Trustees of Kru-Grebo Community in Claratowvn. Land reclamation is evident along the swampy lowlands of Stockton Creek. Beiow-house footings can be seen wvhich W, were built during the dry season. The new ,Aj house wi ll eventually stand above flood . level but access will be diff icult. inside shot of Ciaratown school. Six older t' ' >\ '- , ,, '' A;} .'' a H p ' ';' I .' '' children share a six-foot bench within an overcrowded annex of a rented church building. _, ' -,,'- i3 i',:*;9t$ >~~~~~~~~~~~~~~~~~~~~~','. .'   SONEWEIN Rawv sewage discharges from a broken cement pipe at the top of the settlement. 2 '24 -I ~ Heavy rains and overflows from broken water taps wash new sewage from the ab ' ve broken pipe through the Sonewein area creating a serious health hazard. The crowvn of this asbestos cement sewver pipe in Sonewein has caved in and the pipe filled in to the extent that it is no longer functional. +'-' .' '   - 58 - LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT IMPLEMENTATION SCHEDULE Calendar Year 1981 1982 1983 1984 1985 Quarter 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 UPGRADING DESIGN Block Mapp,ng /LEC- LWSC) Aerial Photog, and Mapping M Select Consultants Detailed Design and Engmeering_ Prequalification Community Briefings RESETTLEMENT _ _ TENDER AND AWARD CIVIL WORKS Claratown Water and Sewerage K Wet Cores, Roads, Drainage Commuunity Faclities Sonewetin Water and Sewerage Wet Cores, Roads, Dratage Community Fac lities Slipway Water and Sewervge Wet Cores, Roads, Dr, nage - m - r Community Fac,lities COLLECTIONS Houwe Regisiration Staffing, Traming, Regssry Start-up Collections REFUSE XCR Study and Procurement Supply LWSC STANDPIPE PROCRAM Design, Engineering, Tender, Award Construction LAND ADJUDICATION PHASE I: PROJECT ARE AS Demarcation |i Control and Survey Adjudication r PHASE tl CITYWIDE -_ _ - _ - _ - STUDIESTRAINING AND (ECH ASSTC | U STUDIES TOR Municipal ManagementTOR LWSC Tariff Secord Project Preprats| TRAINING i | i TECHNICAL ASSISTANCI Collections T IR MCC - - World Bank 22476  - 59 - Table 22403 LIBERIA Monrovia Urban Development Project SCHEDULE FOR KEY INSTITUTIONAL MEASURES FOR MCC Cal. Year 1 981 19 2 Quarter 1 2 3 4 1 2 Establishment of MCC's DPD N Appointment of Project Director N Appointment of DPD Section Chiefs B Legal authorization of MCC to implement the project and collect property tax and retain 30% B Agreement on a Timetable for transferance of Treasury collection staff to MCC Dec. 31 1981 Provision of the FY82 counterpart funds & MCC's revolving fund B Agreement on Reporting and Controls on the Sept.30, Revolving Fund 1981 Establishment of MCC's DPD Accounts and Audit System D Preparation of an opening financial statement for April 1 MCC 1982 ~~~~~~_, __ ,,_- m KEY N - - - Conditions of Negotiations. B - - - Conditions of Board Presentation. D - - - Condition of Disbursement.  - 60 - LIBERIA Monrovia Urban Development Project Table 22400 INSTITUTIONAL RESPONSIBILITIES Agency with Primary Subcontractor Task Responsibility or Consultant I. PROJECT IMPLEMENTATION PHASE UPGRADING a. detailed design engineering, and supervision MCC/DPD - consultants - LWSC & LEC to review designs tender documents, construction spn and approve final payment - or alternately do the work if preferred b. civil works construction - contractors c. community development t- d. collections " _ e. monitoring/evaluation - university & local consultants f. house loans for essential resettlement NHSB TRAINING, TECHNICAL ASSISTANCE & STUDIES MCC/DPD - consultants for certain items LAND ADJUDICATION a. special project - contract to ML&M b. Monrovia-wide adjudication ML&M - MCC/DPD to procure major equipment PROJECT SUPERVISION MLG II. OPERATION/MAINTENANCE PHASE a. roads, drainage Min. Public Works - & MCC b. electrical lines LEC c. water, sewers LWSC d. showers, toilets & MCC franchise to private water kiosks individuals e. schools MCSS f. clinics & health posts MH g. community centers Neighborhood Development Associations h. markets MCC i. refuse removal MCC  LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT ,MCC ORGANIZATION | MAYOR l r~~------l . l imimuumm. URBAN DEVELOPMENT MAYOR'S LEGAL COUNSEL 'STEERING COMMITTEE ADVISORY BOARD DEPUTY MAYOR r -t--- - --= DEPT. OF URBAN DEPT. OF TRAFFIC DEPT. OF HEALTH DEPT. OF BEAUTIFICATION DEPT. OF PLANNING DEPT. OF FINANCE DEVLOPMENT AND PUBLIC SAFETY AND SANITATION AND RECREATION AND WORKS AND PERSONNEL PROPOSED NEW DEPARTMENT CEMETERY GARAGE MARKETS CITY COURT | oAUTHORITY (SEMI-AUTONOMOUS AGENCIES) mmommMmExisting _ _ Propowd World Bank - 22464  LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT MCC DEVELOPMENT PROJECTS DEPARTMENT (DPD) DEPARTMENT [LDIRECTOR | I DEPUTY ADMINISTRATIVE UNIT - TRAINING/TECH. ASSTC. OFFICER - OFFICE MANAGER AND TYPING POOL - OPERATIONS ADVISOR TECHNICAL SECTION |COMMVUNITY DEVELOPMENT .FINANCE SECTION DESIGN CONSTRUCTION INFORMATION FIELD HEALTH AND ACCOUNTING PROCUREMENT COLLECTIONS SLUPERVISION AND PUBLICITY TEAMS HYGIENE B l World Bank -22465  LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT MINISTRY OF LOCAL GOVERNMENT, RURAL DEVELOPMENT, AND URBAN RECONSTRUCTION MINISTER SPECIAL ASSISTANT LEGAL ADVISOR DEPUTY MINISTER FOR DEPUTY MINISTER FOR DEPUTY MINISTER FOR RURAL DEVEL OPMENT LOCAL (COUNTY & TERRITORIAL) GOVERNMENT URBAN RECONSTRUCTION _ SUPERVISIONN PROGRAM DISTRICT COUNTY TERRITORIAL PROGRAM I UNIT FOR I ADMINISTRATION SUPERINTENDENT SUPERINTENDENT SUPERINTENDENT ADMINISTRATION MCC URBAN I _ o ,_~~~~~~~~~-- PROJECT_, COUNTY MUNICIPALITIES/ COUNTY SUB-COORDINATOR TOWNSHIPS SUB-COORDINATOR RURAL DEVELOPMENT F IIIE -- RURAL OPMENTE COMMONWEALTH URBAN DEVELOPMENT | COMMITTEE I DISTRICTS I COMMITTEES I COUNTY | COMMISSIONER Existing NATIONAL HOUSING AUTHORITY - _ SProposed ( (SEMI-AUTONOMOUS) I REPORTS TO DEPUTY MINISTER World Bank - 22463 FOR URBAN RECONSTRUCTION  LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT MINISTRY OF LANDS AND MINES MINISTER TECHNICAL ASSISTANCE UNIT TRAlNIN i DEPUTY MINISTER DEPUTY MINISTER | PERSONEL FR FOR ADMINISTRATION SERVICES PROCUREMN ASSISTANT MIINISTER ASSISTANT M IN I STER ASSISTANT M IN ISTER FOR FOR FOR RESOURCE DEVELOPMENT LAND SURVEYS EXPLORATION AND AND CONSERVATION AND CARTOGRAPHY RESEARCH DIRECTOR DIRECTOR DIRECTOR DIRECTOR DIRECTOR DIRECTOR MINING CONCESSIONS LANDS CARTOGRAPHIC HYDRO- GEOLOGICAL HYDRO- SERVICES APPRAISAL SURVEYS SERVICE ICSERVICES CARBON | LANW D |ADJUDICATION| |DIVISION l World Bank -22486  - 65 - LIBERIA MONROVIA URBAN DEVELOPMENT PROJECT NATIONAL HOUSING AND SAVINGS BANK V.P. CREDIT V.P. CUSTOMER V.P. OPERATIONS AND MARKETING SERVICES CREDIT AND ASISTANT MANAGER OPERATIONS ENGINEERIING MARKETING OPTRZTO MANAGER CSTOMER SERVICES CMUEZAIN MANAGER |{ SAFE DEPOSITS | "| GENERAL ITS] ~ ~~~~~SERVICES NEW ACCOUNTS BOOKKEEPING hLETTERS OF . ESNE CREDIT ~~~~~~PERSONNEL L REMITTANCES] | |PAYING AND RECEIVING ACCOUNTING FILING World Bank - 22523  - 66 - Table 22401 LIBERIA Urban Development Project MCC BUDGETS FY78-FY81 (US$'000) 1978 1979 1980 1981 I. EXPENDITURES A. Recurrent Office of the Mayor 58 60 65 62 Department of Finance 16 21 40 57 Department of Health 252 252 357 841 Garage 19 21 23 49 City FHall 12 12 13 22 Department of Recreation 17 19 23 113 City Court 21 22 22 29 Department of Traffic 26 56 179 179 Markets 5 6 6 26 Department of Works 11 13 26 63 Other Services 37 55 51 28 Supplies 133 115 88 67 Sub-Total 607 *653 893 1,536 B. Development Personnel 218 Sanitation 353 220 402 Project Preparation 50 Markets 17 75 Toilets 18 Street Lights 464 332 Mass Transit 169 250 Sub-Total NA 817 1,006 745 TOTAL 607 1,470 T-7g 2,2-81 % Increase +240% +29% +20% II. INCOME A. MCC Revenues Cemetery Fees - - 37 37 Traders Registration Fees - - 25 Market Fees - - 13 13 Court Fines - - 8 14 Garbage Fees - - 27 35 City Hall Rents - - 8 8 Bill Board Fees - - 2 2 Other Income - - 43 30 Sub-Total NA NA 138 164 B. Government Subvention 607 1,470 1,761 2,117 TOTAL 607 1,470 1,899 2,281  - 67 - Table 22402 LIBERIA Monrovia Urban Development Project NATIONAL HOUSING & SAVINGS BANK (NHSB) FINANCIAL STATEMENTS 1977-1979 (US$'000) /a 7 Months to 1977- 1978 1979 July 1980 INCOME AND EXPENDITURE Interest Income 468 1,616 5,855 Interest Expenses 236 519 4,613 Interest Net 232 1,097 1,242 Other Income 41 133 1,998 Total Income 273 1,230 3,240 Operating Expenses 470 778 2,247 Net Profit (Loss) for year (197) 452 993 BALANCE SHEET Assets Cash and Bank 6,922 3,403 20,136 12,754 Loans 6,517 26,420 51,372 48,792 Accrued Interest 92 380 1,258 1,107 Receivables 29 38 65 149 Preliminaries 117 107 96 139 Fixed Assets 939 1,166 1,193 10,533 Total Assets 14,616 31,514 74,120 73,474 Liabilities Deposits - Demand 4,150 6,481 13,648 11,057 Deposits - Savings 2,797 5,004 7,227 7,254 Deposits - Time 1,388 4,726 10,632 4,205 TOTAL DEPOSITS 8,335 16,211 31,507 22,516 Increase/(Decrease) % 95% 94% (29)% Accrued Expenses 141 336 1,112 1,500 Payables 1,606 2,377 640 560 Loans - 7,604 34,882 42,919 Shareholders Surplus 4,534 4,986 5,979 5,979 Total Liabilities 14,616 31,514 74,120 73,474 /a Year to December 31.  , ~~~~~~~~~~~~~L I B E R I A 0 (a f\\\ E .\ ,- '\- - ~~~~~MONROVIA URBAN DEVELOPMENTI A T Z A N 7 C P .AROJN.s : X;SECT :1E, p/ . 0~~~~~~~ g X 'i_ EAt-lpy A N 'J X TZ t 0 X j B J S rE j 1 5 X R;d " f == ;R CE 1 f \ = - P- J 4d m- . i ;; t * / tffl t i f t ~~~~~~~~~~~~~~~~~~~~~j*r -#r:Mrre.JP 0 0 0 4 = J'5 ' == 00 t ;\==-4N; - ~~a rn/;XJ 0 S tC X bVSS) bY,2.b[,2,5hiut;0(N'(RnN~~~~F3" [:ETi~~~~~~~~~~~~~~~~~N K,T . 4 L . C ::, f 0 '. : ' ' ' ' ' ' | ' C'~~~~~~~~~~~~~~F- T- 4 t; T . t; * X t ; X =,i, t Ej- R; i 1 M F