republic of indonesia ministry of · pdf file(in accordance to rkl / rpl if andal is required)...

REPUBLIC OF INDONESIA

MINISTRY OF SETTLEMENTS AND REGIONAL INFRASTRUCTUREDIRECTORATE GENERAL OF URBAN AND RURAL DEVELOPMENT

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP)Japanese Grant No. T F 026836 through IBRD

E864

,URBAN,,-,-'SEOOMENTREFO ~ J

January 2004

Prepared by:

, Departemen Pemuldman dan Prasarna WilayahDfr etorat Jenderal Tau Perkoraan dan Tzta Prdesdan

Departemen KeuanBan Republik Indonesia

. fBdan Perencanaan Pembangunan Na lont F C O P YDepartemen Dailam NegertRepubhk Indonesa (Depdagnr B __ r p ;

PT. Kmr1dka Pruddptapr(sma

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URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP) Safeguard Framework for USDRPJapanese Grant No. T F 026836 through IBRD

Abbreviations and Acronyms

AC Appraisal Committee at Central Level to decide on eligibility of proposedULG subprojects based on the stipulations of KMK 35/2003

AMDAL (Analisis Mengenai Dampak Lingkungan) General Framework for Envi-ronmental Assessment (typically comprises ANDAL & RKL / RPL)

ANDAL (Analisis Dampak Lingkungan) Comprehensive EAAPBD Annual Local Government BudgetBapedalda Environmental Impact Management Agency - Local LevelBupati Head of (Kabupaten) DistrictDAU Block Grant from Central Government to Local GovernmentsDinas Line Department within a Local GovernmentDPRD Local Council of a Kabupaten or a KotaEA Environmental AssessmentEMP Environmental Management Plan

(in accordance to RKL / RPL if ANDAL is required)GOI Government of IndonesiaIUIDP Integrated Urban Infrastructure Development ProjectKabupaten DistrictKelurahan Sub-district LevelKota MunicipalityKIMPRASWIL Ministry of Settlements and Regional InfrastructureKMK 35/2003 Ministerial Degree No 35 of 2003 to regulate On-lending and On-granting

Conditions of Donor LoansLARAP Land Acquisition and Resettlement PlanMusbangkel (Kelurahan) Sub-district Level Development Dialog -- a forum where in-

terests and aspirations of citizens who live within a kelurahan are dis-cussed and noted;

Musbangkot City Level Development Dialog -- interests and aspirations from each ke-lurahan are discussed further to formulate a city-level developmentagenda

NGO Non-Governmental OrganizationNMC National Management ConsultantNOL No Objection LetterPAP Potentially Affected PeoplePJM (Program Jangka Menengah) 5-year Development Plan at Local Gov-

ernment LevelRakorbang (Rapat Koordinasi Pembangunan) Development Coordination Meeting -

a forum where city-level development agenda is discussed / synchro-nized with the available funds and medium-term development strategy(PJM)

RKL / RPL (Rencana Pengelolaan Lingkungan /Rencana Pemantauan Lingkungan)

1-IAI AftAAN i


Environmental Management Plan / Environmental Monitoring Plan as anintegrated part of ANDAL

SK (Surat Keputusan) ULG Degree, issued by Walikota or BupatiSF Stakeholders ForumSOT Safeguard Oversight TeamUIDF Urban Institutional Development FacilityUKL / UPL (Upaya Pengelolaan Lingkungan / Upaya Pemantauan Lingkungan) En-

vironmental Management Proposal / Environmental Monitoring Proposal,or simplified EMP, for subprojects that do not require ANDAL

ULG Urban Local DevelopmentUSDRP Urban Sector Development Reform ProgramWalikota Mayor of a (Kota) MunicipalityWB World Bank

HAI AMAN ii


Table of Content

1. Introduction: Nature of the USDRP Program and Subprojects ................ 1

2. USDRP Project Cycle: An Overview .................................................... 2

3. Environmental Framework .................................................. 43.1. Basic Principles .................................................... 43.2. Subproject Category .................................................... 53.3. Content of EA Report .................................................... 63.4. EA and EMP Procedures and Public Consultation ......................... 8

4. Land Acquisition and Resettlement Framework . ..................................... 114.1. Basic Principles ................................................... 114.2. Thresholds ................................................... 124.3. Procedures of Land Acquisition and Public Consultation ........... 13

5. Function and Responsibilities of Institutions Involved . . 165.1. Involved Agencies at Local Level ................................................... 165.2. Involved Agencies at National Level .............................................. 175.3. Institutional Arrangement .................................................... 17

6. Legal Consideration ................................................... 19

Table of Annex

Annex 1: Project Type Map

Annex 2: USDRP Safeguard OrganizationAnnex 3: Type of Sector and Project Scale that require EA or EMP

I WlA ARAAMI iii


1. Introduction: Nature of the USDRP Program and SubprojectsThe objective of the Urban Sector Development Reform Program (USDRP, or "theproject") is to support local governments in their efforts to alleviate poverty, tostimulate the development of local/regional economy, and to improve the deliveryof sustainable and demand-driven urban services. The ultimate goal of these ef-forts is to improve the living quality of the urban population. To be able to achievethese objectives the project will ensure that participating urban local governments(ULGs):

A. select prioritized investments for infrastructure development that arebased on an agreed long-term development strategy and mediumterm development plan (PJM);

B. engage in governance reforms that foster participation, transpar-ency, and accountability as well as internal management reforms fo-cusing on procurement of goods and services and financial man-agement;

C. develop institutional and regulatory capacity for better delivery of ur-ban services;

D. determine and implements priority investments in both a participa-tory and accountable way.

USDRP is responding to the needs under a decentralized and democratic envi-ronment of the civil society. USDRP is building on the approach used to be takenby other urban development projects, such as the prominent IUIDP (IntegratedUrban Infrastructure Development Program), where investment in infrastructurewas a primary objective. However, USDRP views urban development in a morecomprehensive way, therefore investment in infrastructure is only one part of abroad-based development approach. Other strategic elements include the estab-lishment and implementation of comprehensive governance reforms and im-provement of the delivery capacity for public service of participating ULGs.The USDRP is encouraging the participating ULG to identify subprojects throughan "open menu"' approach. To satisfy the entire needs for urban developmentparticipating ULGs have the opportunity to invest without sector specific limita-tions. The main investment sectors concerned comprise: public works, transpor-tation, education and health. The process of identification and selection of sub-projects needs to be conducted in a participatory way, involving local government,council, and the stakeholders forum (SF) 2,

Consistent to this approach USDRP does not determine a ceiling amount for aproposed subproject. However, the proposed subprojects should be socially, en-vironmentally, and economically viable and in line with an approved medium termdevelopment plan (PJM). The total amount of money borrowed by the participat-ing ULGs depends upon their financial capacities.

1 Annex 1 is an indicative list of possible subprojects that are eligible for USDRP finance

2 See section 2.2 C Institutional Arrangement

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The object of this USDRP safeguard framework is to provide for all parties in-volved a common platform in analyzing, planning, implementing, operating andmonitoring potential subprojects in line with Bank requirements and the prevailingIndonesian laws on environmental impacts and land acquisition. The safeguardframework should help participating ULGs ensuring a systematic evaluation ofsubprojects against environmental and social risks; to reduce and manage ad-verse risks; to promote environmental and social benefits; and to ensure full dis-closure and meaningful consultation with affected people.USDRP related investment will only be carried out in urbanized area and will notenter into protected areas, or critical natural habitats, to avoid the application ofsafeguards for indigenous people. Therefore, USDRP framework consist of twomain parts only: Chapter 3 contains the guidance for required environmental as-sessment; and Chapter 4 contains the guidance for land acquisition and resettle-ment plan (LARAP). Hence, all submitted subproject proposals shall meet thoserequirements set forth hereinafter.

This safeguard framework is part of the loan negotiation documents and should,therefore, have been agreed by all participating ULGs prior to loan negotiations.In the event that selected investment projects were identified before the negotia-tion, the negotiation documents should include the necessary safeguard simpleplan (environment, and/or land acquisition action plan). Serious violation of re-quirements will intercept the program for those investment projects that do notconform to this framework.

2. USDRP Project Cycle: An OverviewThe following overview is a generic, and in a way idealistic, illustration of requiredsub-project development steps and their interaction within three mainstream ac-tivities, namely: (i) routing budget planning approach of Indonesian ULGs, (ii)technical stages required in sub-project development, and (iii) safeguard meas-ures and activities. Participating USDRP ULGs are requested to consider thestaging and elements of this overview as a minimum requirement for subprojectpreparation.

The approach applies for single, as well as multiyear investment projects. Thesignificance is that the concerned ULG needs to allocate adequate counterpartbudgets for each fiscal year individually, even though prior endorsement wasgiven by the local government assembly for the construction of a multi-yearsubproject. To secure the allocation of local counterpart funds it is required for theULG to enter into a MOU with the local council (DPRD).

With regard to budget allocation for safeguard requirements, the following shouldbe noted that budgets for the preparation of EA and EMP and/or LARAP shouldbe allocated simultaneously with the budget for project planning and design, eitherthrough the local budget (APBD) or the USDRP specific UIDF, which is providinggrants for project preparation. These budgets are typically allocated one yearprior to investment. Budgets for monitoring and implementation of the manage-

LJAI ARAAKI )


ment plan should be allocated in the local budget during the implementationstage.

Table 1: USDRP Project Planning Cycle

~~~~~~~~~~~~~~~~~.... .. ...... ... ....... ... ..... ... . .. ... ... .. . ......... . ...... ... .... .................... .................

Safeguard IssuesMonths ULG Budget Subproject - . . .

Planning Process Development Stages Environmental Land Acquisition andAspects t) Social Aspects

............................................. ............ . ........... ............. .. .. .... .. .... .. ...... .................. .... ..... .... ........ .... .. .......... ............ ....... . ..... .... ... ....I.......... .. .. .. .... .......... ..... .. .. ....... ......

.. .......... ...... ...... ......................... . .............. ........ ............. ................. .. .... ................. .. ............... ... .... . ............ .. ...... ................ ..........I.. ........ .... ...........-... ..... .......... .......... .......... . .......... ..... ......... . ...........

February Dinas prepares their ULG establishes EA Committee is established at each governmentbudget proposals USDRP project imple- level (ULG, Province, Central) prior to commence-

mentation units (PIU) ment of USDRP activities. Initial environmental im-pacts screening of subproject proposals may be con-ducted by the Proponent, EA Committee, orBapedalda;

Safeguards Oversight Team (SOT) is established ateach ULG level

March Musbangkel Proponent (Dinas) syn-chronizes PJM and theirsubproject proposals -the output is a list ofpriority

List of subprojects prior-ity has been developed

May ULG conducts Ra- Subprojects that will be Proponent starts preparing safeguard study:korbang to discuss, :financed through : (1) TOR for EA and submits it to relevant EA Commit-formulate, and syn- I USDRP, or other S tee**) and the Bank; and (2) LARAP (if required) andchronize proposed :sources, have been z starts consultation with the PAP (if required)subprojects with PJM determined..and to estimate . Proponent conducts.budget availability feasibility study (FS)

Submit FS, request EA Committee and the Bank approve TOR for EAsubproject approval and and/or the Bank approves TOR for LARAPsubproject finance to -------.Appraisal Committee Proponent prepares draft Proponent prepares(AC) EA & EMP draft LARAP

October Information on DAU ULG mobilizes consult- iProponent finalizes(central government ants to prepare DED & consultation with thegrant to local govern- tender documents PAPment)

... ........ ._, ................... ......... .... .... ........ ... '' .......... ...... '' ....... ..... .. .. .. .. . ... ...... .. ............ ....... ..... .. .. .... '..... .

Nov./ Budget approval Final EA and EMP are Head of ULG issuesDec. ,i , i approved by EA Commit- decree (SK) and asks

tee and the Bank for approval from theBank~~~~~~~~~~~~~~~~~~~..... .. ..... ... ...... .. ..... .... ..... .. ...... ... .. ........ . ........... ..... .. ........ .. .... .............. ............... ........... ....... ................. ......... ........................ ..... .... .. ................. .

Prepare USDRP project Implement LARAP andbudgets compensate PAP

....................................... .. .... ..... . ...................... .... ............. ........... .. .. ........ .. ......... .........- .. .. .... .. ... .. ..... ......... . ............ .......... .... .. ........ ......-. ......... ............ ............. .. .

Tender out and imple- Proponent implements EMP - manage and monitorment works environmental issue. Safeguard Team (SOT) over-

sees the implementation of EMP and conducts envi-ronmental monitoring

........................ ....- ...................................... . ..................................... ......................................................... .............. .... .... ... .... ...... ... ...... .... ....

*) Limited to EA and EMP

*) Depending on the type of environmental impacts approval are required from local, provincial or nationallevel

I I-i AiAtA 'A


For harmonization the terms related to the Bank's safeguards and the Indonesianrequirements, with regard to environmental issues, the following illustration isgiven:

HARMONIZING TERMS USED IN THE BANK'S OPERATIONAL POLICIES ANDTHE INDONESIAN REGULATIONS

ENVIRONMENTAL IMPACT

|-,- tSEViR(|. Jt LIMITED l

A<,}.4 ,.;E;;> | -- ELIP.. | MorSOP

seu2.n | xM NDtL UKL / UPL

3. Environmental Framework

3.1. Basic Principles

Principles of the Environmental Assessment (EA) and Environmental Manage-ment Plan (EMP) are outlined below. Consequently, any proposed ULG subpro-ject conforms to, and ensures, the recognition of these principles.

A. EA/EMP should be viewed as a quality enhancement tool. As such,it is recommended that the EA/EMP forms an integrated part to-gether with technical, economic, social, institutional, and financialanalysis of any proposed subproject.

B. USDRP will not support any investment that will create significantadverse and irreversible environmental impacts beyond the capacityof the concerned ULGs to manage.

C. As far as possible, subprojects should avoid, or minimize, negativeimpacts on the environment. Design alternatives, including non-project alternative, should be studied thoroughly before any subpro-ject is submitted. Accordingly, subprojects should be designed tomaximize positive impacts.

D. Subprojects that may cause negative impacts to the environment,and those impacts could not be mitigated through design and con-struction practices, should be accompanied by a comprehensive EA

H HAI AMAN a


and EMP.

E. There will be no subprojects under USDRP that affect any criticalnatural habitat, indigenous people, protected areas, or the forestrysector. Additionally, the project will not finance components and/oritems that are listed in the following table:

Table 2: USDRP Negative List

No. Components and/or Substances that will not be financed by USDRP1. Construction of Dams

2. Purchase of Pesticides

3. Purchase of Herbicides

4. Purchase of Asbestos, including for roof5. Subprojects and/or substances that produce hazardous waste3

6. Subprojects and/or substances that cause ozone depletion

F. Environmental studies and mitigation plans may be produced in theform of: (i) comprehensive EA (ANDAL) in combination with EMP(Environmental Management Plan), or (ii) simplified EMP only, de-pending on impact category of the concerned subproject (see belowlist of Categories). The selection of the environmental category foreach subproject is determined through the application of criteria set-forth in this framework.

G. For practical reasons it is suggested that first-year investmentsubprojects that are proposed by any participating ULGs should nottrigger the elaboration of a comprehensive EA. Such subprojectsmay be included in the second year of USDRP implementation, orthereafter.

3.2. Subproject Category

A. This environmental safeguard applies during all stages of develop-ment, i.e.: subproject proposal, planning, implementation, andoperation. Each subproject will be scrutinized against screeningcriteria set forth in the National regulation and operational policies ofthe Bank. According to Operational Policies 4.01 of the Bank, anyUSDRP subproject could be categorized into one of the followingthree categories. Equivalent categorization based on National regu-

Hazardous waste is the residue of works and/or activities which contains substances that, because of its number and/orconcentration and/or characteristics, directly and/or indirectly, may generate pollution and/or destroy / contaminate theenvironment, health, and/or sustainability of human-being and other creatures. For details see: Government Regulation(PP) 18/1999 conceming 'Management of Hazardous Waste', Article 1 (2). Exception: hospital may be allowed to befinanced with a condition that its wastes will be treated first before being dumped.

I HAI AMAN F;


lation is also shown in the table.

Table 3: Category of Subprojects

Category Impacts Bank GOIRequirement Requirement

A Subprojects are characterized creating Comprehensive Comprehensive EAsignificant adverse environment impacts, EA and EMP (ANDAL) and EMPwith regard to sensitivity, diversity, irre- (RKL/RPL) *)versibility, and/or unprecedented impacts.

B Subprojects are characterized being small Simplified EA, Simplified EMPin volume and size, implying reversible and EMP or (UKL/UPL)environmental impacts. EMP only *)

C Subprojects do not comprise construction No EA required No EA required.works, and do not cause air, soil and watercontamination.

*) see Annex 3, attached: Decree of the State Minister of the Environment No. 17/2001 concerning Types ofActivities which should be accompanied by EA; and decree of the Minister of Settlement and Regional Infra-structure no. 17/KPTSIMI2003 concerning activities in the field of Settlement and Regional Infrastructurewhich should be accompanied by an EMP

B. Law no. 23/1997 concerning Environmental Management, Article15(1) states that any plan of activity or work that possibly createslarge and significant environmental impacts must be accompaniedby an EA. Government Regulation (Peraturan Pemerintah, or PP)no. 27/1999 concerning EA, Article 5(1) furthermore elaborates crite-ria of large and significant impacts that include: (i) influence a largenumber of people, area, and environmental components; (ii) impactsare intense, occur during a long period of time, they are cumulative,and irreversible.

3.3. Content of EA Report

The following is a listing of items that should be included in any subprojectanalysis and report. More detailed outline on EA and EMP preparation isdescribed in the Project Implementation Plan (PIP) document.

A. Contents of a comprehensive EA report should include, as aminimum requirement, the following sections:

MAI ARAAMI r


(1) Executive summary(2) Policy, legal, institutional, and administrative framework(3) Baseline data with regard to the municipality, project environ-

ment and subproject(4) Detailed technical subproject description(5) Benefit analysis and technical risk assessment during

construction and operation(6) Environmental and social impact assessment, including indirect

and cumulative impacts(7) Analysis of alternatives, including non-project alternatives(8) Process of public consultations and summary of achieved re-

sults(9) Appendices of supporting subproject documents

The extent, depth, and type of analysis depend on the nature, scale, andpotential environmental impact of the proposed subproject. The proponentevaluates and the EA committee approves a subproject's potential envi-ronmental risks and impacts, examines subproject alternatives, identifiesways of improving subproject selection, location, planning, design, and im-plementation by preventing, minimizing, mitigating, or compensating for ad-verse environmental impacts and enhancing positive impacts.

B. Contents of an EMP report should include, as a minimum re-quirement, the following sections:

(1) Executive summary(2) Environmental Management Plan

* Environmental Impacts and their Sources: environmentalcomponents that may be affected, sources of impacts, andindicators of impacts

. Management plan and mitigating measures during pre-construction, construction and operation periods: actions,locations and periods of mitigation.

(3) Institutional arrangement: responsible agencies, and report-ing relationship* Budget and schedule

(3) Environmental Monitoring Plan* Monitoring plan during pre-construction, construction and

operation periods: action, time and methods, and location* Institutional arrangement: responsible agencies, and re-

porting relationship* Budget and schedule

EMP should describe a set of mitigation, monitoring, and institutionalmeasures that need to be exercised during implementation and operationof the subproject to eliminate adverse environmental and social impacts,offset them, or reduce them to acceptable levels. Most important is to allo-

1 WAI AAANI 7


cate clear and adequate interfaces of responsibilities to the institutions andstakeholders involved.

3.4. EA and EMP Procedures and Public ConsultationProponents need to work closely together with the potentially affected people(PAP) and need to coordinate with the EA committee for following essential steps:

(i) decision to determine appropriate subproject category and selection ofadequate safeguard requirements (as illustrated in Table 3 above),

(ii) preparation and approval of TOR for the preparation of adequate safe-guards documents, and

(iii) preparation and approval of safeguard documentsThe following figure is illustrating the procedures involved to implement environ-mental assessments and management documents. Figure 1 should be read asan integrated part of the subproject cycle, as illustrated in Section 2 of this frame-work.

Figure 1: Procedures of AMDAL

I HALAMAN 8

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USORP) Safeguard Framework for USDRPJapanese Grant No. T F 026836 through IBRD

Proponent (i.e Dinas, or line departmentwithin the local government) to propose

subprojects

teNo EA sCslegficant environ-Screening for mental impact bySimple EMP .< _(UKL /UPL Rvise_

_ raf Revise TOEA required

Approval' ~ ~ ~ rpoet.mybefciiatdb

prop6nent to submit TOR | relevano EA Conmmittee.otsctileen-ufl ~~~~~~~~~~t t relevant EA Commita taeeh')ders Forurr and ,PAP

Proponent to submit draft X Ys

to relevant EA Committee N CApro ov

Yesr YesProponent lo ubmit e rant EA Proponend. may bed acimaled by

(UKLIP) ~ (ANsDAL I S Et.P (RKL'RPL) to _ relevaril EA CommiHee. lo consult\App relevant EA Committee Stakehoers Forum ana PAP

No

Propoedadato reports the impnlemnr

QYes law,on of EMP ana the consuct ofenvironmnental morleastrng to

Proponent to implement EMP * ExA cq NMICand to conduct environmental * Bapedalda

monitoring Govemor

Bapedalda to report its monitoringand e,alual-on to State Mlinister ofthe Environment (at least twvice ayear) cc licens.ng agency and theGovernor

^ The Bank also has to approve these TOR and EA/EMP

A. During the preparation of an EA and EMP the proponent has to en-sure to conduct minimum procedural requirements, comprising thefollowing elements:

(1) Approval: Relevant EA Committee is the authorized agencyresponsible to review and assess TOR and/or draft EA/EMP.Proceeding approval the proponent should conduct consulta-tions with the Stakeholders Forum and the PAP. These con-sultations are mandatory, and results of the consultationsshould be recorded as an integrated part of the EA report.

IHAl AMAN A


(2) Reporting: Administratively, the EA Committee reports theiractivities to their respective superior authorities, i.e Mayor orBupati (for Kota/Kabupaten EA Committee), or Governor (forProvincial EA Committee). The proponent should report theimplementation of EMP and environmental monitoring to rele-vant agencies as noted in Figure 1 above

(3) Monitoring: The subproject proponent is the principal agencyresponsible to conduct routine environmental monitor. How-ever, Bapedalda is the government agency responsible tomonitor environmental quality within their jurisdiction. In thatrespect Bapedalda may be asked to supervise monitoring ac-tivities of the proponent to ensure their conformity with prevail-ing standards and regulations.

B. Public Consultations during EA preparation and implementationshould take the following aspects into consideration:(1) To avoid bias during the decision making process because of a

possible conflict of interests among the stakeholders within lo-cal governments - (they are involved as proponent as well aspermanent members and secretariat of the EA Committee) -consultation with the Stakeholder Forum and PAPs are manda-tory steps. Consequently, comments made during public con-sultation with regard to social and/or environmental impacts ofthe proposed subproject should be adequately addressed andanswered and accommodated in the TOR of EA and EMP.

(2) Government Regulation (PP) No. 27/1999 concerning EA arti-cle 33 (3) states that within 30 days after the announcement ofthe proposed subproject, concerned parties, including PAP, lo-cal NGOs, and other concerned stakeholders may give theircomments, suggestions, and complaints to the proponent incharge of subproject development.

(3) During the EA process the proponent informs the StakeholdersForum, and other local NGOs that are not represented in theStakeholders Forum, and the PAP, discusses the subproject'senvironmental and social aspects and impacts and takes theirviews into account. The proponent consults these groups atleast twice: (i) shortly after environmental screening is finalizedand prior to the preparation of the terms of reference (TOR) forthe EA is finalized; and (ii) after the draft EA and EMP reportsare prepared and ready for evaluation (by the EA Committee).In addition, the proponent consults with these groups through-out subproject implementation, as necessary, to readdress EA-related issues and subproject impacts.

(4) For meaningful consultations among the proponent, the Stake-holders Forum, local NGOs, and PAP, the proponent provides

I WAI ARAAN in


all relevant material in a timely manner prior to the consultationprocess and in a form and language that are understandableand accessible to the groups and people that will be consulted.The material includes a summary of the proposed subproject'sobjectives, detailed technical description, and comprehensiveillustration of potential impacts. For consultations after thedraft EA and EMP reports are prepared, the proponent pro-vides a summary of the EA and EMP, including conclusionsand recommendations. In addition, the proponent should alsodisclose the draft EA and EMP reports available to the publicfor an unlimited period of time, accessible to the StakeholderForum, and local NGOs.

(5) With regard to environmental and social issues there should betransparent public complaint procedures in place. Public com-plaints should be resolved prior to the tender phase of the con-cerned subproject. Complaints filed at any time prior construc-tion, during construction and/or operation of the subprojectneed to be solved amicably between the proponent and thecomplaining party. Complaints that cannot be solved by theproponent within a period of 30 calendar days should be for-warded to the Safeguard Oversight Team for mediation. In theevent that complaints that are filed prior to construction cannotbe solved amicably within one year, the construction of thesubproject should be altered, or adjusted, or postponed.

4. Land Acquisition and Resettlement Framework4.1. Basic PrinciplesPrinciples of land acquisition and resettlement for USDRP related subprojects areas follows:

A. Subprojects should avoid, or minimize land acquisition that requiresand impacts on resettlement of inhabitants. Impacts may not be lim-ited to land, shelter, and cost of moving from the current location toan alternative location, but also include loss of assets, access to as-sets and sources of income or means of livelihood. Subprojectsneed to explore viable alternative to minimize such impacts.

B. Subprojects should, transparently, include the cost of land acquisi-tion that is agreeable by all concerned stakeholders, especially thePAP4 . The PAP should have an opportunity to have a separate dis-cussion and agree with the terms of compensation and/or resettle-ment with the proponent.

C. Land acquisition should not worsen the living conditions of the PAP.

4See 3.2 C. Institutional Arrangement, below

I LJAI AFAAAKI 1d


The PAP has the rights to get real replacement cost compensationsuch as alternative land and/or cash compensation equal to the realmarket price of land and assets (such as building, trees, and otherproductive assets). Other related costs such as the cost of moving,land transfer, rearrangement of land certificate and taxes should beborne by the proponent.

D. The compensation for renter, sharecropping or agricultural laborerthat have to move their activities to other places are at least equalto: (i) three months rent, (ii) the value of the harvest for that seasonof those particular land and crops (or give the opportunity for them toharvest first), or (iii) a total income of the labor in that season.

E. The PAP should agree with the compensation or, if acceptable, vol-untarily contribute parts of their land to the subproject. Meetingsamong the PAP, facilitated by the Stakeholders Forum, should bearranged to make sure that the PAP could have their independentdecision.

F. Voluntary contribution can only be considered if the PAP has directbenefit far exceeding the cost of that land (proof by mutual calcula-tion signed by both sides), only taking equal or less than 10 % oftheir plot area and a letter of approval signed by the PAP after thePAP have a separate discussion as described in point B above andhave a clear explanation of their rights. The Safeguard OversightTeam has to make sure that there is no pressure to the PAP to con-tribute their land. The agreement should be documented in a legaldocument.

G. Subprojects should already have the alignment of land needed, thenumber of PAP, general information of the PAP' income and em-ployment, and the existing land market price, proposed by the pro-ponent and supported by NJOP (land tax form), before land acquisi-tion (with, or without resettlement) is commenced.

H. The preparation of land acquisition action plan (LARAP) and its im-plementation are the responsibility of the proponent (Dinas) whoproposes the subproject, monitored and overseen by the SafeguardOversight Team.

4.2. ThresholdsA. Proposals that cause impacts to 40 households (200 persons) or

more should have a land acquisition and resettlement action plan(LARAP). LARAP consists of:(1) An identification of social and economic conditions of those

PAP;(2) A comprehensive plan on land acquisition and resettlement, its

schedule, including schedule of consultations, negotiations,and consultations, definition of agencies responsible for im-

WAI AIAAMKI 10)


plementation, budget, and monitoring of the proceeds;(3) Agreed compensation packages;(4) Complaint and grievance mechanisms

B. The identification of social and economic conditions needs to beformalized in a comprehensive study that consists of:(1) List of persons or households potentially affected;(2) Types, amount, or value (in money terms) of assets affected;(3) Socio-economic conditions: employment, income, etc;(4) Perception of, and expectation to, the project.

C. Proposals that cause impacts to less than 40 households shouldhave the following assessment made:(1) A simple format that shows: the compensation agreement, the

resettlement plan, the investment proposal, lots of land in-volved, name of owners, and estimated costs for land acquisi-tion and resettlement;

(2) Transparent and participative negotiation process and agree-ment;

(3) The PAP should aware that they have the right to be compen-sated and/or having other kinds of assistance; and

(4) Agreed subprojects and compensation packages.

4.3. Procedures of Land Acquisition and Public Consultation

A. In the event that resettlement is unavoidable the proponent has toimplement an approval and consultation process that involves vari-ous stakeholders, including the PAP, the Stakeholder Forum, theSafeguard Oversight Team, the Head of ULG and the Bank.The following chart is outlining the flow of process as minimum re-quirements that needs to be followed by the proponent.

Figure 2: Procedures in the Preparation of Land Acquisition andResettlement Action Plan

I IHIAI AMAN 13


Proponent (i.e Dinas, or line depart-ment within the local government) to

propose subprojects

No land acquisition re- Land acquisition requiredquired

Proponent to report this Proponent (could be assisted Socialization to the PAP,survey to NMC by consultant), to conduct may be faclitated by the

cc ExA and the WB socio-economic survey Stakeholders Forum

~~~~~~gNo< impats to40 HH

s

Consultation wthe PAP Proponent prepares a Proponent prepares Proponentmay be facilitated by the TOR for LARAP a Simple (formal) needs NOL from

Stakeholders Forum LARAP the Central PMU

Proponent preparesProponent needs N~OLfor B LARAPthe TOR from the Bank

Proponent needs NOL Proponent needs a decree (SK) from the Head of ULGfor the SK from the Bank to legalize the LARAP

I ; | ~~~~~~~~~Safeguard Oversight Team to |Proponent to implement monitor and oversee ihe imple-

LARAP mentation of LARAP

|Proponent reports the imple-|| mentation of LARAP to: |

- Mayor / Bupati, cc- The Bank

NMI

B. Public disclosure procedures for land acquisition and resettlementare as follows:

(1) Subprojects should be socialized to, and consulted with, con-cerned parties, particularly the PAP. Socialization and consul-tation should be conducted at the time of: preliminary study,social-economic study, the drafting of the decree and the issu-ance of the decree. Socialization and consultation are the re-sponsibility of the proponent (Dinas) who proposes the subpro-

I HAi AMAN 14


jects (could be assisted by its consultants). It is also necessarythat the PAP should have an opportunity to discuss such pro-posal separately, and to agree to the compensation and reset-tlement plan;

(2) Socialization and consultation should include: detailed informa-tion concerning the subproject's size, volume, implementationplan, benefits and risks, and possible negative impacts. ThePAP should be able to: give suggestions, ask questions, or ex-press concern regarding the investment plan. Furthermore, thePAP should also be able to give inputs to LARAP, e.g. con-cerning compensation packages, resettlement location, andother benefits. Socialization and consultation may be con-ducted in the form of focus group discussion, which involve,among other members of the community, representative ofwomen. To ensure that perception and aspiration of the PAPare accommodated, minutes of the discussion, signed by rep-resentatives of each parties, should be attached to the LARAP;

(3) This framework should be discussed openly and agreed by theStakeholder Forum. This framework should also be dissemi-nated openly to the participating ULGs in easy to understandformat, such as leaflet and poster. Leaflets and posters will bedistributed to the potentially affected communities and avail-able media;

(4) The PAP should have full understanding about their right ac-cording to this framework and have sufficient time and oppor-tunities to discuss among themselves to be able to come outwith their own independent decision;

(5) Each decision and safeguard plan should be disseminatedwidely, especially among the PAP. The Safeguard OversightTeam should monitor/oversee the dissemination of this infor-mation.

C. With regard to resettlement issues there should be transparent pub-lic complaint procedures in place. Public complaints should be re-solved prior to the tender phase of the concerned subproject. Com-plaints that cannot be solved by the proponent within a period of 30calendar days should be forwarded to the Safeguard OversightTeam for mediation. In the event that complaints that are filed priorto construction cannot be solved amicably within one year, the con-struction of the subproject should be altered, or adjusted, or post-poned.

D. LARAP should be endorsed through a Mayor's or Bupati's decree(SK).


5. Function and Responsibilities of Institutions Involved

5.1. Involved Agencies at Local Level

Agencies at local level are involved in various aspects and stages of theimplementation of safeguard framework, as follows:

A. Proponent of subproiect. The proponent of a subproject is partici-pating ULG, through their relevant line department (Dinas). Theproponent is responsible to prepare TOR, EA and EMP, or simplifiedEMP (for Environmental Assessment); and to conduct socio-economic survey, and to prepare TOR and land acquisition and re-settlement action plan (for Land Acquisition and Resettlement), aswell as to supervise their implementations;

B. Relevant EA Committee. EA Committee is the authorized agencyresponsible to review and approve TOR, EA and EMP, or simplifiedEMP. According to Government Regulation (PP) No. 27/1999 con-cerning EA, Article 8, relevant EA Committee for USDRP subpro-jects will most likely be the municipal/district EA Committee (if exist-ing), or Provincial EA Committee5 . DLH - Dinas Lingkungan Hidup(Environmental Agency of the ULG) is a permanent member of theEA Committee, and, typically, their office is acting as the secretariatof the EA Committee.

C. The Potentially Affected People (PAP). The PAP means the indi-viduals, families, and/or community who own, rent, or occupy land,buildings and or other assets attached to the land subject of acquisi-tion; and, on the account of the execution of said land acquisitionplan, would have their standard of living, land related assets, accessto productive assets, business and employment opportunity ad-versely affected.

D. Bapedalda - Badan Pengendalian Dampak Lingkungan Daerah -(Environmental Impact Management Agency, at ULG level) is theauthorized agency responsible to conduct government tasks in thefield of environmental impact management, which includes, amongother duties, to prevent and to mitigate environmental impacts. Withregard to USDRP, the role of Bapedalda is to supervise the propo-nent in implementing EA and EMP, and to monitor the quality of the

5According to prevailing regulation, EA Committees, which are responsible to review EAdocuments, are either: Central EA Committee, or Provincial EA Committee, or ULG EACommittee. Those Committees are not hierarchical; each has a separate jurisdiction de-pending upon several factors. Article 11 (1) of Government Regulation (PP) No. 27/1999concerning AMDAL states: Central EA Committee is responsible to review EA which haselements of national strategic and/or is related to state defense, with impacts that coversmore than 1 Province, located in conflict areas with (an)other state/s, located in the sea,and/or its location also covers jurisdiction of (an)other state/s. Article 11 (2) states that local(Provincial or Municipality/District) EA Committee is responsible to review EA which haselements not included in the above criteria.

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USORP) Safeguard Framework for USDRPJapanese Grant No. T F 026836 through IBRD

environment in general. Bapedalda is a permanent member of localEA Committee.

E. Safeguard Oversight Team (SOT). SOT is a team established atULG level prior to the preparatory stage of the subprojects to super-vise and oversee compliance of the framework and its application toexisting regulations and environment/social situation. SOT consti-tutes representatives of relevant ULG Dinas or units at the localgovernment, and NGOs whose activities focusing on environmental,and/or land, and/or human rights issues. The SOT may sharemembership with the SF. The SOT is coordinated by the Head ofBappeda (ULG Development Planning Board). The establishment ofthe SOT shall be endorsed through a Mayor'slBupati's decree.

F. Stakeholders Forum (SF). SF is an informal representations ofelements of the civil society, such as local NGOs, local universitylecturers, opinion leaders, traditional leaders, religious leaders, aswell as members of local council and local government officials - allin their personal capacities, committed to discuss constructively andcontribute to local urban development issues and to suggest ways toimprove them. USDRP promotes such an approach as means to in-crease public participation. SF involves in the review of TOR, EAand EMP (Environmental Assessment) as a consulting body, and infacilitating consultation between the PAP and the proponent (LandAcquisition and Resettlement). If necessary, proponent of the sub-project should also consult the Forum during implementation ofEMP.

5.2. Involved Agencies at National LevelVarious agencies are involved at the National level, especially those who will bedirectly involved in USDRP implementation and of various aspects and stages ofthe application of the safeguard framework. They are:

A. Executing Agency (ExA). For USDRP the Ministry of Settlementsand Regional Infrastructure is the ExA on behalf of the Governmentof Indonesia (GOI).

B. National Management Consultant (NMC). On behalf of ExA, NMC isresponsible to manage overall day to day operation of the project.As such NMC is to report to the ExA, at least on a monthly basis.

C. The World Bank (WB). WB is the creditor who finances a part or en-tire parts of the subprojects, and consequently it has the right to re-view and to approve TOR, EA, and EMP; and TOR and SK forLARAP. The Bank will only review simplified EMP randomly.

5.3. Institutional Arrangement

H I-AI AMAN 17

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP) Safeguard Framework for USDRP* Japanese Grant No. T F 026836 through IBRD

With regard above definition of roles, the following two tables illustrate the institu-tional framework to prepare and approve EA and LARAP, and reporting relation-ship among the involved agencies.

Table 4: Institutional Arrangements for EA Preparation

Approve (preparation stage) orNo. EA Stage Conducted by Consult with Overseen (implementation Report to

stage)1. Preparation

TOR, draft EA Proponent of sub- Stakeholders Relevant EA Committee, NMC, cc ExAand EMP project, i.e. a Dinas Forum (SF) and and the Bank and the Bank

within the local PAPgovernment

Simplified EMP Proponent of sub- Relevant EA Committee, NMC, cc ExAproject, i.e. a Dinas and reviewed randomly by and the Bankwithin the local the Bankgovernment

2. Implementation: Proponent of sub- SF and PAP (if Safeguard Oversight Team ExA cq NMCSupervision of project (may be necessary) (SOT) Bapedalda 1)EMpervisiond of supervised by

EMP; and Bapedalda). GovernorConduct envi-ronmental moni- The Banktoring

1) Bapedalda subsequently reports its monitoring and evaluation to State Minister of the Environment atleast twice a year, CC to licensing agency and the Governor.

Table 5: Institutional Arrangements for Land Acquisition Plan Preparation

Approve (preparation stage),No LARAP Stage Conducted by Consult with or Overseen (implementation Report to

_____ ~~~~~~~~~~~~~~~~~~~~stage)

1. Plan preparation: Proponent of sub- The PAP, facili- The PAP, and the Bank NMC, cc theTOR and LARAP projects (i.e.Dinas) tated by the (for the TOR and the SK). WB and ExA

- may be assisted Stakeholders LARAP is to be endorsedby consultant Forum (SF) by the mayor/Bupati' de-

cree

2. Implementation Ditto PAP Safeguard Oversight Mayor/Bupati,Team (SOT) cc the WB and

___ ~~~~~~~~~~~~~NMC

3. Monitoring SOT PAP SOT Ditto

A. To ensure that responsible agencies do have sufficient capacity tocarry out their duties efficiently it is suggested to analyze presentmanagement capacities and to conduct trainings to improve delivery

IHAI AMAN IR8


and management capacity of the key agencies involved, namelySafeguard Oversight Team, Bapedalda and the related subprojectproponent (Dinas).

B. The World Bank may be asked to provide assistance to the localgovernment (or Dinas) during the preparation of LARAP, but theBank's fund could not be used to finance any part of the LARAP im-plementation. This is true whether the investment plan will befunded entirely, or partly, by the Bank. The Bank's fund may beused to finance the development of resettlement site, such as theprovision of basic infrastructure.

C. LARAP should be endorsed through a Mayor's or Bupati's decree(Surat Keputusan - SK). Such a decree should be pre-approved bythe Bank to ensure its conformity with the loan agreement.

6. Legal Consideration

A. The ultimate legal basis of EA preparation and implementation, aswell as land acquisition and resettlement, is the effective USDRPloan agreement between GOI and the Bank. For the Bank contentof this agreement is dictated by its operational procedures set forthin its various operational policies. For GOI policies for EA is statedin law no. 23/1997, government regulation 27/1999, and various de-crees of the State Minister of the Environmental and other TechnicalMinistries, as illustrated at the Annex 3. Land acquisition processshould also be in accordance with the Presidential Decree (Kepu-tusan President, or Keppres) No. 55/ 1993 concerning land acquisi-tion for developments that are of public interests.

B. Preparation of TOR, EA and EMP should be reviewed and endorsedby an authorized body (relevant EA Committee for EA, and theBank). For land acquisition, its TOR, and supporting decree (SK)also need approval (NOL) from the Bank. Together with reportingmechanisms of this safeguard as mentioned in the institutional ar-rangements, this approval mechanism aimed at ensuring that thepreparation and implementation of EA/EMP and LARAP follow cer-tain procedures and standards.

HAI AMAN lg

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP) Safeguard Framework for USDRP- Japanese Grant No. T F 026836 through IBRD

Annex 1: Project Type Map

Types of Cost Recovery Projects Types of Non-cost Recovery Projects

Definition: a project that generates direct Definition: a project that is not a cost recovery pro-financial revenues in the form of user jectcharges (tariffs or levies)

Examples of eligible projects

Hospitals (other than Puskesmas) Puskesmas

Pregnancy clinics (Rumah Bersalin) Kampung improvement

Market development Elementary and secondary schools

Solid waste collection (excl. TPAs) Tempat Pembuangan Akhir (TPA)

Composting facilities Drainage and flood control

Transport terminals Traffic management infrastructure

Public transport services Land consolidation

Parking lots Environmental protection

Slaughter houses Elderly houses (panti asuhan)

Human waste collection (excl. jamban umum) Community sanitation (jamban umum)

Water supply systems Erosion protection

Toll roads and toll bridges Roads and bridges (not tolled)

Housing Micro-irrigation

Public cemeteries Youth centers

Cold storage facilities Libraries

Storage facilities for agricultural products Musea

Radio and TV infrastructure Social rehabilitation centers

Touristic objects Parks

Recreation facilities Incineration facilities

Sports facilities

Convention centers

Ferries

Port facilities

E-government facilities

Kawasan Siap Bangan (Kasiba)Notes:- If a project is in any of the above lists, it will not be automatically approved

- Cost recovery projects which are not financially feasible do not qualify for grant funding

- Cost recovery projects with an element of subsidy are to be classified as 'cost recovery'

- Pilot projects in the list of cost recovery projects are to be classified as 'cost recovery'

- If a local government deliberately attempts to restructure a project in such a way that it avoidsbeing classified as 'cost recovery', it will be excluded from the appraisal process for a period ofmaximally three years

- If a proposed project is not in the above lists, the Tim Penilai will classify the project based onthe definition of a cost recovery project

Source: Consultant

I HAI AMAN 9n

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP) Safeguard Framework for USDRP* Japanese Grant No. T F 026836 through IBRD

Annex 2: USDRP Safeguard Organization

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I AIAAN9

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP) Safeguard Framework for USDRPa Japanese Grant No. T F 026836 through IBRD

Annex 3: Type of Sector and Project Scale that require EA or EMP

The need to prepare EA and or EMP is triggered in accordance to the following prevailingIndonesian regulations:

1. Decree of the State Minister of the Environment No. 17/2001, dated 22 May 2001;and

2. Decree of the Minister of Settlements and Regional Infrastructure No.17/KPTS/2003, dated 3 February 2003

SCALESECTOR and ACTIVITY

EA6 EMP'

Water Supplya. Development of distribution network (serving area) 2 500 Ha 100 - < 500 Ha

b. Development of piped transmission network (length) 2 10 km 2 - < 10 km

c. Water intake from surface spring water, river, lake, or > 250 I/sec 50 - < 250 I/secother sources (intake debit)

d. Development of water treatment plant (debit) > 50 I/sec

e. Ground water intake 2 50 I/sec > 5 - < 50 I/sec

Solid Wastea. Final disposal with control landfill system/sanitary

landfill (non-hazardous waste)- Area coverage 10 Ha < 10 Ha- Total capacity Ž10.000 ton < 10.000 ton

b. Final disposal in tides area- Landfill coverage 5 Ha < 5 Ha- Total capacity 2 5.000 ton < 5.000 ton

c. Development of transfer station- Operational capacity 2 1.000 ton/day < 1.000 ton/day

d. Final disposal with open dumping system All size

e. Development of Incinerator All size

f. Building for composting and recycling 4 ton/day

> 500 m2

Construction of WWTP & Seweragea. Waster water treatment plant (feces) 2 2 Ha < 2 Ha

b. Waste water treatment plant 2 3 Ha < 3 Ha

' See Decree of the State Minister of the Environment No. 17/2001, dated 22 May 2001 on Types of Activities that Need tobe Accompanied by Comprehensive EA.

7 See Decree of the Minister of Settlements and Regional Infrastructure No. 17/KPTS/2003, dated 3 February 2003 onTypes of Activities that Need to be Accompanied by (simple) EA, and/or EMP.

I HALAMAN 22

URBAN SECTOR DEVELOPMENT REFORM PROGRAM (USDRP) Safeguard Framework for USDRPv Japanese Grant No. T F 026836 through IBRD

SCALESECTOR and ACTIVITY EA6 EMP'

c. Sewerage piping 2 500 Ha < 500 Ha

Drainagea. Development of drainage in large city / metropolitan

area 5 km < 5 km- Primary drainage (length) 1 -5km- Secondary and tertiary drainage (length)

b. Development of drainage in medium-sized city- Primary drainage (length) 10 km < 10 km- Secondary and tertiary drainage (length) 2 -10 km

c. Development of drainage in small-sized city - > 5 km

River Normalizationa. Metropolitan city

- Length 5 km 1 - < 5 km- or volume of dredging 2 500.000 m3 1 - 5 Ha

b. Medium-sized city- Length 5 km 3 - < 10 km- or volume of dredging 2 500.000 m3 -

c. Rural area- Length 5 km km s/d < 15 km- or volume of dredging 2 500.000 m3

d. Waterway diversion All size

Flood Canala. Metropolitan city

- Length of canal 5 km 1 - < 5 km- or area coverage for land acquisition Ž 500.000 m3 2 - 5 Ha

b. Medium-sized city- Length of canal 5 km 3 - < 10 km

c. Rural area- Length of canal 5 km 5 - 15 km

RoadDevelopment and/or road betterment with broadening ofroad outside Right of Waya.1 Metropolitan city

- Length 5 km 1 - < 5 km- or area coverage 5 Ha 2 - < 5 Ha

a.2 Large city- Length 10km 3 - < 10 km- or area coverage 2 10 Ha 5 - < 10 Ha

I HAI AMAN 93


SCALESECTOR and ACTIVITY SCA LE

EA6 EMP7

a.3 Rural area - inter urban, length 2 30km 5 - < 30 km

Road betterment with broadening inside Right of Wayb.1 Large city/ metropolitan

b.2 Arterial road/collector (length) 2 10 km

Bridge (New Construction)a. Large city (length) 20 mb. Medium-sized city (length) 2 60 m

Construction of Harbora. Pier with massive construction

- Length 200 m- or coverage 2 6.000 m2

b. Break water Ž 200 m

c. Supporting infrastructure 2 5 Ha

d. Single Point Mooring Buoy 2 10.000 DWT

Fish Harbora. Length of pier 300 mb. Industrial estate (fishing) 10 Hac. Depth of water ways in the pier 2 -4 m LWS

Hospital Types A or B, or -

equivalent

Housing/Residential

a. Metropolitan city (coverage) 25 Ha 2 - < 25 Hab. Large city (coverage) 50 Ha 2 - < 50 Ha

c. Small to medium-sized city (coverage) 2 100 Ha 2 - < 100 Ha

Building Construction(Education, trading, offices, religion place etc)a. Area coverage 5 Hab. or building coverage Ž 10.000 m2 < 10.000 m2

New Construction for Resettlementa. Number of persons removed 200 households 50 - 200 house-

b. or area coverage 2 100 Ha holds2 Ha - 100 Ha

I HALAMAN 24

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