Environmental and Social Monitoring Report

Project Number: 48271-001 December 2017

PHI: Mactan International Passenger Terminal

Prepared by GMR Megawide Cebu Airport Corporation for the Asian Development Bank.

The environmental and social monitoring report is a document of the borrower. The views expressed herein do not necessarily represent those of ADB’s Board of Directors, Management, or staff, and may be preliminary in nature. Your attention is directed to the “Terms of Use” section of this website.

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ENVIRONMENTAL & SOCIAL MONITORING REPORT

(JULY - DECEMBER 2017)

1. INTRODUCTION

1.1 Background

1.1.1 Airport operations in Mactan Island started in 1966 with the inauguration of the Mactan Alternate International Airport (MAIA). MAIA was established as the replacement to the Lahug Airport located within due to the physical and safety problems the old airport was facing. MAIA was later expanded to become the Mactan Cebu International Airport (MCIA) under the jurisdictions of the Mactan Cebu International Airport Authority (MCIAA) by virtue of Republic Act 6958 promulgated in 1990. The existing airport consists of a passenger terminal building with six aerobridges (serves both the domestic and international flights), a parking bay (425 x 295 m), a parking ramp, and two (2) aprons: south apron (250 x 100 m) and north east apron (220 x 95m), a single runway, and General Aviation.

1.1.2 The Government of the through the Department of Transport and Communication (DOTC) in conjunction with Mactan Cebu International Airport Authority (MCIAA) has awarded the Project titled “Mactan Cebu International Airport Project” to a consortium comprising of GMR Infrastructure Limited and Megawide Construction Corporation, by way of Public Private Partneship (PPP) model on 22 April 2014. To this effect, a 25 year Concession Agreement (CA) has been granted to GMR Megawide Cebu Airport Corporation (GMCAC) a company incorporated by the consortium and registered within the Philippines.

1.1.3 The operations and maintenance of the airport terminal shall be turned over by the Mactan-Cebu International Airport Authority (MCIAA) to GMCAC, beginning in November 2014 while MCIAA continues to have responsibility of airside operations.

1.1.4 The development works are planned to be executed in two phases: Phase 1 is for all the works to be developed for the requirements based on the forecasted demand up to the design year 2024. Phase 2 is for all the works to be further developed for the requirements based on the forecasted demand up to the design year 2039.

1.1.5 The new terminal and other facilities will be built within the project boundary given to GMCAC by MCIAA. As of today, encroachments or claims by private individuals on these lands are not found. Also as of now no outstanding issues or claims on land on which existing facilities to be renovated are located exist. There are no other project facilities which will require any further land acquisition, land purchase or ROW acquisition or clearance. The first parcel of land (previously occupied by the Philippine Airforce/PAF) was handed over by the grantors to GMCAC on June 1, 2015 with the remaining parcels being handed over on December 31, 2015. PAF facility replication, per concession agreement, will be under the responsibility of MCIAA/grantor which was properly done and enabled the land handover process.

1.2 Objective

1.2.1 The objective of the Environmental and Social Performance Report (ESPR) is to report on implementation of the agreed Environmental Management Plan (EMP), Environmental Monitoring Plan (EMoP) and applicable environmental and social management practices stakeholder engagement and community relations.

2. Environmental Management Plan (EMP), Social Development Plan (SDP) and Corporate Social Responsibilities (CSR) Implementation

2.1 The EMP including the monitoring plan is continuously reviewed internally. Improvements are decided and carried out as soon as internal management approval is achieved. Third party environmental monitoring is being conducted for air and water quality. Table 1 shows the summary of the monitoring being conducted with the corresponding frequency. DENR-EMB approved test-methodologies were used for the determination of the parameters listed in Table 1 See Annex 1 for the Sampling Stations and Annex 2 for the monitoring results for the period July to December 2017.

Table 1. Monitoring Parameters and Frequency No. Item Parameters Frequency

1 Ambient Air Quality SOx, NOx, CO, TSP, Noise Annual

2 Ambient Noise Noise Annual

3 Source Emission SOx, NOx, CO, PM10 Once every two years DO, BOD, TSS, Oil & Grease, 4 Discharged Waterbody Monthly Surfactants, pH Chloride, TDS, Total Hardness, pH, Total 5 Potable Water Monthly Coliform Monthly (furnished by 6 Water Effluent DO, BOD, COD, TSS, TN, TP and pH MCIAA)

2.2 The Sewage Treatment Plant (STP) of MCIA was issued an ECC by EMB 7, and is operated and maintained by MCIAA. It is designed to accept a maximum of 900 cum/day. The system consists of the ff: 1 unit night soil receiving tank; 1 unit inlet chamber, 1 unit sludge thickener, 1 unit final sedimentation ditch, 1 unit disinfection tank, 1 unit outlet pond and 1 unit sludge drying bed. Discharge Permit for the STP was released November 13, 2017 and is valid until August 5, 2019.

2.3 Environmental preservation activities such as tree planting and participation to the Environmental Month Celebration are done every year. GMCAC’s tree planting program is spread out in five (5) years. A total of one hundred seven thousand and thirty two (107,032) seedlings comprising of 80% mangroves and 20% inland trees as per ECC requirement is targeted to be planted after program completion. See Annex 3 for the report.

2.4 Efforts have been exerted to formulate specific Health and Safety Programs. Orientations are being conducted to promote safety awareness. Workers are provided with the necessary health benefits including annual physical examination to all GMCAC employees. A Safety Officer under the supervision of the SQE Head has been designated to oversee all activities in relation to the safety of the employees. Regular Health and Safety meetings are conducted. See Annex 4 for the detailed H&S report.

2.5 Mactan Airport Emergency Plan is in place which includes: (a) Aircraft accident on and off the Airport, (b) Bomb Threats, (c) Ground Incidents, (d) Structural Fire, (e) Earthquake, (f) Hazardous Material Incident, (g) Aviation Pandemic Incident and (h) Crowd Control.

2.6 While GMCAC focuses in developing MCIA as a viable gateway, GMCAC is one with our partners in the City of Lapu-Lapu and in Cebu, as well as with MCIAA to contribute to societal, environmental and educational developments in the community where it operates; and to ensure humane and gender-sensitive workplace practices and conditions are set in place.

2.7 While GMCAC focuses in developing MCIA as a viable gateway, GMCAC is one with our partners in the City of Lapu-Lapu and in Cebu, as well as with MCIAA to contribute to societal, environmental and educational developments in the community where it operates. The SDP is being implemented through the monthly CSR programs.

Social Development Framework

VISION Developing sustainable and vibrant communities START HERE PILLARS EDUCATION SKILLS HEALTH & COMMUNITY TRAINING & ENVIRONMENT ENGAGEMENT/RELATIONS LIVELIHOOD MISSION Sparking Livelihood Promoting healthy Partnering with local dreams and creation through communities and stakeholders for sustainable transforming skills training environmental development in the lives through and livelihood stewardship through communities better access to development green initiatives and quality healthcare awareness education & services GOALS Strongly support 1. Empower 1. Provide healthcare 1. Understand the needs of and contribute to women and out- services and raise the community and the success of of-school youth awareness about addressing grievances DepEd’s key to become healthy lifestyle to through consultative programs: employable communities discussions through skills 2. CSR Team to assist 2. Respond to communities 1. Adopt-a- training the Environment Team needs affected by calamity School programs in the implementation and disaster 2. K to 12 Senior 2. Support and execution of High School organizations environmental 3. Alternative that provide compliance Learning System livelihood requirements and opportunities to initiatives on waste underserved material recycling sectors of the community

2.8 Corporate Social Responsibility Activities have been carried out monthly and are focused on the following areas: Education, Health, Livelihood, and Community Development. See Annex A for the detailed CSR report.

3. COMPLIANCE STATUS

3.1 Compliance with Country Requirements

3.1.1 GMCAC is implementing the best efforts to effectively comply and monitor applicable national and local environmental, social, occupational health and safety laws and regulations. This includes compliance to all conditions in relevant permits issued by all concerned Governmental Authority handling the environmental and social aspect.

3.1.2 In May 22, 2015, the project was granted its Environmental Compliance Certificate (ECC) by the Department of Environment and Natural Resources – Environmental Management Bureau (DENR- EMB). The conditions stated in this document are those that must be complied with, in consideration with the timing and related circumstances. Aside from the ECC, Table 2 shows the list of regulations GMCAC must comply with.

Table 2. List of Environmental Regulations No. Government Agency Environmental Law 1 Initial Environmental Examination Report

2 Toxic, Hazardous, and Nuclear Wastes Control Act (RA6969)

3 DENR-EMB Clean Air Act (RA8749)

4 Clean Water Act (RA9275)

5 Ecological Solid Waste Management Act (RA9003)

6 DOH - FDA RA 9711 – License to Operate an XRAY Facility

3.1.3 The compliance status of the ECC and EMP of the project summarizes GMCAC’s compliance to its environmental and social country requirements which is found in Annex 5.

3.1.4 Renewal of License to Operate an X-Ray Facility already submitted to DOH-FDA. See Annex 6 for the copy of the submitted renewal documents.

3.1.5 Stack Emission Testing was conducted for the two (2) gensets at T1 on May 25-26, 2016 by Environair Asia. Results for all parameters of both units namely; PM, SOx, NOx & CO were within the DENR Standards. This is required for the renewal of Permit to Operate from DENR-EMB. Next testing will be scheduled on 2018. Table 2 shows the summary of the results.

3.1.6 As per DAO 2017-15, Section 16.1 MMTs shall only be for Environmentally Critical Projects (ECP). All other MMTs including clustered MMTs shall be deemed automatically dissolved. ECC condition on the creation of MMTs for Non-ECPs shall be deemed invalid.

3.2 Compliance with ADB Safeguards Requirements

3.2.1 As a project financed by international lending institution, GMCAC sees to it that is compliant to the Lender’s environmental and social policies and guidelines. Table 3 shows status of compliance.

Table 3. Compliance Status to Safeguard Requirements Status of No. Remarks Compliance ENVIRONMENTAL SAFEGUARDS Preparation of an Initial 1 Complied. Done at the development phase of the project. Environmental Examination Establishment and 2 Complied. See Annex 4 for compliance status. implementation of an EMP Establishment and 3 Complied. See Annex 4 for compliance status. implementation of an EMoP Provision of a safe and Health and Safety programs are continuously 4 healthy working Complied. implemented. environment for workers Appointed domestic solid waste hauler, MANTECH pulls out accumulated domestic wastes at the Proper and sustainable 5 Complied. designated Central Waste Area on a daily basis. solid waste disposal An estimated 6 tons of domestic solid wastes are generated daily at MCIA. Proper storage, treatment Hazardous wastes are stored on site in a well- 6 and disposal of hazardous Complied ventilated area prior to treatment and disposal to wastes an accredited treater. Conduct environmental See Annex 3 for the related activities conducted 7 preserving activities or Complied. by GMCAC. programs SOCIAL SAFEGUARDS Conduct Information- A Community Consultation was conducted on Education and August 18, 2017 and December 21, 2017. See 8 Complied Communication (IEC) Annex B for the issues highlighted during the activities or programs Community Consultation. 9 Involuntary Resettlement Complied. No involuntary resettlement done The Project is located in Lapu-Lapu City, a highly urbanized city where there are no indigenous peoples, ethnic groups or tribal groups that fall 10 Indigenous People NA under the category of indigenous peoples as described in ADB’s SPS Safeguards Requirement 3: Indigenous Peoples. HR Policy of GMCAC covers procedures dealing with sexual harassment. Airport facilities design 11 Gender and Development Complied. have features deemed beneficial to women, children and people with reduced mobility (PRM / PWD)

3.2.2 A 3rd Party service provider, Environ Air Asia Inc., was appointed by GMCAC to conduct ambient air quality monitoring within the boundaries of the aerodrome (Annex 1). The sampling activity was conducted on April 24-25, 2017 and is planned to be done every year thereafter. As shown in Annex 2, monitoring results indicate that all parameters are within the DENR-EMB and IFC Air Quality Standards.

3.2.3 Wastewater effluent both from STP and Storm drain were sampled and tested last August and November 2017. The sampling was conducted by Technolab, a 3rd party laboratory appointed by GMCAC. As shown in Annex 2, monitoring results indicate that all parameters are within the DENR- EMB and IFC Water Quality Standards.

3.2.4 All hazardous waste generated from the last hauling date up to present are stored at the Central Waste Storage Area. See Annex 5 for the summary.

3.2.5 Construction of Central Waste Storage Area already done. All non-hazardous solid wastes generated at MCIA will be disposed at the area, prior hauling of the third party service provider. Segregation of wastes at source already implemented.

3.2.6 A Community Consultation was conducted on December 21, 2017 and was attended by representatives from the Lapu-Lapu City local government unit (LGU), surrounding airport communities, schools, and other community organizations. The consultation discussed the Project details and status, environmental and social impacts and the corresponding mitigation measures, disclosure of grievance mechanism, and Corporate Social Responsibility Action Plan. After the presentations, an ample time was provided for the participants to raise their Grievances and Inquiries. See Annex B for the summary and issues highlighted during the Community Consultation.

4. HEALTH and SAFETY

4.1 Labor Conditions & Standards

4.2 Work Permit System currently being implemented at GMCAC. Contractors and service providers doing work at MCIA apply for a work permit to ensure that GMCAC work safety standards are adhered to. Permit has a validity of one week.

4.3 Safety orientation conducted for all contractors and other concessionaires operating within MCIA.

4.4 Daily hazard reporting (Unsafe Act, Unsafe Condition) from other GMCAC department.

4.5 Incident reporting and Incident Investigation, corrective and preventive action monitoring.

4.6 Various fire emergency response equipment are currently being procured. Trainings pertaining to response to fire emergencies were conducted during the quarter to GMCAC personnel and selected stakeholder staff.

5. SUSTAINABLE DEVELOPMENT INITIATIVES AND COMMUNITY RELATIONS

5.1 GMCAC’s tree planting program is spread out in five (5) years. A total of one hundred seven thousand thirty two (107,032) seedlings comprising of 80% mangroves and 20% inland trees as per ECC requirement is targeted to be planted after program completion.

5.2 GMCAC’s corporate social responsibility programs would be initiated in the two directly impacted Barangays in its immediate neighborhood – Barangay Pusok and Barangay Ibo, however, it will still maintain strong community engagements with other surrounding communities in Lapu-Lapu City. Its various interventions would be covering Education, Health, Livelihood and overall Community Development of the communities around the Airport. See Annex A for the summary of CSR activities for this monitoring period.

Annex A - Summary of CSR Activities

CSR PROGRAMS ACTIVITIES EDUCATION • In October, GMCAC conducted an initial assessment with Pusok National High School (PNHS), in coordination with the Philippine Business for Social Progress, to know the support needed in their implementation of the Senior High School Work Immersion Program. It was agreed that prior to the Work Immersion, it is best that GMCAC will hold a Career Orientation Caravan in schools so that the students and teachers will know the various careers that they can pursue in the airport. • A month after the initial assessment with PNHS, GMCAC participated in DepEd’s consultation regarding the implementing rules and guidelines of the Senior High School Work Immersion Program (SHS WIP). The consultation was largely attended by schools and private organizations/companies that are interested in supporting the SHS WIP. HEALTH • GMCAC conducted a three-month nutrition program for Soong Dumpsite Community dubbed as “The Gift of Nutrition Feeding Program” for the benefit of 100 undernourished children. This program was in partnership with Rotary of Mactan and Soong Elementary School. Starting December 2017 until March 2018, food supplements and nutrition meals were provided to 100 selected undernourished children. The program also provided nutritional awareness to the parents through weekly meetings. LIVELIHOOD • In July 14, 2017, GMCAC had a consultative meeting with the Philippine State College of Aeronautics (PHILSCA) regarding future partnership on Skills Training Program. Currently, PHILSCA has a Community Extension Service that offers 15-day training program on Welding, Electrical Packaging, and Airline Catering for out-of-school youth. COMMUNITY • There were no Community Development programs organized in this DEVELOPMENT monitoring period.

Annex B - Summary and Highlights of the Community Consultation

I. Congressional Transportation Committee Consultative Meeting

On August 18, 2017, The Congressional Transportation Committee visited the Mactan Cebu International Airport in an official capacity on August 18, 2017 for a consultative meeting with the following agenda:

1. To hold a consultative meeting with LGU representatives, together with the media, about Cebu transportation-related projects such as the MCIA T2 and Cebu Port projects 2. To do an ocular inspection of the Terminal 2 site 3. To discuss and review the aircraft parking bay congestion at MCIA

Aside from the Cebu district representatives, representatives from the Lapu-Lapu City (LLC) LGU such as Mayor Paz Radaza and LLC Tourism Officer Hembler Mendoza were also present during the consultative meeting.

During the consultative meeting, GMCAC Chief Executive Advisor presented to the participants the developments in Terminal 1 and the consortium’s second runway proposal. After the consultative meeting, an ocular tour at T2 was conducted by MGCJV.

Table 1. List of attendees present during the Congressional Transportation Committee Consultation held Waterfront Airport Hotel and Casino on August 18, 2017

NAME REPRESENTATION 1 Rep. Edgar Mary Sarmiento • , 1st District (1st term) • Vice-Chair, Transportation (and Dangerous Drugs) 2 Rep. Gwendolyn Garcia • Cebu, 3rd District • Deputy Speaker – Transportation 3 Rep. Benhur L. Salimbangon • Cebu 4th District • Member – Transportation Committee 4 Rep. Aileen Radaza • Lapu- Lapu City Lone District (2nd term) • Member – Transportation Committee

5 Atty. Edward S. Relucio • Consultant of Transportation Committee Chairman Cesar Sarmiento 6 Ms. Antonia Gil • Secretary –Transportation Committee 7 Mayor Paz Radaza • Lapu-Lapu City Mayor 8 Hembler Mendoza • Lapu-Lapu City Tourism Officer 9 Atty. Steve Dicdican • MCIAA General Manager 10 Maryann Dimabayao • MCIAA Public Affairs OIC 11 Evelyn Ramirez • MCIAA Board Secretary 12 Joshur Judd Lanete • DOT Regional Director 13 Asec. Daniel Angelo Mercado • DOT Assistant Secretary 14 Atty. Rafael Tatlonghari • Civil Aviation Authority 15 Engr. Eduardo Destura • Philippine Reclamation Authority

Table 2. Summary of Feedback/Concerns gathered during the Congressional Transportation Committee Consultative Meeting

Stakeholder Participants Feedback/Concerns

Rep. Benhur Salimbangon Cong. Salimbangon is impressed with the project because it is on schedule despite of the challenges met in terms of the land handover.

He said that the project brings great pride to see this major development in Cebu infrastructure and is excited of the progress that it will bring to Cebu and to the rest of the Cebu provinces.

Rep. Salimbangon openly suggested that his District and its tourism industry would greatly improve if the Sta. Fe Airport will also be developed. Rep. Gwendolyn Garcia (Cebu Cong. Garcia commended the world-class infrastructure and expressed 3rd District) support to the 50-year masterplan proposal of GMCAC that includes the construction of a second runway.

She also commended the new direct flights that were recently launched but also mentioned that GMCAC needs to prepare for the expected air & ramp traffic congestion due to the increased number of flights out of Mactan Airport. Rep. Aileen Radaza Rep. Radaza saw no problem with the proposed 2nd runway but she (Representative of the Lone urged GMCAC to conduct consultations with the communities that may District of Lapu-Lapu City) be affected by the possible relocations.

She also stressed the importance of aligning with the Lapu-Lapu and Cordova LGUs and the DPWH so that the proposed second runway will not affect the planned 4th Mactan bridge.

Rep. Edgar Sarmiento Rep. Sarmiento lauded the 50-year masterplan proposal and said that it is the right time to plan the future developments for Cebu.

Mayor Paz Radaza Mayor Radaza lobbied for a change in the structure and representation in the MCIAA Board and stated that a representative from the Lapu- Lapu City should also be given a seat in the Board as a Director. The Mayor insisted that it is important to have a MCIAA Director representing Lapu-Lapu City because it is the location of the Mactan Airport.

MCIAA General Manager Steve Dicdican replied to the Mayor that he has received the proposal from the Mayor’s Office and that the Board has started to review the said proposal.

II. GMCAC Consultation Meeting

On December 21, 2017, a community consultation was organized wherein key people from the Lapu-Lapu City local government and representatives from the barangays situated around the airport were invited. The agenda of the said consultation were:

1. To provide updates on the progress of Terminal 2 construction 2. To present relevant information on the environmental concerns and measures taken by MCIA 3. To present CSR activities undertaken as well as next steps to be taken by GMCAC 4. To give an opportunity for the community to raise feedback and concerns as well as suggestions to address the concerns

Terminal 2 Construction Updates Led by MGCJV, the presentation of construction updates of Terminal 2 highlighted the completion and installation of most of the key features including installation of the new baggage handling systems, escalators and elevators, power supply, passenger boarding bridges, new equipment, materials of the roof and the flooring at the departure and arrival levels.

MCIA Environmental Updates

MGCJV and GMCAC presented and addressed environmental concerns and updates to stakeholders. The discussion focused on the community’s concern on aviation noise and possible congestion of the airport most especially with the opening of Terminal 2 in June 2018.

Table 1. List of attendees present during the Community Consultation held in Mactan-Cebu International Airport on December 21, 2017.

Table 2. Summary of Feedback/Concerns gathered during the Community Consultation