Kakheti Regional Development Program
Telavi Urban Regeneration
ABBREVIATED RAP
March 15, 2012
Municipal Development Fund Georgia
CURRENCY EQUIVALENTS
(as of 26 July 2011)
Currency Unit –lari (GEL)
$1.00 = GEL1.65
ABBREVIATIONS
ACS / – / Acquisition and compensation SchemeAB
AH / –
– / Affected Business
Affected Household
AP / – / Affected Person
CBO
CSC / –
– / Community Based Organization
Construction Supervision Consultant
DMS
EPARD / –
– / Detailed Measurement Survey
Environment Protection Analysis and Resettlement Division
GoG / – / Government of Georgia
GRC / – / Grievance Redress Committee
IA / – / Implementing Agency
IFI / - / International Financial Institution
IP / – / Indigenous Peoples
EMA / – / External Monitoring Agency
km / – / Kilometer
LARC / – / land acquisition and resettlement committee
RAP
MDF / –
– / Resettlement Action Plan
Municipal Development Fund
RPF / – / Resettlement Policy Framework
M&E / – / Monitoring and Evaluation
MFF / – / Multitranche Financing Facility
MOF / – / Ministry of Finance
MPR / – / Monthly Progress Report
MRDI / – / Ministry of Regional Development and Infrastructure
NAPR / – / National Agency of Public Registry
NGO / – / Non-Governmental Organization
PEMI / – / Persons Experiencing Major Impact
PFR / – / Periodic Financing Request
PPR / – / Project Progress Report
PPTA / – / Project Preparatory Technical Assistance
R&R / – / Resettlement and Rehabilitation
RoW / – / Right of Way
SES / – / Socioeconomic Survey
Table of Content
Executive Summary / 81 /
Introduction
/ 131.1 /
Project Background
/ 131.2 /
Telavi Subproject
/ 131.3 /
Expected Impacts and Applicable Resettlement Instrument
/ 151.4 /
Preparation of Abbreviated RAP
/ 161.5 /
Conditions for Project Implementation
/ 162 / Census and Impact Assessment / 16
2.1 /
Introduction
/ 162.2 /
Impact Assessment
/ 172.2.1 /
Impact on land, Crops and Trees
/ 172.2.2 /
Impact on Buildings and Relocation Needs and Strategy
/ 172.2.3 /
Business Impacts and loss of incomes
/ 182.2.4 / Vulnerable Project Affected Persons / 19
2.2.5 / Impact on Common Property Resources / 19
2.2.6 / Impact on Common Property Resources / 19
3 /
Legal and policy Framework
/ 203.1 /
General
/ 203.2 / Legal Framework / 20
3.2.1 /
Georgia’s Laws and Regulations on Land Acquisition and Resettlement
/ 203.2.2 /
WB’s Policy on Involuntary Resettlement
/ 213.2.3 /
Comparison of Georgian Legislation on LAR and WB Resettlement Policy
/ 233.2.4 /
Resettlement Policy Commitments for the Project
/ 243.2.5 /
Compensation Eligibility and Entitlements Eligibility
/ 244 /
Institutional Arrangement
/ 314.1 /
Introduction
/ 314.1.1 /
TelaviMunicipality
/ 314.1.2 /
Municipality Registration Office
/ 314.2 /
Other Organizations and Agencies
/ 314.2.1 /
Civil Works Contractor
/ 314.2.2 /
Court of Georgia
/ 314.2.3 /
Ministry of Finance
/ 324.2.4 /
Ministry of Justice
/ 324.2.5 /
The World Bank
/ 325 /
Consultation and Participation
/ 325.1 /
Introduction
/ 325.2 /
Summary of Consultation during SECHSA Study
/ 325.3 /
Consultation meetings with the APs during RAP Preparation and Disclosure of Draft Abbreviated RAP
/ 346 /
Grievance Redress Mechanism
/ 376.1 /
Objectives
/ 376.2 /
Grievance Resolution Process
/ 376.3 /
Formation of GRC
/ 377 /
Implementation Schedule
/ 388 /
Costs and Financing
/ 388.1 /
Compensation for Relocation
/ 388.2 /
Compensation for Business Interruption
/ 398.3 /
Summary LAR Cost and Flow of Funds
/ 399 /
Monitoring and Reporting
/ 409.1 /
Introduction
/ 409.2 /
Monitoring and Evaluation Indicators
/ 409.3 /
Level of Monitoring
/ 40Definitions
Beneficiary Community: All persons and households situated within the government-owned oracquired properties who voluntarily seek to avail and be part of theProject and represented by a community association that is duly recognized by the community residents, accredited by the localgovernment, and legally registered with the appropriate institutions.
Compensation: Payment in cash of the replacement cost of the acquired assets.
Entitlement: Range of measures comprising compensation, income restoration, transfer assistance, income substitution, and relocation which are due to Affected People, depending on the nature of their losses, to restore their economic and social base.
Improvements: Structures constructed (dwelling unit, fence, waiting sheds, animal pens, utilities, community facilities, stores, warehouses, etc.) and crops/plants planted by the person, household, institution, or organization.
Affected People (AP): Individuals affected by Project-related impacts.
Affected Household (AH): All members of a household residing under one roof and operating as a single economic unit, who are adversely affected by the Project. It may consist of a single nuclear family or an extended family group.
Affected Business(AB): Businesses affected by Project-related impacts.
Relocation: The physical temporary relocation of a AP/AH/AB from her/his pre-Project place of residence.
Relocation Cost: The value determined to be fair compensation for land based on its productive potential and location.. The replacement cost of houses and structures (current fair market price of building materials and labour without depreciation or deductions for salvaged building material), and the market value of residential land, crops, trees, and other commodities.
Mitigation Measures: All measures taken to mitigate any and all adverse impacts of the Project on AP’s property and/or livelihood, including compensation, relocation (where relevant), and rehabilitation of the damaged/removed infrastructure and installations.
Sakrebulo: Representative body of local self-government. The representative and executive branches of self-government are represented accordingly by Local Council (Sakrebulo) and the Gamgebeli of municipal level. The exclusive responsibilities of self-government include land-use and territorial planning, zoning, construction permits and supervision, housing, and communal infrastructure development.
Executive Summary
The main objective of implementation of RAP is to improve or at least restore the social and livelihood resources of the APs at their pre-project level. The process of implementation should ensure that this objective is achieved over a reasonable time with allocated resources. Therefore, monitoring of the process of RAP implementation and delivery of institutional and financial assistance to the APs has been designed as an integral part of the overall functioning and management of the Project.
The Government of Georgia has asked the World Bank to support financing of regional development project in Kakheti region. The proposed program of interventions will emphasize tourism and agriculture as two key pillars and drivers of economic growth. The proposed initial project will focus on support for the tourism sector and enabling the environment for the private sector to invest in Kakheti.
Telavi is historic town in the East Georgia, Kakheti region, in 160 km from Tbilisi. Telavi is a administrative center of Kakheti, historical region of East Georgia,
One component of Telavi subproject is restoration of buildings in the central part of the town. Conservation-restoration designs have been developed for the following 130 buildings in selected areas:
- Cholokashvili Street – 60 buildings.
- Erekle II street and Freedom square – 22 buildings
- Ilia Chavchavadze Street - 7 buildings
- Rustaveli, Lionidze, Anton Catholikos Streets – 13 buildings,
- Nadikvari Street – 28 buildings.
Expected Impacts and Applicable Resettlement Instrument
The project does not involve any permanent resettlement or physical relocation of affected households or businesses. Some residents, however, would be required to relocate temporarily during the restoration period, while the income of some businesses might be reduced. To mitigate any negative impacts on households and business welfare, this Abbreviated RAP was prepared in accordance to the WB OP/BP 4.12 and the RPF approved for the KRDP.
Consultations were conducted with residents and businesses in the planned project area. During the consultations, it was revealed that none of affected households or businesses prefers to be relocated to temporary accommodation facilitated by the project. All AHs were interviewed and they expressed preference for taking lump-sum compensation and finding accommodation on their own. All ABs agreed to take lump-sum compensation and continue to pay regular salaries to their employees. Before the launch of construction activities the information boards with contact requisites and addresses will be arranged in all business offices according to which employees will have information to whom to address in case of violation of their rights. The committee is entitled to consider all complaints and to have the final decision within 7 day period.
Based on the type of works envisaged, buildings are categorized into three types:
- Category I - Residents/users ofbuildings will not require temporary relocation;
- Category IIResidents/users of buildings will be given the option to relocate temporarily;
- Category III - Residents/users ofbuildings would be required to relocate temporarily.
The following 20 criteria are used to define the category of the buildings:
# / description of Works1 / Finishing of facade
2 / Installation of doors/windows
3 / Arrangement of balconies
4 / Strengthening of foundations and retaining walls outside the building
5 / Strengthening of foundation in basement (in non-residential area)
6 / Arrangement of seismic belt in attic
7 / Replacement of roof covering
8 / Partial replacement of roof structures
9 / Rehabilitation of fences and gates
10 / Strengthening of foundations and retaining walls inside the building
11 / Partial re-arrangement of load-bearing walls
12 / Complete replacement of roof structures
13 / arrangement of new floor (storey)
14 / arrangement of attic
15 / Arrangement of balcony and stairs, when access to the building is limited
16 / Extension and strengthening of openings
17 / Arrangement of new reinforced-concrete floor covering
18 / Arrangement of seismic belt at floor covering level
19 / Complete re-arrangement of walls
20 / complete demolition of building
Buildings that only involve works under items 1-9 belong to category I.
Buildings that involve any of the works under items 10-16, but not items 17-20 belong to category II.
Buildings that involve any of the works under items 17-20 belong to category III.
During the survey it has been specified that out of the total 130 buildings, 20 are of category I (resided by 8 households and occupied by 4 businesses), 96 buildings are of category II (resided by 79 households and occupied by 80 businesses), and 14 buildings are of category III (resided by 12 households).
Affected Households
Overall, out of the 99 households residing in the 130 buildings, 91 households will be affected for the duration of the project related civil works, of which 12 AHs live in Category III buidings requiring temporary relocation and 79 AHs living in Category II buildings who may be given an option to relocate temporarily. These AHs are eligible for a lump-sum compensation for renting and transport costs. The complete list of the 91 AHs is found in Annex 1. The 8 households residing in Category I buildings do not require temporary relocation and are therefore not considered as AHs.
Business Impacts and loss of incomes
There are 84 businesses operating in the 130 buildings (4 businesses in Category I buildings and 80 businesses in Category II buildings), which may experience loss of profits due to reduced number of customers during restoration work. Unlike the 8 households residing in Category I buildings who do not require temporary relocation and are therefore not considered as affected households, the 4 businesses operating in Category I building are considered as affected businesses, since they would experience loss of profit. Based on survey data, their loss is estimated to be maximum 20% of profit, and all businesses in affected buildings will be compensated for the expected maximum 20% decline of profits during 3 months (see Annex 1) with understanding that the businesses will be responsible for paying their employee’s
Compensation amount, which was calculated as 20% of profit was established with close consultations with business owners. All business owners assured that they are not going to decrease the amount of salaries to employees, andthat they are not going to give temporary leave to them. These provisions on the compensation for 20% loss of profit and the continued payment of salaries to employees will be reflected in letters of agreement, which will be signed by business ownersprior to the transfer of compensation funds. No construction work will commence on a building until (a) the letters of agreement are signed by the owners of businesses operating in the building and (b) compensation is paid to them. If business owners incur loss of profit greater than 20% during the period of disruption and can demonstrate it with verifiable proof, they would be able to request additional compensation through the grievance redress mechanism described in the RAP.
Vulnerable Project Affected People
Of the 91 affected households residing in Category II and III buildings,16 belong to the group of vulnerable people (i.e., all of them are below poverty line). All of these 16 AH are living in Category II buildings and they are eligible for an additional one time allowance equal to a monthly minimum subsistence income for a family of five.
Costs and Financing
Compensation for Temporary Relocation
Households residing in Category I buildings do not require temporary relocation, and are therefore not considered as AHs. The 79 households residing in Category II buildings are eligible for lump-sum compensation equivalent to the renting cost of 3 months plus a transport cost of GEL 200. The 12 households residing in Category III buildings are eligible for lump-sum compensation equivalent to the renting cost of 6 months plus a transport cost of GEL 200. Based on information sought from real estate brokerages in Telavi, The monthly renting cost by size of family is calculated as follows:
- Group I (Household of 1-2 persons) – GEL 330;
- Group II (Household of 3-4 persons) – GEL 500;
- Group III (Household of 5-6 persons) – GEL 850;
- Group IV (Household of 7+ persons) – GEL 1,100.
The total amount of compensation for the cost of temporary accommodation (without transportation) for 91 AH is 164,700.00 GEL (see attachment). The total amount of compensation for transportation cost of these AH is GEL 18,200. All together, the total amount required in compensation for temporary relocation of 91 AHs would be: GEL 182,900.
In case the period of disruption lasts longer than anticipated, the contingency funds will be available to cover additional compensation costs equivalent to three-months of compensation for all AHs in category II buildings.
Compensation for Business Interruption
The 84 owners of the temporarily affected businesses are eligible for compensation of business profit losses corresponding to the period of disruption to businesses. The losses are valuated based on tax declaration, or in case of absence of such proof, based on minimum subsistence income for the households consisting of 5 persons. Amount of business employees affected by the project is 0, since all employees will be paid their regular salaries by the business owners receiving the compensation of 20% profit loss.
Compensation for expected losses due to decline of business activities (20% of net monthly profit multiplied on 3 months) for 84 businesses constitutes GEL 142,846.
In case the period of disruption lasts longer than anticipated, the contingency funds will be available to cover additional three months of compensation costs.
Allowances for Vulnerable People
The 16 vulnerable households will be paid GEL 313 each (1 month of social assistance).
The Total cost for allowances is GEL 5,008.
Summary LAR Cost and Flow of Funds
The table below summarizes the types and amounts of compensation and allowance to be awarded to the project affected households and businesses. In addition to the total amount stated in the table, contingency funds of GEL 124,980 (equivalent to the compensation for renting cost of Category II households) and GEL 142,846 (equivalent to the compensation cost of affected businesses) will be made available. The Government has agreed to make these compensations in lump-sum.
Compensation Entitlement Matrix
Affected Households (AHs): Occupants (including owners and renters) residing in affected buildingsBuilding Category / Household Size / Number of HHs / Compensation Measure / Total Compensation Cost
Category I (0 AHs):
No relocation required. Works cause no considerable restriction of living conditions of inhabitants, discomfort or infringement of sanitary standards. No impact on safety of population. / Groups 1-4 / 8 (not counted as AHs) / None / GEL 0
Category II (79 AHs): Temporary relocation of inhabitants may be needed. Works restrict living conditions of the inhabitants to an extent. Infringement of sanitary standards is expected in certain cases. Possible impact on safety of population. / Group 1
(1-2 persons) / 32 / Lump-sum compensation of
GEL 990 (GEL 330 rental cost x 3 months) &
GEL 200 (relocation cost) = GEL 1,190 per AH / GEL 38,080
Group 2
(3-4 persons) / 31 / Lump-sum compensation of
GEL 1,500 (GEL 500 rental cost x 3 months) &
GEL 200 (relocation cost) = GEL 1,700 per AH / GEL 52,700
Group 3
(5-6 persons) / 8 / Lump-sum compensation of
GEL 2,550 (GEL 850 rental cost x 3 months) &
GEL 200 (relocation cost) = GEL 2,750 per AH / GEL 22,000
Group 4
(7+ persons) / 8 / Lump-sum compensation of
GEL 3,300 (GEL 1,100 rental cost x 3 months) &
GEL 200 (relocation cost) = GEL 3,500 per AH / GEL 28,000
Category III (12 AHs): Inhabitants require temporary relocation. Works considerably restrict living conditions of the inhabitants and infringes sanitary standards. Safety of the inhabitants may not be secured. / Group 1
(1-2 persons) / 4 / Lump-sum compensation of
GEL 1,980 (GEL 330 rental cost x 6 months) &
GEL 200 (relocation cost) = GEL 2,180 per AH / GEL 8,720
Group 2
(3-4 persons) / 5 / Lump-sum compensation of
GEL 3,000 (GEL 500 rental cost x 6 months) &
GEL 200 (relocation cost) = GEL 3,200 per AH / GEL 16,000
Group 3
(5-6 persons) / 2 / Lump-sum compensation of
GEL 5,100 (GEL 850 rental cost x 6 months) &
GEL 200 (relocation cost) = GEL 5,300 per AH / GEL 10,600
Group 4
(7+ persons) / 1 / Lump-sum compensation of
GEL 6,600 (GEL 1,100 rental cost x 6 months) &
GEL 200 (relocation cost) = GEL 6,800 per AH / GEL 6,800
Subtotal / 91 / Lump-sum compensation / GEL 182,900
Affected Businesses (ABs): Owners of businesses operating in the affected buildings
Building Category / Number of Affected Businesses / Compensation Measure / Total Compensation Cost
Category I / 4 / Lump-sum compensation for 20% monthly profit based on tax declaration x 3 months / GEL 4,194
Category II / 80 / Lump-sum compensation for 20% monthly profit based on tax declaration x 3 months / GEL 138,652
Category III / 0 / Lump-sum compensation for 20% monthly profit based on tax declaration x 6 months / GEL 0
Subtotal / 84 / Lump-sum compensation / GEL 142,846
Vulnerable People: Households living below the poverty line residing in the affected buildings
Building Category / Number of Vulnerable Households / Allowance / Total Compensation Cost
Category I / 0 / None / GEL 0
Category II / 16 / Allowance of GEL 313 (minimum subsistence cost of 1 month) per Vulnerable Households / GEL 5,008
Category III / 0 / Allowance of GEL 313 (minimum subsistence cost of 1 month) per Vulnerable Households / GEL 0
Subtotal / 16 / Allowance / GEL 5,008
Grand Total
Grand total / GEL 330,754
1.INTRODUCTION
1.1Project Background
Following four years of rapid growth, backed by far-reaching reforms and strong financial investment inflows, Georgia experienced a sharp economic downturn resulting from the August 2008 conflict and the global financial crisis. Economic recovery is underway, with growth of an estimated 6.3 percent in 2010. The authorities responded to the downturn with a countercyclical fiscal stimulus coupled with a marked reallocation of public expenditures toward social and infrastructure investments. As economic recovery takes hold, driven by higher exports and private investment, the authorities are winding down the stimulus and implementing fiscal adjustment to safeguard sustainability. There is, however, uncertainty regarding the pace of economic recovery. Georgia will need to refinance a public debt amortization spike in 2013. The authorities are addressing these vulnerabilities through well designed fiscal, monetary and debt management policies. Infrastructure projects are considered by the Government as part of the physical stimulus package.