Page 1 INTEGRATED SAFEGUARDS DATA SHEET CONCEPT STAGE Report No.: AC3553 Date ISDS Prepared/Updated: 08/06/2008 I. BASIC INFORMATION A. Basic Project Data Country: Brazil Project ID: P108654 Project Name: BR Pernambuco Sustainable Water Task Team Leader: Marcos T. Abicalil Estimated Appraisal Date: Estimated Board Date: July 7, 2009 Managing Unit: LCSUW Lending Instrument: Specific Investment Loan Sector: Water supply (40%);Sewerage (40%);General water, sanitation and flood protection sector (20%) Theme: Access to urban services and housing (P);Water resource management (P) IBRD Amount (US$m.): 190.00 IDA Amount (US$m.): 0.00 GEF Amount (US$m.): 0.00 PCF Amount (US$m.): 0.00 Other financing amounts by source: Borrower 127.00 127.00 B. Project Objectives [from section 2 of PCN] The proposed project development objective is to improve water resources management and water supply and wastewater service delivery in the State of Pernambuco. It will also support a move towards a long term, innovative approach to sector wide efficiency and financial improvements. This will be achieved through: (i) improvements to the institutional, regulatory and operational framework of the sector, (ii) improvements in COMPESA’s operational efficiency and improved reliability in water service delivery and (iii) improving access to WSS services to those not yet connected. The expected specific results of the project are: (a) an improved and integrated WRM/WSS policy, (b) reduced water losses in the RMR, (c) increased wastewater collection and treatment in selected municipalities, and (d) tested management models for sustainable WSS delivery in rural areas and small towns. C. Project Description [from section 3 of PCN] The project would be supported by a Sector Investment Loan (SIL). While the institutional and policy objectives will pertain to the state as a whole, Bank-financed investments will be targeted to the geographical area of the RMR and selected municipalities of the Capibaribe river basin. Page 2 The proposed project comprises four components as follows: 1. Water Resources Management – to consolidate and improve water resource management and policy through institutional strengthening and improved planning, regulation and financing instruments and implementation of studies on priority river basins. 2. Water Supply Efficiency – to increase the operational, commercial and economic efficiency of WSS service provision, focusing on physical and non-physical water loss reduction in the RMR, and introduction of results-based disbursements by financing performance outputs rather than inputs (works). 3. Expansion of Water Supply and Sewerage Services – wastewater collection and treatment in selected urban areas of municipalities in the Capibaribe River basin, and increase water supply in the RMR. 4. Rural/Small Towns Water Supply and Sanitation – to develop a state policy, appropriate service models, and financing mechanisms for sustainable rural and small towns WSS, through studies and implementation of demonstration projects. D. Project location (if known) State of Pernambuco, Brazil. Components 1 and 4 will cover the whole state, while Components 2 and 3 will focus on the Recife Metropolitan Region and on the Capibaribe River Basin. E. Borrower’s Institutional Capacity for Safeguard Policies [from PCN] The state has an adequate capacity to implement safeguards policies, as proven by the satisfactory implementing of safeguards policies in other Bank financed projects, such as Prometropole, within SEPLAG/State Secretariat of Planning and Management, and Proagua, within SRH/State Secretariat of Water Resources. Thus, it is expected that the Borrower builds upon any existing instruments to address safeguards policies under this operation and also consider further institutional strengthening, which will be assessed and detailed during project preparation activities. F. Environmental and Social Safeguards Specialists Ms Soraya Simao Melgaco (LCSSD) Ms Clarisse Torrens Borges Dall Acqua (LCSUW) II. SAFEGUARD POLICIES THAT MIGHT APPLY Safeguard Policies Triggered Yes No TBD Environmental Assessment (OP/BP 4.01) X The project is expected to have a very positive environmental impact overall, by (i) consolidating and improving water resources management in the state; (ii) connecting people to sewage collection and treatment systems in the selected municipalities in the Capibaribe River Basin, thereby protecting water sources of supply to Metropolitan and Agreste Regions, (iii) increasing the efficiency of the water supply services in the Metropolitan Region, by reducing water losses. Local construction impacts will be controlled through detailed environmental guidelines that will be incorporated into bidding documents. An Environmental Assessment will be undertaken during the project preparation to identify the potential impacts associated with the types of activities envisioned under this project and which appropriate mitigation measures should be implemented to offset those impacts. That Environmental Assessment will (a) review the institutional and legal context of the water sector in regard to environmental assessment; (b) Page 3 Safeguard Policies Triggered Yes No TBD environmental analysis of water supply and sanitation; and, (c) an environmental assessment of selected investments which will be financed by this Project. Consistent with ongoing practice in Bank-supported operations in Brazil and in the State of Pernambuco, financing of investment will be subject to the environmental and social screening, assessment, monitoring and supervision procedures utilizing a series of frameworks which will be set forth in the Project PAD and made public in Brazil, Pernambuco and in the Bank Infoshop and which will include: (a) environmental and social screening of activities; (b) definition of required environmental work; (c) development of guidelines for good environmental and social practices; (d) implementation of required environmental work; and (e) project monitoring. Natural Habitats (OP/BP 4.04) X Forests (OP/BP 4.36) X Pest Management (OP 4.09) X Physical Cultural Resources (OP/BP 4.11) X Impacts on physical cultural resources from specific investments supported by the proposed project will be identified as part of the EA process and any adverse impacts identified will be addressed through mitigation measures to be included in the EMP. The project will entail construction and excavation to expand and replace infrastructure, therefore the State will include screening for any known cultural property in the project area and incorporate "chance find" procedures in the event that culturally significant resources are discovered. Furthermore Brazil has a well developed Physical Cultural Reources legal and institutional framework, based on the Decree of Law #25 of November 30, 1937, which created IPHAN, the National Institute of Cultural Inheritage, and on other legislation on urban, architectural, cultural, artisitic, archeological and imaterial inheritage. The State of Pernambuco also has institutional and legal framework to protect cultural resources, under the responsibility of FUNDARPE, the State Foundation for Protection of Artistic and Cultural Inheritage, under the State Law # 7970 of September 18, 1979. Indigenous Peoples (OP/BP 4.10) X Involuntary Resettlement (OP/BP 4.12) X A Resettlement Policy Framework will need to be prepared prior to appraisal in order to provide the overall approach and strategy for displaced groups in multiple works. In addition, Resettlement Action Plans (RAPs) should be developed for any investments identified for project financing during project preparation. The basic infrastructure services financed by the project are focused on the improvement of the water system and the expansion and connection of existing households to sewerage networks. These investments are not expected to cause physical displacement of people. However, in the event that activities undertaken in the project lead to a need for resettlement, it should be noted that the GoPE developed a procedure for involuntary resettlement for the Prometropole Project, and is also implementing state component of the federal Proagua Project, which has been deemed satisfactory to the Bank. This framework will apply under the Sustainable Water Project. In the event that a need for involuntary resettlement is identified, the GoPE will follow these principles, entitlements and eligibility criteria, arrangements for monitoring and evaluation, and framework for participation. Eventual resettlement plans will be submitted to the Bank for review and approval prior to the Bank providing the no-objection for the works. Safety of Dams (OP/BP 4.37) X The project will implement the expansion and improvement of the formal water supply Page 4 Safeguard Policies Triggered Yes No TBD distribution networks within the Recife Metropolitan Region. However the proposed system expansions will not need to increase water production from the existing systems, which draw on water from a network of existing dams and which mixes these different sources within the RMR water distribution system. The reservoir dams do not have any major operational or maintenance problems during their respective lifetimes. COMPESA, the State Water Company is responsible for the O&M of the dams. Nonetheless, the environmental assessment checklist will include this issue, and relevant Bank policies would be applied to any investment identified during the preparation which might trigger this policy. Projects on International Waterways (OP/BP 7.50) X Projects in Disputed Areas (OP/BP 7.60) X Environmental Category: A - Full Assessment III. SAFEGUARD PREPARATION PLAN A. Target date for the Quality Enhancement Review (QER), at which time the PAD-stage ISDS would be prepared: 09/30/2008 B. For simple projects that will not require a QER, the target date for preparing the PAD-stage ISDS: N/A C. Time frame for launching and completing the safeguard-related studies that may be needed. The specific studies and their timing 1 should be specified in the PAD-stage ISDS. SAT believes that the project is likely to warrant a category A environmental classification based on the information provided in the PCN Package. SAT therefore request a meeting with the task team before QER, once major specific investments have being identified, in order to reach agreement on the appropriate environmental classification. The specific studies and their timing should be specified in the PAD-stage ISDS. An Environmental Assessment will be undertaken during the project preparation to identify the potential impacts associated with the types of activities envisioned under this project and which appropriate mitigation measures should be implemented to offset those impacts. 1 Reminder: The Bank's Disclosure Policy requires that safeguard-related documents be disclosed before appraisal (i) at the InfoShop and (ii) in-country, at publicly accessible locations and in a form and language that are accessible to potentially affected persons. Page 5 IV. APPROVALS Signed and submitted by: Task Team Leader: Mr Marcos T. Abicalil 05/15/2008 Approved by: Regional Safeguards Coordinator: Mr Reidar Kvam 05/13/2008 Comments: Sector Manager: Mr Guang Zhe Chen 05/14/2008 Comments: