Page 1 Page 1 of 29 Resettlement Action Plan Prepared by Sub-con tractor of BONIFICA, Tbilisi Title Company Ministry of Economic De velopment of Georgia Department of Roads of Georgia Tbilisi June 2007 Georgia Tbilisi-Senaki-Leselidze Auto Road Agaiani-Igoeti E43 – E55 Section RP463 v 3 Page 2 Page 2 of 29 Ontents C Chapter Page 1. Preface..................................................................................................................... 3 2. Scope of Land Acquisition..................................................................................... 4 3. Project Affected People........................................................................................5 4. Legal Framework .................................................................................................... 7 5. Gaps between the active legislation of Georgian and meas ures to fill the gaps........................................................................................................................... ...9 6. Compensation Principles and Rehabilitation Me asures…………………………10 7. The Scope of Project Impact and Valuation Methdology……............................11 8. Implementation Proc edures……...…………………………......... ................... ........16 9. Public Meetings, Participation and Grievance Redress Mechanism……………............. ................... ................... ................ ................ ............19 10. Entitlement Matrix...............................................................................................21 11. Households Socio-Demography data...............................................................22 12. Annexes ..............................................................................................................25 13. Budget ................................................................................................................31 Resettlement Action Plan Page 3 Page 3 of 29 Preface The Resettlement Action Plan has be en prepared by the Road Department of Ministry of Economic Development of Georgia in accordance to the Re- settlement Policy Framework (RPF), active legislation of Georgia and World Bank involuntary resettlement policy (OP 4.12). The assignment covers Tbilisi-Senaki-Leselidze auto road section Agaiani-Igoeti E43 and E55. The goal of the hereby document – Resettlement Action Plan – is to in de- tail describe all the actions and activ ities to be undertaken by the RDMED in order to follow logical and fair a pproach in the process of implementing involuntary resettlement when identify ing the compensation measures and entitlements for land expropriation and reimbursement of income and asset losses. Aside to that, due information shall be provided to all responsible institutions involved in the process, representatives of local government and the most important local population th at shall experience direct impact of the given project. The individuals that lose the means of livelihoods and income sources (Pro- ject Affected Persons: PAP) shall receive compensation, either by cash or in-kind, to at least restore their pre- project level of li velihood. During the project implementation process, specific mitigation measures shall be em- ployed to minimize temporary worsen ing of economical conditions of the project affected people. 1 Resettlement Action Plan Page 4 Page 4 of 29 2. Scope of Land Acquisition The given road section geogra phically is located on Agai ani-Igoeti section and ac- cording to the administrative-territorial di vision belongs to Kaspi rayon. In total twenty-three PAP shall be impacted by the Road rehabilitation activities. These land parcels are located on the territories of the villages of Agaiani and Okami. The total number of the land parcels located w ithin the Road Impact area equals to twenty- three. Out of these twenty-three only 2 land parcels are non-agricult ural. The rest 21 land parcels are agricultural. Among them only one land parcel is under State ownership and leased to the physical person. The rest twen ty land parcels are priv ately owned and used by local households. The survey of the land parcels located with in the Road Project affected area revealed four cases when the landowners occupy and us e larger size of land than it was legally allocated to them during the land privatizati on process. The excess share of the land parcel that will be within the new ROW is owned by the state. Since the excess share of the land is occupied by the local househol ds without title, no cash compensation will be provided as land replacement cost, al though the PAP shall receive the reimburse- ment for the loss of assets and income loss. The project road is carefully designed so th e impact that may arise from the road con- struction on the local population is minimize d, and the future utilization and productiv- ity of local assets will not be deteriorated. 2 Page 5 Page 5 of 29 3. Project Affected Persons During the development of the Resettlement Ac tion Plan, as a result of the special survey the socio, economic and demographic data have been collected for the Project Affected Persons. The survey revealed that the majo rity of the households possess agricultural land parcels. However, not all of the PAP have the complete package of documents to be recognized as legal owners under the Georgian legislation. Th e demarcation revealed that some of the landowners are deceased and th eir land parcels had been inherited by their heirs without prope r registration. A significant number of PAP is pensioners. Some of their younger family members are employed. Only several households deal wi th cattle breeding. Almost every household cultivates land and feeds themselves and their family members. They grow various vegetables (onion, garlic, toma to, potato, corn and bean) and share the crops with their children who live separately. Some househol ds sell a large share of annual crops such as beans, corn and grapes at the local market or to wholesalers in Tbilisi. 3 Page 6 Page 6 of 29 Most of the houses were built in 1955-1965. These are two-storied building with 4 to 6 rooms. However, the population still pref ers to live on the ground floor. This is con- venient to local households as in winter the wood stove placed in one room is the most optimum option to warm the shelter. People use the same stove for cooking as well. On two non-agricultural land parcels on the left side of the project road exist two com- mercial entities that will be affected by road construction activities. These are (i) Res- taurant TAVKVERI, and (ii) Petrol station owned by IBERCOMPANY. The Restaurant is privately owned by SA VANE XXI which also owns the land on which the restaurant is built. The restaurant is leased to an individual entrepreneur who runs the business. Page 7 Page 7 of 29 The petrol station is privately owne d and managed by IBERKOMPANI LTD which also owns the land. 4. Legal Framework In Georgia the legislative ac ts given below regulate the i ssues related to legal owner- ship rights to land and real property and the expropriation of land for public needs: x The Constitution of Georgia, August 24, 1995 x The Law of Georgia on the Rules for Expropr iation of Ownership for Necessary Public Need, July 23, 1999 x The Law of Georgia on Ownership Right s to Agricultural Land, March 22, 1996 4 Page 8 Page 8 of 29 x The Law of Georgia on Regi stration Ownership Rights to Immovable Property, De- cember 28, 2005 x The Civil Code of Georgia, June 26, 1997 x The Civil Procedural Code of Georgia, November 14, 1997 x The Law of Georgia on Privatization of St ate-owned Agricultural Land, July 8, 2005 These legislative acts create the set of proce dures that allow the Road Department of Georgia to obtain ownership right towards the privately owned land parcels and corre- spondingly the right of way. The Law on acquiring ownership rights that defines the process of expropriation re- quires implementation of several steps. a. Issuance of Presidential decree; b. Inventorization of all the pr operty subject to expropriation; c. Disclosure of inform ation on expropriation; d. Providing the information on expropriation to landowners; e. Submission of the Application to the Court and Court Decision; f. Expropriation; g. Court proceedings in case any disputes are raised in re gard with the property value (amount of compensation). A. As a result of issuance of Presidential Decree the right of expropriation is granted to a company or a legal person of public la w. The Presidential Decree is issued under the Article 21 of the Constituti on of Georgia. The Presidential Decree defines the inevi- tability of expropriation of a land parcel fo r immediate public needs and the subject (le- gal or private person) that may be granted the right of expropriation. B. After issuance of Presidential Decree in ventorization and evaluation of all the property subject to exprop riation shall be conducted C. The information on the expropriation is published at national and local news- papers. The information shall contain the scopes of th e project, and brief description of the ter- ritory and property that may be expropriated. D. After the information on expropriatio n is published, the corresponding package of documents shall be delivered to land owners . In particular, the document of property va luation by the independe nt expert; offer on the purchase of the property subject to e xpropriation; and the amount of compensation that should be handed over to land owners will be delivered. E. The Application shall be submitted to the Court and property expropriation under- taken after the above describe d activities are implemented . The Law of Georgia on the Rule of Property Expropriation for Necessary Public Needs, article 5 defines that the District (City) Court will finally assign th e right of expropriator. The Application on expropriation shall be submitted to the District (City) Court. The Court shall make a fi- nal decision on the issuance the right of expr opriator. The application submitted to the Court shall state the following: 1. Name of the District (City) Court; 2. Name and legal address of the of applicant; 3. Name, address of the Applic ant’s representative if the application is submitted by a representative; Page 9 Page 9 of 29 4. The request of the applicant; 5. The description of the circum stances the applicant refers to; 6. The proofs verifyi ng these circumstances; 7. The list of the documents attached to the Application. The application for the right of expropriation shall contain the following data: detail de- scription of the property that needs to be e xpropriated, the Extract from the Public Reg- ister verifying ownership right, documents rela ted to the project to be implemented for necessary public needs and the Decision of th e District (City) Court on grating of the right of expropriation. F. Court Proceeding due to the property value In case the expropriator and the property owne r fail to come into agreement regarding the property market value and amount of comp ensation, either party has the right to ap- ply to the same rayon court where the land parc el is located for dispute resolution in ac- cordance to the Civil Proce dural Code of Georgia. The Court will assign an independent expert that shall conduct property appraisal and submit the report on property market value w ithin the defined time. On basis of the re- port by the independent expert and the proof s provided by both parties, the court will make the final decision regarding the amount of compensation of th e property subject to expropriation. The expropriator is responsible to the reim bursement of the costs incurred by both par- ties including the costs for court proceedings, su ch as court costs in case of disputes and the costs for the services for appraisal of the property to be expropriated. 5. Gaps between active Georgian legislation and measures to fill the gaps As stated in the Resettlement Policy Framew ork (RPF), most World Bank resettlement policies are adequately addressed in Georgian law. One major gap is that under Geor- gian law, those land owners who fail to have their land registered at the Public Registry are not eligible for compensation. Also, Ge orgian legislation doe s not require specific planning process and planning instruments that are specified in OP 4.12. Similarly, no specific measures for public consultati on are provided under the Georgian law. Page 10 Page 10 of 29 With view to such gaps, RPF sets forth se veral measures to fill the gaps, such as: x Keep affected people and communities fully informed about the project, the process that will be followed to acquire and compen sate for land, and their related rights and avenues for redress. x PAP will be notified of th e project implementation sche dule and consulted regard- ing the principles of land acquisition and loss of/ damage to assets. x Develop a fair and accessible grievance redress mechanism. x All PAP will receive compensation or suppor t of various kinds, without regard to the status of land regi stration and ownership in complian ce with the active legislation of Georgia and the World Bank safeguard policy. This RAP sets forth specific measures to fill the gaps based on the principles laid out in the RPF. 6. Compensation Principles and Rehabilitation Measures The following principles are used to deve lop the methodology to evaluate lost assets and properties. 1. The given project impact does not exte nd on residential houses; therefore, physical resettlement of local popul ation is not expected. 2. Persons shall receive cash compensation fo r the share of the land parcel subject to expropriation due to road construction. Land replacement cost has been determined ac- cording to the market price. 5 6 Page 11 Page 11 of 29 3. Cash compensation shall be issued for the loss of annual income. Loss of annual crops and vegetables has been calculated base d on the average market price of the yield to be lost due to road constriction. Cash compensation amount is determined according to the data of the last five years, in partic ular considering the Data of the Department of Statistics on average market prices for th e years 2000-2006. Compensation shall be paid to cover loss of income over one year. 4. Compensation for the loss of assets: A. cash compensation shall be paid to th e fruit bearing perennials to be logged down due to road construction. The amount of co mpensation is compensated according to the method described in the Chap ter 7 on valuation methodology; B. cash compensation shall not be issued for the perennials not bearing fruits. How- ever, the owners shall have the right to dis pose the timber at their discretion after con- struction company ensures to log the tree s down and deliver the timber to the land- owner’s residential area at company costs. 5. Rehabilitation measures: 5.1. Where the landowner and/or users possess st ructure, building or fence that will be removed, such structure, buildings, fences sh all be moved to other location or restored at the costs of the RDMED, or cash compensa tion shall be provided that is sufficient to restore the structure. 5.2. The construction company is responsible to arrange temporary access roads, so that the loss of income for local population due to temporary lack of access road is mini- mized. In case the population is not able to us e their land parcels and this lasts for more than one year, then the construction comp any shall reimburse the loss of income. 6. Actual removal of the specific structure and/or physical acquisition of the land shall be undertaken after the completion of issu ance of compensations for lost assets. 7. All project affected pe ople (PAP) will be compensated under the active Georgian legislation and World Bank safeguard policies (OP 4.12). 7. The scope of project impa ct and valuation methodology The area that will be impacted by the Tbi lisi-Senaki-Leselidze motor road construction include privately owned land a nd state-owned land leased to an private individual and extend over the 43 -55 KM section of th e road between Agaiani and Igoeti. The detailed surveys and inventorization al lowed determining the types and level of project impact over the land parcels across the existing road. The calculation of com- pensation has been conducted based on th e Valuation Methodology and the identified level and types of losses. The Valuation Methodology has been prepared according to 7 Page 12 Page 12 of 29 the active legislation of Georgia and in compliance with the World Bank Involuntary Resettlement Policy Framework (OP 4.12). Within the given Project the following types of project impact have been identified: 1. Loss of annual income 2. Loss of Assets – removal of buildings, structures and pe rennial crops to be logged down due to road rehabilitation activities 3. Loss of land i.e. involuntar y acquisition of land parcel 4. Temporary loss of income caused by temporary loss of access. Characteristic of the types of loss es and principals of compensation Compensation for loss of annu al income – yield from annu al crops lost due to road construction Some of the land parcels under project impa ct are cultivated. The owners have already started the agricultural activities of the current season, and they may not be able to har- vest the yield they planted prior to the start of road construction activ ities. In such case the compensation shall be paid for the loss of annual income. The amount of compensa- tion shall be determined based on the market prices of the lost crop. As the source of the information on the market prices, data of the Department of Statistics for average annual consumer prices for the years of 2000-2006 have been utilized. (Please see Ta- ble 1 and Table 2) Loss of assets: Structures and perennials Buildings and structures to be removed The loss of or damage to structure and buildi ngs is also expected due to road construc- tion. Within the scope of the project imp act area there are two commercial objects lo- cated across the existing road: the restaura nt TAVKVERI that is owned by the legal person SAVANE XXI, Ltd and petrol stati on LUCOIL that is owned by the legal per- son IBERCOMPANY Ltd. These two commercial objects are located on the land par- cels registered as non-agricultural. In order to implement road rehabilitation act ivities, the acquisition of some part of the land parcel is required. The impact shall not extend to the main buildings. However, as a result of the detailed fiel d study carried out by the consul tant, it is found that some structures, such as WC, underground oil reservoi rs, and water and oil pipes, will need to be demolished if local roads are build in 2008 as planed under the preliminary design of the road. It has been decided that the alignment proposed under the preliminary design will be re-routed to avoid such demolition of structure. Compensation for the loss of perennial fruit trees This type of loss includes the compensation fo r perennial fruit trees that shall be logged down due to road construction activities. The calculation of compensation is based on the following formula: Step 1 Cost to purchase one seedling of the respective fruit tree X (multiplied by) Number of seedlings to be purchased (3GEL/ seedling) Page 13 Page 13 of 29 = (equals to) Cost to purchase new seedlings (A) Step 2 Annual harvest from a fruit tree (in kg) X ( multiplied by) Market price of the fruit (1 kg/GEL) = (equals to) Market Value of Annual Income Step 3 Market Value of Annual Income X (multiplied by) The number of years required to achieve the same productivity = (equals to) Income lost during when new a se edling does not produce fruits (B) Step 4 (B) X the number of seedlings = Total amount of income loss before the seedlings reach maturity age (C) Step 5 (A) +(C) = The replacement cost of lost fruit tree Based on this formula the amount of compensati on is calculated for each fruit bearing perennial that shall be logged due to road construction. The data on average market prices on fruits, annual yield and maturity year s of perennial fruit trees are presented in the table attached to the documents. (Pleas e, see Table 3). These materials have been prepared by the Doctor of Agricultural Science, full member of Academy of Agricul- tural Science of Georgian an d Russian Federation, laureate of State Prize of Georgia. Mr. Gogotur Agladze. Source: Monograph on Fruit-growing in Georgia; Volume III (1973) and Volume IV (1978) the group of authors; edited by Academician N. Khome- zurashvili. The example below de scribes the methodology of calc ulating the amount of cash compensation for the fruit be aring perennials th at need to be logged down due to road construction activities. There are five standing peach trees in their full productivity age on the part of the land parcel to be acquired due to road constructi on. These five peach trees need to be logged down and cash compensation be provided. The compensation amount shall be calculated according to the following formula given above. The full productivity age of a peach tree starts from 6-7 years. Annual yield capacity per one tree equals to 40-50 kg. Average market price per 1 kg peach is 1.70 GEL. Market research proved that a three-years-ol d seedling can be purchased for 2-3 GEL at the local market. The owner shall receive the additional amount to purchase the seed- lings. That means that every PAP shall recei ve extra 3 GEL /per each fruit bearing tree cut down as a cost to purchase a new seedling. Page 14 Page 14 of 29 In order to reach full productivity age, a 3 years peach tree seedli ng will need extra 4 years. Therefore, instead of seven years it will re quire only 4 years to reach the full productiv- ity age. According to the formula given above the to tal amount of compensation for fruit bear- ing perennials shall be calculated a ccording to the following formula: Step 1 Total cost to purchase 5 seedlings will be equal to: 3GEL X 5 seedling= 15 GEL Step 2 Annual income loss per one fruit tree will be equal to: 40 kg X 1.70 GEL = 68 GEL Step 3 The lost income before a seedling starts to produce fruits will be equal to 68 GEL X 4 years = 272 GEL Step 4 The total lost income before seedlings st art to produce fruits will be equal to 272 GEL X 5 seedlings = 1360GEL Step 5 The total amount of compensation due: 15 GEL + 1360 GEL = 1375 GEL The total compensation amount for these five peach trees shall equal to 1360 plus 15 GEL for purchase of five seedlings to repl ace the five logged down peach trees equals to 1375 GEL. The amount for compensation for loss of fr uit perennials has been calculated based on this approach efficient in timing and costs. Loss of land i.e. involuntary acquisition of the part of the land parcel Cash Compensation for permanent loss of land within the project affected area had been calculated based on the market prices on la nd. The market price on land is defined based on the internationally proven method – Sales Comparative Approach. This me- thod is widely used as international practice and uses comparative an alyses of the prices of land parcels sold and/or listed for sales. During the research of specific market segm ents, several specific factors have been re- vealed that required close consideration. In particular, pursuant to the Order dated as of January 9, 2006, Road Department of the Ministry of Economic Development of Geor- gia, the government has stopped issuing the construction permits across the road, and prohibited new registration of transactions on real property at the Public Register. As a result, real property market at the given market sub-segmen t is less active than under normal condition. Page 15 Page 15 of 29 It is quite characteristic of local communities that the sa les transactions are undertaken only on a verbal agreement and the legal side of the transaction are neglected. This causes the scarcity of offici al information on sales prices of actually undertaken sales transactions to land. Considering the described circumstances, it was required to extend the geographic area of research. As the source of informati on on similar land parcels, public announcements available on newspaper, and informal conversat ion with individuals interested in sales of their properties and with the individuals that recently purchased agricultural land par- cels are utilized. The research clearly showed that land parcels that may be utilized as leisure (to build summer house) are more expensive than those land parcels that are used for agricultural purposes. Aside to that, it is well known in real propert y practice that the sales price suggested by the individual interested in sales of thei r property as a rule exceeds for 15-25% the amount being actually paid. However, no PAP unde r the project can be considered to be a volunteer owner-seller. Agricultural land parcels Most land parcels affected by road project ar e similar in their characteristic features which allow using common parameters in de termining market price. Among twenty- three land parcels, twenty-one are of agricu ltural designation. The land parcels that will be acquired are located over 12 kilometer of the project road. Their common character- istic features are soil productiv ity, location and designation. Therefore, the following parameters ha ve been selected for comparison: 1) size of the land parcel to be acquired 2) sales price suggested by the owner 3) price per 1 square meter 4) location 5) access to road 6) close location to irrigation channel Through the adjustment of the information co llected for these parameters, the approxi- mate market price range has been determined. Table provided under the Annex 4 is prepared based on the Market Price Comparative Analyses method. Under the fi rst column “comparables”, th ose general parameters that are applicable to all twenty-one project impacted land parcels are determined. The sec- tion with the general title “the land parcels listed for sales” provides the characteristics of seven land parcels selected for comparison. The land parcels under the No.2, 4 and 6 are not comparable with the land parcels af- fected by the project. Land parcel No. 2 has not been cultivated for a long time; the land parcel is far from the main road and sett lement area and is not irrigated. The land parcels No. 4 and 6, although they are similar to project affected plots in that they are irrigated and located close to main road and settlement areas, they are used as vine- Page 16 Page 16 of 29 yards. The characteristic features of the remaining four land par cels closely match the land parcels located within the Road Project impacted area. The price range is as follows: No. 1 – 3.00 GEL/1 sq/.m No. 3 – 4.00 GEL/1 sq/.m No. 5 – 2.28 GEL/1 sq/.m No. 7 – 3.20 GEL/1 sq/.m Average of these figures is 3.12 GEL/sq.m. Considering the average price range of these land parcels and the gene ral difference between offered price and sales prices, it has been determined to set 3 GEL / square meter of agricultural land, as land replace- ment cost for permanent loss of land. Non-agricultural land The market price of non-agricultural land parc els where petrol sta tion and restaurant operate is significantly higher than that of agricultural land. This is caused by their des- ignation and category as non-agricultural land. There are specific procedures that are required to be undertaken to change the design ation of a land parcel from agricultural to non-agricultural and the fees shall to be pa id that equals to several thousand GEL per hectare. Tbilisi Title Company conducted some market re search utilizing the same sources of in- formation and methods. As a result of the re search Tbilisi Title Company expert sug- gested the sales price range varying between 8-12 GEL/square meter for non- agricultural land in the given market segment. Temporary loss of income due to lack of access road The construction of project road will cause te mporary loss or restriction of access to the two commercial entities that ex ist along the project road. The contractor will build tem- porary access road to allow access to such commercial entities from the motorway. Where alternative access such as local roads doe s not exist, the contractor will also in- stall temporary access road during constructi on to ensure mobility of local people who farm the land located or graze domestic anim als at the other side of the road. RDMED will monitor the installation of access road. Page 17 Page 17 of 29 8. Implementation Procedures A. Identification of landowners of the land parcels located within the East-West Magistral Road Reha bilitation Project In order for RDMED to acquire the owners hip to land parcels through legally valid manner, a field survey needs to be carried out to determine offici al (legal) landowners and the location of their land parcels, and a ll documents to legally establish the owner- ship needs to be collect ed. This is because: o As the majority of land parcels - within ne w road construction corridor – are classified as agricultural land, they do not have co rresponding addresses registered at the local Public Registers. This is the rule establis hed for processing the registration of owner- ship rights to agricultural land parcels in rural areas. o The quality survey maps prepared by the licen sed surveyor still required to be checked and re-surveyed on site to determine the exac t locations and boundaries of land parcels. o Updated list of land owners also proved not to be available at the local Public Register. o Land owners possess legal documents that ve rify their land ownership but they are not sufficient to prove their land ownership under the Georgian legislation, since Registra- tion Cards and Cadastral Maps are not adequa tely recorded and kept at the Public Reg- ister of Kaspi Rayon. Tbilisi Title Company team vi sited the site and conducted th e field survey to demarcate land parcels. The landowners, the owners of th e adjacent land parcels, official represen- tatives of the local self government and the Survey Company participated in the field survey. Each landowner pointed the location and boundaries of the land parcels that was endorsed by the owner of the adjacent la nd parcel and witnesse d by official repre- sentative of the local municipality. The la nd parcels were then surveyed after the boundaries had been established. The surv ey was undertaken by a licensed company, ALIGATOR. In parallel with determination of the la nd parcels and their owners, the Demarcation Acts have been developed on site. The Dema rcation Acts have been designed by Tbilisi Title Company and utilized in the process of onsite demarcation. The sample of the Demarcation Act is attached to the hereby RAP under the Section Annexes. These Acts have been signed by the landowner, the owners of the adjacent land parcels and the rep- resentative of the local self-government (M unicipality Rstmunebuli). The sample of the Demarcation Act is provided u nder the Section Annexes. Th e new Cadastral Maps have been prepared afterwards. The new and exis ting cadastral maps have been compared and checked. Demarcation Acts together with the Cadast ral Map served as the basic documents for fixing the land parcel within UTM Coordina te system. Further, the demarcated land parcels on the basis of these Cadastral Maps are being registered at the Registry Office of Kaspi rayon Public Register. B. Census and Inventorization After the land parcels and their owners have been determined and the final list of the Project Affected People (PAP) reviewed and fulfilled the number of Project Affected People and land parcels located w ithin the Project Affected ha ve also been determined. 8 Page 18 Page 18 of 29 In the process of inventorizat ion, land parcels and real prope rty (structure-building; per- ennials) attached to them have been record ed and inventoried, and the market value of these assets have been determined. The list of assets that will be affected is attached to the RAP. C. Initial registration of ownershi p rights into the Public Register Identification of land owners and determinatio n of boundaries enable the registration of land parcels and the names of their owners at the Public Register, which is necessary to undertake the purchase and expr opriation of land parcels as per the Law of Georgia on the Rules for Expropriation of Ownership fo r Necessary Public Need, July 23, 1999 (#2349-rs) and the Law of Georgia on Regist ration of Ownership Rights to Immovable Property (#2635-rs), December 28, 2005). Accord ing to the laws, ownership right is de- clared legally valid only after it is regist ered at the Public Register, or the sales- purchase agreement is not legally valid under ac tive legislation. Thus all the rights iden- tified under the Law on Registration of Owners hip Rights to Immovabl e items, such as below, are subject to registration : A. Ownership rights acquired to immovabl e items through purchase, exchange, be- queath (giving as a gift), contract-based, id entification of owners hip rights, privatiza- tion, as well as obtaining ownership rights registered at the Public Register. B. Right to build, usufruct, mortgage and gua rantee rights, also th e rights to rent or lease immovable item created based on the notarized agreement. As a result of demarcation, landowners 1 of each land parcel have been determined. The landowners, however, must then undertake initial registration at the Public Register to stand as legally valid owners. Land parcels an d the names of their ow ners will be regis- tered at the Public Register based on the signed Application. At the same time the Road Department of Georgia will eliminate the rest rictions being in forc e due to the Letter no. 2/23 dated January 9, 2006 against the pe rsons identified as the Project Affected Persons. The representative of Tbilisi Title Company collected copies of the documents and the Identification Cards of the PAP that should be submitted to the Publ ic Register to regis- ter their land ownership. The originals of these documents are held by the landowners. The landowners will immediately undertake the initial registration of ownership at the Public Register once the restrict ion on land transaction is lifted. The following documents should be submitted to the Public Register for initial registra- tion: 1. Documents that verify ownership rights: Receive-Delivery Act; or Landowners’ List; or Tax payers’ List; or Land (Real Property) Ownership Certificate (original that may be kept at the village Sakrebulo, Rayon Gamg eoba or already issued to the landowner). 2. Land parcel Demarcation Act, verified with the signatures of the representatives of the local government, which determines the locati on of the land parcel and the name of the owner of the adjacent land parcels. 3. Survey Map in UTM coordinate system prepared on the basis of the corresponding land parcel Demarcation Act 4. Original and a copy of the Landowner’s Identification Card 1 See the list of the landowners in the Table No. 1 Page 19 Page 19 of 29 In case a landowner is deceased , then the initial registra tion will be conducted on the name of deceased person in accordance to th e rules described above and afterwards the measures necessary for inheritance shall be undertaken. The inheritance of properties will be conducted pursuant to the Article 1323 of the Civil Code of Georgia. For in- stance, the Komli (family) owns a piece of la nd within the project impact areas, but the head of the family, under whose name the la nd has been registered , has been deceased. The land will be first register ed under the name of the new head of the Komli (family). The following documents must be submitted to the Public register for conducting the registration: 1. Application; 2. Receive-Delivery Act; or Land Distribution List; or Tax List active in the registration period approved by the self-government (gove rnment) bodies for usage the land for ag- ricultural means; or Land Di stribution List without graphi cal approval of the land allo- cation; 3. Statement or Extract from the Komli records on the contents of the members of Komli; 4. In case any member of Komli is deceased , the document verifying this fact; 5. Cadastral/Inventory sketch of the land parcel and the structure-building; 6. Copy of the Identification Card. After the procedure for inheritance is comple ted, payment of comp ensation will be con- ducted as others. D. Valuation Methodology and calc ulation of Compensation Amount The size and scale of the properties that will be expropriated and the assets that will be lost are established through the inventoriza tion, and the amount of compensation that the RDMED will offer to PAP has been calc ulated using a valuation methodology de- scribed in Section 7 of the RAP. The exact amount of compensation payable to respective PAP is determined based on the negotiation between the RDMED and PAP, and it will be entered into the sales- purchase agreements. E. Expropriation/ compensation If negotiation fails, RDMED w ill enter into the second phase of land acquisition, which is land expropriation. The Constitution of Georgia establishes th e right to involuntary expropriation of property for public needs in the process of magistral motor road con- struction. The process of expropriation wi ll be implemented only under the Decree of the President of Georgia and appropriate C ourt level. Expropriation can be undertaken only after the compensation that is fair and e qual to the market value is paid to the rele- vant land owners. The State of Georgia has the Constitutiona l right to take away any property through expropriation and pa yment of fair compensation in return (Article 21). The Law of Georgia on the Rules for Expropr iation of Ownership fo r Necessary Public Need (July 23, 1999) defines th e procedures, obligations and the rules of implementa- tion of expropriation. The permit on property expropriation is issu ed by the District (City) Court Decision on the basis of the Presidential Decree. Page 20 Page 20 of 29 The project shall resort to property expropria tion only in exceptional cases as the last resort: (i) when negotiation over the purchase price of land and other project affected properties fails; and (ii) re-alignment of the ro ad is impossible. The mechanisms of ex- propriation shall be utilized in case civil works must start imme diately. In such cases, the compensation amount of this landowner sh all be deposited in an escrow account and saved at the bank account, which will be ha nded over to the land owner when the court mediates the case and has determined the amount to be paid. Processing Sale-purchase Agreements Ownership right to the land parcel shall be acquired through processing Sales- purchase agreements . The Sales – purchase Agreement must be notarized or ap- proved by the authorized representative of the Public Register. The sales-purchase agreement is signed by the Buyer (RDEMD) a nd an owner-seller. The Agreement shall state the exact amount that the buyer shall pa y to the seller and the terms and conditions for the payment of compensation. Registration of transactio n at the Public Register The RDMED will register the sales – purchase agreement at the Public Register after it is signed by the parties. Notary fees and registration costs will be covered by the RDMED as the buyer of the land. After the regi stration at the Public register, the trans- fer of the ownership rights is considered as accomplished. Throughout the process, the RDMED, as the ag ency to implement the project, will as- sume the overall responsibility to ensure that the land acquisition process will comply with the active Georgian legislation and the World Bank Involuntary Resettlement Pol- icy (OP 4.12). Page 21 Page 21 of 29 9. Public Consultations, partic ipation and Grievance Redress Mecha- nism The staff members of Tbilisi Title Company and Bonifica in association with the Road Department have conducted several meeti ngs with local government bodies, public register and local population. The representatives of Bonifica, Tbilisi Title Company and RD EMD task force had conducted several meetings with the population of the villag es of Agaiani and Okami. They once again introduced to the local population the project goals, land acquisition procedures, explained the landowners and land users their rights. In return they re- ceived the feedback from the users of the la nd parcels that are located within the road construction corridor. The public meetings with the PAP inform ed them about the valuation methodology and the principles of compensation, land acquisition procedures, their rights and re- sponsibilities, alterna tive rehabilitation measures and gr ievance redress mechanism. The main idea of such public meetings is to ensure the fu ll and deep understanding of the entitlements of the RAP implementation procedures. The PAP with complaint or grievance will report to the local Sakrebulo. Based on the submitted complaint the Environmental and Land Acquisition Unit of the RDMED shall directly contact this person and th rough the appropriate measures resolve the raised issue. 9 Page 22 Page 22 of 29 10. Entitlement Matrix Type of loss Loss Implication Catego ry of PAP Entitlement (i) Cash compensation at replacement cost; or HHs losing agri cultural land (ii) If the resources are available the users of the State-owned land shall be offered with replacement land of the same productive value. Permanent loss of land Severe impact Private owners and users with / without titles Re-route the alignment to avoid severe impact Damage to structure Cash compensation at replacement cost that includes the cost of re- construction of the same structure Severe damage of structure Owners of the af- fected structure Re-route the alignmen t to avoid severe impact; if not possible cash compen- sation at replacement costs Loss / damage to structure Damage to roadside commercial struc- ture (e.g. kiosk, gas stand, restaurant) Owners of the af- fected structure Relocation of the structure to near and safe premis e to continue with the same business Owners of the af- fected crops Cash compensation equal to the loss of expected annual harvest due to con- struction Loss of standing crops and trees Owners of the af- fected trees Cash compensation at market value on the basis of type, age, and produc- tive value. Construction Co mpany shall ensure free delivery of logged tim- ber to the owner’s residence and the ow ner shall use logged trees for their own use. For each fruit bearing tree the amount for purchase of a seedling shall be compensated in addition to th e expected loss of income from the sales of fruits. Cash compensation shall not be issued for perennial trees not bearing fruits, but owners are allowed to use the tree s logged down for their own purpose. Loss of in- come/ productive assets Loss of income for roadside business activities Business units Rehabilitation measures including cash compensation at least equal to the income lost due to construction Loss of access to agricultura l land Owners/users Temp orary access will be set up Structures knocked down during con- struction Owners of the af- fected assets Structures will be restored after the completion of construction; or corre- sponding cash compensa tion shall be issued fo r restoration activities Temporary impact Loss of income due to loss of access to business location Owners of the af- fected assets Temporary access will be set up; Constr uction Company shall have to reim- burse temporary loss of inco me (Budget Table, Column 14) if it fails to en- sure access road Page 23 Page 23 of 29 Annexes Annex 1. Data obtained from the department of Statistics of Georgia Page 24 Page 24 of 29 Average annual retail market prices for the years 2000-2005 Tbilisi Name of Product 2000 2001 2002 2003 2004 2005 Average price per 1 kg 1 Nigozi 8,45 8,35 9,28 9,40 10,60 12,20 9,71 2 Green beans 0,62 0,53 0,56 0,60 0,70 1,26 0,71 3 Beans 1,60 1,63 1,55 1,62 0,87 1,87 1,52 4 Tomato 1,39 1,15 1,23 1,61 2,10 2,10 1,60 5 Cucumber 1,15 0,87 1,04 1,34 1,71 1,80 1,32 6 Garlic 0,67 1,01 2,46 2,35 2,13 2,26 1,81 7 Potato 0,46 0,46 0,58 0,59 0,57 0,61 0,55 8 Onion 0,56 0,53 0,53 0,65 0,83 0,70 0,63 9 Wood (cubic meter) - - - - 29,71 31,36 30,54 Georgia Name of Product 2000 2001 2002 2003 2004 2005 Average price per 1 kg 1 Wall nut beans 9,24 9,49 10,12 9,84 10,78 12,65 10,35 2 Green beans 0,88 0,71 0,90 0,67 1,73 1,19 1,01 3 Beans 1,54 1,83 1,83 1,66 1,53 1,75 1,69 4 TomatoP 1,42 1,42 1,44 1,73 2,10 1,98 1,68 5 Cucumber 1,36 1,16 1,12 1,42 1,66 1,63 1,39 6 Garlic 0,73 1,05 2,88 2,56 2,43 2,25 1,98 7 Potato 0,42 0,47 0,57 0,57 0,49 0,54 0,51 8 Onion 0,46 0,48 0,52 0,67 0,82 0,59 0,59 9 Wood (cubic meter) - - - - 29,19 34,19 31,69 Annex 2 Data obtained from the depa rtment of Statistics of Georgia Page 25 Page 25 of 29 Tbilisi Name of product 2001 2002 2003 2004 2005 2006 Average price per 1 kg 1 Apple 0,65 0,77 0, 87 0,82 1,10 1,16 0,90 2 Pear 0,72 0,78 0,91 1,23 1,35 1,70 1,12 3 Plum 0,70 0,87 0,97 1,03 0,87 1,56 1,00 4 Peach 1,38 1,52 1,33 2,56 1,36 2,05 1,70 5 Grapes 0,97 1,50 1,64 1,76 2,46 2,36 1,78 6 Walnut 8,35 9,28 9,40 10,60 12,2 0 12,6 6 10,42 7 Nut - - - 4,52 5,29 4,43 4,75 Georgia Name of product 2001 2002 2003 2004 2005 2006 Average price per 1 kg 1 Apple 0,81 0,78 0, 85 0,75 0,91 1,05 0,86 2 Pear 0,85 0,91 0,99 1,04 1,09 1,28 1,03 3 Plum 0,42 1,15 0,71 1,01 1,01 1,50 0,97 4 Peach 1,39 1,34 1,44 2,27 1,44 2,02 1,65 5 Grapes 1,87 1,81 1,89 2,35 2,46 4,14 2,42 6 Walnut 9,49 10,12 9,84 10,78 12,6 5 11,7 0 10,76 7 Nut - - - 3,91 4,88 4,28 4,36 Page 26 Page 26 of 29 Annex 3. Table reflecting the approxim ate productivity of the perennials According to age and type of a perennial) # Type of a per- ennial Incomplete productivity age Approximate Annual yield (kg) Complete productiv- ity age Approximate Annual yield (kg) 1 Walnut tree 8-10 3-4 22-25 40-45 2 Pear tree 5-6 3-7 15-20 150-160 3 Cherry-tree 4-6 14-18 12-15 60-120 4 Apple tree 3-7 3-5 10-12 80-350 5 Mulberry 5-6 3-4 10-11 15-16 6 Cheery 2-3 2-3 6-7 15-16 7 Peach tree 3-4 3-4 6-7 40-50 8 Tkemali 5 6-7 10-15 40-50 9 Dog-rose bush 4 0,5 12 7-8 10 Blackberry 3 0.2-0.5 7 4-5 11 Quincy 5 3 8-10 30 12 Apricot 4 2-3 10-12 40 13 Ceramic 4 2-3 10-12 40 14 Grapes (“Chi- mera”) 3 0.5 4-5 4-5 15 Grapes (“Pino”) 3 0.5 4-5 2.5-3 Page 27 Page 27 of 29 Annex 4 . Sample format for determination market price through Sales Comparative Approach Comparables for Comparison (land parcels listed for sale) Parameters for compari- son Object of ap- praisal # 1 # 2 # 3 # 4 # 5 # 6 # 7 Price _ 24000 838 10000 15000 5025 35175 8000 Size _ 8000 1500 2500 1500 2200 3000 2500 Price per 1 sq.m. 3.00 GEL 3,00 0,56 4,00 10,00 2,28 11,73 3,20 Designation Agricultural land not culti- vated not culti- vated culti- vated with fruit trees wine yard not culti- vated wine yard, fruit trees arable Ad- dress/village E43-E55 section Kavtisk- hevi Chobalauri Tsero- vani Tsero- vani Dzegvi Misaktsieli Agaian i Location vicinity to: Main Road across the road across road further from road close to road close to road further from road in 250 m form road across the road Residential area 0.5 -1 km 0.5 km 2 km 1km 0,5 km 2,5 km 0,5 km 1km Irrigation channel irrigated close far irrigated irri- gated water supply in yard water channel irri- gated Page 28 Page 28 of 29 Annex 5 Demarcation Act No___ of the Land Parcel located within the Georgia Tbilisi-Senaki-Leselidze Auto Road Agaiani-I goeti E43 – E55 Section Road Construction Project af- fected area Date: ___________________2007 Land Parcel Location: _________________Rayon, Village ______________ We, (Names of: the landowner, village Municipality Rtsmunebuli, representative of Rayon Municipality Gamgeoba, surveyor) Composed the hereby Act on the following: 1. In respect with Georgia, Tbilisi-Senaki-Leselidze Auto Road Agaiani-Igoeti E43 – E55 Section Road Construction Project the survey and de marcation activities have been undertaken to land parcel loca ted on the territory of village ____________ and is under private ownership of ___________________________________________________________________________________ (landowner’s full name and ID number) 2. The location and the boundaries of the stated land parcel are endorsed and confirmed by: Chief land arranger of ____________rayon: ___________________________________________________________________________________ Owner of the land parcel: ___________________________________________________________________________________ Owner(s) of the adjacent land parcel: ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ ___________________________________________________________________________________ Full name: _____________ Representative (Rtsmune buli) of ________ _______ rayon Municipality in village ____ __________ 3. We, hereby endorse the fact of conducting Demarcatio n and survey activities to the stated Land Parcel: Land parcel Owner: ___________________________________________________________________________________ Full name: _____________ Representative (Rtsmu nebuli) of ______ _________ rayon Municipa lity in village Agaiani __________________________________________________________________________________ Land surveyor: __________________________________________________________________________________ Representative of _____________ rayon Municipality Gamgeoba _________________________________________________________________________________ Page 29 Page 29 of 29