Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) Municipal Services Improvement (P096481) EUROPE AND CENTRAL ASIA | North Macedonia | Urban, Resilience and Land Global Practice | IBRD/IDA | Investment Project Financing | FY 2009 | Seq No: 24 | ARCHIVED on 11-Oct-2019 | ISR38760 | Implementing Agencies: Former Yugoslav Republic of Macedonia, Ministry of Finance Key Dates Key Project Dates Bank Approval Date: 26-Mar-2009 Effectiveness Date: 04-Aug-2009 Planned Mid Term Review Date: 05-Oct-2019 Actual Mid-Term Review Date: Original Closing Date: 30-Nov-2014 Revised Closing Date: 31-Mar-2020 pdoTable Project Development Objectives Project Development Objective (from Project Appraisal Document) To improve transparency, financial sustainability and delivery of targeted municipal services in the participating municipalities. Has the Project Development Objective been changed since Board Approval of the Project Objective? No Components Table Name Component A: Municipal Investments:(Cost $64.25 M) Component B: Capacity Building and Institutional Reform:(Cost $2.95 M) Component C: Performance-Based Investment Grants:(Cost $5.60 M) Component D: Project Management, Monitoring and Evaluation:(Cost $2.20 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO ►Satisfactory ►Satisfactory Overall Implementation Progress (IP) ►Satisfactory ►Satisfactory Overall Risk Rating ►Low ►Low Implementation Status and Key Decisions 10/11/2019 Page 1 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) Project implementation continues progressing well. Overall, the Project is on track to achieving its Development Objectives. To date the Ministry of Finance signed 83 sub-loan agreements with 59 municipalities under the MSIP component of Municipal Investments (sub-loan component) for a total of 98 sub-projects (some municipalities signed more than one sub-loan agreement, and some of these agreements cover more than one sub-project) to finance the municipal infrastructure such as water supply and sanitation, solid waste management, local roads, and energy efficiency improvements for municipal buildings. 88 sub- projects financed from these sub-loans have already been successfully completed, while others are at different stages of implementation. In response to request of the Ministry of Finance, the MSIP closing date was extended for 12 months from March 31, 2019 to March 31, 2020 to allow for an additional number of eligible municipalities to benefit from the performance grants and fully utilize the Project funds committed for the MSIP Performance-based Investment Grants Component. 56 municipalities were confirmed to meet the grant eligibility criteria. The Ministry of Finance signed 58 grant agreements with 51 of these municipalities, while grant agreements for the remaining 5 municipalities have been approved by the Steering Committee and are expected to be signed at the end September-beginning October 2019. All investment activities under the MSIP European Commission (EC)-IPA Funded Rural Investment Window Component which provides grants to improve rural infrastructure services have been completed with 98 percent of the corresponding EU-IPA Trust Fund amount disbursed. All 78 eligible municipalities benefited from participation in this component. The component supported implementation of 83 IPA grant agreements for a total number of 133 sub-projects (some municipalities signed more than one IPA grant agreement) that financed construction, reconstruction and rehabilitation of local roads and public buildings, improvement of water supply and sewerage, green markets, and kindergartens. Furthermore, the savings that remained under completion of all IPA grant financed activities were used for (i) centralized procurement and installment of photovoltaic systems for public buildings (schools, kindergartens, water treatment plants, municipal buildings, etc.) in four poorest regions in Macedonia (North-Eastern Region, Polog, South-West Region and Easter Region), and municipality of Resen from Prespa Region, and (ii) purchase of multi-functional backhoe loaders for the poorer municipalities per planning regions. As a result, 108 photovoltaic systems were installed on or by side of public buildings in 36 municipalities, and 10 backhoe loaders with additional equipment have been procured. Some of the MSIP accomplishments to date include: more than 23,400 piped household water connections that benefited from rehabilitation works under the MSIP; more than 524.5 thousands people provided with access to regular solid waste collection. The Project also contributed to improvement of 156 km of local roads and is expected to reach the target value of 209 km improved local roads by the MSIP loan closing date. All project participating municipalities/utilities publishing their budget information on their websites, and 86 percent of participating municipalities report revenue increase of cost savings resulting from the implemented sub-projects. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance -- ►Moderate ►Moderate Macroeconomic -- ►Moderate ►Moderate Sector Strategies and Policies -- ►Low ►Low Technical Design of Project or Program -- ►Low ►Low Institutional Capacity for Implementation and Sustainability -- ►Moderate ►Moderate Fiduciary -- ►Low ►Low Environment and Social -- ►Low ►Low Stakeholders -- ►Low ►Low Other -- -- -- Overall -- ►Low ►Low Results 10/11/2019 Page 2 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) PDO Indicators by Objectives / Outcomes To improve transparency of targeted municipal services in the participating municipalities IN00749883 ►Percentage of participating municipalities that regularly publish benchmarks & sub-project progress information on their municipal or CSE’s websites, and on PMU’s Project portal (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 100.00 100.00 100.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 To improve financial sustainability of targeted municipal services in participating municipalities IN00749884 ►Improved financial performance as reflected by the percentage of participating municipalities achieving increased revenue earnings and/or cost savings in completed sub-project. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 86.00 86.00 86.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749916 ►Nb of particip.municip. implementing institutional dvpt reforms contributing to PDO, as evidenced by nb of municip. that meet 4 or more of the 7 perform. criteria (ie that qualify for perform. grants) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 43.00 56.00 50.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 To improve delivery of targeted municipal services in the participating municipalities IN00749885 ►Piped household water connections that are benefiting from rehabilitation works undertaken by the project (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 16,308.00 23,403.00 12,900.00 Date 17-Dec-2011 30-Jun-2018 30-Sep-2019 31-Mar-2020 IN00749917 ►Number of people in urban areas provided with access to regular solid waste collection under the project (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 524,516.00 524,516.00 524,516.00 Date 14-May-2010 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749918 10/11/2019 Page 3 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) ►Percentage of participating municipalities achieving targeted improvements in delivery of selected services in completed sub-projects (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 86.00 86.00 86.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 Intermediate Results Indicators by Components Component A: Municipal Investments IN00749920 ►Number of sub-loans signed (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 77.00 83.00 78.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749924 ►Number of sub-projects successfully completed (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 82.00 86.00 90.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749927 ►Length of improved local road infrastructure as a result of constructed or reconstructed local roads structure under the Project (Meter(m), Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 146,509.00 194,919.00 209,000.00 Date 26-Mar-2009 01-Nov-2018 01-Jul-2019 31-Mar-2020 IN00749929 ►Number of people benetited from improved local road infrastructure under the Project (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 414,773.00 444,987.00 492,000.00 Date 26-Mar-2009 01-Nov-2018 01-Jul-2019 31-Mar-2020 IN00749932 ►Number of female (Number, Custom Breakdown) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 149,066.00 149,066.00 211,533.00 10/11/2019 Page 4 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) Date 26-Mar-2009 01-Nov-2018 01-Jul-2019 31-Mar-2020 Component B: Capacity Building and Institutional Reform IN00749921 ►Number of municipalities that qualify for sub-loans (ie meet the eligibility criteria to participate in MSIP) (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 57.00 58.00 58.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749925 ►Number of participating CSEs and/or municipalities supported by TA activities under Component B (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 57.00 58.00 58.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749928 ►Satisfactory completion of TA contracts with outputs accepted by the clients (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The following TA have been satisfactorily completed, including: TA 3 completed satisfactorily, to analyse technological including recent TA to options and O&M analyse technological options arrangements related to Satisfactory completion of and O&M arrangements wastewater treatment in TA contracts supported by Value No TA available related to wastewater the rural areas, TA to the project with outputs treatment in the rural areas. analyze block grants to accepted by the clients One more TA to analyze municipalities. TA for block grants to municipalities preparation of technical is underway. designs for streets and local roads for the N. Macedonian municipalities is underway Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749930 ►Continued and sustained dialogue on institutional reform as evidenced by submission of studies, such as a Strategy for Financial Intermediation for Municipal Investments (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target 2 input studies completed. 2 input studies completed. Studies to inform and Approach on the next steps is Approach on the next contribute to potential being discussed with the steps is being discussed municipal finance and Value No strategy government, including with the government, municipal services reforms recommendations from the including are undertaken and WB funded municipal recommendations from the submitted to the Ministry finance ASA that are to be WB funded municipal of Finance 10/11/2019 Page 5 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) presented to the government finance ASA that will be in May-June 2019. officially communicated to the government in September-October 2019 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749931 ►Percentage of planned beneficiary feedback/citizen engagement activities implemented (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 100.00 100.00 100.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 At the end of 2018, as part of the MSIP restructuring, the CE monitoring under MSIP was enhanced by introduction of a new intermediate indicator (percentage of planned beneficiary feedback/citizen engagement activities implemented) that would help to better track and report the CE under MSIP during the extended MSIP implementation period. PMU reports the actual value of this indicator as 100%, meaning that all municipalities are using at least one of the planned CE mechanisms. Furthermore, PMU conducted an inventory of tools and feedback mechanisms actively used by the citizens in relation to the ongoing MSIP subprojects (there are 11 ongoing subprojects in 11 municipalities: Ilinden, Kisela Voda, Demir Hisar, Bitol, Centar, Radovish, Makedonski Brod, Novo Selo, Sopisthe, Karposh and Gjorce Petrov). These mechanisms include: open days with the executive is used by 45% of municipalities; open telephone line (10% of municipalities); reporting a problem online (applied by 55% of municipalities); municipal notice boards (30% of Comments: municipalities); municipal leaflets (30% of municipalities); field meetings (55% of municipalities); municipal website (70% of municipalities) and complain boxes (45% of municipalities). While leaflets, boards and websites are mostly used as tools for dissemination of the information, the telephone lines, meeting with the executives, complain boxes and the report a problem online are used as methods for receiving grievances and complains by the citizens. Field meetings (either through established community forms or meetings through the neighborhood meetings) are used for the two ways dialogue, and these methods are mostly used for discussion of capital investments. Field meetings (combination of community forms and neighborhood meetings) and website interaction (provision of information and obtaining feedback) are two most commonly used forms of interaction with citizens, whereby municipality of Ilinden and Demir Hisar are champions in using a variety of different tools for citizens participation in the local governance. Component C: Performance-based Investment Grants IN00749922 ►Number of applications to access funds (performance investment grant) under Component C (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 49.00 56.00 50.00 Date 26-Mar-2009 31-Dec-2018 30-Sep-2019 31-Mar-2020 IN00749926 ►Number of municipalities receiving a performance investment grant (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 30.00 51.00 50.00 Date 26-Mar-2009 30-Sep-2018 30-Sep-2019 31-Mar-2020 10/11/2019 Page 6 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) Component E IPA Rural Window IN00749919 ►Number of municipalities receiving a grant from IPA window under Component E (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 78.00 78.00 60.00 Date 14-Dec-2014 31-Dec-2018 30-Sep-2019 31-Mar-2019 IN00749923 ►Number of sub-projects successfully completed under Component E (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 76.00 133.00 50.00 Date 14-Dec-2014 30-Jun-2018 30-Sep-2019 31-Mar-2019 Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P096481 IBRD-76990 Effective USD 25.00 25.00 0.00 24.48 0.10 100% P096481 IBRD-81580 Effective USD 50.00 50.00 0.00 37.25 7.31 84% P150342 TF-18812 Closed USD 16.17 16.17 0.00 16.47 0.33 98% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P096481 IBRD-76990 Effective 26-Mar-2009 29-Jun-2009 04-Aug-2009 30-Nov-2014 31-Mar-2020 P096481 IBRD-81580 Effective 10-May-2012 07-Jun-2012 10-Jul-2012 30-Nov-2017 31-Mar-2020 P150342 TF-18812 Closed 24-Dec-2014 24-Dec-2014 19-Mar-2015 31-Mar-2019 31-Mar-2019 Cumulative Disbursements 10/11/2019 Page 7 of 8 Public Disclosure Copy The World Bank Implementation Status & Results Report Municipal Services Improvement (P096481) Restructuring History Level Approved on 15-Dec-2011 ,Level 2 Approved on 14-Dec-2018 Related Project(s) P129996-ADD'L FINANCING - MUNICIPAL SERVICES IMPROVEMENT PROJECT ,P150342-ADDITIONAL FINANCING - MSIP (EU-IPA) 10/11/2019 Page 8 of 8