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PROJECT INFORMATION DOCUMENT (PID) 
CONCEPT STAGE 
Report No.:  AB5322 
Project Name 
Southern Okrug Local Initiatives Support (LISP) 
Region 
EUROPE AND CENTRAL ASIA 
Sector 
Other social services (100%) 
Project ID 
P120434 
Borrower(s) 
RUSSIAN FEDERATION 
Ministry of Finance of the Russian Federation 
9, Ilyinka street 
Russian Federation 
103097 
Tel: +7-(095)-913-4406 
Fax: +7-(095)-913-4315/4308 
apavlov@dmfo.ru 
Implementing Agency 
 
Ministry of Regional Development 
Sadovaya-Samotechnaya street, bld. 10/23 
Moscow 
Russian Federation 
127994 
Tel: +7-495-694-3555 Fax: +7-495-699-3841 
Anton.Suyr@minregion.ru 
Environment Category 
[
]
A
[
]
B
[X] C   [ ] FI   [ ] TBD (to be determined) 
Date PID Prepared 
December 21, 2009 
Estimated Date of 
Appraisal Authorization 
 
Estimated Date of Board 
Approval 
April 29, 2010 
1.  Key development issues and rationale for Bank involvement 
 
The Bank has gained a strong comparative advantage in Russia through its ongoing and 
completed projects as well as AAA and TA provided to SFO in the last 3 years. The Bank is well 
placed to continue its dialogue the Russian government and provide technical assistance in 
developing regional and local development programs. 
 
Value Added of the Bank:
 
The Bank would add value into program design and implementation 
by bringing in (i) global knowledge in local development and experience in design and 
implementation of similar programs in the ECA region; (ii) good knowledge of the SO situation 
and experience in tailoring similar programs to local conditions (e.g. Stavropol pilot); (iii) ability 
to identify cross-sectoral linkages and bring in cross-sectoral integration; and (iv) knowledge of 
cutting edge monitoring and evaluation tools. This program will also benefit from lessons 
generated through ongoing
 programs in Russia’s portfolio, including Stavropol pilot LISP, 
Regional fiscal TA, JSDF on local governance and civic engagement in rural Russia, and SFO 
public administration TA. 
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2. Proposed objective(s) 
 
The proposed project development objective is to improve capacity of local and regional 
governments to deliver better quality services to citizens; their ability to plan and manage these 
services with increased participation of citizens and communities in targeted municipalities of 
the Southern Federal Okrug; and improve capacity of the regional and federal governments to 
effectively support local development, monitor and evaluate program outcomes and disseminate 
good practice.  
 
3. Preliminary description 
 
The lending instrument is Specific Investment Loan.  The proposed loan in the amount of US$ 
30 million is designed as a technical assistance loan.   
Project components 
Component 1
:
Local Capacity Development 
–
US$ 15 million: aims at strengthening capacities 
of newly established settlement and rayon level municipalities for planning, community 
development, budget management, project implementation, community participation, project and 
program participatory monitoring and evaluation. The loan will finance TA activities for 
preparation of municipal development plans, baseline and feasibility studies, preparation of 
project proposals and technical documentation, and project monitoring and evaluation. Loan will 
also provide for training (i) municipalities and (ii) other local stakeholders. The municipalities 
will be supported in strategic planning, population participation in project selection, budget 
preparation and hearings with participation of citizens, management of municipal assets, 
improved delivery of basic services addressing priority needs of population etc. Training also 
will be provided to build capacities of participating communities, NGOs and other local 
organizations. This component will also finance outreach and communications activities. It will 
support participatory project monitoring and assessment of the quality of the provided services 
with larger involvement of population and local stakeholders. All grants, investments in sub-
projects, under this component will be financed from the federal co-financing included into the 
RF, regional and local budgets. The estimated cost of this component to be financed out of IBRD 
loan would be about US$ 15 million. 
 
Component 2
:
Regional Capacity Development – US$ 7 million:  aims at development of 
capacity of the regional governments for program preparation, implementation, monitoring and 
evaluation. Under this component the project will finance training and technical assistance 
supporting policy and capacity building for participating regional authorities (e.g. Ministry of 
Economy, legislators, expert community of the participating regions). The activities would 
support effective and efficient budget management and administration with involvement of 
regional stakeholders, transparency and accountability at the regional level for regional budget 
allocation and expenditure (e.g. publishing budgets and investments on the websites, putting 
appropriate grievance procedure in place, civil society monitoring etc). Technical assistance will 
be provided for preparation of the regional programs, program methodologies, guidelines and 
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instructions for implementation at the regional level. Each region will develop regional 
operational manual detailing the project selection and approval criteria, implementation and 
monitoring procedure. This component will finance regional information dissemination 
campaign and activities aiming at replication of the program results throughout the region. It was 
agreed that the project will start implementation in 2009 in 4 pilot regions, including Stavropol, 
Astrakhan, Adirea and Kabardino-Balkaria. Beginning 2010 the project will gradually expand to 
all 13 regions of SO. Under this component the TA will be provided to the regions for the 
development of the program targeting methodologies and mechanisms (e.g. “poverty maps” will 
be prepared for richer regions of Krasnodar, Volgograd and Rostov). This component will also 
provide support to regional authorities for program implementation and monitoring. The 
estimated cost of this component to be financed out of IBRD loan would be about US$ 7 million. 
 
Component 3
:
Technical Assistance to the Ministry of Regional Development
 
–
US$ 8 million
:
aims at the development of capacity in targeted departments of the MRD. Departments in charge 
of municipal development and involved in policy development of for local economic and social 
development as well as the department in charge of the Program preparation and implementation 
will be provided TA. A flexible program based on the needs of the departments will be 
developed to support the staff of MRD.  
 
Under this component the loan will finance a TA program to the Ministry of Regional 
Development for (i) research and studies; (ii) program monitoring and evaluation; (iii) 
information dissemination and replication of results; and (iv) program management and 
implementation. This component will finance technical assistance for the development of the 
detail program monitoring system which will help the Government to obtain information on 
progress of municipalities and sub-projects selection, financing (from the federal budget) and 
completion in all participation regions. This would permit to undertake necessary operational and 
management decisions for program fine-tuning and adjustment.  This component will provide for 
the development of an integrated Management Information System (MIS) at central level with 
modules at the regional and local levels, allowing the collection and analysis of the full project 
information. Under this component TA will be provided for development of monitoring and 
evaluation system and research and studies for evaluation of program outcomes. The impact 
evaluation of the Program as a whole, as well as activities aimed at dissemination of the outcome 
information and program replication will be financed under this component. A detail program for 
evaluation of the results and outcomes assessment at the federal and regional will be developed. 
A
mechanism for evaluation of impact of the Program is being developed and tested in Stavropol 
Krai. Estimated cost of this component to be financed out of IBRD loan would be about US$ 8 
million. 
 
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4.  Safeguard policies that might apply 
[
Safeguard Policies Triggered by the Project
 
Yes
 
No
 
Environmental Assessment
(
OP
/
BP
4.01) 
[X]  
[ ] 
Natural Habitats (
OP
/
BP
4.04)
 
[
]
[
]
Pest Management (
OP 4.09
)
[
]
[
]
Physical Cultural Resources (
OP/BP 4.11
)
[
]
[
]
Involuntary Resettlement (
OP
/
BP
4.12)
 
[
]
[
]
Indigenous Peoples (
OP
/
BP
4.10)
 
[
]
[
]
Forests (
OP
/
BP
4.36)
 
[
]
[
]
Safety of Dams (
OP
/
BP
4.37)
 
[
]
[
]
Projects in Disputed Areas (
OP
/
BP
7.60)
*
[
]
[
]
Projects on International Waterways (
OP
/
BP
7.50)
 
[
]
[
]
5. Tentative financing 
Source: ($m.) 
Borrower 0 
International Bank for Reconstruction and Development 
30 
 Total 
30 
 
6. Contact point 
Contact: Peter Ivanov Pojarski 
Title: Senior Operations Officer 
Tel: 5245+258 
Fax:  
Email: ppojarski@worldbank.org 
Location: Sofia, Bulgaria (IBRD)
*
By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties' claims on the 
disputed areas
 
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