Tunisia - Third Urban Sewerage Project

Documt of The World Bank FOR OFFMCAL USE ONLY Report No. 13419 TUNISLA THIRD URBAN SEWERAGE PROJECT (LOAN 2255-TUN) PROJECT COMPLETION REPORT AUGUST 2, 1994 Infrastructure Operations Division Country Department I Europe Middle East and North Africa Region This document has a restricted distribution and tnaY be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EOUIVALENTS (As of January 1994 ) Currency Unit = Tunisian Dinar (TD) = 1,000 Millimes TD 1 = US$1.587 US$1 = TD 0.630 ABBREVIATIONS ft = foot m3/s = cubic meters per second lcpd = liters per capita per day Mm3 = million of cubic meters m = meter mm = millimeter s = second gil = gram per liter MEASURES AND EQUIVALENTS Metric System US System Kilometer (km) = 0.62 mile (ml) Hectare (has) 2.47 acres (a) Meter (m) = 39.37 inches (in) Cubic meter (m3) = 264 US gallons (gal) Million cubic meters/year (Mm3/year) = 0.72 million US gallons per day (mgd) Liter (1) = 0.264 US gallon (gal) Liters per second (1/s) = 22,800 US gallons per day (gd) GLOSSARY OF ACRONYMS AFESD = Arab Fund for Economic and Social Development EEC = European Economic Community GTZ German Agency for Technical Cooperation; Deutsche Gesellschaft fur Technische Zusammenarbeit IBRD = International Bank for Reconstruction and Development IDA = International Development Bank IDB = Islamic Development Bank KfW = German Bank for Reconstruction; Kreditanstalt far Wiederaufbau NIS = National Institute of Statistics OED = Operations Evaluation Department ONAS = National Sewerage Office GLOSSARY OF ACRONYMS (continued) ONTT = National Office of Tourism of Tunisia (Office National du Tourisme Tunisien) SFD = Saudi Fund for Development SIDA = Swedish International Development Agency SMIC = Minimum Wage; Salaire Minimum Interprofessionnel de Croissance SONEDE = National Water Distribution Company; Societe Nationale d'Exploitation et de Distribution des Eaux USAID = United States Agency for International Development ONAS' FISCAL YEAR January 1 - December 31  FOR OFFICIAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Office of Director-General Operatlons Evaluation August 2, 1994 MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Project Completion Report on Tunisia Third Urban Sewerage Project (Loan 2255-TUN) Attached is the "Project Completion Report on Tunisia - Third Urban Sewerage Project (Loan 2255-TAN)" prepared by the Middle East and North Africa Regional Office, with Part II contributed by the Borrower. The project was part of sustained Bank support for the water supply and sewerage sector in Tunisia. Its physical scope and financial objectives exceeded the capacity of the implementing agency and, after three one-year extensions, the project was completed after loan closing with the agency's own funds. In technical terms, it was highly successful and sustainability of the benefits is assured. The financial objectives set for the project were unrealistic but, nevertheless, substantial progress was achieved. Studies to formulate realistic cost recovery policies are being carried out. The outcome of the project is rated as satisfactory, sustainability as likely and institutional development as substantial. The quality of the PCR is excellent, with full assessment of the problems and appropriate conclusions and lessons to be drawn. The project may be audited. Attachment This document has a restricted distribution and my be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without WorLd Bank authorization.   TUNISIA THIRD URBAN SEWERAGE PROJECT (LOAN 2255-TUN) PROJECT COMPLETION REPORT TABLE OF CONTENTS PREFACE EVALUATION SUMMARY ........................ i PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE. 1 Project Identity .........................1........... Project Background ............. 1 Project Objectives and Description. 2 Identification, Preparation, Appraisal of the Project and Negotiation of the Loans. 3 Project Implementation ............................... 4 Project Results. 7 Institutional Strengthening .10 Bank Performance ................................. 10 Borrower's Performance ................. 11 Project Relationship ................ ................ 11 Consultants' Services ................. 11 Project Documentation and Data ........................ 11 Recommendations ......... ................ 12 PART II: PROJECT REVIEW FROM THE PERSPECTIVE OF ONAS PART III: STATISTICAL INFORMATION Missions Status of Legal Covenants Evaluation of Number of Bidders Monitoring Indicators Income Statements Cash Flow Statements Balance Sheets Implementation Schedule Withdrawals Loan Disbursements Current Organizational Chart   TUNISIA THIRD URBAN SEWERAGE PROJECT (LOAN 2255-TUN) PROJECT COMPLETION REPORT PREFACE 1. This is the Project Completion Report (PCR) for the Third Urban Sewerage Project, for which Loan 2255-Tun in the amount of US$34.0 million was approved on March 29, 1983. The loan was signed on June 16, 1983 and became effective on August 30, 1984. The loan was closed on December 31, 1992, after three one year extensions. US$33.1 million of the loan was disbursed, with the last disbursement was in May, 1993. US$0.9 million were cancelled. 2. The PCR was jointly prepared by the Infrastructure Operations Division, Maghreb and Iran Department, Middle East and North Africa Regional Office (Preface, Evaluation summary, Parts I and III) and the Borrower (Part II). 3. Preparation of this PCR was started during the Bank's last appraisal mission for the Eighth Water Supply project in December 1993 and was completed in headquarters. It is based, inter-alia, on the Staff Appraisal Report, the Loan and Project Agreements, the supervision reports, the quarterly progress reports, correspondence between the Bank and the Borrower and internal Bank memoranda.   TUNISIA THIRD URBAN SEWERAGE PROJECT (LOAN 2255-TUN) PROJECT COMPLETION REPORT EVALUATION SUMMARY Objectives 1. The project's major objectives were to: (a) rehabilitate, upgrade, and expand sewerage systems in some thirty secondary centers, including sewage treatment and promotion of treated effluent reuse for irrigation; and (b) improve the management of the subsector through the strengthening of the financial, technical and managerial aspects of ONAS (para. 3.0). Implementation 2. The loan was declared effective on August 30, 1984, 16 months after Board presentation (para 4.5), but works did not start up until the end of 1985. Project implementation got off to this late start because of delays and revisions of studies, as well as cumbersome local procurement methods. Implementation remained slow, as the workload was somewhat above ONAS's capacity, in particular for a complicated project with a vast geographical distribution (para. 5.2). In addition, the project was subject to quite a few modifications to suit changing circumstances and conceptions (para. 5.3). Also, ONAS's liquidity problems were not conducive to speedy implementation. At the time of the final closing date, after three one-year extensions, 84% of the project was completed. The remainder has since been completed with financing from ONAS and the Government. 3. Apart from the delays, the project was implemented efficiently under the supervision of ONAS. Contractors and consultants performed satisfactorily and ONAS supervised the staff extremely well (para. 5.4). 4. The project's institutional component has encountered delays in implementation similar to those experienced by the works component, but ONAS's access to improved maintenance equipment, data processing equipment, and office facilities had a catalytic effect on its overall management efficiency. Results 5. The project successfully met its objectives to improve access to sewerage services in 30 cities and to protect the environment from the discharge of untreated sewage.  - 11 - However, the result is somewhat tempered by the fact that some industries did not hook up to the sewerage system because of the existing requirement that they put a pre-treatment device in place before connecting to the system to avoid disturbing the biological treatment process of ONAS's treatment plant. New legislation making pretreatment and hookup compulsory is being drafted and financial support to industries is envisaged (para. 6.0). 6. The promotion of treated effluent reuse for irrigation is a delicate venture. To date, only 13% of the effluent is reused. This is because only a limited number of crops may be irrigated with treated effluent, and surface water for any irrigation purpose is highly subsidized. The Govemment, ONAS, and the Bank are continuing their efforts to promote the reuse of treated effluent. 7. The project's institutional component was also successful, as ONAS has become the top performer in the Region. On the other hand, the financial expectations at the time of appraisal were too optimistic. Because of ONAS's expanded activities, particularly in smaller and less profitable cities, the phasing out of the Government subsidy has not been possible, notwithstanding substantial tariff increases over the last 10 years (para. 6.9). Sustainability 8. This is the third Bank-financed project implemented by ONAS. In the first project, the Bank assisted in the creation of ONAS, and considerably strengthened in the second and third projects, ONAS's organization and efficiency. ONAS is now a relatively well established institution capable of addressing most customary development issues of the subsector. However, ONAS needs greater autonomy from state interference and sufficient revenues to finance its operations. Findings and Lessons learned 9. The project achieved its goals by providing improved sewerage service to the inhabitants of thirty mid-sized centers and by strengthening ONAS. However, the project was appraised too early as demonstrated by multiple design changes (para. 5.3), which caused major implementation delays (para. 5.1). Appraisal should have been scheduled in such a way that procurement of goods and services would have been sufficiently advanced at the time of Board presentation. In addition, the use of standard bid documents would have helped accelerate implementation. The Bank should have also anticipated ONAS's incapacity to implement a project comprising 30 subprojects in 30 different sites and insisted on the use of consultants for project supervision (para. 5.1). The extended delays and insufficient design at appraisal resulted in a cost overrun of 41% (para.5.2) 10. The main lesson learned is that it is very difficult to reconcile the requirements of a financially independent sewerage authority with its role as a State operator for social projects. These two missions should be kept separate and carried out under different financing arrangements (para. 13.1). In view of the limited capacity of ONAS's clients to  - 111 - contribute to the project financially, a larger municipal contribution should have been envisaged to ease ONAS's financial burden, which was compounded by the need to implement a large investment program to provide minimum sewage services to industries and a growing urban population. A more in-depth cost recovery study should have been undertaken at or before appraisal to assess whether Government subsidies could be phased out and if so, over how long a transition period (para. 13.1). Another lesson learned is that implementation could have been accelerated by making use of standard bid documents, turnkey projects, and outside consultants for project supervision (paras. 13.3-13.5). This study was only carried out towards the end of the project with German financing.   TUNISIA THIRD URBAN SEWERAGE PROJECT (LOAN 2255-TUN) PROJECT COMPLETION REPORT PART I: PROJECT REVIEW FROM THE BANK'S PERSPECTIVE 1. Project Identity Project Name Third Urban Sewerage Project Loan No. 2255-TN Borrower Government of Tunisia Executing agency Office National d'Assainissement (ONAS) Initial Project Cost US$78,480,000 = TD 49,440,000 Final Project Cost TD 70,000,000 Loan Amount US$34,000,000 Division EMENA CPII Sector Water Supply and Sewerage Subsector : Sewerage Project Background 2.0 Tunisia occupies an area of 160,000 km2 in North Africa. The country had a population of 8.4 million in 1992, 5.0 million of which were classified as urban. The annual population growth rate is 1.9%, while that of the urban population is 2.5%. The country is divided into 23 govemorates and has 260 urban agglomerations. The Bank has contributed to the organization of the water supply and sewerage sector by assisting Tunisia with the establishment of two public enterprises; namely the Societe Nationale d'Exploitation et de Distribution des Eaux (SONEDE) in 1968 and the Office National d'Assainissement (ONAS) in 1974. 2.1 Since then, the Bank has regularly provided assistance for these two enterprises and for the development of the water supply and sewerage sector. To date, the Bank has financed seven water supply projects and three sewerage projects in addition to a tourism infrastructure project including significant water supply and sewerage components. Total Bank lending to ONAS amounts to US$88.5 million. 2.2 The volume of water distributed by SONEDE in 1992 w, ' million m3, of which 118 million m3 was gathered by the sewerage systems managed b: 4AS and 95 million m3 was treated in ONAS's treatment plants; only 13% of the trea water was used in agriculture. The objectives of the Eighth Plan (1992-96) are to improN the gathering of  wastewater, strengthen treatment capacity by building new plants, and sell treatment byproducts, viz. treated water and sludge. 2.3 The recent establishment of the Ministry of the Environment and Physical Planning in 1991 and the National Environment Agency (ANPE) in 1988 demonstrates the importance assigned by the national authorities to the environment sector, in which sewerage occupies a key position. Project Objectives and Description 3.0 Project objectives. The project aimed to improve the sanitary situation of some 30 Tunisian towns and strengthen ONAS's capacity by means of: In the sanitation sphere: - Rehabilitation of existing sewerage systems; - Appropriate effluent disposal; - Development of sewerage systems and promotion of connection to sewer systems; - Appropriate stormwater drainage; and - Sewage treatment with a view to reusing it in agriculture and industry. In the institutional sphere: Support for the Government's efforts to provide the sewerage subsector with the necessary technical means and to make it financially independent by means of: - Adoption of a new long-term financial policy that will enable ONAS to finance at least 13% of its investments; - Progressive assumption of responsibility for sewerage in towns of over 10,000 inhabitants; and - Improvement of ONAS's operating capacity by purchase of maintenance and data-processing equipment and the necessary office accommodations. 3.1 Project description. The project components as determined at the time of appraisal were as follows: 3.2 Works: - Construction of about 110 km of primary sewers and 20 pumping stations plus other related facilities; - Construction of about 300 km of secondary sewers; - Construction of about 25 km of stormwater sewers; and  - 3 - Construction of about 12 sewage treatment plants and expansion of one existing plant together with the connection of five towns to existing plants. 3.3 Institutional strengthening: - Supply of maintenance equipment; - Supply of data-processing equipment; and - Provision of office accommodations. 3.4 Studies and supervision: - Provision of consultancy services for the preparation of the detailed engineering; - PProvision of consultancy services for works supervision; - Preparation of feasibility studies for 10 to 15 new centers to be taken over by ONAS, and for promotion of reuse of treated sewage in agriculture and industry. This study consists in a critical review of the data available on agglomerations of over 2,000 inhabitants (in 1975) excluding Tunis and Sfax, and preparing a feasibility study for 10 to 15 new towns and a market study for reuse of treated sewage; and Preparation of studies on computerized data-processing and an information system. Identirication, Preparation, and Appraisal of the Project, and Negotiation of the Loans 4.0 After the first and second sewerage projects, which were partially financed by the Bank and concentrated in Tunis and Sfax, the country's two largest metropolitan areas, and the tourism infrastructure project, the sewerage authorities wished to extend ONAS's services in the sector to the small and medium urban centers. To this end, two projects were identified; the first, which involved 17 such agglomerations, was partly funded by the EEC, and the second, the Third Sewerage Project, is the subject of this report. 4.1 Project identification was based on a general sewerage study covering all agglomerations with over 10,000 inhabitants (in 1978), and its appraisal was based on a specific feasibility study focusing on 30 towns, financed in the context of the second project. This study was based essentially on the sewerage master plan studies that were available for the majority of the towns. The Bank assisted ONAS in drafting the terms of reference and in the followup of this study, which was carried out in the course of 1981/82. 4.2 In the context of the preparation missions, Bank staff visited practically all the project sites and even made some modifications to the project content (at Menzel Bouzelfa, Grombalia, Dar Chaabane, Zaghouan, Nefta, and in the suburbs of Sfax). The Bank engaged a consultant to prepare a socioeconomic report to determine the financial capacity of the low-income residents of the neighborhoods proposed for extensions of the secondary systems  - 4 - and to analyze the project's social impact on this segment of the population. At the time of appraisal, the Bank analyzed ONAS's financial capacity and proposed a tariff policy for progressively eliminating ONAS's financial dependence on the State for funding its operating costs and to enable it to generate resources to self-finance a part of its investment. Actions were also identified for improving ONAS's management and operating system and to help it to better identify its future needs. The project preparation and appraisal time was used to complete the contract award formalities for studies for the systems financed under the Second Project, so that these contracts were signed prior to the signing of the Loan Agreement. 4.3 Negotiations were conducted on February 14-18, 1983, on a loan of US$34 million to the Government with an onlending agreement to ONAS. The two parties agreed to aim for a steady improvement in ONAS's self-financing capacity throughout the period covered by the Seventh Plan (1987-91). To this end, the two delegations agreed to include the following in a supplemental letter: "The Borrower intends to progressively eliminate its compensatory payments to ONAS in the course of the timeframe of the Sixth Development Plan (1982-86)." The two delegations also discussed and defined the terms of reference for the feasibility study and the computerization study and also the planning of project execution covenants. They further drafted the various other covenants pertaining to the loan. 4.4 Loan and Project Covenants. To enable the Bank to track the progress of the project and the accomplishment of its objectives, the Project Agreement included certain requirements to be observed by ONAS. These included, in particular, submission of: (a) quarterly reports on the progress of the project and the movement of the key indicators; (b) audits of project accounts and ONAS's financial statements no later than six months after the close of each fiscal year; and (c) a project completion report no later than six months after the loan closing date. Furthermore, ONAS agreed not to contract any debt, unless the Bank explicitly gave its consent, as long as the debt service coverage ratio did not surpass 1.3. ONAS was also required to generate funds internally equivalent to at least 13% of the annual average capital expenditure for the current fiscal year and of the following year. To comply with that covenant, ONAS would update the compensatory payments made to it by the Borrower, the property area assessment and the sewer tariffs prior to November 30 of each fiscal year. 4.5 Effectiveness. Loan effectiveness was initially set at October 17, 1983, but was postponed three times and finally set at August 30, 1984, i.e., more than 10 months after the initial date. This was mainly due to the long ratification process in the Tunisian National Assembly where various questions were asked by deputies relative to the changing from fixed interest rates on former loans to the variable interest rate on this loan. Project Implementation 5.0 Implementation Schedule and Reasons for Delays. The project was initially programmed for a six-year period (from end-1983 to mid-1989). At the initial loan closing date in 1989, project progress stood at only 60%; construction of the treatment plants had not  -5- yet been started, but system installation, on the other hand, was well ahead and the construction of the administrative offices initially planned had been completed. To enable the project's objectives to be accomplished, the Bank granted three extensions of the loan closing date, which was finally set at December 31, 1992. As of that date the project was 84% complete. ONAS completed the project using local funds. 5.1 The project was got off to a slow start because the first tranche of works were not begun until the end of 1985 instead of the end of 1983, i.e., a two-year slippage. In general, there was an average delay in the order of two years with the startup of the line- laying work. In the case of construction of the treatment stations, the delay was five years. The feasibility and computerization studies were also started six years and five years, respectively, behind schedule. Delays were also incurred in the execution of the works, one to seven months in the case of the line-laying, but longer (about a year) for construction of the treatment plants. 5.2 There were many reasons for these delays. The geographic distribution of the project over 30 towns, in some instances with several sites in the same town, complicated project implementation. The planned workload for the ONAS departments responsible for implementing the project was considerable compared with the number of staff available. Several projects were in progress or under study at the same time. The topographic and geo- technical work for preparation of the studies moved more slowly because the preparation of plans on a scale of 1:500 for all the streets under which the planned lines were to be laid (about 425 km) proved to be a time-consuming undertaking despite the work's being spread among five topographers with whom ONAS had concluded framework contracts. The geo- technical works were covered by only three framework contracts. Moreover, the contracts were not exclusively for this project but were also used for other projects which meant that the topographers and geotechnicians concerned were unable to devote their full attention to ONAS's needs. The contract award procedure was long and slow-moving; it frequently took over six months and became even longer when foreign contractors or suppliers became involved because Central Bank approval then has to be obtained. The opening of bids on several works and supply packages at the same time resulted in heavy workloads for the ONAS staff responsible for bid evaluation, particularly since the number of bidders was generally high. The requirement that the Bank approve each bid dossier individually was also a constraint that contributed to the delays. The project comprised eight line-laying packages and three supply packages of the same nature, with Bank approval being required for each package prior to tender. Toward the end of the project and for certain packages, the Bank asked for changes in the specifications already used without problems for the first packages. The adjustment of the specifications to meet the Bank's new requirements was one of the reasons why these latter packages were started behind schedule. Certain modifications to the project meant that the pertinent studies had to be recast, which also caused additional delays. In addition, there were some land problems that were unforeseeable at the time the studies were made. Since no assessment was available of the different treatment processes used in the existing plants at the time, the choice of processes for the planned treatment facilities was the outcome of extensive consultations with the different ONAS departments and a summary  - 6 - evaluation of the facilities in operation had to be made. Budget constraints were also responsible for the delays in issuing certain calls for bids while a lack of liquidity on ONAS's part occasionally hindered the execution of the works, the Bank financing only 35% of civil works and 56% of local procured goods. 5.3 Modifications Made to the Project. To adapt the project better to the sector's needs and to the various constraints, certain components were modified, as follows: Construction of a new treatment plant for the town of Sahline, which receives part of the sewage from hotels in the tourism zone, instead of connecting this town to an existing station; The feasibility study component not only supported a feasibility study describing the situation of the Tunisian agglomerations with over 2,000 inhabitants and defining their investment needs through the year 2001, but also updated earlier studies of the master plans for Greater Tunis, Greater Sfax, Greater Sousse, Greater Gabes, and Greater Bizerte; - Strengthening of the operating equipment procurement component; - Strengthening of the facilities construction component by, among others, construction of regional workshops in the towns of Sousse, Nabeul, and Sfax; - Minor modification of the system design for the town of Kalaa Sghira owing to land problems, which necessitated construction of a new pumping station; - Addition of a pumping station at Soliman; - Modification of the transport system structure at Menzel Bouzelfa; - Increase of the total treatment plant throughput by about 21%; - Inclusion of facilities for treating oil mill wastewater in certain treatment plants; - Addition of secondary system in the towns of Ksar Hlal, Sfax (Madagascar district), and Sidi Bouzid; - Strengthening of the data-processing equipment procurement component, which included, in addition to purchase of a data-processing and communications system with the pertinent software, a certain number of microcomputers, graphics stations with their software, and also data-processing equipment and software for the maintenance and stock management departments. These purchases were necessitated by ONAS's decentralization policy; Study for a pre-treatment plan for wastewater from an industrial zone in Sfax (powder mill); With a view to utilizing the maximum possible proportion of the unspent loan balance resulting from the sharp devaluation of the dinar, certain supplementary items, such as the acquisition of additional equipment and expansion of the system, were included. 5.4 Contractor and Supplier Performance. Local and international contractors and suppliers performed satisfactorily.  - 7 - 5.5 Procurement. The main bidding procedure used was international competitive bidding, with calls for bids restricted to domestic suppliers or contractors being of minor significance. The bidding documents were submitted to the Bank for approval in each case prior to publication of the call for bids. The calls for bids were commonly not received in time for them to be published in "Development Business Forum." However, as the annexed table shows, competition was good with an average of 8.9 bidders per call. It should be noted that the working drawings for the systems were financed by the Second Sewerage Project. Project Results 6.0 Achievement of Project Objectives. The project has clearly improved sanitation in some 30 towns through the installation of sewerage and stormwater systems and the construction of treatment plants; this improvement is, nevertheless, deficient in view of the untreated industrial wastewater that is still being discharged into the environment. Industrial establishments are only permitted to connect to the sewerage system if their waste water is unharmful to the biological treatment process in ONAS's treatment plants, which may require a pretreatment of their effluents. Moreover, whereas tremendous effort has been put into constructing treatment plants and eliminating pollution caused by domestic sewage, open dumps of household wastes are found near some of these plants. 6. 1 The project has successfully eliminated the irrigation of garden crops with raw sewage and has contributed to the reuse of treated sewage by both industry and agriculture; in a modest first step, about 13% of the treated sewage is now being used in this way. 6.2 In the institutional sphere, ONAS has made an effort to improve its financial capacity since the introduction of significant tariff increases (12% p.a. on average during the 1983-1992 period). These increases are to be continued at a rate of 15% p.a. through the end of the Eighth Plan. However, they have been insufficient to ensure that ONAS can maintain the minimum covenanted self-financing and debt service coverage ratios of 13% and 1.3, respectively. 6.3 The project has made it possible to improve the mechanization of the operating departments through procurement of maintenance and flushing equipment. The project has also served to provide ONAS with data-processing equipment and software for its central and regional offices and for the maintenance and stock management departments, which will clearly improve the functioning of these departments. 6.4 The project funded a feasibility study for ONAS that will help it to plan its future investments better. 6.5 Project Cost. Initially estimated at TD 49.44 million, the project cost is now put at TD 70 million; as of loan closing (December 31, 1992) expenditure stood at TD 58.48 million. The breakdown of this expenditure over the main project components is as follows:  - 8 - (TD millions) Components Estimate Actual as Still to be Total of Dec. 31, effected 1992 Sewage and stormwater 29.79 31.56 0.78 32.34 secondary systems l Treatment plants 8.41 13.37 4.23 17.60 Operating and data 4.15 5.48 4.73 10.21 processing eqt. l Office accommodation 3.66 5.26 1.32 6.58 Consultants, studies and 3.43 2.80 0.47 3.27 other Total 49.44 58.48 11.52 70.00 Project cost overruns were 41.6% over appraisal estimates. The cost of the treatment plants and office accommodations were practically twice their original estimates, whereas operating and data-processing equipment cost almost 2.5 times. The items that remained closest to the estimates were studies (below estimates) and the systems (10%). These increases were due to a number of factors, including: (a) the longer execution time; (b) the sharp devaluation of the dinar from TD 0.630 per US$1 at appraisal to TD I at the end of the project; (c) the modifications introduced in the project, specifically those relating to the strengthening or design improvement of certain components; and (d) the 21% increase in total treatment plant capacity. The cost estimating of the treatment plants at appraisal was poor. The cost of the studies was slightly lower than estimated because ONAS made next to no use of consultants for supervision of the works. 6.6 Project Financing. The project was financed by the Bank loan of US$34 million, direct State subsidies, a USAID-guaranteed loan of US$24 million, and internally generated funds, i.e., the beneficiaries and ONAS. The USAID-guaranteed loan was contracted by the State and transferred to ONAS in the form of a subsidy. 6.7 Disbursement. An amount of US$33,074,739.28 was withdrawn from the US$34 million Bank loan, representing 97.3% of the proceeds; only US$925,260.72 had to be canceled. Disbursement was impacted by the slippage in project implementation because at the initial closing date, only 46% of the loan had been drawn down.  - 9 - 6.8 Physical Completion. All the project components either have been completed or are underway and nearing completion; some have been modified or strengthened. Of the 435 km of line system and 24,332 connection boxes initially planned, 370 km of system and 22,122 boxes have been installed. All the planned treatment plants have been built and a new plant has even been added at Sahline-Monastir. The good quality of execution was noted by the Bank mission of October 1993. 6.9 Financial Performance. ONAS has not attained the financial performance required and specified in the loan and project agreements and the supplemental letter. The self-financing rate is even negative at times, i.e., the domestic funds generated do not even cover the servicing of the debt and the variations in working capital requirements. In recent years, the debt coverage ratio has been less positive than envisaged and debt service requirements have outstripped domestic receipts. This has led ONAS to conclude a debt consolidation agreement with the Tunisian treasury. Similarly, the compensatory payments that the State makes to ONAS to assist with its operating costs and which, according to the supplemental letter attached to the Loan Agreement, were to be phased out during the Sixth Plan, have been maintained and were even increased in 1992 from 40 millimes to 45 millimes per m3 of water. On a number of occasions, the Bank has requested a letter of intent from the Government specifying a program for eliminating these compensatory funds and a study for sewerage cost recovery. ONAS and the Bank have prepared terms of reference for the cost recovery study and a limited list of consulting firms has been drawn up in mutual agreement. A call for bids has even been issued, but it has not been possible for this study to be made prior to the loan closing date. The tariff increases have been insufficient to improve ONAS's financial performance. Increases were put into effect in November 1984 (_%), December 1986 (14%), in July 1988 (20%), in October 1989 (15%), in October 1990 (15%) and in October 1991 (15%), and as of December 1992, annual increases of 15% are envisaged for the Eighth Plan. Together these increases have raised the average tariff from 71 millimes per m3 water in 1983 to 187 millimes per m3 water in 1992, hence an average increase of 12%. 6.10 Certain actions are still to be carried out, such as introduction of cost accounting, revaluation of fixed assets, assumption of responsibility for the project towns so as to be able to bill the beneficiaries, and billing for water drawn from wells used by industry and tourism. This well water is disposed of in the drainage systems and often flows into the treatment plants. 6.11 The common fund that ONAS receives from the communes is a proportion (8%) of this fund's budget; however, ONAS's costs increase with the number of towns taken over without this being factored into this source of revenue. 6.12 Environmental Impact. The project has had a positive impact on the environment making it possible to connect about 120,000 persons spread over 30 towns to the sewer system, provide 13 towns with treatment plants, and connect two others to existing treatment plants (Sfax suburbs and Beni Khalled).  - 10 - Institutional Strengthening 7.0 Organization. During project implementation, the law establishing ONAS was amended to give it an environmental protection role, thus going beyond its initial mandate as manager of the sewer system. This law also relieved ONAS of its responsibility concerning stormwater drainage works except on a management contract basis with a community. ONAS has further modified its organization and increased its decentralization by establishing regional departments possessing greater autonomy. 7.1 Staff Training. ONAS has continued its staff training programs, with assistance from GTZ in particular. ONAS engineers' contacts with the consulting firms and contractors have enabled them to enhance their expertise, especially in the area of sewage treatment. 7.2 Take-Over Program. At the time of appraisal (1982), 37 agglomerations had been taken over by ONAS (including six tourism zones), while as of loan closing the figure was 80 agglomerations, the target set in the appraisal. However, the towns actually taken over do not match the initial list. Compared with the project list, nine towns have not yet been taken over, viz. Soliman, Sayada-Lamta-Bouhjar, Menzel Bouzelfa, Beni Khalled, Menzel Temime, Bekalta, Teboulba, Ksour Essaf, and Mahres. It would be desirable for ONAS to take these towns over to prevent deterioration of the investments for lack of maintenance. Bank Performance 8.0 The Bank played an important role in the definition and preparation of the project, as five missions (including the appraisal mission) were devoted to this preparation with visits being organized to practically all the locations. The Bank has since followed up with one or two supervision missions per year. 8. 1 The Bank helped ONAS in redefining the content of the feasibility studies and master plans and with the preparation of the relevant terms of reference. 8.2 The Bank demonstrated flexibility in the adaptation of certain project components. 8.3 The Bank displayed considerable firmness in insisting that ONAS adjust its tariffs, with the result that ONAS has raised its tariffs by an annual average of 12% and is committed to increasing them by 15% during the period covered by the Eighth Plan. 8.4 However, the Bank has not succeeded in having a sewerage cost recovery study made. This study is now being carried out with German financing.  - 11 - 8.5 The Bank's response regarding the various sets of bidding documents submitted to it for comment by ONAS was generally quick (about two to three weeks); in certain cases, however, they took three months or longer (including mail delays). Borrower's Performance 9.0 Despite the implementation problems posed by a project spread over 30 towns and numerous neighborhoods, in urban locations often of a very restrictive nature and at times with delicate land-ownership problems, ONAS's performance in carrying out the project was of high quality. Supervision was performed in the majority of cases by qualified ONAS personnel. 9.1 However, ONAS should have increased its supervisory and especially its engineer-level staff so as to make their numbers more consistent with the total workload, especially for studies and project monitoring. This would have reduced the delays that occurred in executing the project. Project Relationship 10.0 Bank-ONAS relations were always good, with effective cooperation and mutual understanding between the two parties. 10.1 ONAS also maintains good cooperation with the other Tunisian institutions involved in the project, including the Ministry of Planning and Regional Development, the recently created Ministry of International Cooperation and Foreign Investment, the municipalities concerned, and the various system concession-holders, such as, among others, the Societe Tunisienne d'Electricit6 et de Gaz (STEG), SONEDE, and the telephone services (PTr). Consultants' Services 11.0 The consultants retained by ONAS to carry out the various studies performed satisfactorily as a whole; the quality of their work is considered satisfactory and has not given rise to any major problems at the execution level. Project Documentation and Data 12.0 The documentation found in the Bank made it possible to reconstitute the project's history, but computerized processing of the Forms 590, currently unavailable, would have been helpful. The completion report provided by ONAS contains a considerable amount of invaluable data. ONAS regularly submitted audit and quarterly project progress reports, though often a little behind schedule.  - 12 - Recommendations 13. The main recommendations that can be made in light of the experience gained with this project can be summarized as follows: 13.1 To provide ONAS with a modicum of financial independence, the Bank imposed a number of requirements with which compliance proved difficult. In point of fact, while committing ONAS to a major investment program, the Loan Agreement required that ONAS no longer receive compensatory revenues from the State and that it attain a self-financing rate of 13%. At the time of appraisal, this problem should have been approached differently by simply eliminating the compensatory revenues and instituting tariff increases. The cost-recovery study should have been completed before the project appraisal rather than during project execution. This study would have generated more appropriate solutions which could have been adopted in the context of the Loan Agreement. Even though ONAS is an industrial and commercial enterprise, it is also the State's operator for social projects. These two missions must be kept separate and be carried out under different financing arrangements. Instead of seeking to eliminate the compensatory revenues, it would perhaps have been better to earmark this subsidy for specific projects. Privatization of some of ONAS's operating activities could also reduce the cost of sewerage. A cost accounting system will help to better define the tariff policy. A wastewater treatment tariff could also be proposed. 13.2 In the case of new projects of a similar type, it is recommended that ONAS and the Bank establish clear specifications at the start for each type of service (e.g., line-laying, pipe supply, equipment supply, treatment plant), so that it will not be necessary systematically to forward sets of identical bidding documents to the Bank and all that would be required would be submission of particular components or any justified changes for review. 13.3 A turnkey procedure for treatment plants would be worth trying out for ONAS, since it could save time. 13.4 To lighten the load on ONAS, it is recommended that consulting firms and individual consultants be used for supervising works; this is also the best way to help local consulting firms improve the quality of future studies they are retained to make for ONAS. 13.5 Introduction of flexibility into procurement procedures could accelerate project execution and lower costs. 13.6 The number of staff assigned to project implementation needs to be aligned with the total workload to ensure that projects are completed on schedule. 13.7 ONAS's performance is, indeed, improving all the time. However, its lack of liquidity and cumbersome procurement procedures cause unacceptable delays in replacing  - 13 - control instruments and spare parts. It is recommended that ONAS make a determined effort to remedy this lack of maintenance.  - 14 - Project Identity Project Name : Third Urban Sewerage Project Loan No. . 2255-TN Borrower . Government of Tunisia Executing agency: Office National d'Assainissement (ONAS) Estimated Cost: US$78,480,000 = TD 49,440,000 Final Cost: = TD 70,000,000 Loan Amount: US$34 million Loan Conditions: - Disbursement period 17 years - Grace period 4 years (included in disbursement period) - Interest rate on principal variable (0.5% above cost of reference loans) - Commitment fee 0.75% p.a. (on undisbursed balance) - Front-end fee US$253,102 Other documents accompanying the loan: - Subsidiary agreement between ONAS and the Tunisian Government - Project Agreement between the Bank and ONAS - Supplemental letter Bank Board approval March 29, 1983 ONAS Board approval March 1, 1983 Loan Agreement June 16, 1983 Effectiveness August 30, 1984 Initial closing date December 31, 1989 Actual closing date December 31, 1992 Division: EMENA CPII Sector: Water Supply and Sewerage Subsector Sewerage  - 15 - Evaluation of Numbers of Bidders Component No. of No. of Average contracts contracts No. of bids concluded in concluded received context of following per call project international competitive bidding Studies 12 10 6.2 Line-laying and civil 18 14 9.0 engineering Supply of pipe and 11 11 7.5 iron parts Construction 4 4 3.3 equipment _ Dataprocessing 8 7 7.1 equipment Operating equipment 19 18 8.7 Treatment plant 14 5.7 equipment and 16 pumping stations TOTAL 88 78 = 88.6% Average of 6.8  - 16 - TUNISIA THIRD SEWERAGE REPORT (Loan No. 2255-TUN) PART II. PROJECT REVIEW FROM THE PERSPECTIVE OF ONAS  - 17 - THIRD URBAN SEWERAGE PROJECT (Loan 2255-TUN) I. INTRODUCTION 1.01 The Tunisian Government's different objectives concerning sewerage during the last five economic and social development plans have focused on: - improvement of services provided by this sector; - rehabilitation, modernization, and expansion of the existing sewer systems; - construction of the treatment and disposal facilities necessary to protect the environment and reduce the health risks for the population; - improvement of (increase in ?) connections to the public sewer system; and - promotion of the reuse of treated waste water for agricultural and industrial purposes to supplement the country's limited water resources. 1.02 The Office National de l'Assainissement, established in August 1974, is the agency responsible for sector development. Its mandate is to protect the country's water environment, as well as to manage, operate, maintain, renew, and construct all works intended for urban sewerage, particularly treatment plants. 1.03 To assist the Tunisian Government to achieve its objectives, IBRD has granted loans to this sector for the following projects: Tourism Infrastructure Project (Loan 858-TUN and Credit 329-TUN, signed on February 28, 1992, US$ --- million), which has supported the implementation of sewerage works in six tourism areas; The First Urban Sewerage Project (Loan 1088-TUN, signed on February 18, 1975, US$28 million), which funded the organization of the structures for setting up ONAS, the upgrading of sewerage installations in the Greater Tunis region, and the protection of Lake Tunis against the pollution resulting from overflowing stormwater; The Second Urban Sewerage Project (Loan 1675-TUN, signed on April 13, 1979, US$26.5 million) which supported the development of sewerage and drainage systems for Greater Tunis and Sfax and also provided assistance to ONAS for strengthening its project planning and supervision capability; and  - 18 - The Third Urban Sewerage Project (Loan 2255-TUN) which is the subject of this completion report. The relevant appraisal report was produced by IBRD in March 1983. The amount of the resultant loan was US$34 million. It should be noted that for the loans granted to help finance the First, Second, and Third Urban Sewerage projects, the Tunisian Government was the borrower and ONAS the principal executing agency. II. IDENTIFICATION. PREPARATION AND APPRAISAL OF THE THIRD URBAN SEWERAGE PROJECT 2.01 Having undertaken projects designed to upgrade the sewer systems of Greater Tunis and Sfax, ONAS turned to sewerage for small and medium-size towns. To this end, in 1977, ONAS hired a expatriate consulting engineer to make a general study of the sewerage sector in Tunisia in order to draw up a national action program according to set priority criteria. This study, which was fully discussed with IBRD, resulted in a first expansion program covering the sewerage systems in 17 priority towns, for which financing was provided by the EEC. The second program adopted covered the 11 towns in the Medjerdah watershed, with financing by KfW. The third program, known as "Third Urban Sewerage Project," covers 30 interior towns. Financing has been provided by IBRD through Loan 2255-TUN, which is the subject of this completion report. 2.02 The expatriate engineer made a feasibility study for the Third Urban Sewerage Project in 1982 and the Bank carried out an appraisal in March 1983. The feasibility study was financed in the context of the Second Urban Sewerage Project, which was partly funded by IBRD Loan 1675-TUN. At the time of appraisal, only the preliminary studies were available. OBIECTIVES OF THE THIRD URBAN SEWERAGE PROJECT 2.03 The main objectives of the project are the following: Upgrade urban sewerage in 30 interior towns through the rehabilitation of the existing systems; Develop sewerage systems where individual facilities create serious health risks, and encourage the population to hook up to the new systems; Provide for stormwater drainage; Treat sewage with a view to reuse in agriculture and industry as part of a national water resource management policy, and put an end to the practice of irrigating vegetable crops with untreated sewage;  - 19 - Support the Government's efforts aimed at providing, over the medium and long term, the means to make the sector financially independent; and help ONAS to: (a) strengthen its financial position by encouraging adoption of a new long-term financial policy that will enable it to fund at least 13% of its investments during the project execution period (1983-89); (b) progressively take over responsibility for sewerage, sewage treatment, and disposal in all urban centers with over 10,000 inhabitants; and (c) improve its operating capacity by procuring maintenance and data- processing equipment and building the necessary aerials facilities. DESCRIPTION OF THE PROJECT 2.04 The project includes: - Construction of about 110 km of primary sewers plus some 20 pumping stations and other associated works; - Construction of about 300 km of secondary sewers; - Construction of about 25 km of stormwater sewers; - Construction of about 12 sewage treatment plants, expansion of one existing plant and connection of five towns to existing plants; - Supply of maintenance and dataprocessing equipment, together with construction of the necessary office facilities; - Provision of the services of consultants tasked with preparing the necessary plans and supervising the construction work and the execution of the following studies: (a) feasibility studies for 10 to 15 new plants which would be placed under ONAS control, and with a view to encouraging reuse of treated sewage for industrial and agricultural purposes; and (b) a study on computerized dataprocessing and the information system. 3  - 20 - COST OF THE PROTECT 2.05 The appraisal report estimated the cost of the project at TD 49.44 million (US$78.48 million), of which TD 21.42 million would be in foreign exchange (US$34 million), i.e., 43% of the total cost. FORECAST PROJECT COMPLETION DATE 2.06 The appraisal report set December 31, 1989 as the project completion date. LOAN NEGOTIATION AND APPROVAL 2.07 IBRD granted a loan of US$34 million to finance the project's foreign exchange component. The negotiations were conducted in Washington in February 1983 and the loan agreement was approved by the Bank on March 29, 1983 and signed on June 16, 1983. The loan conditions are as follows: - Amount US$34 million - Interest rate 11.43% - Front-end fee US$253,000 - Amortization period 17 years - Grace period 4 years During the negotiations, the Tunisian delegation requested a grace period of six years instead of four. This was unacceptable to the Bank because the four-year period adopted is based an average that was set for Tunisia. The Tunisian delegation rejected the clause pertaining to the operating subsidy included in the Loan Agreement obliging the Tunisian State to eliminate, prior to December 31, 1986, the subsidies paid to ONAS to help finance its operations. It was agreed that the question of subsidies would not be mentioned in the Loan Agreement followed by a supplemental letter. III. EXECUTION OF THE PROTECT Loan effectiveness 3.01 The Loan Agreement became effective on August 30, 1984 following the signing of the subsidiary Loan Agreement between the Tunisian Government and ONAS, which took place on July 21, 1984.  - 21 - Project startup 3.02 The execution project-assisted studies was started in November 1982, i.e., before the date of loan effectiveness. The first tenders for line-laying were issued in April 1985 and those for the treatment plants in October 1988. Amendment of project contents 3.03 The project was appraised on the basis of the feasibility study made in 1982. During the preparation of the engineering drawings and as execution proceeded, certain adjustments were made after consulting the Bank. These changes related essentially to the wastewater treatment and feasibility study components. The Project Agreement called for connecting the town of Sahline to the existing treatment plant at Dkhila, but in view of the conclusions of the revised master plan for the Dkhila tourism area it was agreed with the Bank that a treatment plant would be built in the town of Sahline. It was agreed with the Bank that the studies to be made would enable determination of a future investment program for the period 1992-2011. The studies in question are: - updating of the Greater Tunis sewerage master plan; - updating of the Greater Bizerte, Greater Sfax, Greater Gabes and Greater Sousse master plans; and - the feasibility study for sewerage systems in the other Tunisian towns with over 2,000 inhabitants. These studies have led to an investment program for Greater Tunis, Sfax, Sousse and Kairouan that will benefit from a new loan from IBRD. This program is known as the Fourth Urban Sewerage Project. Execution schedule 3.04 The schedules for each project component were as follows:  - 22 - Appraisal Forecasts Actual Start Completion Start Completion Pipe procurement end 1983 end 1988 end 1985 end 1990 Sewer systems beg. 1984 end 1988 end 1985 end 1992 Treatment plants mid-1985 mid-1988 mid-1990 end 1993 Offices end 1983 mid-1988 end 1984 end 1986 Procurement of mid-1983 end 1986 end 1983 mid-1993 operating eqt. Feasibility study mid-1983 end 1985 beg. 1991 mid-1993 Data processing beg. 1984 end 1985 end 1989 mid-1992 study Project completion was initially set at December 31, 1989; on that date progress stood at about 60% and disbursements at 46%. To enable ONAS to continue execution of the project, the Bank agreed to defer loan closing until December 31, 1992. 3.05 The delays in completing the works were due to the late startup of certain components and to delays in the course of the works. (a) Delays due to late startup These delays were caused by delays in the engineering studies relating to the line-laying works, which varied from 5 to 15 months and were themselves caused by geotechnical and topographic work that took appreciably longer than anticipated. In the same way, the preparation of the model specifications by ONAS in collaboration with the consultants required a considerable amount of time and resulted in slippage of submission of the bidding documents compared with the dates initially set. As a consequence, the different calls for bids on the civil engineering from the system and procurement of supplies were issued between February 1985 and February 1987 instead of between October 1983 and May 1985. The works were completed at the beginning of 1993 instead of early in 1989, i.e. three years later than forecast.  - 23 - The slippage was roughly the same for the wastewater treatment component, which involved 13 towns and was entrusted to one single consultant. Completion of the studies was set for October 1985, but in the event this date had to be extended to October 31, 1988, on account of certain changes made in the course of execution, namely: - the change in purposes resulting from urban and demographic growth different from the forecasts on the basis of which the project was designed; the change in the location and size of certain units due to land availability, especially in the towns of Menzel Bouzelfa, Grombalia, Mahres, and Zarzis; and the preparation of a study for a new treatment plant in the town of Sahline instead of a study for expansion of the existing plant at Dkhila. Moreover, the study for the ONAS computerization master plan was not started until October 1989, instead of in 1984, as originally scheduled. It should be noted that ONAS signed the agreement for this study with a foreign firm back in 1984, but the Central Bank did not give its approval until 1989 after an agreement had been concluded between Tunisia's Centre National d'Informatique (CNI) and that firm on arrangements for technical assistance for setting up a computerized data processing system in ONAS. (b) Delays during project execution The delays posted during project execution were mainly caused by: difficulties encountered during line-laying (e.g. traffic, presence of various other networks that had to be rerouted, coordination with other urban projects); difficulties in obtaining permits to import necessary specialized equipment (e.g. for lowering the water table); and land ownership problems that held up progress, particularly identifying owners, inadequacy of documents certifying ownership, and agreement on compensation. Performance of consultants and contractors 3.06 The studies for the systems for the 30 towns were entrusted to Tunisian consulting firms, while those for the 13 treatment plants were awarded to a single foreign consulting engineer.  - 24 - 3.07 ONAS, for its part, made available the experience it had gained in the field of sewerage and the lessons it had learned from the functioning of the facilities in operation. 3.08 The instructions and technical criteria recommended by the consultants were followed and their implementation has not, taken overall, revealed any weaknesses at the design level. 3.09 Local contractors participated in all line-laying work. Certain works for the treatment plants were entrusted to foreign contractors. 3.10 The systems and plants as constructed are considered, overall, in accordance with the designs and quality standards adopted. Bank performance 3.11 The Bank regularly sent out supervision missions to review all ongoing Bank- financed projects. 3.12 At the end of each mission, the Bank produced an aide-memoire summarizing the discussions held and the commitments assumed by the different contracting parties to the loan (i.e., Government, ONAS, IBRD). 3.13 The Bank supported the different proposals submitted to the Government by ONAS for tariff increases to improve its financial position and to achieve a self-financing rate of 13% and a debt service coverage ratio of 1.3%, as stipulated in the Loan Agreement. 3.14 The Bank demonstrated flexibility in adapting the project to the realities of the changing situation encountered during implementation, with a view to following the development of urbanization better. 3.15 Following the devaluation of the Tunisian dinar and the shifts in exchange rates, and with a view to ensuring full utilization of the loan, the Bank agreed to include funding in the project for studies, supplies, and works matching the objectives and description of the project. 3.16 The Bank made experts available to ONAS to provide the technical advice needed for the preparation of a financial dossier justifying the allocation of operating, maintenance, and capital expenditures to the following categories: sewer systems, stormwater systems, and treatment plants.  - 25 - Difficulties encountered 3.17 The laying of secondary systems in the narrow streets of certain towns was a hindrance to the residents in view of, among others, the traffic problems, the fill works, and cracking. Pavement rehabilitation 3.18 The pavement rehabilitation works also caused numerous problems, since this rehabilitation could only be carried out for pavement affected by the works. Moreover, because the streets and roads concerned were old, this partial rehabilitation did not hold up long. It is desirable that the entire width of the street or road be rehabilitated, charging the additional cost to the municipality receiving a new pavement and the contractor who is responsible for part of the deterioration resulting from heavy equipment movements or cave-ins and cracking resulting from insufficient shoring up. Recovery of shares payable in the cost of the systems 3.19 Recovery of the costs involved in the secondary systems caused some problems. The fact is that in the towns where sewer service is taken over by ONAS, billing is subject to a prior commitment on the part of the beneficiaries. The new law establishing ONAS promulgated in April 1993 will enable ONAS to bill ex-officio. In the towns not taken over by ONAS, no recovery was effected. Procurement 3.20 All procurement relating to studies, works, supplies and equipment required for the project was effected in accordance with the procedures laid down in the project agreement. 3.21 The time allowed for bid evaluation and contract award for supplies, civil works and procurement of operating equipment was 6 months, and for treatment plants it was 12 months. The actual time taken for the project varied between 9 and 15 months for the systems and between 18 and 20 months for the treatment plants, owing to the size of the project and the centralized processing of procurement.  - 26 - Disbursements 3.22 Disbursements from the loan took much longer than was forecast durirg appraisal, owing to the delays in execution already explained. Whereas the original schedule called for the loan to be entirely disbursed in 1989, actual disbursements as of that date only stood at 46% of the total. To be able to complete execution of all the project componn , the Bank had to extend the closing date three times. The first extension was from December 31, 1989 to December 31, 1990, the second was to December 31, 1991, and the third was to December 31, 1992. The last disbursement was made on June 29, 1993. The total disbursed was US$33,074,739.28, i.e., 97.3%. Project cost 3.23 The cost of the different project components as described in the loan agreement and for which the contracts were approved by the Bank was TD 70 million, whereas the appraisal estimate was TD 49.4 million, hence a TD 20.5 million overrun. This overrun was covered by government contributions in the context of financial operations. About TD 5 million of the TD 20.5 million overrun is explained by price increases due to 40% of the project is being completed after the date originally set. In the same way, some TD 6 million is accounted for by the devaluation of the dinar with respect to the main currencies in which the foreign exchange components of the contracts were denominated. The rest of the overrun is explained by increases in works quantities. 3.24 The comparison of the forecast and actual costs cannot be done using the same breakdown as in the appraisal report, but can be presented as follows:  - 27 - FORECAST ACTUAL AS AFTER TOTAL OF 12/31/92 12/31/92 - Secondary end primary sewerage 29.79 31.56 0.78 32.34 and stormwater sewer system - Treatment plants 8.41 13.37 4.23 17.60 - Operating and dataprocessing 4.15 5.48 4.73 10.21 equipment - Offices 3.66 5.26 1.32 6.58 - Consultants, studies and other 3.43 2.80 0.47 3.27 49.44 58.48 11.52 70.00 3.25 At the date of loan closing, payments made stood at 84% of the total cost of the project, with the remaining payments to be made in the course of 1993 as the works progressed. 3.26 The differences between the forecast and actual figures are explained by the considerable slippage with respect to the original investment schedule. The impact of this slippage amounted to about 7% of the cost of the project. In point of fact, 40% of the project actions were implemented after the forecast completion date of December 31, 1989. Other factors were the devaluation of the dinar with respect to the main currencies in which the foreign exchange components of the contracts were expressed, which had a roughly 9% impact on the project cost; the lack of precision regarding the system trench lines in the feasibility study, and therefore in the estimates based on this study; and the change in the size of the project which caused in increase in works quantities. 3.27 The main cost variations were in the following components: (a) Treatment plants Estimated at TD 8.41 million at appraisal, actual cost TD 17.66 million, i.e. about twice estimate. This difference was due to the estimates being based on rough ratios. (b) Operating and data-processing equipment This item was estimated at TD 4.15 million at appraisal, but the actual cost is expected to be TD 10.21 million, i.e. over twice the estimate. This is  - 28 - accounted for by ONAS's need for larger quantities of equipment to handle the demands in the additional towns taken over. (c) Office accommodations The appraisal estimate for certain ONAS office premises did not take into account the construction and equipping of the facilities in the Sfax, Sousse, and Nabeul regional departments. 3.28 Financial results The attached annexes show ONAS's operating accounts at appraisal and the actuals, the profit and loss accounts, cash flow statements, balance sheets and financial strategies for the period 1983-93. The appraisal figures covered the period up to 1990, and actuals are used for 1991 and 1992. IV. ROLE AND DEVELOPMENT OF ONAS 4.01 Organization and management ONAS's new organizational chart drawn up in 1989 emphasized decentraliz- ation, primarily because of its continuing expansion into the different regions of the country. As a result, five regional departments have been established: the Tunis, Northeast, Northwest, Center, and South departments. Moreover, in 1992 ONAS commissioned a study for the purpose of preparing the organization master plan and manuals of procedures. This study defined the tasks of the different units and drew air a new organization chart. The two ONAS organization charts referred to above are shown in the annexes to this report. 4.02 Personnel and training In 1992, ONAS's personnel numbered 3,200, i.e., 6.5 per 1,000 connections. As of 1990, the appraisal showed a figure of 7.6 per 1,000 connections. This improvement in the ratio results from the increased mechanization of operations by means of equipment procured under this project. As regards training, ONAS has carried out a complete program with German (GTZ) assistance.  - 29 - Billing and collection of sums due 4.03 Billing and collection are still being handled by SONEDE. 4.04 Accounting Accounting, supervision of structures, and payroll are currently computerized and transactions are posted satisfactorily. 4.05 Data-processing To keep track of project costs, ONAS has set up a computerized information system which provides data by region, office, and project. Other programs are being implemented. V. PROJECT JUSTIFICATION 5.01 Improvement of connection rates The installation of the primary and secondary systems in the 30 towns has made it possible to improve living, hygiene, and health conditions in the areas concerned. In the period 1983-92: The number of connections in the 30 project towns totaled about 22,600; The number of ONAS/SONEDE subscribers in the 30 project towns increased from 4,000 in 1983 to 10,000 in 1992; and The connection rate in the 30 project towns increased from 35% in 1983 to 60% in 1992. 5.02 Impact of the 13 treatment plants The entry into service of the treatment plants in the 13 towns concerned has had a considerable impact on protection of the environment. These plants have produced 10 million m3 of treated water available for irrigation purposes per year. 5.03 Defmition of future investment program The reviews of the master plans for Greater Tunis, Bizerte, Sousse, Sfax and Gabes together with the feasibility study for 2001 made in the context of this project have enabled preparation of three future investment programs.  - 30 - The first is the Fourth Urban Sewerage Project (Greater Tunis, Sfax, Sousse and Kairouan), which is the subject of a Bank pre-appraisal study. The second is the sewerage project for 24 priority towns for which financing is presently being sought. The third is the sewerage project for the Bizerte region that will be fin;n.eL, by KfW. (a) Upgrading of mechanical maintenance capacities for sewerage fac.lities 5.04 The project has enabled procurement of a considerable quantity of operating and mechanical maintenance equipment for the sewer systems. While mechanization stood at 20% in 1983, it is now 32%. (b) Improvement of frmancial results 5.05 ONAS has been able to improve its financial results thanks to adoption of medium- and long-term financial policies and objectives aimed at generating sufficient funds to finance a part of its investments. This policy has involved implementation of tariff adjustments by ONAS. 5.06 Technology transfer to ONAS's benefit ONAS retained a foreign consulting engineer to carry out the design studies for the 12 treatment plants and to supervise the works involved. The formation of integrated consultant/ONAS teams has produced beneficial technology transfer results. The experience of ONAS staff has been greatly enriched through the execution of this project. VI. CONCLUSIONS AND LESSONS LEARNED 6.01 Conclusions The different project objectives were accomplished. The works have improved the sanitation status of the project towns and have had a definite impact on protection of the environment and improvement of the residents' living conditions. ONAS, for its part, has improved its technical and financial capacity.  - 31 - 6.02 Lessons learned The realistic execution period for a project of this magnitude cannot be less than eight or nine years. This period must be adopted in future appraisals of projects of similar magnitude. 6.03 To avoid having to make changes in the project parameters, appraisals must be based on feasibility studies and sewerage master plans, and also regional and local development plans.  - 32 - TUNISIA REPUBLIC THIRD SEWERAGE REPORT (Loan No. 2255-TUN) PART III: STATISTICAL INFORMATION  - 33 - Missions Stag. of DATE MonUh N Staff Days Speclalaona Nom Naje of pnoj scI ona Yar Mold Represnted Prooenm s-Jan-1 i-Jan-1 5 Santary onCiner TenalUo ptepanaUon 20-Oct-81 6-NOV-81 16 Sanntay nginewr Tiii 20-Oct-a1 S-Nov-at i a Rnancia analyst Pommimr prepanrion 10-Jan42 26-Jan-a2 16 Consultant (Socal) Jacob In Tunia 1 5-Jan-82 1 -Jan-2 Consultant tSocal Jacob in Washinalan prepartion 17-jan-2 2-Jan-82 11 Sanritwy ngr TonaLne 17-Jan42 28-Jan-82 II Rinancial analWt Pommer_ reparation 274-Jan2 5-Feb-82 8 Consultant (Soci10 Jacob In Wasindton 8-Ap42 22-Apr42 14 San"ty engier Tenil Preov.luaton 3-Apr-a2 22-Apr-a2 14 RnancIal anlyt Pommier 22-Apr42 24__a2_ 2 Sanaty ngineer Kalbcn 10-Oct-82 21-Oct-82 11 SanIta"y ngineer JV3 Evaluton 10O-ct-2 21 -Oct42 11 Financial nat Pommler Supvson 4-Sep43 23-Sep43 19 Sanitary enginer JVB 4-Sp_ 23S_ p 43 19 Financial anayt Pronotea Supevion 1 -Oct-3 1-Oct-83 Oct-83 13 SanIty engineer JVB Oct-83 13 Financial ana&st Pnouveau Suporvison 14-May-84 31-May-84 May-84 1 17 Santauy engineer JV8 ____Ipartement eu potable utt Smavala Alphonse Superislon 28-Nov-84 12-D c-84 Nov-84 2 14 Sanitary enginer JVB Fini (nimoval of oNed" tvmw 5-Dec-84 10-Dec-84 Dec-44 5 FRnancial st (consutant) RICHRO VERSPYCK Sup sion 16-Apr-8 20-Apr-85 Apr-5 3 4 Sanitaty engineer JVB 16-Apr-84 25-Apr-5 9 Sanitary engine Las Rasmnasson 18-Apr-S 25-Apr4-8 9 Fnancial analyst Prenouveau 1 -Apr-85 25-Apr-85 tpS 9 Fnanctal anat Oesaute4 Finan mol OS coneat rnu Superision 11 -May-8 23-May-8 May-8 12 Financial analyst Contrna Sewerge TarYif 11-May-8 23-May-8 12 Sanary engineer Mantew 11 -May-8 23-May48 12 Santary ngineer LAs Pasmason 11-May-88 23-Ma8 12 Economiste Dyst -MaY- 23-Mavy86 12 Financial anaNvst Prnouveau Supwvision SOp47" Divsion ciUet Ludwig 1 9-So7 2-Oct-87 Oct47 13 Sanitar engineer Vlidannan Finani (removal of compenSim wlnu Supervision 2-Dec47 15-Dec-47 Dc-87 13 Fnancter aayst Contrem Supervison 15-Jan-88 2-Fet-88 17 Financia anat Conte Supervion 15-Jan-88 2-Feb-8_ 17 Sanitary enginwer Veldeaman Superion 19-May-88 31-May-8 12 Financial nayst Contrr 19-May-8 31 -My 12 SanItary enginee Velrdemian Supervtsion 15-an-89 2-Feb-8 Jan-8 17 FInancial analyst Contrera Feb-8 17 Santaty ngineer vdriarman 16lJan4-9 31- Jan5- 13 Consunant (Coat recn y) Postman 19-Jan-89 21 -Jan-89 I 2 Consutant tCost recny) Vigg r Supersion 14-Aug-89 30Aug9 1 [Financtat anayst Contt_ Suporison 13-Oct- 1 -Nov-8 1 ijsanitarv engineer Veiderannn 5-Feb-90 17-Feb-90 12 Santary engineer Hovnarion 5-Feb-90 17-Feb-90 12 FInancia anairnt Contt Supervsion 18-Sep-90 27-Sep-90 11 Sanitary engineer Veiderman 24-Sep-90 25-Sep-90 4 Finncwia ayst Contre 24-S5__90 2-Sep-90 4 A__S Superion 26-Jan-92 31t-Jn-9 Jan-92 5S an"arx enginr v'Oieun 3ewe Taern 28-Aug-92 19-SeP-92 Ag92 21 Sanliary engineer JVB losingdte. ao tawy Sep-93 7 DMsilon ciref __ ______ SpaU sion 24-Jan-53 11-F-0 I Financuri _ _a_yst_ _n_OuaN Total dayvaman 582 PREPARATION AND EVALUATION NomDber of misslon 8 Nomberof Days 131 StJPERYS0N Nombw of mission 18 Nomber day 451 Nombr of mission per year 1.8 Nomber of Days por year 45.1  - 34 - ,qtsahr of T.gpml rnv'nenft Tunha Third Urban Sewerage Project (Loan 2255-TUN) Overal Project Rating: 2 Original Revised Covenant Fulillmnent Fulf Iment Acreement Section type Status date date Descriptlon of Covenant Comments Loan No. 3.01 (a) F OK 08t03t84 Borrower shall cause ONAS Futlfed to perform in accordance with Project Agreement Loan No. 3.01 (b) F OK 08/03184 Borrower to reent proceeds Futlfed to ONAS under subsdiary loan agreement Loan No. 3.01 (c) F OK 08/0Y384 Borrower not to modfty Fulillted subsldiary oan agreement Loan No. 3.01 (d) F OK 08/03/84 Borrower to make funds Fufimed available to complete project Loan No. 4.01 (a) F OK 08/03/84 No Uen to be created on FulSed public assets Loan No. 4.02 F Soon OW3/84 Borrower to adow ONAS to Full cost recovery taieptd for 1998 set taritfs to comply with Proj. through gradual tariff ineases Agreement section 4.04 Project No. 2.01 M OK 08/03/84 ONAS to carry out poject with due diligency Project No. 2.02 M OK 08/03/84 ONAS to employ consultng engineers ProJect No. 2.03 M OK 08/03/84 Procurement to be carried out in accordance with Bank guidelines ProJect No. 2.04 (a) M OK 08/03/84 ONAS to take insurance Project No. 2.04 (b) M OK 0803184 Procured goods and saivices only to be used for project Project No. 2.05(a) M OK 08/03/84 ONAS to fumish plans, reports contract documents etc. Project No. 2.05 (b) M OK 08t03184 ONAS to keep records Project No. Z05 (c) M OK 08/03184 Bank allowed to publish contract awards Project No. 2.05 (d) M OK 12/31/92 ONAS to prpare Project Completion Report Project No. 2.05 (e) M OK 08103tB4 ONAS to enable Bank staff to visit all Installations Project No. 2.06 M OK 08/03/84 ONAS to honor subsidiary loan agreement Project No. 2.07(a) M OK 08/03/84 ONAS to exchange views with Bank Project No. 2.07 (b) M OK 08/03/84 ONAS to Inform Bank on Interfering conditions Project No. 2.08 M OK 08/03/84 ONAS to acquireland Project No. 2.09(a) M OK 08/03/84 ONAS to monitor indicators Project No. 2.09 (b) M OK 08103/84 ONAS to take remedial action Project No. 3.01 M OK 08B03/84 ONAS to carry out its operations in accordance with sound practies ProJect No. 3.02 T OK 08103/84 ONAS to operate ts plant In in accordance with sound practices Project No. 3.03 M OK 08/03/84 ONAS to take adequate insurance Project No. 3.04 M OK 08/03t84 ONAS to acquire franchises etc. Project No. 3.05 M OK 08103/84 ONAS to obtain Uie to goods Project No. 3.06 M OK 08/03/84 ONAS not to dispose of its properties Proect No. 4.01 (a) F OK 08t03/84 ONAS to maintain financial records Proiect No. 4.01 (b) F OK 08/03/84 ONAS to retain records tI one year after closing date Project No. 4.02 (a) F OK 08/03/84 ONAS to have Its uinancial statements audited foe each ftiscal year Project No. 4.02 (b) F OK 08/03/84 ONAS to fumish the Bank with Generally fulfld wih some delays. audit reports Project No. 4.02(c) F OK 08/03t84 ONAS to fumish the Bank with informadon as requested Project No. 4.03 (a) F soon 08/3t84 Debt coverage to be '1.3 Project No. 4.04(a) F oon 08/03/84 Self financing>13% Proct No. 4.04 (b) F OK 0803/84 Before November30 each year to review level of revenues  - 35 - Evaluation of Numbers of Bidders Component No. of contracts No. of contracts Average No. of concluded in context concluded following bids received of project international per call competitive bidding Studies 12 10 6.2 Line-laying and civil 18 14 9.0 engineering Supply of pipe and iron 11 11 7.5 parts _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ Construction equipment 4 4 3.3 Dataprocessing equipment 8 7 7.1 Operating equipment 19 18 8.7 Treatment plant 16 14 5.7 equipment and pumping stations TOTAL 88 78 88.6% Average of 6.8  ONAS- THIRD URBAN SEWERAGE PROJECT MONITORING INDICATORS Fiscal ye Er*WV Decmber 31 1002 1964 196 196 1967 1910 1960 1990 1963 1964 1965 1966 1967 1988 1989 1090 1991 1992 INDICATO rS I.GENERAL.___ TodA popPIon 10-3 6710 683o 6960 7120 7260 7400 7550 7700 6800 6970 7140 7320 7500 7690 7801 6080 8260 8s50 TGaEl Utbl Popu n 10-3 3630 3750 3870 3990 4130 4270 4400 4550 3740 388o 4000 4130 42u 4390 4s53 46e0 4830 4980 ToEi Utbekn Popftlion In ONAS belwd 2250 2420 2640 2940 3210 3340 3440 3530 2040 2160 2220 2280 2620 2700 2960 3230 3600 3780 Todl PopAllhn h"led by OfAS 10-3 1330 1480 1670 1740 1910 20 206 2140 1360 1460 1580 1640 1830 195 2060 2330 2700 265o N orb _ of kwa)8 Mn ow 38 42 80 e5 77 80 80 80 30 34 35 35 48 49 58 60 70 80 2. STAFFNG =_= Total staff 1710 1840 1975 2160 2360 2525 2630 2735 1811 1889 1945 1952 2167 2355 2555 2707 2893 3199 SlaN per 1000 connedion 6.8 8.5 8.3 8.1 7.9 7.8 7.7 7.6 88 7.9 7.2 8.5 6.8 6.8 6.6 6.5 6.3 6.4 3. Syaen'Opong __ = _ Se8mge90vukee I0O8/yeu 83.60 90.08 99.71 106.55 119.78 131.63 141.21 161.31 78.40 81.20 87.30 38.90 91.00 95.00 104.00 107.20 109.40 116.70 Nor d <Omwd*O 10 3 109 216 237 286 299 325 341 359 205 240 272 299 318 341 390 414 456 499 4. FINANCE____ ___ Woieg mew 67.21 vz12 59.16 5688 63.79 50.76 47.85 47.90 68.68 78.94 67.50 n7.60 73.9s 76.75 77.29 88.42 79.27 75.43 DOW Equly fll 3a.42 30.16 30.20 38.06 36.73 37.98 38.90 39.71 29.28 27.90 25.76 25.31 29.46 29.48 27.27 16.51 14.40 14.52 DM n4 ceacova&n 1.64 1.38 1.44 1.48 1.34 1.35 1.51 1.55 1.58 1.45 1.8 1.30 1.3 0e33 1.04 0.88 080 0.04 Av . Ie In TD pw m3 0.088 0.10S 0.120 0.141 0.160 0.180 0.205 0.215 0.071 L0.73 0.03 0.04 0106 0.108 0.123 0.140 0.160 0.187 OperUngeJtpemInkDT pw im(1) 0.004 0.101 0.108 0.115 0.121 0.127- 0.134 0.142 0.007 0.114 0.117 0.129 0.132 0.140 0.159 0200 0.216 0.220 Sel Unencmgv guM. %: I____ ____ klchJlg cuanw cdrmb a I 20.0 13.0 13.0 16.7 21.5 17.8 22.2 20.3 15.1 24.4 30.5 4.2 -29.7 *9.9 1.1 -13.4 6.6 (1) db d _ dp-_  ONAS- THIRD URBAN SEWERAGE PROJECT INCOME STATEMENTS (TD M on) AW~paIs. FoQMa.I - - -I- A- - cal yearEnWV Decumbw 31 1983 1904 1965 1986 1987 1968 190 1990 1983 1964 1985 I9ON 1961 1988 1989 1990 t99t 1992 S5p. NWbm (MNfl.M31 636 9 0.06 00.71 106.55 119.78 131.63 141.21 151.31 78.40 81.20 87.30 68.00 91.00 06.00 104.00 179.2 0 90 18.70 No o connedlon C0003) 194.56 21.56 23727 266.26 206.60 324.77 341.44 359.02 205.00 240.00 272.00 296.70 316.40 346.70 389.70 414.10 456.40 4986.5 AVOMu TW (rlD/-3) 0.066 0.105 0.120 0.141 0.160 0.180 0.206 0.215 0.071 0.073 0.093 0.094 0.106 0.106 0.123 0.140 0.160 0.187 OPERATING REVENUES I sewoiugCl,hgs 7.25 0.46 11.97 15.31 19.17 23.69 26.95 32.53 6.57 5.69 .14 8.39 9.64 10.30 12.63 15.03 17.53 22.20 Uun&dph Cor*bAIOns 3.60 3.96 4.36 4.79 5.27 5.60 6.36 7.02 4.24 4.80 5.60 5.27 5.39 5.39 539 5.39 5.38 7.70 ConawdluonsAowww 0.48t 0.63 0.89 1.01 1.45 2.02 2.54 3.16 1.30 0.99 1.40 1.12 0 99 169 3.22 3J85 6.0 4.70 M _lchlanecus 0.43 0.69 0.8 1.06 1.32 1 66 2.12 2.62 Cownpenaory PRwvfus 4.30 3.00 2.50 1.50 _ 4.00 4.02 4.25 4.62 4.72 4.76 5.00 5.40 5.50 6.80 Ls: Bed OWProvson -0.11 0.14 .0.11 -0.23 0.29 .035 0.43 -049 TOTAL REVENUES 15.95 17.60 20.42 23.46 26.92 32.4 3956 44.84 15.11 15.70 19.39 19.40 20.94 22 14 26.44 2967 36.21 41.40 OPERATING EXPENSES P.ruoEmo ( 4.39 S.15 6.02 7.18 6.55 9.97 11.32 12.83 424 549 5.91 6.28 e42 723 652 096 11.10 1320 Energy awtW 1.42 1.63 2.05 2.47 2.70 3.06 3.46 3.92 1.56 1,22 1.41 1.64 2.05 2.06 2.13 234 260 2.60 M3I.hlul 1.22 1.40 1.60 1.64 2.12 2.44 2.83 3.26 1.26 166 1.50 1.51 1.98 2.82 3.29 3.79 3,90 4,30 To4. s.McsMsAnhi4,rmIIv. bix.sexpe 0.80 0.89 0.93 1.00 1.11 1.20 1.32 1.45 0.55 065 1.40 2.04 1.56 123 2.63 5.37 6595 600 SubT_ T 7.83 9.07 10.60 1249 14.48 16.67 10.93 21.48 7.63 9.22 10.22 11.47 1ZO 13.34 16.57 21.46 23.56 26.10 op0chin 4.38 5.10 5.76 6.62 7.42 6.43 9.45 10.62 4.47 4.94 5.26 5.60 7.59 11.21 8.63 7.45 10 65 1160 TOTAL OPERATING EXPENSES 12.21 14.17 16.36 10.11 21.90 25.10 20.38 32.10 12.10 14.16 15.48 1727 19.59 24.56 25.20 26.91 3420 37.70 NET OPERATING INCOIE 374 343 4.06 4.35 5.02 7.74 11.16 12.74 3.01 1.54 3.91 2.13 1.36 -2 41 124 0.76 1.01 3.70 IlrhIst 2.62 3.24 3.75 4.30 4.6 5.70 6.92 6.25 2.49 3.35 3.06 3.40 3.63 3.865 3.69 3.26 290 3.10 Non oparalne hom NET INCOM-E 1.12 0.19 031 0.06 0.16 204 4.26 4.49 0.52 -t 063 -1.27 -2.2 4.26 -2.45 -250 t1. 060 OpifalMo Rib 76.56 00.51 60I.2 81.46 81.35 76.43 71.74 71.59 60.06 90.1 70.63 69.a2 03.56 110.09 95.31 97.44 97.1 91.06 WodmA raw 6721 0. 12 56.1 8.881 6&79 50.76 47.8 47.90 6868 7694 67.50 77.60 7.96 7675 7729 8.42 70.27 754  OeM& THNW3 URBAN SEWERAE PRWCT CASH flOW STATEMEtU3T FascslyEndngDaCsW 31 19E3 1984 1985 low 1987 198 1969 1990 1983 1984 1985 l98 1987 1988 1989 1990 1991 1992 NaiO Wo"babM opadaptdlon 31112 8.53 9.82 i0.g7 12.44 1617 20.63 23,38 6.8 7.29 9.58 3.43 10.70 3.58 10 42 9.14 11.04 18.10 Non Opwnuhin hcoxme | -1.41 1.92 4.009 11 -0.06 -0.15 0.94 2.00 1.30 1.40 Gioss intnW Garilon 1.12 853 9.82 10.97 12.441 16.7 20.63 23.38 '7.27 9.21 9.47 8.32 10.62 3.43 11.36 11.14 12.34 17.50 *.Oarsln ij t Ianl It-a (Dac ) in wodlg CaN .1.02 -0.16 0.87 0.47 -2.63 0.65 1.75 2.06 0.16 .089 40.04 3.7t 10.77 -3.24 3.31 6.38 -3.03 -4.10 Do" SAc: ' _ = kAorl chagd to opefuon 2.2 324 175 4.30 4.86 5.70 6.92 8.25 2.49 3.35 3.08 3.40 3.63 3.85 369 3.26 290 3.10 Amo.uzal onf dLans 2.33 8.01 3.05 3.10 4.40 8.26 6.78 6.54 2.18 3 0 2.86 3.00 4.21 6.46 7.20 9.70 12.43 15.50 ToZe d4 5iSM 4.96 6.25 6.30 7.40 9.26 11.9 13.70 15.09 4.67 6.35 594 6.40 7.U4 10.31 1059 12.96 15.33 18.60 TOTAL OPERATIONAL REOUIREMEN 3.93 6.10 7.67 7.87 6.73 12.63 15.45 17.14 4.83 5.46 5 90 10.11 18 61 7.07 14.20 19.34 1Z30 14.50 asano sofl emal Funds Avsb.i or 4.19 2.43 Z15 3.10 5.71 3.J4 618 6.22 2.44 3.75 3.57 -1.79 -7.99 -3.64 -2.84 a20 0.04 3.00 ToEa Capia Expendiluros 26.70 22.91 3030 2.50 38-00 42.00 45.00 47.00 17.60 17.70 16.00 12.40 21.80 20.60 20.90 25.20 31.40 42.8o lnease nlon.-TrmAdmncas 0.69 0869 0.54 0.6a 1.10 18.4 1.74 1968 058 051 0 62 0.25 0.09 40.58 1t71 0.18 0862 t60 TOW tCap Invatlrw neasn 29.39 23.60 306 4 29.18 39 10 43a64 4.74 48.96 18.18 1821 1662 12.66 21.89 2M02 22.61 25.38 32.02 44.40 _ ___ _ __ _ _ Balancelo be d25.20 21.17 28.69 26.08 33.39 40.10 415.6 474 15.74 14.46 13a05 1444 29.88 23.68 25.45 335 s 31.98 41.40 financd by- I_ _ _ _ _ _I_ Total ExIsng Loan 15.J6 7.27 5.22 1.84 0o00 0.00 0.00 0.00 7.77 6.08 4.47 3.17 15 45 7o00 6 80 5s60 10o43 19.70 Popod Baw* Lowm 0.75 2.25 3.64 4.28 4.29 4.07 2.14 0 00 0.20 1.15 1.32 3.43 4.50 2.90 3.00 2.10 2.60 Otn Lons - Popobd 0.30 3.20 4.70 56.0 5.86 6.54 3.04 1.00 Othet Loan t-ikenUfed 2.30 13.00 19.70 25.00 TOTALLOANS 32.77 19.99 18.781 13.76 12.45 23.61 2488 26.00 15.54 12.36 1009 7.66 34.33 11.50 16.50 14.20 2296 42.00 Gouvwwamwmanc4nklixlons 7.70 10.501 12.00 14.50 13.50 12.501 11.50 10.50, 7.70 7.20 12 50 8.90 5.10 6.70 4.50 13.90 15.401 10 20 CUSlomarconlilb.*ons 1.11 1.12 1.75 2.25 3.16 4.43 5.44 8.81 0.30 0.50 0 90, 0.90 1.77 1.52 3.11 434 3.26 2.50 TOTAL FUNOING 41.58 31.61 32.53 30.51 29.13 40-54 41.82 43.31 23564 20.09 23.49 15.40 41.20 26.72 24.11 32.44 41.82 54.70 Cashlocrease (Decraaa) qYew 16.38 10.44 3.84 4.43 -4.26 0-44 0.26 0.57 7.80 5.60 10.44 1.02 11.32 3.06 -1.34 -1.14 964 13.30 Csh al Begibg ot Yaw 1.66 16.4 26.48 32.32 38.75 32.49 323 33_19 0.20 8.00 13.60 24.04 25.0 3a.38 39.44 38.10 6 968 4660 Cash stand of Yew 16.04 284 32.32 36.75 3249 32.93 33.19 3376 8.00o 136 2404 25.0s 386.3 39.44 38.10 36.98 46.60 so.9 Dopa SeAs ca-of _ __) 1.6 1.4 1.4 1.6 1.3 13 6S 1. 1.6 1.5 1.6 1.3 1.4 0e3 10 0o 9 0.e 0o9 SeE fnanc:ig _ _ 1%: trnwonMbUon 20.0 13.0 013 1571 21. 17.6 22.2T 2.3. 151 24. 30. 462 -297 -99 Ii1 -1. 86  ONAS- rTHllR O UB SEWEPALZE PROJET BALANCE SHEETS (rD mluloa AMAISMI FeIXCa Ad1 - - Ml -- Meetl year EndIng Decemnbe 31 1983 194 198s 1988 1987 198" 1988 1980 1983 1984 1985 98a 1987 IM8 1989 1990 1991 1992 ASSETS Moxd AS-liS Ggoss FixodAssels 115.59 135,761 162.13 190.91 22095 257.66 296.89 337.10. 84.94 109-98. 119.96 138.36 169.66 182-76 195.80 202.95 254.10. 303.70 Less: Mcc. Depreciation 20.14 26,24 31.00 37.62 46.04 53.47 62.92. 73.54 19.971 24.911 30.17 35.97. 43.68 54.77 63.40 70.85 81.60 93.10 Net FIxed Anssts 95.45 110.52 131.13 153.35 175.91 204.16 233.971 263.56 64.971 85071 89.79 102~39 126.10 127.90 132-40 13210 172.60 21060 WorkIlnProgress 24.37 27.11 31.04 30.70 38.72 44.02 49 78 56.57 43.96 37.40 45.38 40.30 40 91 53.90 71.40 90 90 83.70 96.50 TOTAL FIXED ASSETS 11982 137.63 16217 154.051 214.63 241210 283.75 320.13 106 92 122.47 135.17 142.69 167.01 181.89 203850 2230 258 30 307.10 Long-IenrmAarvances 1.93 2.62 3.16 3.84 4.94 65 8a032 10 28 2.20 2.71 3.33 3.5a 3.67 309 4.80 4.981 660 7.20 Sub-Total 121.75 140.25 165,33 187.88 219.57 254.78 292.07 330.41 I11.12 125.18 138.50 148.27 170.88 164.98 208.60 227.981 261.90 314-30 CURRENT ASSETS Cash and equivalent 2.18 5.35 3.97 6.56 2.30 2.74 300 3.57 0 341 0.06 6.081 7.811 3.63 5.90 4.30 5.00 4.901 3.10 Receivables 1.65 2.05 2.49 3.08 3.75 4.531 5.43 6.09 2.25 2.94 5.43 4.80 65.4 520 8.21 8 36 7.50 900C Och.rm Flecelvablea 2.36 2.63 3 35 4.11 5.14 6.51 8.15 10.16 393 6 95 7.25 68a7 to081 12.46 13.63 21 80 28.10 19 50 kr.venoiles 0.87 0.90 0.93 1.071 1.24 1.42 1.65 1.91 1.41 1.5.6 1.51 1.75 2 54 2.14 2.17 2.75 3.10 3190 Total Cunernlassets 7.061 10.93 10.74 14.821 12.43 15.20 18.23 21.73 7.9.3 11.51 20.27 21.23 23.02 25.70 28.31 37.91 43.60 35.50 TOTAL ASSETS 128.81 151.18 176.07 202.71 232.00 269.98 310.30 35214 119.05 136.69 168.77 167.50, 193.70 210.68 236.91 265.89 305.50 349.80 EOUITY AND LMAIL!ITES ___ ___ Governumet ConIribuilona 52.38 62.68 74.816 89.36 10.8 115.36 126.86 137.36 56.40 63 80 77.30 89.00 103.86 118.80 137.49 179 38 208 00 242.40 Cuslornw Cont,llxkIon 12.30 13,42 15.17 17.42 20.60 25.03 30.47 37.281 680o 810 10.00 10.90 13.717 14.69 19.80 24-64 27.90 30.40 Retaflned Surplus 5.13 70o6 8.11 10.14 12.18 14.72 18.9a 23 62 6.74 6.66 7.79 6.91 6.30 -2 07 -3.041 -2.61 -3850 -1.00 Total EqulyV 69.79 83.34 98.14 116.92 1345.64 156.11 178.31 1918.26 68.984 78L55 95.09 108-81 123.33 1.31.42 154.251 201.41 2321 271.80 ProposedllRD Lowna 0.75 3,00 8.64 10.10 12.74 15.16 15.66 14.01 0.00 0 20 1.35 1.57 2.80 5.10 5.70 6.30 6 620 Prevkltu l0RO Loom 23.48 255s6 26.05 24.13 22.15 20.12 18.02 16.87 15.81 16_64 18.29 18.18 18.10 17.55 15.70 13.78 11.60 10.40 OU'memexistng Lawns 21.95 24.09 25.03 24.97 23.62 22.27 20.92 1 9.66 16.05 18.44 18.26 18.43 29.70 32.26S 33.20 11.39 10.90 15.50 OUwaprpowp d Loans 0.30 3560 8.20 13.56 18.12 22.91 24.28 23.51 _ _ Unkdenlile Lawns 2.30 1530 35.00 58.92 Total LonIQ4m D.I 48.48 5615s 66.92 72.76 78.93 95.76 113.86 132 87 31.86 35.28 37.90 38.18 50.60 54.90 54.60 31.47 28.50 3210 Cuxreti I-labillels sup9IIehs 856f 7.72 7.881 7.48 9.91 10.97 11.79 12.38 6.56 6 23 6.28 6.23 6 05 8.30 7.281 9.90 14.10 15 60 A~OCunls Payable 0.97 0.92 1.03 1.15 1.24 1.36 1.50 1.85 869i 13.77 16.51 13.07 7.26 881.6 10.78 10.68 15.30 11.60 Cinen mtMalwfl 3.01 3,05 3.10 4.40 6.28 6.78 6.84 6.98 3 00 2.86 3.00 4.21 6.46 7.20 10.00 12.43 15.50 l8.70 TOtal Currant UabUUee 1254 I1169 1201 13.03 17.43 19.11 20.13 21.01 18.25 22.86 .25.79 22.-51 19.7? 24.38 28.06 33.01 44.90 45.90 TOTAL EQUITY ANO LIA11ILTMES 128.811 161.151 176071 20.711 232.00 269.961 310.30 352.14 119.051 136.891 1511.78 197.501 193.70 210,68 236.91 265.801 306.50 349.8 Reli 2m 8.42 311.1161 39.-9 38.06 36.73 37.96 38.90 39.71 291.211 27.90 2578 5.1 284 29.48 27.27 16.51 140 1.2  - 40 - Third Urban Sewerage Project Implementatlon Schedule Rem Zone 1982 1983 1984 1985 198 1987 1988 1989 1990 1991 1992 1993 Pipe procurement contract t F -2-3 --I-A- - R I- contract 2 F 4-5-6 -p-- A- -_ R t A-- Contract 3 F 7-8 p , A Sewer svstems F p North R 1 - p-- A-_- Interior F 2 _ p_ , A R I Sahel 11 F 3 - p-l--|A - - South F 4 I Cap Bon II F 5 -p---- _-- - - _ Sfax F 6 -p- -_--- A Cap Bon I F 7 -p-l- -A- - Sahel I 8 a-p-I-A-_ _ A_ Treatment Plants First group F 2-4-6 -p- - -- -A-- - - R -p- -p- -p- -p-- --p--I- - - Second group F 3-5-7-8 -P- - I- - - _ _ A --p-- -p-I -A-- Miscellaneous Omces F Tunis -p- I-A- - _ 1--I Operating e-quipmeni F All Ik- -A- I-A-I--iA A I- -A- I-A- I-A- i-A- Feasibillty study F RAA Computerlzatlion study F F - Forecast, I - Bid invitatlon -p- - preparation and studies R - Reailzed A Bid award  - 41 - THIRD URBAN SEWERAGE PROJECT LOAN 2255-TN WITHDRAWALS CATEGORIES ACTUAL (in $) UPDATED FORECAST INMAL FORECAST Civil works and line-laying 14,768,712.07 13,300,000 14,240,000 Supply of equipment and pipe 16,575,274.44 15,900,000 13,300,000 Consultant services and studies 1,477,650.77 2,996,000 2,930,000 Front-end fee 253,102.00 253,102 253,102 Unused 925.260.72 1.550.900 3.246.898 TOTAL: 34,000,000.00 34,000,000 34,000,000  - 42- THIRD URBAN SEWERAGE PROJECT LOAN 2255-TN PROJECT COMPLETION REPORT LOAN DISBURSEMENTS (US$ millions) Planned Actual Year Partial Cumulative Cumulative Partial Cumulative Cumulative in % in % 1984 2.72 2.72 8% 0.253 0.253 0.7% 1985 4.76 7.48 22% 1.355 1.608 4.7% 1986 6.46 13.94 41% 1.571 3.179 9.4% 1987 6.80 20.74 61% 4.135 7.314 21.5% 1988 6.80 27.54 81% 5.211 12.525 36.8% 1989 4.76 32.30 95% 3.143 15.668 46% 1990 1.70 34.00 100% 3.358 19.026 56% 1991 2.208 21.234 62.5% 1992 3.560 24.794 72.9% 1993 8.281 33.075 97.3%  ORGANIGRAMME ACTUEL (..YPREiD,ENTDiRECTEURA Di3iDP IETD DISECTIRT D