INTEGRATED MANAGEMENT OF LAND BASED ACTIVITIES IN THE SÃO FRANCISCO RIVER BASIN PROJECT GEF/ANA/OAS/UNEP

Activity 3.1 – Evaluation of the Implementation of Instruments of the Water Resources National Policy for the Pilot Basin of the Maranhão River

Executive Summary of the Final Report

FEASIBILITY STUDY OF THE CREATION OF A WATER AGENCY IN THE MARANHÃO RIVER SUB-BASIN

Belo Horizonte-MG INTEGRATED MANAGEMENT OF LAND BASED ACTIVITIES IN THE SÃO FRANCISCO RIVER BASIN PROJECT GEF/ANA/OAS/UNEP

Activity 3.1 – Evaluation of the Implementation of Instruments of the Water Resources National Policy for the Pilot Basin of the Maranhão River

Executive Summary of the Final Report

FEASIBILITY STUDY OF THE CREATION OF A WATER AGENCY IN THE MARANHÃO RIVER SUB-BASIN

Coordinator Elisa de Castro Bruzzi Boechat IGAM – Instituto Mineiro de Gestão das Águas

Consultant Carlos Eduardo Orsini Nunes de Lima

Contract CPR/OEA no PO 35011

February 2003

FEASIBILITY STUDY OF THE CREATION OF A WATER AGENCY IN THE MARANHÃO RIVER SUB-BASIN

EXECUTIVE SUMMARY

INTRODUCTION Activity 3.1, “Evaluation of Water Resources National Policy Instruments Implementation for the Maranhão River Pilot Basin”, is part of the Component of Organizational Structure Development, of the GEF São Francisco Project and is aimed at improving oinstitutional capacities and personnel involved in the enforcement of new laws, regulations and procedures, to assure the continuity of the water resources management practices in the Basin.

The main objective of Activity 3.1 is to evaluate the implementation of Laws 9,433/97 (which defines the new Water Resources National Policy) and 13,199/99 (Legislation of the State of )in the Pilot Basin of the Maranhão River. With this purpose, it carries out a simulation of the operation of a Water Agency, to emphasize the difficulties and paths to follow, in the implementation of a participative and integrated institutional management system, as proposed by the mentioned laws, viewing the preservation of the water resources and sustainable development.

The Maranhão River, belonging to the River Basin, one of the main tributaries of the São Francisco River, in it super course, is located in the central part of the State of Minas Gerais (see Figure 1). Its drainage basin, with 714.6 km², covers the Municipalities of , do Campo and Ouro Branco, in addition to part of and .

The Region of interest is strongly characterized by relevant mining and siderurgic activities, as well as by an increasing urban expansion in the past decade, due both to its great economic expression in the State and to being in the route connecting two important economic Figure 1. Sub-Basin’s location. poles (Rio de Janeiro and )

i The studies, developed in two stages, were initiated in January of 2000. The first stage consisted of data surveys, elaboration of an environmental diagnosis, advertisement of the Project and social mobilization. The following stage made a review of the legal juridical institutional context and prepared a preliminary scenario for the structure a pilot Water Agency, through a financial and economic simulation with emphasis on the charge for the use of the water.

1. CHARACTERIZATION AND ENVIRONMENTAL SITUATION OF THE MARANHÃO RIVER BASIN

The Maranhão Basin has a population of approximately 175,000 inhabitants (IBGE Census, 2000), with 95% concentrated in the urban seats of the three most important Municipalities. The Regions’s history of settlement and economic structuration is marked by the mining activities started in the 16th Century, in Minas Gerais. It is located in a mountainous region, with highly irregular topography and a mesothermic climate, with moderate temperatures and high pluviometry, concentrated in the Summer months. Mean annual precipitation is around 1,300 mm.

As shown in Figure 2, the Maranhão River is formed by the confluence of two water courses, just upstream from the City of Conselheiro Lafaiete. Those are the Ventura Luiz and the Bananeiras Creeks, both starting in Southern part of the State and running in the North-South direction.

Figure 2. Political division of the Maranhão River Basin.

ii The mean long duration flow in the Maranhão River, downstream from the City of Congonhas, almost in its merging with the Paraopeba River, is 10 m3/s, what results in a mean specific discharge of 15 l/s/km2 (mean water availability). The maximum values for mean specific discharges are in the order of 20 l/s/km2, in Ouro Branco Mountains, and the minimum values are around 10 l/s/km2, near Conselheiro Lafaiete. In terms of monthly averages, the maximum river flows reach the 58 m3/s, while the minimum are around 2.5 m3/s. In absolute values, the maximum was 270 m3/s and the minimum 2.0 m3/s. The discharge corresponding to a 95% permanence is 2.63 m3/s.

Geologically, the basin outstands for containing part of the Iron Quadrilateral of Minas Gerais, in its North-Northeastern portion, where it makes boundaries with the Rio Doce and Rio das Velhas Basins. Its lithology is constituted by rocks of the Minas Supergroup, whose stratigraphy includes formations of the and Piracicaba Groups, that present the most important iron ore reserves and mining activities.

As shown in Figure 3, the campestrian formations, represented by rupestrian and cerrado fields, cover the litholic soils at the mountain crests, composing the typical landscape of the Region, covering 17% of the Basin’s area.

Figure 3. Soil use and occupancy.

iii The native forest formations, characteristic of the transition zone between the cerrado’s phytogeographic domains and the Atlantic Forest, where the Basin is located, corresponding to 20% of its area, are highly fragmented. Those lay predominantly in hillsides with steep declivities and bottom of valleys (areas with a low agricultural and livestock raising utilization). Riparian woods, whenever found, are also greatly fragmented.

Almost 50% of the Basin’s area are occupied by pasture, being insignificant the use for agriculture (less than 0.5% of the area). Except for potatoes, planted in the Eastern part of the Basin, agriculture and livestock raising have an exclusively subsistence character, given the soil and topographic conditions, predominantly cambrian. The indiscriminated use of agrochemicals and fertilizers in the planted areas has been a matter of concern for the downstream population, due to the risks of water contamination by toxic elements. However, the problem has not yet been properly investigated.

Picture 1. Siderurgic industry

In the Maranhão River Basin, a few large industries stand out, in the area of siderurgy and iron alloys, including the production of iron-silica and iron-manganese. The most important of them is AÇOMINAS, with an annual steel production of 2.5 million tons.

Life quality and income indicators in the Basin’s Municipalities ate considered good, in comparison with the State and National averages. As a result of that, society is well organized, with a good number of representative entities of the diverse sectors. Infrastructure, however, still is not satisfactory, mostly in regard to the basic sanitation segment.

iv The main factors impacting water quality in the Basin are related to local mining and industrial activities, to the urban sanitary conditions and to the dense road network in the Region, connecting important regional economic poles. The map in Figure 4 presents the physical distribution of these factors.

Figure 4. Environmental impacts map.

As iron and manganese mining predominate, interferences resulting from these activities on the water resources are basicaly related to earth movement for opening access roads, scraping areas for excavating the pits, building piles of displaced material, processing the iron-ore and disposal of the waste.

This type of mining, particularly in the outdoors, intensifies the local topographical differences and declivities, interfering with the mobility of the terrain, making them vulnerable to impacts of runoff. It magnifies the transport of solid material to the water courses, altering the streambeds and the hydro-dynamic equilibrium, specially in the rainy season. This usually occurs when no impact mitigating measures are taken in the mining áreas, in the abandoned or idle mining camps, or in developments without licensing by the environmental agencies.

v The concentration of the population in urban centers brings direct impacts onto the water resources, either related to urban supply, disposal of domestic or industrial effluents, or to the inadequate garbage disposal, which usually reaches the water courses. This is made evident by the high phosphate, fecal coliforms, nitrates and amoniacal nitrogen contents found in the waters of the Maranhão River, from the Bananeiras Creek, downstream from Conselheiro Lafaiete, to its mouth on the Paraopeba River.

Picture 2. Iron mining: Views of the main excavation (left) and disposal reservoirs (right).

In short, the main course of the Maranhão River is highly degraded, in view of the many anthropic activities developed in its Basin. Water quality is bad. According to assessment by the Environmental Foundation of the States of Minas Gerais (FEAM), in 1998, the mean Water Quality Index was 43.76 (rated as bad), being the second worst in the entire Paraopeba Basin.

Picture 3. Bananeiras Creek, in the surroundings of Conselheiro Lafaiete

vi

Picture 4. Bananeiras Creek in the City of Congonhas

It is worth mentioning the participation of COPASA (Sanitation Company in the State of Minas Gerais), that recently was made responsible for the public water supply and sanitary sewers in Congonhas, thus being responsible for all Municipalities in the Maranhão River Basin. Its investment plan, under implementation, regarding sewer treatment, will assure the treatment, in the medium range, of 100% of the domestic sewers in those three Municipalities.

The water courses in the Paraopeba Basin were classified by he FEAM, according to their predominant uses, through the Normative Deliberations COPAM 14/95 and 10/86, as presented in Figure 5. This legislation establishes norms and standards for water quality and for disposal of effluents in water courses, aiming at setting quality levels to be met and maintained along the time.

2. LEGAL AND INSTITUTIONAL CONTEXT

The National Water Resources Policy, established by Law 9,433/97, represented a new institutional mark in the Country, incorporating globally accepted and practiced water management norms and standards Activity 3.1 emphasized the existing legal and juridical instruments constituting the institutional base basin management matters.

Law 9,433/97 establishes na institutional arrangement for the National Water Resources Management System composed by institutions of the public sector, Basin Committees and Water Agencies. The basin Committees also have in their composition representatives of the public sector, of water users and of the organized civil society. This arrangement introduces a new concept of decentralized and participative water resources management in the Country.

vii

Figure 5. Water Bodies Classification Map for the Maranhão River Basin.

In Minas Gerais, considering the basic legal principles, the State Government decided to improve the existing institutional model, creating , in January of 1997, a new model of autarchy, with a more modern structure, the Water Management Institute of Minas Gerais (IGAM), integrated to the National Water Rsources Management System.

The Paraopeba Basin, where the Maranhão River Basin is inserted, had it Committee formed in May of 1999 and inaugurated in August of 2000, as this Activity was under way. Being a State\river, it is ruled by Law 13,1999/99, which institutes the StateWater Resources Policy and the respective Management System. In this case, the Institutional Agents are\as follows:

• At Federal Level: National Water Resources Council, ANA and the São Francisco River Basin Committee.

• At State Level: State Water Resources Council and IGAM

• At Basin Level: Paraopeba River Basin Committee.

Regarding political movements in favor of water resources in Minas Gerais, besides the already mentioned awareness buiding, involving politicians, it is worth highlighting the manifestations carried out by the State House of Representatives, implementing the “Waters of Minas Program”.

viii Regarding institutional issues, IGAM, as the institution repsonsible for the water resources management in the State, under PROÁGUA’s sponsorship, made progresses in the development of a new organization model, not yet implemented, in order to better adjust to the new concepts in participative management. With respect to the management instruments included in Law 9,433/97, some initiatives were taken, even before sanction, in order to advance in the process of their implementation.

Water Resources Director Plans for State Basins were contracted with funds from the Secretary of Water Resources (SRH/MMA). Among them the Plan for the Basins of Tributaries to the São Francisco in the State of minas Gerais. However, due to problems related to release of funds, from the State Counterparts, Works were halted.

Normative Deliberations for Classification of Water Bodies were approved by the State Environmental Policy (COPAM), after 1991. These classifications were created by FEAM, under the light of the COPAM’s Normative Deliberation nr. 10, which establishes norms and standards for water quality and disposal of effluents in water courses. The Deliberation nr. 14, of 12/28/1995, was referent to the Paraopeba River.

IGAM has been practicing Concession of Water Rights since its creation, in 1997, base don the procedures established in the Administrative Decree 010/98 and subsequent acts. Among other things, these procedures determine that until reference flows are estimated for each watershed, the Q7,10 (minimum flow with a 7-day duration in a 10-year period) will be adopted as the maximum value for water rights concession in any of the considered sections. In this manner, a minimum residual flow of 70% of the Q7,10 will be assured.

As to the State Water Resources Information System, IGAM’s Re-Structuration Project will guarantee its implementation through the Directory of Instrumentation and Control. It is anticipated na integration with the other departments of the Environment State Secretary, forming a single information system.

At last, with respect to the charges for the use of the water, no instruments have been implemented yet in the Basins in the State of Minas Gerais. There are studies and simulations only for the Rio das Velhas and the Paraibuna Basins. In addition to that, there are discussions, still incipient, related to the Basin Committees already created.

3. ADVERTISEMENT AND SOCIAL PARTICIPATION PROGRAM

One of the foundations of the Water Resources Policy is the participation and thw working of all the involved in the water resources issues. The groupal efforts provides the strenght for implementation of the new management instruments. The legitimacy of the actors who will work in the sector is possible only with the participation of all the involved, in the broadest possible way. The identification of the main actors and water users, their demand, conflicts and potentialities is of great importance to this work.

ix

3.1 MAIN SOCIAL ACTORS

By Social Actors, it is meant not only the formal representatives of the Water Resources management System, but also the informal representatives who, even not being members of the Basin Committee, are active in the participative management process, such as class associations, NGO`s and local leaderships.

The local Institutional Agents are represented by the Municipal Governments and their respective CODEMA`s of the five Municipalities in the Basin, with greater participation of Conselheiro Lafaiete, Ouro Branco and Congonhas.

The Users’ Sector is represented by water supply and basic sanitation services companies and by local mining and siderurgy enterprises.

Among the Basin’s Social Organizations, stand out the CIBAPAR (Inter-Municipal Consortium of the Paraopeba River Basin),a collegiate forum with juridical personality and pioneer deliberative power in Minas Gerais. It was created in 1994 and has been acting, since then, as a precursor of the Basin Commitee, serving as space for organization and mobilization of the diverse segments of water users.

3.2 EVENTS

In the search for its objectives, Activity 3.1 proposed and started a promotion and social mobilization program. A series of events was carried out, aiming to reach as much public as possible. From closed meetings for formal representatives of the Basin and of public organizations to courses and public surveys open to all water users and to the community.

During the work, two courses were offered, to explain the new Water Resources policy, mainly with respect to the management instruments, such as the classification of water bodies, the concession and charge of the use of the water: 70 persons participated in these courses.

The Public Enquiries were the crowning events of the social mobilization. They tried to identify the main concerns, demands and conflicts related to water uses and users, as well as potentialities and local leaderships. They were preceded by meetings, involving 82 people, for the capacitation of monitors and environmental agents. The six Enquiries were carried ou in two rounds, in Congonhas, Ouro Branco and Conselheiro Lafaiete, from September through December of 2001, with a participating public of approximately 250 people.

3.3 PUBLIC ENQUIRIES ASSESSMENT

The Prefectures showed little knowledge about the issue, no capacity for social mobilization and lack of articulation for implementing integrated actions viewing the restoration of water resources

x quality. Nevertheless, they were willing to get informed and to play an hegemonic rule in the future management process.

The civil organizations showed great interest in participating in the events. However, they have limitations in presenting themselves as representatives of the Basin, as they have difficulties in converging their specific objectives, which tuens them unarticulated and heterogeneous.

The water users sector, represented mainly by mining, siderurgy supply/sanitation enterprises, has shown itself open to discussions and committed to the environmental preservation objectives. Historically, they have been assiduous participants in the forums, even patronizing them, aiming also at building a better institutional image for themselves. Usually, they keep track of the public sectors’ policies and trends, in order to integrate them into their economic strategies, showing skills to integrate with higher instances of the Government.

In a broad way, representatives of the agricultural and livestock raising segment showed concern with the criteria for water charges, being worried with its enforcement.

The participants in the Public Enquiries emphasized that, in spite of the sfforts made in the Basin, the degradation process is still present, thus requiring the implementation of more effective actions by all sectors. This is critical, specially in isues related to sanitation, spring preservation and greater efficiency of the environmental monitoring agencies, particualrly with respect to disposal of solid residuals.

The Enquiries, carried out during the development of this work, revealed the need of the communites with respect to a greater knowledge of the Basin’s problems. There is a willingness to learn, specially matters related to the “economic value of the water”.

3.4 SOCIAL MOBILIZATION AND ENVIRONMENTAL EDUCATION PROGRAM

Based on the expectations and desires of the Community, identified by the Public Enquiries, a Social mobilization and Environmental Education Program was proposed for the Maranhão River Basin, aiming at the participation of all social sectors in the Basin Committee’s consolidation process and in the particiaptive management of the water resources.

In the three main cities, groups of the civil society already participate in the local agenda related to environmental issues and to the new management model, as well as in the actions promoted by the Activity. This constitutes a minimum base for planning actions for future social mobilizations. It is suggested that all agents take part in the search for articulation, institutional integration, social communication, environmental education and formation of multipliers.

Among the proposed actions, there are:

• Research to produce information on water resources, to build the Basin Committee’s Information System;

xi • Setting up a center for making the information available to the communities;

• Promoting social and cultural multidisciplinary expeditions to the water courses;

• Coordinating courses for the formation of “Social-Environmental Agents”;

• Promoting events related to water resources management, organized by the CBH- Paraopeba, with support from IGAM and from the Prefectures. Itinerant expositions and environmental perception circuits to strategic points in the Basin, where citizens may verify the problems in loco;

• Producing educational material for distribution in schools and environmental related local institutions;

• Encouraging civil society’s voluntary and autonomous initiatives related to environmental education, specially those originated by cultural movements, such as theater groups, cultural groups or class associations.

4. STRUCTURING A PRELIMINARY OPERATIONAL MANAGEMENT SYSTEM

Experiences in the field of water resources are diversified. Many countries have been through changes in the legal and institutional apparatus, in response to environmental restrictions, promoting the adoption of economic instruments. Some characteristics are common to the States and might be considered as references for the management of the water resources. Among them, the planning and the flux of information, cadastration processes, concession of rights and charges for the water use and definition of managers and users, as c-responsible for the management.

Taking advantage of the base provided by Federal Law 9433/97, the defense mechanisms and the concept of paying-polluter are vastly advertised. In addition to the concept of paying-user, the obligation to pay for the use or for the degradation of the water resources is established.

4.1. APPLICATION OF THE DIRECTOR PLAN FOR THE WATER RESOURCES OF THE TRIBUTARY BASINS OF THE SÃO FRANCISCO RIVER TO THE MARANHÃO RIVER BASIN

Among the activities included in the Director Plan for the Water Resources of the Tributary Basins of the São Francisco River in Minas Gerais (yet to be concluded), there is a sketch of a Director Plan for the reclamation and water resources management in the Maranhão River Basin, in a macro scale, containing directions for the following actions:

• Treatment of sewers and urban effluents (domestic and industrial);

• garbage collecting, disposing and recycling;

xii • controlling the production of residuals from agricultural and livestock raising activities;

• environmental education;

• preservation of springs;

• proper soil management;

• controlling water usage through concession of rights of use

• reclamation of degraded areas; and

• support to the operation of the River basin Committees.

All those actions are included in the Plan of Actions proposed in this study, taking into consideratio the already existing projects, those to be implemented soon, by local institutions, and the use of funds obtained with the charges for the use of the water.

4.2 CONSIDERATIONS ABOUT THE IMPLEMENTATION OF WATER AGENCIES

Water resources management problems might be treated with regulations or market instruments. To achieve that it is necessary to implement effective instruments that work closely with the diverse involved interests. They might have a corrective, preventive, proactive or economic character.

Corrective instruments include fiscalization, fines and penalties. The preventive ones include evaluation, licencing, concession of water rights and monitoring. Among the proactive there are the planning, the zoning, the classification, the regulation, research, education and communication. Finally, the economic instruments include the rates of use, economic incentives, charge for the the use, compensations, etc.

The National Water Resources Policy will only be in effect when the Basin Committees are fully operating, through their executive offices, the Water Agencies. By their turn, the creation of a Water Agency depends on its financial feasibility, to be guaranteed by the charge for the water use in its area of influence.

In view of this, the management actions implemented by the Basin Committees should take into account the following:

• Establishment and execution of work routines with the users, to promote their enrollment;

• Constitution of a technical assistance to support the formulation of criteria, norms and technical standards for the definition of tariffs and implementation of the charging.

xiii Water Resources Use Charges Principle

The act of charging converts the water into financial assets. Transforming financial resources into water consists in re-distributing the charged amount. Both transformations must be considered in a transparent participative and negotiated process, by the Basin Committee. Charging must necessarily impose behavioral changes in the society, through the valorization of the natural resource represented by the water. Charging is a mean, not the product. When charging results from the need for practical solutions for existing problems, there is a greater probability of success.

An adequate charging policy must be based on the understanding of the actual water resources’ situation, using as references the basin’s diagnosis and the identified conflicts of use, as well as the need for actions to mitigate existing problems, while preserving water availability and quality.

According to the agenda 21, “in planning, all investments and operacional costs must be taken into account, as well as the opportunity costs reflecting the most valuable alternative use of the water. Charging must not be, necessarily, a burden to all beneficiaries. The charging mechanisms, however, must reflect, as much as possible, the actual cost of the water, when used as an economic good, and the capacity of the communities to pay for it”.

Administrative Aspects of the Water Charges

To allow charging for the water, it is required a managerial support, covering administrative and operational aspects. In a Water Agency’s context, basic management instruments and tools must be available to allow for this cycle to be fulfilled. Water charging’s operational cycle is formed by the following successive steps:

• Divulgation, Persuasion and Negotiation – understanding the divulgation of the charging system, of the Basin’s situation, of the investment plan and of the goals and objective sto be achieved;

• Cadastration of users;

• Metering and charging – based on established criteria, norms and standards;

• Collection - Arrecadação – formalizing the bill of charges, delivery to users and receiving, by the official cashier.

4.3 WATER RESOURCES USES AND USERS IN THE BASIN

The establishment of water charges’ criteria and values requires a social and economic analysis of the universe of water users, their demands and of the potential impacts on the water resources, for each one of the representative economic sectors in the basin.

xiv Based on previous studies, the main users were associated with their respective uses, either in the water intake (classified as paying users) or in the disposal of pollutants (classified as paying polluters). In this manner, the most significant users, whose used amounts exceeded those granted by IGAM, were identified. To make the study as efficient as possible, the following classes of water users were adopted, both for water intake and disposal of effluents: • Domestic: including users located in urban areas (households, commercial, public and industrial classes); • Industrial: constituted by the large isolated industries; • Mining: large isolated developments; • Agriculture and livestock raising: only registered users. Chart 1 and Figures 6 and 7 present in absolute and realtive values, respectively, a summary of the total diverted and return flows in the Basin`s drainage network, by users` sector.

Chart 1. Water uses in the Maranhão River Basin, by economic sector

Diversion Totak Efluents User sector m3/s m3/s Domestic 0.63 0.34 Industrial 2.75 0.73 Mineral 1.05 0.46 Agriculture 0.40 0.00 Livestock raising 0.05 0.00 Total 4.88 1.53

Figure 8 presents a broad view of the main users, with respect to water availability in the water bodies in the Maranhão River Basin, in a unifilar diagram. It also allows the evaluation of the importance of maintaining the quantity and quality of the existing water bodies, as well as in their springs, as a way to assure the proper social and economic sustainability of the Region.

xv

Figure 8 – Hydraulic balance diagrams xvi 4.4 SIMULATION OF A PRELIMINARY CHARGING SYSTEM

Water Use Charges

Determining water charges must begin with the establishment of some conditions to be fulfilled by the values associated to them. The first of those conditions is related to the target amount to be collected: The amount must be compatible with the proposed forms of financing for the investment plan and operation of the management system. The second condition refers to the paying capacity of the diverse users` segments.

For the preliminary simulations presented ahead, an investment framework was built taking into account mainly the development opportunities already in discussion in the Region, especially those considering the treatment of sanitary sewers as mitigating measures for the pollution of water bodies.

For establishing the tariffs, values used for other studies, as well as benchmarks were taken into consideration. The initial proposal in this study did not consider agricultural and livestock raising sectors, as those are not significant activities in the Region, given their almost exclusively subsistence character. The suggested charges for the simulation are presented in Chart 2.

Chart 2. Estimated water charges SECTOR USE Industrial Mining Domestic R$/m³ U$/m³ R$/m³ U$/m³ R$/m³ U$/m³ Intakes 0.020 0.070 0.020 0.070 0.010 0.035

Disposal of effluents 0.030 0.105 0.025 0.087 0.020 0.070

(Exchange rate = U$1 = R$ 3.50)

Income Forecasts

The simulation of the Water Agency`s income considered a water use scenario as shown in Chart 3. Chart 4 contains the estimates of incomes by the proposed charging system (total per type and total per user), using the values in the previous item.

Eventually, other simulation could be run, with changes in the charges or in the users` receiving capacity. However, it is recommended that this be done only after conclusion of registration of the water users in the Basin, by the CBH Paraopeba.

xvii Chart 3. Evolution Scenario of Intakes and Disposal of Effluents – 2003 a 2012

PLANO DECENAL - 2003-2012

CAPTAÇÕES / SETORCapTOT LANÇAMENTOS / SETOR Lanç. 3 3 3 ANO m /s (m3/s) m /s m /s DOM IND MIN AGR PEC TOTAL DOM IND MIN AGR PEC TOTAL 2001 0,56 2,75 1,05 0,40 0,05 4,81 0,45 0,38 0,00 0,00 0,05 0,88 2002 0,57 2,83 1,05 0,40 0,05 4,91 0,46 0,34 0,00 0,00 0,05 0,85 2003 0,59 2,92 1,05 0,41 0,05 5,02 0,47 0,31 0,00 0,00 0,05 0,83 2004 0,60 3,00 1,05 0,41 0,05 5,12 0,24 0,28 0,00 0,00 0,05 0,57 2005 0,62 3,10 1,05 0,42 0,05 5,23 0,20 0,25 0,00 0,00 0,05 0,50 2006 0,63 3,19 1,05 0,42 0,05 5,35 0,15 0,22 0,00 0,00 0,05 0,43 2007 0,65 3,28 1,05 0,42 0,05 5,46 0,10 0,20 0,00 0,00 0,05 0,36 2008 0,67 3,38 1,05 0,43 0,06 5,58 0,05 0,18 0,00 0,00 0,06 0,29 2009 0,68 3,48 1,05 0,43 0,06 5,71 0,00 0,16 0,00 0,00 0,06 0,22 2010 0,70 3,59 1,05 0,44 0,06 5,83 0,00 0,15 0,00 0,00 0,06 0,20 2011 0,72 3,70 1,05 0,44 0,06 5,96 0,00 0,13 0,00 0,00 0,06 0,19 2012 0,73 3,81 1,05 0,45 0,06 6,10 0,00 0,12 0,00 0,00 0,06 0,18 Fonte: Sistema de Informações - Estudos da ECOPLAN / Dados da COPASA-MG

Chart 4. Evolution of Incomes: Intakes (paying users) and Effluents (paying polluter)

CaptaçõesCapTOT Lançamentos LançTOT Cap+Lanç

ANO R$R$ R$ R$ R$ R$

DOM IND MIN TOTAL DOM IND TOTAL TOTAL ACUMULADO

2004 105.511 934.675 326.592 1.366.778 84.409 86.164 170.573 1.537.351 1.537.351

2005 129.779 1.155.258 391.910 1.676.947 83.058 103.397 186.456 1.863.403 3.400.754

2006 155.194 1.388.235 457.229 2.000.658 74.493 116.322 190.815 2.191.473 5.592.227

2007 181.798 1.634.151 522.547 2.338.497 0 125.628 125.628 2.464.124 8.056.351

2008 209.636 1.893.573 587.866 2.691.075 0 131.909 131.909 2.822.984 10.879.335

2009 238.752 2.167.089 653.184 3.059.025 0 135.678 135.678 3.194.703 14.074.038

2010 244.721 2.232.102 653.184 3.130.007 0 137.374 137.374 3.267.381 17.341.419

2011 250.839 2.299.065 653.184 3.203.088 0 137.374 137.374 3.340.462 20.681.880

2012 257.110 2.368.037 653.184 3.278.331 0 123.636 123.636 3.401.967 24.083.847

2013 263.538 2.439.078 653.184 3.355.800 0 111.273 111.273 3.467.072 27.550.920

OBSERVAÇÃO: A capacidade de arrecadação é gradualmente elevada, partindo-se de 50% em 2004 com acréscimo de 10 pontos percentuais a cada ano. A partir de 2007 para a classe de lançamento doméstico, não haverá cobrança, considerando a operação das Estações de Tratamento de Esgotos dos municípios.

xviii Investment and Operational Costs

Regarding the planning for investments, actions (structural and non-structural) and initiatives (planned or under implementation by COPASA) were considered, regarding the water supply and sanitation systems in the three Municipalities in the Region.

Among the structural actions are the treatment and disposal of solid residuals and environmental conservation. Among the non-structural are the relevant activities converging to sanitary and environmental education, training and technical instruction, equipping and installing instruments for monitoring and hydrological control, monitoring networks and control of aquifer recharge, in addition to specific sectorial studies.

Total investments in the preliminary simulation, for a 10-year period, were around R$62 million (US$17.7 million). Of that total, the Agency would participate with R$19 million (US$5.4 million) and the difference would be provided by COPASA, Prefectures and private sector. On the other hand, installation and operational costs of the Water Agency will come from the funds collected with the application of the “paying user” and “paying polluter” concept. Chart 5 presents a summary of the investment plan.

With respect to operational costs of the Maranhão Unit in the Paraopeba River Basin Committee, it is expected an annual cost between R$400,000 and R$700,000 (US$115,000 and 200,000), considering personnel, material and equipment expenses, third party services and other general administrative expenditures.

Then, considering the difficulties in the implementation of water charging, given the introduction of new concepts regarding paying users and paying polluters, the following perspectives of net income, from registered users: 80% in the year 2004, 85% between 2005 and 2006, 90% in 2007, 95% in 2008 and 100% until 2013.

Chart 5. Investment Plan for the Maranhão River Basin (RS$1,000)

Executing Agency

Components Agency COPASA Prefectures Private Total sector

Global Investments 19,300 37,254 2,839.1 2,581 61,974.1

Implantation, Complementation and 25,270 25,270 services for improving collecting network and sewer treatment stations (STS)

Cons. Lafaiete - Implantation STS 14,420 14,420

xix Ouro Branco – implantation of STS 4,300 4,300

Congonhas do Campo – Network and 3,420 3,420 interceptors

Congonhas do Campo – STS 5,130 5,130

Implantation, Complementation and 11,984 11,984 services for improving distribution network and water treatment stations (WTS)

Water supply network 6,560 6,560

Complementing and improving existing 2,624 2,624 network

Losses research and control 500 500

WTS (improvements and expansion) 2,300 2,300

Solid Residues 2,839.1 2,581 5,420

Reclamation of existing and abandoned 1,160 1,160 2,320 garbage deposits

Implanting and adjusting sanitary fills 725 725 1,450

Improving pick up services and acquisition 696 696 1,392 of equipment

Municipal Services technical projects under 258,1 258,1 elaboration

Environmental Conservation 13,500 13,500

Reforestation / Recomposition of riparian 5,500 5,500 woods (Maranhão River)

Degraded areas reclamation and 8,000 8,000 conservation

Non-Structural Actions 5,800 5,800

Sanitary and Environmental Education 2,000 2,000

Technical training and specialization 600 600

Instrumentation and equipment for 800 800 it i d h d l i t l xx monitoring and hydrologic control

Monitoring Networks 1,200 1,200

Specific sectorial studies 1,200 1,200

Evaluation of the Water Agency’s Financial Feasibility

The financial balance, that expresses the simulated Water Agency’s economic feasibility, is shown in Chart 6. According to the expected investments and expenses required for the desired income, a liquid cash-flow of approximately R$1.8 million (US$551.000) is projected, after 10 years of operation.

Chart 6. Financial feasibility of the Maranhão Sub-Basin’s Water Agency (R$)

This perspective might lead to a re-evaluation of the investments, specially those considered less expressive, or needing more complex evaluations. On the other hand, one might work with the initially proposed tariffs, what would, in a way, balance the cash-flow. However, only after evaluating the entire Basin of the Paraopeba a more realistic assessment will be possible.

5. CONCLUSIONS

The covered topics in this study tried to reflect the current scenario of the Maranhão River Basin’s water resources, and to Project their future conditions, under the light of the Law 9,433/97, particularly with regard to the operation of a Water Agency.

xxi The integrated analysis of the quantitative and qualitative aspects of the Basin’s water resources, the social and economic context in which they are inserted, the understanding of their uses and conflicts, as well as their impact on the society, allows conclusions which might contribute to the integrated management of the São Francisco River Basin, viewing the sustainable development.

Activity 2.2.A’s conclusions are presented ahead, in blocks, in accordance with the logical structure adopted in the work.

According to the environmental situation:

• Draining a Region with high pluviosity and relevant recharge zones, located in the divides of the Rio Doce and Rio das Velhas Basins, with the rocky substratum characteristics favor great permeability and significant runoff production, The Maranhão River presents good water availability, even in dry seasons. This makes it a great contributor to the flows in the Paraopeba River.

• The above conditions explain the lack of water use conflicts in the Basin, to date, regarding availability. However, the maintenance of such a favorable situation is linked to the rational use of the resource and to the preservation of its riparian vegetation and springs.

• The region might be considered densely populated, with a concentration in urban areas. The indices of income and life quality are considered good, compared to the State and National averages. Society is somehow organized, with a good number of representative institutions, of the diverse sectors. However, infrastructure is still deficient, specially with respect to basic sanitation.

• The main factors impacting water quality in the Basin are related to the local mining and industrial activities, to the urban sanitation conditions in its Municipalities and to its dense road network, linking important economic poles (Belo Horizonte and Rio de Janeiro).

• The expressive mining activities are associated to the geological formations found in the Iron Quadrilateral of Minas Gerais. Those are the most important income source in the area, as they attract large siderurgic and metallurgic industries to the Region. However, these activities represent a high potential risk to the water resources, causing sedimentation problems, augmentation of the turbidity, of mineral concentration (iron and manganese) and of suspended solids, when the proper environmental control measures are not applied. This usually occurs in areas without licenses by environmental institutions or in abandoned or idle mining camping.

• With exception of the culture of potatoes in the Eastern part of the Basin, agricultural and livestock raising activities are insignificant, having an exclusively subsistence character.

xxii • The Basin’s water quality is compromised, mostly due to the direct disposal of domestic and industrial urban effluents, without treatment, into the streams, in addition to the inadequate deposition of garbage. This is revealed by the high phosphate, fecal coliforms, nitrate and amoniacal nitrogen contents found in the waters of the Maranhão River, from the Bananeiras Creek, downstream from Conselheiro Lafaiete, to its mouth in the Paraopeba River.

• In summary, the main course of the Maranhão River is highly degraded, due to anthropic actions. Its water quality is considered bad, and its mean quality index reached 43.76, in 1998, being the second worse inthe entire basin.

• It is remarkable, however, COPASA’s participation, that took charge of the water supply and sanitation works in Congonhas. It became responsible for the Municipalities of the Municipalities in the Maranhão River Basin. Its investment plan, under implementation, will assure the treatment of 100% of the domestic sewers in those Municipalities.

Regardinfg the participation of social agents

• The mobilization events and meetings occurred during implementation of the work had na important role for the implantation of the CBH Paraopeba. It was evident, starting with the process of divulgation of the management instruments in the Basin and with the initiatives of water users, under development, even though in a slow pace, the validation of the Water Resources Management System. In spite of this, the Committee’s actions still lack effectiveness and representability.

• The non-implementation of management instruments (concession of rights, charging, classification of water bodies and information systems) still troubles the performance of the Committee in the management process. The work carried out by this pilot Activity turned oput to be fundamental for the maturation of the process. There is a direct correlation between participation in meetings and the conviction that the instruments are being well understood by the diverse sectors, specially by social civil organizations.

• The Basin Committee still needs to be understood as an instance of effective power in the water resources management process, allowing the exercise of citizenship and, for this reason, must be straightforward in the search for solution to the identified problems.

• It cannot be Said that social participation in the water management in the Maranhão Basin, either through social organizations or through users, is happening as expected. The vision of the “participative management model” by each of the segments is still fragmented.

• Within the present situation, actors were ranked according to their condition to speak in the “water parliament”. This is related to the lack of resources and knowledge by the local social organizations. Until they accumulate a satisfactory volume of information,

xxiii on the new model and become better articulated in their reinvindications, efforts will be required for environmental education and continuation of the social mobilization.

• Evidently, most of the social organization still do not have those conditions. Overcoming this cycle corresponds to the effective validation and consolidation of the public policies, affecting the life of people, with concrete results.

• The meetings for public consultancy constituted na important mark, as they revealed this reality. They were preceded by a mobilization work, by specially trained agents, contributing to emphasizing these differences in the Municipalities within the Maranhão Basin. They contributed to the validation process of the management instruments, as they revealed problems, produced debates, allowed the political affirmation of groups and promoted a greater participation.

• However, it is worth stating that the limits and challenges here presented do not represent, by themselves, an absolutely particular situation of the Maranhão River Basin. The meetings showed that problems similar to those occurring there also occur in other Basins in the Country, where there are attempts to implement management instruments, according to Law 9,433/97.

Regarding the Legal and Juridical Understanding of the Management Instruments.

• Charging for the use of water is part of the tradition of several countries. It is currently recommended by international organisms and successfully adopted, specially in France and, more recently, in Spain, as a form of promoting its rational use and preserving its quality.

Based on the accumulated information and on evaluation of here presented legal and juridical questions, it might be deduced that changing from a regime of Committees to one of Water Agencies will only be possible after implementation of the management instruments. This will require the development of technical and social instruments (vide Terms of Reference 01, in the Activity’s recommendations), for the elaboration of the Strategic Plan for the Paraopeba River Basin, for an Information Management System and a charging system for the use or polluting the water.

• Considering that Minas Gerais’ Water Resources Management System is based on decentralization and participative management, it is understood that the civil society, as a water user, has a relevant role in the construction of pacts and in the establishment of goals regarding quality and quantity. However, for the proper operation of the System and understanding of the water management issues, it is IGAM’s responsibility the regulation and monitoring of all the pacts within the State, as well as the control of the use, through concession of rights, application of the necessary penalties and mediation of conflicts in water uses.

xxiv • It is also responsibility of IGAM to promote, develop and apply eco-technologies for augmenting water availability in areas with deficit, for re-use of the resource and for mitigating adverse hydrological impacts, such as flooding of urban areas. As Minas Gerais is a great producer of water, the management of the resource assumes a significant and strategic character in . Thus, the Institute, in view of its new institutional re-structuration program, supported by the PROÁGUA/ANA, might become an effective agent in the coordination of the process with the basin Committees.

• After the definition, by the State Constitution, of the tariff for using State waters, it will be responsible for the right and authority to implement an administrative monitoring of the process, as well as the power to grant the rights of use, according to the juridical criteria defined by the Union.

Regarding the Feasibility of the Water Agency

• “Water charges” are one of the most important points of the present study, as it is the main water resources management instrument. However, it cannot be treated as an isolated instrument, capable of solving all management related problems. The conxcession of water rights, environmental licencing and Basin plans, approved by the Committees, are also essential instruments. The promotion of investments in the water resources must also be considered, as a way to improve their quality and availability.

• The necessary information for assessing the economic feasibility of the implementation of a Water Agency (surface and groundwater availability, users’ cadastration, and qualitative and quantitative characterization of water intakes and effluents’ disposal) were not sufficient for an adequate study, as they had been collected for different purposes and in different scales. Still, based in the identification and simulation of the charging of big users in the pilot basin, a preliminary evaluation was possible, providing results which will allow application of the model in a large scale.

• Thus, the here presented study might be complemented in a new stage, to adjust eventual imperfections in the proposed model, avoiding this way augmenting the complexity to a point it may create critical operational difficulties or result in excessive implantation costs.

• It hás been verified that some of the biggest users in the Basin have not received a concession of right or have not been registered in the cadastration. It hás been noticed that:

√ The industrial sector is the biggest water user in the Basin, both in terms of demands (56% of the intakes) and in the disposal of effluents (48% of the total). The AÇOMIONAS Siderurgy, the biggest user in the sector, is responsible for these numbers.

xxv √ The mining sector is the second in line, both in consumption (with a participation of 22%, which is almost twice that of the domestic sector) and in disposal of effluents.

√ The agricultural and livestock raising sectors, being disperse and of little significance, corresponding to only 9.2% of the consumption and without effluents, was not considered in the simulation.

• With regard to the criteria and guidelines for the concession of rights and charging for the water, it was evident that only after agreement with the biggest users, to emphasize the need for protection of the ecosystems and for planning environmental preservation actions, charging could be implemented, to assure funds to be used in the Basin.

• The mining, industrial and domestic urban sectors are extremely representative as big users. The AÇOMINAS, CSN, FERTECO, CVRD, SBE, MRS LOGISTICA and COPASA (responsible for basic sanitation services in the Conselheiro Lafaiete, Ouro Branco and Congonhas) are amog those.

• The sectors with greater tendency for augmenting water consumption in a 10-year period are the industrial (42%) and the domestic (30%), considering the development trends. The agricultural and livestock raising sector is less significant (12%), with increase only in the planted crops. For the mining sector, the projection is null, considering the constant consumption in terms of production planning.

• In terms of effluents disposal, it is expected a drastic drop in the current índices, due to the implantation of the treatment plants included in COPASA`s investment plans, to be initiated in 2004. In the same line, the pollution control measures adopted by the industrial sector, as required by environmental regulations, will contribute to this result.

• In a more optimistical formulation, it is considered the implementation of water charging in 2004, assuming that the basic projects and the institutional instruments for implementation of the Water Agency and users` enquiries will be implemented in 2003. It is also believed that users` enrollment in the charging system will be gradual, reaching totality in an expected 10-year period.

• Definition of water tariff for use in the simulation, specially for the intake (paying user) and in the disposal of effuents (paying polluter), required the research of previous studies. Cases of Water Agencies (Rio das Velhas, Piracicaba and Paraíba do Sul) and evaluation of models from other countries, such as the Tajo (Spain) and Colorado (USA) Agencies, were considered.

• It is expected, for the Water Agency, an initial income of R$1.5 million (US$ 430,000)1, reaching a R$3.5 million (US$1 million), in a 10-year period, considering the 12 greatest

1 Exchange rate: US$1=R$3,50, in February/2003.

xxvi users in the Pilot Basin. The total accumulated income in the first 10 years is estimated in R$28 million (US$8 million).

• In terms of operating costs, it is estimated an annual cost varying from R$400,000 (US$115,000), in the first year of operation, to R$700,000 (US$200,000), after 10 years, considering personnel expenditures, material, equipment, third party contracts and other administrative general expenses. The accumulated total, for the 10 years, would be around R$6.5 million (US$1.8 million).

• Regarding the planning for investments, it is estimated a total of R$62 million ((US$17.7 million), for the 10 years, in projects and reclamation works, improvements and environmental preservation, in addition to non-structural actions, including capacitation and environmental education programs.

• The planning includes investments in the Basin`s basic sanitation, already initiated by COPASA, in an estimated total of R$37 million (US$10.5 million). It includes also investments, in the order of R$5 million (US$1.4 million), in partnerships with Prefectures, for the construction of sanitary fillings, reclamation of garbage deposits and for reclamation of degraded areas, by the private sector.

• In this manner, re-investment of funds collected with water charges will be limited to non-structural actions, such as capacitation and environmental education, equipment for fiscalization and hydrological monitoring and for specific sectorial investigations.

• The simulation proved that with the participation of a representative small group of users is possible to make the Water Agency operational, allowing some important investments in the reclamation and ecological preservation of the Region, with improvement and maintenance of its water bodies.

• However, it is also of fundamental importance, to turn feasible the Agency`s investment program, the establishment of partnership with prefectures and with the local sanitation services companies.

• Likewise, it is necessary to keep the users permanently involved, through transparent participatice initiatives carried out by the Committee, viewing the development of an environmental awareness and responsibility, involving those responsible for the greater intakes or pollution of the water resources.

• Nevertheless, before applying those procedures or implementing the water charges, as an element to allow the implementation of the Water Agency, some important factors must be taken into consideration:

√ Technical and legal pré-requisites: This group includes actions without which it is impossible to start charging (user cadastration and passing of specific laws based

xxvii in charging criteria, as functions of the diverted/consumed discharges and of the polluting loads);

√ Articulation and negotiation with the Union: Even after fulfilling all the pré- requisites above, it is necessary that charging take into consideration the federal and state space domains` characteristics;

√ Sustainability and efficacy: The charging and re-investing process can succeed only with the participation of the society, particularly of the involved users.

• Observing that, the Water Agency will be financially structured to accomplish its functions, directly involved with the CBH Paraopeba, with the most important users, with municipal agents and with the society, becoming, in the future, a “Regional development Agency”.

6. RECOMMENDATIONS

6.1 GENERAL RECOMMENDATIONS

This study’s evaluations and conclusions led to recommnedations focused on the continuity of the implemented work. They need to be validated by State authorities, by the community and, specially, by the CBH Paraopeba. They were made viewing compliance with the sustainability, replicability and social participation principles, in harmony with the GEF São Francisco Project, in the context of the future Integrated Management Program.

Some of the recommendations with local scope view the equipping and strengthening of the water resources management institutions in the Maranhão and in the Paraopeba Basins, such as:

• Inplementation of the IGAM’s institutional re-structuralization Project;

• Investments viewing improvement in the Water resources information System of the Paraopeba River Basin, including users cadastration and water availability;

• Actions aimed at the institutional strengthening of the CBH Paraopeba, including implantation of a physical structure and internalization of concession/charging procedures and routines, in addition to the capacitation of technical and management personnel.

In the regional context, considering the portion of the São Francisco Basin within the State of Minas Gerais, it is recommended the building of a structure of an operational system for water resources management. This could be achieved with the implantation of two Water Agencies, covering the 10 Management Planning Units created by IGAM and consolidated by the CERHMG, as shown in Figure 6:

xxviii • SFMG-A Agency, including the UPRH SF1, SF2, SF3 and SF4

• SFMG-B Agency, including the UPRH SF5, SF6, SF7, SF8, SF9 and SF10

Water Agencies

SF1 = Headwaters of the São Francisco SF2 = Pará River Basin SF3 = Paraopeba River Basin SF4 = Abaeté, Indaiá, Borrachudo Rv. And surroundings of Três Marias Reservoit SF5 = Rio das Velhas Basin SF6 = Jequitaí, Pacuí and Middle São Francisco Rv. Basins SF7 = Paracatu River basin SF8 = River Basin SF9 = Downstream reach of the São Francisco, in MG SF10 = Rio Verde Grande Basin

Figure 6. Proposal of Water Agencies in tributary basins of the São Francisco

Notice that the UPRHs 9 and 10 belong to federal river basins (Carinhanha and Verde Grande, respectively), with geo-physical and economic characteristics of the Brazilian Semi-Arid Region. Therefore, they might deserve a special approach or be excluded from the SFMG-B, in the final modelling of the proposed agencies.

6.2 TERMS OF REFERENCE FOR PRIORITY PROJECTS

Three relevant topics for the continuity of the work inspired the elaboration of projects recommended for the Integrated Management Plan of the GEF São Francisco. Their Terms of Reference (TR) are presented ahead.

xxix Chart 7. Recommended Actions for the São Francisco’s Integrated Management Plan

Action Institutional Estimated Estimated Cost Management Duration (US$)

IGAM / CBH 1 – Program for Implementation of the Paraopeba /CBH 300 days 590,000 Maranhão Unit (predecessor of the SFMG-A) São Francisco.

2 – Hydrological Monitoring of the IGAM / CBH 300 days 470,000 Paraopeba River Basin Paraopeba

3 – Assessment of Groundwater Potential IGAM / CBH 270 days 570,000 of the Paraopeba Basin Paraopeba

TR 01- PROGRAM FOR IMPLEMENTATION OF THE MARANHÃO UNIT (PREDECESSOR OF THE SFMG-A AGENCY)

Considering the undeniable importance of the Maranhão River, as one of the most characteristic water suppliers to the the São Francisco River, in addition to its geo-economic characteristics, it is suggested the hiring of specialized consultants for providing technical institutional support to the CBH Paraopeba. This aims at helping in the organization, structuring and implementing a Water Agency, in compliance with the River Basins Planning and Management in the State of Minas Gerais, under the coordination of IGAM.

The present TR views establishing the base for the pre-operation of the predecessor to the Maranhão River Sub-Basin Water Agency. Additionally, it will prepare the institutional arrangements for implementation of the Integrated Agency of the UPRH 1-4 (IGAM’s divisions), including the Basins of the Paraopeba and of the Pará, besides the headwaters of the São Francisco and surroundings of the Três Marias Reservoir. This will contribute to the future Federal Water Agency of the São Francisco River. Specific activities to be implemented are:

• Implementation of awareness building events, regarding the decentralized participative management process (field trips, seminars and workshops).

• Creation of the Water Resources Information System.

• Consolidation and evaluation of users’ cadastration.

• Institutional project of the Agency.

• Elaboration of practical projects for turning the Agency operational.

• Elaboration of projects for inter-institutional agreements.

xxx • Elaboration of the Agency’s Strategic Plan, base don an updated simulation of incomes and expenses.

• Controlling the Water Agency’s implementation.

TR 02- HYDROLOGIC AND WATER QUALITY MANAGEMENT OF THE PARAOPEBA RIVER BASIN

This Project’s purpose is to contract technical institutional support to the CBH Paraopeba, through IGAM, for organizing, structuring and implementing the hydrologic and water quality management of the Paraopeba River Basin. This support includes evaluation and expansion of the existing hydrologic monitoring network, with the installation of additional fluviometric. pluviometric and water quality stations, in the Basin.

The activities to be executed in parallel with the contacts for the implementation process (field trips, IGAM. ANEEL, ANA, etc.) include the following technical studies:

• Inspection and assessment of the hydrologic and water quality monitoring systems under operation in the Paraopeba Basin.

• Integration with the Hydrologic Information System of the São Francisco river Basin.

• Defining technical specifications and design of the additional hydrologic and water quality assessment stations to be installed.

• Preparing operating manuals for the hydrologic and water quality assessment stations.

• Management of the installation and operation of the new stations, establishing the necessary operational procedures.

• Elaboration of projects for inter-institutional agreements

TR 03- ASSESSMENT OF GROUNDWATER POTENTIAL IN THE PARAOPEBA RIVER BASIN

The indiscriminate exploration of aquifers in Brazil, in view of mining activities, has been causing great social and economic problems, as verified in the headwaters of the Paraopeba, Velhas and Doce Rivers headwaters.

As already mentioned, the area under study is inserted in one of the greatest iron ore reserves in Brazil, the Iron Quadrilateral, besides having strategic importance to the Belo Horizonte

xxxi Metropolitan Region’s water supply. The location of the mineral deposits coincide with geological formations with a great potential for groundwater storage.

Its proposed here the hydrogeological modeling of the Paraopeba Aquifer, as well as of a monitoring network, in real time, for managing the system. A better understanding and the monitoring of the evolution of these resources will contribute to the decision process, specially in the case of critical hydrologic events and accidents that may affect water quality.

For implementation and success of this work, it will be required an ample integration with IGAM, DNPM, CPRM, CEMIG, COPASA and other institutions involved, to search for existing information. The Project aims the following results:

• A Monitoring Network Project, with recommendations of partnerships with other agents in the Basin, viewing its implementation.

• An Aquifer and Surface Water Management Plan, including control actions.

• A methodology for estimating explorable water volumes from the aquifer and river systems in the Basin.

• Instruction Manuals, containing control actions and water resources management procedures, with information on the applications for water rights, discontinuing well operations and revoking licenses for mining and industrial operations, among other.

xxxii