The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project
(P145237)
REPORT NO.: RES40336
RESTRUCTURING PAPER
ON A
PROPOSED PROJECT RESTRUCTURING
OF
PREPARATION OF A PROGRAM TOWARDS SUSTAINABLE FLOOD MANAGEMENT IN THE GREATER METRO MANILA AREA
PROJECT
APPROVED ON SEPTEMBER 16, 2014
TO
REPUBLIC OF THE PHILIPPINES
WATER
EAST ASIA AND PACIFIC
Regional Vice President: Victoria Kwakwa
Country Director: Mara K. Warwick
Global Director: Benoit Bosquet
Practice Manager/Manager: Sudipto Sarkar
Task Team Leader(s): Joop Stoutjesdijk
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project
(P145237)
ABBREVIATIONS AND ACRONYMS
CPF Country Partnership Framework
DA Designated Account
DPWH Department of Public Works and Highways
ESIA Environmental and Social Impact Assessment
ICC Investment Coordination Committee
NEDA National Economic and Development Authority
PCN Project Concept Note
PH-PTF Australia – World Bank Philippines Development Trust Fund
PHRD Japan Policy and Human Resources Development
PMRBFMP Pasig-Marikina River Basin Flood Management Project
S&E Social and Environmental
ToR Terms of References
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project
(P145237)
BASIC DATA
Product Information
Project ID Financing Instrument
P145237 Investment Project Financing
Original EA Category Current EA Category
Approval Date Current Closing Date
16-Sep-2014 31-Jan-2020
Organizations
Borrower Responsible Agency
Department of Finance Department of Public Works and Highways
Financing (in USD Million)
FIN_SUMM_PUB_TBL
SUMMARY
Total Project Cost 0
Total Financing 0
Financing Gap 0
DETAILS -NewFin3
Project Development Objective (PDO)
Original PDO
The objective is to prepare priority projects, identified by the flood management master plan, that aim to improve flood
management and resilience in and around Metro Manila.
OPS_TABLE_PDO_CURRENTPDO
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project
(P145237)
Summary Status of Financing
Net
TF Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed
TF-18611 04-Jun-2015 19-Jun-2015 19-Jun-2015 31-Jan-2020 2.73 .52 2.21
Policy Waiver(s)
Does this restructuring trigger the need for any policy waiver(s)?
No
I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING
1. This restructuring proposes a five-month extension of the closing date of the PHRD grant, from January 31, 2020 to
June 30, 2020 and flexibility in the Designated Account ceiling from US$300,000 to an amount based on the six-month
cash disbursement projection of the project. These actions were requested in a letter from the Secretary of Finance,
dated December 4, 2019. This will be the third closing date extension, for a cumulative period of 41 months from the
original closing date. In January 2017, government requested a three-year closing date extension. However, the Bank
approved a one-year closing date extension in January 2017 to give time for the recipient to procure consultants, and
when that was done, a two-year closing date extension was approved in January 2018 to implement the grant.
2. Background of PHRD Grant. In 2014, the Japan Policy and Human Resources Development (PHRD) Technical
Assistance Grants Program, Pillar IV provided US$2.73 million to support the Preparation of a Program Towards
Sustainable Flood Management in the Greater Metro Manila Area (P145237). The PHRD Grant Funding Request was
approved on November 25, 2014 and the Grant Agreement was countersigned by government on June 19, 2015 with
a closing date of January 31, 2017. The PHRD Grant is implemented by the Flood Management Cluster of the
Department of Public Works and Highways (DPWH).
3. The PHRD Grant objective is to prepare priority projects, identified by the flood management master plan (Master
Plan), that aim to improve flood management and resilience in and around Metro Manila. The grant finances the
design of flood protection works in the Upper Marikina River, as well as the necessary social and environmental
studies; development of a flood forecasting and early warning system for the Greater Metro Manila Area; and
development of institutional arrangements for sustainable flood management. These activities are part of
government’s Master Plan approved by government in 2012. Progress with implementation of the PHRD grant has of
late been satisfactory and consulting teams have carried out most tasks in their original terms of references. About
US$2.1 million has been committed, although actual disbursement is currently about US$520,000 and another
US$140,000 is being processed for disbursements.
4. Link to PH-PTF-funded Grant. The PHRD grant is linked to a US$3.2 million grant from the Australia – World Bank
Philippines Development Trust Fund (PH-PTF) for Studies for Sustainable Flood Management (P145391). This grant
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project ()
closed on December 31, 2018, with as main output a feasibility study, detailed design, design drawings, and bidding
document for the proposed Marikina Dam.
5. Flood management infrastructure is needed to temporarily store flood waters so that the remaining water can be
conveyed safely through the city into Laguna de Bay and Manila Bay. The proposed Marikina Dam will be a key
structure, but by itself will not be able to avoid flooding in the city caused by a 100-year rainfall event. The proposed
interventions identified under the PHRD grant, in particular a retention basin, will also be needed.
6. Since the two grants are linked, the Bank agreed, as part of the 2018 restructuring, that the services required under
the PHRD grant for the design of flood protection works in the Upper Marikina River could be contracted through an
amendment of the contract with the technical consulting firm that was designing the Marikina Dam. The rationale was
that the Marikina Dam and the flood protection works in the upstream part of the Marikina River are inter-related
and considered a natural continuation of the works. Much of the hydrological and other data collected by
the consultants, the mathematical modeling, and other design aspects of the dam were to be used for the Upper
Marikina River flood protection works as well. In other words, both designs had to be fully synchronized.
7. Current Status of Implementation of PHRD Grant. Three consulting teams have been recruited under the PHRD Grant,
a technical consulting firm, social and environmental (S&E) consultants, and a consulting firm for flood forecasting and
early warning. As per agreed terms of references (ToR), the technical consulting firm and the S&E consultants focused
on interventions downstream of the Marikina Dam, in particular a retention basin. The consulting firm for the flood
forecasting and early warning focused on Metro Manila’s main river basins that still have inadequate flood forecasting
and early warning facilities, including lack of radio telemetric rain and water level monitoring stations and early
warning systems that are effective in reaching people in a timely manner. The latter is especially important for the
Pasig-Marikina River Basin as the construction of the proposed flood management infrastructure will change the river
flood regime and could have major negative impacts in case of an emergency. The three consulting teams have made
good progress and are expected to deliver their main outputs by the end of January 2020. The outputs would include
the feasibility study and draft design for the retention basin, related safeguards studies, and a plan for flood
forecasting and early warning.
8. Rationale for Closing Date Extension and Action Plan. As indicated, the feasibility study financed by the PHRD grant
focused on a retention basin between the San Mateo Bridge and Montalban Bridge, as also suggested in the Master
Plan. Mathematical modeling showed that the capacity of the retention basin would have to be around 20 million m3
to reduce flood risks associated with a 100-year rainfall event, in conjunction with the proposed Marikina Dam. Land
was identified between the two bridges on the right bank of the river. However, since the land area is restricted to
about 140 ha and the required storage volume is large, deep excavation, substantially below the adjacent river bed,
would be required, as well as the construction of large intake and outlet structures and a high capacity pumping
station. The deep excavation of the retention basin would lead to river seepage and inflow of groundwater from
higher areas. Although complicated, it would be technically feasible to construct such large retention basin, but it
would have high operation and maintenance costs due to the constant need for pumping. It would be technically and
operationally better not to excavate below river bed level, which would mean that the storage volume of the retention
basin would have to be limited to around 12 million m3 and combine that with upstream storage. Several options
have been considered, including heightened of the Marikina Dam or two small additional dams on tributaries of the
Pasig-Marikina River. A pre-Project Concept Note (PCN) meeting was held for the proposed Bank project which will
use the findings of the reports financed through this PHRD grant. In that meeting, that was chaired by the Country
Director and attended by the Regional Director of Sustainable Development, a recommendation was made to focus
on heightening of the proposed Marikina Dam, if feasible, by about 6-7 meters to about 81 meters. This would hold
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project ()
additional water and preclude the need for a deeper retention basin. The task team has now identified that this would
be possible, but an update of the Marikina Dam design would be needed, which would be done under this proposed
additional time.
9. The proposed action plan does not include any new procurement of consultants. Each of the consulting firms with
active contracts will have to carry out additional works related to the heightening of the Marikina Dam that was not
envisaged in their original ToRs. DPWH, consultants, and the task team have already discussed the revisions of the
ToRs and contract costs implications that will be finalized as soon as the decision is made on the proposed
restructuring. The technical consultants will have to add some additional staff related to dam designs. As mentioned,
the technical firm that is now working on the retention basin is the same as the one that designed the original dam,
and the firm will bring back the dam designers that were involved earlier. They will mobilize as soon as decision on
this restructuring is made, while the processing of the addendum to the contract is being one in parallel. The
addendum will include the additional tasks and outputs and contract cost increase to update the important design
aspects of the dam. The first task would be the update of the feasibility study, required by National Economic and
Development Authority (NEDA) (see below), by the end of Q1 of 2020, followed by an update of the dam design by
the end of June 2020. The environmental and social consultants and the flood forecasting consultants have all
required staff in place. They have agreed to start the additional works immediately, while the addendums to the
contracts are being processed. The ToR would have to be amended to update the ESIA and other safeguards
documents for a heightened Marikina Dam. This would also require a contract addendum and additional time until
the end of June 2020 to complete all safeguards documents. The firm working on the flood forecasting and early
warning would be requested to take into account a higher Marikina Dam and the impact in case of an emergency, e.g.
a dam break during an earthquake event. This additional work would require some change to the original ToR and
about three months additional time, i.e. until the end of April 2020. The addendums to the three contracts would be
financed from the uncommitted US$600,000 from the PHRD grant. Based on these discussions and commitments, it
can be concluded that the actions to be taken will allow a quick start with the additional activities.
10. Rationale for Flexible Ceiling of Designated Account. The current ceiling of the Designated Account (DA) is
US$300,000. Considering that many payments remain to be made to consultants and the time-consuming process to
request and receive funds in the DA, an increase in the ceiling to US$700,000 was requested by government to ensure
that all payments can be made in the relatively short remaining grant implementation period plus the four months
grace period. The Bank has recommended that the DA ceiling be made flexible based on the six-month cash
disbursement projection for project activities. There are no outstanding audits.
11. Importance of the PHRD Studies for the Proposed Pasig-Marikina River Basin Flood Management Project. The
Government of the Philippines recently requested Bank support to finance the identified interventions in the basin
through the proposed Pasig-Marikina River Basin Flood Management Project (PMRBFMP; P171897). The proposed
project is included in the Philippines Country Partnership Framework for the period July 2019 to December 2023 (CPF,
Report No. 143605-PH, approved on December 17, 2019), in particular Focus Area #3: Addressing Core Vulnerabilities
by Promoting Peace and Building Resilience and Objective #10: Increased resilience to natural disasters and climate
change. The total project cost estimate is US$700 million for structural measures (large dam and a retention basin;
catchment rehabilitation; sediment management; and early warning systems), non-structural measures (inundation
mapping, emergency response planning), and support to indigenous people living in the project area. The activities
that are being financed under the PHRD grant and the proposed additional works will be key inputs for the preparation
of the PMRBFMP. The estimated investments that will be generated by the PHRD grant, including the heightened
dam, are about US$600 million. A PCN meeting is scheduled for January 29, 2020, after which the Bank team will start
the formal project preparation process. Government’s internal approval process, through NEDA’s Investment
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project ()
Coordination Committee (ICC), has started but for it to be completed, updated feasibility studies will be needed. As
mentioned above, these updates will be the first task after approval of the proposed closing date extension. Based
on discussions with DPWH and NEDA, it is expected that the government approval for the proposed project can be
obtained late Q2 or early Q3 of 2020.
12. Conclusions. The recent change in technical scope to a smaller retention basin and a heightened Marikina Dam will
require additional time by the various teams of consultants and some increase in contract costs, for which about
US$600,000 uncommitted grant funds are available. Implementation and completion of the activities funded by the
PHRD grant are of significant importance as they will facilitate the design of critical flood protection works along the
Pasig-Marikina River. A satisfactory completion of the described activities will be important inputs for the preparation
of the PMRBFMP and will allow an early start of project implementation.
II. DESCRIPTION OF PROPOSED CHANGES
13. This restructuring proposes for the following changes:
(a) Change in Results Framework. The dates of the achievement of the indicators have been adjusted to the new
proposed closing date.
(b) Change in Closing Date. A five-month closing date extension from January 31, 2020 to June 30, 2020 to complete
the activities that will be funded by the PHRD grant.
(c) Change in Disbursement Arrangements and Estimates. The DA ceiling will be made flexible based on the six-
month cash disbursement projection for project activities and disbursement estimates have been updated.
(d) Change in Implementation Schedule. With the proposed Grant closing date extension, the implementation
schedule will be updated accordingly, with all tasks to be completed by the end of June 2020.
(e) Update of ISDS. The original ISDS was prepared outside the Portal and the update of the ISDS was again done
outside the Portal. The Portal doesn’t show that the project is currently a Cat. A and none of the policies shows
as triggered. It will be ensured that the ISDS will be disclosed after RVP decision.
III. SUMMARY OF CHANGES
Changed Not Changed
Results Framework ✔
Loan Closing Date(s) ✔
Disbursements Arrangements ✔
Disbursement Estimates ✔
Implementation Schedule ✔
Implementing Agency ✔
Project's Development Objectives ✔
Components and Cost ✔
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project ()
Cancellations Proposed ✔
Additional Financing Proposed ✔
Reallocation between Disbursement Categories ✔
Change in Overall Risk Rating ✔
Safeguard Policies Triggered ✔
EA category ✔
Legal Covenants ✔
Institutional Arrangements ✔
Financial Management ✔
Procurement ✔
Other Change(s) ✔
IV. DETAILED CHANGE(S)
OPS_DETAILEDCHANGES_RESULTS_TABLE
RESULTS FRAMEWORK
Project Development Objective Indicators
PDO_IND_TABLE
Proposals for Upper Marikina River structural measures fully designed that are technically, economically, socially,
and environmentally sound and that are ready for appraisal.
Unit of Measure: Number
Indicator Type: Custom
Baseline Actual (Current) End Target Action
Value 0.00 0.00 2.00 Revised
Date 22-Dec-2014 31-Dec-2019 30-Jun-2020
Proposals for an integrated flood forecasting and early warning system fully designed and ready for appraisal.
Unit of Measure: Number
Indicator Type: Custom
Baseline Actual (Current) End Target Action
Value 0.00 0.00 1.00 Revised
Date 22-Dec-2014 31-Dec-2019 30-Apr-2020
Proposals for institutional arrangements for sustainable flood management in the Greater Metro Manila Area
acceptable to the Government of the Philippines and key stakeholders and ready for implementa
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project ()
Unit of Measure: Number
Indicator Type: Custom
Baseline Actual (Current) End Target Action
Value 0.00 0.00 1.00 Revised
Date 22-Dec-2014 31-Dec-2019 30-Jun-2020
Intermediate Indicators
IO_IND_TABLE
Feasibility study for the proposed interventions in Upper Marikina River completed.
Unit of Measure: Number
Indicator Type: Custom
Baseline Actual (Current) End Target Action
Value 0.00 1.00 2.00 Revised
Date 22-Dec-2014 31-May-2019 29-Feb-2020
Mid-term report with draft proposals for institutional arrangements for sustainable flood management completed.
Unit of Measure: Number
Indicator Type: Custom
Baseline Actual (Current) End Target Action
Value 0.00 0.00 1.00 Revised
Date 22-Dec-2014 31-Dec-2019 30-Apr-2020
OPS_DETAILEDCHANGES_LOANCLOSING_TABLE
LOAN CLOSING DATE(S)
Original Revised Proposed Proposed Deadline
TF Status Closing Closing(s) Closing for Withdrawal
Applications
31-Jan-2018, 31-Jan-
TF-18611 31-Jan-2017 30-Jun-2020 30-Oct-2020
2020
OPS_DETAILEDCHANGES_DISBURSEMENT_TABLE
DISBURSEMENT ESTIMATES
Change in Disbursement Estimates
Yes
The World Bank
Preparation of a Program Towards Sustainable Flood Management in the Greater Metro Manila Area Project ()
Year Current Proposed
2018 100,000.00 300,000.00
2019 1,000,000.00 0.00
2020 1,630,000.00 2,400,000.00