FINAL REPORT CHAPTER 7 WILLINGNESS TO PAY SURVEY RESULT 7.1 General General background of willingness to pay and affordability to pay for the potable water in rural communities is described as follows. (1) Most of communities do not collect any water fee or collect very small amounts of water fee because of natural gravity flow system, (2) Average household incomes in rural communities are lower than urban communities, (3) Some residents are not satisfied with present water supply services. In order to obtain detailed information on the water fees that should be paid by the local residents, the Study shall conducted the survey for willingness to pay and affordability to pay for the potable water. Therefore, the willingness to pay survey of 1,000 informants was carried out. 7.2 Methodology A sample survey was applied taking into consideration the survey period. The willingness to pay survey was conducted with 1,000 informants, which were equivalent to 1.9% of the total household numbers, in 24 rural communities by a local consultant during the period from June to August 2007. The survey team conducted the interview survey for each household using the survey form. It was prepared to be answered by figures, the surveyor carried out each survey smoothly and the interviewees could reply without being distressed deeply. As a result, every surveyor could collect the same level of responses from each interviewee. Largely populated rural communities are advantageous in terms of the field period. The Study selected the 24 large scaled rural communities as the target rural communities. Selection procedures were as follows: (1) Grouping of the rural communities by the areas in each marz It was assumed that rural communities, which were located closely together, had similar water supply situations and their responses would probably be similar to each other. Thus, rural communities were grouped by areas. THE STUDY FOR IMPROVEMENT OF RURAL WATER SUPPLY AND SEWAGE SYSTEMS 7-1 IN THE REPUBLIC OF ARMENIA FINAL REPORT (2) Selection of the large population rural communities in each group It was considered that the largest population rural community in the group represented the area. One or several rural communities in the area were selected as the surveyed rural communities. Area grouping and rural communities selected are shown in Figure 7.2.1. (3) Allocation of the sample numbers in each rural community Total sampling number was 1,000. The sampling number of each marz and rural community was allocated in proportion to the population. Sampling numbers for each rural community is given in Table 7.3.1. 7.3 Survey Results The survey results are summarized in Table 7.3.1. 7.3.1 Socio-economic Conditions The survey asked about average house members, duration of stay in the rural community, major household income sources, and average annual household income amount. Average number of house members is 4.4 persons and this figure ranged from 4.1 to 4.8 persons in each marz. There was not much difference among the four marzes. Major income sources were mostly the same in each of the four marzes. They were livestock, vegetables, and other agricultural products. Besides, between 10 and 20% residents lived on a pension. The survey asked the annual average household income. Monthly income was estimated based on the annual household income data. The average monthly income was AMD 43,000 among the 1,000 informants. A monthly average income distribution is shown in Table 7.3.2. Though the rate of higher income household, who earns more than AMD 50,000 per month shown in Table 6.4.1, is larger than the one of the socio-economic survey results, both survey results indicate that monthly household income of (b) AMD 10,001-30,000 is the modal figure and (c) AMD 30,001-50,000 follows. Financial study for O&M fee shall remind the fact that average monthly household income in the 153 rural communities mainly ranges between AMD 10,000 and 50,000. THE STUDY FOR IMPROVEMENT OF RURAL WATER SUPPLY AND SEWAGE SYSTEMS 7-2 IN THE REPUBLIC OF ARMENIA FINAL REPORT Table 7.3.2 Average Monthly Income Per Household Average monthly Aragatsotn Shirak Gegharkunik Tavush Total % of % of total income per household total in Table (AMD) 4.4.1 (a) <10,000 11 0 78 1 90 9.4 10.5 (b) 10,001-30,000 94 21 192 35 342 35.8 60.1 (c)30,001 – 50,000 79 39 84 26 228 23.9 21.6 (d) 50,001-100,000 58 33 76 15 182 19.1 5.2 (e) >100,001 48 27 35 2 112 11.7 2.6 Effective total by marz 290 120 465 79 954 100.0 100.0 Sample numbers 300 120 500 80 1,000 - - Source: JICA Study Team, 2007 7.3.2 Present Water Supply Conditions and Expected Water Supply Methods The survey asked the drinking water source of each house and evaluation of the drinking water source. Rural communities mainly used house connections and public taps. In Tavush Marz, house connection ratio was remarkably low in comparison with the other Marzes. Approximately 85% of the population used public taps and the remaining 15% used house connections. The survey also asked the preferable water supply source in the future. The people in all marzes replied that they preferred house connections in the future as shown in Table 7.3.3. Table 7.3.3 Present Water Source and Preferable Water Source in the Future Marz House connection Public tap Others Present Future Present Future Present Future Aragatsotn 53 63 35 37 12 0 Shirak 53 77 47 23 1 0 Gegharkunik 47 87 39 13 15 0 Tavush 15 99 85 1 0 0 Average 47 79 43 21 12 0 Source: JICA Study Team, 2007 As for water supply schedules, more than 80% of residents could access water 24 hours a day or regularly. There were no remarkable seasonal differences between summer and winter as shown in Table 7.3.4 Table 7.3.4 Average Regular Water Supply Schedule Marz Summer Winter Aragatsotn 5.9 hrs 5.9 hrs Shirak 12.0 hrs 15.0 hrs Gegharkunik 9.0 hrs 6.9 hrs Tavush 12.7 hrs 12.7 hrs Average 9.9 hrs 10.1 hrs Source: JICA Study Team, 2007 Though access to water was relatively satisfactory in every marz as shown in Table 7.3.5, 30% of the residents replied that water quantity was too little and quality was bad. In particular Aragatsotn Marz was not satisfied with the present water quantity and quality. THE STUDY FOR IMPROVEMENT OF RURAL WATER SUPPLY AND SEWAGE SYSTEMS 7-3 IN THE REPUBLIC OF ARMENIA FINAL REPORT Table 7.3.5 Water Quantity and Water Quality Evaluation Marz Water quantity (%) Water quality (%) Satisfactory Fair Poor Good Fair Bad Aragatsotn 28 30 42 31 22 48 Shirak 35 39 26 69 24 7 Gegharkunik 23 49 28 65 17 18 Tavush 38 44 19 36 28 38 Average 27 42 31 53 20 27 Source: JICA Study Team, 2007 7.3.3 Present Monthly Water Fees and Affordable Water Fees in the Future Present monthly water fees in each rural community surveyed are summarized in Table 7.3.6. Eight (8) out of 24 rural communities collected water fees from the users. All rural communities that collected fees applied a flat rate. Water fee ranges from AMD 100 to 500 per month and there was not much difference among the eight rural communities. The collection ratios vary from 10% to 90%. For example, collection ratio of No. 49 Shevavan in Aragatsotn is 10% for the water fee of AMD 500 per month per household, whereas No.14 Kamo in Shirak Marz has a collection ratio of 90% for the water fee of AMD 250 per month per household. Average collection ratio in the eight communities is 48.5 %, which is consistence with the collection ratio of 40% of AWSC in 2006. The remaining 16 rural communities, which did not collect monthly water fees, collected the repair cost when the water supply system was broken. A range of AMD 100~500 per household was collected in the past when needed, but only from the residents that could afford it. Table 7.3.6 Present Water Fee of the Rural Communities Surveyed Rural community Water fee Pay Not pay Repair Remarks cost AMD/M/HH % % AMD/HH Aragatsotn Marz 0 No.09 Aragats 100-300 82 18 No.14 Byurakan 0 150 3% of interviewees pay No.34 Dzaxkahovit 500 60 40 No.37 Katnaghbyur 0 0 100 100-500 No.38 Karmarashen 0 0 100 100-500 No.43 Melikgyugh 0 0 100 100-500 No.49 Shenavan 500 10 90 AMD 250/M/HH was designed. Shirak No.07 Garnaridg 0 0 100 200-300 No.14 Kamo 250 90 10 No.24 Musaelyan 0 0 100 250-300 No.31 Sarnaghbyur 0 0 100 200-300 Gegharkunik No.01 Akunq 500 0 100 Residents pay voluntarily No.03 Aygut 0 0 100 No.06 Astghadzor 300 62 38 No.09 Geghamavan 0 0 100 No.11 Geghovit 0 0 100 THE STUDY FOR IMPROVEMENT OF RURAL WATER SUPPLY AND SEWAGE SYSTEMS 7-4 IN THE REPUBLIC OF ARMENIA FINAL REPORT Rural community Water fee Pay Not pay Repair Remarks cost AMD/M/HH % % AMD/HH No.14 Drakhtik 0 0 100 No.15 Eranos 0 0 100 No.20 Lusakunq 100 16 84 No.24 Tsovagyugh 200-500 45 55 No.34 Mets Masrik 100 23 88 Tavush No.02 Gandzakar 0 0 100 No.06 Teghut 0 0 100 No.12 Navur 0 0 100 100 95% residents pay irregularly Average 48.5% 51.5% Source: JICA Study Team, 2007 Monthly affordable water fee of each surveyed informant was illustrated in Figure 7.3.1.