Resettlement Completion Report

Annual Report 30 March 2012

MON: Urban Development Sector Project — Erdenet Subproject

Prepared by Purevsuren Dorjnamjil, Resettlement Specialist, Project Management Unit

for the Government of Mongolia and the Asian Development Bank.

This resettlement report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB's Board of Directors, Management, or staff, and may be preliminary in nature. In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

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RESETTLEMENT COMPLETION REPORT 30/03/2012

Project number: L2301-MON

MONGOLIA: URBAN DEVELOPMENT SECTOR PROJECT RESETTLEMENT COMPLETION REPORT OF ERDENET SUBPROJECT

Prepared by Purevsuren Dorjnamjil, Resettlement Specialist, Project Management Unit

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TABLE OF CONTENTS

TABLE OF CONTENTS .................................................................................................. 1

ABBREVIATIONS ………………………………………….………………………………..3

RESETTLEMENT REPORT OF ERDENET SUB PROJECT .......................................... 6

A. LARP DEVELOPMENT AND IMPLEMENTATION IN 2009………...………………..6

B. LARP DEVELOPMENT AND IMPLEMENTATION IN 2010……...…………………..11

C. CHALLENGES ......................................................................................................... 15

D. RECOMMENDATION ............................................................................................... 16

E. CONCLUSION .......................................................................................................... 16

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ABBREVIATIONS

ADB Asian Development Bank

AH affected household

AP affected person

CBO Community-based organization

DOR Department of Road

DMS Detailed measurement survey

GAF grievance action form

GOM Government of Mongolia

HH household

IRP Involuntary Resettlement Policy of ADB

LRCUDD Land Relations, Construction and Urban Development Department

LAR Land acquisition and resettlement

LARF Land acquisition and resettlement framework

LARP Land acquisition and resettlement plan

MRTCUD Ministry of Road, Transportation, Construction and Urban Development

NGO Nongovernment organization

PIU Project implementation unit

PMU Project management unit

ROW right of way

RRP Report and Recommendations of the President (ADB)

WG Working group

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RESETTLEMENT REPORT OF ERDENET SUB PROJECT

1. Asian Development Bank (ADB) funded L2301–MON: Urban Development Sector Project has been started resettlement activities in Erdenet subproject since the end of the 2008 according to the provision G-34 of Loan Agreement between Government of Mongolia and the ADB. The Working Group (WG) for the Subproject formed on 20 May 2009 under Resolution 161 of the Governor of Orkhon aimag. The working group is responsible for the implementation of the land acquisition and resettlement plan (LARP) and consists of representatives from Aimag Government Administration, Governors of bag, Land Administration Department of the Aimag, Property Relations Agency, PIU, NGO and displaced people. 2. Mr. Ralf Starkloff, the first international resettlement consultant has worked for the project from April 2009 to January 2010. During his assignment, he developed Land Acquisition and Resettlement Framework (LARF) for the Urban Development Sector Project (Project) in accordance with the ADB's Involuntary Resettlement Policy (1995) and Land Acquisition and Resettlement Plans (LARP) for subprojects that have land acquisition and resettlement (LAR) impacts and stipulates arrangements for consultation and public participation, grievance redress, and monitoring and evaluation. In 2009, Mr. Ralf Starkloff developed and got approval from MRTCUD, Governor of Orkhon aimag and ADB on LARP for Erdenet sub project. In 2010, the national resettlement specialist D. Purevsuren developed and got approval from MRTCUD, the Governor of Orkhon aimag and ADB on additional LARP in Shand, Naran and Bulag bags‘ area of Erdenet sub project. Updated LARP for the Erdenet Basic Urban Services Improvement sub project got approval from ADB in November 2010 and uploaded in ADB‘s website. 3. The subproject has been improved the water supply and sewage system of Erdenet through (i) the drilling and protection of a new well field with 3 boreholes, (ii) 24.44 km water transmission line to bring the water to 2 new reservoirs of 1000 m3 each above the ger area, (iii) 10.02 km of water distribution pipelines, (iv) 5.2 km sewage pipelines, (v) 30 new water kiosks along the main water lines, and (vi) 10 connection boxes to allow individual water connections in the future. The new water supply system benefited 6675 households, including 3229 that are considered to be poor. Roughly 47.2% of all poor households living in Erdenet are located in the subproject area. The right of way (ROW) of the pipelines, which traverse the subproject ger areas in various directions, has a ROW width varying between 5m and 10m. In order to minimize resettlement impact, the standard trench width of 10m was reduced to 5m in several densely settled sections in accordance with the Construction Standard and Rules of Mongolia for Water Supply, External Networks and Structures BNBD 40-02-06.

A. LARP DEVELOPMENT AND IMPLEMENTATION IN 2009

4. Mr. Ralf Starkloff, the International resettlement consultant and D.Purevsuren, the national resettlement specialist have worked several times in subproject area and fulfilled activities such as field verification and identification of LAR scope, individual meetings and sharing opinions with APs and related officials, census of all potential affected persons and socio-economic survey of sample of affected persons, detailed measurement survey of affected land and property, notification of affected persons and establishment of cut-off date. The resettlement team closely worked with engineers from the ―Prestige Engineering‖ consulting company, on ADB Involuntary resettlement policy and as a result, totally 49 households were affected. At the time for conducting the AP census, the cut-off date of 29 June 2009 for the subproject was publicly notified in the subproject area, including at the offices of the Governors of affected Bags. The APs have also been notified individually by the LRCUDD using a notification form specially designed for the Project. 5. A 49 AHs were formally enumerated in the AP census. To gain an in-depth understanding of the socio-economic situation of the APs in Erdenet, a sample survey of 13

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AHs (25.5% the 51 AHs) has been carried out which included interviews with 11 men and 13 women. There were a total of 212 APs, 106 male and 106 female, 70 of which were children. 6 households were female headed. 6. The Land Relations, Construction and Urban Development Department (LRCUDD) of Orkhon Aimag has provided the land valuation based the government rates and a qualified property valuation consultant from ―Besge‖ company has provided the DMS and market value without depreciation. 7. The APs from Erdenet sub project consisted of different ethnic groups of Mongolia. Among the APs 159 or 75.7 percent were of the Khalkh ethnic group, which was the mainstream cultural group in Mongolian society. 12 or 5.7 percent were of the Dorvod, 13 or 6.2 percent of the Khoton, and 7 or 3.3 each were of the Bayad and Uriankhai ethnic minority groups. In addition there were Uuld (5), Khotgoid (3), Zakhchin (2) and Darkhad (2). There was a considerable variety of ethnic minorities among a quarter of the APs, many of whom have intermarried with the Khalkh or other groups. 8. Some water distribution and transmission lines and some of the sewage pipelines involved land acquisition and resettlement the other project components constructed on public land. Even though the approved LARP stated that there were 51 affected HHs, the number of affected HHs were reduced up to 49 in the implementation stage as one owner changed her mind to give up the land. Then the design company made a change on ROW in that area and as a result, two APs avoided. 30 of the households were vulnerable due to incomes below the poverty line, including 5 disabled and 2 aged heads of household. 2 vulnerable affected households required relocation due to the loss of full plots. 6 households were female headed. 44 households lost a total of 4496m2 of residential land, 42 of which were partial losses. 1 household lost 38m2 of commercial land. A total of 76 residential structures were affected and moved, including 1 house and 2 gers, 42 fences (1409.5m), 8 latrines, 2 defunct small shops, as well as various other small structures. In addition, 8 APs from 7 households operating 9 commercial establishments experienced short-term business losses. 4 of these did not experience loss of land. 9. The one of relocated HH has bought 2 rooms apartment using their compensation money and lives there with satisfaction. Another relocated HH has been living in Dornogovi aimag. It took long time for us to contact and identify this HH. After long lasting effort, we found them and concluded contract. The HH had no license and occupied small portion of land 277m2. They got compensation and went back to Dornogovi aimag. They informed us that at these days, they have no intention to settle in Erdenet as they have a small mining business in Dornogovi aimag. If they get land in Erdenet as compensation for lost unlicensed land, then it causes them problem for keeping fence as there is no one who could look after for the fence and land. Once, if they decide to get land in Erdenet, LAD will provide land within areas where land is available. 10. LAR activities completed in 2010. 11. The budget for land acquisition and resettlement in 2009 in the Erdenet subproject was amount of MNT 55,521,552.30 or USD 39,045 for compensation as well as administration and contingency costs, which were funded from state government resources. All compensation distributed to APs timely. No complains submitted on this regard.

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PHOTOS During census and socio-economic surveys.

At the time of conducting the AP census, the cut-off date of 29 June 2009 for the subproject was publicly notified in the subproject area.

A training workshop on ‗Land Acquisition and Resettlement in the Implementation of ADB Financed Urban Development Projects in Mongolia for Key Stakeholders of the Urban Development Sector Project‘ was held at the Erdenet Governor‘s Office with concerned government officers, including WG members, AP representatives and other stakeholders of the UDSP subproject in Erdenet on 30 June 2009. The participants were trained on the legal framework of the project, including applicable Mongolian Laws, ADB IRP and the UDSP LARF, and the steps of the process of LARP preparation and implementation.

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Meeting with Governor of Orkhon aimag and WG members dated 9 Sep 2009.

Meeting with Working group members dated 19 March 2010.

Disclosure meetings were held at the Shand bag‘s office on 10 September, 2009.

PHOTOS OF AFFECTED PEOPLES BEFORE AND AFTER RESETTLEMENT ER011 P. Batsukh

ER012 B. Sainjargal

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ER015 D. Chuluunbaatar‘s plot before LAR

After LAR

The AP has bought two rooms apartment using their compensation money and lives there with satisfaction. Mr. Ralf Starkloff visited the HH in March 2010.

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ER016 Ch. Ouynjargal

B. LARP DEVELOPMENT AND IMPLEMENTATION IN 2010

Reason why additional land acquisition and resettlement was needed: 12. In 2010, the local government decided to build new paved road between Naran, Bulag and Shand bags‘ area and at these places where no resettlement has been anticipated in the LARP of 2009. Related to this road, new resettlement had to be carried out as centers of transmission pipeline and the new road between Bulag and Shand bags were overlapped. During meeting with Governor of Orkhon aimag in June 2010, the governor expressed his interest to have resettlement in these areas following ADB‘s involuntary resettlement policy. Because, 13 APs out of 24, were affected by water transmission line which was about to build by UDSP sub project, other 11 APs affected by the road parallel with the line. As requested the Governor by his official letter 1/1044 of 18 June 2010, the project developed additional resettlement plan where 24 APs remunerated in the census. Developing of this additional resettlement plan has not been included in TOR of the international resettlement consultant. Therefore, the national resettlement specialist developed the plan based on her lessons and experiences obtained from previous sub projects. 13. A 24 households affected of which 23 AHs could enumerated in the AP census. One AP was absent. The absentee household has been excluded from the socio-economic survey, but considered in the census as 1 male and 1 female AP. Total of 85 APs enumerated living in 24 AHs at time of census, of which 20 or 23.5 percent were children under 18 years old, more than two-thirds (67.1%) were working age persons and 8 or 9.4 percent were elderly persons aged 60 years old and over. In April, 2011, absentee AP was identified with the help of Shand bag‘s director and after several times of negotiation, he agreed to give up the small portion of his land. 14. At the time for conducting the AP census, the cut-off date of 20 July 2010 for the subproject was publicly notified in the subproject area. 15. A total 10 AHs considered as vulnerable households; 4 AHs (40%) were vulnerable on account of monthly per capita income below the poverty line for Orkhon aimag of MNT 91,500. Four AHs (40%) were headed by women and 2 AHs (20%) were headed by elderly persons. 15. The Land Relations, Construction and Urban Development Department (LRCUDD) of Orkhon Aimag provided the land valuation based the government rates and a qualified property valuation consultant from ―Besge‖ company provided the DMS and market value without depreciation. 16. The draft LARP for the Amendment to Erdenet subproject LARP was disclosed at a community meeting with 16 affected entities in the meeting room of ―Erdenet us-Dulaan tugeeh suljee‖ company on 20 September 2010. Another individual meeting was held on 21 September 2010. The APs were provided with a Mongolian translation of the key sections of the LARP. The legal framework under the Project LARF, the compensation entitlements and

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the grievance and monitoring procedures were reviewed and discussed. After clarification of a few concerns among APs, the majority of APs concurred with the compensation strategy indicated in this LARP. Clarification of questions on land sizes and scope of impact on certain property assets was incorporated into the revised amendment to LARP. 17. The water transmission lines in Naran, Bulag and Shand bags involved land acquisition and resettlement (LAR); A total of 24 households affected by LAR, including 85 affected persons (APs). 18 households lost a total of 832.5m2 of residential land, 5 household lost 73m2 of commercial land. There were a total of 34 affected structures on residential land, and 5 affected structures on commercial land. 2 HHs lost houses. Totally, 512.1m wooden and 93.3 m fences belonging to 23 affected households needed to be moved. 5 HHs moved their latrines to their new property boundaries. Total of5 wooden sheds and 2 entrances affected by the subproject. 18. Updated LARP for the Erdenet Basic Urban Services Improvement sub project got approval in November 2010 and uploaded in ADB‘s website. 19. The updated budget for land acquisition and resettlement in the Erdenet subproject cost amount to MNT 48,420,577 or USD 36,486 for compensation as well as administration and contingency fund which has funded from state government resources. However, the project budget for 2010 did not include these expenses. Therefore, on 18 August 2010, the project called for meeting of Steering Committee of the project, chaired by the State secretary of the Ministry and introduced newly emerged situation. The Steering Committee approved additional fund for compensation and other related costs as well. 20. Two APs had complains regarding delayed payment of the 25 percent of compensation. ER2-012 could not receive remaining compensation even though he pulled back his fence and wooden house. LAD had opinion that he did not pull back the fence completely and denied to pay compensation. The national resettlement specialist worked at the field with design company‘s engineer. As the engineer confirmed, the AP pulled back the fence exactly how it should be done. After several meetings, LAD paid compensation to two APs. No written complains were received. PHOTOS In June 2010, PMU team worked in the field together with the director and specialists of LAD of Orkhon aimag, PIU staff, engineers from design company and property valuator to introduce the newly emerged situation and to clarify road and pipeline trench between Naran, Bulag and Shand bags‘ areas.

Disclosure meetings were held in Sep 2010.

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During civil work

PHOTOS OF AFFECTED PEOPLES BEFORE AND AFTER RESETTLEMENT

ER2-012 U. Voroshilov

ER2-008 S. Ganhuyag

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ER2-016 D. Jadamba

ER2-021 D. Erdenesaikhan

The AP pulled back the house and meanwhile changed shape of the house. Second photo made after completion of civil works of road and pipeline in that area.

ER2-020 D. Tserendorj

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ER2-009 G.Otgonbayar

21. Totally, 73 APs were affected by the Erdenet sub project in 2009, 2010, and 103 942 129 MNT were paid for compensation, administration expenses and contingency fund. LAR activities fully completed and contractors fulfilled 80 percent of the civil work in 2011. The sub project will be finished in November 2012.

AP number Male headed HHs

Female headed HHs

Vulnerable HHs Compensation paid MNT

73 63 10 40 103 942129,3

C. CHALLENGES

There were discrepancies between the basic map of Erdenet city that Design Company and LAD had. This caused problem for one AP for receiving compensation. According to the map that had design company, he pulled back his fence and removed the house properly. However, according to LAD, he did not fulfill his duty properly. It took 2 months to find where made mistake. As a result, AP received 25 percent compensation too late.

Even though LARP does not say that temporary disturbance occurs, in several places it happened. For instance, contractor took away the fence of two HHs to move machinery and then later put it back. Because of mistakes made in technical drawings (in some places the earthwork volume and soil density had calculated wrongly) several HHs were suffered from temporary disbursement. However none of complains have been raised.

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Lack of correspondence between the related departments. Upon completion of land acquisition and resettlement of the sub project in 2009, the local administration decided to build paved road on the trench of pipeline between Naran and Bulag bags area. However, later it became clear that this decision was made not randomly. Several years earlier, the local administration intended to build a road, but had no fund. Once they got the fund, it started preparation of construction, which caused the project additional problem. The local administration and land department should have warned to the project on planning of road before allocating the land for pipe and trench of pipelines had been choosing. Then additional resettlement in 2010 should not have happened.

Some of APs were reluctant to fulfill their duties under the contracts.

Time between completion of LAR and start of civil work has been continued longer than expected. In some way, it gave chance to the people to occupy vacated land. PIU staff paid more attention to protect the vacated land. If it found out any violation, it informed to the LAD immediately and eliminated the violation.

Land affair itself is one of the newly developing social relations. Thus, the civilians have no enough information and background on land affairs, land specialists had no experiences on LAR.

D. RECOMMENDATION

Cadastral and property valuation professional companies should be established in the rural areas and capacity of those should be strengthened.

There is need to create the united land database which can be used by real estate property registration authority and land department in case if land has been sold between citizens.

It is important to pay more attention on minimizing the impact of resettlement by narrowing the trench during preparation stage. In areas where soil is rocky or compact, narrowing the trench can cause problems during implementation stage of the civil work. It can cause unexpected disturbances.

There is need to improve legal regulation of the land acquisition and resettlement. The main principle of LAR ―No displaced person should be worse off than without project!‖ has to be set in the laws.

E. CONCLUSION

The land acquisition and resettlement for Erdenet subproject of ADB funded L2301-

MON: Urban Development Sector project under Component A-Urban Service

Improvement completed succefully as stated in the approved LARP and LARF. None

of displaced people’s livelihood worsened by the sub project. The land

acquisition and resettlement has been done in accordance with Asian Development

Bank's (ADB's) Involuntary Resettlement Policy (IRP, 1995) and ―Bank policy

implementation manual‖ (2006).

Purevsuren.D Resettlement specialist