The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) Appraisal Environmental and Social Review Summary Appraisal Stage (ESRS Appraisal Stage) Public Disclosure Date Prepared/Updated: 07/25/2024 | Report No: ESRSA03622 Jan 17, 2025 Page 1 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) I. BASIC INFORMATION A. Basic Operation Data Operation ID Product Operation Acronym Approval Fiscal Year P500469 Investment Project Financing (IPF) BR Pro-Roads ES 2025 Operation Name Brazil Proactive, Safe and Resilient Road Asset Management Program - State of Espirito Santo Project - Phase 2 Country/Region Code Beneficiary country/countries Region Practice Area (Lead) (borrower, recipient) Brazil Brazil LATIN AMERICA AND Transport CARIBBEAN Borrower(s) Implementing Agency(ies) Estimated Appraisal Date Estimated Board Date State of Espírito Departamento Estradas de Rodagem - 26-Jul-2024 21-Feb-2025 Santo DER/ES Estimated Decision Total Project Cost Public Disclosure Review Date 20-Jun-2024 320,000,000.00 Proposed Development Objective Improve access to sustainable, safe, and resilient transport in the State of Espirito Santo. B. Is the operation being prepared in a Situation of Urgent Need of Assistance or Capacity Constraints, as per Bank IPF Policy, para. 12? No C. Summary Description of Proposed Project Activities The State of Espirito Santo is strategically located between the Northeast and the Eastern part of the Union, being one of the smallest states in the area and population of the Union, with a population of over 4 million inhabitants. The state has a diverse economy, including agriculture, oil & gas, rock extraction and manufacturing, and services, making it an important contributor to the Brazilian economy. However, the State is prone to climate disasters regularly, so Investing in preserving its infrastructure, such as roads, bridges, and ports, will help to improve the efficiency and competitiveness of these industries by reducing transportation costs, saving lives, and increasing access to markets. This Jan 17, 2025 Page 2 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) project, Phase 2 of the Brazil Pro-Roads MPA, will focus on improving the road asset management of interurban roads and promoting connectivity by eliminating dangerous road stretches and reducing the number of bottlenecks in the State network, preserving the road infrastructure in a safe and resilient manner, and supporting the logistical and sustainable planning as part of the institutional strengthening. Managing road assets sustainably is important to ensure that transport remains safe and efficient. The state of Espirito Santo has a large network of roads - 3800 km of paved roads in the State Network - for a State the size of Estonia, and maintaining this infrastructure is critical to ensure that people and goods can move in, out, and around the state effectively. The project will have four main components: (i) Proactive maintenance with a long-term (8 to 25 years) CREMA model using performance-based contracts (PBCs) - improving climate resilience and providing better access to schools, markets, and health centers; (ii) Institutional strengthening for road asset management sustainability, road safety, climate resilience and transport decarbonization; (iii) Improvement of selected state transport infrastructure - bypasses to eliminate logistical bottlenecks and improvement of road safety and universal accessibility along the urban areas once the bypasses are built; and (iv) Project Management. Component 1 is the main one, supporting road works and maintenance throughout the State: The first subcomponent will support interurban roads connecting urban and rural communities in Espirito Santo, improving road safety and climate resilience of those roads, and implementing long-term Design-Build-Maintain 10-year contracts for rehabilitating and maintaining three lots of important agro-logistical corridors in the state. The second subcomponent will structure and implement one CREMA-PPP 25-year contract for rehabilitating and maintaining the selected roads in the Southern part of the state in the same format as previous PPP experiences in Bahia. Component 2 is the institutional strengthening with multiple studies and consultancies to support the capacity building of the State in the coming decade Component 3 will implement road bypasses in two municipalities, and designing two additional ones, where there are many challenges in urban areas, related to road congestion, air pollution, and road safety issues; Public Disclosure along with road safety and accessibility improvement activities along urban areas. Component 4 will provide technical support to the Project implementation. The project will promote social inclusion by providing better opportunities for the rural population in Espirito Santo, who often face limited access to education, healthcare, and job opportunities, so will have activities to tackle those issues. Also, Gender activities are envisioned to improve access to job markets in the road sector. Finally, the use of Performance-based contracts will provide the State with an effective way to ensure that maintenance and rehabilitation activities are carried out in a timely and effective manner, while also providing incentives for contractors to meet specific performance targets. These contracts can be linked to road safety performance, as well as to other indicators of quality and resilience, such as pavement condition, drainage, and signage. By linking road safety performance to longer-term maintenance and rehabilitation contracts, Espirito Santo will ensure that its road infrastructure is designed and maintained with safety in mind. This can contribute to a reduction in road accidents and fatalities, which are major public health concerns in the region. And, in addition, longer-term contracts that are structured as PPPs - as it is intended, will provide a range of benefits, including access to private sector expertise and resources, as well as greater flexibility in project design and implementation. This can help to ensure that road infrastructure is built and maintained, while also providing opportunities for private-sector investment and job creation. D. Environmental and Social Overview D.1 Overview of Environmental and Social Project Settings The project is located in the State of Espírito Santo in the Southeast region of Brazil. The State of Espirito Santo is strategically located between the Northeast and the Eastern part of the country, being one of the smallest states in area Jan 17, 2025 Page 3 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) and population (just over 4 million inhabitants). The state has a diverse economy, including agriculture, oil & gas, rock extraction and manufacturing, and services, making it an important contributor to the Brazilian economy. The state lies within the domain of the Atlantic Forest Biome, which has historically undergone significant alteration and conversion due to human activities. While a diverse range of situations is observed across different areas of the state, approximately 10% of the original forest remains preserved in a mosaic of highly fragmented areas. Among these areas are legally protected zones located within the project area, including: the Biological Reserve of Augusto Ruschi (IUCN category Ia); State Municipal Park Domingos Martins (IUCN category II); Sao Lourenço Municipal Natural Park (IUCN Category II); State Park of Mata das Flores (IUCN category II); National Park of Caparaó (IUCN category IIa); Natural Monument of Itabira (IUCN category III), Natural Monument O Frade e a Freira (IUCN category III); Vale do Sol Private Natural Patrimony (RPPN), RPPN Meu Cantinho, RPPN Olho D’Água, RPPN Rancho Chapadão, RPPN Pau a Pique, RPPN Uruçu -Capixaba, RPPN Macaco Barbado, RPPN Palmares (IUCN category IV); APAs Goaiapaba-Açu e Lagoa de Guanandy (IUCN category V). Among the various patterns of relief present in the state of Espírito Santo, there are three that predominates: mountainous domain, occupying just over 30% of the state's surface; Domain of Hills and Low Sierras, which occupies approximately 19% and The tabuleiros formation, that occupies around 16% of Espírito Santo's area. Espírito Santo lies in the Central Tropical Zone, with most of the state classified as having a hot and humid climate. As for rainfall, there are two opposing temperature situations: one dry season with lower temperatures and a drier period, and another with higher temperatures and more rainfall. The three most significant river basins in the state are Rio Doce, Itapemirim, and Rio São Matheus. About two-thirds of the territory of Espírito Santo comprises mountainous areas and slopes formed by the Mantiqueira plateau and massifs in the northwest of the state. Due to its natural geography, these zones are prone to natural disasters caused by Public Disclosure extreme weather events. Changes in land use within watersheds, such as conversion to pastures and crops, exacerbate water-related disasters. This alteration in land use also leads to erosion and sedimentation of riverbeds and reservoirs, further heightening the area's susceptibility to floods, droughts, and dry spells. Therefore, the state is susceptible to natural disasters and extreme weather events and maintaining the state’s large network of roads (3800 km of paved roads) is critical to ensure that people and goods can move in, out, and around the state effectively. Hence, project's interventions are expected to benefit the population that is most vulnerable to extreme weather events and natural disasters, particularly family farmers.These farmers make up the majority of the population in the cities that are slated to receive improvements to the road infrastructure outlined in Component 1 and 3. D.2 Overview of Borrower’s Institutional Capacity for Managing Environmental and Social Risks and Impacts The Department of Buildings and Roads of Espírito Santo (DER-ES) will be responsible for the Implementation of Project activities. DER/ES is in charge of: implementing, regulating and supervising the State Policy on Transport and Public Works; managing the indirect execution of engineering works, transport infrastructure solutions and services of any nature; and managing and regulating the infrastructure of the State Highway System, including its operation, maintenance and conservation, restoration, capacity adjustment, expansion, and construction of new roads and terminals. DER has been responsible for carrying out works on projects financed by the Bank - ES Integrated Sustainable Water Management- P130682 and ES Water Security Management -P176982 with satisfactory results, and demonstrated the Jan 17, 2025 Page 4 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) ability to implement measures to minimize impacts related to physical displacement, and management of socio- environmental risks. The DER already has socio-environmental risk management and resettlement management teams, but will be the first time that the DER will be responsible for implementing a WBG Project`s directly. To enhance the management of E&S risks, PMU and DER teams training sessions specifically on the application of relevant environmental and social standards to the project, and specifically on ESS6 and ESS10, were conducted during the preparation. Additional training sessions are planned throughout the project implementation as: i) Specific aspects of environmental and social assessment and management; ii) Application of the Project's environmental and social risk management tools that will be included in the ESCP.As it has a consistent record of satisfactory performance in the execution of a previously Project, the institutional capacity analysis demonstrated that the DER can maintain this condition of execution performance in the areas covered by the Project. Project Component 4 includes support to the environment and social risk management works, including allocation of permanent environmental and social specialists to the PMU and the carrying out of capacity building workshops on the Environmental and Social Standards that are relevant for the Project. The team hired and maintained by the PMU will be reinforced and will be dedicated especially to the Project, and will be composed of at least (one environmental specialist; one social specialist and one specialist in communication and stakeholder engagement). The PMU will be subordinated to the Project and Action Management Directorate that already has socio-environmental risk management. Finally, the Contractors to be hired to carry out the works will also be responsible for carrying out the environmental measures established in Contractors Environmental and Social Management Plans (C-ESMPs) and shall keep a team of environmental and social specialists. Public Disclosure II. SUMMARY OF ENVIRONMENTAL AND SOCIAL (ES) RISKS AND IMPACTS A. Environmental and Social Risk Classification (ESRC) Substantial A.1 Environmental Risk Rating Substantial The environmental Substantial risk rating accounts primarilly for the construction of two road bypasses and resulting loss of habitats, as well as from the maintanace and rehabilitation works of existing roads within the ROW but inside protected areas. The construction of bypasses carries a substantial environmental risk due to potential impacts on natural habitats. Although these projects don't directly encroach upon legally protected areas, they could lead to habitat loss, fragmentation, edge effects, and wildlife casualties. However, most of these risks are expected to be temporary, predictable, reversible, of moderate magnitude, and site-specific, thus unlikely to result in significant adverse effects on a broad scale. In addition, established mitigation and compensation measures, such as land use controls, wildlife passages, and community involvement, supported by the adoption of GIIP, are in place to address these concerns. Both Brazilian and Espirito Santo State environmental laws address these risks through a comprehensive three-phase licensing process, requiring environmental and social impact assessments, including an evaluation of alternatives. Furthermore, the construction of bypasses will comply with the rigorous standards set forth in Law 11,428/2006, aimed at protecting the Atlantic Forest biome. To ensure alignment with the objectives of the Environmental and Social Framework (ESF), a thorough Biodiversity Preliminary Assessment (BPA) and an extensive Environmental and Social Impact Assessment (ESIA) will be conducted. The CREMA works present a Jan 17, 2025 Page 5 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) substantial risk because some sections intersect legally protected areas (IUCN Class V), although they are situated within the right-of-way and do not cause habitat loss.These risks primarily involve typical issues related to road construction, such as minor air and water pollution, generation and disposal of construction waste, and ensuring worker safety. They are predictable, temporary, site-specific, and have established mitigation measures in place through the application of GIIP. The Risk rating also takes in consideration the local capacity to implement the project and both the DER and the state environmental agency (IEMA) teams, demonstrated to have the technical expertise to effectively manage environmental risks and impacts associated with similar projects. Moderate A.2 Social Risk Rating The social risk classification is moderate. The potential negative impacts would be more linked to Component 1 and 3, that will focus on road improvement and maintenance. Subcomponent 3.1 involves the construction and maintenance of new road bypasses, and Subcomponent 1.1 will support proactive road network management on existing highways,. As the technical design of these bypasses have not been defined yet and will prioritize the alternatives that simultaneously are the most technically and economically viable and the least environmental and socially impactful, it is expected the risks associated with land acquisition, restriction on land uses and involuntary resettlement can be reduced. The construction of the bypasses are expected to increase traffic and road safety within the towns and it is not expected to have significant negative economic impact on local commerce (which will be further assessed as part of the project designs, during project implementation). Other project activities on road maintenance and feeder road restoration are not expected to lead to land acquisition or land use restrictions. Indigenous peoples per ESS7 are not present within the direct areas Project’s interventions. The screening of potential social risks associated witht these Project-supported activities highlighted temporary potential risks that Public Disclosure may be faced mostly during the construction stage and are associated with: a) inadequate behavior (including in matters related with SEA/SH) of the contractors' workforce in both the workplace and in their daily relationships with local dwellers; b) workers’ exposure to working conditions; c) community exposure to health risks; and d) the potential increase of traffic and road safety risks to workers, affected communities and road users caused by the use of heavy machinery. The works are likely to be implemented by local firms and local labor, with low likelihood of labor influx. There is also a potential for excluding vulnerable groups from benefits offered by the project. To address these risks, the project carried out mapping of relevant stakeholders, including government entities and NGOs, to support the engagement process and a robust GRM system will be implemented. The assessment also highlights some benefits expected from the Project such as the improved access to basic public services (schools and health facilities) and outflow of agricultural production from poor and vulnerable rural communities with all-season access feeder roads, the boosting of the local economy, the development of the regional economy in the important nearby tourism spots, and the increase in municipal tax revenues. DER it has shown strong commitment for stakeholder engagement. During the preparation of the Project, consultations were carried out with priority focus groups, especially in the locations that will receive the works of Component 3. Among vulnerable groups, it was identified has traditional communities of immigrants of Italian, German and Pomeranian origin, who preserve their own language and cultural traditions. During the consultations held in preparation phase, it was suggested that the project support the improvement of tourism signage on roads that indicate the presence of traditional communities, as well as safety conditions for vulnerable groups such as children, the elderly and people with disabilities. Thus, in addition to the actions planned to mitigate risks, as such as specific road safety studies and the adoption of a traffic management plan to minimize possible impacts on road users and communities located in the surrounding areas; the Component 2 Jan 17, 2025 Page 6 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) of the project now includes actions to improve the institutional strengthening for sustainability of road asset management, road safety, climate resilience, and inclusion. B. Environment and Social Standards (ESS) that Apply to the Activities Being Considered B.1 Relevance of Environmental and Social Standards ESS1 - Assessment and Management of Environmental and Social Risks and Impacts Relevant The Borrower has developed a stand-alone Environmental and Social Management Framework (ESMF) to evaluate the potential risks and impacts associated with the CREMA works under Component 1 and technical assistance activities under Component 2, whilst road bypass construction risks and impacts, under Component 3, will assessed and managed under project specific ESIAs. As per state legislation (IEMA Normative Instruction No. 13/2021), CREMA works are typically classified as low risk and exempted from licensing requirements whenever they meet specific criteria, such as not requiring land clearings of flora and when works are limited to existing rights-of-way. However, despite this exemption, these works are still required to prepare and implement Contractors’ Environmental and Social Management Plans (C-ESMPs). The draft ESMF identifies the overarching impacts of these activities and outlines the process, studies, and programs necessary to assess, manage, mitigate, or compensate for their environmental and social impacts. Prior to Appraisal, the draft ESMF will be disclosed for consultation. The final ESMF will incorporate eligibility and exclusion criteria for subprojects, Environmental and Social Technical Specifications for the design and construction of road rehabilitation works, and requirements for the contractor's ESMPs. This final version of the ESMF, revised to reflect the outcomes of the consultation process, will be adopted and disclosed within Public Disclosure 30 days of Project Effectiveness. Contractor's ESMPs are required to include institutional, mitigation, and monitoring measures to be implemented during construction, with the aim of eliminating, neutralizing, or reducing identified socio-environmental risks and impacts to acceptable levels.. Two road bypasses, located in the municipalities of Santa Teresa and Santa Leopoldina under Component 3, are considered substantial risk due to their potential impact on biodiversity and loss or fragmentation of natural habitats within the Atlantic Forest biome. To ensure alignment with the objectives of the Environmental and Social Framework (ESF), a thorough Biodiversity Preliminary Assessment (BPA) and an extensive Environmental and Social Impact Assessment (ESIA) will be conducted. A Technical, Economic, and Environmental Feasibility Study (EVTEA) has been finalized for the Santa Teresa bypass subproject. Regarding the Santa Leopoldina bypass, the feasibility of an alternative route will be completed under the preparation of the ESIA. Brazilian legislation mandates a three-phase environmental licensing procedure, culminating in the completion of a full Environmental Impact Study (EIA/RIMA) for such projects. This assessment will include the identification of natural or critical habitats based on the findings from field surveys, existing literature and the requirements form ESS6. The Biodiversity assessment must also include the recommendations to avoid, mitigate or compensation for the impacts to the loss of habitats and target species. The Environmental and Social Impact Assessment (ESIA) must also encompass an assessment and selection of road alignment design alternatives. This process involves evaluating various design options based on criteria such as cost-effectiveness, road safety, and minimizing environmental and social impacts. Once the alternatives are assessed, the ESIA will integrate the selected design alternative, taking into account its combined benefits in terms of cost efficiency, road safety improvements, and reduced environmental and social impacts. ( following the provisions of the Federal Law No. 11.428/2006) . The Environmental and Social Impact Assessments (ESIAs) will be conducted in response to the request and Terms of Reference provided by IEMA (Local Jan 17, 2025 Page 7 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) Environmental Agency). Any potential gaps with the Environmental and Social Framework (ESF) will be addressed through additional or supplemental studies. The ESIAs will comprehensively identify socio-environmental risks and impacts, taking into account various factors including the structural components and typology of planned interventions, as well as the environmental, social, geographic, and temporal context of the project. Furthermore, they will consider the regulatory, legal, and institutional framework of both the Brazilian State and State Government. Stakeholder involvement and analyses of locational and technological alternatives will also be integral components of the assessments. Moreover, recommendations aimed at addressing regulatory gaps and ensuring adherence to World Bank environmental and social standards will be emphasized within the ESIAs. For the proposed Technical Assistance activities, the requirements set out in paragraphs 14–18 of ESS1 will apply, as relevant and appropriate to the nature of the risks and impacts arising from the TA and the terms of reference, work plans or other documents defining the TA scope and outputs will be drafted so that the advice and other support provided is consistent with ESSs 1–10. ESS10 - Stakeholder Engagement and Information Disclosure Relevant The Borrower has developed Stakeholder Engagement Plan (SEP) and carried out consultations with priority focus groups on directly affected or vulnerable groups, such as organizations representing people with disabilities; union of workers and rural producers, especially in the localities that will receive the works under Subcomponent 3.1. Among the concerns raised were the lack of accessibility of sidewalks and the need to improve traffic for the flow of agricultural products, among others (all demands raised are described in the SEP). Based on these consultations, it was verified that the project's actions will meet the demands and needs of the communities. These consultations carried out early in the preparation of the Project informed the improvement of the Project design and the SEP itself, as recommended in ESS 10. The draft Stakeholder Engagement Plan (SEP), which will be disclosed for broad public Public Disclosure consultation before Appraisal. A final version of the SEP, reflecting stakeholder feedback gathered, will be disclosed by 30 days after Effectiveness. The SEP mapped the key stakeholders, identifying the dwellers and petty merchants located in the communities around the construction work strips, family farmers – including disadvantaged and vulnerable social groups, including women heads of single-parent families, students from rural areas, the elderly and people with reduced mobility,– productive organizations and cooperatives, owners of tourism enterprises and cargo and passenger transport companies, managers of Protected Areas located in the region as the main affected parties. The State Institute for the Environment (INEMA), municipal governments and territorial development state councils, civil society organizations (especially those that work with environmental issues, rural development and vulnerable populations), users of the road network in the Area of Intervention and local population comprise other directly interested parties. The SEP included strategies for three phases: during preparation including a summary of the first consultations carried out with focus groups; and planning for engagement for implementation phase - and works period and engagement in the post reconstruction - maintenance phase. The project will be used to strengthen capacity of the government in the dialogue with the communities in local road network maintenance. The Project’s monitoring and evaluation approach will incorporate the beneficiary assessment of both the construction works carried out and the participatory approach employed to promote stakeholder/citizen engagement. The SEP also describes the features of the Project’s Grievance Mechanism, accessible and responsive to SEA/SH cases. In addition to Project-specific channels, such as website, email and telephone, at the local level, channels will be opened and operated by the Contractors to facilitate the fast resolution of concerns and grievances raised by local dwellers with regards to temporary disturbances caused by the works, or inappropriate conduct of workers, or risks to community health and safety due to inadequate operation of equipment's, etc.A Social Specialist from the Socio-Environmental team hired by the contractor will be responsible for receiving, recording incidents, facilitating the resolution of these Jan 17, 2025 Page 8 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) requests by the contractors and/or forwarding to higher levels the concerns and grievances that cannot be resolved locally. The contractors will be responsible for reporting these occurrences and their resolutions to DER on a weekly basis. DER’s Ombudsman Office will a) oversee the handling of all grievances, ensuring they receive adequate responses in a proper time frame, and b) facilitate the resolution of complaints that are of a more complex nature and cannot be resolved by contractors and/or received through the contact channels made available to citizens by the State General Ombudsman Office, which will also be publicized at all construction sites and communication materials about the Project. DER’s Specialized Ombudsman Office is part of the Specialized Ombudsman Network technically coordinated the Espítiro Santo State General Ombudsman Office. After receiving a complaint, the General Ombudsman's Office forwards the request to the Specialized Ombudsman's Office related to the citizen's request, which has a period of eight working days to send the citizen the first response. The maximum period of response is 60 days, as the period for the first response can be extended twice, for another 22 days and for another 30 days. After registering a complaint, the citizen receives a protocol number and password to track their demand via the internet or by calling the toll-free phone line. The State General Ombudsman Office provides permanently updated statistical data on services provided through the website. The requirements for the operation of ombudsmen are described in the National Legislation No. 13.460/2017 on participation, protection rights of users of public services and regulates ombudsman services. Other relevant Borrower’s ES Framework regarding the implementation of stakeholder engagement, transparency, access to information and personal data protection actions are, inter alia, National Law No. 12.527/2011 on Access to Public Information and Law No. 13.709/2018 on Personal Data Protection. ESS2 - Labor and Working Conditions Relevant This standard is relevant. The proposed project will involve direct workers, and contracted workers. The proposed Public Disclosure project will rely on the Brazilian labor framework (and hence and LMP is not prepared), which includes provisions that enable the achievement of development outcomes that are materially consistent with the objectives of ESS 2 in matters related with working terms and conditions, protection of the workforce and OHS Labor and working conditions in Brazil are mostly regulated at the federal level by various disperse laws and regulations. Of particular relevance to addressing the specific labor and working conditions risks of the project, would be those addressing occupational health and safety (OHS) during construction, including the Consolidation of Labor Laws (CLT) DL n. 5452/43, which consolidates labor laws and includes provisions related to health and accident risks. Moreover, there are regulations known as NRs (Normas Regulamentadoras de Saúde e Segurança Ocupacional do Ministério do Trabalho), which include specific standards for occupational health and safety, such as NR18 for construction works. The NRsare also considered consistent with the requirements of GIIP, ESS2 and the World Bank Environmental, Health, and Safety Guidelines (WB EHSGs).Additionally, other parts of the Borrower Framework of relevance would be as National Law No. 9.029/1995, which prohibits discriminatory practices in admission and employment relationships; National Law No. 12.288/2010, known as the Racial Equality Statute; Law No. 14.611/23, which addresses equal pay; and National Law No. 13.146/2015, also known as the Statute of Persons with Disabilities. Furthermore, Law No. 10.098/2000 establishes general norms and basic criteria for promoting accessibility for people with disabilities or reduced mobility. Lastly, terms and conditions of employment are covered under National Law No 13.467/2017. The aforementioned Borrower Framework is materially consistent with the objectives of ESS2. Any additional requirements to manage these risks, including any associated with instituional capacity and implementation of the Borrower framework, will be set out in the ESCP, including, for example, borrower's commitments to including management of contractors, ESHS monitoring and reporting, and a the establishment of dedicated workers’ GRM. A set of indicators to guide Bank supervision of the management of the risks of the project Jan 17, 2025 Page 9 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) under the Borrower framework will be set out in Project documentation. Given the nature of the works, the Project is expected to engage: (a) Direct workers, including consultants working for the PIU and public officials who will remain subject to the terms and conditions of their existing public sector employment agreements; and, (b) Contracted workers, people employed or engaged through third parties to perform work related to core functions of the project, regardless of location, including contracted workers of the UCP. The project is not expected to engage community workers or primary supplier workers. Some project workers will be exposed to traffic and road safety risks due to the operation of heavy machinery during the construction stage. It is expected that most labor will be supplied locally and no major issues associated with labor influx are anticipated. To ensure the health and safety of workers during project implementation, all construction contractors will be required to complete and implement a C-ESMP, including an OHS Incident Prevention Plan (OHSPP, or PGR in Portuguese). ESS3 - Resource Efficiency and Pollution Prevention and Management Relevant The road construction and rehabilitation works are expected to generate construction wastes, dust and environmental noise emissions, potential soil and ground water contamination from asphalt mills and gravel extraction (quarries). Soil erosion and temporary contamination of surface water bodies, as well as the consumption of water, energy, wood and other natural resources. . Some of these impacts can also temporarilly affect provisioning ecosystem services to downstream communities as indicated in ESS4 below. As mentioned above at ESS1 section, the contractors must complete comprehensive, site-specific management plans to adequately mitigate these impacts in accordance with the ESMF specifications. The ESMF, ESIAs and site-specific Environmental and Social studies must also consider sustainable and efficient use of natural resources during construction and rehabilitation works GHG emissions related to land use change (forest clearings) must be assessed by the respective projects’ (Bypasses) ESIAs Public Disclosure and addressed through site specific mitigation measures. The Project have diverse and small sources of emissions which are not likely to be significant, therefore GHG estimations is not likely to be required. ESS4 - Community Health and Safety Relevant During the implementation of the envisaged civil works, some temporary, site-specific, and reversible adverse impacts, may occur at the community level bringing risks to community health and safety. These risks are related with the increase in noise levels and production of debris; soil movement and consequent air pollution by particulate material; the increase in the circulation of trucks and heavy machinery that can lead to traffic accidents and impair traffic and road safety, and the temporary influx of workers. The Borrower will ensure that structural elements will be designed and constructed by competent professionals and certified or approved by competent authorities or professionals as required by ESS 4 and the Brazilian legislation and technical standards of Ministry of Labor. All civil works will be efficiently signalized and ring-fenced as also required by both ESS 4 and the country’s regulatory framework, ensuring compliance with universal access requirements (National Law No 10.098/2000 on universal accessibility in public spaces, in urban furniture, in the construction and renovation of buildings and in public transport and communication channels).Vehicles and machinery will be operated by professionally trained drivers and operators. To ensure the fleet of vehicles and machinery has proper operating conditions, contractors will be required to conduct periodical technical inspections. ESS5 - Land Acquisition, Restrictions on Land Use and Involuntary Resettlement Relevant Jan 17, 2025 Page 10 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) This standard is relevant. The road maintenance and feeder road rehabilitation works (supported under Subcomponents 1.1) are not expected to lead to any adverse impacts related to land acquisition or involuntary resettlement as works will be carried out in existing alignments. Nevertheless, the new bypasses under of Subcomponent 3.1 will require some land acquisition and possibly lead to physical and economic displacement in rural areas of these municipalities with limited impact on livelihood and assets, temporary loss of income, and others. Given that the studies of technical alternatives for the construction of these bypasses will not be completed during the preparation stage, it is not be possible to measure the full magnitude of such potentially adverse impacts. During Project preparation and to deal with land acquisition and involuntary resettlement aspects, the Borrower has prepared a draft Resettlement Policy Framework (RPF), which will be submitted to the Bank for review and no- objection until Appraisal and, thereafter, it will be publicly disclosed. The final version of the RPF (revised to incorporate the outcome of consultations) will be adopted and disclosed within 30 days of Project’s effectiveness. The Project’s ESCP states that: a) once the project designs of the bypasses are defined and the necessary information on affected peoples and assets becomes available, into specific Resettlement Plans proportionate to potential risks and impacts, will be prepared and implemented; b) no physical and/or economic displacement will occur until these plans have been finalized, approved by the Bank and implemented by the Borrower, including payment of the total compensation at full replacement cost prior to any displacement; and c) the Borrower will not take possession of acquired land and related assets before compensation in accordance with this ESS 5. ESS6 - Biodiversity Conservation and Sustainable Management of Living Natural Relevant Resources The construction of the two new road bypasses is anticipated to lead to habitat losses within fragments of the Mata Public Disclosure Atlântica biome. It is important to note that, even though the project activities are located in the Atlantic Forest biome, for a habitat to be considered critical, all the requirements set out in the ESS6 must be met to evaluate their sensitivity and value. To address this, a Biodiversity Preliminary Assessment (BPA) is scheduled for all fragments within the direct influence area of the bypass constructions. These BPAs will involve habitat identification, assessment of biodiversity impacts, and the implementation of appropriate mitigation or offset measures. Under the Project and as stated in the Project’s ESCP, DER is required to complete site-specific Environmental and Social Impact Assessments (ESIAs) for the bypasses, including the above mentioned Biodiversity Preliminary Assessments (BPA) If critical habitats are identified, a list of their enabling species will be identified and in-depth biodiversity assessments (based on statistically sound field campaigns and verification of the presence of Critical Habitat-enabling species) will be carried out to assess if the population of these species meets the Bank's guidelines for Critical Habitat determination, and long-term fauna monitoring field campaigns will be conducted during project implementation as part of the site-specific ESMPs. If negative impacts on critical habitats are identified after exhausting all other alternatives, the Biodiversity Assessment will recommend compensatory measures such as biodiversity set-asides for the conservation of Critical Habitats’ species. The Biodiversity Assessments will also determine if the construction of road bypasses is likely to negatively affect Natural/Critical Habitats, leading to habitat loss and fragmentation within the Atlantic Forest Biome, as well as increased car collisions with native fauna species. Finally, they will make recommendations following a hierarchy of mitigation, including: alternative analysis that favor interventions in modified habitats and avoidi them in Natural or Critical Habitats, limiting and phasing land clearings, promoting fauna and flora rescue, building fauna passages, installing speed humps and bumps, and restricting access of local roads to the bypasses. These measures also aim to minimize urban sprawl towards the road bypasses and consequent induced habitat loss. Finally, DER will be required to submit site-specific Vegetation Suppression Plans, detailed Jan 17, 2025 Page 11 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) phytosociological assessments of the Atlantic Forest fragments or other biomes, fauna identification and inventory, fauna rescue plans, wildlife crossings projects, and biodiversity conservation plans for approval by the environmental agency. Specifically for the Santa Teresa bypass a Technical, Economic, and Environmental Feasibility Study EVTEA has been completed considering six route alternatives. The chosen alternative was considered with the least impacts because it is situated in an area with the highest degree of urbanization, land clearings will be mostly on Modified Habitats (70%), largely borders urban areas and it is distant from important protected areas (REBIO Augusto Ruschi and RPPNs of the Santa Teresa municipality). Nevertheless, the rout is in the proximity of a Municipal Park (3.0 km buffer zone from São Lourenço Municipal Park) and endangerd species has been identified in the area. Having that said, more in depth Biodiversity Studies will be completed under the ESIA to acertain if there will be impacts to Critical habitats or CH enabling species. It is anticipated that road rehabilitation (CREMA) subprojects under component 1 may be located within existing protected areas. Nevertheless, it is not expected that CREMA works will result in habitat loss or significant additional impacts to local biodiversity, since all works will be following existing alignments and withing road's ROW. To meet the requirements from ESS6, DER will conduct consultations with IEMA, ICMBio (Federal Protected Areas Agency) and managing Board from the Protected Areas (as appropriate) to ensure that any activities undertaken are consistent with the area’s legal protection status and management objectives. Additional measures to mitigate potential impacts road rehabilitation works will be designed and agreed in consultation with PA managing authority. Regarding invasive species, it's noteworthy that the project's strategies for rehabilitating degraded areas will prioritize the use of native species. This approach involves leveraging local organic soils stored at the outset of operations, which harbor a repository of native seeds, as outlined in the ESMF. ESS7 - Indigenous Peoples/Sub-Saharan African Historically Underserved Traditional Not Currently Relevant Local Communities Public Disclosure This standard is not relevant. There are no indigenous peoples in the project area. The only municipality in the state of ES with the presence of indigenous peoples is Aracruz, located at least 100km away from the project's area. ESS8 - Cultural Heritage Relevant This standard is relevant. Negative impacts on physical cultural resources are not expected during project implementation as the Project’s construction works will normally be located within the existing right-of-ways of road sections, with exception of the works for the construction and maintenance of road bypasses. The municipalities that will receive interventions under Subcomponent 3.1 have buildings considered local historic heritage in the possible areas of intervention. Thus, the ESMF will include measures to protect historical heritage, including compliance with local legislation. The ESMF will also include detailed procedure in line with ESS8 and national legislation to screen for risks and impacts on cultural heritage and include chance find procedures, as well as measures for any impact on intangible cultural heritage. The Borrower will include a chance finds procedure to be followed by Contractors in the Environmental and Social Technical Specifications (ESTS). The ESTS will be included in the bidding documents and the chance finds procedure shall be included in the C-ESMPs. It is worth to highlight that Brazil and the State of Espirito Santo have a well-developed legislative and normative framework to handle chance finds procedures (National Law No 3.924/1961 and Normative Instruction IPHAN 01/2015), which is under the oversight of the National Institute for Protection of Historical and Archeological Sites (IPHAN). ESS9 - Financial Intermediaries Not Currently Relevant Jan 17, 2025 Page 12 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) This standard is not currently relevant. B.2 Legal Operational Policies that Apply OP 7.50 Operations on International Waterways No OP 7.60 Operations in Disputed Areas No B.3 Other Salient Features Use of Borrower Framework In Part The client will need to comply with all national and state regulatory framework, especially with regard to environmental aspects. The due diligence carried out by the project ES team indicated alignment of ESS2 objectives, especially in the national regulatory framework, and as such the project will rely on such framework as indicated above on ESS2. The bypass construction works will also comply with both Brazilian legislation and the bank's requirements, as the national legislation does not classify habitats as required by ESS6. Therefore, although the three-phase licensing process may achieve outcomes materially consistent with the requirements of an ESIA according to ESS1, a preliminary biodiversity survey will be conducted to meet habitat classification requirements as per the ESS6. Additionally, the project will develop an ESMF to address ESF requirements not covered by the state legislation applicable to the Project's typology. Public Disclosure Use of Common Approach No There are no financing partners engaged in this operation C. Overview of Required Environmental and Social Risk Management Activities C.1 What Borrower environmental and social analyses, instruments, plans and/or frameworks are planned or required by implementation? During Project preparation (prior to Appraisal)the Borrower will prepare and consult on: • A draft Environmental and Social Management Framework; • A draft Stakeholder Engagement Plan; and • A draft Resettlement Policy Framework; • The Borrower will also propose and agree with the Bank on the Environmental and Social Commitment Plan. Possible issues to be addressed in the Borrower's Environmental and Social Commitment Plan (ESCP): Jan 17, 2025 Page 13 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) • The establishment of a Project Management Unit (PMU), including the designation of an E&S risk management team comprised, at minimum, of: 1 (one) environmental specialist, 1 (one) social development specialist, and 1 (one) communication and stakeholder engagement specialist. The PMU will be established within the Effectiveness Deadline and the staff will be appointed within 30 days after the Effective Date as set out in the Loan Agreement and thereafter maintain the PMU throughout Project implementation. • Disclosure of the final SEP, ESMF and RPF – incorporating the outcomes from the public consultations carried out before Appraisal – within 30 days of Project’s effectiveness; • Timeline and institutional arrangements for the preparation, the consultation and the disclosure of other and more specific environmental and social risk management instruments (ESMPs/Specific EISAs for each bypass road works and RAPs); • Environmental and social risks monitoring and reporting arrangements. • Institutional capacity building trainings needed to enhance the environmental and social risk management systems III. CONTACT POINT World Bank Task Team Leader: Carlos Bellas Lamas Title: Senior Transport Specialist Public Disclosure Email: cbellas@worldbank.org TTL Contact: Eric R. Lancelot Job Title: Lead Transport Specialist Email: elancelot@worldbank.org IV. FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects V. APPROVAL Task Team Leader(s): Carlos Bellas Lamas, Eric R. Lancelot ADM Environmental Specialist: Maria Ines Miranda Ramos Jan 17, 2025 Page 14 of 15 The World Bank Brazil Proactive, Safe And Resilient Road Asset Management Program - State Of Espirito Santo Project - Phase 2 (P500469) V. APPROVAL ADM Social Specialist: Juliana Medeiros Paiva Public Disclosure Jan 17, 2025 Page 15 of 15