Philippines - Metro Manila Urban Transportation Integration Project

Document of The World Bank Report No: 20767-PH PROJECT APPRAISAL DOCUMENT ON A PROPOSED LOAN IN THE AMOUNT OF US$60.0 MILLION AND A GLOBAL ENVIRONMENT FACILITY GRANT OF SDR 1.0 MILLION (US$ 1.3 MILLION EQUIVALENT) TO THE REPUBLIC OF THE PHI-LIPPINES FOR THE METRO MANILA URBAN TRANSPORT INTEGRATION PROJECT MAY 23, 2001 East Asia and Pacific Region Tr2nsport Sector Unit  CURRENCY EQUIVALENTS (Exchange Rate Effective May 23, 2001) Currency Unit = Philippine Pesos (PhP) 1 PhP = US$0.02 US$1 = PhP50 FISCAL YEAR January 1 -- December 31 ABBREVIATIONS AND ACRONYMS ADB Asian Development Bank CAS Country Assistance Strategy DBM Department of Budget and Management DENR Department of Environment and Natural Resources DPWH Department of Public Works and Highways DOTC Department of Transportation and Communications ECC Environmental Compliance Certificate EDSA Epifanio de los Santos Avenue EIAPO Environmental Inpact Assessment Project Office GEF Global Environment Facility GHG Greenhouse Gas ICB International Competitive Bidding LGU Local Government Unit LRT Light Rail Transit MARIPAS Marikina, Rizal, Pasig MMDA Metropolitan Manila Development Authority MMURTRIP Metro Manila Urban Transport Integration Project MMUTIS Metro Manila Urban Transportation Integration Study NCB National Competitive Bidding NCTS National Center for Transportation Studies NEDA National Econormic and Development Authority NGO Non-Governmental Organization NMT Non-Motorized Transport NRIMP-1 First National Roads Improvement and Manag. Project PMO Project Management Office QCBS Quality- and Cost-Based Selection TEC Traffic Engineering Center URPO Urban Roads Project Office VOC Vehicle Operating Cost Vice President: Jemal-ud-din Kassun Country Director: Vinay K Bhargava Sector Director: Jitendra N. Bajpai Task Team Leader: Sally L. Burninghiam  PHILIPPINES METRO MANILA URBAN TRANSPORT INTEGRATION PROJECT CONTENTS A. Project Development Objective Page 1. Project development objective 3 2. Global objective 3 3. Key performance indicators 3 B. Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project 4 2. Main sector issues and Government strategy 5 3. Sector issues to be addressed by the project and strategic choices 9 C. Project Description Summary 1. Project components 10 2. Key policy and institutional reforms supported by the project 13 3. Benefits and target population 13 4. Institutional and implementation arrangements 14 D. Project Rationale 1. Project alternatives considered and reasons for rejection 16 2. Major related projects financed by the Bank and other development agencies 17 3. Lessons learned and reflected in proposed project design 18 4. Indications of borrower commitment and ownership 19 5. Value added of Bank support in this project 19 E. Summary Project Analysis 1. Economic 20 2. Financial 21 3. Technical 22 4. Institutional 22 5. Environmental 23 6. Social 24 7. Safeguard Policies 26 F. Sustainability and Risks 1. Sustainability 26 2. Critical risks 27  3. Possible controversial aspects 28 G. Main Loan Conditions 1. Effectiveness Condition 28 2. Other 28 H. Readiness for Implementation 29 I. Compliance with Bank Policies 29 Annexes Annex 1: Project Design Summary 30 Annex 2: Detailed Project Description 34 Annex 3: Estimated Project Costs 43 Annex 4: Cost Benefit Analysis Summary 45 Annex 5: Financial Summary 54 Annex 6: Procurement and Disbursement Arrangements 55 Annex 7: Project Processing Schedule 71 Annex 8: Documents in the Project File 72 Annex 9: Statement of Loans and Credits 73 Annex 10: Country at a Glance 75 Annex 11: Project Information Brochure 77 Annex 12: Institutional Framework for Traffic Engineering and Transpott Planning 79 Annex 13: Global Environment Facility (GEF) supported Non-Motorized Transport component - 84 Marikina Bicycle Network. Estimation of the benefits deriving from the savings in greenhouse gas emissions Annex 14: Global Environment Facility (GEF) supported Non-Motorized Transport component - 93 Marikina Bicycle Network. Incremental Cost Analysis MAP(S) IBRD 30420 - Traffic Management and MARIPAS components IBRD 30421 - Secondary Roads components  PHILIPPINES Metro Manila Urban Transport Integration Project Project Appraisal Document East Asia and Pacific Region Transport Sector Unit Date: May 23, 2001 Team Leader: Sally L. Bumningham Country Director: Vinay K. Bhargava Sector Director: Jitendra N. Bajpai Project ID: P057731 Sector(s): TU - Urban Transport Lending Instrument: Specific Investment Loan (SIL) Theme(s): Poverty Targeted Intervention: N Global Supplemental ID: P066509 Team Leader: Sally L. Burningham Sector Manager/Director: Jitendra N. Bajpai Supplement Fully Blended? Yes Sector(s): TU - Urban Transport Program Financing Data [XI Loan [ ] Credit [ Grant [ Guarantee [ Other: For Loans/Credits/Others: Amount (US$m): US$60 million | Proposed Terms (IBRD): Fixed-Spread Loan (FSL) Grace period (years): 8 Years to maturity: 20 Commitment fee: 0.85% the first four years; 0.75% Front end fee on Bank loan: 1.00% thereafter Financing Plan (US$m): Source Local Foreign Total BORROWER 36.30 0.00 36.30 IBRD 29.60 30.40 60.00 GLOBAL ENVIRONMENT FACILITY 0.50 0.80 1.30 Total: 58.60 39.00 97.60 BorrowerlRecipient: REPUBLIC OF PHILIPPINES Responsible agency: DPWH Department of Public Works and Highways Address: Bonifacio Drive, Port Area, Metro Manila, Philippines Contact Person: Mr. Teodoro Encarnacion, Undersecretary for Technical Services Tel: 63-2-304 3228 Fax: 63-2-304 3485 Email: n/a Other Agency(ies): Metro Manila Development Authority Address: MMDA Building, EDSA Corner Orense Street, Guadalupe, Makati City, Metro Manila, Philippines Contact Person: Mr. Benjamin S. Abalos, Chairman Tel: 63-2-882 0908 Fax: 63-2-882 0859 Email: ogm(@mmda.gov.ph City of Marikina, Metro Manila Address: Brgy. Sta. Elena, Shoe Avenue, Marikina City, Metro Manila, Philippines Contact Person: Mayor Bayani Fernando Tel: 63-2-646 1634 Fax: 63-2-646 5277 Email: marikina@Mozcom.com  Estimated disbursements ( Bank FYXUS$m): FY 2001 1 i2002 1 0 2003 0 2004 J 2005 I 2006 i Annual 0.00 1.70 8.23 1 25.60 I 17.35 7.12 Cumulative 0.00 1.70 9.93 35.53 52.88 60.00 Project implementation period: 5 years Expected effectiveness date: 09/01/2001 Expected closing date: 09/01/2006 OCS PAD F.w- Rev MmdC, 2 -2 -  A. Project Development Objective 1. Project development objective: (see Annex 1) The project development objective of the Metro Manila Urban Transport Integration Project (MMURTRIP) is to assist the Government of Philippines in enhancing the economic productivity and quality of life of Metro Manila residents by improving the operational efficiency and safety of the transport system with better opportunities for access to public transport and nonmotorized transport, the dominant transport modes of low-income residents. To this end, the project will implement schemes of traffic management to improve access to newly opened Light Rail Transit stations and transfer opportunities between road-based public transport modes, pedestrian circulation, road frontage controls, street lighting, and traffic circulation in general. Physical measures in the project corridors/areas will also improve critical interchanges and provide road access and missing links. To promote the use of nonmotorized transport, the project will implement a local bike path network and a supporting awareness campaign. Institutional measures will aim to strengthen the Metropolitan Manila Development Authority (MMDA), the agency responsible for coordinating development plans and programs, and specifically, traffic management across the 12 cities and five municipalities of Metro Manila. 2. Global objective: (see Annex I) The global environment objective of the proposed Nonmotorized Transport Global Environment Facility (GEF) supported component is to reduce greenhouse gas emissions by promoting the use of zero-emission bicycle and pedestrian transport in the City of Marikina as an alternative to greenhouse gas-emitting motorized transport. A second objective is to demonstrate and publicize the benefits and viability of bicycles as an alternative transport mode to encourage replication of this pilot program in other parts of Metro Manila, elsewhere in the Philippines, and in other countries. 3. Key performance indicators: (see Annex 1) The key performance indicators, to be measured along the project corridors, are: Objective Actions Indicators A. Provide better opportunities Improve travel conditions, * Reduced travel time. for access to public transport including the related safety and * Sustained proportion of public facilities by improved traffic environmental aspects, along the transport use. management. three most heavily used public * Improved satisfaction of public transport corridors in Metro transport users. Manila (along Light Rail Transit Line 3; EDSA; LRT Line 2-Aurora Boulevard, and the Southem Corridor). B. Enhance access from the Implement a series of projects in * Reduced travel time. outer areas to Metro Manila. Marikina Valley on the key * Sustained proportion of public access routes to Metro Manila. transport use. * Improved satisfaction of public transport users. -3 -  Objective Actions Indicators C. Improve operational Invest in strategic secondary * Reduced travel time. efficiency through an improved roads. * Sustained proportion of public road hierarchy. transport use. * Improved satisfaction of public transport users. D. Enhance quality of life Promote the use of nonmotorized Sustained or increased mode share for through increased use of transport through a pilot non-motorised transport trips. non-motorised transport and demonstration in one of the local thereby address air pollution. government units (LGUs), the City of Marikina. E. Improve metropolitan Strengthen capacity of * Effective coordination mechanism governance in traffic matters in Metropolitan Manila in place between the key agencies Metro Manila. Development Authority and Local Government Units. (MMDA) and involve them as * Effective traffic management and direct project implementers. enforcement measures planned and designed by the relevant agencies B. Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project: (see Annex 1) Document number: R99-55(IFC/R99-46) Date of latest CAS discussion: 05/04/99 To help the Philippines achieve its overarching goal of poverty reduction, the World Bank Country Assistance Strategy (CAS) policies and programs are directed to seven areas consistent with the Medium- Term Philippines Development Plan: 1. Address crisis effects and promote economic recovery. 2. Enhance human development and social services for the poor. 3. Accelerate environmentally sustainable rural development. 4. Promote sustainable urban development and combat urban poverty. 5. Develop infrastructure, particularly in the provinces. 6. Enable expansion of the private sector. 7. Improve governance and transparency and combat corruption. Among medium-term development priorities of the Government of the Philippines, the CAS highlights the need to target transport problems in Metro Manila. The MMUTRTRIP project will improve and develop the basic transport infrastructure (item 5) and promote sustainable urban development (item 4) by providing necessary transport access to fast-growing outer areas, particularly to the low-income population that depends on public transport modes. la. Global Operational strategy/Program objective addressed by the project: The Nonmotorized Transport component is consistent with the objectives of Global Environment Facility (GEF) Operational Program 11 on Transportation, which states that "GEF will promote, amongst others, nonmotorized transport technologies and measures, especially in medium-scale growing cities." The Nonmotorized Transport component will demonstrate that bicycle networks are a low-cost, convenient, and acceptable alternative method of city transportation over short-to-moderate distances and have excellent - 4 -  prospects of sustainability. This component has strong local government and nongovernmental organization support and is a national priority for GEF assistance. 2. Main sector issues and Government strategy: Urban transport congestion, with its related impacts, is one of the most pressing problems in the Philippines. The key area for concern is Metro Manila, now a massive, gridlocked urban area that accommodates 10.2 million people (1997), produces over one-third of national GDP, and contains 17 Local Government Units (LGUs), of which 12 are cities and five are municipalities. By 2015 Manila is expected to become a massive conurbation of 13 million (MMUTIS 1996). Economic prosperity in recent years has accelerated motorization and the demand for mobility, causing severe traffic congestion and environmental problems. Residents perceive traffic congestion as their number one problem, followed by air pollution (the primary source of which is the transport sector), garbage collection, flood control, and the need for security. The level of congestion in Metro Manila is severe enough to cause an average travel speed of 10 kilometers per hour, only slightly faster than that of Bangkok, which has the slowest travel speed of any major Asian city (figure B. 1). Figure B.1 Average travel speed in major Asian cities 35 - 30. 30 - _ _ 25 e2 - - 20 15 15 15 15 .. - 0 Figure B.2 Typical traffic congestion on EDSA in Metro Manila, May 27, 2000 -5-  The Metro Manila Transportation and Traffic Situation Study Household Interview Survey of the 1996 MMUTIS study involved interviews of 235,000 people, or 50,000 households (about 2.5 percent sampling). The survey showed that about 20 percent of households in Metro Manila own cars, fewer than in many other large cities in the region. Despite a trend of rising car ownership in recent years, public transport has always been the dominant transport mode in Metro Manila, and the population depends heavily on road-based public transport modes in the form ofjeepneys and more recently FXs, a type of shared taxi. Table B.1 Metro Manila socioeconomic profile Philippines GDP per capita (1999) US$1,020 Metro Manila GRDP per capita (1996) PhP 59,580; US$1,490 Population of Metro Manila (1997) 10.2 million Percentage of households owning cars (1996) 20 Car ownership per 1000 population (1996) 59 Household income, average per month (1996) PhP 12,356; US$309 per household Households below poverty line (1996) 6.5 percent Source Population: World Bank documents; car ownership and poverty: MMUTIS 1996. Data from the 1996 MMUTIS household interviews show that 79 percent of motorized trips were made by public transport (41 percent by jeepney, 13 percent by bus, 19 percent by tricycle, 2 percent by light rail transit, 5 percent by taxi, and a negligible proportion by the Philippines National Railway), while only 21 percent were made by private car or utility vehicle; 20 percent of total trips were walking trips. This split is unlikely to be influenced by the completion of the two new Light Rail Transit (LRT) Lines 2 and 3. The existing LRT Line 1 operates at capacity, carrying about 350,000-400,000 passengers per day. The LRT Line 3 along EDSA opened in December 1999 and currently averages about 65,000 passengers per day. The LRT Line 2 is under construction and due to open in 2002. The prediction of a dramatic increase in the percentage of private car use from 22 to 34 percent and decrease in the percentage of public transport use from 79 to 66 percent (Table B.2) by 2015 is worrying. Table B.2 Trip modal split in Metro Manila Transport 1996 2015 2015/1996 Motorized Public 18.5 million/day (79%) 28.9 million/day (66%) 1.56 Private 4.7 mnillion/day (21%) 14.8 million/day (34%) 3.15 Total 23.2 million/day (100%) 43.7 million/day (100%) 1.88 Walking 6.5 mnillion/day 10.8 million/day 1.66 (22% of total) (20% of total) Total 29.7 million/day 54.5 million/day 1.84 Source: MMUTIS 1996 It is also interesting to note that 30 percent of trips are less than 2 kilometers (Ian) in length and these trips are thought to be contributing to a large amount of the congestion (Table B. 3). - 6 -  Table B.3 Motorized tri ps by mode and distance in Metro Manila (1MUTIS study area) Predominant travel mode Total trips Trips < 2 km Percent of trips<2km Car + Utility vehicles 4,658,760 1,057,398 22.7 Tricycle-motorized 4,307,129 2,425,283 56.3 Taxi 1,152,654 184,361 16.0 Jeepney 9,574,501 3,067,772 32.0 Bus 3,034,977 126,289 4.2 Light Rail Transit (LRT) 442,164 8,108 1.8 National Railways 7,275 369 5.1 Total public 18,518,700 5,812,182 31.4 Total private 4,658,760 1,057,398 22.7 Grand total 23,177,460 6,869,580 29.6 Source: MMUTIS 1996 The main sector issues and the Govenmment's strategy to address them are described below. The need for traffic management. In general, road construction in Metro Manila has not taken into account the stop and dropoff sites, transfer points, and waiting areas needed by buses, jeepneys, and tricycle services. The resulting chaotic traffic along major corridors and near road junctions severely affects the overall traffic flow, causes delays, and increases safety hazards. Because of insufficient sidewalks and crossings, pedestrians often encounter hostile and dangerous street conditions. Given Metro Manila's high dependency on road-based public transport (buses and jeepneys), imnproved traffic flows would directly affect the capacity of the public transport system and related environmental and safety conditions. Without efficient street-level collection and dispersal of light rail passengers, and efficient traffic to and from expressways, mega-investments will not be fully effective. Traffic management deserves the highest priority in the sector and should become the most essential housekeeping function of Metro Manila. Whereas European cities have done much to encourage the return of walking and cycling through innovative pedestrianization, traffic-calming schemes, and other initiatives, walking and cycling are being squeezed out of Asian cities (especially developing Asian cities) through increasingly hostile traffic and urban environments and lack of policy attention. Currently, only Japan and Singapore are trying to enhance conditions for these modes. Such an approach requires strong coordination among the responsible agencies in the Philippines: for physical improvement -- the Departrnent of Public Works and Highways (DPWH), and Local Government Units (LGUs); for traffic operations and control -- DPWH, the Metropolitan Manila Development Authority (MMDA), and LGUs; and for the enforcement of regulations -- the police and the Department of Transportation and Communications (DOTC). To address this issue, the MMDA was assigned the responsibility of coordinating traffic operational enforcement. Though the MMDA has made some progress, there is room for considerable improvement. In addition to adequate hunan and financial resources in the MMDA, strong Govenmment commitment is needed to streamline the overlapping roles of national agencies and the MMDA in Metro Manila. The need for enhanced access from outer areas. As Metro Manila rapidly expands outside the circumferal boundary of EDSA, the constraints posed by current transport access to these outer areas are becoming more evident. People seeking work in Metro Manila experience long commutes, and residents perceive accessibility and public transport services as poor. For example, vehicle ownership in both the Marikina Valley and Rizal Province, despite lower-than-average household incomes, is 24 percent compared with about 20 percent in Metro Manila, because people see private transport as a necessity to - 7 -  combat these constraints. There are approximately 500,000 trips to Metro Manila daily from the Marikina Valley area, and an additional 135,000 pass through Marikina Valley from eastern Rizal to Metro Manila for which the primary routes are Marcos Highway and Ortigas Avenue. The need to improve the road network hierarchy. To facilitate better dispersal of traffic over the network and reduce traffic on arterial roads, overall netwvork capacity needs improved connectivity and enhanced capacity of existing secondary roads. These can be achieved by implementing missing links; rehabilitating pavements, sidewalks, and drainage; and controlling/removing encroachments. The need to address air pollution: local impacts and global impacts. Residents rate air pollution as the area's number two quality of life problem, after traffic congestion. Mobile source air pollution from the transport sector is the major cause of air pollution in Metro Manila. The Government is pursuing a combination of pricing and administrative control measures to bring mobile emissions down to a healthier level. The ongoing Metro Manila Air Quality Improvement Sector Development Program, with US$300 million financing from the Asian Development Bank, aims to promote the use of cleaner fuels and a vehicle inspection program directed mainly toward local impact pollutants. The program includes a motor vehicle inspection system, an industrial air emissions pollution abatement program, production of cleaner fuels, introduction of antipollution devices such as catalytic converters, anti-smoke belching, road rehabilitation, ambient air quality monitoring, public awareness raising, capacity building, and institutional development. The Air Quality Improvement Program does not address nonmotorized transport. In the less congested outer areas of Metro Manila, such as the City of Marikina, about 2 percent of all trips are by bicycle, but the anticipated increase in traffic will likely cause the disappearance of this mode of transportation. This pattern has already been experienced in inner Metro Manila (and in many other Asian metropolises) where bicycles have been crowded out by overwhelming traffic, resulting in the loss of a nonpolluting means of transport. The contribution of motorized fonns of transport to global greenhouse gases is significant. The Philippines has ratified the United Nations Framework on Climate Change Convention (UNFCCC) and is a cosignatory to the 1997 Kyoto Protocol. This reflects the country's strong commitment to addressing its contribution to GHG emissions. On a global scale, motor vehicles play a significant role in the emission of GHGs, with the greatest contribution made by carbon dioxide (COC2) , the greenhouse gas so far most responsible for atmospheric change. Road transport contributes 15 to 20 percent of CO emissions worldwide. Since the amount of CO2resulting from the combustion of a given quantity of gasoline remains constant regardless of emission controls, trends in CO2emissions will directly follow increases in the use of these fuels. Therefore, motor vehicles have the potential to play an even greater role in increasing the greenhouse gas effect in the future. Thus preserving or reversing the modal split to less polluting and nonpolluting modes is an important objective from both a local and a global point of view. The need for implementation of an urban transport strategy in Metro Manila. To date in Metro Manila, national agencies have sponsored mode-specific plans and policies, with limited regard for developing an integrated, intermodal transport system. Due to land acquisition and fiscal constraints, road network expansion has been limited (only about 75 kilometers of new roads have been constructed since 1982). To address infrastructure and development issues that transcend the municipal boundaries of the 17 LGUs comprising Metro Manila, the Government established the MMDA in March 1995. To date, the MMDA has been less effective in its mandated role in metropolitan transport planning and traffic operations management. Strengthening under both the Metro Manila Air Quality Improvement Sector Development Program and the MMURTRIP project will contribute to the efficacy of the MMDA. The Government approved a reorganization of the agency on March 15, 2000. The MMDA's Letter of Sector - 8-  Policy outlines its action plan for implementing the MiMIJTIS study (see Annex 11). To develop a long-term strategy, the Government undertook the Metro Manila Urban Transportation Integration Study (MMUTIS), sponsored by the Department of Transportation and Communication (DOTC) and funded by the Japan International Cooperation Agency (JICA). Completed in March 1999, the MMUTIS study defines a Master Plan to 2015 and a Medium-Term Transport Development Plan from 1999 to 2004. MMURTRIP is one of the projects recommended in the Medium-Term Transport Development Plan. The MMDA is the lead agency tasked to coordinate and monitor the implementation of the recommendations of the MMUTIS. The need to realize the underutilized asset of the railway (Philippines National Railways). Rail corridors extend throughout Metro Manila and have significant potential to address the area's congestion problems. However, these assets are underutilized, and the performance of the Philippines National Railways is inadequate to serve the needs. The need to preserve this asset is critical to develop sustainable commuter rail operations both in the north and south of Metro Manila. The Government is pursuing possible privatization and concession options with the support of United States Technical Development Assistance and the Asian Development Bank, however little progress has been made. Coordination of activities in the Urban Transport Sector. In the Urban Transport Sector in Metro Manila there are several ongoing activities with support from several local sources, foreign donor sources, and the private sector financing support. Initially the Metro Manila Urban Transportation Integration Study (MMUTIS) was undertaken under the lead of a Govemment interagency steering committee and with funding from Japan Intemational Cooperation Agency. This study had been adopted and all prograrns are in line with the proposals set forward in this study and include the Light Rail Line 3 currently under construction under Japanese Bank for International Cooperation (JBIC) funding support, the Light Rail Line 2 which was opened in December 2000 under private sector consortium funding, several fly-overs under JBIC funding. The MMURTRIP project provides complementary infrastructure to these mega projects as recommended in the MMUTIS study. As an example the MMUJRTRIP project will provide road based interchange facilities at the last station on the Light Rail Line 3. The Government has also implemented an upgrade of traffic signals with a SCATS system under Australian aid financing. The NMIVURTRIP project will finance further such signals linked into the current system to expand coverage. The Urban Air Quality Management Strategy in Asia - Metro Manila Report (URBAIR) study was undertaken with funding from the World Bank and the recommendations of the study were used to develop the ongoing Metro Manila Air Quality Improvement Sector Development Program with funding support from the Asian Development Bank. The GEF component of MMURTRIP will addresss global emissions which are not covered by this Air Quality Program. 3. Sector issues to be addressed by the project and strategic choices: Among the various sector issues, the MMURTRIP project will address: The need for traffic management by improving jeepney, bus, and light rail transit interchange on the LRT Lines 2 and 3 corridors and at the interchanges on the South Super Highway. The need for enhanced access from outer areas by implementing a series of projects on the key accesses to the Marikina Valley situated to the east of Metro Manila. The need for an improved road network hierarchy by investing in strategic secondary roads. The need to address air pollution by means of a nonmotorized transport component that will test and -9-  demonstrate the benefits of pedestrian and bicycle facilities in selected areas. The need for implementation of an urban transport strategy in Metro Manila by developing the capacity of the Metropolitan Manila Development Authority (MMDA) in the area of traffic management. Developed by an interagency committee led and chaired by the MMDA, the MMURTRIP project has been a vehicle to allow the MMDA to undertake its mandated role as the metropolitan transport planning agency. To further develop this capacity and to allow the MMDA to maintain its strategic role in the development of the project and other related activities, the Government is strongly committed to the role of the MMDA in project implementation, including planning and coordinating strategic metrowide investments and formulating and implementing strategic traffic management and enforcement measures. A stronger, well-equipped MMDA would enhance the effectiveness of the present project and in turn further strengthen the role of the MMDA in Metro Manila. The MMDA has little experience in managing implementation of works contracts. The project will give the MMDA the opportunity to develop this capacity. Such an authority should have the role of implementing traffic management works. The strategic choices made in MMURTRIP's development include a focus on: * Including the MMDA as an implementing agency. * Complementing the ongoing Metro Manila Air Quality Improvement Sector Development Program and not repeating efforts underway in that project. Issues related to local air pollution and the railways are not addressed under MMIJRTRIP, since these are being addressed by projects with the financial assistance of other donors. * Corridors that carry the heaviest traffic and public transport passengers. * Interventions that complement the committed megaprojects rather than implementing further major investments. * Project components that encourage public transport. * Development of improved access to Metro Manila from the outer areas. * Project components that minimize resetflement and land acquisition. All components that involved major resettlement were removed at the project concept stage. The two remaining components involving land acquisition are the Marikina Bridge and Access Road component and the Don Mariano Marcos Avenue Extension component. * Limiting the nonmotorised transport component to one city for a demonstration effect. Since political commitment is the key to the success of such initiatives, the component was pursued on the basis of a proposal from the Department of Public Works and Highways (DPWH) and the Urban Roads Project Office (URPO), as well as a subsequent direct request from the Mayor of the City of Marikina. The nonmotorized transport component was not promoted by the World Bank, but rather initiated by the parties in the country themselves. While a barrier to such implementation exists at the country level, local support is being tapped to address this barrier. The proposal has been endorsed and confirmed as a national priority for GEF assistance by the GEF Focal Point in the Department of Environment and Natural Resources of the Philippines. C. Project Description Summary 1. Project components (see Annex 2 for a detailed description and Annex 3 for a detailed cost breakdown): The Metro Manila Urban Transport Integration Project (MMURTRIP) project includes the following components in the 12 cities and 5 municipalities making up the Metro Manila area: - 1 0 -  A. Traffic Management Improvements on the Light Rail Transport (LRT) Line 2 corridor; the EDSA (Epifanio de los Santos Avenue)-LRT Line 3 corridor; and the Bicutan and Alabang interchange on the southern corridor. Project components include public transport improvements such as integration of modes; improvement of interchange facilities and measures to introduce public transport priority; traffic management both at and between intersections; measures to control inappropriate frontage activity; measures to improve road safety for pedestrians by providing sidewalks, pedestrianized areas, and traffic calming; and provision of bicycle access and pedicab bicycle parking at stations. B. Marikina, Rizal, Pasig (MARIPAS) Access Improvements in the Marikina Valley, including the Marikina Bridge and Access Road component and the Marcos Highway and Ortigas Avenue Extension. C. A Secondary Roads Program for 15 road sections (listed in annex 2), including pavement rehabilitation, drainage and sidewalk improvements, traffic management, and construction of missing links for comprehensive corridor treatment so that secondary roads can fulfill their function on the road hierarchy. D. Nonmotorized Transport in the City of Marikina in Metro Manila under Global Environment Facility funding. E. Institution Building/Technical Assistance to establish and strengthen institutions responsible for future urban transport management in Metro Manila. The institution building component will strengthen the capacity of the Metropolitan Manila Development Authority (MMDA) to effectively carry out the traffic engineering and management responsibilities it was given under the MMDA Act. The MMURTRIP project will complement the assistance extended under the Metro Manila Air Quality Improvement Sector Development Program by supporting a capacity building program for 2001 to 2005. The MMDA, in consultation with the DPWH, has developed a year-by-year institutional plan including a description of its expanding functions and staffing requirements. Components A, B and C include the installation of traffic signals. A total of 75 intersections will receive new signals or an upgraded system which will link into the recently installed SCATS system. The design of the project components addresses the desire of the Local Government Units to install signage, provide street lighting along the LRT corridors, and introduce their respective city motifs in the beautification and design of sidewalks and medians. Project components include the greening and landscaping plans of the MMDA, the Local Govemment Units, and the Metro Manila Green Ladies (spouses of the 17 Metro Manila mayors). These components aim to improve the urban environment in the heavily trafficked areas to make them more user friendly for pedestrians and public transport users. As 22 percent of car journeys and 32 percent ofjeepneyjoumeys are less than 2 kilometers long, a better urban environment and walking areas might persuade people to walk rather than drive or take transport. These short trips, many of them on the main arterial network, are considered a major contributor to local traffic congestion (MMURTRIP Feasibility Study, 1997). - 11 -  Inidicative Bank %of GE Wof Component S.ctor Cost* ; of financing Ba filfl GEF .Sm) : Tta l ln {UM) financing (US$M) 9 c A. Traffic Management Urban Transport 0.0 0.0 0.00 0.0 Improvements LRT Line 2 Corridor Urban Transport 5.50 5.6 4.00 6.5 0.00 0.0 EDSA-LRT Line 3 Urban Transport 5.70 5.8 3.90 6.3 0.00 0.0 Corridor Southern Corridor-Bicutan Urban Transport 0.60 0.6 0.50 0.8 0.00 0.0 Interchange Improvements Southern Corridor-Alabang Urban Transport 1.70 1.7 1.30 2.1 0.00 0.0 Interchange Improvements B. MARIPAS Access Urban Transport 0.0 0.0 0.00 0.0 Improvements Marikina Bridge and Urban Transport 23.30 23.9 11.20 18.1 0.00 0.0 Access Road Marcos Highway Urban Transport 19.70 20.2 13.90 22.5 0.00 0.0 Ortigas Avenue Extension Urban Transport 5.20 5.3 4.40 7.1 0.00 0.0 C. Secondary Roads 32.70 33.5 19.20 31.0 0.00 0.0 D. Nonmotorized Transport Urban Transport 1.50 1.5 0.00 0.0 1.30 100.0 (NMT) E. Institution Institutional 1.10 1.1 1.0 1.6 0.00 0.0 Building/Technical Assistance Development . Total Project Costs 97.00 99.4 59.40 96.0 1.30 100.0 Front-end fee ___ 0.60 0.6 0.60 1.0 0.00 0.0 Total Financing Required 97.60 100.0 60.00 96.9 1.30 100.0 Note: Discrepancies in project costs are the result of figures being rounded. The cost of detailed engineering design, supervision, Project Management Office engineering overhead, and advisory services is included in the cost of each component la. Description of the Global Environment Facility (GEF) supported component: Global Environment Facility (GEF) grant funding will support the design and implementation of a system of bikeways and related facilities designated for the Nonmotorized Transport component in the City of Marikina, one of the cities of Metro Manila. This incremental component of the overall MiMURTRIP project will demonstrate the benefits of this alternative mode of transport. Nonmotorized transport here includes bicycle lanes for both bicycles and pedicabs (nonmotorized passenger transport) and facilities for walking trips. The Nonmotorized Transport component will include the following: * A network of about 66 kilometers of bikeways of which 50 kilometers will be developed along existing roads and 16 kilometers of bikeways along the Marikina River banks. The network will connect the residential areas with the main trip attractors (factories, schools, hospitals, market areas and shopping malls) and public transport terminals including the new LRT Line 3 stations. * Traffic calming and pedestrianization measures and facilities around schools and market areas and provision of bicycle parking facilities. * Street lighting where necessary to ensure safety after hours. * Training and Capacity Building for the staff of the Marikina Bikeways Program Office, with particular focus on planning capacity and monitoring and evaluation activities. * Education and public awareness carnpaigns targeted to potential users as well as car users and - 12 -  city's traffic management/enforcement personnel. * Replication campaigns targeted to neighboring Municipalities and other cities that are suitable for bikeway development. 2. Key policy and institutional reforms supported by the project: A central theme of the project is the need to coordinate relevant institutional roles and physically integrate various modes. With this view, the project will demonstrate the role of Government and the importance of complementary investments in enhancing the full potential of public or private investments. Recognizing that metropolitan governance is critical for Metro Manila, the project will strengthen local government functions and serve as a vehicle to allow the Metropolitan Manila Development Authority (MMDA) to play its mandated role by addressing the sector issues listed above. The MMi4DA is the metropolitan authority for the 17 Local Government Units of the Metro Manila area. During the project preparation phase, coordination was initiated among the key agencies of the DPWH, the DOTC, the MMDA and the National Economic and Development Authority (NEDA), with the MMDA chairing the project development commnittee. Although the coordination mechanism was maintained over the preparation period, the effectiveness of the MMDA needs further strengthening. The MMIRTRIP project will address this need through institution building and charging the MMDA with the ultimate responsibility for implementing civil works contracts. In addition, policy changes in the road sector and the DPWH as a whole are being pursued through the parallel World Bank funding assistance of the First National Roads Improvement and Management Project (NRIMP-1), which will help the Government of the Philippines in commercializing the road sector and separate road sector-specific policymaking and regulation from operations. The NRIMP-1 project, effective March 2000, will also help the DPWH build capacity and develop its operations, including procurement and financial management systems, as well as provide support to the Environmental Impact Assessment Project Office (EIAPO). These actions will further support the implementation of the MMURTRIP project. Physical integration of various modes is most clearly demonstrated in the recently opened LRT Line 3, developed under private sector financing arrangements. The MMURTRIP project will develop the complementary access infrastructure, such as pedestrianized areas and interchange for jeepney and LRT passengers. Moreover, the project stresses the importance of traffic management measures as a cost-effective way to reduce congestion. 3. Benefits and target population: Travel time savings. The project's major quantified benefit would be travel time savings as a result of the proposed interventions (see para. El). For example, on the LRT Line 2 corridor, the overall travel speed on Aurora Boulevard/R. Magsaysay Boulevard would rise from the present average of about 8 kilometers an hour to 13 kilometers an hour. Similarly, on the EDSA-Line 3 corridor (one of the busiest bus corridors in the world) the total delay for buses that pass through all intersections between North Avenue and Roxas Boulevard would be 15 minutes once the proposed measures are in place. This is an overall improvement in bus journey times of around 35 percent. Vehicle operating cost savings have also been quantified. (Source: MMUTRIP Feasibility Study, 1998) Improved urban environment. A major unquantified benefit of the project will be an improved urban environment and increased safety. The LRT schemes will generate considerable access/egress at the - 13-  stations. But inadequate facilities will expose pedestrians to road traffic, causing a safety hazard and disrupting road traffic. The project will provide facilities to safeguard pedestrians in and around these stations. Public transport users. The project is targeted at public transport users, many of whom are poor "captive" users. Although almost all households use public transport in some form, the lower-income groups primarily use buses and jeepneys. Based on the 1996 MMUTIS Study, for example, people with household income under PhP3,000 per month (US$100, or US$1,200 per year) make 85 percent of total trips by public transport. People with household income of PhP40,000 to PhP50,000 per month (US$1,333 to 1,667, or US$ 16,000 to 20,000 per year) make fewer than 50 percent of trips by public transport. These numbers indicate the strong link between poverty and public transport use in Metro Manila. While there is a growing concentration of wealth in Metro Manila, with the average household income estimated at PhP1 73,600, a little over twice the national average, 31 percent of the population in Metro Manila live below the poverty line of PhP1 1,230 per capita per year (US$1,826 per household per year). The 1997 Traffic Survey indicates that "Socio-economic class is a very significant factor in differentiating the conunuting experience. Among ABC Metro Manilans, or the rniddle class and up, 62% use their own vehicle for commuting to work and only 38% use public transportation. Those who take public transportation for going to work, are 86% among Class D, and 82% among Class E." (Social Weather Station, Bulletin 97-22). Lower income groups. A significant impact of the project will be access improvements for the Marikina Valley (MARIPAS area), where the average family income is lower than that in the central parts of Metro Manila. Only one of the 17 M TUTIS traffic zones in the Marikina Valley has an average household income higher than the Metro Manila average of PhP 13,968 per month, and ten of the 17 zones have an average household income of less than PhP10,000 per month (US$340, or US$4,000 per year). In central Metro Manila lower-income groups and squatters are not concentrated in any particular geographic area but rather spread throughout the city. Therefore, project components could not be geographically targeted in these areas. Pedestrians. Space for pedestrians will make it possible for people to switch short-distance trips to walking trips, potentially reducing motorized congestion, and allow safe access to employment and other facilities for the large percentage of the poor who walk. 3a. Global benefits of the GEF supported component: The direct benefits of the Nonmotorized Transport component will be less motorized traffic and congestion and the consequent decrease in emissions of greenhouse gases and other pollutants relative to the situation without the project. This reduction is estimated at more than 30,000 tons of carbon dioxide equivalent per year (see Annex 13 for a detailed quantitative analysis of direct benefits). An indirect benefit of no less value will be a demonstration of the advantages and viability of bicycle and nonmotorized transport so that similar facilities might be adopted/developed elsewhere in Metro Manila and in the Philippines. The benefits of this form of transport (sustainability, lack of pollution, low cost, good altemative for commuting) may thus be realized over a wider area. 4. Institutional and implementation arrangements: Implementation period. Five years, from September 2001 to September 2006. Project concept development. The project has been developed and agreed by an interagency steering - 14 -  committee led and chaired by the Metropolitan Manila Development Authority (MMDA), and endorsed by the Council of Mayors' of Metro Manila, also under the chairmanship of the MMDA. The interagency steering committee was co-chaired by the Department of Public Works and Highways (DPWH) which has been designated as the overall executing agency for the project. Project implementation. There are three implementing agencies for the project. Each will undertake its own procurement and award of contracts, have its own financial management, have its own special account, produce its own Project Management Reports (PMRs), and monitor the impact of its own components against defined monitoring criteria. Each will procure its own consultant services for construction supervision and for advisory services related to these components. The three implementing agencies are: * The Department of Public Works and Highways (DPWH)-Urban Roads Project Office (URPO) is responsible for the MARIPAS Access Improvements components and for 10 of the Secondary Roads Program components. Established in 1973 as a special projects office, the URPO has extensive project implementation experience. It also has a good understanding of World Bank-funded projects, having been involved in such Bank-assisted projects as the Metro Manila Urban Transport Strategy Planning Project (MMUSTRAP) and Metro Manila Urban Transportation Project (MUTP) phase 1. The DPWIH-Traffic Engineering Center (TEC) is responsible for the traffic signals package to be applied to most project components. * The Metropolitan Manila Development Authority (MMDA) is responsible for the Traffic Management Improvements components, for five of the Secondary Roads Program components, and for the Institution Building component. A project implementation team headed by the Assistant General Manager for Operations will manage the implementation of the components and coordinate the procurement of works, goods, and services to be undertaken by existing units of the MMDA. * The City of Marikina is responsible for the Nonmotorised Transport component. The City is one of the 17 Local Government Units of the Metro Manila area and an autonomous unit headed by a democratically elected mayor. The City has established a Bikeways Program Office (BPO), which will be part of the City Administrator's Office. The BPO will be in charge of coordinating the implementation and the monitoring of the program. In particular, it will coordinate with the relevant departments of the City, with the NGOs and with the other stakeholders. The BPO will also be responsible for the monitoring and evaluation activities. The evaluation activities in particular will focus on the project as well as on the methodology applied to estimate the benefits derived from the resulting savings in greenhouse gas emissions. A five-year plan for the development of the bikeways is also part of the responsibilities of the BPO. Participating Local Govemment Units (LGUs) have created local project implementation and monitoring teams under the coordination of the MMDA project implementation team. These LGU teams have been active in detailed engineering and in mobilizing public participation in their constituencies. The teams will be responsible for field supervision and monitoring of the Secondary Roads Program components. Project execution. The DPWH will assume the role of overall executing agency for the project, through its Urban Roads Project Office (URPO). DPWH will monitor works and activities to be undertaken by the DPWH, MMDA and the City of Marikina (figure C. 1). The DPWH will report quarterly to the steering committee on the progress of works. A memorandum of agreement has been signed between the DPWH, MMDA, and the City of Marikina outlining their various responsibilities. - 15 -  Figure C.1 VMM'URTRIP project implementation structure l~~~~ ~oa Goenenlnt IDPWH SecretrI Steering Comoiittee MMDA (chairs), D (chair),DPWH (co-chair), DPWH - Urban DOTC, NEDA, DBM, Roads Project Of fice NCTS, Marikina (UTRPO) Executing Agency noTraffic Engineering Centert Proj O | i t LocalGovet nmentUnits c l LGUsl Monitoring. The interagency steering committee will monitor and direct the project during project implementasion. The relevant Metro Manila LGUs will be invited to join this advisory committee. The interagency steering cornmiittee consists of representatives from the MMDA (chair), the DPWH (co-chair), the Departmnent of Transportation and Conununications (DOTC), the National Economic and Development Authonty (NEDA), the Department of Budget and Management (DBM), the Nabional Center for rransportaiion Studies (NCTS) and the City of Maikina. The comjlittee shall meet at least quarterly to discuss and resolve implementation issues and conceins. .nvironment. The Enviroi n ent Impact Assessment Project Office (EeO) in the DPWH has undertaken the Environmental Assessment and documentation for the MMURTRIP and has secured the clearances for the project from the Departwent of Enviroinnent and Natural Resources (DENR). The EIAPO will be responsible for monitoring project compliance with the envirodnental assessment for all project components. The unit has the capacity to undertake such work and has been strengthened under the First National Roads Impnflicted alw othereimProvject (NRIMP-1) supported by the World Bank. Project ofplementation plan. The DPWH and tiMDA jointly prepared the project implementation plan of May 2001 (see project files), which will be used to guide the implementation. D. Project Rationale 1. Project alternatives considered and reasons for rejection: To combat the rapidly growing imbalance between transport capacity and demand, the Gove2ment of the Philippines has embarked on building several light rail lines and expressways, mostly with fnancing from private developers. Although only three of these megaprojects are under imnplementation, from the outset they have conflicted physically with other irmprovements undertaken by sector agencies, namely the Departmnent of Transportation and Cormmunicafions (DOTC), the Department of Public Works and Highways (DPWVH), and private sponsors. Specifically, the megaprojects have paid lirnited attention to: *Transfers between Light Rail Transit (LRT) Lines I and 2 and Lines 2 and 3. *The need for LRT terminals as major transfer stations between LRT and bus, jeepney, and tricycle - 16 -  services. * Safe and efficient access and egress at LRT stations. * Safe and efficient access and egress at expressway interchange points. * Better general traffic flow along major corridors to improve the efficiency of bus, jeepney, and other traffic. The Metro Manila Urban Transport Integration Project (MMURTRIP) will address the above issues by developing measures to complement the megaprojects so as to ensure maximum benefit and better service for the traveling public. An alternative option, financing further megaprojects, was rejected because other donors, particularly the Japanese Bank for International Cooperation, are investing in such projects, and their continued sole application is not considered a long-term solution without complementary measures. In addition, the almost impossible task of implementing resettlement and land acquisition in Metro Manila eliminated components that require major construction. The use of an adaptable program lending (APL) facility was not considered to offer any advantages over a specific investment loan (SIL). la. Alternative GEF supported components considered and reasons for rejection: In the framework of the MMURTRIP, other possible components that could have received GEF support would have been a system of emissions control for both private and public transportation modes in the entire metropolitan area and a strategy to promote and introduce cleaner fuel and improved engine technology. The Government of the Philippines is already promoting initiatives in emissions control with the support of a US$300 million program loan from the Asia Development Bank. The second more technically complex possible component of cleaner fuel, improved engine technology, and emissions control would have required an extensive preparation period, thus affecting the timetable of the whole MMURTRIP. Therefore it was decided to focus on a simpler component, which is innovative in the Philippines and in Asian and is potentially more rewarding, particularly in terms of changing the approach to transportation policy and travel behavior. 2. Major related projects financed by the Bank and/or other development agencies (completed, ongoing and planned). = _ Latest Supervision Sector Issue Project (PSR) Ratings (Bank-financed proiects only) Implementation Development Bank-financed Progress (IP) Objective (DO) The need for management systems in First National Roads S S the DPWH for effective management of Improvement and Management the national roads network Project (NRIMP-1): US$150 million Private participation in infrastructure IFC/MIGA-Manila North development Tollways Corporation-North Luzon Expressway: IFC loan of up to US$46 million. - 17-  IFC-Philippines International Air Terminals Company, Loan of up to $150 million to construct, operate and maintain a new international passenger terminal, Terminal III, at the Ninoy Aquino Intemational Airport (NAIA) in Manila. Other development agencies Urban air pollution and the harmful Metro Manila Air Quality effects of mobile source air pollution Improvement Sector Development Program: US$300 million from the Asian Development Bank Replacement of poorly functioning SMART signal project: traffic control system Australian Aid Grant Lack of an urban transport strategy MMUTIS transport study: JICA Imbalance between transport capacity LRT Line 2 development: and demand JBIC Private participation in infrastructure LRT Line 3 development: development Private financing IPIDO Ratings: HS (Highly Satisfactory), S (Satisfactory), U (Unsatisfactory), HU (Highly Unsatisfactory) 3. Lessons learned and reflected in the project design: During the past decade, the World Bank has not provided any funding support in the Metro Manila urban transport sector. Projects funded by other agencies have indicated the difficulties of resettlement in Metro Manila. The components of this project have therefore sought to minimize the need for resettlement, and several projects components which would have involved resettlement have been deleted from the original project proposal. The World Bank has experience with urban transport projects throughout the world. Several of these projects have demonstrated the benefits of traffic management in improving urban congestion, including high rates of return. An Urban Transport Improvement Project that started in November 1998 in Vietnam consists solely of traffic management interventions. 3a. Lessons learned and reflected in the GEF-supported component design: The experience of cities in Japan, the Netherlands, Germany, and several other European and Latin American nations demonstrates that modernizing urban transportation requires not total motorization but the appropriate integration of walking, nonmotorized transport, and motorized transport. People in these cities make most of their trips on foot or by bicycle. Nonmotorized transport could also play an important role in the urban transportation system of Metro Manila in the coming decades. However, the future of nonmotorized transport in Manila and in many Asian cities is threatened by growing motorization, loss of street space for safe nonmotorized vehicle use, and changes in urban form prompted by motorization with major negative effects on air pollution, energy use, urban sprawl, and the employment and mobility of low-income people. - 18-  4. Indications of borrower and recipient commitment and ownership: The MMU.RTRIP project was first proposed in 1997 by an interagency steering committee chaired by the Metropolitan Manila Development Authority (MMDA) and including the MMDA, DPWH, DOTC, DOF and NEDA. Subsequent workshops of this committee and consultations with Metro Manila Local Government Units developed a list of investments that now form the key components of the project. A feasibility study was completed with Policy and Human Resources Development (PHIRD) grant funding and an initial project proposal was presented to the Investment Coordination Committee (ICC) of the NEDA Board in July 1998. The ICC endorsed a detailed project proposal in August 1999, subject to the more direct involvement of the MMDA. Subsequent proposals for the involvement of the MMDA have been endorsed. Political commitment to the project is strong, particularly in support of the development and involvement of the MMDA. The ICC approved the project on March 28, 2000. The DPWH included the MMURTRIP project in its three-year rolling priority investment program for 1999-2001. The Local Governments Units of Marikina, Rizal, and Pasig, in an association called MARIPAS, drew up a plan with the DPWH regional office to tackle their comrnon transport problems. The MMURTRIP project will implement the Marikina Bridge and Access Road, Marcos Highway, and Ortigas Avenue Extension components of this plan. 4a. Indications of recipient commitment and ownership of the GEF supported component: The Nonmotorized Transport component of MMURTRIP was proposed by the Department of Public Works, Urban Roads Project Office and subsequently endorsed by the mayor of the City of Marikina in a request to the World Bank for GEF funding support for this incremental cost. The City of Marikina administration demonstrates exceptional comrnitment to nonmotorized transport and related environmental improvements. It has funded preliminary diagnostic work on the component and set up a counterpart team composed of staff of the various city offices (Settlement, Health, Engineering, Administration). This team will be responsible for liaison and coordination among the various adrministrative units and with the consultants and contractors. To inform the public of the design process and implementation of the Nonmotorized Transport component of the project, focus group discussions have been held wNith stakeholders from the communities and businesses that will be affected by the component. The discussions have confirmed strong support for the use of bicycles and the need for appropriate facilities. The local newspaper has published an article on the so-called Marikina Bicycle Network. The information campaign that is envisaged as part of the component, as well as continued promotion and awareness building, will help maintain momentum. 5. Value added of Bank and Global support in this project: The value added of World Bank support has been to stTess the importance of multimodalism, traffic management, and supporting institutional arrangements at the metropolitan level, at a stage when the government had committed to several megaprojects and the transport sector regularly confronted poor traffic management, fragmented institutions, and physical conflicts between rail and highway projects and privately and publicly funded projects. The World Bank has supported urban transport projects in many large cities of developing countries. The Operations Evaluation Department (OED) of the World Bank, recommends in its Country Assistance Review that the World Bank remain active in the transport sector because of the sector's important strategic role, institutional weaknesses, and need for public investment, as well as the considerable experience of the World Bank in transport. The value of global support in this project lies in supporting an innovative incremental project component that otherwise would likely not find - 19 -  funding. E. Summary Project Analysis (Detailed assessments are in the project file, see Annex 8) 1. Economic (see Annex 4): * Cost benefit NPV=US$ 1063 million; ERR = 137 % (see Annex 4) O Cost effectiveness O Incremental Cost O Other (specify) Methodology. The economic evaluation of the components was carried out using a standard cost-benefit analysis with a 15 percent discount rate. In accordance with standard practice in evaluating transport projects, the benefits are derived from vehicle operating cost (VOC) savings and from value of time (VOT) savings. The benefits arising from accident cost savings have not been included because of the difficulty of this type of calculation. However, improved safety will result from fewer potential conflicts between vehicles and pedestrians, and will lead to more benefits. The costs of the project include initial construction costs, right-of-way acquisition costs, and future maintenance costs. Benefits. The greatest benefits of the project are derived from VOT savings, with relatively fewer benefits from VOC savings. The VOT savings include the valuation of work travel time, commuting travel time, and leisure travel time. Comnuting and leisure time has been valued at 50 percent of work time. Assigning a value to leisure travel time is in line with World Bank practice in evaluating urban transport projects. Local evidence indicates that the seemingly high value of 50 percent (the usual average is 25-30 percent of work time) is not unwarranted in the Manila context. The value of work time ranges from PhP41 to 52 per hour (at 1997 prices of US$1 = 29.4 PhP, US$1.39-$1.76 per hour) and is based on Metro Manila Urban Transportation Improvement Study (MMUTIS) 1996 household interview survey data. Assumptions. The analysis assumes a 5-year life span for traffic management improvements, mainly on Light Rail Transport (LRT) Line 2 and EDSA, and a 20-year life span for the more substantial components. The assumed traffic growth rate of 2 percent within and along the EDSA corridor and 5 percent outside the EDSA corridor reflects the current situation, population growth differentials, and network capacity constraints. Results. The results of the analysis (Table E. 1) show high returns. World Bank experience with similar traffic management projects in other countries shows that such projects consistently produce high returns because of their significant benefits, such as improvements generated with relatively small investments. - 20 -  Table E.1 Econonic evaluation summary Component Cost Cost Length EIRR EIRR NPV (15%) (milions (millions (km) (VOC) (VOC/ (PhP) of US$) of PhP) (VOC) (oT) A. Traffic management improvement LRT Line 2 Corridor 5.5 275 12 64 142 980.8 EDSA-LRT Line 3 Corridor 5.7 285 18 18 155 1,025.8 Bicutan Interchange 0.6 30 n/a 37 192 489.6 Alabang Interchange 1.7 85 n/a 56 119 407.5 B. MARIPAS Access Improvements Marikina Bridge and Access Road 23.3 1165 n/a 4 19 808.8 Marcos Highway 19.7 985 4.6 22 162 5,575.6 Ortigas Avenue Extension 5.2 260 6.8 133 565 7,485.7 C. Secondary Roads Program 32.7 1634 69.1 52 133 36,400.8 Project total 94.4 4720 37 137 53,145 a Economic Internal Rate of Return. * n/a=not applicable. Note:Se ction length is not so relevant in certain sections because works are concentrated at points. For example, the traffic management improvements are largely at LRT stations, and the Bicutan and Alabang Interchange improvements are concentrated at the interchange. EIRR was calculated excluding taxes. 1-A. GEF supported component (see annex 14): A GEF Project Development Fund Block A Grant partly financed a pre-feasibility study to determine the economic viability of the project. The preliminary results of the study and the data collected were used as input for a simple incremental cost analysis (see annex 14). This analysis focuses on the cost of achieving the main global benefits (reduced greenhouse gas emissions) by implementing the Nonmotorised Transport component (the GHG case) compared with a baseline case in which the component is not implemented. 2. Financial (see Annex 4 and Annex 5): NPV=US$ million; FRR = % (see Annex 4) No financial evaluations of the components were carried out since this is not appropriate for the project. Fiscal Impact: Both the Department of Public Works and Highways (DPWH:) and the Metropolitan Manila Development Authority (MMDA) are national government agencies. The DPWH was organized and established through Executive Order 124 (1987), and the MMDA through Republic Act 7924 of 1995. Both agencies receive project funds through the annual budget allocations. Funds are not on-lent to these agencies. The Department of Budget and Management (DBM) included provision for the MMURTRIP project in the DPWH budget allocation for the fiscal year 2001. The project is included in the 3-year rolling budget cycle of the agencies, as required by the DBM. The full project cost (that is, both the Government of the Philippines part and the Loan proceeds) is included in the Forward Obligational Authority (FOA) issued by the DBM (FOA No. E-01 -002-3 dated 10 May 2001) which indicates the amount that will be proposed by the President of the Republic to the Philippine Congress to cover the total Loan proceeds and peso counterpart required by MMURTRIP. About PhP 187.0 million (US$ 3.7 million) is assigned for DPWH - 21 -  for MMURTRIP for 2001. For 2002, PhP362.2 million (US$7.2 million) is proposed by DPWH and PhP 273.0 million (US$5.5 million) by MMDA for MMURTRIP (table E.2). Table E.2 Project budget for 2001 and 2002 Agency 2001 2002 PhP million US$ million PhP million US$ million DPWH Total agency 34,700.0 694.0 46,000.0 852.0 MMURTRIP 187.0 3.70 362.2 7.2 MMDA Total agency 1,719.0 34.4 3,432.0 68.7 of which National gov't. subsidy 639.5 12.8 1,616.0 32.3 MMURTRIP - - 273.0 5.5 Notes: Budget for 2001 is the re-enacted 2000 budget. Budget for 2002 to be confirmed when budget is approved by Congress in April 2002. Exchange rate used is US$1=PhP50. Source: Department of Budget and Management. 3. Technical: A feasibility study on all project components was completed in July 1998 under Policy and Human Resources Development (PHRD) grant funding from the Japanese Government. The detailed engineering for half the project components is complete. The detailed engineering for the remaining project components will begin in October 2001. The project aims to demonstrate the cost-effectiveness of traffic management measures to reduce congestion. Little of this approach has been used to date in Metro Manila, where most investments have been on megaprojects. Traffic management is a recognized tool in urban transport for maximizing the efficiency of existing road space and is suitable where the scope for expanding road space is limited due to cost and environental concerns. A road safety audit is included for all project components. 4. Institutional: 4.1 Executing agencies: The Department of Public Works and Highways (DPWH) is the designated executing agency and will be responsible for reporting to the World Bank and to the project steering committee. The DPWH-Urban Roads Project Office (URPO) will implement about 77 percent, the MMDA will implement about 23 percent, and the City of Marikina will implement about 2 percent of the value of civil works. The DPWH- Traffic Engineering Centre (TEC) is responsible for the signals equipment package. The project is implemented by existing structures of the agencies. No special offices have been set up for the project. 4.2 Project management: The Director of the DPWH-URPO, under the Undersecretary for Operations of the DPWH, will be responsible for managing the DPWH components. The Assistant General Manager for Operations, under the General Manager of the MMDA, will be responsible for managing the MMDA components. Both the DPWH-URPO and the MMDA will be assisted by a project advisor (funded by the project) who will report to the director of the DPWH-URPO and of the MMDA. 4.3 Procurement issues: World Bank staff undertook a procurement assessment (see project file) of the DPWH-URPO, the MMDA - 22 -  and the City of Marikina as the implementing agencies. The assessment was fully discussed and agreed with the agencies in May 2000. The DPWH-URPO prepared a Microsoft Project procurement implementation schedule (see project file) for the whole project. Overall risk assessment: Average Risk category (see annex 6). 4.4 Financial management issues: World Bank staff undertook a financial management assessment (see project file) of the DPWH-URPO, the MMDA, and the City of Marikina as the implementing agencies. The assessment was fully discussed and agreed with the agencies in May 2000. Each implementing agency will have a special account for the components for which they are responsible. The overall financial management of the DPWH (and DPWH-URPO), the MMDA, and the City of Marikina satisfies the World Bank minimum financial management requirements. Project Management Report (PMR)-based reporting will be implemented. However, PMR-based disbursement is targeted at a later stage in the project execution to coincide with the improvement of financial management for DPWH as a whole under the assistance of the NRIMP project. (see Annex 6). 5. Environmental: Environmental Category: B (Partial Assessment) 5.1 Summarize the steps undertaken for environmental assessment and EMP preparation (including consultation and disclosure) and the significant issues and their treatment emerging from this analysis. The project is rated category B since there is limited resettlement and land acquisition and since the project is not expected to have negative environmental impacts. Rather the project aims to: * Improve the urban environment for pedestrians and public transport users. * Improve public transport service ancillary facilities, which would have a positive impact on the environment. * Include landscaping and greening programs. DPWH Order No 15, Series of 2000 requires Tree Planting along National Roads. This will be included in all project corridors. All project components comply with all environmental clearance requirements of the Government of the Philippines and World Bank Operational Policy OP 4.01 on Environmental Assessment. The Environmental Impact Assessment Project Office (EIAPO) of the DPWH, in conjunction with an independent environmental consultant, has produced an Environmental Assessment report covering each project component. The Government of Philippines Department of Environment and Natural Resources (DENR) has cleared all project components by either issuing Certificates of NonCoverage or Environmental Compliance Certificates as applicable. The Environmental Assessment (see project file) was disclosed in the World Bank Infoshop, the World Bank Office in Manila Public Information Center, and publicly in-country by the DPWH and local newspapers on August 14, 2000. The World Bank requested supplemental information on air and noise impacts for two project components, namely the Marikina Bridge and Access Road component and the Marcos Highway component. The DPWH has undertaken work on this and submitted draft reports to the World Bank. The reports are however still incomplete and the Government has agreed to complete the reports to the satisfaction of the World Bank and to adopt the recommendations as a condition of Loan Effectiveness. With regard to urban air quality and transport, the Metro Manila Air Quality Improvement Sector Development Program (refer to the Asian Development Bank Project Report of November 1998, RRP: PI 30480) is ongoing. Leaded gasoline was phased out in Metro Manila on April 1, 2000 in line with the Clean Air Act and as part of the ongoing work on the air quality project. The Air Quality project also promotes the use of cleaner fuels (particularly important for the jeepneys, which run on diesel and are a - 23 -  major cause of particulate pollution) and a vehicle inspection and anti-smoke-belching program. 5.2 What are the main features of the EMP and are they adequate? All construction contracts for the project components have appropriate clauses dealing with the short-term environmental impacts during construction. The supervision consultants are responsible for ensuring that the provisions of the DPWH with respect to environment are enforced on site. The supervision documents include appropriate clauses, and the supervision consultant includes a social/environment specialist in the team. 5.3 For Category A and B projects, timeline and status of EA: Date of receipt of final draft: July 31, 2000 5.4 How have stakeholders been consulted at the stage of (a) environmental screening and (b) draft EA report on the environmental impacts and proposed environment management plan? Describe mechanisms of consultation that were used and which groups were consulted? The Environmental Assessment and the two Resettlement Action Plans were announced in local newspapers on August 14, 2000. The institutional framework for the project has ensured the full involvement of Local Govemment Units in the development of the project. The DPW" developed a plan for stakeholder consultation, the Operational Framework for Public Participation and Consultation, DPWH, EIAPO, April 2001, for the MMURTRIP project. 5.5 What mechanisms have been established to monitor and evaluate the impact of the project on the environment? Do the indicators reflect the objectives and results of the EMP? The Environmental Impact Assessment Project Office (EIAPO) in the DPWH is mandated to monitor the environmental impacts of the project. In accordance with DPWH Department Order (DO) 220 of November 9, 1999, the EIAPO is mandated as the environmental service arm of the DPWH to provide environmental and social assessment support and to implement and oversee the Environmental Management Plan (EMP) for projects. The supervision consultants are also required to report on compliance with the EMP. 6. Social: 6.1 Summarize key social issues relevant to the project objectives, and specify the project's social development outcomes. Resettlement and Land Acquisition. All project components are identified and have had feasibility studies completed. Only two project components involve resettlement and land acquisition. A Resettlement Action Plan (RAP) for each (see project file) was disclosed in the World Bank Infoshop, World Bank Office in Manila Public Information Center, and publicly in-country by the DPWH and in local newspapers on August 14, 2000. The final versions have been disclosed in the InfoShop. The project components involving resettlement and land acquisition are: * The Marikina Bridge and Access Road component. The resettlement and land acquisition is documented in the Resettlement Action Plan (final version April 2001) and currently the resettlement of 56 Project Affected Families is being implemented and will be completed prior to commencement of works on this component under the project. * The Don Mariano Marcos Avenue Extension Secondary Roads component. This is currently a "missing link" in a road. This involves only land acquisition of one piece of land from one landowner of approximately 500 m X 38 m. No resettlement is involved as no parties live on the land. In accordance with the Resettlement Action Plan (final version October 2000) the land - 24 -  acquisition will be completed prior to commencement of works on this component. The component cost is PhP40 million (about US$1 million) and land acquisition about PhP 230 million (US$4.6 million). The Resettlement Action Plans comply with World Bank Operational Directive 4.30 on Involuntary Resettlement. The RAPs have been prepared in accordance with the comprehensive DPWH Policy Framework for Land Acquisition, Resettlement and Rehabilitation for MMURTRIP, April 2001, satisfactory to the World Bank and endorsed by DPWH prior to negotiations. The final version of the "Resettlement Policy" has been disclosed in the World Bank InfoShop. Any additional resettlement and land acquisition issues encountered during implementation of the MMURTRIP project will be dealt with in accordance with the above policy framework. 6.2 Participatory Approach: How are key stakeholders participating in the project? The development of the MARIPAS Access Improvements component has been based on consultations among the Local Government Units of Marikina, Rizal, and Pasig. These units have formed an association called MARIPAS and with the DPWH regional office have drawn up a plan to tackle their various common transport problems. Parts of this plan will be implemented under the project. The mayors and officials of the Local Government Units (LGUs) are key stakeholders in the project. The MMDA has played a key role in ensuring their participation. Each LGU has set up a counterpart team for the project. The Environmental Assessment documents the consultation meetings with local government officials. The LGUs have participated actively in the detailed designs of the project. Their common priorities are the installation of signage, street lighting along the LRT corridors, and use of their respective city motifs in the design and beautification of sidewalks and medians. The LGUs have consulted affected commercial and other establishments on the designs to ensure their acceptance before construction. The DPWH submitted the Environmental Assessment and the two Resettlement Action Plans for public review on August 14, 2000. The availability of the documents was announced in at least one local newspaper and one national newspaper. The DPWH requires at least two public meetings to invite comments and discussion from stakeholders and affected individuals. The DPWH developed a plan for stakeholder consultation, the Operational Framework for Public Participation and Consultation, DPWI-, EIAPO, April 2001, for the MMURTRIP project. 6.3 How does the project involve consultations or collaboration with NGOs or other civil society organizations? Each Local Govemment Unit is responsible for consultation with the affected members of the public and beneficiaries of the MMURTRIP project with the assistance of MMDA and EIAPO. The mayor of each LGU is democratically elected in a 3-year election cycle. Focus group discussions and user surveys were conducted for the Nonmotorized Transport component of the MMURTRIP project. These are documented separately in the Feasibility Study for the Marikina Bikeways Network. For the phase I project components, the LGUs are consulting regularly with civil society. Each Local Government Unit has a defined system of consultation and information dissemination. The consultative system of Quezon City, documented in the Environmental Assessment, is an example. The planning officer of Quezon City has developed clear guidelines for consultations including the following: * A community relations office to handle routine inquiries, with a staff member assigned as a full-time information officer to answer inquiries. Every Monday the Mayor's office sponsors a "People's Hour," a kind of open townhall meeting where the public can raise issues. * Information provided by the planning office routinely at no cost, or by a lending service that - 25 -  releases documents temporarily so that users can make copies. The planning office helps users find documents from other agencies that are not in their records. Some maps are also available on request. The project will follow the existing consultation systern It will expand this system when necessary beyond simple information dissemination to soliciting public feedback to improve the design process. 6.4 What institutional arrangements have been H .;,ided to ensure the project achieves its social development outcomes? The institutional arrangement (see Figure C. 1t ensures the direct involvement of the MMDA local government units in the project, thus serving ,3s a bridge between the national government agency, the DPWH, and the local level. This arrangemenit, strongly promoted by the National Economic and Development Authority (NEDA), has already shown benefits during project preparation and will ensure that the project achieves its social development outcomes by incorporating local needs. 6.5 How will the project monitor perfonnance in terms of social development outcomes? The Environmental Impact Assessment Project Office in the DPWH will monitor the social development outcomes of the project. 7. Safeguard Policies: 7.1 Do anY of the following safeguard policies apply to the project? Policy ApplicXbility Environmental Assessment (OP 4.01, BP 4.01, GP 4.01) * Yes 0 No Natural habitats (OP 4.04, BP 4.04, GP 4.04) 0 Yes 0 No Forestry (OP 4.36, GP 4.36) 0 Yes * No Pest Management (OP 4.09) 0 Yes 0 No Cultural Property (OPN 11.03) 0 Yes 0 No Indigenous Peoples (OD 4.20) 0 Yes 0 No Involuntary Resettlement (OD 4.30) _ * Yes 0 No Safety of Dams (OP 4.37, BP 4.37) 0 Yes * No Projects in International Waters (OP 7.50, BP 7.50, GP 7.50) 0 Yes 0 No Projects in Disputed Areas (OP 7.60, BP 7.60, GP 7.60) 0 Yes * No 7.2 Describe provisions made by the project to enstire compliance with applicable safeguard policies. The Environmental Impact Assessment Project Office in the DPWH will monitor compliance of the project with the Environmental Assessment Operational Policy and the Involuntary Resettlement Operational Directive. F. Sustainability and Risks 1. Sustainability: The project aims to demonstrate the effectiveness of traffic management measures, however, the sustainability of these measures will depend on the willingness and effectiveness of the Metropolitan Manila Development Authority (MMDA), Local Government Units (LGUs), and related agencies in enforcing traffic management measures. The effectiveness of the MMDA during and after project implementation is a critical risk for the sustainability of the project. To mitigate this risk, the MMDA's participation was ensured throughout the project preparation. The risk is weighed against the considerable benefits derived from the involvement of MMDA. - 26 -  2. Critical Risks (reflecting the failure of critical assumptions found in the fourth column of Annex 1): Risk Risk Rating Risk Mitigation Measure From Outputs to Objective Risk that the MMDA and related M The MMDA's participation was ensured responsible agencies and Local throughout project preparation. The MMDA is a Government Units of Metro Manila do direct participant in project implementation and not implement complementary traffic thus a key stakeholder that will have an inter,-sL enforcement measures such as control of in ensuring the project impact and its frontage activities, adherence to traffic sustainability. rules, proposed traffic circulation strategies, and general traffic management. Risk that the LGUs of Metro Manila do M The MMDA is a direct implementing agency of not continue to be consulted regularly, the project. Since MMDA is a "governing body' involved in project implementation, and for the 17 LGUs of the Metro Manila area, this empowered to provide their direct involvement of MMDA will support the input/feedback for specific project institutional link to the Local Government Units. actions through the coordination mechanisms. Risk that the City of Marikina does not M The City of Marikina is an implementing agency continue its commitment to socially and in the project and a direct recipient of a GEF environmentally sustainable transport Grant for the project. A Bikeways Project Office policies and planning. is located in the City. From Components to Outputs Risk of delay on some key components of M Institution-building support will be provided to the project under MMDA since they have the MMDA. Components of the current Air no experience implementing a project Quality Project are implemented by the MMDA, under World Bank funding with its related and institution-building activities under that requirements. project will aid the MMURTRIP project. Risk of procurement delays under both M The DPWH is revising its procurement systems the Department of Public Works and (under NRIMP) and the Government systerr, as Highways (DPWH) and the MMDA. a whole will streamline procurement. Changes include using post-qualification instead of prequalification, which should speed processing. The World Bank Manila office provides direct assistance and training. A detailed procurement schedule will be developed. Timely availability of counterpart funds. M The country team reviews the Government budget situation. Counterpart funding is part of the multi-year program discussions of the DPWH and the Government in their annual review and consultations. Overall Risk Rating M Risk Rating - H (High Risk), S (Substantial Risk), M (Modest Risk), N(Negligible or Low Risk) - 27 -  3. Possible Controversial Aspects: While no controversial aspects are identified for the project specifically it is noted that corruption is a concern in the Philippines. The World Bank report "Combating Corruption in the Philippines" (May 3, 2000) indicates that of the total corruption complaints received by the Ombudsman's Office from 1993 to 1998, 27 percent (1,762 complaints) were about the Department of Public Works and Highways (Ombudsman' Office 2000). Procurement in the DPWH is typically done for large and complex works, and difficulties do arise. Under the NRIMP project the department is making a major effort to develop and streamline transparent systems of procurement and financial management, which will be expanded nationwide. Under the MMURTRIP project all contracts are subject to prior review by the World Bank. Although the World Bank report mentioned above does not address the MMDA, all contracts in the MMDA will also be subject to such prior review. The institutional framework of the MMURTRIP project (a steering committee and the involvement of the MMDA and local government units) will also contribute to transparency. G. Main Conditions 1. Effectiveness Condition 1. The standard effectiveness condition of the legal opinion from the Philippines Department of Justice applies. The following are specified as additional matters, to be included in the legal opinion or options to be furnished to the World Bank: (a) that the Project Agreement has been duly authorized or ratified by Metropolitan Manila Development Authority (MMDA), is legally binding upon MMDA in accordance with its terms. (b) that the Subsidiary Agreement has been duly authorized or ratified by the Borrower and MMDA, and is legally binding upon MMDA and the Borrower in accordance with its terms. (c) that the Resettlement Policy and Resettlement Action Plans for Marikina Bridge and Access Road component and the Resettlement Action Plan for Don Mariano Marcos Avenue Extension component are legally binding upon DPWH and MMDA in accordance with its terms. 2. that the Subsidiary Agreement has been executed on behalf of the Borrower and MMDA. 3. that the GEF Grant Agreement has been executed and delivered. 4. that the Supplemental Environmental Assessment and Mitigation and Monitoring Plans for each the Marikina Bridge and Access Road component and the Marcos Highway component has been adopted by the DPWH (see paragraph 5.1). 2. Other [classify according to covenant types used in the Legal Agreements.] In addtion to the standard legal covenants on financial management, audit, reporting and performance indicators the following are project specific legal covenants: 1. (a) The Borrower shall maintain the Steering Committee to monitor the progress of the Project and to coordinate its components. (b) The Borrower shall maintain the Project Management Office in each of DPWH and MMDA headed by a Project Director with qualifications and experience satisfactory to the World - 28 -  Bank, assisted by such other competent staff in adequate numbers having such functions, responsibilities, funds and other facilities as shall be required to enable the Project Management Office to undertake the overall supervision and monitoring of the Project. 2. (a) The Borrower will implement the Project in accordance with the Project Implementation Plan; and (b) The Borrower will only amend the Project Implementation Plan in agreement with the World Bank. H. Readiness for Implementation 1 1. a) The engineering design documents for the first year's activities are complete and ready for the start of project implementation. El 1. b) Not applicable. 1 2. The procurement documents for the first year's activities are complete and ready for the start of project implementation. O 3. The Project Implementation Plan has been appraised and found to be realistic and of satisfactory quality. El 4. The following items are lacking and are discussed under loan conditions (Section G): !. Compliance with Bank Policies Z 1. This project complies with all applicable Bank policies. El 2. The following exceptions to Bank policies are recommended for approval. The project complies with all other applicable Bank policies. Sally L. Bumingham Jitendra N. Bajpai Vinay K. Bhargava Team Leader Sector Director Country Director Senior Transport Engineer - 29 -  Annex 1: Project Design Summary PHILIPPINES: Metro Manila Urban Transport Integration Project Hirach o Ojetves niator Moni0toing &; Evauaion94;l Critical supio4ns Sector-related CAS Goal: Sector Indicators: Sector/ country reports: (from Goal to Bank Mission) CAS Objective: Poverty Maintenance of favorable reduction: "Develop macroeconomic environment. infrastructure"and "Promote sustainable urban development." Sector-related CAS Goal: * Improved transit * Traffic and public Improve deteriorating urban capacity and modal transport studies and transport situation in Metro integration in Metro surveys in Metro Manila. Manila. Manila. GEF Operational Program: Project Development Outcome / Impact Project reports: (from Objective to Goal) Objective: Indicators: To improve the operational * Reduced travel time * MMUTIS initial and Effective coordination efficiency and safety of the experienced by public monitoring data on between the DPWH, local transport system of Metro transport users on the mobility pattems, travel govemment units, the DOTC, Manila, with better project corridors. time/costs, and modal and the MMDA. opportunities to use public shares in Metro Manila transport and nonmotorized and other specific transport, the dominant surveys. transport modes of low-income residents. * Sustained current * Public transport proportion of public operators and transport use on the association records, project corridors. data, and annual reports * Improved satisfaction of * Public opinion and public transport users on transport usage surveys the project corridors. to be conducted at project inception and one year after works completion on project corridors. Responsible agency: MMDA. - 30 -  Key Performance Mierarchy of Objectives Indicators Monitoring & Evaluation Critical Assumptions Output from each Output Indicators: Project reports: (from Outputs to Objective) Component: A. Traffic Management * Improved level of * Travel time surveys on The MMDA's participation Improvements service of the corridors project corridors at was ensured throughout Complementary traffic measured by average project inception and project preparation. The enforcement measures such as travel speed of all one year after works MMDA is a direct participant control of frontage activities through-vehicles along completion. Responsible in project implementation and and adherence to traffic rules, the corridors. agency: MMDA. thus a key stakeholder that proposed traffic circulation will have an interest in strategies, and general traffic * Improved level of * Modal share surveys on ensuring the project impact management implemented by service for bus and project corridors at and its sustainability. the MMDA and related jeepneys along the project inception and responsible agencies and corridors measured in one year after works LGUs have improved the terms of productive completion. Responsible Local Government Units of effectiveness of the corridors capacity average. agency: MMDA. Metro Manila continue to be and their elements, including consulted regularly, involved intersections, public transport * Improved level of in project implementation, interchanges, and passenger service of walkways and * Specific surveys at and empowered to provide and pedestrian facilities. public transport queuing project inception and their input/feedback for areas. one year after works specific project actions completion. Responsible through the coordination agency: MMDA with mechanisms. DPWH-TEC. B. MARIPAS Access * Decreased average Improvements have travel time and cost improved the accessibility of (across modes) for trips the Marikina Valley. with Origin-Destination in the Marikina Valley. C. Efficient organization of * Increased level of the Secondary Roads in a service of the secondary hierarchy has improved roads measured by traffic dispersal and increased average travel speed of capacity. all through-vehicles. * Increased capacity at intersections between secondary roads and project corridors. - 31 -  D. Development of * Increased nonmotorized * Travel surveys and The City of Marikina remains Nonmotorized Transport transport mode share for traffic counts for the committed to socially and Facilities has improved public trips within Marikina City of Marikina to be environmentally sustainable transport accessibility and and nonmotorized conducted at project transport policies and mobility of low income users. transport-public inception and one year planning. transport combined after works completion. mode share for trips Responsible agency: originating in Marikina. City of Marikina with the assistance of MMDA. E. Increased Institutional * Effective coordination * Regular travel and Capacity has improved mechanism in place traffic surveys metropolitan governance and between the key (including users' strengthened local agencies and Local satisfaction indicators) government functions. Government Units. along major corridors and at intersections and * Effective traffic public transport management and facilities by the relevant enforcement measures agencies. planned and designed by the relevant agencies. - 32 -  Key Peel ormance Hierachy of Objecves Indicators Monitoring & Evaluation Critical Assumptions Project Components / Inputs: (budget for each Project reports: (from Components to Sub-components: component) Outputs) A. Traffic Management US$13.5 million * Supervision reports Institution-building support is Improvements from supervision provided to the MMDA, consultants which demonstrates sufficient implementation capacity despite lack of experience with World Bank projects. B. MARIPAS Access US$48.2 million * Quarterly Project Revision of procurement Improvements Management Reports systems, under way in the (PMRs) from DPWH, and the Government implementing system as a whole, streamline agencies . procurement . C. Secondary Roads Program US$32.7 million D. Nonmotorized Transport US$1.5 million * Project audit reports Timely availability of counterpart funds. E. Institution Building US$1.1 million TOTAL US$97.0 million - 33 -  Annex 2: Detailed Project Description PHILIPPINES: Metro Manila Urban Transport Integration Project By Component: Project Component 1 - US$13.50 million PhP675 rnillion including all physical and price contingencies. A. Traffic Management Improvements. Implementation arrangements. The Metropolitan Manila Development Authority (MMDA) is the implementing agency for these Traffic Management Improvements components. MMDA will undertake their own procurement and award of contracts, have their own financial management, have their own special account, produce their own Project Management Reports (PMRs), and monitor impact of these components against defined monitoring criteria. MMDA will procure their own consultant services for construction supervision and for advisory services related to these components. The procurement methods are indicated in Annex 6. Aspects to be addressed. The project components (Table 2. 1) include public transport improvement measures comprising integration between modes, improvement of interchange facilities, and measures for introducing public transport priority; traffic management (both at and between intersections); measures for controlling inappropriate frontage activity and measures for improving road safety for pedestrians by providing sidewalks and other facilities; measures for bicycles and pedicabs; and safe bicycle parking at stations. Landscaping and greening will be included on all project components. Table 2.1 Components of Traffic Management Improvements LRT Line 2 corridor-CM City of Manila, San MMDA 12 5.5 275 Recto to Marcos Bridge Juan, Quezon City, (Santolan) City of Marikina, and Pasig City EDSA LRT Line 3 corridor- Quezon City, MMDA 18 5.7 285 North Avenue to Roxas Mandaluyong, Makati, Boulevard and Pasay City Southern corridor-Bicutan Paranaque MMDA n/a 0.6 30 interchange improvements Southern corridor-Alabang Muntinlupa MMDA n/a 1.7 85 interchange improvements Total 13.5 675 Note "Agency" indicates the agency implementing the civil works. * LRTLine 2 corridor - CMRecto-Marcos Bridge (Santolan). This component aims to integrate at street level the current investments on the Light Rail Transit (LRT) Line 2 under Japanese Bank for International Cooperation (JBIC) financing. In the environs of Recto Station, the project will improve pedestrian access between the station and surrounding attractions, including bus terminals, - 34 -  Quiapo Church and the nearby LRT Line 2 corridor; improve roads used for bus and jeepney circulation in the area; and improve interchange arrangements between LRT Line 2 and passing jeepney routes. In the environs of Legarda Station, the project will improve pedestrian routes between the station and surrounding land uses (predominantly universities); enhancements include possible closure of the road leading to the station to create a pedestrianized station approach. From Nagtahan to Araneta, the project will provide pedestrian crossings and sidewalks with an emphasis on the Nagtahan intersection, where existing pedestrian facilities are inadequate. The project will improve the Old Santa Mesa intersection (the confluence of two busy jeepney routes and the site of the Stop and Shop jeepney terminal) and the Araneta intersection. From Araneta to Cubao, Cubao to Katipunan, and Katipunan to Marcos Bridge, the project will improve pedestrian facilities, institute trafflc management measures at intersections, and improve access to the LRT stations. * EDSA LRT Line 3 corridor - North Avenue to Roxas Boulevard. This component aims to integrate at street levels the LRT 3 system, which started operating in December 1999. This system was implemented under private financing arrangements. The objective of this project component is to reduce delays to public transport by generally improving intersection operations and bus stopping arrangements. * Southern corridor - Bicutan interchange improvements. This interchange on the South Super Highway currently functions as major public transport interchange between bus services on the expressway and jeepney feeder services on the adjacent service roads and other major access routes. The project proposals center on traffic management improvements to facilitate the modal transfer and improve sidewalk provision and crossings for pedestrians interchanging at these points. * Southern corridor - Alabang interchange improvements. This interchange on the South Super Highway currently functions as major public transport interchange between bus services on the expressway and jeepney feeder services on the adjacent service roads and other major access routes. The project proposals center on traffic management improvements to facilitate the modal transfer and improve sidewalk provision and crossings for pedestrians interchanging at these points. Project Component 2 - US$48.20 million PhP2,410 million, including all physical and price contingencies. B. MARIPAS Access Improvements. Implementation arrangements. The Department of Public Works and Highways - Urban Roads Project Office (URPO) is the implementing agency for these MARIPAS Access Improvements. DPWH-URPO will undertake their own procurement and award of contracts, have their own financial management, have their own special account, produce their own Project Management Reports (PMRs), and monitor impact of these components against defined monitoring criteria. DPWH-URPO will procure their own consultant services for construction supervision and for advisory services related to these components. The procurement methods are indicated in Annex 6. Aspects to be addressed. The MARIPAS-Marikina Valley area is characterized by large commuter flows, as local residents seek work in central and western parts of Metro Manila. The Local Government Units (Marikina City, Rizal province, and Pasig City) jointly produced a plan to tackle their various common - 35 -  transport problems. The components emerging from the plan (Table 2.2) will be addressed under the project. Landscaping and greening will be included on all project components in line with DPWH Order No 15, Series of 2000 which requires Tree Planting along National Roads. Table 2.2 Components of MARIPAS Access Improvements Component ~~~OICa Government Aey km cost Cs Marikina Bridge and Marikina, Quezon City DPWH n.a 23.3 1165 Access Road (linking C5 to URPO Marcos Highway) Marcos Highway Marikina, Pasig, DPWH 4.6 19.7 985 (Marcos Bridge/Santolan to Cainta, Antipolo URPO Masinag) Ortigas Avenue Extension Pasig, Cainta, Taytay DPWH 6.8 5.2 260 (C5-Manggahan-Tikling) URPO Total 48.2 2410 Note. "Agency" indicates the agency implementing the civil works. n.a.= not applicable. 9 Marikina Bridge and Access Road component (linking C5 to Marcos Highway). This link is an alternative route between the C-5 circumferential route and the Marcos Highway. The alignment runs from the E. Rodriquez Avenue/Boni Serrano intersection to Marcos Highway in the vicinity of the Marcos Bridge/Santolan LRT Line 2 station. The scheme will relieve the Marcos Highway/Aurora Boulevard corridor and provide an alternative route for C-5, thus improving access to the east of Metro Manila. LRT Line 2 is being constructed as far as the terminal/depot at Santolan (adjacent to the Marcos Highway); the project proposes to ensure that jeepneys can function as feeder services to this station. Four hundred jeepneys an hour pass the site in each direction. Once the station is established, at least 100 jeepneys an hour should be able to turn around at the station, thus acting as a feeder service to the LRT rather than going all the way downtown. The project therefore includes jeepney dropoff and turnaround facilities. - Marcos Highway (Marcos Bridge/Santolan to Masinag). This component begins adjacent to the final station of the LRT Line 2, Santolan station and extends to Sumulong Highway at Masinag. The proposal is to establish an at-grade traffic management scheme which, together with priority measures for public transport, will act as an efficient conduit for traffic to and from Metro Manila. It will also assist public transport vehicles to access the LRT terminal, thus providing greater integration between road-based and rail-based public transport services. It is intended that the roadway be widened to 4 lanes in each direction, with additional lanes as required at intersection approaches. The designs include a cross-section to allow for sidewalks, bicycle lanes, covered drains, tree lining and a 4-meter-wide median for future eastward expansion of the LRT 2 line. This road extension is one of the most critical in the whole Marikina Valley and provides one of the few access roads to the eastern areas of Metro Manila. The designs include automated and coordinated traffic control systems, and intersection and corridor management measures including adequate sidewalks, pedestrian crossings, and public transport priority. The results of TRANSYT runs indicate that as significant increase in overall traffic speed could be achieved by a properly managed coordinated traffic signal system. Existing system AM peak 8.5 kilometers per hour and with management improvements 16 kilometers per hour. - 36 -  * Ortigas Avenue Extension (CS-Manggahan-Tikling). This road section is one of the most critical in the whole Marikina Valley and provides one of the few access roads to the eastern areas of Metro Manila. Proposed improvements include automated and coordinated traffic control systems, and intersection and corridor management measures including adequate sidewalks, pedestrian crossings, lighting, and public transport priority. Project Component 3 - US$ 32.70 million PhP1,635 million, including all physical and price contingencies. C. Secondary Roads Progranm Implementation arrangements. The Department of Public Works and Highways - Urban Roads Project Office (URPO) is the implementing agency for ten of the Secondary Roads Program components as given in Table 2.3 below. DPWH-URPO will undertake their own procurement and award of contracts, have their own financial management, have their own special account, produce their own Project Management Reports (PMRs), and monitor impact of these components against defined monitoring criteria. DPWH-URPO will procure their own consultant services for construction supervision and for advisory services related to these components. The procurement methods are indicated in Annex 6. The Metropolitan Manila Development Authority (MMDA) is the implementing agency for five of the Secondary Roads Program components as given in Table 2.3 below. MMDA will undertake their own procurement and award of contracts, have their own financial management, have their own special account, produce their own Project Management Reports (PMRs), and monitor impact of these components against defined monitoring criteria. MMDA will procure their own consultant services for construction supervision and for advisory services related to these components. The procurement methods are indicated in Annex 6. Aspects to be addressed. The proposed interventions of this program (Table 2.3) component, on about 70 km of secondary roads, include a wide range of actions for comprehensive corridor treatment to allow secondary roads to fulfill their function in the road hierarchy. These actions include pavement rehabilitation, drainage and sidewalk improvements, traffic management measures, and construction of missing links. While proposals for major widening and major right-of-way acquisition issues have been removed from the project, the project includes the remaining set without major widening but with missing links, on the basis of the priority drawn up by the DPWH. One road link, the Don Mariano Marcos Avenue Extension, involves acquisition of a strip of land 18 meters by 500 meters from a commercial landowner. This will complete a missing link between major roads. Landscaping and greening will be included on all project components. Table 2.3 Components of the Secondary Roads Program Component Local Government Agency km cost Cost Units involved (US M) (Pmp)) D. Romualdez City of Manila DPWH 1.44 0.2 10 Legarda City of Manila DPWH 0.97 0.2 10 Quezon Boulevard City of Manila DPWH 1.28 0.2 10 Pasong Tamo Makati MMDA 2.42 2.9 145 Pedro Gil/New Panaderos City of Manila DPWH 5.17 1.9 95 - 37 -  Tayurnan City of Manila DPWH 1.37 0.9 45 M. de la Fuente (Trabajo) City of Manila DPWH 2.14 0.1 5.0 Jacobo Fajardo City of Manila DPWH 1.00 0.1 5.0 South Super Highway Pasay, Paranaque, DPWH 14.3 7.3 365 West/East Service Road Muntinlupa 12.9 Quirino Highway Quezon City DPWH 11.8 6.8 340 10 th Avenue Caloocan DPWH 2.83 1.1 55 Don Mariano Marcos Ave Ext Quezon City MMDA 1.00 6.9 345 Antonio Amaiz Avenue Makati MMDA 2.01 1.0 50 Sen. Gil Puyat Avenue Makati MMDA 5.43 1.6 80 Banaue Avenue Quezon City MMDA 3.00 1.5 75 Total 69.1 32.7 1,635 Note "Agency" indicates the agency imnplementing the civil works Project Component 4 - US$1.50 million PhP 75 million, including all physical and price contingencies. D. Nonmotorised Transport (NMT) component. The City of Marikina will implement this component and the Global Environment Facility (GEF) will provide funding support. The City of Marikina will undertake their own procurement and award of contracts, have their own financial management, have their own special account, produce their own Project Management Reports (PMRs), and monitor impact of this component against defined monitoring criteria. Background. The DPWH proposed a pilot component for a nonmotorized pedestrian and bicycle path in Marikina Valley to connect communities with employment centers and LRT stations. This proposal stemmed from the work of the DPWH-Urban Roads Project Office (URPO) with the NGO Green Forum. Statistics show that 20 percent of total trips are walking trips in the MARIPAS area, where the component is proposed. People in this area make more trips on foot and by tricycle than on average throughout Metro Manila. Twenty-two percent of all trips are made on foot and 30 percent by tricycle, compared with 20 percent on foot and 14 percent by tricycle in Metro Manila, where tricycles are banned on many major cornidors. The City of Marikina, one of the 17 municipalities of Metro Manila, is a medium-size city of about 360,000 people situated at the eastem border of the Metro Manila administrative area. Metro Manila has a population of 9,447,156, of which Marikina accounts for 357,231 (MMUTIS 1995). Because the city is located somewhat on the periphery of Metro Manila, levels of congestion have not yet reached the intolerable levels of inner Metro Manila. About 2.9 percent (10,500) of all trips in Marikina are made by bicycle, compared with 1.7 percent (160,200) in Metro Manila. In terrns of ratio to population, 1.7 percent of the Metro Manila population uses bicycles for trips compared with 2.9 percent in Marikina. But predicted increase in traffic will likely cause the level of bicycle use in Marikina to decline to the current levels in most of Metro Manila. In Metro Manila 20 percent of households own cars, while in Marikina only 15 percent of households own cars. Objective. Given Marikina's current high and accepted bicycle use and lower levels of congestion, the project considers it an ideal city in which to irnplement a bicycle network to preserve this mode of transport - 38 -  in the face of the inevitable creep of congestion by motorized transport. This pattem has already been experienced in inner Metro Manila and many other Asian metropolises, where bicycles have been crowded out as a viable mode of transport. The net result of the dominance of motor vehicles in Metro Manila has been severe congestion accompanied by air pollution and severe constraints on transportation, especially for the poor, who then become captive users of unpleasant, expensive, and unreliable public transport. Benefits. Given the present growth trends in transport demand and motorization, the direct benefits of developing the bikeway system proposed under the project will be a reduction in expected traffic and congestion and a consequent decrease in emissions of pollutants compared with the situation without the project. An additional indirect benefit, of no lesser value, will be to demonstrate the benefits and viability of bicycles and nonmotorized transport so that similar facilities might be adopted/developed elsewhere in Metro Manila and in the Philippines once people recognize that this form of transport is sustainable, nonpolluting, inexpensive, and a good altemative for commuting. Description. The Nonmotorised Transport (NMT) component in the City of Marikina will include the following: * A network of about 66 kilometers of bikeways of which 50 kilometers will be developed along existing roads and 16 kilometers of bikeways along the Marikina River banks. The network will connect the residential areas with the main trip attractors (factories, schools, hospitals, market areas and shopping malls) and public transport terminals including the new LRT line 3 stations. * Traffic calming and pedestrianization measures and facilities around schools and market areas and provision of bicycle parking facilities. * Street lighting where necessary to ensure safety after hours. * Training and Capacity Building of the Marikina bicycle officials working staffing the Bikeways Program Office, with particular focus on planning capacity and monitoring and evaluation activities. 3 Education and public awareness campaigns targeted to potential users as well as car users and city's traffic management/enforcement personnel. 3 Replication campaigns targeted to neighboring Municipalities and other cities that are suitable for bikeway development. The 66 kilometer bikeway network will connect residential communities with schools, employmnent centers, the new LRT station, and other public transport terminals, where appropriate parking facilities will be created. Its development will help prevent the crowding-out of nonmotorized transport seen in other large cities. Moreover, the connection with public transport terminals will promote the use of nonmotorized transport combined with LRT/bus for trips between Marikina and the rest of Metro Manila. A series of pedestrianized areas and traffic calming measures will preserve walking trips. Street lighting in some areas will improve the safety of both cyclists and pedestrians. The current road network within the municipal boundary covers 300 kilometers. The 66 kilometer bicycle network connecting key attractors, schools, industrial sites, the new LRT metro terminal, markets, and malls will be implemented in three phases over three years. The proposed network will include 49.7 k ilometers on existing roads, of which 30.8 kilometers are within the existing roadway width and 18.9 kilometers require some road widening to accommodate the bicycle lanes. 16 kilometers will be along the banks of the Marikina River (connecting to the LRT station), of which 8.4 kilometers are new construction and 8.2 kilometers involve upgrading existing walking paths. The bicycle lanes will be physically separated from other traffic but largely within the existing roadway, - 39 -  with flow largely on each side of the road on two-way roads and on one side on one-way roads. The lanes will be 1.5 meters wide, with a physical barrier provided between adjacent traffic and the bicycle lanes (figure 2.2). Traffic counts done at seven strategic locations in the City of Marikina in October 1999 showed about 70 bicycles in the peak hour. Thus the proposed 1.5 meter width is considered sufficient (the Netherlands recommnends 1.5 meters for 0-150 bicycles per hour in peak hour). Issues of roadside access to shops and properties will be addressed during the detailed design stage. Where pavement has deteriorated, reconstruction may be necessary. Green asphalt or concrete will be used to designate the bicycle lanes. Where necessary some new facilities will be constructed to facilitate access, for example in the access to the new LRT station on the southern boundary of the City of Marikina. This facility will link to the main components of the MMURTRIP project, namely the Marikina Bridge and Access Road component and the Marcos Highway component. Figure 2.2 Typical cross section, Bayan-Bayaanan Road (metres) 15.6 1.5 12.6 1. Training, Capacity Building, Education and Replication Campaigns. The City of Marikina has established a Bikeways Program Office (BPO) within the City administration. The BPO will consist of a core team of six people including a Program Manager, an Education Program and Coordinator, and an Events and Promotions Coordinator. These officers will be assisted and trained so that they can properly develop, implement, and monitor the Bikeways Program. Moreover, they will coordinate the educational and promotion campaigns that will be carried out in Marikina as well as in its neighboring municipalities and in other Philippines cities. These campaigns will be prioritized and will first target cities that are well suited for bikeway development. These will be cities that are similar to Marikina in terms of modes of transport, high-density building, lack of space, and where a bicycle culture already exists. The BPO in collaboration with local NGOs will carry out a Baseline Research which will provide inputs for the implementation of the Bikeways Program as well the foundation for the monitoring and evaluation activities. The evaluation activities in particular will focus on the project as well as on the methodology applied to estimate the benefits deriving from the resulting saving in greenhouse gas emissions. A five-year plan for the development of the bikeways will also be part of the responsibilities of the BPO. Consultant services will be provided to enhance the capacity of the BPO to the mentioned planning and monitoring and evaluation activities. Costing. The cost of the Nonmotorized Transport component is estimated at US$1.51 million, of which Global Environment Facility (GEF) grant financing is US$1.26 million. The City of Marikina will provide the counterpart (Table 2.4). The breakdown of the costs is given in the table below. The cost of detailed engineering design, surveys costs and supervision is estimated at 10 percent of the cost of the works and included in the cost of the component. Works will be executed by local contractors , so taxes are estimated at 20 percent of the total amount of works and 7 percent of the services. This will be paid by the Administration so a total of about 16 percent of project costs will be covered by the City of Marikina. In particular 20 percent of the cost of the public dissemination and bicycle safety campaign will be covered by the City of Marikina. This work will be done by the Bikeways Prograrn Office staff and considered as their - 40 -  counterpart to the project cost. Table 2.4 Components of the Nonmotorised Transport component Component Sector Indicative GEF City of City of costs (US$m) financing Marikina Marikina (US$m) (US$m) (%) Bikeways (66 Urban 1.08 0.92 0.16 15% kilometers) Transport Traffic calming and Urban 0.18 0.14 0.04 22% pedestrianisation Transport Lighting Urban 0.10 0.08 0.02 20% Transport Training and capacity Urban 0.05 0.04 0.01 20% building at the BPO Transport Education Campaigns Urban 0.05 0.04 0.01 20% _____ ____ ____ Transport_ _ _ _ __ _ _ _ _ _ Replication Urban 0.05 0.04 0.01 20% Campaigns Transport Total 1.5 1.26 0.25 16.5% Beneficiaries. A series of focus group discussions were held on successive weekends in October 1999 to gauge public perceptions of bicycling in the City of Marikina and of the proposals for a bicycle network. Residents use bicycles significantly and clearly voiced the benefits of this mode of transport. They considered this mode beneficial for the poor. The participants in the discussions felt that congestion in Marikina was still relatively low, making cycling a still-viable mode of transport. Having seen other parts of Metro Manila, however, they felt this situation would not last. Some already felt that cycling was hazardous (few women cycle, for that reason), and felt strongly that bicycle lanes physically protected from other traffic were needed. Participants also strongly demanded a bicycle safety and education campaign. Residents said they would be prepared to pay fees for bicycle parking and security facilities. The Marikina City Workers Affairs Office surveyed 12 companies involved in food manufacturing; shoe manufacturing; marketing, sales, and rental of heavy equipment; and other sectors in October and November 1999. The surveys found that 53 percent of the workers in these companies live within the City of Marikina and the rest in adjacent municipalities. Thus the average travel distance in Marikina is within what is considered viable for bicycle travel (bicycle trips up to 6 or 7 kilometers long are considered viable). The current modal share of trips of workers in Marikina (table 2.5) is 1 1 percent bicycles, 3 percent pedicabs, and 28 percent walking. - 41 -  Table 2.5 Modes of transport to work used by Marikina workers Mode of Transportation to work Number of trips by mode Percentage Company shuttle 48 1 Public transport 1,479 41 Tricycle (motorized) 309 9 Pedicab (nonmotorized) 111 3 Bicycle 410 11 Walking 1,019 28 Others 239 7 Total 3,615 100 Source: Marikina City Workers Affairs Office 1999. Project Component 5 - US$1.10 million PhP55 million, including all physical and price contingencies E. Institution Building/Technical Assistance component. The Metro Manila Air Quality Improvement Sector Development Program supported by the Asian Development Bank includes a component to strengthen the MMDA's traffic management function in 2000 to 2004. The MMURTRIP project will complement this program by supporting capacity building in 2001 to 2005. The MMDA (in consultation with the DPWH) has developed a year-by-year institutional plan, including a description of its expanding functions and staffing requirements. Moreover, this component aims to ensure that effective coordination mechanisms are in place between the key agencies and LGUs. This coordination will favour the balanced integration among modes, including Nonmotorised Transport (NMT). -42 -  Annex 3: Estimated Project Costs PHILIPPINES: Metro Manila Urban Transport Integration Project Local Foreign Total Project Cost By Component US $million US $million US $million A. Traffic management improvements 0.00 LRT Line 2 corridor 2.20 2.40 4.60 EDSA LRT Line 3 corridor 2.50 2.50 5.00 Southern corridor-Bicutan interchange improvements 0.30 0.30 0.60 Southern corridor-Alabang interchange improvements 0.70 0.70 1.40 B. MARIPAS Access Improvements 0.00 Marikina Bridge and Access Roads 14.40 5.60 20.00 Marcos Highway 8.90 7.30 16.20 Ortigas Avenue 1.60 3.20 4.80 C. Secondary Roads Program 16.50 10.20 26.70 D. Nonmotorised Transport (NMT) pilot 0.80 0.70 1.50 E. Technical Assistance/Institution Building 1.00 0.00 1.00 Total Baseline Cost 48.90 32.90 81.80 Physical Contingencies 2.90 1.70 4.60 Price Contingencies 7.60 3.00 10.60 Total Project Costs 59.40 37.60 97.00 Front-end fee 0.60 0.60 Total Financing Required 59.40 38.20 97.60 Local Foreign Total Project Cost By Category US $million US $miilion US $miflion Civil Works 39.90 24.30 64.20 Equipment 0.50 5.90 6.40 Services 2.80 7.20 10.00 PMO engineering overhead and Land Acquisition; 16.40 0.00 16.40 Operations and Maintenance Total Project Costs 59.60 37.40 97.00 Front-end fee 0.60 0.60 Total Financing Required 59.60 38.00 97.60 Note: Discrepancies in project costs are the result of figures being rounded. The component costs are made up of construction costs, provision of street lighting, and provision of traffic signals. The costs include all detailed engineering design costs, construction supervision costs, project management office engineering overhead, advisory services and local taxes. l. Detailed engineering cost for phase I was PhP23,053,200 (about US$576,330 equivalent at the time of the contract) 2. Detailed engineering costs for phase II are estimated at 6 percent of civil works costs. 3. Construction supervision costs are estimated at 10 percent of civil works costs. 4. Project Management Office engineering overheads are estimated at 3.5 percent of civil works costs. 5. Advisory Services are estimated at 3 percent of civil works costs. 6. Operations and Maintenance costs during the project implementation period are included in the project costs. 7. Local taxes and duties on works are estimated at 20 percent (based on a study of actual contracts - 43 -  under the Highway Management Project), on services at 7 percent, and on vehicles and computers at 30 percent. 8. Civil works: Foreign cost: 40 percent; local cost: 60 percent (for Traffic Engineering Center related works local cost is 100 percent) 9. Services: Foreign cost: 80 percent; local cost: 20 percent; Project Management Office engineering overhead, 100 percent local cost. 10. Signal equipment: Foreign cost: 100 percent. 11. Foreign inflation is estirated at 3 percent per annum (based on the World Bank's Development EC Planning Assumptions Note November 2000); local inflation rate is estizmated at 7 percent per annum. 12. Land acquisition costs are estimated at total of US$ 13.5 million for two project components. 13. World Bank cost sharing lirmit for Loans for the Philippines is 75 percent of total project cost, net of taxes. 14. Front end fee is 1 percent of World Bank Loan amount. Identifiable taxes and duties are 12.7 (US$m) and the total project cost, net of taxes, is 83.6 (US$m). Therefore, the project cost sharing ratio is 71.77% of total project cost net of taxes. - 44 -  Annex 4: Cost Benefit Analysis Summary PHILIPPINES: Metro Manila Urban Transport Integration Project The economic evaluation has been carried out utilizing a standard cost benefit analysis (CBA). The evaluation covers the Project's major investment components: Traffic Management Improvements, MARIPAS Access Improvements, and Secondary Roads Program. These components account in total for about 94 percent of the project cost. Given their specific nature, two other components are not considered in this analysis: Nonmotorized Transport (NMT) Pilot and Institution Building/Technical Assistance. The Nonmotorized Transport component was the subject of a detailed incremental cost analysis (ICA), which is described in Annex 14. In the framework of the CBA approach, the investments in each of the project's subcomponents were evaluated separately to ensure that each is economically viable. The results were then aggregated at project level. Whenever possible, costs and benefits were quantified by comparing "with" and "without" project scenarios. Benefits are derived from vehicle operating cost (VOC) and value of time (VOT) savings. Costs include initial construction costs, right-of-way acquisition and future maintenance costs. The basic data, main assumptions, and methodology used in the evaluation, as well as an example of their application and the results of the evaluation (table 4.1), are summarized in the following sections. Full details of the economic evaluation can be found in the MMURTRIP Feasibility Study carried out in 1998 by local and international consultants (see project file). Table 4.1 Costs and benefits of the MMIRTRIP project (US$ million) Benefits 1063* Costs 94 Net Benefits 969 Internal Rate of Return 137 percent *Present value of flows discounted at 15 percent. Summary of Benefits and Costs: Data Sources The evaluation relies heavily on the data available from the Japan Bank for International Cooperation (JICA)-funded Metro Manila Urban Transportation Integration Study (MMUTIS) from March 1997. These data are recent and comprehensive and cover most of the needs for the CBA approach. The MMUTIS study includes the whole of Metro Manila together with the surrounding municipalities that make up the Greater Manila metropolitan area. The main types of data used from this source are origin-destination (O-D) trips, including land-use and socioeconomic information; cordonline and screenline vehicle and passenger counts; public transport (bus and jeepney) frequency data; public transport boarding, alighting, and terminal use data; and travel speed data. For the evaluation of some specific components, MMURTRIP Study consultants used more detailed traffic data than is available from MMUTIS. These data include traffic counts at signalised and nonsignalised - 45 -  intersections obtained from the Traffic Engineering Center (TEC) of the DPWH. Transport Models MMUTIS developed a state-of-the-art recursive transportation model for Metro Manila. In this model, the network conditions were specified separately for each of the vehicle types, allowing bus lanes and truck bans to be modeled. However, the capacity restraint procedures in the model could refer only to network links, and delays at junctions were not simulated for individual turning movements. There were also some limitations in the way the model dealt with the choice between different transport modes. Moreover, at the time of this economic evaluation the model was not sufficiently developed to be of use in analyzing travel demand pattems in the MMIURTRIP corridors. Therefore, the MMURTRIP Study consultants integrated the information of the MMUTIS model with a series of basic assumptions to quantify the existing transport situation along the project corridors and to make predictions about the future. These assumptions are summarized in the next sections. Transport Demand Forecasts While basing its conclusions on present-day transport requirements in Metro Manila, the MMURTRIP Study addresses the impact of future changes in distribution of land uses and pattem of transport provision in order to evaluate the feasibility of the proposed components. However, as noted above, neither the development of future land use scenarios nor the development of the analytical transport model were sufficiently advanced for the purposes of the economic evaluation. Therefore the evaluation was based on figures for future transport demand pattems estimated by the MMURTRIP Study Team, assuming the possible development scenarios considered by MMUTIS. Generally this has amounted to applying simple growth factors and ad hoc analyses of the diversionary effects of new transport infrastructure, tempered by professional judgment and detailed knowledge of the existing situation. Intersection Analysis The TRANSYT/10 suite of programs was used extensively to analyze signalised intersections, calculate revised signal timing/phasing, and test the impact of revised geometric layouts for the design of the new installations. The outputs included accumulated delay and other performance indicators, which provided useful inputs to the evaluation. Main Assumptions: Traffic Flows The estimation of benefits depends on the traffic flows through each project. Given the lack of a model capable of assessing either traffic growth or reassignment resulting from network modifications, it has been necessary to use uniform growth factors inside Epifanio de los Santos Avenue (EDSA) and outside to estimate future traffic flows. Traffic within EDSA is assumed to grow at a 2 percent rate, and traffic outside EDSA at a 5 percent rate. This assurnption is based on past experience with different schemes in Metro Manila. In accordance with normal practice, these growth rates have only been applied up to the point where the existing network can accommodate traffic flows. The growth rate assumption is conservative, because it ignores the benefits enjoyed by road users who take up the additional capacity provided by the project. Hence it reduces the possibility of overestimation of benefits. In the case of road projects, the study used Metro Manila Urban Transportation Integration Study (MMUTIS) "unlinked" trip survey data to analyze travel patterns in the relevant corridor, together with - 46 -  simple diversion curves to predict reallocation of corridor traffic to new roads. For the public/private modal split, the study assumed the overall growth would not change the respective modal shares of private and public transport, even with growing car ownership. This assumption is justified by the fact that improvements to the public transport system to be implemented in future years would enhance the attractiveness of public transport services, which in turn is expected to offset higher car ownership levels. In the corridors where new fixed public transport facilities were installed between 1997 and the project implementation date, the flows have been assessed holding the assumption of a simple 30 percent reduction in the road-based public transport line flows at the introduction of the new rail services. This assumption is justified by the fact that corridor-specific mode changes relate to corridors where new light rail transit (LRT) lines would be introduced, such as the LRT2 and LRT3 corridors. Hence, some reduction in bus or jeepney traffic is expected once the LRT lines becomes operational. The actual level of transfer onto the rail services will of course depend critically on interchange possibilities and convenience, and on fare levels and integration. This factor is slightly lower than the passenger transfers to LRT Line 1 observed on its opening, but reflects the potential for load factor reductions on existing services. The above assumptions remain relatively crude and ignore the possibility of trip generation with new schemes. Moreover, no allowance for trip redistribution was made because of the lack of local evidence. But the congested state of the network reduces the possibility of overestimation of traffic flows. Intersectfons A metrowide project (SMART) to replace all existing signal equipment and to install new signals is under way in Manila. This project will include optimization of the signal settings (including synchronization of some junctions) and will be completed by the end of 2000. SMART phasing has yet to be determined, but for the purposes of the evaluation it was assumed that signals would be installed and working optimally in the relevant corridors before the MMURTRIP actions are undertaken. Hence, benefits from the MMURTRIP project would be incremental and would depend on geometric improvement and improved management of intersections rather than improved signal timing. Where management improvements alone were involved, the evaluation depended on a demonstration that only very small per vehicle time savings would be required to achieve economic viability. Peak and Off-peak Periods Peak and off-peak periods were modeled separately where possible, as data was often available. Since the majority of traffic counts were for less than 24 hours, suitable factors were adopted to convert these to daily and annual values. Where benefits were deemed to accrue over the whole day, a factor of 1.3 was used to convert the 14-hour counts, obtained from the DPWH-Traffic Engineering Center, to average weekday flows. At intersections, the analysis of time savings was carried out for three distinct time periods: AM peak (four hours), PM peak (four hours) and inter-peak (six hours). Aggregate benefits were then accumulated over the same 14-hour period. Other components, such as pedestrian and public transport improvements, were also evaluated over this 14-hour period. In addition, an annualization factor of 330 was used to reflect the fact that most available traffic data relates to an average weekday, not an average day. Value of Time The Department of Public Works and Highways (DPWH) and the World Bank have different approaches to benefit estimation (particularly in the valuation of time). Rather than parallel appraisals for each project - 47 -  component, a simple comparison of the two evaluation methods was made. The assumptions of each methodology are discussed in detail in the relevant chapters of the MMUTIS study. The main differences between the two methodologies are the computation of vehicle operating costs, namely fuel and oil consumption, spare parts, and maintenance labor costs. Other differences concem vehicle occupancy factors, vehicle use characteristics, and the value of time. Another difference concems the factors used to estimate distribution of trip types: The DPWH model only considers work trips and commuting trips to have a value. However, World Bank practice is to assume that people place a value on all time spent traveling. Hence "leisure" trips are also included in the evaluation. Leisure trips include all nonwork and noncommute trips, for example, shopping, school, and church trips. This difference made the DPWH model and its coefficients less appropriate then the altematives adopted by the consultants for the application in an urban context. Therefore, in the evaluation the travel time savings included the valuation of business travel time, commuting travel time, and leisure travel time (table 4.2). Commuting and leisure time were valued at 50 percent of business time. Local evidence indicates that this seemingly high value is not unwarranted in the Manila context (the average normally used is 25 to 30 percent of work time). Table 4.2 Value of time (US$ and PhP per hour) Users Work time Commuting and leisure time US$ per hour PhP per hour US$ per hour PhP per hour Car drivers (nonprofessional) 1.77 52 0.89 26 Car passengers 1.64 48 0.82 24 High-occupancy vehicle/taxi 1.64 48 0.82 24 passengers Jeepney passengers 1.40 41 0.70 20.5 |Bus passengers 1.40 41 0.70 20.5 Note: US$1=PhP29.3 (1996) Other assumptions Additional assumptions were made for interest charges, GDP growth and project life. To reflect the current interest rate and assumptions about future movements,the evaluations assumed an interest rate of 15 percent throughout. This rate was based on the National Economic and Development Authority (NEDA) assumptions of the opportunity cost of capital. Real GDP per capita was assumed to increase by 2 percent per annum. The value of time was assumed to increase in line with the growth in per capita GDP. Project life assumptions vary according to component. Traffic engineering schemes were assumed to have a 5-year life, whilst most infrastructure was assumed to have a 20-year life. Bridges were assumed to have a 30-year life and asphalt road surfaces were assumed to need significant rehabilitation after seven years. Cost provisions were made for the bridge and asphalt roads assumptions where relevant. The evaluation excluded some nonquantifiable benefits, such as accident reduction or enhanced accessibility to particular development areas. This exclusion should preclude undervaluation of overall scheme benefits. - 48 -  Sensitivity analysis / Switching values of critical items: Methodology Approach. The MMURTRIP Study team developed a common framework for assessing costs and benefits. In many cases the "without projects" scenario would not be the same as the actual situation, because other actions were expected to occur before project implementation. Where this was the case, subcomponents were not assessed against a "do-nothing" situation but against the most likely prior situation. Nevertheless, the various components of the MMURTRIP project, each with a range of benefits, was complex to evaluate. For example, some benefits could not be quantified, and in many situations costs are so small that, given the large number of users of the facility, the benefits for each would only have to be very small (that is, 15 percent) to achieve a satisfactory economic intemal rate of return (EIRR). Therefore, the project components that have been evaluated are those in which evaluation was simple, costs are large, or benefits are not obviously very large. The main benefits stem from time savings rather than vehicle operating cost savings. On links between intersections, time savings were estimated with reference to changes in volume/capacity ratio (the extent to which proposed actions lead to increased road capacity). Time savings at intersections (or groups of intersections) were assessed using the TRANSYT suite of traffic signal design programs. Where relevant, or useful to understand the evaluations, a top-down approach was adopted by estimnating the number of vehicles that would generate enough savings to achieve a 15 percent rate of return. This approach is particularly useful where benefits are very high (for example, corridor improvements along the EDSA or LRT Line 2 corridors) or where development (or traffic generation and redistribution) is expected (for example, on the MARIPAS radial roads). The following section summarizes the evaluation of benefits of different typologies of project subcomponents. Application to Specific Scheme Types Improvements to bus stops and off-road jeepney and FX waiting areas. The purpose of these interventions is to improve waiting conditions for passengers at the roadside and to remove the people and stopping vehicles from the carriageway. This will improve traffic flow on the section of road and reduce the risk of accidents. Benefits are computed on the basis of the total number of passengers using the facility and the estimated value each of these passengers places on the improvement. The benefits also come from the increased traffic speed once pedestrians are removed from the road. The benefits are assessed on the basis of the time saving to vehicles resulting from increased road capacity and higher travel speeds, compared with the do-nothing altemative. Intersection improvements and bus priority schemes at intersections. The purpose of these components is to improve the flow of traffic through an intersection and reduce overall delay at the signals. The bus priority schemes are designed to use road space more efficiently, maximizing the passenger throughput of the intersection and ensuring the attractiveness of public transport. They will also reduce the time taken for public transport vehicles to traverse each intersection, compared with private vehicles. The benefits are estimated on the basis of the reduced delay to vehicles at the intersection. "With-project"travel delays at the intersections are estimated on the basis of TRANSYT simulations, with optimal signal timings. Co- - 49 -  ordination of adjacent signals is considered, where appropriate. The time savings are then converted into vehicle operating cost and occupant time savings using the Consultant's revised model. Where signal coordination is considered, scheme evaluation is performed at an "aggregate" level, over all the intersections involved. Where the junctions are not signalised, or where traffic enforcers are used, estimates of travel demand in the "without project case cannot be made reliably. In these cases, the top down approach is used. Sidewalk improvements, prohibition of on-street parking, and provision of off-street truck parking. The purpose of these components is to improve the flow of traffic by reducing the interaction between pedestrians or parked vehicles and moving vehicles. While at intersections it is assumed that these benefits are modeled in the optimized signal timings. Between intersections the benefits are derived from moving pedestrians off the carriageway and onto sidewalks, and moving car parking from the curbside lane. This is assumed to increase roadway capacity and increase average vehicle speeds. On-site observations have been used to estimate the extent of the road space that could be released by sidewalk improvements and prevention of parking. Benefits are assessed on the basis of the time saving to vehicles brought about by the increased road capacity and higher travel speeds, compared with the "do-nothing" alternative. Pedestrian bridges. Pedestrians currently cross many roads in Metro Manila at grade. This can be time consuming (as pedestrians are forced to wait for a safe gap in the traffic flow) and dangerous (since traffic and pedestrians are forced to share road space). MMURTRIP will to introduce some pedestrian bridges between intersections and near the Light Rail Transit stations. These will make crossing safer and eliminate the waiting. It is acknowledged that the actual crossing time for the pedestrian may be higher with the bridge, but the reduction in waiting time will outweigh this, especially on wide roads with high traffic flows. The benefits of the bridge are determined by the number of people crossing in the vicinity of the bridge site and the extent of their wait. Given average pedestrian bridge costs, a certain number of pedestrians is required to ensure that the internal rate of return on the project would be greater than 15 percent, at which point the project could be justified in economic terms. Other benefits will accrue to vehicular traffic that experiences less delay when pedestrians are removed from the roadway. Before deciding the to provide a pedestrian overbridge, alternative options have been explored such as signalised at-grade crossings, where the pedestrian signal timings are coordinated with those of upstream or downstream signalised intersections. These can often be more convenient to pedestrians, while not adding significantly to vehicle joumey times. However, in many cases the benefit to pedestrians will be outweighed by the disbenefit to public transport passengers. Exceptions to this rule include locations where public transport vehicles are stopped anyway (bus stops, jeepney terminals), and those close to major signalised intersections. Upgrading of existing roads - The purpose of these interventions is to improve the flow of traffic, reduce the wear and tear on vehicles and improve ride quality and passenger comfort. On most of the roads to be upgraded (e.g. secondary roads), there will be a variety of actions ranging from pavement rehabilitation to sidewalk and public transport improvements - in line with the overall MMIURTRIP objectives. The benefits therefore come from a combination of increased speed and reduced surface roughness (i.e. reduced operating costs). Benefits are assessed by comparing vehicle operating costs and time savings in the "with scheme"and "without scheme" situations. Savings in maintenance expenditure are estimated from average maintenance costs for different surface types and conditions provided by the DPWH Bureau of Maintenance. New road infrastructure. The purpose of these components is to provide missing links in the network, relieve alternative routes, and increase accessibility in the city. The benefits are estimated on the basis of reduced travel time (and operating costs) for the users of the route compared with those on the most direct - 50 -  alternative. There will also be benefits (for example, reduced congestion and travel time) for users who remain on the alternative routes. The time and vehicle operating cost savings are then used as the basis of the evaluation. Evaluation Summary of the LRT 2 Line Corridor To clarify the methodological approach used in the economic evaluation, this section outlines the detailed findings of the LRT2 Line Corridor. The section briefly spells out the evaluation approach and its inputs and presents the economic internal rate of return (EIRR) and net present value (NPV) figures for the component project, together with the benefit and cost streams. Approach. Benefits are derived from sidewalk improvements and intersection management improvements. The sidewalk improvements valued are only those along major roads in the corridor (Claro M.Recto, Legarda, R. Magsaysay and Aurora Boulevard) where extensive pedestrian infringement of the carriageway has been observed. Typically pedestrians do not impinge on the carriageway for more than about 100 meters in any one location, since they bunch around attractions such as bus stops or pedestrian bridges. The evaluation reflects this. Elsewhere sidewalk improvements are proposed to improve the quality of existing sidewalks or allow pedestrians to walk along the sidewalk rather than on frontage parking areas. Such improvements have no quantifiable benefits, although pedestrian safety will be enhanced and the general environmental improvements for pedestrians will also be important. Improvements to side roads are designed to allow better operation of the main intersections along the corridor or to allow for safe public transport interchange. However, for consistency, since traffic counts are not always available in these locations, none of these benefits was evaluated. With the existing traffic flows the corridor is at capacity, and no traffic growth was therefore assumed. This will tend to underestimate benefits because traffic generation or reassignment from other routes would be expected to accompany improved travel conditions in the corridor. Benefits from the sidewalk improvements were derived from a reduction in carriageway infringement and hence improved speeds for traffic through the road section involved. Benefits from the improved management of intersections were assessed from TRANSYT analysis of individual intersections, assuming that management actions will increase saturation flows by about 10 to 15 percent. Public transport priority measures are provided between C-3 and C-2 only. The project will be undertaken in two stages, relating to the opening of the LRT Line 2 project. Cubao to Katipunan projects will be constructed between July 2000 and June 2001 (opening in July 2001), and projects from Cubao to Recto will be built during 2001 and early 2002 (opening in April 2002). Benefits accrue from July 2001 for the Cubao to Katipunan section and from April 2002 for the Cubao to Recto section. No additional maintenance costs are incurred and the improvements are evaluated over five years. - 51 -  Results Table 4.3 outlines the summary of the economic evaluation and costs and benefit for the subcomponent. Table 4.3 Cost benefit analysis summary for the LRT 2 Corridor (PhP million undiscounted) Year Without With scheme Savings Total Net scheme VOC and Total cost economic VOC VOT VOC VOT VOC VOT VOT benefits ______ ______ ______ savings _ _ _ __ _ _ _ _ _ 2000 2.2 -2 2001 102.9 -103 2002 60.0 225.7 44.4 167.1 15.6 58.6 74.2 119.5 -45 2003 250.7 1608.8 172.9 737.2 77.8 331.6 409.4 409 2004 244.5 1283.5 167.4 878.6 77.1 404.9 482.0 482 2005 263.8 1288.2 180.5 881.4 83.3 406.8 490.1 490 2006 283.8 1292.8 194.1 884.1 89.7 408.7 498.4 498 2007 232.6 1059.8 133.0 605.7 99.7 454.1 553.8 554 2008 42.4 207.2 27.5 134.3 14.9 72.9 87.9 8 Summary NPV =980.8 EIRR= 142% Sensitivity Analysis A sensitivity analysis was performed to test the robustness of the results as well as the appropriateness of the approach. Again, given the different nature of the subcomponents and the complexity of some of them, the sensitivity tests were conducted only for those subcomponents in which the sensitivity analysis was simple to undertake, the costs are large, or the benefits are not obviously very large. The sensitivity test assumptions used were: - The subcomponent is implemented one year earlier. : The corridor is open one year later. *The costs are 10 percent higher than predicted. * The benefits total 10 percent less than expected (every year). The individual results for each of the sub-component analyzed are presented in the MMURTRIP Study. These results indicate in general a strong viability and confrm the correctness of the approach. Project Results The results of the cost benefit analysis (table 4.4) show in general high returns for each of the subcomponents and for the project as a whole. Whether considering VOC savings only, or combined VOC/VOT savings, the rate of return is well above the 15 percent threshold. World Bank experience with similar traffic management projects in other countries demonstrates that such projects consistently produce high returns because of the significant benefits, particularly in term of VOT savings, and that they generate with relatively small investmnents. - 52 -  Table 4.4 Economic evaluation summary Cost Cost Length EIRR EIRR NpVb Component (US$ m) (PhP m) (km) (VOC) (VOCI VOT (15%) .(percent) (percent) hP) A. Traffic Management Inprovement LRT Line 2 corridor 5.5 275 12 64 142 980.8 EDSA LRT Line 3 corridor 5.7 285 18 18 155 1,025.8 Bicutan interchange 0.6 30 n.a. 37 192 489.6 Alabang interchange 1.7 85 n.a. 56 119 407.5 B. MARIPAS Access Improvements Marikina Bridge and Access Road 23.3 1165 n.a. 4 19 808.8 Marcos Highway 19.7 985 4.6 22 162 5,575.6 Ortigas Avenue Extension 5.2 260 6.8 133 565 7,485.7 C. Secondary Roads Program: D. Romualdez 0.2 10 1.44 8 30 96.2 Legarda 0.2 10 0.97 63 117 27.2 Quezon Boulevard 0.2 10 1.28 135 243 428.8 Pasong Tamo 2.9 145 2.42 45 57 216.1 Pedro GilJNew Banaderos 1.9 95 5.17 180 288 409.8 Tayuman 0.9 45 1.37 39 41 68.3 M. de la Fuente (Trabajo) 0.1 5 2.14 n.a 15 30.5 Jacobo Fajardo 0.1 5 1.00 n.a. 15 2.4 SSHWest/East Service Road 7.3 365 27.2 95 II1 1,179.9 Quirino Highway 6.8 340 11.8 79 248 33,145.1 10th Avenue 1.1 55 2.83 47 58 16.7 Don Mariano Marcos Ave Extension 6.9 345 1.00 35 107 692.7 Antonio Arnaiz Avenue 1.0 50 2.01 n.a. 15 30.5 Sen.Gil Puyat Avenue 1.6 80 5.43 99 118 19.1 Banaue Avenue 1.5 75 3.00 n.a. 15 37.5 Project total 94.4 4720 69.1 37 137 53,145 a b n.a.= not applicable. Economic internal rate of return. Net present value. Note: Costs exchange rate is US$1 = PhP50 (2001) Note: The economic analysis was done excluding taxes. - 53 -  Annex 5: Financial Summary PHILIPPINES: Metro Manila Urban Transport Integration Project Year Ending December 31 United States Dollar (USD) million | Year 1| Year 2 | Year 3 | Year 4 | Year 5 | Year 6 | Year 7 Total Financing Required Project Costs Investment Costs 10.0 13.4 35.8 27.3 10.8 0.0 0.0 Recurrent Costs 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Project Costs 10.0 13.4 35.8 27.3 10.8 0.0 0.0 Front-end fee 0.6 0.0 0.0 0.0 0.0 0.0 0.0 Total Financing 10.6 13.4 35.8 27.3 10.8 0.0 0.0 Financing IBRD/IDA 0.8 10.5 21.4 19.5 7.8 0.0 0.0 Government 8.5 2.9 14.4 7.8 3.0 0.0 0.0 Co-financiers-GEF 1.3 0.0 0.0 0.0 0.0 0.0 0.0 Total Project Financing 10.6 13.4 35.8 27.3 10.8 0.0 0.0 Philippine Pesos (PhP) million Y Year I Year 2 Year 3 l Year 4 l Year 5 Year 6 Year 7 Total Financing Required Project Costs Investment Costs 500.0 670.0 1790.0 1365.0 540.0 0.0 0.0 Recurrent Costs 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Project Costs 500.0 670.0 1790.0 1365.0 540.0 0.0 0.0 Front-end fee 30.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Financing 530.0 670.0 1790.0 1365.0 540.0 0.0 0.0 Financing IBRD/IDA 40.0 525.0 1070.0 975.0 390.0 0.0 0.0 Government 425.0 145.0 720.0 390.0 150.0 0.0 0.0 Co-financiers-GEF 65.0 0.0 0.0 0.0 0.0 0.0 0.0 Total Project Financing 530.0 670.0 1790.0 1365.0 540.0 0.0 0.0 - 54 -  Annex 6: Procurement and Disbursement Arrangements PHILIPPINES: Metro Manila Urban Transport Integration Project Procurement Procurement of all works and goods under the project will follow the Guidelines-Procurement under IBRD Loans and IDA Credits published by the World Bank in January 1995, and revised January and August 1996, September 1997, and January 1999. Procurement of all services under the project will follow the Guidelines-Selection and Employment of Consultants by World Bank Borrowers published by the World Bank in January 1997 and revised September 1997 and January 1999. Procurement for the Global Environment Facility grant for the Non-Motorised Transport component is required to follow all World Bank procurement guidelines as above. Procurement will be undertaken by the project's implementing agencies as follows: - The Department of Public Works and Highways (DPWH)-Urban Roads Project Office (URPO). The DPWH-Traffic Engineering Center will manage procurement of one package of traffic signal equipment. e The Metropolitan Manila Development Authority (MMDA). * The City of Marikina Local Government Unit will undertake procurement for the Nonmotorised Transport, GEF- financed, component of the project. Summary of the Procurement Capacity Assessment. World Bank staff undertook a procurement assessment of the implementing agencies. The procurement assessment (see project files) was fully discussed and agreed with the agencies in May 2000. A MS Project-based procurement implementation schedule for the whole project was prepared by DPWH-URPO (see project files). Overall risk assessment for the project: average risk category. The Departmrent of Public Works and Highways (DPWHI-)-Urban Roads Project Office (URPO). The assessment found that the procurement capacity is in the average risk category. The results of the assessment indicated that although DPWH can be considered a professional organization in terms of executing projects funded by the World Bank, both URPO, and the Traffic Engineering Center (TEC), have only implemented limited World Bank projects before. They have implemented World Bank assisted projects, such as the Metro Manila Urban Transport Strategy Planning Project (MMUSTRAP) and the Metro Manila Urban Transportation Project (MMUTAP)-Phase I, and other foreign assisted projects, and therefore are not new to this business. For efficient implementation, the MMvIURTRIP project will need to strengthen the procurement functions in the URPO and TEC. Formal and hands-on training in World Bank procurement guidelines, policies, and procedures will be undertaken by the procurement staff of each of the units. It should be emphasized to all personnel involved that the procurement process to be followed for the project must be in accordance with the loan agreement, procurement side letter and World Bank procurement guidelines. The Metropolitan Manila Development Authority (MMDA). The assessment found that the procurement capacity is in the average risk category. The MMDA, which will be implementing a World Bank-funded project for the first time, has however implemented numerous locally funded traffic-related projects and is - 55 -  becoming involved in projects funded by other international funding institutions. Contracts presently implemented by the MMDA under Asian Development Bank and local financing are in the same cost range as those to be financed under the MMURTRIP project. Hence, in terms of contract amounts, MMDA staff should not have difficulty implementing this project. Based on the assessment, it is clear that the capacity of the MMDA to undertake procurement of the components of the MMURTRIP project requires formal and hands-on training in procurement guidelines. Overall, efficient implementation of the project will require strengthening of the procurement function in the MMDA. Such training has been started by the World Bank Manila office and will be facilitated by the appointment of a project advisor in the MMDA. The City of Marikina. The assessment found that the procurement capacity is in the average risk category. The performance of the city government has been satisfactory in the implementation of the two Global Envirorment Facility (GEF) grants for the project, and no difficulty is anticipated in procurement for the relatively small proposed Nonmotorised Transport component of US$1.4 million (the funding authority from GEF is US$1.26 million). The maximum contract that the city government has implemented amounted to about US$ 1.0 million. This amount is larger than the contracts expected for the project, so no difficulty is expected related to contract size in the implementation of the project. Conflicts between the procurement procedures of the Government of the Philippines and procedures acceptable to the World Bank Several such conflicts, related to national competitive bidding and procurement of consultant services, are fully addressed in the Supplemental Letter, Representations and Assurances on Procurement to the Loan Agreement, as well as in the Project Implementation Plan. The Borrower is required to conform with this agreement and waive all procedures unacceptable to the World Bank. The following procedures will apply to all goods and works contracts to be financed by the World Bank for the above-noted project following the Philippines National Competitive Bidding (NCB) procedures: a. National competitive bidding opportunities, including those which are invited by local government units, shall be advertised in national newspapers of general circulation, with sufficient time for bidders to prepare offers, which is normally 30 days, unless different venues and time are specifically agreed upon by the World Bank. b. Foreign suppliers and contractors from eligible countries will be allowed to participate, if interested, without first being required to associate or enter into a joint venture with local firms. c. Except for major or complex works, where prequalification is required, prequalification of contractors may be conducted upon prior concurrence of the World Bank. d. If any bidder is denied access to the bidding process for reasons unrelated to its financial and technical qualifications to perform the contract, the World Bank shall be consulted prior to such denial. e. Bid submission deadlines, times, and location specified in the bidding documents will be strictly adhered to; and bids submitted after the specified date and time and location shall be returned unopened to the bidder. f. The World Banks domestic or regional preferences will not be applied in the evaluation of bids, and other preferences in effect in the Philippines will not be used except with the prior concurrence of the World Bank. - 56 -  g. Bracketing and ceiling will not apply, unless specifically agreed by the World Bank in advance of bidding. h. Single responsive bids will not be rejected without prior World Bank concurrence, and rebidding will not be mandatorily required when fewer than three responsive bids are received. i. Bid opening shall be open to those who wish to attend; and the deadline for submission of bids should be the same as that for bid opening, or immediately thereafter. j. Suppliers and contractors will not be required to purchase local goods or supplies or to hire local labor, except unskilled labor. k. Explicit bid evaluation criteria will be set forth in the bid documents. 1. Material modifications of contract scope and conditions during implementation require prior World Bank concurrence. The Philippines further assures that, unless otherwise agreed to in writing by the World Bank, the following procedures will be adhered to in respect of the procurement of all works contracts to be financed by the World Bank for the MMURTRIP project and procured according to national competitive bidding procedures: a. Prior registration, licensing, and/or other Goverrment authorization will not be a requirement for purposes of participating in bidding competitions; such registration, licensing, and/or other Govemment authorization may, however, be required from the selected bidder as a prior condition to signing the contract. b. All contractors will be allowed to compete for contracts to the upper limit of their classification. The Philippines also assures that, unless otherwise agreed to in writing by the World Bank, the following procedures will be adhered to in respect of the procurement of consultant services to be fmanced by the World Bank for the MMURTRIP project: a. Mandatory joint venture or association with Philippine consulting firms will only be required if (i) there are sufficient number of capable domestic firms available to allow reasonable freedom of choice for the invited foreign firms; (ii) the desirable contribution by either firm will not be constrained by any prescribed manner or extent or participation; and (iii) association with specified named firms selected by the borrower will not be required. b. Qualified consulting firms that come to the attention of the agency requiring services by means other than a specific expression of interest in response to an announcement of a future project for consulting services will also be eligible for the shortlist. c. When circumstances warrant and with prior World Bank no objection, consulting firms may be asked to continue working on a project beyond the phase for which their services were originally contracted. d. Price adjustments in consultant contracts will remain in effect whether budgetary funds are available or not; in addition, there will be no ceiling on price adjustments under World Bank-financed contracts. - 57 -  e. The World Bank's Standard Formns of Contract for Consultants' Services for Complex Time-Based Assignments and for Lunp Sum Remuneration shall be used for contracts financed by the World Bank. f. The "percentage of construction" cost method will not be used to determine the compensation of World Bank-financed consultancy services. g. When consultancy services include the provision of vehicles, their origin shall not be restricted to Philippine sources. A General Procurement Notice will be updated annually in the Development Business. The first General Procurement Notice was published 30 April 2000 in Issue No 533. Specific Procurement Notices for Supervision Services were published 16 May 2000 in Issue No 534 and for Civil Works on 16 December 2000 in Issue No 548. Procurement methods (Table A) 1. Works: about US$64.20 million (PhP 3,210 million), including contingencies. Intemational competitive bidding (ICB) will be used for all civil works contracts greater than US$2.5 million equivalent per contract (about US$52.7 million including contingencies). National competitive bidding (NCB) may be used for works less than US$2.5 million equivalent per contract (approximately US$10.3 million for IBRD-funded works and US $1.4 million for GEF-funded works) where these are localized works of small value and unlikely to attract foreign contractors. Foreign contractors are, however, not excluded from participating. For two contracts below this US$2.5 million limit, ICB procedures will still apply as defined in the procurement assessment. The following works contract packages (table 1) will be procured under the project both by ICB and NCB procedures. * The DPWH-URPO will procure eight civil works packages (six ICB and two NCB packages) with a total value of about US$ 45.5 million (PhP 2275 million), plus DPWH-TEC will procure NCB packages for related signal installation with a total value of about US$ 3.9 rmillion (PhP 195 million), all equivalent to about 77 percent of the total value of all civil works components. * The MMDA will procure nine civil works packages (two ICB and seven NCB packages) with a total value of about US$ 13.7 rnillion (PhP 685 million), equivalent to about 21 percent of the total value of all civil works components. * The City of Marikina will procure five civil works packages (five NCB packages) with a total value of about US$1.2 million (PhP 60 million), equivalent to about 2 percent of the total value of all civil works components. The average contract size is expected to be about US$200,000 each for the contracts. The contracts are split up since they will be implemented at different times. World Bank Standard Bidding Documents will be used for all works contracts as follows: * The Procurement of Works document, January 1995, revised January 1999 and revised May 2000, applicable for contracts over US$10 mnillion, will be used for one ICB package, the Marikina Bridge and Access Road under the DPWH-URPO. * The Procurement of Works: Smaller Contracts document, January 1995, (with Corrigendum No. 1 - 58 -  to No. 4) will be used for all other ICB works. The same document will be used for all NCB works, modified for NCB use. * The Standard Bid Evaluation Form, Procurement Goods or Works, April 1996, will be used for all works. * The Standard Prequalification Document for Procurement of Works, September 1999 revised March 2000, will be applied for the one contract with prequalification. Prequalification will be used for one civil works contract, for Marikina Bridge and Access Road, since it is valued over US$ 10 million and considered complex because of the bridge construction involved. Postqualification will be applied for all other civil works contracts. 2. Goods: about US$6.40 million (PhP320 million), including contingencies. The following goods contract packages will be procured under the project: * The DPWH-URPO will procure vehicles with a total value of about US$ 100,000 and computer equipment with a total value of about US$50,000. These will be procured by National Shopping. * The MMDA will procure vehicles with a total value of about US$ 100,000 and computer equipment valued with a total value of about US$50,000. These will be procured by National Shopping. These above packages are not grouped since they will be procured by two independent implementing agencies. * The DPWH-TEC will procure traffic signal equipment under one contract with a total value of about US$5.9 million (PhP 295 million), under ICB procedures. World Bank Standard Bidding Documents will be used for the goods contracts as follows: * The World Bank's Standard Bidding Documents Supply and Installation of Equipment, November 1997, revised January 1999, will be used for the procurement of the traffic signal equipment. * The Standard Bid Evaluation Form, Procurement of Goods or Works, April 1996, will be used for all goods. 3. Services: about US$10.0 million (PhP 50 million), including contingencies. The following consultant services will be procured under the project: * The DPWH-URPO will procure four consultant services contracts with a total value of about US$ 6.1 million (PhP 305 million) under Quality-and-Cost-Based-Selection (QCBS) procedures. The consultants will be tasked with the following: 1. Construction supervision of DPWH-URPO components of phase I - Marikina Bridge and Access Road (ICB-3), Marcos Highway (ICB-4) Ortigas Avenue Extension (ICB-5) and D. Romualdez/Legarda/Quezon Boulevard (NCB-3). 2. Construction supervision of DPWH-URPO components of phase II - ICB-6, ICB-7, ICB-8, NCB-5. 3. Advisory services. 4. Detailed engineering design of phase II components. - 59 -  * The DPWH-TEC will procure one consultant service contract through sole-source selection for a lump sum amount not to exceed US$50,000. * The MMDA will procure three consultant services contracts with a total value of about US$ 1.6 million (PhP 60 million) under Quality and Cost-Based Selection (QCBS) procedures. The consultants will be tasked with the following: 1. Construction supervision of MMDA components of phase I - LRT Line 2 corridor (ICB-1); EDSA LRT 3 corridor (ICB-2), Pasong Tomo (NCB-4). 2. Construction supervision of MMDA components of phase II - NCB-1, NCB-2, NCB-6, NCB-7, NCB-8, NCB-9. 3. Advisory services. * The MMDA will procure consultant services for the Institution Building component with a total value of about US$1.1 million (PhP million) under Quality and Cost-Based Selection (QCBS) procedures and Selection of Individual consultant procedures. * The City of Marikina will procure consultant services contracts valued at about US$0.2 million (PhP 10 million) for the Nonmotorized Transport component. There is provision for recruitment of individual consultants or sole-source recruitment for the Nonmotorised Transport component. Four such consultants will be recruited under separate contracts ranging in value from US$50,000 to US$100,000, with a cumulative maximum of US$0.4 million. The selection of individual consultants will be based on their qualifications for the assignment (see section V of the Guidelines). Consultants may be selected on the basis of references or through comparison of the qualifications of people expressing interest in the assignment or approached directly by the borrower. Sole-source recruitment may be applied for tasks that represent a natural continuation of previous work carried out by the firn, or where only one fimn is qualified or has experience of exceptional worth for the assignment. The World Bank's standard documents will be used. * Standard Request for Proposals-Selection of Consultants, July 1997 and updated April 1998 and July 1999, will be used for all consultant contracts. All contracts above US$200,000 will be advertised in Development Business requesting expressions of interest prior to developing a shortlist. * Standard Sample Form of Evaluation report may be used for the evaluation of proposals at the Borrower's discretion. There is provision for single-source selection for contracts less than US$ 100,000, for tasks that represent a natural continuation of previous work carried out by the firrn, or where only one firm is qualified or has experience of exceptional worth for the assignment. 4. Project Management Office Engineering Overhead, Land Acquisition, and Operations and Maintenance: about US$16.4 million (PhP 820 million), including contingencies). About US$2.3 million (PhP 115 million) is allocated to cover the incremental Project Management Office engineering overhead operating costs related to managing the project, including staff travel and office utilities. These would be procured according to normal commercial procedures. Expenditures will be financed 100 percent by the Government of the Philippines. About US$13.5 million (PhP 675 million) is allocated to cover the cost of land acquisition. Land will be acquired for two project components and will be paid in accordance with the relevant Resettlement Action Plans. Expenditures will be financed 100 - 60 -  percent by the Government of the Philippines. About US$ 0.6 million (PhP 30 mnillion) is allocated to cover Operations and Maintenance expenditures incurred on infrastructure implemented under the project and incurred during the project implementation period. Expenditures will be financed 100 percent by the Govemrnment of the Philippines. Procurement arrangements for each of the components of the MMUTRTRIP project are given in table 6. 1. Table 6.1 Procurement arrangements and packaging (including contingencies) Package Contract package Local Cost Cost Implementing Procurement Ratio WB No. government (millions (millions unit method Review unit of US$) of PhP) involved 1. Works ICB-1 LRT 2 Corridor /a 3.3 MMDA ICB n.a. Prior _________ _______ Small Works /b ICB-2 LRT 3 Corridor /c 3.8 MMDA ICB n.a. Prior Small Works ICB-3 Marikina Bridge and Marikina 16.3 DPWH-URPO ICB n.a. Prior Access Roads Large Works /d _ ICB-4 Marcos Highway Marikina 8.2 DPWH-URPO ICB n.a. Prior Large Works ICB-5 Ortigas Avenue /e 2.2 DPWH-URPO ICB n.a. Prior Extension Small Works NCB-3 D. Romualdez/ Manila 0.4 DPWH-URPO NCB n.a. Prior Legarda/Quezon Blvd. Small Works NCB-4 Pasong Tamo Makati 1.5 MMDA NCB n.a. Prior Small Works NCB-1 Bicutan Paranaque 0.4 MMDA NCB n.a. Prior Small Works NCB-2 Alabang Muntinlupa 1.3 MMDA NCB n.a. Prior Small Works ICB-6 Pedro Gil/Tayuman/ Manila 2.3 DPWH-URPO ICB n.a. Prior M.dela Fuente/J. Small Works Fajardo ICB-7 South Super Highway /f 6.7 DPWH-URPO ICB n.a. Prior ______ _______ Small Works ICB-8 Quirino Highway Quezon 5.3 DPWH-URPO ICB n.a. Prior Small Works NCB-5 10th Avenue Caloocan 1.0 DPWH-URPO NCB n.a. Prior Small Works NCB-6 Don Mariano Marcos Quezon 0.5 MMDA NCB n.a. Prior Avenue Extension Small Works NCB-7 Antonio Arnaiz Makati 0.6 MMDA NCB n.a. Prior Small Works NCB-8 Gil Puyat Makati 1.1 MMDA NCB n.a. Prior Small Works NCB-9 Banawe Quezon 0.8 MMDA NCB n.a. Prior Small Works 6 NCB s Nonmotorized 1.0 City of NCB n.a. Prior Transport Marikina Small Works I Total works 64.2 3210 . - 61 -  2. Goods ICB-9 Traffic signal 5.9 DPWH-TEC ICB-SIPE n.a. Prior equipment NS-1 Vehicles 0.1 DPWH-URPO National n.a. Post Shopping NS-2 Computers 0.05 DPWH-URPO National n.a. Post Shopping NS-3 Vehicles 0.1 MMDA National n.a. Post Shopping NS-4 Computers 0.05 MMDA National n.a. Post Shopping Subtotal 6.4 320 3. Services CS-IA Construction x DPWH-URPO QCBS /g 80/20 Prior supervision phase I CS-IB Construction x MMDA QCBS 80/20 Prior supervision phase I DE-II Detailed engineering 1.5 DPWH-URPO QCBS 80/20 Prior phase 11 CS-IIA Construction x DPWH-URPO QCBS 80/20 Prior supervision phase 11 CS-IIB Construction x MMDA QCBS 80/20 Prior | tsupervision phase 11 _ l AS-A Advisory services - 1.2 DPWH-UJRPO QCBS 80/20 Prior DPWH L_I AS-B Advisory services - 0.4 MMDA QCBS 80/20 Prior MMDA Various Institution building 1.0 MMDA QCBSI n.a. Prior -MMDA Individual Con. Various Nonmotorized 0.4 City of QCBS/ n.a. Prior transport l_ l_l_Marikina Individual Con. SubTotal 10.0 500 4. PMO engineering 16.4 820 overhead; land acquisition 5. Front-end Fee 0.60 30 |_____ |Grand total cost 97.6 4880 Note: n.a. = not applicable. /a Local Government Units covered include Manila, San Juan, and Quezon City /b Small works refers to Smaller Contracts in the World Bank Standard Bidding Documents for Procurement of Works. /c Local Government Units covered include Quezon City, San Juan, Mandaluyong, and Makati /d Large Works refers to World Bank Standard Bidding Documents for Procurement of Works (used for contracts estimated to cost US$10 million and over). /e Local Government Units covered include Pasig, Cainta, and Taytay. /f Local Government Units covered include Pasay, Paranaque, and Muntinlupa. /g QCBS refers to the World Bank's Quality-and Cost-Based Selection procedures for selection of consultants. - 62 -  Annex 6 METRO MANILA URBAN TRANSPORT INTEGRATION PROJECT (MMURTRIP) Procurement Implementation Schedule ID Task Name Duratb.n Start A|M|J J JAIS |O|NFIMIJ MA IJJAS JOIN|D|J |FMA|MJ JA IS |OINID|J IF |MIA|M|J JAS ON D IJ IFIMIAIMIJ J AsoNDJFMA JASONJ F I DPWH 2107 days Thu 4127100 2 Detailed Design, Phase I 484 days Mon 6/5/00 rI 3 Construction Supervision, Phase I . 1673 days Thu 4/27/00 4 Advisory Services (DE and Monitoring) 2107 days Thu 4/27/00 - = 5 Marikina Bridge and Access Road 1644 days Fri 5/26/00 6 Marcos Highway (Katipunan Avenue to Masinag) 922 days Thu 1/17/02 7 Ortigas Avenue Extension (C-5 to Tikling) 1021 days Thu 11/23/00 * *** -*** __ 8 Legarda/Quezon Blvd./D. Romualdez 555 days Thu 11/23/00 0 Detailed Design, Phase II 636 days Mon 4/2/01 10 Construction Supervision, Phase II 1041 days Thu 1/2/03 ' 11 Quirino Highway 798 days Tue 6/24/03 12 SSH West/East Service Roads 805 days Tue 8/26/03 13 P. Gil/Panaderos, M. dela Fuente, J. Fajardo, Tayuman 615 days Tue 11/25/03 14 10th Ave. 616 days Mon 10/27/03 15 Traffic Signalization (DPWH) 1912 days Thu 9/7/00 16 MMDA .1280 days Sun 7/1/01 17 Construction Supervision, Phase I 1072 days Sun 7/1/01 L , N N K_ 18 Don Marano Marcos Avenue 523 days Wed 1/1/03 19 LRT Line 2 Corridor 708 days Mon 4/1/02 20 EDSA Corridor 708 days Tue 1/1/02 21 Pasong Tamo . 485 days Sat 8/4/01 22 Construction Supervision, Phase II 809 days Tue 10/15/02 . . 'J . _ 23 Bicutan 523 days Tue 10/1/02 24 Alabang 708 days Fri 1/24/03 25 Banaue 523 days Tue 10/1/02 20 Antonio Amaiz 708 days Wed 1/1/03 27 Gil Puyat 708 days Wed 1/1/03 Proejel Projectl CQI Work.s Cossutanscy ~ Procurement Date. Wed 5123/01  Table A: Project Costs by Procurement Arrangements (US$ million equivalent) Expenditure category . EX iProcuremnit Method Wor k;s00gory ICBa NCB ; OtherT N.B.F. Total Cost 1. Works 52.70 10.30 0.00 1.20 64.20 (37.10) (7.40) (0.00) (0.00) (44.50) 2. Goods 5.90 0.00 0.40 0.10 6.40 (5.90) (0.00) (0.30) (0.00) (6.20) 3. Services 0.00 0.00 9.80 0.20 10.00 (0.00) (0.00) (8.70) (0.00) 8.70) 4. Project Management Office 0.00 0.00 16.40 0.00 16.40 Engineering Overhead; Land (0.00) (0.00) (0.00) (0.00) (0.00) Acquisition; Operations & Maintenance 5. Front-end fee 0.00 0.00 0.60 0.00 0.60 (0.00) (0.00) (0.60) (0.00) (0.60) Total 58.60 10.30 27.20 1.50 97.60 (43.00) (7.40) (9.60) (0.00) (60.00) " Figures in parenthesis are the amounts to be financed by the Bank Loan. All costs include contingencies. 2 Includes civil works and goods to be procured through national shopping, consulting services, services of contracted staff of the project management office, training, technical assistance services, and (i) incremental operating costs of the project management offices related to managing the project of about US$ 2.3 million, (ii) land acquisition costs of about US$ 13.5 million and (iii) operations and maintenance costs of about US$ 0.6 million. N.B.F = Non-Bank Financed NMT component of US$ 1.5 million with GEF financing of USS 1.3 million equivalent. The GEF financing will be World Bank-Executed. - 64 -  Table Al: Consultant Selection Arrangements (optional) (US$ million equivalent) Selection Method Consultant Services Expenditure Category I QOBS QaS SFB LCS CQ Other N.BS.F. otl Cost' A. Firms 9.80 0.00 0.00 0.00 0.00 0.00 0.00 9.80 (8.70) (0.00) (0.00) (0.00) (0.00) (0.00) (0.00) (8.70) B. Individuals 0.00 0.00 0.00 0.00 0.00 0.00 0.20 0.20 (0.00) (0.00) (0.00) (0.00) (0.00) (0.00) (0.00) (0.00) Total 9.80 0.00 0.00 0.00 0.00 0.00 0.20 10.00 _ (8.70) (0.00) (0.00) (0.00) (0.00) (0.00) (0.00) (8.70) 1\ Including contingencies Note: QCBS = Quality- and Cost-Based Selection QBS = Quality-based Selection SFB = Selection under a Fixed Budget LCS = Least-Cost Selection CQ = Selection Based on Consultants' Qualifications Other = Selection of individual consultants (per Section V of Consultants Guidelines), Commercial Practices, etc. N.B.F = Non-Bank Financed NMT component of US$ 1.5 million with GEF financing of US$ 1.3 million equivalent. The GEF financing will be World Bank-Executed. N.B.F. = Not Bank-financed Figures in parenthesis are the amounts to be financed by the Bank Loan. Prior review thresholds (Table B) 1. Works. Each civil works contract will be subject to the World Bank's prior review. Prior review for works will cover 100 percent of the combined value of works. Prior review of civil works includes bidding documents including detailed designs, cost estimates and technical specifications, evaluation reports, and draft contracts. 2. Goods. Each goods contract of more than USS 200,000 equivalent per contract will be subject to the World Bank's prior review. This will involve the review of one contract, namely that for traffic signal equipment. Prior review for goods will cover 95 percent of the combined value of goods. Prior review of goods includes bidding documents, evaluation reports, and draft contracts. There will be no prior review of the contracts for vehicles and computer equipment. 3. Services. Each consultant contract of more than US$50,000 equivalent per consultant contract and estimated to total about US$9.8 million equivalent, and each contract of firns more than US$200,000 equivalent per contract and estimated to total US$0.2 million will be subject to the World Bank's prior review. All terms of reference, request for proposals, shortlist, evaluation reports, draft negotiated contracts, sole-source contracts, contracts of a special nature for consultant services, and final contracts with substantial differences to the original draft will be subject to prior review. - 65 -  Table B: Thresholds for Procurement Methods and Prior Review :Con7 7 f ftractValue;f 7001Contft4 s ubject to ::0: ;0Thresh tld ) 000X: Procurement Prior Review I Expenditre Cateor US j U(thouands) Method0*l000 ..0 (USS m