REVISED RESETTLEMENT PLAN

Fengqiu County Seat Wastewater Treatment Project

Under

Henan Wastewater Management and Water Supply Sector Project

IN THE

PEOPLE’S REPUBLIC OF CHINA

Fengqiu Construction Bureau August 2006

The resettlement plan 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.

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Endorsement Letter of the Resettlement Plan

Fengqiu County Construction Bureau has prepared the resettlement plan for Asian Development Bank (ADB) financed wastewater treatment project in our county. This resettlement plan fully complies with requirements of the relevant laws, regulations and policies of People’s Republic of China and Henan Province as well as complies with ADB’s policy on involuntary resettlement.

Fengqiu County People’s Government hereby confirms the content of this resettlement plan and will guarantee the land acquisition, compensation and relocation budget being provided according to the provisions of this resettlement plan. This resettlement plan is based on the detailed design and the detailed measurement surveys.

Signature of Deputy Head of the County: Gao Guorui

Fengqiu County People’s Government

August 18th, 2006

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ABBREVIATIONS

RP Resettlement Plan APs Affected Persons ADB Asian Development Bank DMS Detailed Measurement Survey PMO Project Management Office AAOV Annual Average Output Value WWTP Wastewater Treatment Plant/Project PPO WWTP Project Preparation Office LARO Land Acquisition and Resettlement Office VCRLT Village Committee Resettlement Leading Team DI Design Institute MEA Monitoring and Evaluation Agency TA Technical Assistance EA Executing Agency IA Implementing Agency RIB Resettlement Information Brochures NGO Nongovernmental Organization TOR Terms of reference HWMWSP Henan Wastewater Management and Water Supply Project LAR Land Acquisition and Resettlement

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Table of Contents Executive Summary...... 7 1 Introduction and Project Description ...... 9 1.1. Introduction ...... 9 1.2. Project Background ...... 9 1.3. Project Description ...... 10 1.3.1. Project Location ...... 10 1.3.2. Main Construction...... 10 1.3.3. Investment Estimation and Implementation Schedule...... 10 1.3.4. Benefits of the Project...... 10 2 Socioeconomic Background of the Affected Areas ...... 12 2.1 Background of the City Affected by the Project...... 12 2.1.1 Features of the city ...... 12 2.1.2 Urban Layout ...... 12 2.1.3 Population...... 12 2.1.4 Natural Conditions ...... 12 2.2 Basic Situations of Affected Areas ...... 12 2.3 Socioeconomic Background of the Affected Villages ...... 13 2.3.1 Impacts of Permanent Land Acquisition and Resettlement ...... 13 2.3.2 Regions Affected by Temporary Land Use ...... 13 2.3.3 Socioeconomic Conditions of the Displaced Households Affected by the Project ... 14 2.4 Sampling Survey on the APs ...... 14 2.4.1 Statistic characteristics of APs ...... 14 2.4.2 Scale of the Families Interviewed...... 14 2.4.3 Time of Living in the village...... 15 2.4.4 Average annual family income and expenditure per household ...... 15 2.4.5 Minority Families and Vulnerable Groups...... 16 2.4.6 Willingness of Compensation for Land Acquisition...... 16 2.4.7 Willingness to obtain training...... 17 2.4.8 Information about the Project and Land Acquisition ...... 17 2.4.9 Understanding and attitudes ...... 18 3. Project Impacts ...... 19 3.1 Types of loss Caused by Land Acquisition ...... 19 3.2 Measures to Minimize Land Acquisition...... 19 3.2.1 Measures to minimize land acquisition during project design...... 19 3.2.2 Measures to Minimize Land Acquisition and Resettlement augmented in Construction Stage 20 3.3 Project Impacts...... 20 3.3.1 Survey Methods...... 20 3.3.2 Summary of Project Impacts ...... 21 3.3.3 Cultural Relics and Vulnerable Groups ...... 22 3.3.4 Public Concerns...... 22 3.4 Project Impact Analysis ...... 22 4. Legal and Policy Framework...... 23 4.1 The Main Law and Policy of Resettlement Foundations ...... 23 4.1.1 Legal framework ...... 23 4.1.2 Relevant Legal Extracts ...... 24 4.2 ADB Policy on Involuntary resettlement...... 29 4.2.1 Overall Objective of ADB Involuntary Resettlement Policy...... 29 4.2.2 Resettlement Plan Preparation ...... 30 4.3 Resettlement Objectives and Planning Principles...... 30 4.3.1 Resettlement target...... 30 4.3.2 Resettlement planning principles ...... 31 4.4 Compensation Rate...... 31 4.4.1 Compensation Principle ...... 31 4.4.2 Compensation Rates for Land Acquisition and Resettlement...... 32 farmland...... 32 4.4.3 Cut-off Date...... 33

4 4.4.4 Payment of Compensation...... 33 4.4.5 Procedures for Compensation Payment ...... 33 4.4.6 Eligibility and Entitlement for Compensation ...... 34 5 Compensation and Rehabilitation Measures ...... 36 5.1 Resettlement Strategy...... 36 5.1.1 Resettlement Objective...... 36 5.1.2 Principle of RP ...... 36 5.2 Rehabilitation Measures for Permanent Land Acquisition...... 36 5.3 Rehabilitation Plan for Temporary land use...... 38 5.4 Women Rights Protection...... 38 6 Institutional and Organizational Structure ...... 39 6.1 Institutional Framework ...... 39 6.2 Institutional Framework and Responsibilities...... 39 6.3 Staffing ...... 40 6.4 Measures to Strengthen Institutional Capacity Building ...... 41 7. Public Participation and Consultation...... 42 7.1 Public Participation...... 42 7.1.1 Resettlement Information Brochures (RIB)...... 42 7.1.2 RP Distribution...... 42 7.1.3 Public Consultation in Project Preparation Phase ...... 42 7.1.4 Public Participation and Consultation in Implementation Phase...... 45 7.2 Grievance Redress Procedures...... 46 7.2.1 Targets for Grievance Redress Procedure ...... 46 7.2.3 Grievance Redress Scope ...... 46 7.2.4 Grievance Result ...... 46 8. Monitoring & Evaluation...... 48 8.1 Internal M&E...... 48 8.1.1 Main Monitoring Contents ...... 48 8.1.2 Internal Monitoring Objectives...... 48 8.2 External M&E ...... 48 8.2.1 External Monitoring Objectives ...... 48 8.2.2 Means and Methods ...... 49 8.2.3 Reporting Requisition...... 49 8.2.4 Resettlement M&E Outline...... 49 9. Resettlement Budget ...... 51 9.1 Contents of Resettlement Costs ...... 51 9.1.1 Land Acquisition & Resettlement...... 51 9.1.2 Infrastructure and Facility...... 52 9.1.3 Other Costs...... 52 9.1.4 Contingencies ...... 52 9.2 Budget Table on Resettlement Costs...... 52 9.3 Resettlement Investment Plan...... 55 10 Implementation Arrangements and Schedule...... 54 10.1 Principles on Confirming Resettlement Schedule ...... 54 10.2 Overall Schedule of Land Acquisition and Resettlement Activities...... 54 11. Due Diligence and Retrofif Measures...... 62 11.1 Due diligence...... 62 Appendix 1 Minutes of Group Meeting with Parts of Village Leaders, Enterprises and Public Representatives...... 65 Appendix 2 Minutes of Negotiation Meeting on Resettlement and Rehabilitation...... 67 Appendix 3 The List of Fengqiu County WWTP Leader Group ...... 70

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Tables

Table 2.1 Socioeconomic Situation of the Villages Affected by the Project...... 13 Table 2.2 Socioeconomic Profile of the Village and Households Affected by Permanent Land Acquisition ...... 14 Table 2.3 Educational Background of the APs in Survey...... 14 Table 2.4 The Scale of the Familes Interviewed...... 15 Table 2.5 Living Duration in the village...... 15 Table 2.6 Annual Income and Expenditure Structure of the Families Interviewed ...... 16 Table 2.7 Willingness of Compensation for Land Acquisition ...... 17 Table 2.8 Affected Laborers’ Willingness to Obtain Reemployment Training...... 17 Table 2.9 Information Sources and Time Concerning the Project and Land Acquisition...... 18 Table 2-10 The APs’ Attitude and Opinion Towards the Project...... 18 Table 3.1 The Categories and Quantities of the Land Permanently ...... 21 Table 3.2 The Profile of the Farmland Temporarily Affected by the Pipeline Network...... 21 Table 3.3 Types and Quantity of Infrastructure and Facilities ...... 22 Table 3.4 Analysis on Permanent Land Acquisition...... 22 Table 4.1 Compensation Standard of AAOV ...... 29 Table 4.2 Abstract of Resettlement Principles ...... 31 Table 4.3 Compensation Rates Calculation for Permanent Land Acquisition ...... 32 Table 4.4 Compensation Rates for Permanent Land Acquisition...... 32 Table 4.5 Compensation Rate for Temporary Land Use...... 33 Figure 4.1 Compensation Payment Procedures for Permanent Land Acquisition ...... 34 Table 4.6 Entitlement Matrix...... 35 Table 6-1 Resettlement Organization Staffing Referred in the Project...... 41 Table 7.1 Public Participation During TA to the Project...... 44 Table 7.2 Public Participation Plan...... 45 Table 8.1 Resettlement M&E Outline ...... 50 Table 9.1 Cost Estimation for Land Acquisition and Resettlement of Fengqiu County WWTP project... 53 Table 9.2 Resettlement Investment Plan by Stages ...... 54 Table 10-1 Schedule of land Acquisition and Resettlement Activities...... 61

6 Executive Summary

A. Background and Impacts Assessment

1. The designed treatment capacity of the Project is 30,000m3/d. The main construction consists of one wastewater treatment plant, one pumping station, 56.171km wastewater main and branch pipelines. 2. T he wastewater treatment plant of the Project needs to expropriate 49.93mu arable land permanently, all of which is rural collective owned. And all of the temporarily occupied land is chosen within the permanently acquired land scope, which doesn’t need borrow other land.

3. During the construction of pipeline network, it will temporarily occupy roads, amounting to 445mu of state-owned land.

4. The affected persons (APs) of the Project refers to the actual affected ones which amounts to 20 households with 95 persons, and all of them are agricultural population and no minority.

B. Policy Framework and Entitlements

5. The resettlement principle of the Project indicates legal and law requisitions of PRC and ADB. And that for compensation, resettlement and income rehabilitation is so flexible to permit difference between villages and communities of cities, which exists in kind and cash compensation and selection of income rehabilitation between community-based and private organizations. The key point is to ensure that all the APs get sufficient compensation and assistance with income rehabilitation after land acquisition and demolition. The main purpose of RP is to rehabilitate APs’ income and living standard minimizing the damage on their own economic and social environment. Special attention has been given to meet the need of the affected underprivileged and vulnerable groups. An entitlement matrix has been formulated to specify eligibility and entitlements for compensation and rehabilitation measures. The matrix covers all varieties of loss including temporary/permanent income sources.

C. Rehabilitation and Income Restoration

6. All affected persons will be compensated as set out in the project entitlement matrix in this RP. During Project implementation, efforts will be made to further minimize the land acquisition and resettlement impacts.

7. The income restoration and rehabilitation measures have been formulated in this RP according to the local economic situation and the purpose is to guarantee the living standards and livelihood of the affected persons equal or better than the ones before the project. These income restoration and rehabilitation measures have been developed in consultation with all affected persons and they have reflected the most practical ways for the easy implementation during the project.

D. Institutional Arrangements

8. In order to fulfill the resettlement, Fengqiu County Government, Construction Bureau, Land Administration Bureau and Finance Bureau have established a leading group comprised by the responsible leaders of every bureau to supervise all the key activities involving land acquisition and resettlement and an office under the leading group has been created with the staff from IA and the other concerned local agencies for daily administration and implementation of resettlement plan. 7 E. Public Consultation and Disclosure

9. During the preliminary preparation phase, public participation and consultation is a significant approach. And also in the different preparation stages of the project it was conducted so that the information on the probable impact of the Project is expanded among the APs. The RIB has been handed out to all the APs and its English version was loaded on the website of ADB.

F. Complaints and Grievances

10. Appeal procedure was set up to solve the probable disputes timely and transparently to ensure the Project being carried out smoothly. Apart from the existing grievance and appeal channels set up by the governments at all levels, an open and effective appeal channel is set up for the APs in particular.

G. Monitoring and Reporting

11. Implementation of the resettlement plan will be monitored internally and externally. The IA is expected to assume responsibilities for the internal monitoring. District land acquisition and resettlement offices will be staffed with the independent supervisors. Fengqiu Construction Bureau will compile the quarterly report (from the third quarter of 2006, as Project commenced) to submit to ADB, with contents cover the implementing progress of resettlement plan, emphasizing whether it conforms to the principle set forth in the Resettlement Plan and requirements in the compensation entitlements matrix. The IA will engage independent monitoring organizations to make external monitoring together with the ADB, prepare evaluation report on the resettlement progress after commencement of construction, specifying the distribution of the compensation, and other measures to maintain or improve the affected persons’ social and economic living conditions against the conditions before the project.

H. Cost Estimate of Resettlement

12. According to the detailed design and resettlement survey, the resettlement costs are estimated to be CNY 11.38 million, including 15% contingency cost due to the preliminary estimate on the possibly affected groups. The compensation and resettlement budget will be adjusted based on the actual measurement of physical losses during the project implementation. The EA will ensure adequate funding for resettlement implementation and will provide budgets as necessary to meet eventual shortfall that emerges in achieving the resettlement objectives.

8 1 Introduction and Project Description

1.1. Introduction In accordance with ADB policies on involuntary resettlement and other principle regarding social securities along with related social aspects, this resettlement plan is developed in reference to PRC’s laws/regulations and local governments’ policies on land acquisition and resettlement. This plan describes a policy framework to mitigate the adverse impacts caused by the proposed project of Fengqiu wastewater treatment in its county seat through series of remediation measures. Also the resettlement plan for the affected people and rehabilitation plan for the seriously affected villages are also specified including how and when to take these measures.

As Chinese governments and ADB are concerned, the primary purpose of resettlement plan is to ensure the people who unavoidably lose lands or properties in the development project have the same or better livelihood and living standards compared with that under “no-project” situation. All the policies, suggestions and compensation measures in this resettlement plan are oriented to this purpose. The implementation agency (IA) has organized the Fengqiu wastewater treatment plant LARO to construct and manage this Project. Fengqiu Construction Bureau will directly assume the responsibility for the preparation, implementation, internal monitoring and financing of the resettlement plan.

This resettlement plan is formulated the following basis: (1) “City Planning Act of PRC” (2) “Land Administrative Law of PRC” (3) “Interim ordinance of PRC on Farmland Occupation” (4) “Decision of the State Council on the Strengthening of Land Management through Deepening the Reform”, October 21st, 2004” (5) “Implementation Rules for Land Administration Laws of Henan Province” (6) “Xinxiang Municipal Government’s Announcement of Compensation Rates at AAOV for National Construction” (7) ADB’s “Involuntary Resettlement Policy” (8) Relevant project reports.

This resettlement plan covers all aspects of resettlement and income rehabilitation caused by the construction of the proposed wastewater treatment plant, wastewater collecting system and recycled water supply system.

On the basis of the FSR and the preliminary designing report, this plan is made after survey on land acquisition and demolition impact and socioeconomic survey. The plan has been updated based on detailed design and this revised RP was approved by Fengqiu People’s Government in August 2006.

1.2. Project Background For the moment the drainage system of Fengqiu County seat is a combined system of storm water and sewage. Since the drainage system is not perfect with lack of integrated planning and standardization and lack of wastewater treatment facility, great deal of living and industrial wastewater in the urban area has not been treated before directly draining to Tianran and Wenyan Channels and ultimately flows to Huanghe River, which severely pollutes the water quality of Huanghe River. According to the overall urban planning of Fengqiu County, the drainage system will take use of separation system of storm water from sewage. The existing pipeline or channel system acts for the storm water drainage after separation. This project will construct new wastewater collection system to gather wastewater to the treatment plant for secondary biochemical treatment. Tianran and Tenth Branch channels are the main rivers in Fengqiu County. Without treatment the wastewater is drained directly into Tianran and Tenth 9 Branch, which severely pollutes the river water and underground water deteriorating functions of water body. The monitoring data shows that 51.78% of the pollutants filter into the ground, polluting ground water sources, making them loses basic functions of ordinary water body. The deterioration of water environment has had serious effects on the agricultural and industrial production and residents’ living in the basin and disturbs or restrains steady economic development of the local area and the lower areas.

1.3. Project Description 1.3.1. Project Location The proposed plant will be constructed in the middle area of Fengqiu county seat in terms of north to south, in the north of Zhenxing Road and west of Tianran Channel, experiencing convenient traffic. The plant site lies in average farmland, with relatively perfect foundation for long term and short pipelines for convenient drainage, electricity supply and water supply. And therefore it is convenient to collect wastewater in urban areas. Also the wastewater main pipeline is relatively shorter to ensure that the wastewater can flow to the wastewater treatment plant naturally. The site is east to Tianran Channel, south to Sanlixin, west to the urban area and north to Shizhuang.

1.3.2. Main Construction The designed treatment capacity of the Project is 30,000m3/d. The main construction consists of one wastewater treatment plant, one pumping station, 56.171km wastewater main and branch pipelines. The employed treatment method is chloridized hook techniques. After treatment of the wastewater, it will meet the water needs of some industrial enterprises in the urban area and the rest will be used for farmland irrigation, covering 8km2 with a population of 100,000.

1.3.3. Investment Estimation and Implementation Schedule The investment on this project is estimated to be CNY 75.33 million, among which CNY 37 million is from ADB. ·The preliminary phase of the Project was from March 2004 to March 2005 to complete the authorizing and examining job of the project feasibility Study report, verifying the adequacy of the available water resource, and evaluation of environmental impacts. ·The pre-construction phase (1) was from July 2004 to November 2005 to complete the preliminary design, detailed design for construction, and corresponding procedure for examination and approval. In December 2005 the pre-approval of the land use had been reached (No.627[2005] Notice of Henan State Land Resource). · The pre-construction phase (2) was from January 2006 to April 2006 to complete the social preparation including the site grading job, etc. · The pre-construction phase (3) was planned from August 2006 to September 2006 to complete civil work of wastewater pipeline, civil work of facility and wastewater treatment plant, public bidding and evaluation for facilities and sign construction contract of the Project. ·The project construction is planned from September 2006 to September 2007 to conduct all the construction activities including civil works, pipeline and facilities equipment and etc. ·Debugging and Trial-running period is planned from October 2007 to December 2007 to complete debugging and trial-running of the project. ·Completion and reception period is planned in December 2007 to complete the project and finish the check and reception activities.

1.3.4. Benefits of the Project

In accordance with overall planning of Fengqiu County and combined with actual conditions, it is estimated that the county urban population will amount to 100,000 in 2010 and the gross

10 production of agriculture and industry will amount to CNY1.2 billion. Along with the population increase and living standard development, the living and industrial water use will increase as well and at the same time the wastewater drainage and pollutants will increase accordingly. If no treatment measure is to be taken in time, the pollution of water bodies will worsen and water environment quality will deteriorate, which must do severe effect on local economic development and people’s health.

Fengqiu is one of the significant cities protected and cured in Huanghe River basin. To treat water pollution of Fengqiu County determines whether the water quality becomes clear, whether the people’s living is safeguarded, whether economy develops rapidly and whether the environment is improved and therefore its meaning is very significant. For the moment the drainage system of Fengqiu County seat is a combined system of storm water and sewage. Since the drainage system is not perfect with lack of integrated planning and standardization and lack of wastewater treatment facility, great deal of living and industrial wastewater in the urban area has not been treated before directly draining to Tianran and Wenyan Channels and ultimately flows to Huanghe River, which severely pollutes the water quality of Huanghe River. According to the overall urban planning of Fengqiu County, the drainage system will take use of separation system of storm water from sewage. The existing pipeline or channel system acts for the storm water drainage after separation. It is to construct new wastewater collection system to gather wastewater to the treatment plant for secondary biochemical treatment. Tianran and Tenth Branch channels are the main rivers in Fengqiu County. Without treatment the wastewater is drained directly into Tianran and Tenth Branch, which severely polluted the river water and underground water deteriorating functions of water body. The monitoring data shows that 51.7% of the pollutants filter into the ground, polluting ground water sources, making them loses basic functions of ordinary water body. The deterioration of water environment has had serious effects on the agricultural and industrial production and residents’ living in the basin and disturbs or restrains steady economic development of the local area and the lower areas.

Urban drainage facilities and wastewater treatment project is an important component of urban infrastructure, which will directly influence the operations of every urban function. Thus Fengqiu governments at all levels have paid sufficient attention to this. In the short-term planning it is clearly stated to improve living service facilities and to construct urban infrastructure and basic environmental facilities for sustainable development of Fengqiu County. As a result, the construction of wastewater treatment project conforms to the development need of the County and plays a significant role for the improvement of urban infrastructure. The rivers become clear and environment become nicer, improving residents’ living conditions and developing people’s health and more helpful conditions for tourism development and investment environment as well.

Going along with State’s strengthening environmental protection, the appendix to the notice of Urban Wastewater Treatment and Pollution Prevention and Cure Technology Policy(Urban Construction [2000]No.124) published by the Construction Ministry, National Environmental Protection Head Bureau, and Science and Technology Ministry clearly states that the wastewater treatment rate of townships should not be less than 70% and the medium city should at least construct one urban wastewater treatment plant. Currently there is no urban wastewater treatment plant in Fengqiu County. In accordance with the state policy, to construct such a plant in Fengqiu is to respond to the national development policy.

To sum up, from every perspective, it is quite necessary to construct urban wastewater treatment project in Fengqiu and after its completion it will produce fairly good economic, social and environmental benefit, which is helpful for Fengqiu sustainable development.

11 2 Socioeconomic Background of the Affected Areas

2.1 Background of the City Affected by the Project

2.1.1 Features of the city Fengqiu locates in the northeast of Henan Province, to the southeast of Xinxiang urban area, with the east longitude between 114°14′and 114°46′and the north latitude between 35° 53’ and 35°14’. Huanghe River flows through its east and south boundary, Kaifeng Municipal and Lankao County on the other side of Huanghe River, north and northeast to Huaxian and Changyuan counties and west and southwest to Yanjin and Yuanyang counties. It covers 48.7km in width from east to west and 38.2km in length from south to north with the total area of 1224.6km2, including 9.6km2 for urban area with 70,000 persons. It lies among the large and medium cities including Xinxiang, Kaifeng, Puyang and the like. It is 100km from Zhengzhou, 62km from Xinxiang and only 30km from Kaifeng. The Tianran Channel crosses the south of urban area from southwest to northeast and The Tenth Branch Channel of Wenyan crosses the urban area from south to north. Fengcao Highway lies to the south of county seat, 106 State Road is to the east, Xinhe Railway is to the north and Xinchang Highway crosses the county seat, which provides the county seat with convenient traffic.

2.1.2 Urban Layout Fengqiu County is considered a poverty county at state level, and lying in the inland region of the Peoples’ Republic of China, beyond the more prosperous coastal region. It is a relatively small scale city with a diverse range of economic activity, dominated by machinery, chemicals and the processing of agricultural by-products.

2.1.3 Population The urban population is 70,000 at present and it’s planned that by 2010 it will reach 100,000.

2.1.4 Natural Conditions ● Weather Belonging to the warm temperate zone, it has the features of the continental monsoon climate. The sunlight time duration is on the top of the other areas all over the province and annual average sunlight amounts to 2310.4 hours, with sunlight rate of 52%; in the usual years the average temperature is between 13.5℃ and 14.5℃ with no more than 1℃ of the annual climate swing; average ground temperature is 16.5℃ which is 2.6℃ higher than the annual average temperature; in the usual year annual average frost-free time duration is 214 days; average rainfall amounts to 615.5mm with large change in different years and in the same year the rainfall of different seasons is not balanced, much in summer and it gets more and more from west to east; the main wind direction in winter is from north, that in summer is from south partially, that of the whole year is from northeast and partially from north, and then secondly it is from southwest and partially from south, belonging to the monsoon climate; in the prefecture the climate disasters are flood, drought and etc, which do much effect on crops.

2.2 Basic Situations of Affected Areas The gross domestic production of the county is CNY2.36 billion in 2003, which has increased 13.5% last year. Among the gross production, increased 6.5% last year, CNY 0.98 billion is from the primary industry, increased 22.6%, CNY 0.65 billion is from the secondary industry, and increased 15.65%, and CNY 0.74 billion is from the tertiary industry. The average income of rural residents is CNY 2053, increased 5.2% last year. The local financial income of the whole county is CNY98 million, increased in 8.2%.

12 2.3 Socioeconomic Background of the Affected Villages

2.3.1 Impacts of Permanent Land Acquisition and Resettlement The permanent land acquisition of the Project involves Xinzhuang village in Chengguan Town. For analysis of project impact and compilation of feasible RP, in May 2004, the project units established a survey group to carry out a survey on the socio-economic situations and living and productive situations of the two villagers in 2003. The survey shows that the Project locates in the west part of the county seat planning area and the basic situations are shown in the following Table 2.1. Table 2.1 Socioeconomic Situations of the Villages Affected by the Project

Item Xinzhuang village of Chengguan town

I. Total population (person) 1080

II. Total household (household) 280

III. Labor(person) 712

1、Agriculture 285

2、Construction 187

3、Communication and transportation 43

4、Others 197

IV. Arable land area (mu) 750

1. arable land area per capita (Mu/capita) 0.7 2. land (water irrigated land) acquisition area 49.9 planned (mu) 3. arable land area after land acquisition per 0.7 capita (mu/capita) V. Net income per capita(Yuan/capita) 1150

1. Planting industry 780

2. Forestry 0

3. Aquaculture 340

4. Others 530

2.3.2 Regions Affected by Temporary Land Use The temporary construction land refers to the land temporarily borrowed during construction phase, including sand and stone materials plant, mixture plant, productive and living areas in construction phase and temporarily occupied road. And all of the land temporarily occupied for the plant is chosen within the permanently acquired land scope, which doesn’t need to borrow other land. For the construction phase of pipeline network, it will temporarily occupy roads, amounting to 445mu state land.

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2.3.3 Socioeconomic Conditions of the Displaced Households Affected by the Project The affected persons (APs) of the Project refers to the actual affected ones which amounts to 20 households with 95 persons and all of them are agricultural population and there is no ethnic minority. The detail statistics are shown in the following table 2.2. Table 2.2 Socioeconomic Profile of the Village and Households Affected by Permanent Land Acquisition

Population arable land Families Arable land Households Population of area per Village Of agriculture area （household） (person) agriculture capita (household) (mu) (person) (mu/capita) Xinzhuang 20 20 95 95 66.5 0.7

2.4 Sampling Survey on the APs To acquire the basic information on the income and expenditure of the APs, a random sampling survey, which covers 20% (62 households with 220 persons) of the people in the affected villages, was conducted by Fengqiu County Waste Water Treatment Plant. The integrated analysis of the survey result is shown as follows.

2.4.1 Statistic characteristics of APs

Among the respondents 105 are male and 15 are female, whose ages range from 17 to 66 with the average age of 36. As for their marital status, 154 70%) of them have been married and 66 are single (30%).

The detailed educational background of the APs in the survey is presented in Table 2.3. Table 2.3 Educational Background of the APs in Survey

Educational background No. of cases （person） Percentage of cases (％) Primary school 37 17 Junior school 121 55 Senior school 39 18 Post secondary school 20 9 College and above 3 1.4 Total 220 100

2.4.2 Size of the Families Interviewed Among the 62 families interviewed, each family has 1 to 6 members with the average number of 3.9, and the total APs amounts to 243. The specific result of this survey is shown in Table 2.4.

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Table 2.4 The Size of the Families Interviewed

No. of Members Frequency (household) Percentage (%) （persons） 1 1 1.6 Item 2 3 4.8 description 3 16 26 4 27 43.5 5 10 16.1 6 5 8 Total 62 100

Time of Living in the village

The survey indicates that most of the people have been living in the village for a long time, and the details are shown in Table 2.5. Table 2.5 Living Duration in the village

No. of cases Residence time Percentage of cases (%) （household） Five years and below 0 0 5～10 years 0 0 10～20 years 0 0 20～30 years 0 0 30～50 years 7 11 For generations 55 89 Total 62 100

2.4.3 Average annual family income and expenditure per household

As shown in the statistics on 62 households in survey, their annual family income is CNY 0.814 million among which agricultural income is CNY0.18 million (22.11%) and nonagricultural income is CNY 0.634 million (77.89%).

For expenditure, their total annual family expenditure amounts to CNY0.607 million, among which CNY0.223 million is paid for production, accounting for 36.74%, and CNY0.384 million is for daily consumption, accounting for 63.26%. The income and expenditure structure is shown in Table 2.6.

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Table 2.6 Annual Income and Expenditure Structure of the Families Interviewed

Per capita Total income Item Income (10,000 yuan) (yuan/person) Planting industry 18.0 818.2 Aquaculture 3.5 159.1 Forestry 0.8 35.5 Annual family Wages 42.0 1909.1 income Private business 14.0 636.4 Others 3.1 141.8 Total 81.4 3700.1 Family operating expenditure 13.7 620.5 Taxes and other expenses 1.3 57.7 Purchase for productive fixed assets 2.3 104.5 Annual family Daily life 36.6 1662.7 expenditure Properties 0.1 6.0 Transfer expenditure 2.2 98.5 Total 56.1 2550.0 Annual savings 25.3 1150.0

Since the village is close to the urban area, and contained in the construction area in the urban planning, most households earn considerable nonagricultural income.

2.4.4 Minority Families and Vulnerable Groups

As for the survey on 62 households, all are of Han nationality without ethnic minority nationality families. Among the families interviewed, neither female-household family nor widow/orphan family was found. Also, none of the affected households were poverty households.

2.4.5 Willingness of Compensation for Land Acquisition

This project does not involve any house demolition and relocation. Regarding land acquisition, the interviewed farming households’ reply to the compensation method for permanent land acquisition in survey is summarized in Table 2.7.

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Table 2.7 Willingness of Compensation for Land Acquisition

Project title Options Cases(person) Percentage (%) Cash compensation 23 37.11 Farmland with same size and quality 30 48.4 Employment arrangement for family 1 1.6 Farmland members compensation Not available 4 6.5 Do not know 4 6.5 Total 62 100.0

2.4.6 Willingness to obtain training

Many affected laborers wish they could get retraining for reemployment, which is shown in Table 2.8. In fact, 70% people in survey indicated “willing”, 9.94% were unsettled, and 10% did not reply. However, if there were good employment opportunities, they would change their opinions; this can be seen in Table 2.8 for specifics.

Table 2.8 Affected Laborers’ Willingness to Obtain Reemployment Training

Reply Respondent (person) Responding rate (％)

Yes 154 70 No 0 0 Unsettled 44 20 No reply 22 10 Total 220 100

Information about the Project and Land Acquisition

See Table 2.9 for the social survey result concerning the affected people’s knowledge on the project and land acquisition.

As reflected from Table 2.9, 80% of the APs came to know the project within nearly half a year; 50% in survey only learnt their land acquisition 2 months in advance mainly from the project social investigators, accounting for 40%, 30% learnt the message from their neighbors and 10% from the newspaper, and 20% from the meeting assembly.

As indicated from the survey result, a more effective and strong publication procedure is needed and mass media shall also display their functions in boosting the affected community

17 and people learning the information concerning this project and other land acquisition-related information. Table 2.9 Information Sources and Time Concerning the Project and Land Acquisition

First knowledge

2.4.7 Understanding and Attitudes

The APs hold positive attitude towards fair compensation corresponding to their losses, and actually, 90% of them believed reasonable compensation; and 10% doubted. 80% respondents believed the relevant departments in charge would assist in them, 20% were not sure. When questioned about whether their families would benefit from this project, 70% respondents said” yes”, 10% said “no”, and 20% indicated uncertain. The APs give support to the project overwhelmingly, as 93％ agree, 2% not care and 5% not sure. The survey result is shown in Table 2.10. Table 2-10 Affected Persons’ Attitude and Opinion Towards the Project

Questions Reply (%) Yes No Not sure Would you family benefit from this project? 70 10 20 Yes No Not sure Would your losses be fairly compensated? 90 0 10 In addition to reasonable compensation, will the Yes No Not sure relevant departments in charge help you? 80 0 20 Not Not Yes No Do you agree and support this project? care certain 93 0 2 5

18 3. Project Impacts

3.1 Types of loss Caused by Land Acquisition

According to the detailed design and field survey for the project, the types of losses caused by land acquisition and resettlement are shown as follows:

• Permanent arable land acquisition; • Temporary land use; • Infrastructure and facilities demolition; and • Loss of other productive assets such as trees and standing crops.

3.2 Measures to Minimize Land Acquisition

3.2.1 Measures to minimize land acquisition during project design

In terms of land acquisition, resettlement and /or damage incurred, the following measures have already been applied in the project designing to reduce losses arising from project construction.

In the planning and design phase, the design unit and the owners of the project have proposed the following two schemes for plant site to reduce the Project’s influence on the local social economy z Scheme 1: to locate in the west of county seat, northeast side of Zhengxing Road and west bank of Tianran Channel. z Scheme 2: to locate in the northeast of county seat, northeast crossing corner of Xinchang Road and Xingfu Road, and east side of Wenyan Channel. Comparative selection of the two schemes: The foregoing two schemes can get match with the requisition of wastewater treatment plant site selection in perspective of technique and both of them experience good traffic, environment, electricity and drainage. Now the two schemes are to be compared with each other.

Scheme 1: Advantages: locating in the northeast of Zhengxing Road experiences quite convenient traffic. The plant site would occupy basic farmland with good development conditions in long-term; locating in the west bank of Tianran Channel provides good drainage condition and short convenient pipelines for electricity and water supply; locating in the middle area of the county seat from south to north is convenient to collect urban wastewater, and for short main pipeline the wastewater can be ensured to flow to the wastewater treatment plant by gravity. Disadvantages: the plant site locates in the middle of the county seat from south to north instead of in the lower reaches of the county seat.

Scheme 2: Advantages: locating in the northeast of the county seat and northeast crossing corner of Xinchang Highway and Xingfu Road, the plant site would occupy basic farmland with good development conditions in long-term; locating in the west side of Wenyan Channel, its drainage condition is quite good. Disadvantages: locating in the northeast corner of the county seat needs to install much longer branch pipeline; the wastewater cannot flow to the treatment plant very naturally, needing pumping in the middle way to ensure that it flow to the treatment plant and thus it will increase investment cost of the project and operation cost; lines for electricity and water supply are quite longer. 19 To sum up, the two schemes have their own advantages and disadvantages respectively. However, scheme 1 has much more advantages than scheme 2 with fewer disadvantages and therefore scheme 1 has been chosen. To minimize the project impact on local social economy, the project design institute and project owners took some effective measures: 1. During project planning phase, project impact on local social economy, taken as a key factor for selecting schemes, was taken into account as much as possible while comparatively selecting the schemes. 2. The selected plant site avoided villages and facilities for commerce, finance, cultural entertainment, and avoided demolishing houses and expropriating arable land with quite good irrigation conditions and then ultimately it is determined to be constructed in the west part of the county seat planning area. 3. Optimizing organization and design for construction to shorten project duration and properly arranging the time periods for house demolition, construction and completion. 3.2.2 Measures to Minimize Land Acquisition and Resettlement augmented in Construction Stage

ⅰ) Enhancing public participation mechanism

Before the commencement of project construction, such information related to project starting time and project construction schedule was made to public in form of bulletin and measures of land acquisition and resettlement was announced for purpose of accepting the residences’ supervision; during construction, preferential consideration will be given to utilize the local materials, transportation and labor force, such that the affected people could benefit from the project construction.

ⅱ) Strengthening construction and management, reasonably arranging the construction site, minimizing influences on crops and plants, strictly controlling noises, dusts and influences on surrounding environment.

ⅲ) Accelerating implementation progress, reducing construction influences, adopting advanced methods especially by using the mechanized construction in sewage network to shorten the construction time and to minimize the adverse impacts.

3.3 Project Impacts 3.3.1 Survey Methods

To make clear the loss of land acquisition, to provide reliable basis for the resettlement plan of APs and for the drawing up of budgetary estimate, Fengqiu Construction Bureau has carried out survey on the affected area in August 2004 and another survey in March to mid April 2006 which included: the survey of land requisition, of the population affected by the project, of the scattered trees, of special facilities, etc. Its specific methods of investigation are as follows: (1) Census. The census of the households affected by the land requisition can be done separately according to the following types, namely, the households whose land will be expropriated entirely and those whose land will be expropriated partially. (2) Land survey. Identify the present user(s) of the land, to measure the land piece by piece on the spot, and to investigate and add up the area according to the different uses and occupants/owners. (3) The survey on scattered trees and graves. To verify item by item and one by one for the scattered trees and cemeteries in the scope of land requisition, and to register them according to their different species.

20

3.3.2 Summary of Project Impacts

ⅰ）Permanent land acquisition

The wastewater treatment plant for this project needs permanent land acquisition, involving Xinzhuang village of Chengguan town, with total collective land (paddy field) of 49.93mu, which will directly affect 20 farmers, with total 95 people. As the plant is planned to be laid along the Zhenxing road, it is not needed to build entrance road and bridge. Therefore land acquisition and resettlement can be avoided. Detailed conditions are shown in Table 3.1.

Table 3.1 Categories and Quantities of the Land Permanently

Farmland to be permanently Affected Affected acquired (mu) Items Village household person Non-arable Arable land Total land Xinzhuang Plant 20 95 49.93 0 49.93 village ii）Temporary land use

The temporary construction land refers to the land temporarily borrowed during construction phase, including sand and stone materials plant, mixture plant, productive and living areas in construction phase and temporarily occupied road. And all of the land temporarily occupied for the plant is chosen within the permanently acquired land scope, which doesn’t need borrow other land. For the construction phase of pipeline network, it will temporarily occupy roads, amounting to 445mu of state land.

Table 3.2 Profile of the Farmland Temporarily Affected by the Pipeline Network

Temporary land (mu) No. Items Total municipal administrative roads Wastewater 1 0 0 Treatment Plant 2 Sewage 445 445

Total 445 445

iii) Infrastructure and facilities Since the plant construction is within the land permanently expropriated, there is no impact on the infrastructure. However because of underground work of pipeline construction, it will impact road facilities, including 30m2 concrete, 20.69km main road (sub-main road) and 35.48km pavement. All of them are state owned land and no land compensation is required; however, the cost of restoring the road will be negotiated with and managed by the urban construction agency; this cost is included in the civil works cost.

21

Table 3.3 Types and Quantity of Infrastructures and Facilities

Facilities

No. Item Asphalt Pavement road (m2) (m2) Sewage 1 75392 42124 pipelines

3.3.1 Cultural Relics and Vulnerable Groups The project has no impact on cultural relics. Among the 20 households affected by land acquisition, neither minority nor vulnerable groups are identified.

3.3.2 Public Concerns

Survey on project demand and feedback of the affected people has been made, satisfying the affected people’s demands. Problems concerned are environmental protection, employment and enterprising opportunities. What they concern about: i) fair compensation; ii) regulating adequate land; iii) assistance to livelihood; and iv) timely and adequate compensation.

3.4 Project Impact Analysis The impact of the land acquisition which is managed by village is in Table 3.4.

Table 3.4 Analysis on Permanent Land Acquisition

Per capita Per capita Per farmland Land farmland Land Name of Name of Household population Farmland household before acquisition after land loss Project village (per) (mu) farmland land (mu) acquisition (％) (mu/h) acquisition (mu／p) (mu／p)

Wastewater Xinzhuang treatment 280 1080 750 2.68 49.93 0.7 0.65 7% village plant Affected 20 95 54.0 2.70 49.93 0.7 0.04 92% Households

Due to the construction of this project, the original production system in the areas of Xinzhuang village in Chengguan Town has been damaged, which causes limited impacts on the local agricultural production. After analysis of survey after land acquisition, the affected Xinzhuang will not readjust arable land but instead will pay land compensation to the people who use the land. Therefore, it has much impact on the 20 families whose land is occupied mostly. Since

22 the village locates in the middle area leaning to east, many people have entered the urban area working in individual business and more than 70% of the farmers work in the secondary and tertiary industries. They wouldn’t like to cultivate land. Even some families do not have time or energy to cultivate land but hire others to do so with payment and thus they prefer to get compensation for land acquisition but they still want some land as insurance. In addition, the land acquisition rates have increased recently, which provides good profit for farmers to generate more income or working in secondary and tertiary industries. In the way of resettlement, the Project will provide assistance in policy, technique, finance and material to restore or exceed the original living standard of the farmers whose land is expropriated.

While constructing wastewater pipeline network, efforts will be made to try to avoid the business hours of the stores and the traffic peak. Constructing the project at night in the suburb areas is to accelerate the progress of the project.

4. Legal and Policy Framework

Legal and law framework for this project has two sets of sources: PRC’s laws and regulations and policy requirements of ADB. This chapter is aimed to describe demolition and resettlement policies and strategy concerning land acquisition and compensation.

4.1 The Main Law and Policy of Resettlement Foundations

4.1.1 Legal framework

Compensation to the affected people and land and resettlement adheres to the Land Administrative Law initiated in 1999, involving land access and ownership, land use and protection and compensation, resettlement subsidy and proper resettlement measures to the affected people. According to the Land Administrative Law (Article 8), rural land belongs to the state land, rural and suburb land is owned collectively by village (residential land, arable land and mountain regions). Such collective and its members (majority of two thirds) have the right to determine whether reallocate or rearrange the arable land (Article 31). Furthermore (Article 47) it elaborates when land acquisition is necessary, compensation shall be made as per the original land purpose containing land compensation, resettlement subsidy, compensation for land attachment and standing crops.

Arable land compensation shall be multiple of average annual output of 3 years preceding such acquisition (based on local standard as prescribed by law). Likewise, the resettlement subsidy for each agricultural population to be settled shall be calculated based on multiple of the average annual output of 3 years preceding the land acquisition. Compensation for standing crops shall be calculated as per one season output. Compensation method and standard for the attachments will be carried out pursuant to regulations of Henan Provincial People’s Government. Augmenting attachments after at the date of announcement release for land acquisition will not be compensated. Articles 48 and 49 require consultation on the compensation standard and the compensation to be paid to the collective owner. All the compensations will be paid to the land owners including agency or collective organization.

Arable land occupancy tax will be calculated according to actual land area tax payers occupied which will be collected at once based on the specified amounts.

As regards to the specific implementation principle, compensation eligibility, deadline, procedures of information publicity, resettlement plans and monitoring have been specified. During urban building demolition, specialized state policy and local regulations will be in charge of the 23 management, demolition, compensation and resettlement. The laws and regulations used for the project are shown as follows:

z Land Administration Law of the PRC; z Methods of Land Acquisition Announcement by Land Resources Administration, put into force on January 1, 2002; z Henan Provincial Management Guidelines for Implementation of the Land Administration Law of PRC, 1999; z Document 28: State Council Decision to Deepen Reform and Strictly Enforce Land Administration, issued October 2004; z Urban House Demolition Management Regulation of PRC, put into force on January 1, 2001; and z Urban House Demolition Management Regulations of Henan Province, put into force on December 1, 2002.

4.1.2 Relevant Legal Extracts Relevant regulations of Land Administrative Law of PRC:

Article 10 land collectively owned by peasants will be organized legally by the collective economic committee; peasant collective-owned land respectively owned by more than two villages will be managed by the rural collective institutes of village or farmer teams; collective land subordinated to village (town) farmers will be managed and administrated by village (town) collective economic forms.

Article 14 Land owned by farmer collectives shall be operated under a contract by members of the economic organizations of the farmer collectives for crop cultivation, forestry, animal husbandry or fishery. Within the duration of the contract for operation of land, any appropriate readjustment of the land between individual contractors shall be made with the agreement of at least two-thirds of the members of the villagers assembly or of the representatives of villagers and submitted to the township (town) people's government and the agriculture administration department of the people's government of the county for approval.

Article 24 National protective arable land is forbidden to be changed into non-arable land. Land occupancy compensation policy is implemented by nation. In case land is approved for non-agricultural construction, the principle of “ cultivating according to occupation” must be observed; non-observance cultivation or cultivated land not conforming to the requirements, land cultivation fees shall be paid as per the regulations as specified by province, autonomous or municipal level.

Article 31 Land damage caused by digging, sinking and occupying shall be restored in charged by relevant regulations of the nation; non-restoration or non-observance shall be subjected to land recovery expenses.

Article 42 Land acquired shall be compensated for on the basis of its original purpose of use.

Compensation for acquired cultivated land shall include compensation for land, resettlement subsidies and attachments and standing crop crops on the acquired land. Compensation for acquisition of cultivated land shall be six to ten times the AAOV of the acquired land for three years preceding such acquisition. Resettlement subsidies for acquisition of cultivated land shall be calculated according to the agricultural population to be resettled. The agricultural population to be resettled shall be calculated by dividing the amount of acquired cultivated land 24 by the average amount of the original cultivated land per person of the unit the land of which is acquired. The standard resettlement subsidies to be divided among members of the agricultural population needing resettlement shall be four to six times the AAOV of the acquired cultivated land for three years preceding such acquisition. However, the highest resettlement subsidies for each hectare of the acquired cultivated land shall not exceed fifteen times its AAOV for the three years preceding such acquisition.

Standards of land compensation and resettlement subsidies for acquisition of other types of land shall be prescribed by provinces, autonomous regions and municipalities directly under the Central Government with reference to the standards of compensation and resettlement subsidies for acquisition of cultivated land.

Standards for compensation for attachments and standing crop crops on the acquired land shall be prescribed by provinces, autonomous regions and municipalities directly under the Central Government.

For acquisition of vegetable plots in city suburbs, the land users shall pay towards a development and construction fund for new vegetable plots in accordance with the relevant regulations of the State.

If land compensation and resettlement subsidies paid in accordance with the provisions of the second paragraph of this Article are still insufficient to help the farmers needing resettlement to maintain their original living standards, the resettlement subsidies may be increased upon approval by people's governments of provinces, autonomous regions and municipalities directly under the Central Government. However, the total land compensation and resettlement subsidies shall not exceed 30 times the AAOV of the acquired land for the three years preceding such acquisition.

Article 47 After deciding on the policy of land acquisition compensation, announcement shall be issued by relevant local government and opinions of the collective farmers and local organizations shall be listened.

Article 48 The rural collective economic organization, the land of which is acquired, shall accept supervision by making known to its members the income and expenses of the compensation received for land acquisition.

The compensation and other charges paid to the unit for its land acquired is forbidden to be embezzled or misappropriated.

Article 49 Local people's governments at all levels shall support the rural collective economic organizations, the land of which is acquired, and the farmers in their efforts to engage in development or business operation or to start enterprises.

Article 50 State-owned land used by the construction unit shall be obtained by such compensable attitude as selling; however, the following types of construction land as approved by the people’s government above county level can be obtained by appropriation”: (I) National governmental organization land use (II) Urban infrastructure land and public welfare land (III) Infrastructure construction land primarily supported by the nation related to energy, transportation and water conservancy works, and (IV) Land of other purposes as specified by law or administrative regulations

Article 54 Where land owned by the State or by farmer collectives needs to be used temporarily

25 for construction of projects or for geologic prospecting, the matter should be subject to approval by the land administration departments of people's governments at or above the county level. However, if the land to be temporarily used is located in the area covered by urban planning, the matter shall be subject to agreement by the urban planning administration department concerned before it is submitted for approval. The land user shall, depending on who owns the land and who has the land-use right, enter into a contract for the temporary use of the land with the land administration department concerned, or the rural collective economic organization, or the villagers committee and pay compensation for it in accordance with the provisions of the contract.

Article 57 In case that the following conditions are met, and subject to approval of the people’s government or government with approval right, national land use right may be retrieved: (I) land use for public interest; (II)when land needs to be regulated arising from old city reconstruction for implementation of urban planning.

Article 58 Rural peasants can only own one residence for each household, with the area not exceeding the standard for province, autonomous region and municipalities. Rural residences shall meet the overall planning of town land utilization and maintain the original residing base and village spare area. Rural residing land shall be inspected by town people’s government and approved by country-level government; in which, where farmer-used land is occupied; procedures shall be addressed according to Article XXXXIV of this law.

2）Relevant Stipulates of Provisional Regulations of Farmland Land Occupancy Tax in PRC, 1987

Article 2 The farmland referred in the regulations means the land for planting. And that for planting 3 years preceding the acquisition is regarded as the farmland as well.

Article 3 Both unit and individual who need to occupy farmland for building construction or other nonagricultural construction should be responsible to pay farmland occupancy tax (thereafter called taxpayer). They should pay farmland occupancy tax in accordance with the regulation.

Article 4 Farmland occupancy tax should be calculated based on the actual area of farmland occupation. The amount of tax should be collected payment once. Article 5 The tax amount of farmland occupancy should be stipulated as follows: (1) Take a county as a unit (same thereafter), for the area that the average farmland area is less than one mu per capita(included), the tax should be CNY 2 to CNY 10 per square meter; (2) For the area that the average farmland ranges from one (1included) to two (2 included) mu per capita, the tax should be CNY 1.6 to CNY 8 per square meter; (3) For the area that the average farmland ranges from 2 to 3 mu per capita, the tax should be CNY 1.3 to CNY 6.5 per square meter; and (4) For the area that the average farmland is more than 3 mu per capita, the tax should be CNY 1 to CNY 5 per square meter.

Article 9 The farmland occupancy tax should be collected by finance department. The land administrative bureau should inform all finance departments timely after approval of land occupation for unit and individual. The unit and individual should declare and pay tax to finance department with the document approved by land administration bureau above county level. The land administrative bureau will transfer the land to unit and individual based on the receipt of tax payment or approval document for land acquisition.

26 3）Relevant Regulations on the State Council Decision to Deepen Reform and Restrict Land Administration

Implications of new regulations for land use and land compensation “Document (28) 2004” - a State Council Circular on the “Decision to Deepen Reform and Strictly Enforce Land Administration” was issued on 21st October 2004 and contains several very important provisions in respect of LAR activity. The document points out that “the relationship between ensuring socio-economic development and protecting land resources must be correctly addressed” with the stated objectives “to bring the growth of land for construction use under strict control, take efforts to activate land reserves, strengthen (the awareness of) land saving, deepen reform, improve the legal system, take overall arrangements into consideration and further improve the strictest land system that is in tally with the national conditions of the country”.

The document urges local governments to take action to, inter alia:

▪ Strengthen land use planning and utilize approved land use plans as the basis for approving proposed construction projects.

▪ Involve local land use departments in the approval process for construction projects ▪ Publicize minimum values for sale and transfer land to avoid land acquisition taking place at below market rates ▪ Strengthen the application of “no detriment” for affected persons ▪ Ensure compensation payments are targeted to those most affected by LAR activity ▪ Strengthen audit and monitoring arrangements

The issue of document 28 was followed up by:

(i) The issue (on 1st November 2004) of Decree 27 by the Ministry of Land Resources. Decree 27 contains administrative procedures for use by local Land Use departments in reviewing proposed construction projects. These procedures attempt to strengthen land use planning and control.

(ii) Ministry of Land Resources “Guidelines on Improving the System of Land Acquisition Compensation and Resettlement” which was issued on 3rd November 2004, makes specific reference to Document 28 and gives specific guidance on its implementation.

4）Guidelines for the Implementation of the Land Administrative Law of PRC in Henan Province

Article 25 Where non-agricultural construction project is approved for land occupancy, cultivation plans shall be made by land users, forwarding to land administrative department for approval responsible for cultivation the land quantity and quality as appropriate. Where there’s not proper condition for land cultivation, corresponding cultivation fees shall be paid and the cultivation fees collection, utilization and management method shall be otherwise specified by provincial people’s government. Where land is supplied in unified manner within urban construction land occupancy under overall land planning, arable cultivation shall be shouldered by land use unit; where arable land is occupied by village and towns, land cultivation shall be taken charge by rural collective organizations or village committee.

Article 24 For acquiring farmer’s collective land, compensation should be made as follows: (1) Land compensation: compensation for acquired cultivated land in the outskirt of primary city shall be eight (8) to ten (10) times the AAOV of the acquired land for three years preceding such acquisition; in the outskirt of secondary city and mining area seven (7) 27 to nine (9) times the AAOV; in other areas six (6) to eight (8) times the AAOV. Of the farmland acquisition, various sideline products (excluding vegetable) shall be counted as 15% to 20% of the annual production based on major products.(AAOV: arable land averaged output value)

(2) Resettlement subsidies: for acquisition of cultivated land, compensation shall be paid based on each 667 m2: For the average farmland per capita is over 667 m2, compensation shall be four (4) to five (5) times the AAOV of the acquired cultivated land for three years preceding such acquisition; for the average farmland per capita is over 334 m2 and under 667 m2, compensation shall be six (6) to nine (9) times the AAOV of last three years; for the average farmland per capita is less than 334 m2, compensation shall be ten (10) to twelve (12) times the AAOV of last three years. Under special circumstance, compensation shall not be over 15 times the AAOV of the acquired cultivated land for last three years preceding such acquisition of 667 m2.

(3) Standing crops: one times the AAOV.

(4) Compensation standards for attachments shall be executed according to the regulation of Provincial People’s Government. No compensation shall be paid to the newly added attachments from the date of public notification.

Article 35 in case the land occupied belong to rural collective owners or village committee, land compensation shall be paid to rural collective owners or village committee; where it belongs to villagers team; compensation shall be paid to the team and where it belongs to town collective organizers, it shall be paid to the organizers. Compensation for land attachment and green crops subsidy shall be performed as per Article 26 of Promulgation Rules for Land Administrative Law.

Article 38 The annual production value for land compensation and resettlement subsidies shall be based on the average annual production and current average nation-regulated product price of last three years. If no nation-regulated price, the local market price shall be used.

Article 39 Within the area of land acquisition, if there is water source, culvert, culvert gate, pipeline, road, electric cable and production and living related facilities, the local People’s Government shall organize relevant departments as well as the land use unit and construction unit to resettle properly, without obstruction and damage on purpose; if obstruction and damage can not be avoided, the items shall be rehabilitated or constructed relevant facilities according to regulations.

Article 40 Temporary land use shall be implemented according to Article 57 of Land Administrative Law. Expiration of temporary land shall subject it to original status and land returned.

5) Relevant regulations of compensation standards for land acquisition for national construction in Xinxiang City

(1) Compensation standard of AAOV for Grain Land

28

Table 4.1 Compensation Standard of AAOV Ground Compartmentalize standard AAOV（yuan/mu） rank Excellent soil quality, entirely irrigation and Grade 1 1250 drainage, smooth and regular plot, fertile ground Excellent soil quality, better condition on irrigation Grade 2 and drainage, smooth and regular plot, fertile 1005 ground Good soil quality, possess of irrigation and Grade 3 890 drainage, smooth plot, good fertilizer usage

(2) Standing crops in land acquisition are compensated by one times the AAOV, and followed by the confirmed schedule of expropriation. The standard constitutes of 60% of AAOV in summertime and 40% of AAOV in autumn time. In addition, the autumn time is from 10th June to 30th September each year when the rest is summertime.

(3) Compensation standard for economic standing crops shall be executed according to the one of temporary land use. (4) During the stage from expropriation starting to approved, it won’t according to the span season compensation standard when consulting to expropriation and calculating the attachments instead of start working and temporary land use. But it shall be compensated when carrying out the expropriation and the standing crops demolition for the reason of measuring, fixing stake and reconnaissance, especially keep a principle combined by the reality and the circumstances. In terms to avoid unnecessary loss by the miss farming, the land administrations should concerns the starting and construct cycle of the expropriation and give a notice to farmer when the cycle is long and span the season.

4.2 ADB Policy on Involuntary resettlement 4.2.1 Overall Objective of ADB Involuntary Resettlement Policy

The Asian Development Bank sets out its official requirements in the Involuntary Resettlement Policy adopted in 1995. The principles of the ADB’s Policy on Involuntary Resettlement are as follows:

(i) Involuntary resettlement should be avoided where feasible. (ii) When population displacement is unavoidable, it should be minimized by exploring all viable project options. (iii) If individuals or a community must lose their land, means of livelihood, social support systems, or way of life in order that a project might proceed, they should be compensated and assisted so that their economic and social future will generally be at least as favorable with the project as without it. Appropriate land, housing, infrastructure, and other compensation, comparable to the without project situation, should be provided to the adversely affected population, including indigenous groups, ethnic minorities, and pastoralists who may have usufruct or customary rights to the land or other resources taken for the project. (iv) Any involuntary resettlement should, as far as possible, be conceived and executed as a part of a development project or program and resettlement plans should be prepared with 29 appropriate timebound actions and budgets. Resettlers should be provided sufficient resources and opportunities to re-establish their homes and livelihoods as soon as possible. (v) The affected people should be fully informed and closely consulted on resettlement and compensation options. Where adversely affected people are particularly vulnerable, resettlement and compensation decisions should be preceded by a social preparation phase to build up the capacity of the vulnerable people to deal with the issues. (vi) Appropriate patterns of social organization should be promoted, and existing social and cultural institutions of resettlers and their hosts should be supported and used to the greatest extent possible. Resettlers should be integrated economically and socially into host communities so that adverse impacts on host communities are minimized. One of the effective ways of achieving this integration may be by extending development benefits to host communities. (vii) The absence of formal legal title to land by some affected groups should not be a bar to compensation. Affected persons entitled to compensation and rehabilitation should be identified and recorded as early as possible, preferably at the project identification stage, in order to prevent an influx of illegal encroachers, squatters, and other non-residents who wish to take advantage of such benefits. Particular attention should be paid to the needs of the poorest households and other vulnerable groups, such as indigenous peoples, and appropriate assistance provided to help them improve their status. (viii) The full costs of resettlement and compensation, including the costs of social preparation and livelihood program as well as the incremental benefits over the “without project” situation, should be included in the presentation of project costs and benefits.

4.2.2 Resettlement Plan Preparation

According to the Bank policy, the contents and level of detail of a resettlement plan, which may vary with circumstances, especially the magnitude of resettlement, should normally include a statement of objectives, policies and strategy, and should cover the following essential elements: i) Corresponding measures shall be taken for resettlement within the policy framework making sure that the affected people have their optional right and other rights concerning the resettlement; familiar with the feasible schemes technologically and economically, participating in negotiation and enjoying opportunity of selection; obtaining compensation rapidly and duly based on the resettlement costs to mitigate the direct financial loss caused by project. ii) In case resettlement is involved, corresponding measures shall be taken in line with resettlement planning or resettlement schedule, guaranteeing the affected people could get subsidy (such as resettlement subsidy); obtaining house or housing base, or farming site according to their requests. The production potential, positioning advantages and other comprehensive factors shall at least correspond with the advantageous conditions of the original site. And iii) To achieve the objectives of this policy, necessary measures shall be taken regarding the policy frame for resettlement plans resettlement to ensure during the transitional period as expected reasonably the affected people could get proper assistance and subsidy in accordance with the livelihood and living standard restoration.

4.3 Resettlement Objectives and Planning Principles

4.3.1 Resettlement target

Compensation and resettlement policy to the affected people are formed based on China State laws and regulations as well as requirements from Asian development Bank. The purpose of 30 the resettlement and rehabilitation plan is to ensure that the affected people will regain or surpass their living standards after the resettlement. Priority shall be given to poverty-stricken people and vulnerable groups.

4.3.2 Resettlement planning principles

Requirements both from China State laws and Asian Development Bank are reflected in the Resettlement principles provided in Table 4.2 are principles involving compensation, dismantling and income rehabilitation; which are adequately flexible: allowing differences between villages, and urban communities; the differences are embodied on the one hand between land redistribution and cash payment; and on the other hand, the income rehabilitation of individual income based on community. The key lies in guaranteeing all affected people could get assistance and compensation for income rehabilitation after resettlement.

Table 4.2 Abstract of Resettlement Principles

Principles

Compensation and entitlement provided to the affected people should maintain their living 1 standard at least no worse than ever “without project”, or better.

All the affected people, legally entitled or non-entitled, should be compensated and assisted 2 for resettlement. Compensation by cash should ensure the standard of living of the affected people can be 3 maintained at least no worse than ever after resettlement. In case livelihood fails to be maintained after land acquisition, cash compensation or kind 4 compensation for land loss should be made thereto. Other income generation activities should all be carried out. The affected people should have full understanding of such items as eligibility, 5 compensation modes and rate, livelihood and income rehabilitation as well as the project implementation schedule, and participate in the implementation of the resettlement plan. Land acquisition should not be carried out until the affected people are satisfied with 6 compensation and resettlement and their schemes. Compensation and resettlement would be monitored by the executive agency or the third 7 party. Special assistance or treatment should be given to the vulnerable groups to ensure they 8 have a better life.

9 The affected people should have opportunities to get profits from the project. Demolition and resettlement plans should be identical with the overall plan for Xinxiang. 10

4.4 Compensation Rate

4.4.1 Compensation Principle

z Compensation rate should be determined according to replacement principle. z Compensations shall be paid before acquisition of land and property. 31 z Where the enterprises and shops cease their operation incurred by project construction, loss compensation shall be given till operation recovery and the compensation rate will be determined in line with the average wage level paid by the enterprises or shops as well as averaged profits and actual operation stopping duration. z Construction management shall be consolidated to shorten the down time for enterprises and shops affected. z Land compensation rate and resettlement subsidy for land acquisition shall be executed in compliance with Henan Land Administrative Regulations and Administrative Method for Land Examination and Approval and Houses Demolition Compensation for Public Welfare Construction of Xinxiang. z The attachments involving standing crops and trees shall be compensated to the contractors or proprietors in line with the policy regulations.

4.4.2 Compensation Rates for Land Acquisition and Resettlement

1） Compensation Rate for Permanent Land Acquisition According to the survey and measurement, the average productivity of the affected farmland in last three years was evaluated as 1300 yuan per mu. See Table 4.3 and Table 4.4.

Table 4.3 Compensation Rates Calculation for Permanent Land Acquisition

AAOV in last 3 Compensation Multiplier Standard of compensation (yuan/mu)

Item years Land Resettlement Standing Land Resettlement Standing Total (CNY/mu/year) Compensation Subsidy crops Compensation Subsidy crops

Farm 1300 10 10 0.5 13000 13000 650 26650 land

Table 4.4 Compensation Rates for Permanent Land Acquisition Unit: Yuan/mu Land User fee for Type of Compensation land Tax on Land Standing Land land and occupation Farmland Management Total crops Cultivation acquired Resettlement for new Acquisition Fee Subsidy construction

Farmland 26000 650 5625 4467 3000 694 40436

Village Land Receiver Contractor Land bureau nation Land bureau commission bureau

2） Compensation Rate for Temporary land use

32

Table 4.5 Compensation Rate for Temporary Land Use

Unit: Yuan/m2

Facilities

No. Item Asphalt road Pavement

Sewage 1 80 30 pipelines

4.4.3 Cut-off Date The qualifying deadline for compensation was decided in July 2005. Any newly built structures or planted trees after this date purely for getting extra compensation not taken into account.

4.4.4 Payment of Compensation

The compensation for the land acquisition and other attachment should be directly paid to the legal owners of the property.

Compensation for land acquisition and resettlement paid by the IAs has been distributed to the owner or user of the land directly before land acquisition. According to the Land Administrative Law of People’s Republic of China, the compensation for land loss has been handed to the former owners and users of the land before the land acquisition, while the resettlement subsidies had been put in the aim for relocating the farmers. Therefore, the collective land compensation has been handed to the collective economic entity （village committee） who owns the lands or their affected villagers’ team; the resettlement subsidies had been handed to village committee or villagers’ team for the resettlement of farmers. The village committee decided to hand the total fund amount of CNY26.65 million to the villagers while the group retained nothing.

4.4.5 Procedures for Compensation Payment

Figure 4.1 below shows the process and supervision of the compensation fund payment. The Compensation for land acquisition, demolition and resettlement has been paid to Fengqiu County Land Bureau by the IAs using a special bank account. Fengqiu County Land Bureau then distributed the compensation to affected village committee and land owners. Village Committee disbursed the land compensation fund to the affected persons based on their contract use rights during fund distribution in 2004 and each payment was registered. County Government monitored and audited the disbursement and use of the fund, assessed and evaluated the effect of the fund use and give necessary instruction to scan for fraud.

33

Figure 4.1 Compensation Payment Procedures for Permanent Land Acquisition

Fengqiu County WWTP

Fengqiu Land & Resources Bureau

Affected Village Affected Owners Committee of Other Property

Affected Farmers

4.4.6 Eligibility and Entitlement for Compensation

All the APs have got compensation for loss of their property due to its reconstruction value. According to the compensation rules, entitlement and eligibility, a resettlement entitlement matrix table (Table 4.6) was formulated to guide resettlement implementation, which includes losses of various types and covering measures, regulations and standards as provided in this chapter and other chapters.

34

Table 4.6 Entitlement Matrix

Types of Causes for unit or Quantity of unit or individual Compensation policy Compensation detail Implementation procedure Losses occupation or individual who has entitlement loss who has entitlement

Villager representative meeting · obtain CNY26000/mu as compensation for land studies and determines the loss and resettlement subsidy; relevant issues on fund allocation and allocating Current arable ·adequate compensation to methods of compensation fund, timely and adequate land is collective economic Village Xinzhuang village of compensation allocation to the expropriated organizations and farmers and committee, Chengguan town, affected 20 farmers who have lost because of the common parts are farmers households with 95 persons. productive materials since land WWTP · determined by villager utilize land compensation and resettlement subsidy acquisition; the solution construction representative meeting to restore all APs’ income program to the grievance and feedback about compensation fund from villagers and then Permanent take it into practice. land acquisition

·obtain training and employment opportunities and ·WAG, district government, take measures to maintain their business income village committee organize skills training to strengthen laborers’ Loss of knowledge and knowledge productive 20 households ·compensate the labor force for ·village committee pays materials Farmers with 95 villagers because of land loss of land acquisition compensation fund at the end of each year acquisition · the farmers whose land is expropriated should get ·formulate favor measures for · compensation at the rate of CNY650/mu year. laborers’ own business engagement

Temporary Usual production Owner of Urban Construction Bureau · land use and business is roads ·construction agency takes charge affected since construction of of the road recovery. sewage Business Various businesses along ·if business are disrupted and suffer loss of ·Negotiated with contractors · Contractors will take treatment owner roads business, they will be compensated for lost revenue, under IA supervision measures to avoid or minimize pipeline network profits and wages disturbances

35

5 Compensation and Rehabilitation Measures

5.1 Resettlement Strategy

5.1.1 Resettlement Objective The general objective of this RP is to ensure that: the affected person (AP) will be compensated for their land loss and will improve their living standards or at least not be worse off than the current level. Based on the features of economic development and employment of the affected village, with integrated analysis the resettlement objectives are determined as follows: i) Develop the Second and Tertiary Industry and increase APs’ income; and ii) Actively take economic rehabilitation measures to ensure AP regain or surpass their living standards after the resettlement.

5.1.2 Rehabilitation Planning Principles Based on the relevant state regulations & rules and the ADB involuntary resettlement policy, this RP should observe the following basic rehabilitation planning principles:

z Make the resettlement soundly, fix relevant compensation into action, so as to boost or at least restore the affected residents’ living standards. z The resettlement should consider the relations of nation, community and individual. z RP should be compiled in accordance with physical index and compensation rates for land acquisition and demolition. Resettlement projects scale & standards shall be subject to the principle of original scale and standards restoring. Meanwhile, the investment gap should not be left on the basis of planned amount limitation. z RP should involve comprehensive negotiation with APs. z When making the resettlement plan, we also should take local city’s plan, resource plan, economic development and environment into consideration. We should take effective measures based on real and local conditions, so as to create the opportunity for resettlers’ own development.

5.2 Rehabilitation Measures for Permanent Land Acquisition Xinzhuang village has 280 households, with 1080 persons, and the arable land amounts to 750mu with 2.68 mu land per household, which is 0.7 mu land per capita. The land acquisition is 49.93 mu including 20 households which is 7% of the original farmland. After the land acquisition there was no land readjustment because the villagers decided that those whose land was expropriated would receive compensation. Since the persons concerned work entirely in secondary and tertiary activities, and not in farming they have had no time or inclination to use the land productively. Historically, they have rented the land to other villagers for farm activities.

36 To ensure that the land acquisition will not decrease the villagers’ income or impact on their living, the following specific measures are being taken: I) Cash Compensation and Individual handling of compensation. After the project EA distributed the compensation fund to the village, the village committee held villager meetings to determine no land readjustment any more and the compensation fund would be directly distributed to the affected rural farming households to make up the damage of economic income after land acquisition. The villagers invested a great deal of fund into non-agriculture including small-sized commerce, trade and transportation. This region provides a good investing environment. The need for more services will increase with the further implementing of the project. Being close to urban areas itself means more opportunity of employment, better education and skills training. Thus, the APs have found more ways to invest and more chances to profit. II) Tertiary Industry Development. 11 of the affected households in Xinzhuang village have made full use of the advantage closing to the county seat to develop transport and service and the like to increase income and in this way their income goes up to CNY1200 to CNY1400/month, which is much higher than working in agriculture. III) Readjust the agricultural structure. 8 of the affected households of Xinzhuang utilized the compensation fund and remaining 701 mu of land in their own villages to develop orchards, cultivate economically profitable crops, establish vegetable shed, raise animals and etc to increase the production rate of unit land. Their income amounted to CNY1200 to 1300/month, which does not decrease compared with agricultural income. IV) Skills training classes. Combined with Township government and village committees, WWTP has held training classes on three skills entrusting County Science Committee, Agricultural Bureau, Women’s Federation to organize them specifically. Every rural household has got two chances to be trained, one was to the male, and the other one was to the female. Since the participants were quite near to the county seat, the classes provided no accommodations for them. 1) Training Class on Agricultural Machinery Skills Sponsor: County Science Committee, lasting for 2 weeks with CNY4,500 of training cost from project owner. Time: April 2nd to April 17th 2005 Training contents: maintenance skills of agricultural machinery, electrician elements, electric welding skills, house decoration, computer maintenance, small-scale business registration and operation. Number of Trainee: 70 persons 2) Training Class on Agricultural Technique Sponsor: County Agriculture Bureau, lasting for 3 weeks with CNY8,000 of training cost from project owner

37 Time: June 25th to July 18th 2005 Training contents: plantation of economically profitable crops, animal/poultry breeding, plantation of yard economically profitable crops, plantation of fruits and vegetables in greenhouse in winter, insect pest prevention and cure for greenhouse plants. Number of Trainee: 120 persons 3) Training class on sewing technique and housework service for women Sponsor: County Women’s Federation, lasting for 2 weeks with CNY5,000 of training cost from project owner. August 2nd to August 17th 2005 Training contents: weaving skills, embroidering skills and housework service Number of Trainee: 90 persons V) Re-employment opportunities created by the project. During the construction of the Project, the project has created large amount of temporary job opportunities with priority to the APs especially and those who have lost most part or all the land, shall enjoy the privilege to be employed. Until now almost 20 APs have been provided with employment opportunity, which has increased their extra income source, and is good for them to develop their skills in the future.

5.3 Rehabilitation Plan for Temporary land use The temporary construction land refers to the land temporarily borrowed during construction phase, including sand and stone materials plant, mixture plant, productive and living areas in construction phase and temporarily occupied road. And all of the temporarily occupied land is chosen within the permanently acquired land scope, which doesn’t need to borrow other land. While in the construction phase of pipeline network, it will temporarily occupy roads, amounting to 445mu state land, which is recovered by the construction agency with the cost listed in the budget of RP.

5.4 Women Rights Protection No single woman-headed households due to the divorce, losing spouse and being abandoned are identified. In the affected area, the female has the same right as that of male. It includes cultivating, education, family planning, and village election, and etc. Most woman labor interviewed thought they had the same production and business right as that of men, such as doing the part-time job or doing tiny business or doing the farm work. Of course, there is a different division between male and female in the housework and production. The women will tend to choose the housework, farm work, handwork and native & specialty business, while more young people choose to make a living at coastal areas.

The construction and land acquisition of the Project will not have obvious influence on the

38 women whose land is expropriated.

During the project construction stage, the project owner will organize a group meeting concerning women representatives annually taking a village as unit. Meanwhile, we also conduct regular visit to some families so as to collect women’s suggestions, appeals and to accept their consultation. The village will report the owner the grievance concerning the women resettlement compensation and rehabilitation. The owner shall deliver the representatives to answer or settle the question within a week. The population considered to be in poverty shared the compensation policy with the average farmers.

6 Institutional and Organizational Structure

6.1 Institutional Framework In order to ensure the successful operation of the resettlement, the organizations responsible for planning, controlling, execution and supervision of the RP are listed as follows:

z Project Resettlement Leading Group (PRLG) z Implementing Agency of the Project (IA) z Land Acquisition Office of the IA (LAO) z Land Acquisition and Demolition Coordination Office in Chengguan Town z Village Committee and Village Group z Project Design Institute (DI) z External Monitoring and Evaluation Agency (MEA)

6.2 Institutional Framework and Responsibilities 1） Project Resettlement Leading Group

In order to fulfill the resettlement, Fengqiu County Government, Urban Construction Bureau, Land Bureau and Finance Bureau have established a leading group comprised by the responsible leaders of every bureau to supervise all the key activities involving land acquisition and resettlement and an office under the leading group has been created with the staff from IA and the other concerned local agencies for daily administration and implementation of resettlement plan.

2）Land Acquisition Office of the IA

A Land Acquisition Office of the IA is in charge of overall land acquisition and relocation affairs. More specifically, the office performs the following responsibilities:

z Drawing up the policies of land acquisition and resettlement; z Contracting the relevant design Institute to determine the boundary of construction according to Project design, investigating and storing the data of affection of this project; z Applying to City/County Planning Bureau for land-use permit, and applying to City/County Land Administration Bureau for construction land use permit ; z Training of the cadres working in the office; z Organizing drafting of Resettlement Plan and coordinating its implementation; z Managing, disbursing and supervising compensation funds;

39 z Directing, coordinating and supervising the procedures of resettlement and its progress; z Conducting internal monitoring on the progress of RP and drafting the report on the progress; z Choosing an independent agency and helping conduct external monitoring.

3）Land Acquisition and Demolition Coordination Office in Chengguan Town This office consists of cadres from each town, related units and the affected villages. It performs the following responsibilities:

To participate in the investigation of the Project and assist in the preparation of Resettlement Plan; z To organize the participation of the villagers and promote the policies of Resettlement and Relocation; z To implement, examine, supervise and record resettlement activities of all APs in the township; z To handle the procedure of the APs’ land acquisition and relocation; z To be responsible for disbursement and management of land compensation funds; z To supervise land acquisition, demolition of house, as well as relocation and house reconstruction; z To report the situation of land acquisition and resettlement to the county land administration bureau and resettlement management office; and, z To solve any conflicts and problems that may occur during the LAR process.

4）Village Committee and Village Group This group consists of the cadres from the village committee and villager groups. It performs the following responsibilities: z To participate in the survey of the socio-economic impacts; z To be responsible for disbursement and management of funds; z To report APs’ comments and suggestions to relevant departments; z To report land acquisition and resettlement implementation progress; and, z To provide assistance to households with financial hardship.

5）Project Design Institute The Design Institute of this Project is Henan Provincial Urban and Rural Planning and Design Institute. It performs the following responsibilities: z To design each item of the project according to the contract; z To determine the boundary of land acquisition and resettlement according to Project design. 6）External Independent MEA The External Monitoring and Evaluation Agency shall be determined by the bidding, which will be organised by Henan Provincial PMO, It will perform the following responsibilities: z To take responsibility for monitoring and evaluation of the work of resettlement and to provide full information of resettlement implementation and report the progress and problems and suggestions to ADB through the Office of Project Resettlement. This responsibility is fully described in Chapter 9 of this RP; z To provide consulting service to the Project in terms of date investigating and processing.

6.3 Staffing In order that the resettlement will be implemented successfully, the preparation office with each IA and relevant organizations involved in the resettlement implementation at various levels has

40 assigned competent and devoted staff to form a channel for the free flow of information from bottom-up. The staff of resettlement organization are made up of professional technicians and managements who possess the special managements and resettlement & relocation experiences. Fengqiu County has set up a special resettlement organization with professional technicians provided.

Table 6-1 Resettlement Organization Staff Referred in the Project

No. Of Full-Time Total No. of Resettlement Working Resettlement Resettlement Personnel organization schedule Staff Staff during peak Start from Project Leaders 6 11 Government officer July 2004 Relative person in engineer and Land Acquisition Start from 7 12 technology, Office of the IA July 2004 socioeconomic and investigator. Land Acquisition and Demolition Start from 6 18 Staff Coordination Office in July 2004 Chengguan Town Cadres of village Village Committee Start from 3 6 committee, villagers’ and villagers’ team July 2004 team Project design Senior engineer, Start from 2 4 institute engineer July 2004

External MEA 3 6 Professor, engineer May 2005

Total 19 41

6.4 Measures to Strengthen Institutional Capacity Building (1) Staffing Enhancement All organizations are made up of professional technicians and administration personnel who possessed the professional knowledge and management quality. (2) Training Enhancement z Major staff training and understanding of China state resettlement policies and the requirements of ADB. z To organize resettlement staff training so as to improve the operation quality and policy handling ability. (3) Ensuring sufficient capital and equipments so as to develop the working efficiency. (4) Establishment of perfect bonus-penalty measures concerning the demolition and resettlement so as to boost the performance of the staff. (5) Data base establishment and information feedback enhancement so as to guarantee the 41 successful delivery of information. Meanwhile, the major issues shall be handled by resettlement leading team. (6) Enhancement of report system and internal supervision so that the problems can be settled quickly. (7) Engagement of external independent M&E institute as well as the pre-warning system.

7. Public Participation and Consultation

7.1 Public Participation

7.1.1 Resettlement Information Brochures (RIB) Project owner has compiled and issued a brochure (Chinese) to APs according to the resettlement policy and entitlement model to inform them of: (1) applied policies and regulations (2) entitlements; and (3) the plan to restore income and living standard after land acquisition and the brochure is to strengthen movement openness. The brochure includes the basic key points of the construction project, the project schedule arrangement and the affected area, land acquisition and resettlement policy.

The brochures were handed to all the affected people in August 2005, meanwhile, the copies were sent to Chengguan Township Government and Xinzhuang village committee located in the affected areas.

7.1.2 RP Distribution

The RP has been provided to the affected villages and local officials, and moreover, any person who wants to know the plan can get the access to the information in the villages. The IA office keeps copies of the RP.

7.1.3 Public Consultation in Project Preparation Phase

APs’ suggestions and attitudes towards the projects that were obtained by the meetings between the village commission and householders have been summarized as follows: (1) From June to July 2004, the wastewater management department organized personnel to carry out a preliminary survey of condition of houses within the area to be acquired for the Project as well as relevant socio-economic survey. The representatives from affected households also took their part in the survey. Their suggestions to the project scheme, compensation for land acquisition and resettlement plan have been incorporated into project design and formulation of resettlement plan.

(2) The Implementing Agency and Village/Township Resettlement Office held a series of meetings, in which local cadres of all levels and all the affected people participated, to extensively publicize the national, provincial and municipal resettlement policies in China as well as respective policy requirement from ADB. Through these meetings, public opinions on how to reduce the project impact, how to resettle the people whose land would be acquired and

42 how to set the compensation standard for the affected households of different categories were sought/gathered, and extensive consultations were carried out, too.

(3)From July to August 2004, the Land Acquisition Office of Implementing Agency organized an investigation team of over 10 people to carry out the investigation-- the impact of land acquisition and resettlement on physical properties. Relevant representatives of affected household were involved in the investigation. At the same time, the Land Acquisition Office solicited from the representative villagers their opinion on optional sites, construction scale, construction scheme, land acquisition, resettlement and compensation standard. Extensive consultations were held by the Land Acquisition Office with affected households to pay due respect to their reasonable requests and opinions. In addition, the Land Acquisition Office also carried out socio-economic survey as well as survey of public opinion & psychology. In carrying out the socio-economic survey, door-to-door investigations were conducted on the affected households to investigate their willingness to give up farmland and their attitudes toward the Project. Comprehensive investigations as mentioned above laid the foundation for the formulation of the resettlement plan. Furthermore, in the process of resettlement planning, the Land Acquisition Office went into the villages and other grass-root villager groups to hold meetings and discussions with village cadres and representatives of affected households for permanent land acquisition and relocation/or to conduct randomized interviews with affected households for permanent land acquisition and relocation to further solicit their opinions and suggestions on resettlement, including their preference for the resettlement location and their demand/suggestions on employment & compensation policy.

(4) In the process of conducting social- economic survey of project impact, local government, affected villages and affected households for permanent land acquisition gave great support and their cooperation. It was obvious that in the preparation of Action Plan for Resettlement Plan they were involved into this work.

(5) In order to further publicize the project and get a better understanding of the public opinion on project construction and resettlement, it is necessary to solicit the opinions of affected people, relevant villages and other grass-root villager groups on project construction and resettlement before the formulation of the Resettlement Plan. Before September, 2004, the investigation arm of the Land Acquisition Office conducted a survey of public opinion & opinion of the affected households for permanent land acquisition via questionnaire. Altogether, 100 households within the affected area were included in the investigation by questionnaire.

(6) The IA convened a series of meetings with affected people and conducted home visits of affected households during September to November 4th 2005. In the meeting, IAs also answered questions regarding issues on the land acquisition and resettlement and heard the suggestions and opinions.

(7) The survey again confirmed the support from the APs. Actually, 95% of the APs supported the subproject; only 5% of the APs showed indifferent. No AP against the subproject has been found. The APs were satisfied with the compensation rates and entitlements, but wished compensations could be paid to them as soon as possible that they could restore the income and living standard the sooner the better. Some resettlers inquired the compensation procedures and got the guarantee that the land acquisition, demolition and resettlement would not be carried out until they agreed and signed the agreements with AYWAG and that all the compensation for ground attachments should be paid to every family via village committee at the same time.

(8) Also the brochure explained to APs that the demands and grievance procedures can be addressed through various channels (including construction bureau of area, office and village commission). Meanwhile, satisfaction of restoration plan was among the inquired people and

43 some of whom were willing to participate in the plan.

The keynotes on consultation are shown in Table 7.1.

Table7.1 Public Participation during TA to the Project

Organization-in-deputy Propose Date Key issues discussed

·Compensation rate for Compensation rate for land acquisition and land acquisition and Locations of wastewater treatment plant, temporary land of use demolition formulated 05/30/2004 offices, village leaders and deputies of and demolition after discussion with relevant affected enterprises quantity of houses, village leaders ground attachment. ·Combined with the WWTP, Henan Provincial Urban and Rural realities of project Programming and Planning Institute, area, collecting the Coordination for RRA 07/13/2004 village leaders opinions of local government and villagers. ·technical demand of the land acquisition and demolition WWTP, Henan Provincial Urban and Rural ·investigation on the Programming and Planning Institute, assets Project Resettlement Investigator Group, 05/08/2004～ Conducting survey on ·sampling survey on the office of wastewater treatment plant 03/09 land acquisition and the socio-economy of where located, village leaders demolition the affected

households and afford the copies of flat draw WWTP, Henan Provincial Urban and Rural Programming and Planning Institute, Sending out the brochures ·the households, shops August ～ Project Resettlement Investigator Group, of immigration, handling and other relevant December the office of wastewater treatment plant with feedback agencies which are 2004 where located, village leaders suggestions, and revising affected resettlement report ·opinions about PPTA, WWTP, Henan Provincial Urban resettlement and Rural Programming and Planning Collecting the suggestions compensation Institute, Project Resettlement Investigator of land acquisition and 08/09/2004 to scheme gathered Group, the office of wastewater demolition 10/09/2004 from leaders of village treatment plant where located, village committee influenced leaders and the enterprises

and villages ·affected land and houses ·eligible for compensation ·rules and regulations for the land WWTP, Henan Provincial Urban and Rural September ～ acquisition and house Programming and Planning Institute, Identification of the scope December demolition Project Resettlement Investigator Group of land acquisition and 2004 · compensation rate movement ·main themes and components of land acquisition and demolition report ·principles to identify impact degree

44

7.1.4 Public Participation and Consultation in Implementation Phase The local county government, township government, village committees and APs at all levels have had discussions about land acquisition and rehabilitation plan and its implementation comprehensively and specially pay attention to compensation, land re-distribution, income and livelihood restoration. The public participation and consultation is shown in Table 7.2.

Table 7.2 Public Participation Activities in Implementation Phase

Activities Implementing Aims of activities Date Participants Remarks mode agencies 1. Provide APs with the specifications of executing the project and land Public agencies, offices, ·meeting is a must relocation and May 2005 All APs meeting and village for every village collecting opinions committee from the APs

Household ·Inventory of all 2. Conducting final executing visiting and property and land survey on the agencies, offices, survey on June 2005 All APs ·collecting the assets and and village physical augmenting demolition committees property socio-economic data

·handing the draft of RP to every AP ·discussing issues Focused executing on land acquisition Group 3. Proposing the agencies, offices, and demolition meeting for July 2005 All APs final RP on to APs and village ·discussing with public and committees each focus group affected area and collecting opinions and suggestions Focused executing 4. Informing The interest group agencies, offices, ·holding meetings beneficiaries of the August holders and meeting in and village with beneficiary progress of design 2005 beneficiary the affected committees residents and APs and construction and APs area 5. Informing APs of executing holding residents September the entitlements Public agencies, offices, meeting to inform of to October All APs and compensation meeting and village key points of 2005 date. committees entitlements ·determining need for support executing augmentation for June 2005 agencies, offices, 6. Supervision to underprivileged and inner-door to and village Random APs’ entitlement vulnerable groups visiting December committees、 sampling realization ·-Introductions and 2006 independent supervision on land outside supervisors acquisition and demolition

45 7.2 Grievance Redress Procedures

7.2.1 Targets for Grievance Redress Procedure In order to safeguard the relevant personnel have proper resolutions to the issues on land acquisition and resettlement, the detailed grievance redress procedures have been established on purpose that it can guarantee the relevant persons’ opinions about the project can be solved fairly, properly and rapidly. The procedure is simple, feasible, open, and fair. In the long view, it aims to prevent APs from forcedly resorting to complicated formal channel to express grievance and opinions, namely, to redress relevant persons’ grievance or opinions inner the project management organizations, which minimizes impact on project progress and makes the redress process more efficient as well.

7.2.2. Grievance Redress Approaches

In order to solve these problems in a timely and effective way and guarantee that project construction and land acquisition could be carried out smoothly, a transparent and effective grievance channel has been established for the affected person of the project in addition to existing appeal and grievance channels of local governments at all levels. The detailed procedures run as follows:

Stage 1: If the affected persons/enterprises are not satisfied with the planning or implementation of resettlement and relocation, they may make oral or written appeals to the township RO, village office or the IA of the Project. Relevant agencies should resolve the issue within 2 weeks.

Stage 2: If the affected persons/enterprises are not satisfied with results of stage 1, after receiving the results, they may appeal to the Resettlement Office at county level, who in turn should resolve the issue within 2 weeks.

Stage 3: If the affected persons/enterprises are still not satisfied with results of stage 2, after receiving the decision from the County Resettlement Office, they may appeal to the Leading/Decision-Making Team for Resettlement at the municipal level and ask for administrative arbitration. The arbitral authority should make its decisions within 10 days.

Stage 4: If the affected persons/enterprises are still not satisfied with the arbitral decision from the arbitral authority, after receiving the decision, they may file a civil suit based on law of civil procedure. The affected person may sue for any aspect of the resettlement and relocation, including compensation standard, etc.

7.2.3 Grievance Redress Scope The APs can dispute any aspect of resettlement and payment of compensation including the compensation amount. And they are informed of the procedure through the resettlement information brochure. Also this information can be delivered to the APs via public meetings preceding land acquisition. During the whole course of project construction, the grievance redress procedures are still available for safeguarding the villagers utilizing these to handle the issues regarding the infrastructure rehabilitation, such as irrigation, the entrance of usual roads, temporary utilization of land and the like. Thus, villages can propose the problems to the management agencies in an effective way for timely solution.

7.2.4 Grievance Result There have been no formal grievances by APs in the preparation or implementation phases. 46 7.1.5 Figure 7.1 Grievance Redress Procedure

Municipal, County People’s Court Fengqiu County People’s Government

Monitoring and Evaluation Institute Municipal, district Land Acquisition Office of the IA discipline inspection committee, supervision

Municipal, district Township Land acquisition and Grievance Redress coordination office Committee office

Village committee

Affected Persons

47

8. Monitoring & Evaluation

In order to implement land acquisition and RP strictly due to demands, regular M&E should be carried out in the implementation stage. The M&E on RP can be divided into two parts: internal and external M&E.

8.1 Internal M&E The Leading Team, relevant functions and project preparation sect are responsible for the internal M&E with internal monitoring office of 3 persons in the preparation sect to carry out internal M&E safeguard timely resettlement due to project plan and to protect APs’ benefits.

8.1.1 Main Monitoring Contents z Compensation Payment z Grievance acceptance z income restoration/ training plan z assistance to vulnerable groups.

8.1.2 Internal Monitoring Objectives z Inspecting the completing progress of land acquisition and demolition z Safeguarding the establishment and being straightway communication and coordination channels between the project management personnel and the APs. z Safeguarding compensation payment for the APs fully and punctually. z Ensuring the APs’ grievance being handled in the given time. z Strictly ensuring compensation payment for land loss to the APs and provision of resettlement subsidy due to rules and regulations.

8.2 External M&E The external M&E on RP should be carried out by an organization or institution which is extremely independent of project executing agencies and local government. The project is proposed to retain an independent institution to take charge of external M&E by means of bidding invitation.

8.2.1 External Monitoring Objectives z Confirming whether APs’ welfare is restored or maintained after completion of land acquisition and demolition z Identifying the restraints in policy and implementation if no restoration or maintenance z Evaluating the general efficiency, result, impact (APs’ behavior reaction included) and the sustainability of land acquisition and demolition policy and practice.

48

8.2.2 Means and Methods The general method is monitoring the activities, evaluating project impact and safeguarding public participation of all the APs, especially of women and vulnerable groups. The monitoring tools include both qualitative and quantitative ones:

z The baseline survey on the affected households is a representative sampling survey, which categorize due to gender and vulnerable groups to get relevant information of main indicators such as compensation distribution, efficiency, validity, impact, sustainability and etc. 20% of the APs were taken as random samples. z Group discussion allows consultation from every related party of M&E (local government, host site personnel, NGO, community leaders and affected groups) z The talks with key persons, visiting the significant persons with relevant experience in land acquisition, resettlement and implementation such as local leaders, village leaders. z Community public meetings: Holding the public meetings in the resettlement site, and explicating the information on the demolition resettlement z Direct Structural/objective observation: Carrying out filed study on the implementation of demolition and resettlement and cross-visiting the individuals and groups for the messages. z Informal survey or dialogues: Adopting non-sampling way to carry out informal survey on APs, main villages, workers, resettlement staff and those of executing agencies

8.2.3 Reporting Requisition

The progress of implementation should be reported to the IA quarterly.

During the process of RP implementation, the external M&E institution should compile and submit M&E reports to ADB once half a year and then it should compile socioeconomic survey and evaluation reports every year until the APs’ livelihood was fully restored.

The M&E reports on project half-completion and total-completion should comprise evaluation reports on project key points, detailed interpretation of compensation payment and other measures to maintain or increase a little APs’ socioeconomic situations in “no project” state. And moreover, the experience and lessons from the land acquisition and resettlement should be included in the report for policy and method formulation in the future.

8.2.4 Resettlement M&E Outline See Table 8.1 for resettlement M&E outline.

49 Table 8.1 Resettlement M&E Outline

M&E Types of M&E Indicators Institution M&E ·Has the capacity building and training activities been carried out as planned? ·Has resettlement implementation being completed due to the Budget and negotiated implementation schedule? time frame ·Has the compensation fund be paid to the resettlement office on time? ·Has all the land for project construction been acquired or occupied? ·Have all the APs got their entitlements as stipulated in Entitlement Delivery of Matrix? AP ·Have the APs received compensation fee on time? Entitlements Internal ·Has the income and livelihood rehabilitation been carried out as

M&E planned? ·Has the consultation been carried out as planned? Is the RIB ready to be distributed to APs? Consultation, ·How many APs know about their rights? How many APs know Grievance whether they are entitled to the rights? and special ·Has any AP used grievance redress procedure? What is the Issues result? ·Has the problem been solved？ ·Has the APs’ income and expenditure pattern changed compared to that before the subproject was carried out? Effect M&E ·Has the living expense of the APs changed? Does their income match to the changes? ·location, householder, nationality, housing types Basic ·family member, structure, ages, education background and External Information technical skills M&E on Affected ·land and other resources owned and the usage pattern of those Households resources ·income source and level, occupation and employment type Restoration ·Whether do the APs obtain main substitutes in culture and of living society? standard

50 ·Has the compensation fee been discounted due to depreciation and discounts? ·Is the compensation fee enough for the APs to recover their lost assets? Restoration ·Have the affected enterprises received enough compensation to of livelihoods reconstruct the enterprise? ·Have the farmers been provided with opportunity to profit getting? Are the measures effective and sustainable? ·Have the APs regain their living standards after the resettlement by using the proposed rehabilitation measures? ·How much do APs know about the resettlement process and their entitlements? Levels of AP ·How do APs assess their living standards and livelihood after the Satisfaction rehabilitation? ·Do the APs know about the grievance redress procedure and conflict solving approaches? ·Have the APs and their possessions been correctly recorded? Effectiveness ·Have the time frame and budget been carried out sufficiently? of the RP ·How does the IA deal with contingencies？

9. Resettlement Budget

The costs incurred by land acquisition and resettlement are included in the overall budget of the project. The total cost of land acquisition and resettlement for Fengqiu subproject is estimated to be CNY 11.38 million according to the price of October 2005.

9.1 Contents of Resettlement Costs

9.1.1 Land Acquisition & Resettlement i) Permanent land acquisition According to the project plan and the contract signed between Land Acquisition Office of the IA and Fengqiu County Land Bureau as well as the agreement signed with village committees, the permanent land acquisition of this project is 49.93 mu, along with compensation fee is CNY1.87 million, including land compensation, resettlement subsidies, and compensation for standing crops. ii) Arable Land Occupancy Tax Totally it amounts to CNY0.15 million. 51

9.1.2 Infrastructure and Facility

The pipeline network of the project involves temporary impacts to roads and its total compensation cost for repairing amounts to CNY7.30 million.

9.1.3 Other Costs The designing & reconnaissance costs are 2 percent of the land acquisition, resettlement, infrastructures and facilities. The M&E costs are 2 percent of the land acquisition, resettlement, infrastructures and facilities. The management costs are 3 percent of the land acquisition, resettlement, infrastructures and facilities. The training fee is CNY17,500 for three training classes.

9.1.4 Contingencies Contingencies budgeted for are 15% of the total cost of land acquisition and rehabilitation, of which 10% is physical contingency owing to the changes of qualities in the course of resettlement; 5% is price contingency for currency inflation and any prices changes during the resettlement.

9.2 Budget Table on Resettlement Costs The land acquisition and resettlement cost budget of Anyang Zongcun Wastewater Treatment Project is shown in Table 9.1.

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Table 9.1 Cost Estimation for Land Acquisition and Resettlement of Fengqiu County WWTP project

Compensation Budget Type Unit Quantity Rate (Yuan/unit) （CNY10,000） A. LAR 201.90 1. Permanent Land Acquisition 186.92 Land Compensation and mu 49.93 26000 129.82 Resettlement Subsidy Standing crops mu 49.93 650 3.25 Farmland reclamation mu 49.93 5625 28.09 Land use cost for augment mu 49.93 4467 22.30 construction Land acquisition mu 49.93 694 3.47 management cost 2. Farmland occupancy tax mu 49.93 3000 14.98 B. Infrastructure and Facility 729.51 Recovery of road surface Asphalt road m2 75392 80 603.14 Pavement m2 42124 30 126.37 Subtotal of A and B 931.41 C. Other costs 66.95 Reconnaissance & design 2% 18.63 M&E cost 2% 18.63 Administrative cost 3% 27.94 Training cost 1.75 D. Contingencies 139.71 Physical contingency 10% 93.14 Price contingency 5% 46.57 E. Total 1138.07

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9.3 Resettlement Investment Plan

Table 9.2 Resettlement Investment Plan by Stages

Investment Investment By Fiscal Year（CNY10,000） Item (CNY10,000) 2004 2005 2006 2007 A. Land Compensation 186.92 186.92 B. Compensation for Infrastructure 729.51 230.5 278.3 220.71 C. Other costs 66.95 20 20 20.43 6.52 D. Contingency 139.71 68.5 56.84 14.37 E. Relevant tax 14.98 14.98 Total Costs 1138.07 20 520.9 355.57 241.6 proportion 100.00% 1.76% 45.77% 31.24% 21.23%

10 Implementation Arrangements and Schedule

As the schedule the wastewater treatment project will commence in September 2006. Land acquisition and resettlement activities commenced in early 2005 and land compensation was completed by December 2005, so the land was ready for pre-construction activities.

10.1 Principles to Formulate the Resettlement Schedule

z The scope of land acquisition and demolition should be eventually determined due to engineering plan, and the determination should be completed prior to the kind measurements and calculation in land acquisition and demolition. z Land adjusting\allocating is finished in the time between two seasons. z The land acquisition should be prior to the constructions of each area. z The labor resettlement should be finished prior to the land acquisition. z The affected enterprises and shops should be compensated for loss in down time prior to commence of project. z The calculation and distribution of the compensation should be done before land acquisition or demolition and after agreement signed.

10.2 Overall Schedule of Land Acquisition and Resettlement Activities The overall schedule of land acquisition and resettlement activities is studied out according to the schedule of land acquisition and resettlement preparation and implementation. See Table 10.1 for the overall schedule.

10.3 Actual Progress

·The preliminary phase of the Project was from March 2004 to March 2005 to complete the authorizing and examining job of the project feasibility study report, verifying the adequacy of the available water resource, and evaluation of environmental impacts. ·The pre-construction phase (1) was from July 2004 to November 2005 to complete the 54 preliminary design, detailed design for construction, and corresponding procedures for examination and approval. In December 2005 the approval of the land acquisition certificate had been reached (No.627[2005] Notice of Henan Land & Resources). · The pre-construction phase (2) was from January 2006 to April 2006 to complete the requisition of land and demolition job, the site grading job ,etc. · The pre-construction phase (3) was planned from August 2006 to September 2006 to complete preparatory works for the wastewater pipeline and wastewater treatment plant, public bidding and evaluation for facilities, and sign construction contract of the Project. ·The project construction is planned from September 2006 to September 2007 to conduct all the construction activities including civil works, pipeline and facilities equipment and etc. ·Debugging and trial-running period is planned from October 2007 to December 2007 to complete debugging and trial-running of the project. ·Completion and reception period is planned in December 2007 to complete the project and finish the check and reception activities.

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2004 2005 2006 2007 Table 10 1 Schedule of land acquisition and resettlement activities 5678910 11 12 12345678910 11 12 12345678910 11 12 12345678910 11 12 Activities of Land Acquisition and Resettlement Conduct detailed survey of Aps Apply for Approval of LAR Determine Aps' Resettlement site identify, determine poor and vulnerable groups finally determine compensation and resettlement strategy negotiate to sign contract LAR pay compensat i on f und adj ust l and demolish buildings Income r est or at i on Aps induced by the land acquisition in construction phase agriculture propaganda service/training new ski l l t r ai ni ng ot her i ncome r ehabi l i t at i on scheme special assistance to the vulnerable groups Ci vi l wor ks compl et e det ai l ed desi gn construct WWTP/water supply plant construct pipeline M&E Set up i nt er nal M&E mechani sm, pr ocedur e and f or mat sel ect M&E Age nc y ADB appr oves t he TOR train resettlement st af f moni t or LAR act i vi t i es monitor income rehabilitation activities conduct ext er nal M&E

1 11. Due Diligence and Retrofit Measures

11.1 Due diligence This Project is an urgent requirement of the local government in order to improve the urban environment quality of Fengqiu County. To speed up the project, Fengqiu Wastewater Treatment Company selected its preferred site in 2004 and began the process of land acquisition in mid 2005. However, this was done in advance of (i) ADB approval of the RP and (ii) local land acquisition approvals. For these reasons, ADB requested the IAs to conduct due diligence and revise their RP to reflect the actual status of implementation. On this basis, ADB would make a decision on the RP approval and disbursement of loan funds for this project.

11.1.1 Compensation standards and Disbursement Based on the RP, the compensation fund for land acquisition included that for land with the standard of CNY13,000/mu, resettlement subsidy of CNY13,000/mu and that for standing crops of CNY650/mu. By December 2005, the compensation fund of CNY1.33 million has totally handed out. After villager meeting to get agreement, the compensation fund has been disbursed to the affected farmers without land readjustment.

11.1.2 Distribution of Compensation Fund After the land acquisition, the IA paid the full amount of the compensation fund via the village committee, who retained nothing, to the affected households, and each transaction was registered. This process followed a meeting between the village committee and the villagers at which it was also decided there would be no land readjustment.

11.1.3 Rehabilitation Measures I) Cash Compensation and Individual handling of compensation. The villagers invested a great deal of their compensation into non-agriculture activities including small-sized commerce, trade and transportation. This region provides such investment opportunities. The need for more services will increase with the further implementation of the project. Being close to urban areas itself means more opportunity of employment, better education and skills training. Thus, the APs have found more ways to invest and more opportunities to profit. II) Tertiary Industry Development. The 11 households in Xinzhuang village have developed transport and service and the like to increase income and in this way their income goes up to CNY1200 to CNY1400/month, which is much higher than working in agriculture. III) Readjust the agricultural structure. 8 households of Xinzhuang utilized the compensation fund and remaining land in their own villages to develop orchards, cultivate economically profitable crops, establish vegetable shed, raise animals and

62 etc to increase the production rate of unit land. Their income amounted to CNY1200 to 1300/month, which much higher than working in agriculture. IV) Skills training classes. Combined with Township government and village committees, WWTP has funded training classes on three skills entrusting County Science Committee, Agricultural Bureau, and Women’s Federation to organize them specifically. Every rural household has got two chances to be trained, one was to the male, and the other one was to the female. Since the participants were quite near to the county seat, the classes provided no accommodations for them. V) Re-employment opportunities created by the project. During the construction of the Project, the project has created large amount of temporary job opportunities with priority to the APs especially the poor population and those who have lost most part or all the land, shall enjoy the privilege to be employed. Until now almost 20 APs have been provided with employment opportunity, which has increased their extra income source, and is good for them to develop their skills in the future.

11.1.4 Fund utilization By the means of skill training funded by the project owners, the affected rural households made full use of the compensation fund, part of which was used for readjust planting structure to develop greenhouse planting. Taking advantage of locating in the county seat, they have used many ways such as transportation in the urban area, service, and self-employed business and shops to get more profit.

11.1.5 Internal M&E The capacity building and training activities have been finished as planned. The fund for resettlement has been allocated to the resettlement organization on schedule. All the land for the project implementation has been expropriated and occupied. Due to the land loss and types stipulated in Entitlement Matrix, all APs have received their entitlements. The APs have got the fund on time and the income and living rehabilitation activities are being undertaken as planned. The negotiation and public consultation have been conducted as planned too. RIB has been handed out to the affected households. 93% of the APs understood their entitlement, and currently no AP had appeal and complaints. To readjust the structure of agriculture after the available land was reduced, 8 families of Xinzhuang utilized the compensation fund and their remaining land in the village to develop orchards, plant economically viable crops, establish green houses and develop animal breeding. These activities helped to increase production per unit area. Their incomes have reached CNY1,200 to CVNY1,300 per month demonstrating that they are at least as well off now as before the project. These activities were supported by training in April 2005 on agricultural machinery repair, electric welding and use of electrically powered devices, house rehabilitation, and how to establish and to register a small business. In June and July 2005, training was also conducted for the improvement of agricultural skills and in August 2005, training was conducted for women in sewing and housekeeping.

63 While after land acquisition, the affected households developed secondary and tertiary activities and readjusting planting arrangements, average gross income per household is CNY9,840. Of this amount, CNY689 (7%) is directly from agriculture, CNY3,543 (36%) is from sideline work, CNY2,2264 (23%) is wages from employment in various enterprises, CNY2953 (30%) is from outside work and CNY394 (4%) is from other activities..

11.2 Implementation issues/problems/grievances Due to the construction of this project, the original production system in the areas of Xinzhuang village in Chengguan Town has been damaged, which causes some impacts on the local agricultural production to some extent. The affected Xinzhuang will not readjust arable land but simply paid land compensation to those people who lost their land. Therefore, it has much impact on the 20 families whose land is occupied. Mostly, these APs have taken up opportunities in the county to establish and participate in sole trader and small business activities, and 70% of APs are working in such secondary and tertiary industry. In terms of income they are slightly better off than before the project. In total, CNY1.331 million was distributed in compensation to the APs.. The specific measures include development of tertiary industry, readjustment of agricultural structure and skills training classes. The monitoring will continue to ensure the capacity building and training activities are completed as planned; the compensation for resettlement has been allocated to the resettlement organizations; the APs got the compensation fund due to the Entitlement matrix which indicates the loss and types; and the RIBs have been handed out to the APs.

64 Appendix 1: Minutes of Group Meeting with Parts of Village Leaders, Enterprises and Public Representatives Date: June 20th, 2004 Place: Conference room of Fengqiu county construction bureau

Participants: Title Zhu Deng Lian The County Project Office Director Gao Jia Gin County Financial Bureau Yao Xue Tong Henan Provincial Urban and Rural Programming and Planning Institute,

Jin Fa Wen County Construction Bureau Shi Tuo Chengguan Town An Hao Min Village Leader of San Li Xin Village of Chengguan Town Villager Representatives 12 Persons, including Zhao hong Shun, Li Shi Zhou, An Guo Sheng, Fan Er Li, Fan Wei Liang, and others

The AYWAG studied the regulations and laws of reference and invited some enterprises and personal deputies summoned to discuss the issues by what can make the each village and persons, those who suffered a lot from the project of land acquisition of wastewater handling factory of Zongcun as loaned from the ADB, knew the better knowledge of the contents, objects, standards of compensations for the land acquisition, ways of compensations, payment and policy of relocation. In the course of meeting, pre-established construction office had a good parley with persons anticipated on the plausible rules or the planned compensations, and copied the modes of relocations to them. The compromises and suggestions reached lodged by each recorded as follows: I. The deputies expected that the land acquisition should be performed based on the Land Administrative Law of People’s Republic of China revised on the 5th council of 7th standing committee of national people’s congress on 29th December 1998, and Management Rules on Demolishing houses of City issued by 40th conference of State council in 2001 and the details of demolition for Anyang under construction. II. The deputies expected that the compensation at length and ways of relocation should be discussed at any time in the future after the land

65 acquisition policy and rules were fully understood. III. They expected that the project owners took the actions to minimize the damages to the local people and the PMO promised to carry out the project in this principle. IV. The wastewater treatment plant is expected to give priority to employing local APs after its completion of construction.

Fengqiu County WWTP Leader Group

20/06/2004

66 Appendix 2: Minutes of Negotiation Meeting on Resettlement and Rehabilitation

Date: 20/09/2004 Place: Conference room of Chengguan town

Participants: Title Zhu Deng Lian The County Project Office Director Yao Xue Tong Henan Provincial Urban and Rural Programming and Planning Institute,

Jin Fa Wen County Construction Bureau Shi Tuo Chengguan Town An Hao Min Village Leader of San Li Xin Village of Chengguan Town Villager Representatives 12 Persons, including Zhao hong Shun, Li Shi Zhou, An Guo Sheng, Fan Er Li, Fan Wei Liang, and others

The Fengqiu County WWTP visited the persons who suffered a lot and coordinate with them for the purpose that the inhabitants who suffered from the land acquisition could revive the normal standard as usual, and had a parley with the local government, village commission, enterprises and the deputies of villagers. The officers and the investing units got the suggestions and advices lodged by the relative units and deputies and then made the preliminary resettlement and rehabilitation plan with minutes as follows:

1. Introducing to the participants the profiles, contents, meaning, capital collection, limited period of construction, and the demands of the ADB. It is of great pleasure for local government hand a feasible and practical proposal of relocation to safeguard the living standard of the people after project construction.

2. Engineer Yao Xue tong, Henan Provincial Urban and Rural Programming and Planning Institute, introduced the scope of land acquisition of the project and the effect on each village to the participants. 3. The local leaders and villager representatives have discussed about the relevant regulations and rules provided by PMO and they demanded that the

67 compensation rate should be determined due to the reality of APs without restraint of the relevant methods or rules. 4. The local government, PMO and the villagers representatives got the consensus on the compensation means as follows: z Compensation of Agriculture The permanent farmland loss should be compensated in cash to APs as five times of average output in the past 3 years. The individual or enterprise using farmland legally shall be settled by means of land reallocation or other methods in land exchange mechanism. The temporary farmland loss should be made up with land restoration subsidy at 3 times of average output of the affected farmland with cash compensation direct to APs and the land acquisition can not exceed half a year. z Standing crop Crops All APs of permanent farmland loss including the renters or illegal users will receive the 0.5 time as full compensation according to the average output of the past three years, namely, in addition to land restoration subsidy, the compensation for standing crops shall be paid. z Land resettlement Subsidy All the APs of permanent farmland loss have rights to obtain land resettlement subsidy which is equal to 6 times of average output of the past 3 years.

5. The local government, PMO and village representatives have got consensus on the following fund payment methods The local government of relevance should inform and hear the suggestions of the rural collective economic organization and villagers according to the newly-issued Land Administrative Law of People’s Republic of China; the rural collective economic organizations whose land has been acquired should inform of the income and expenditure status to the members and receive their supervision.

In order to get the compensation in account timely and adequately, the subsidy funds of land acquisition and demolition should set up special accounts for special use and no embezzlement.

The special accounts are necessary for the subsidiary of each relocation for the purpose of making the subsidiary costs been on time.

68 During the process of demolition and resettlement, all accountings should be safeguarded by special persons and every check should be signed by more than 3 persons for openness, justification and transparency. No single one can decide anything and all kinds of compensation fund tables should be placarded to eye-striking places in red paper for APs and the mass to know it clearly at first sight.

The EA will always pay close attention to resettlement and rehabilitation and coordinate with the local governments actively ensuring that the affected residents should be resettled actively and safely and the living standards of residents in the scope of project affected area should be increased steadily after completion of project construction.

Fengqiu County WWTP Leader Group September 20, 2004

69 Appendix 3: The List of Fengqiu County WWTP Leader Group

Name Title Cheng Tian sheng Vice Director of the County

Liu Jin ling Director of County Financial Bureau

Zhu Qi lin Director of County Construction Bureau Yao Chen Ju Director of County Economic Planning Bureau Ma Shao Wen Director of County Land Administration Bureau Li Jianjun Director of County Environment Protection Bureau Shi Tuo Vice Director of Cheng guan Town Jin Fawen Vice Director of County WWTP

70 Map of the Fengqui WWTP Site and the Sewer Network

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