50064-001: Batumi Bypass Road Project

Resettlement Plan

June 2019 Draft

GEO: Batumi Bypass Road Project

Bakurtsikhe-Tsnori Road Section

Prepared by the Roads Department of the Ministry of Regional Development and Infrastructure of Georgia for the Asian Development Bank.

This 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. Your attention is directed to the “terms of use” section of this website.

In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

CURRENCY EQUIVALENTS (as of 20 June 2019)

Currency Unit – lari (GEL) $1.00 = GEL 2.787

ABBREVIATIONS

ACS – acquisition and compensation scheme ADB – Asian Development Bank AR – Adjara Republic CSC – construction supervision consultant AH – affected family AP – affected person CBO – community based organization DMS – detailed measurement survey RDRD – Road Development and Resettlement Division GoG – Government of Georgia GRC – grievance redress committee IA – implementing agency IP – indigenous peoples EMA – external monitoring agency km – kilometre LAR – land acquisition and resettlement LARC – land acquisition and resettlement commission LARF – land acquisition and resettlement framework LARP – land acquisition and resettlement plan M&E – monitoring and evaluation MFF – multitranche financing facility MOF – Ministry of Finance MPR – monthly progress report MRDI – Ministry of Regional Development and Infrastructure MoESD _ Ministry of Economy and Sustainable Development NAPR – National Agency of Public Registry NGO – non-governmental organization PEMI – persons experiencing major impact PFR – periodic financing request PPR – project progress report PPTA – project preparatory technical assistance PRRC – Property Rights Recognition Commission R&R – resettlement and rehabilitation RD – Roads Department RDRD – Resettlement Division of Road Department RDMRDI – Roads Department of the Ministry of Regional Development and Infrastructure of Georgia RoW – right of way RU – resettlement unit SES – socioeconomic survey SPS – safeguard policy statement TRRC – Transport Reform and Rehabilitation Centre

NOTE In this report, “$” refers to US dollars.

Page 2 || 132 Table of Contents

GLOSSARY ...... 6 EXECUTIVE SUMMARY ...... 8 1 INTRODUCTION ...... 19 1.1 Project Background ...... 19 1.2 Minimizing Land Acquisition and Resettlement ...... 21 1.3 LARP Preparation ...... 21 1.4 Pending LARP Implementation Tasks ...... 22 1.5 Conditions for Project Implementation ...... 22 2 CENSUS AND IMPACT ASSESSMENT ...... 23 2.1 The Impacts Corridor and Affected Plots ...... 23 2.2 Impact on Land, Other Assets and Income ...... 24 2.2.1 General Classification of affected land ...... 24 2.2.2 Impact on Crops ...... 26 2.2.3 Impact on Trees ...... 27 2.2.4 Impact on Buildings/Structures ...... 29 2.2.5 Relocation Needs and Strategy ...... 31 2.2.6 Business Impacts ...... 31 2.3 APs and Communities ...... 31 2.3.1 Impact on Employment and Agricultural Tenants ...... 31 2.3.2 Impact on Common Property Resources ...... 31 2.3.3 Severely Affected and Vulnerable Households ...... 31 2.4 Impact on Indigenous Peoples ...... 32 2.5 Gender and Resettlement Impacts ...... 32 2.6 Summary of Impacts ...... 32 3 SOCIO-ECONOMIC INFORMATION ...... 35 3.1 Introduction ...... 35 3.2 Affected Population ...... 35 3.2.1 Occupation and Main Source of Income of AHs ...... 36 3.2.2 Expenses of AHs ...... 37 Possessions of AHs ...... 38 3.2.3 Education and Literacy of AHs ...... 39 3.2.4 Women in the Local Context ...... 40 4 LEGAL and POLICY framework ...... 41 4.1 General ...... 41 4.2 Legal Framework ...... 41 4.2.1 Georgia’s Laws and Regulations on Land Acquisition and Resettlement ...... 41 4.2.2 Expropriation ...... 42 4.2.3 Legalization ...... 43 4.2.4 ADB’s Policy on Involuntary Resettlement ...... 43 4.2.5 Comparison of ADB Policy with Georgian Laws and Legislation ...... 44

Page 3 || 132 4.2.6 Resettlement Policy Commitments for the Project ...... 45 4.2.7 Land Acquisition Process ...... 46 4.3 Compensation Eligibility and Entitlements ...... 47 4.3.1 Eligibility ...... 47 4.3.2 Eligibility Criteria for Compensation of APs ...... 47 4.3.3 Compensation Entitlements ...... 48 4.3.4 Additional Rehabilitation Measures ...... 53 4.3.5 Validity Period of Valuation Report and Unit Rates ...... 53 4.3.6 Escrow Accounts ...... 53 4.3.7 Taxation and Official Fees ...... 54 4.3.8 Trainings and other assistance ...... 54 4.3.9 Entitlement Matrix...... 54 4.3.10 Valuation and Compensation Rates ...... 60 5 INSTITUTIONAL ARRANGEMENTS ...... 62 5.1 Introduction ...... 62 5.2 Roads Department and Consultants ...... 62 5.2.1 Roads Department ...... 62 5.2.2 Euro-Asian Transport Corridor Investment Center (ETCIC) ...... 63 5.2.3 RD Consultants ...... 63 5.3 Local Governments ...... 63 5.4 Land Registration Organizations ...... 64 5.4.1 Representative of Municipality at the village/community level ...... 64 5.4.2 Municipal Sakrebulo ...... 64 5.4.3 Property Rights Recognition Commission (PRRC) ...... 64 5.4.4 NAPR Regional Registration Office ...... 65 5.5 Other Agencies and Institutions ...... 65 5.6 Monitoring Agency ...... 66 6 CONSULTATION, AND PARTICIPATION...... 69 6.1 Introduction ...... 69 6.2 Consultation Process and Methodology ...... 69 6.3. LARP - Disclosure ...... 71 7 GRIEVANCE REDRESS MECHANISM ...... 74 7.1 Objectives ...... 74 7.2 Grievance Resolution Process and Structure of GRM...... 74 7.3 GRC Records and Documentation...... 77 8 IMPLEMENTATION SCHEDULE ...... 79 8.1 General ...... 79 8.2 LARP Approval and Initial Tasks...... 79 8.3 LARP Implementation ...... 80 8.4 Post Implementation Evaluation...... 80 8.5 LARP Implementation Time Schedule ...... 80 9 Costs AND FINANCING ...... 83

Page 4 || 132 9.1 General ...... 83 9.2 Itemized Budgets ...... 83 9.2.1 Compensation for Land ...... 83 9.2.2 Land Registration Fees ...... 84 9.2.3 Compensation for Structures ...... 85 9.2.4 Compensation for Annual Crops ...... 86 9.2.5 Compensation for Trees ...... 87 9.2.6 Resettlement Allowances ...... 88 9.3 LARP Management Cost ...... 88 9.3 Summary LAR Cost and Flow of Funds ...... 89 9.5 Justification of Cost Estimates and Updating LAR Budget ...... 89 9.6 Source of Financing ...... 90 10 MONITORING AND REPORTING ...... 91 10.1 Introduction...... 91 10.2 Monitoring and Evaluation Indicators ...... 91 10.3 Level of Monitoring ...... 91 10.4 Internal Monitoring...... 91 10.5 External Monitoring ...... 92 10.5.1 EMA Tasks ...... 92 10.5.2 Post-Implementation Evaluation ...... 93 10.5.3 Monitoring Indicators for Task 2 ...... 94 Annexes ...... 96 Annex 1 Valuation Methods, Valuation of Losses and Compensations ...... 97 Annex 2 ...... 101 Information Leaflet Distributed During the Public Consultation Meetings Conducted in 2018 Under the WB Procedures ...... 101 Land Acquisition and Resettlement Policy ...... 101 Annex 3 Consultation Meetings on Resettlement Matters Project-Affected People ...... 119

Page 5 || 132 GLOSSARY

Affected Person (AP): Individuals affected by Project-related impacts.

Affected Household (AH): All members of a household residing under one roof and operating as a single economic unit, who are adversely affected by the Project. It may consist of a single nuclear family or an extended family group.

Beneficiary Community: All persons and households situated within the government-owned or acquired property who voluntarily seek to avail and be part of the Project and represented by a community association that is duly recognized by the community residents, accredited by the local government, and legally registered with the appropriate institutions.

Compensation: Payment in cash or in kind of the replacement cost of the acquired assets.

Entitlement: Range of measures comprising compensation, income restoration, transfer assistance, income substitution, and relocation which are due to Affected people, depending on the nature of their losses, to restore their economic and social base.

Improvements: Structures constructed (dwelling unit, fence, waiting sheds, animal pens, utilities, community facilities, stores, warehouses, etc.) and crops/plants planted by the person, household, institution, or organization.

Land Acquisition: The process whereby a person is compelled by a government agency to alienate all or part of the land a person owns or possesses to the ownership and possession of the government agency for public purpose in return for a consideration.

Legitimate Possessors: Persons who have titles to their properties or are registered as the owners of private property in the NAPR.

Rehabilitation: Compensatory measures provided under the Policy Framework on involuntary resettlement other than payment of the replacement cost of acquired assets.

Relocation: The physical relocation of a AP/AH from her/his pre-Project place of residence.

Replacement Cost: The value determined to be fair compensation for land based on its productive potential and location. The replacement cost of houses and structures (current fair market price of building materials and labour without depreciation or deductions for salvaged building material), and the market value of residential land, crops, trees, and other commodities.

Resettlement: All measures taken to mitigate any and all adverse impacts of the Project on AP’s property and/or livelihood, including compensation, relocation (where relevant), and rehabilitation of the damaged/removed infrastructure and installations.

Sakrebulo: This is the representative body of local self-government. The middle level of local government consists of 67 rayons (districts) and six cities in Georgia: Tbilisi, Kutaisi, Rustavi, Poti, Batumi and Sukhumi. The representative branch of rayon level is the rayon level Local Councils (Rayon Sakrebulo) and the executive branch is represented by Rayon Gamgeoba (Gamgebeli). The self-government level consists of settlements (self-governed cities) or

Page 6 || 132 groups of settlements (municipalities). Settlements could be villages, small towns (minimum 3,000 inhabitants) and cities (minimum 5,000 inhabitants). The representative and executive branches of self-government are represented accordingly by Local Council (Sakrebulo) and the Gamgebeli of municipal level. The exclusive responsibilities of self-government include land-use and territorial planning, zoning, construction permits and supervision, housing, and communal infrastructure development.

Severely Affected: Households (including informal settlers) that are physically displaced, or who lose 10% or more of their income generating land as a result of project-related land acquisition.

Vulnerable Groups: People who by virtue of gender, ethnicity, age, physical or mental disability, Economic disadvantage, or social status may be more adversely affected by resettlement than others and who may be limited in their ability to claim or take advantage of resettlement assistance and related development benefits.

Page 7 || 132 EXECUTIVE SUMMARY

1. Tbilisi-Bakurtsikhe-Lagodekhi international road (S-5) connects Tbilisi with Lagodekhi city, the state border with Azerbaijan, as well as with the towns of Kakheti region. The traffic and road safety problems, as well as environmental impacts (noise, vibration, emissions) are significant particularly on Bakurtsikhe-Tsnori section of this road, where the currently existing alignment runs through the villages of Bakurtsikhe, Kardenakhi, Anaga and Vakiri. Vibration caused by large heavily loaded trailers conveying cargo from Turkey to Azerbaijan often causes damages to roads and roadside residential dwellings. The road technical standards are not met and there is no way for their improvement without substantial demolition of the existing infrastructure (houses, plots, etc.).

1) The Roads Department (RD) of the Republic of Georgia is planning to construct a new road in the Tbilisi-Bakurtsikhe-Lagodekhi international road: Bakurtsikhe-Tsnori section (15.6 km). The project consists of building a new road bypassing the densely populated villages along the existing road. Feasibility Study for the project has been prepared by Kocks Consult GmbH in August 2018 under the WB financing. Within this Feasibility Study Kocks Consult GmbH has prepared the Resettlement Action Plan (RAP) in WB format. The RAP is approved by the WB and RD MRDI in June 2019. At present, the project is proposed for ADB financing. The executing agency for the project will be the Ministry of Regional Development and Infrastructure (MRDI) and the Implementing Agency will be MRDI's Roads Department (RD). MRDI will be the Employer for the civil works contracts. The Final Draft Resettlement Action Plan for Bakurtsikhe-Tsnori (16 km) road section prepared by Kocks Consult GmbH in August 2018 covers only the main alignment of the designed new Bakurtsikhe-Tsnori road and does not address the minor component of the project related to the secondary road near the village Vakiri. At present only the conceptual design of this secondary road reflected in the Feasibility Study is available. The detailed design for this component is not yet prepared; The Resettlement Consultant proposes that separate Addendum to the main LARP is developed for the secondary road, when the detailed design is prepared and related impacts could be analysed. Additional public consultations meetings and individual consultations are needed for the AHs affected by the secondary road component of the project.

2) The existing RAP prepared by Kocks Consultant GmBH under the Feasibility Study and approved by WB and RDMRDI in June 2019 requires substantial update to develop the ADB compliant final, implementation ready LARP.

3) For the LARP update following additional field works was necessary to cover the issues missed in original RAP:

. Inventory of the grape trees to be cut within the supporting corridors along the residual parts of affected vineyards . Inventory of affected fruit trees planted outside the private plots

. Following this advice of the international social safeguards (resettlement) specialist, the required additional field works have been conducted by RD Consultant’s survey team (Kocks Consultant GmBH) in May-June 2019.

This LARP was prepared by RD MRDI under the assistance of the international social safeguards (resettlement) specialist hired by ADB and is final. It includes the recent updates

Page 8 || 132 and is based on detailed design and the requirements of the ADB Safeguards Policies (2009). Its objective is to plan and implement LAR for the Bakurtsikhe-Tsnori (16 km) road section. The LARP has been prepared through update of the factual data presented in initial RAP, revision of certain approaches used during the RAP preparation and restructuring the document in compliance with the SPS 2009

2. Impacts along these road sections will entail acquisition 705,735 sq.m of land from 916 plots, including 899 private plots and 17 public land plots. Private plots will be compensated while public plots will not. Of the total private land 891 have status of agricultural (arable) land (647,932 sq.m) and they are actually used for crop cultivation, tree planting or other agricultural needs. 5 land plots (9,440 sq.m) have status of agricultural (residential) land, although they are not currently used for residential or agricultural needs. Abandoned houses are located on these plots. Three land plots (3,123 sqm) have commercial-agricultural status and are used for nursery of plant saplings. The project has impact on 720 AH (1787 individuals). All of these mentioned 720 AH are losing land. Only three AH lose their buildings that are not used as residential (abandoned old houses and ancillary buildings). No physical relocation is planned under this LARP. There are no AH losing business, employment and other sources of income. The total number of affected trees is equal to 131,524. Total number of affected grape-trees is 119,621. No agricultural tenants or businesses will be affected. 615 AHs are deemed as severely affected AH (households losing > 10% of their income or productive land) and 28 AHs are recognized as the vulnerable AH (poor and women headed AHs). Given these impacts the project under this LARP is classified as “A” for resettlement.

Table E. 1 Summary Impact on Land Acquisition and Resettlement

Page 9 || 132 No. Description Unit Number sq.m 2,780 13 No 27 Area under garlic sq.m 22,510 14 No 6 Area under tomato sq.m 2,706 15 No 12 Area under pepper sq.m 13,702 16 No 2 Area under cucumber sq.m 1.350 17 No 12 Area under maize sq.m 8,976 18 No 8 Area under mixed veggies sq.m 13,970 19 No 16 Area under strawberries sq.m 8,488 Affected Perennials 20 Land parcels with affected grapes plants No 347 21 Total of affected grape plants (including standing saplings) No 119,621 22 Land parcels with affected fruit bearing trees No 696 23 Total of affected fruit bearing trees (including standing saplings) No 6,911 24 Land parcels with affected raspberry bushes No 1 25 Total of affected raspberry bushes No 520 26 Land parcels with affected saplings nursery No 3 27 Total of affected saplings No 4,467 28 Total of affected trees No 131,524 Affected Structures Residential Houses No 10 28 Vacated residential houses built of stone and bricks No 3 29 Auxiliary structures attached to affected rural residential land parcels No 3 Minor developments 30 Simple sheds standing in the agricultural land parcels built of wooden No 50 and metal poles with asbestos roofing 31 Concrete vessel used for treatment grape plants No 59 32 Clay vessel for wine storage No 4 33 Agricultural land parcels with minor developments, such as fences No 13 made of wooden/metal poles, latrine, iron gates, etc. Affected Households 34 Total of affected households No. 720 35 Total of affected persons No 1787 36 Male affected No 900 37 Females affected No 887 38 Severely affected Households No. 615 39 Vulnerable Households No 28 40 Resettled households No. 0 41 Number of AHs losing arable agricultural land parcels used for No 717 agricultural purposes 42 Number of AHs losing residential land parcels attached with vacated No. 3 residential dwellings 43 Number of AH losing agricultural land parcel used as sapling nursery No 1

3. The project impact extends to 1787 APs comprising 900 (50.4%) male and 887 (49.6%) females. Further, 18 of the 720 AHs are headed by women. Special attention will be

Page 10 || 132 given to the impact of resettlement on women and other vulnerable groups during monitoring and evaluation of the LARP. The project will have a positive impact on gender, and civil works contracts will include provisions to encourage employment of women during implementation. Additionally, women headed households have been considered as vulnerable and special assistance was provided in the LARP entitlements. The project will primarily affect Georgian people which are 100% of the total APs. Some of the other Ethnic Minority group is also present in the project area, which are insignificant in number and are not under the project impacts. These groups are fully integrated into the Country institutional, cultural, and economic processes, and they do not fit the IP definition of ADB. Therefore, ADB’s policy on indigenous people will not trigger to this project.

4. The legal and policy framework of the project on land acquisition and resettlement has been adopted to assist the APs and/or households for their lost land and assets, income and livelihood resources. Expropriation of land through eminent domain will not be applied unless approach for acquisition through negotiated settlement fails. Compensation eligibility is limited by a cut-off date as set for this project on the day of the beginning of the AP Census which is 1 December of 2017. APs will be entitled for compensation or at least rehabilitation assistance under the Project are (i) all persons losing land irrespective of their title, (ii) tenants and sharecroppers irrespective of formal registration, (iii) owners of buildings, crops, plants, or other objects attached to the land; and (iv) persons losing business, income, and salaries. However, this LARP identified no impact on tenants, sharecroppers, businesses, trees, crops, income or salaries. A summary entitlements matrix is included in Table E-2.

Table E.2 Compensation Entitlement Matrix

Type of Application Definition of AP Compensation Entitlements Impact Permanent All land losses APs APs will receive cash compensation loss of all independent from (with fully calculated at full replacement cost at types of land impact severity registered title) current market value1. (arable, Method for calculation of full residential, replacement cost besides the value of industrial, affected asset also includes cost of commercial) preparation of the land to levels similar to those of the affected land. AHs will be free of taxes, land parcel sub-division and transaction registration costs. The taxes and fee related to processing transaction registration will be covered by the Executing Agency.

If any remaining part of the land owned by the registered owners is no longer appropriate for use, such remaining part will also be purchased subject to the agreement with the owner.

1 Detailed description of replacement cost at current market value is described in the Section: Methodology for valuation and determination of unit rates.

Page 11 || 132 Type of Application Definition of AP Compensation Entitlements Impact Residual Land (so All APs holding If any remaining part of the land called “Orphan land title owned by the registered owners is no land“) longer be appropriately used, such remaining part will also be purchased subject to the agreement with the owner. Cash compensation will be calculated as usual at full replacement cost at current market value as applicable to the cases of permanent loss of land for title holders/legitimate possessors.

All APs holding APs who use more APs who possess captured land will excess (surplus) area then allocated not be cash compensated, unless land2 under title registered in the NAPR according to documents the decision of land legalization commission. However, any loss of annual crops and other improvements will be cash compensated in cash at full market rate for annual harvest to be paid to land-user. APs (possessors of Assistance to APs in the process of legalizable land legalization of project affected land parcel) parcel being under their possession. Once legalization and registration of ownership title is accomplished, land acquisition will be undertaken, and AP will receive cash compensation at full replacement cost at current market value at unit rate proposed in approved LARP. Non-titled, non- APs who due to These APs in addition to cash legalizable land lost official records compensation for all affected assets users; turn out to be fully except land will receive one-time APs identified as deprived from allowance in the amount of 6 months De-facto land eligibility to obtain subsistence income for the family of possessors without ownership title to a five members.3 any legal document land parcel being originating the used, cultivated for ownership right (no decades without documents found in any disputes or the State Archive, claims raised by neither found in the the owners of the land tax payer’s list adjacent land recorder with Tax parcels Department under the MOF of Georgia. Leaseholder of Free of charge renewal of lease in private or public other plots of equal value/productivity lands of affected land parcel or Cash

2 Excess (surplus) land refers to the cases when AP uses more area of land than as shown in documents originating land ownership rights. Such cases will be transferred for the review and approval /rejection of local land legalization commission prior to updating the registration. 3 http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. Minimum monthly income subsistence level for the household of 5 members is 378.90 GEL. In particular: 379 X 6= 2,274 GEL per vulnerable household.

Page 12 || 132 Type of Application Definition of AP Compensation Entitlements Impact compensation equivalent to market value of gross yield of affected land for the remaining lease years (up to a maximum of 3 years). Plus, cash compensation to reimburse the proven investments incurred by the Leaseholder to improve the leased land. Leaseholder Cash compensation equivalent to (not registered) market value of gross yield of affected land for the remaining lease years (up to a maximum of 3 years). Squatters One-time rehabilitation allowance equal to market value of 1 year gross harvest (in addition to crop compensation) for land use loss. Permanent Local community Affected community will be free of loss of losing access to charge allocated replacement land of community pasture, grazing similar size, productivity, and location land land acceptable to affected community by (pastures, the local government. grazing land) If such replacement is not possible, Livelihood Restoration Plan will be prepared and implemented to address the needs of affected community and preserve their livelihood at least similar to pre- project level. Structures Residential Project affected APs with registered All impacts will be considered as full houses and residential ownership title; impacts disregarding the actual impact structures dwellings and other APs declared as percentage. Impacts will be structures subject legitimate compensated in cash at full to partial/full possessors replacement costs calculated at demolition replacement cost of project affected structures and fixed assets free of depreciation, without deducting cost for salvaged materials and transaction costs.

Residential One-time allowance equals monthly tenants/renters rental fee (specified in the lease agreement) multiplied by 34; if Lease agreement is not available, minimum monthly salary multiplied by 35. In addition, one-time technical assistance for transportation personal belongings to a new location; or one-time cash allowance to cover costs for transportation personal belongings in the maximum amount of 300 GEL/PAH.

4 If there are cases where the tenant/renter has paid rent in advance for a longer period of time, he owner will be requested to reimburse the money to the tenant/renter for the corresponding period if adequate evidence is available. 5 If there are cases where the tenant/renter has paid rent in advance for a longer period of time, the landlord will be requested to reimburse the money to the tenant/renter for the corresponding period if adequate evidence is available.

Page 13 || 132 Type of Application Definition of AP Compensation Entitlements Impact Commercial Project affected Titleholder Cash compensation at replacement structure commercial cost calculated for project affected facilities subject to structure and other fixed assets free partial/full of salvageable materials, demolition depreciation and transaction costs. If partial demolition threats deterioration of structure or raises safety and security concerns the cash compensation will apply to the entire building and affixed assets. Tenant of One-time allowance equal to monthly commercial facility rental fee (specified in the lease agreement) multiplied by 3; if Lease agreement is not available, minimum monthly salary multiplied by 3. Solid Walls All APs with solid All APs Cash compensation at replacement walls to be affected (construction) cost according to the material and linear meter length of affected fence/wall. Light and/or All APs with affected Cash compensation will be issued to iron meshed agricultural land APs for replacement of light or iron fences and parcels meshed fences and access gates, access gates according to the unit rates determined in the RAP. Annual Crops Crops affected All APs (including Crop compensation in cash at gross squatters) market value of actual or expected harvest. Compensation for this item will be provided even in case if the crops were harvested. Perennials Project affected All PAPs (including Cash compensation at market value standing on Fruit bearing squatters) on the basis of type, age, and private land perennials productive value of fruit tree; Each parcels fruit bearing tree in addition shall be compensated for purchase of saplings6. PAPs will be eligible to dispose logged trees themselves. Construction company ensures free logging and delivery of timber to the residence of PAPs. Project affected All PAPs (including No cash compensation will be issued non-fruit bearing squatters) for perennials not bearing fruits. perennials PAPs will be eligible to dispose logged trees themselves. Construction Company ensures free logging and delivery of timber to the residence of PAPs. Perennials Standing trees Perennials standing Construction Company will deliver (on outside of private logged down trees and transfer to the public/State land Municipality. Municipality may later land) distribute to local population below poverty levels. Perennials Standing non fruit Perennials standing The legal implementation of the standing on the trees outside of private mentioned activity requires, that forestry land land Perennials standing on the forestry

6 Valuation methodology for trees is described in Annex 1.

Page 14 || 132 Type of Application Definition of AP Compensation Entitlements Impact land must be delisted from the State forest fund in accordance with the corresponding Decrees of Government of Georgia Construction Company will deliver logged down trees and transfer to the Municipality. Municipality may later distribute to local population below poverty levels. Income loss Lessors/landlo Loss of income All APs holding One-time allowance equal to annual rds through termination lease/rental rental fee (specified in the lease of Lease agreement agreement); agreements If Lease agreement is not available, subsistence minimum7 multiplied by 12. Impact of Temporary or All APs (including Business owner: (i) Cash business, permanent squatters) compensation equal to one-year business loss of income, if loss is permanent; (ii) cash owners and business or compensation for the period of Employment employment business interruption, if loss is temporary.

Compensation is calculated based on tax declarations. In cases where tax declaration reports are unavailable, or when the monthly income is less than monthly subsistence minimum, then official subsistence minimum8 is taken as a basis and this figure is multiplied by 12 months (permanent impact) or by number of months of business interruption (temporary impact). Worker/employees: Indemnity for lost wages for the period of business interruption. In case of permanent stoppage of the business, the employees will receive Indemnity for lost wages for 1 year. In cases where tax declaration reports are unavailable, or when the monthly salary is less than monthly subsistence minimum, then official subsistence minimum multiplied to the number of months of actual stoppage of business is paid or multiplied to 12 months in case of permanent loss of job. Agricultural Cash indemnity corresponding to their workers losing their salary for the remaining part of the contract agricultural year, and where needed livelihood restoration measures. Additional Rehabilitation Measures

7 In some cases, the APs may be reimbursed transaction related costs they incurred for road project purposes (e.g. VAT, Income Tax, Court/Notary fees and Court costs. 8 Same as above.

Page 15 || 132 Type of Application Definition of AP Compensation Entitlements Impact Technical All PAPs with Free of charge technical assistance to assistance in registered APs during legalization, sub-division legalization, title/possessors of of project affected parcel, registration registration legalizable land of corrections and/or sales procedures parcels transaction. Project related State taxes, official fees and transactions costs if not waived will be covered by the GOG9. Relocation Transport and All PAPs affected Provision of sufficient allowance to transitional by relocation cover transport expenses and livelihood livelihood expenses for three months. allowances For this project the Relocation Allowance is fixed as 300 Gel.

9 In some cases, the APs may be reimbursed transaction related costs they incurred for road project purposes (e.g. VAT, Income Tax, Court/Notary fees, and Court costs. 10 The amount of minimum monthly subsistence income level for the family of five members obtained from the official website of the Department of Statistics for July 2018; In particular: 341.90 X 3=1,025.70 GEL. Source: http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. The latest data (May 2019) provides higher rates: 378.9 Gel per the family consisting of 5 persons. 379 x 3 = 1,137 GEL 11 The amount of minimum monthly subsistence income level for the family of five members obtained from the official website of the Department of Statistics for July 2018; In particular: 341.90 X 3=1,025.70 GEL. Source: http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. The latest data (May 2019) provides higher rates: 378.9 Gel per the family consisting of 5 persons. 379 x 3 = 1,137 GEL

Page 16 || 132 Type of Application Definition of AP Compensation Entitlements Impact of compensation entitlements provided under this RPF and relevant RAP. Avoidance of Business units Temporary access will be set up by interruption of Construction Company. temporary access road to the business activity Temporary loss of Owners/users During camps' site selection process income caused by Construction Company should occupying land coordinate with relevant state parcels for the agencies and give priority to vacant camps and quarries lands not used for agricultural /residential purposes. But in case the land parcels selected for camps and quarries will have private land-users, all losses and amount of due compensation shall be determined according to the principles of compensation entitlements provided under this LARP. Any other As required Any Road Department and the unforeseen Construction Contractor will address Impacts and mitigate /compensate unforeseen resettlement impact during project implementation period.

5. ADB is the funding agency and RDMRDI is the Implementing Agency (IA) of the Project. RDMRDI has the lead responsibility for road construction, as well as implementation of this LARP through the Resettlement Division (RDRD) under the RDMRDI. A Land Acquisition and Resettlement (LAR) Commission (LARC) will be assisting RDRD in all LAR activities and RDRD will be represented at the field by a Working Group comprising the legal, economics and engineering expertise from other departments of RDMRDI. In addition, RDRD will be assisted by LAR Team in the rayon level involving also the local self-government bodies. EuroAsian Transport Corridor Investment Center (ETCIC) has been formed as an independent body for financial management of World Bank and ADB financed projects. In addition, a number of other government departments will play an instrumental in the updating and implementation of LARP. The National Agency of Public Registry (NAPR) within the Ministry of Justice will be assisting the Project through registration of land ownership and its transfer through purchase agreement from landowners to the RDMRDI. The local government at Rayon and village level will also be involved.

6. A grievance mechanism will be available to allow a AP appealing any disagreeable decision, practice or activity arising from land or other assets compensation. Local Grievance Redress Mechanism (LGRM) at local level involving the local government officials, representative of APs, RDMRDI, CW Contractor and Engineer (CSC). APs will be fully informed of their rights and of the procedures for addressing complaints whether verbally or in writing during consultation, survey, and time of compensation. Care will always be taken to prevent grievances rather than going through a redress process.

7. Consultation with likely APs in the project affected areas was conducted under the WB RAP procedures study and mainly during the preparation of LARP in November – Luly of 2018.

Page 17 || 132 Additional consultations have been conducted in 2019. Specific to the section of the LARP, people were consulted through individual contact during the census survey under the feasibility study for identification of APs. Public consultation meeting has been conducted in January 2019.

8. LARP may require legalization of the 31 legalizable owners of land parcels under acquisition which is in progress and negotiation with all legalized land owners and APs will start by July 2019. Payment of compensation and cash allowances will be completed by end of October 2019. All activities related to the land acquisition and resettlement have been scheduled to ensure that compensation is paid prior to displacement and commencement of civil works. Public consultation, internal monitoring and grievance redress will be undertaken intermittently throughout the project duration. The resettlement cost estimate under this LARP is 14,929,062 GEL (USD 5,356,678)

9. Land acquisition and resettlement tasks under the project will be subject to monitoring. Monitoring will be the responsibility of RDMRDI. Internal monitoring will be carried out routinely by RDRD/RDMRDI. The results will be communicated to ADB through the quarterly project implementation reports. External monitoring will be carried out on a regular basis, and its results communicated to RDRD/RDMRDI and ADB through quarterly reports. The RDMRDI (through external help) will carry out a post-implementation evaluation of the LARP about a year after completion of its implementation.

Page 18 || 132

1 INTRODUCTION

1.1 Project Background

2. The Roads Department (RD) of the Republic of Georgia is planning to construct a new road in the Tbilisi-Bakurtsikhe-Lagodekhi international road: Bakurtsikhe-Tsnori section (15.6 km). The project consists of building a new road bypassing the densely populated villages along the existing road. Feasibility Study for the project has been prepared by Kocks Consult GmbH in August 2018 under the WB financing. Within this Feasibility Study Kocks Consult GmbH has prepared the Resettlement Action Plan (RAP) in WB format. The RAP is approved by the WB and RD MRDI in June 2019.

3. At present, the project is proposed for ADB financing. The executing agency for the project will be the Ministry of Regional Development and Infrastructure (MRDI) and the Implementing Agency will be MRDI's Roads Department (RD). MRDI will be the Employer for the civil works contracts.

4. An international social safeguards (resettlement) specialist has been engaged by ADB to carry out due diligence on the new project road. This output will include preparing safeguards documentation for social aspects of the project consistent with ADB's Safeguards Policy Statement 2009. The resettlement specialist has reviewed the RAP and supplementary technical documents and conducted field works to assess compliance of the RAP with SPS 2009. The results of this due diligence assessment is summarised as following conclusions:

4) The Final Draft Resettlement Action Plan for Bakurtsikhe-Tsnori (16 km) road section prepared by Kocks Consult GmbH in August 2018 covers only the main alignment of the designed new Bakurtsikhe-Tsnori road and does not address the minor component of the project related to the secondary road near the village Vakiri. At present only the conceptual design of this secondary road reflected in the Feasibility Study is available. The detailed design for this component is not yet prepared; The Resettlement Consultant proposes that separate Addendum to the main LARP is developed for the secondary road, when the detailed design is prepared and related impacts could be analysed. Additional public consultations meetings and individual consultations are needed for the AHs affected by the secondary road component of the project.

Page 19 || 132

5) The existing RAP prepared by Kocks Consultant GmBH under the Feasibility Study and approved by WB and RDMRDI in June 2019 requires substantial update to develop the ADB compliant final, implementation ready LARP.

6) For the LARP update following additional field works are necessary to cover the issues missed in RAP:

. Inventory of the grape trees to be cut within the supporting corridors along the residual parts of affected vineyards . Inventory of affected fruit trees planted outside the private plots

5. Following this advice of the international social safeguards (resettlement) specialist, the required additional field works have been conducted by RD Consultant’s survey team (Kocks Consultant GmBH) in May-June 2019, although the results of this survey are not reflected in the RAP approved by WB.

6. This LARP was prepared by RD MRDI under the assistance of the international social safeguards (resettlement) specialist hired by ADB and is final. It includes the recent updates and is based on detailed design and the requirements of the ADB Safeguards Policies (2009). Its objective is to plan and implement LAR for the Bakurtsikhe-Tsnori (16 km) road section. The LARP has been prepared through update of the factual data presented in initial RAP, revision of certain approaches used during the RAP preparation and restructuring the document in compliance with the SPS 2009.

7. Impacts along these road sections will entail acquisition 705,735 sq.m of land from 916 plots, including 899 private plots and 17 public land plots. Private plots will be compensated while public plots will not. Of the total private land 891 have status of agricultural (arable) land (647,932 sq.m) and they are actually used for crop cultivation, tree planting or other agricultural needs. 5 land plots (9,440 sq.m) have status of agricultural (residential) land, although they are not currently used for residential or agricultural needs. Abandoned houses are located on these plots. Three land plots (3,123 sqm) have commercial-agricultural status and are used for nursery of plant saplings. The project has impact on 720 AH (1787 individuals). All of these mentioned 720 AH are losing land. Only three AH lose their buildings that are not used as residential (abandoned old houses and ancillary buildings). No physical relocation is planned under this LARP. There are no AH losing business, employment and other sources of income. The total number of affected trees is equal to 131,524. Total number of affected grape-trees is 119,621. No agricultural tenants or businesses will be affected. 615 AHs are deemed as severely affected AH (households losing > 10% of their income or productive land) and 28 AHs are recognized as the vulnerable AH (poor and women headed AHs). Given these impacts the project under this LARP is classified as “A” for resettlement.12

12 Based on the ADB Safeguards Policy Update (2009) a Project is classified as A for LAR when it entails severe impacts (> 200 persons lose >10% of their income or are resettled). For category A projects a full LARP is to be prepared.

Page 20 || 132 1.2 Minimizing Land Acquisition and Resettlement

8. Due considerations have been given during the alignment selection and engineering design to minimize the adverse impacts of land acquisition and involuntary resettlement. Efforts have been put to incorporate best engineering solution in avoiding large scale land acquisition and resettlement. Following are the specific measures adopted for the selection of the route:

(i) The road alignment route has been well tuned on site to avoid densely settlement areas;

(ii) Interchanges with local roads have been designed to avoid resettlement

(iii) Designs of interchanges were reviewed by resettlement specialists and their recommendations were considered in the final design.

1.3 LARP Preparation

9. This LARP is final and has been prepared as a condition to contract awards signing. The document complies with relevant Georgian laws and the ADB’s Safeguard Policy Statement (2009). LARP preparation entailed: (i) a detailed measurement surveys (DMS), (ii) a detailed asset valuation/documentary research for each affected plot/affected item, (iii) a 100% AH census; and (iv) a socio-economic survey (SES) of more than 96.55 % of the AHs. Intensive consultations with all the stakeholders including rayon authorities and the likely APs (APs) were conducted during the process.

10. The initial RAP has been prepared under the WB regulations. The document complies with relevant Georgian laws and provision of the WB OP 4.12 on Involuntary Resettlement, as well as Resettlement Policy Frameworks developed and disclosed by RDMRDI for the Secondary Road Asset Management Project (SRAMP) partially financed by the WB. The initial RAP prepared under the WB financing was reviewed and compared with the findings of the International Safeguards Specialist. The document is based on a verified and partly corrected DMS, census and socioeconomic survey, which were conducted by Kocks Consultant GmBH December 2017 - January 2018. The start date of the DMS and the AP census survey is considered as the compensation eligibility cut-off date for the project which is therefore December 1, 2017. The updates and corrections were made upon the request of the International Safeguards Specialist during May – June 2019. The updates include Inventory of the grape trees to be cut within the supporting corridors along the residual parts of affected vineyards and inclusion of the related compensation amounts into the total LARP budget. The LARP is finalized to be compliant with the format and requirements of ADB SPS 2009.

11. The LARP entailed consultations with the stakeholders, especially the APs and their community. Consultations with the stakeholders have been conducted through joint meetings, individual contact at the time of census, socioeconomic survey and detail measurement survey during the period of November 2017 to July 2018. Consultations were conducted to understand the extent of impact and validate the severity and compensation measures. The

Page 21 || 132 assessment of losses and land acquisition is based on the final engineering design as part of the detailed design study.

1.4 Pending LARP Implementation Tasks

12. Following this LARP approval LARP finances will be provided to the EA. Prior to the distribution of LARP finances to the APs the legalization of legalizable AP now in progress will finalized and all APs will sign a contract agreement indicating that they accept the compensation provided to them. If an AP does not sign the contract the case will be passed to the appropriate court to initiate expropriation proceedings. This will be done after the compensation amount is deposited in escrow account. Escrow accounts will also be established for absentee APs.

1.5 Conditions for Project Implementation

13. Based on ADB policy/practice, the approval of project implementation will be based on the following LAR-related conditions:

(i) Signing of Contract Award: Conditional to the approval of the LARP by ADB and Government. LARP reflects final impacts, final AP lists and compensation rates at replacement cost approved by RD MRDI. (ii) Notice to Proceed to Contractors: Conditional to the full implementation of LARP (legalization of legalizable owners, and full delivery of compensation and rehabilitation allowances).

Page 22 || 132 2 CENSUS AND IMPACT ASSESSMENT

2.1 The Impacts Corridor and Affected Plots

14. The project road Bakurtsikhe-Tsnori is 16 km long and will detour from the densely populated villages and run through the arable agricultural land parcels that belong to the residents of six settlements of Gurjaani and Sighnaghi municipalities of Kakheti region: villages Bakurtsikhe and Kardanakhi of Gurjaani municipality and villages Vakiri, Anaga, Sakobo and city of Tsnori of Sighnaghi municipality.

Fig. 2-1. Map showing existing road and selected alignment for Bakurtsikhe-Tsnori 16 km bypass.

15. The total width of the road corridor is 13m. The road consists of the two lane carriageway and the shoulders. The selected design elements for the cross section of the project road are as follows: Number of lanes: 2 Lane width: 3.50 m Carriageway width: 7.00 m Width of paved shoulder: 2.50 m Total road width: 13.00 m

16. The resettlement impacts and inventory of losses have been estimated within this 13m width corridor. A detailed inventory of all the impacts has been done following the final alignment as per detailed engineering design.

Page 23 || 132 17. Digitized cadastral maps were collected from the NAPR. The final project impact buffers were superimposed on the digitized cadastral maps and land survey using DGPS was conducted on site to identify the affected land parcels, demarcation of land parcels including correction in geometric details and quantification of land parcels including affected part. With the cadastral details from land survey, detail measurement survey (DMS) and 100% AP Census were undertaken. The major part of field surveys were carried out during December 1, 2017 – January 31, 2018. The updates and corrections were made upon the request of the International Safeguards Specialist during May – June 2019

2.2 Impact on Land, Other Assets and Income

2.2.1 General Classification of affected land

18. In all land impacts amount to some 705,735 sq.m of land from 916 plots (see Table 2- 1 for details). Out of this, 17 plots are owned by state (45,240 sqm). 899 land plots are owned by 720 AHs (out of this 1 AH represents plant nursery family business). In terms of tenure the affected land plots are distributed in accordance with the following legal categories:

- Category 1. Titled private agricultural land plots with valid registration. 437 of the affected land plots (with aggregated area of 321,064 sq.m.) have valid registration.

- Category 2. 431 land plots of 316,655 sq.m have registration, however, NAPR recognizes that the registration documents should be updated to correct the geometrical parameters of these plots.

- Category 3. 31 plots (22,776sqm) are non-titled, but legalizable according to current legislation through 1 stage registration in NAPR. Some of the AHs possess related right establishing documents and some are available in Archives.

All of these mentioned 3 categories of land plots owned by 720 AHs are subject for compensation.

- Category 4. State Owned land plots illegally occupied by private users (squatters). In this sub-section of the road we do not have plots illegitimately occupied by squatters.

- Category 5. 17 State owned land plots of 45,240 sqm not used by private users. Most of State land plots are registered as land under the MoESD.

19. The land plots of type 1 and 2 are both registered as private property. The 437 plots of category 1 are finally verified and the registration parameters are valid. The ownership status of the 431 category 2 plots, according to NAPR explanations, is not under the doubt, but the configuration, precise location and other geometrical parameters need to be specified and the registration documents and drawings should be updated accordingly.

20. Category 4 and 5 land parcels are not subject for compensation. There are no public land plots in the affected area used by leaseholders. The aggregated figures according to land tenure categories are provided in a Table 2.1.

Page 24 || 132 21. The land costs and compensation categories within the project area are fully determined by the land use status, as the location and physical and productivity characteristics of the affected plots are very similar. Figures on Land impacts are provided in accordance to the land classification and legal categories that are relevant to determine compensation rates and amounts due to their use modalities. The affected land for this sub-section of the road has been classified in 5main types:

• Type 1 Agricultural (arable) land. (3.5 GEL/sq.m). The land plots of official agricultural/arable status according to NAPR registration. In total there are 891 affected land plots of type 1 with aggregated area 647,932 sq.m

• Type 2: Agricultural (residential) land (5. 0 GEL/sqm). The land plots of official agricultural/residential status according to NAPR registration (in rural areas most of residential land plots have official status of agricultural/residential). 5 land plots of type 2 (9,440 sq.m.) owned by 3 AHs are affected by the project. The land plots of type 3 affected by the project are not actually used for residential needs. Only old, abandoned residential dwelling are located on these plots.

• Type 3: Agricultural land used for commercial purposes (nursery for decorative perennials/ 7.0 GEL/sqm). There are 3 land plots of type 3 (3,123 sqm) owned by one AH that is affected under this RAP.

• Type 4: State Owned land plots illegally occupied by private users (squatters). In this sub-section of the road we do not have land plots occupied by the squatters.

• Type 5: State Owned land plots – 17 State owned land plots of 45,240 sqm not used by private users. Most of State land plots are registered as land under the MoESD.

22. The aggregated figures for the land parcels of different types by land use and compensation rates are given below in Table 2-2.

Table 2-1 Type of Land Ownership

Tenure Categories Plots No. Area (sqm) AHs Compensable land Compensable land Category 1. Private with valid Registration 437 321,064 347* Category 2. Land parcels undergoing title 431 316,655 342** registration update at the NAPR 31 Category 3. Private Legalizable 22,776 31

Subtotal Compensable 899 660,495 720

Non-Compensable land

Category 4. State Owned, Used by Private Users 0 0 0 (squatters) – Non Legalizable

Page 25 || 132 Tenure Categories Plots No. Area (sqm) AHs

Category 5. State Owned Not Used by Private Users 17 45,240 0

Subtotal Non-compensable 17 45,240

916 705,735 720 TOTAL

* Several AH loses 2 land plots of category 1. ** Several AH loses 2 land plots of category 2.

Table 2-2 Type of Land Use and Land Groups by Compensation Rates

Categories by Land Use and Costs Plots No. Area (sqm) AHs

Compensable land

Type 1. Agricultural (arable) land. (3.5 GEL/sqm). 891 647,932 717* The land plots of official agricultural/arable status according to NAPR registration

Type 2. Agricultural (residential) land (5.0 GEL/sqm). 5 9,440 3** The land plots of official agricultural/residential status according to NAPR registration (in rural areas most of residential land plots have official status of agricultural/residential); The land plots with old, abandoned residential dwellings. 3 3,123 1*** Type 3. Agricultural land used for commercial purposes (nursery for decorative perennials/ 7.0 GEL/sqm)

Subtotal Compensable 899 660,495 720****

Non-Compensable land Type 4 State Owned, Used by Private Users – Non 0 0 0 Legalizable

Type 5 State Owned Not Used by Private Users 17 45,240

Subtotal Non-compensable 17 45,240

TOTAL 916 705,735 720 * Several AH loses 2 land plots of category 1. ** 2 AHs lose 2 land plots each of category 2. *** 1 AH loses 3 land plots used as tree nursery. *** 1 AH loses land in different categories.

2.2.2 Impact on Crops

23. Annual crops are cultivated in total on 94,269sqm of agricultural land. Affected crops identified on the acquired agricultural land are vegetables, maize, beans, potato and strawberries. The largest portion of the agricultural land is used for cultivation of garlic – 22,510

Page 26 || 132 sq.m. (2.25ha), beans 15,570 sq.m (1.55 ha), maize 8,976sq.m (0.9ha) and strawberries 8,488 sq.m (0,84ha). The total figures are given in Table 2.3.

Table 2.3 Summary of Affected Annual Crops

Compensation No of Units Type of Annual Unit Unit Rate crop measure (GEL) (sq.m.)

Potato 1.6 Kg/sq.m. 5,567

Bean 0.7 Kg/sq.m. 15,570

Garlic 1.8 Kg/sq.m. 22,510

Tomato 1.6 Kg/sq.m. 2,706

Maize 0.4 Kg/sq.m. 8,976

Strawberry 1.2 Kg/sq.m. 8,488

Pepper 1 Kg/sq.m. 13,702

Anion 0.8 Kg/sq.m. 2,780

Other mixed 0.5 Kg/sq.m. 13,970 veggies

Total 94,269

Source: Appraisal report prepared by the licensed appraiser for the given.

2.2.3 Impact on Trees

24. Clearing right of way will cause felling down of 131,524 productive fruit trees, raspberry bushes and commercially grown saplings under private ownership. Most significant part of tree impact is related to wine grape-trees. The affected timber trees are mostly state owned and are not included in the inventory list. The timber trees that will be felled at the private land plots will be passed in a possession of the owners: they may use it as timber material or sell it. In general, loss of timber trees including the state owned trees will induce some impact on

Page 27 || 132 wind belt and greenery plantations and counter program of replanting may be suggested within the EIA.

Non-Fruit Bearing Perennials

25. No cash compensation will be issued for perennials not bearing fruits. Construction Company ensures free logging and delivery of timber to the residence of APs.

Decorative Perennials grown for commercial purposes

26. Only one AH who owns three agricultural land parcel used for growing samplings of over-green perennials will be cash compensated in accordance to current market prices and personal financial records of AP.

Fruit - Bearing Perennials

27. Cash compensation at market value based on type, age, and productive value of fruit tree.

28. The details of the impacts on trees is given in the tables 2.4.

Table 2.4-1 Impact on Trees according to Initial RAP

Affected Perennials No of affected plants

Vine grapes (including saplings) 104,243

Fruit bearing trees (including saplings) 6,911

Raspberry bushes 520

Decorative tree saplings 4,467

Subtotal 116,146

29. In May-June 2019 additional inventory has been carried out to cover the affected grape trees located within the operational zone of the vineyards. This type of losses has been overlooked in the Initial RAP developed under the WB regulations and has been added to finalize the LARP in ADB format.

Page 28 || 132 Table 2.4-2: Additional Grape Tree Impacts within Operational Zone

Items Numbers of Items

Total number of private project affected land parcels 899 among them with standing grapes 448 among them: No of project affected land parcels to be fully acquired 140 among them: No of parcels eligible to additional cash compensation for standing grapes 308 without land acquisition among them: Grapes to be compensated is semi-productive age No of parcels 13 No of plants 583 Amount in GEL 17,490

Grapes to be compensated is full-productive age No of parcels 295 No of plants 14,795 Amount in GEL 1,035,650 Summary Figures Total of parcels eligible to additional cash compensation of grapes only, 308 no lad acquisition Total no of grapes to be compensated 15,378 Total amount of additional compensation in GEL 1,053,140

According to the data presented in tables 2.4-1 and 2.4-2, the total number of affected trees is equal to 131,524. Total number of affected grape-trees is 119,621.

2.2.4 Impact on Buildings/Structures

30. Major structures affected by the project include 3 old, abandoned residential houses owned by 3 households, two ancillary large structures and one storage. The mentioned houses are not used for residential needs and their demolition is not related to the physical relocation of the households. Apart from that, some minor supplementary structures, such as shelters in the vineyard, concrete vessels for vineyard treatment, Clay vessels buried in the soil used for wine storage, wire fences and concrete poles used for fixing the vine plants fall under the impact. The details of the impacts on structures is given in the Table 2.5.

Page 29 || 132

Table 2.5. Summary of Impacts on Structures

Affected Parcel Area No of residential Number Code (sq.m.) floors property Residential House, 640 120 1 1 supplementary structures

Residential 642 200 1 1 House Residential 641 37 1 1 House TOTAL 357 3

Affected Parcel Area No of residential Number Code (sq.m.) floors property supplementary 640 83 1 1 structures Supplementary 664 structure in 25 1 1 vineyard

682 Larger storage 8 1 1

TOTAL 116 3

Compensation Unit No of Units Supplementary Structures Unit Rate Measure

(GEL)

Shelter in vineyard 500 Number 50 Concrete vessel used for 300 Number 59 treatment grape plants Clay vessel for wine storage 1 GEL per liter + transportation 520 Number 4 cost Poles & wire for fixing single vine Plant 1 104,243 plants number Light / iron meshed fence 5 parcels 250

Other (cemented iron poles) 15 Number 15

Other (latrine) 300 Number 1

Other (metal gate) 250 Number 1

Page 30 || 132

2.2.5 Relocation Needs and Strategy

31. The three buildings that are subject for demolition are abandoned and not used for residential needs. Demolition of these two buildings is not related to physical relocation of AHs.

2.2.6 Business Impacts

32. The only business affected by the project is a family business focused on growing decorative plant saplings. This impact is estimated as impact on trees and is compensated at the market price of the affected trees. This loss will not affect the jobs of employees. Compensation of land, structures and trees covers all losses. LAR will not affect other businesses.

2.3 APs and Communities

33. In overall the project affects 720 AHs (1787 AP). Of these, 717 AH will lose arable agricultural land used for agricultural needs and three AHs will lose residential plots with abandoned, not used for residence houses. No AHs are physically relocated and losing their shelter. No AHs are losing businesses or jobs. 615 AHs are severely affected and 28 AHs are recognized as vulnerable.

2.3.1 Impact on Employment and Agricultural Tenants

34. Road construction will not affect any employees or agricultural tenants.

2.3.2 Impact on Common Property Resources

35. Road construction will not affect any community or public property.

2.3.3 Severely Affected and Vulnerable Households

36. There is no physical relocation or impacts on businesses, employment, or other sources of income of the AHs. However, a total of 615 AHs are deemed to be severely affected due to loss of more than 10% of their productive land.

37. Poor (receiving government subsidies or pensioners), women headed, and disabled or pensioner households without breadwinner are considered as vulnerable, those that require

Page 31 || 132 special assistance for resettlement. The AHs in this LARP section of the project road constitute 28 vulnerable AHs. These includes 18 women headed AHs (Table 2-6).

Table 2-6 Vulnerable AHs

Vulnerable Female HH IDP Below Disability Unattended Location AHs poverty elderly Tsnori 2 1 1 Sakobo 12 7 1 2 2 Vakiri 3 2 1 Anaga 5 4 1 Kardanakhi 3 3 Bakurtsikhe 3 1 1 1 Total 28 18 2 4 2 2

2.4 Impact on Indigenous Peoples

38. An assessment of impact on indigenous peoples was undertaken in accordance with ADB’s Safeguard Requirements 3 of SPS 2009. The project will primarily affect Georgian people which are 100% of the total APs. Some of the other Ethnic Minority group is also present in the project area, which are insignificant in number and are not under the project impacts. These groups are fully integrated into the Country institutional, cultural, and economic processes, and they do not fit the IP definition of ADB. Therefore, ADB’s policy on indigenous people will not trigger to this project.

2.5 Gender and Resettlement Impacts

39. The project impact extends to 1787 APs comprising 900 (50.4%) male and 887 (49.6%) females. Further, 18 of the 720 AHs are headed by women. Special attention will be given to the impact of resettlement on women and other vulnerable groups during monitoring and evaluation of the LARP. The project will have a positive impact on gender, and civil works contracts will include provisions to encourage employment of women during implementation. Additionally, women headed households have been considered as vulnerable and special assistance was provided in the LARP entitlements.

2.6 Summary of Impacts

40. A summary of the major impacts is included in Table 2-7 below.

Page 32 || 132

Table 2-7 Summary of Impacts

No. Description Unit Number Land Tenure Patterns 1 Total of project affected land parcels No. 916 Sq.m. 705,735 2 Total of State-owned land parcels No 17 Sq.m. 45,240 3 Total of project affected private land parcels No 899 Sq.m. 660,495 4 Category 1. Land parcels with updated registration at the NAPR 437 5 Category 2. Land parcels undergoing title registration update at the 431 NAPR 6 Category 3. Land parcels with landowners to be identified /confirmed 31 (possible need for legalization) Land Use and Compensation Categories 7 Type 1; Arable agricultural land used for agricultural purposes (3.50 No. 891 GEL/sq.m.) sq.m 647,932 8 Type 2; Rural residential land parcels attached with vacated residential No. 5 dwellings (5.00 GEL/sq.m). sq.m 9,440 9 Type 3. Agricultural land parcels used for saplings nursery (7.00 No. 3 GEL/sq.m.) sq.m 3,123 Agricultural Patterns Annual Crops No 7 10 Area under bean sq.m 15,570 No 6 11 Area under potato sq.m 5,567 No 3 12 Area under onion sq.m 2,780 No 27 13 Area under garlic sq.m 22,510 No 6 14 Area under tomato sq.m 2,706 No 12 15 Area under pepper sq.m 13,702 No 2 16 Area under cucumber sq.m 1.350 No 12 17 Area under maize sq.m 8,976 No 8 18 Area under mixed veggies sq.m 13,970 No 16 19 Area under strawberries sq.m 8,488 Affected Perennials 20 Land parcels with affected grapes plants No 347 21 Total of affected grape plants (including standing saplings) No 119,621 22 Land parcels with affected fruit bearing trees No 696 23 Total of affected fruit bearing trees (including standing saplings) No 6,911 24 Land parcels with affected raspberry bushes No 1 25 Total of affected raspberry bushes No 520 26 Land parcels with affected saplings nursery No 3 27 Total of affected saplings No 4,467

Page 33 || 132 No. Description Unit Number 28 Total of affected trees No 131,524 Affected Structures Residential Houses No 10 28 Vacated residential houses built of stone and bricks No 3 29 Auxiliary structures attached to affected rural residential land parcels No 3 Minor developments 30 Simple sheds standing in the agricultural land parcels built of wooden No 50 and metal poles with asbestos roofing 31 Concrete vessel used for treatment grape plants No 59 32 Clay vessel for wine storage No 4 33 Agricultural land parcels with minor developments, such as fences No 13 made of wooden/metal poles, latrine, iron gates, etc. Affected Households 34 Total of affected households No. 720 35 Total of affected persons No 1787 36 Male affected No 900 37 Females affected No 887 38 Severely affected Households No. 615 39 Vulnerable Households No 28 40 Resettled households No. 0 41 Number of AHs losing arable agricultural land parcels used for No 717 agricultural purposes 42 Number of AHs losing residential land parcels attached with vacated No. 3 residential dwellings 43 Number of AH losing agricultural land parcel used as sapling nursery No 1

Page 34 || 132 3 SOCIO-ECONOMIC INFORMATION

3.1 Introduction

41. A census of 100% of the AHs available on site was conducted to enumerate the APs. The census and socio-economic survey was conducted with regard to all located project affected households. Some householders residing in Tbilisi were interviewed in person, while others working abroad were interviewed through telephone and Skype calls. An extended socio-economic survey covers 99.6% of the total AHs covered in census. The objective of the socioeconomic survey was to gather general information on socioeconomic condition of the affected people. The socioeconomic information of the affected population as per census and socioeconomic survey is presented hereunder.

3.2 Affected Population

Age Composition of AHs

42. The Socio-economic profile of the APs is based on the information obtained during census and the results of socio-economic survey of all located AHs. The total number of affected households (720 AHs) comprises 1 787 persons (900 male 887 female). Of these 1 787, underage persons account for 252 (150 boys and 102 girls). The average size of a household is 2.52 persons. However, few households count from five to seven household members.

43. The table below shows the age composition of the APs disaggregated according to gender and age groups of adults and underage persons.

Table 3-1: Breakdown of APs according to Age Groups and Gender

Male Female Total Project Affected Number % Number % Number % persons Adult 750 83 785 89 1535 86 Underage 150 17 102 11 252 14 (below 18 years) Total 900 100 887 100 1787 100 Source: Census and SES of AHs undertaken by the Consultant.

Page 35 || 132 3.2.1 Occupation and Main Source of Income of AHs

44. Majority of the local population is mainly engaged in agriculture. Main annual crops grown are grapes, fruits, vegetables, and corn. Vegetables, mainly cucumber, tomatoes, beans, garlic and onion are grown for family consumption, and they only sell a small portion of their produce at the local market, or to the wholesalers at the farm gate.

45. Most of the households keep poultry. Very few keep a cow. But most of them grow grapes to make wine mainly for self-consumption, although a surplus might be sold during public holidays as well.

46. Besides the vineyards, fruit gardens are also popular. Some project affected land parcels are carefully planted with peach, apricot or cherry trees. The yield is often sold to whole-sellers right from the farm gate, therefore the landowners do not need to engage storage of excess fruits.

47. Irrigated and nutrient-rich soil guarantees a good yield to APs. Land cultivation and harvesting periods are the busiest time for local people. Those who live in the Capital city often have arrangements with their relatives to look after their land parcels.

48. During key informant interviews, census and socioeconomic survey, most of the AHs confirmed that arable agricultural land is of vital importance for their livelihood13. During the demarcation and re-survey of project affected land parcels, the inventory of project affected assets confirmed that less than half of land parcels had been cultivated this year. According to the AHs, they cannot cover the cultivation costs since the government stopped issuance of vouchers they used in the last couple of years for cultivation of these land parcels. Perhaps due to similar reasons many landowners are keen to sell their land parcels through internet listings.

49. Few men have temporary jobs in construction and often leave home to earn a living. A few men drive cars and provide taxi services to the villagers. Many adult men do not have salaried employment, thus placing a majority of men into the category of interested in full-time employment opportunities.

50. Most of the females are housewives taking care of family and children and they also tend to the fields growing crops. A few have paid jobs as civil servants or assist their family members to run local shops selling agricultural produce or consumer goods.

51. It is worth noting that AHs did not properly quantify their annual income gained from agricultural activities but indicated that they use grown crops mostly for personal consumption and sharing with their children who live in towns. In terms of cash inflow, they found it easier to report monthly salary rates, retirement pension, and/or disability aid and regular costs for food, consumer goods, utilities, communication and health care expenditures.

13 Due to lack of reserve lands in Georgia, land-for-land compensation in the same area was not possible in this project. However, there is an active land market in the project region of Kakheti. Replacement rate compensation was determined to allow APs to purchase a similar land parcel for sale.

Page 36 || 132 52. The median source of cash flow is retirement pension (180 GEL/month) and State targeted aid for disability (the amount varies according to the 1st, 2nd, and 3rd category of disability).

53. As composed in the table below, the major source of income of AHs is based on the information obtained during census and socioeconomic survey of 100% of located AHs.

Table 3-2: Breakdown of APs according to their Occupation Disaggregated by Gender

Male Female Total Number Number Number Occupation of % of % of % Persons Persons Persons Farmer 369 41.00 56 6.31 425 23.78 Housewife 0 0.00 435 49.04 435 24.34 Pensioner 63 7.00 78 8.79 141 7.89 Civil Servant 72 8.00 36 4.06 108 6.04 Unemployed 18 2.00 12 1.35 30 1.68 Schoolies 150 16.67 102 11.50 252 14.10 Business/Self- 160 17.78 3 0.34 163 9.12 employed Hired labor 56 6.22 154 17.36 210 11.75 Working abroad/out of 12 1.33 11 1.24 23 1.29 region Total 900 100 887 100 1787 23.78 Source: Census and SES of AHs undertaken by the Consultant.

3.2.2 Expenses of AHs

54. The biggest share of expenses relates to food, health care, vehicle maintenance, utilities, clothing and interest rates for bank loans.

Table 3-3: Breakdown of Percentage Ratio of Average Annual Expenditures of the AHs

Percentage Ratio of AH AH expenditures expenses Food 32.84

Health care 14.53

Vehicle maintenance 11.08

Utilities 7.27

Clothing 6.17

Bank loan Interests 5.49

Page 37 || 132 Percentage Ratio of AH AH expenditures expenses Horticulture / Viticulture 4.09

Housing repairs 3.4

Transportation costs 3.36

Education /University 3.07

Telecommunication 2.5

Agriculture activity costs 2.05

Business Operational costs 1.12

Consumer Goods 1.1

Cigarettes/Alcohol 0.95

Travel/leisure 0.98

Total 100 Source: Census and SES of AHs undertaken by the Consultant.

Possessions of AHs

55. People in project affected area live in residential dwellings built of bricks and blocks. The houses are mainly two-storied. Kitchen, wine storage (so called “Marani”) and main living room is on the first level, Bedrooms are on the second floors. Additionally, most households have supplementary structures being used as storage facilities, summer kitchens, barns, and bathrooms. Usually these structures, including latrines, baths and kitchens are built separately with external access.

56. Aside to residential land plots, local people possess several land parcels, often attached with smaller orchards where they often grow small amounts of vegetables (cabbage, carrots, garlic, onion, beans and etc.). Majority of AHs have about 2000-4000 sq.m. of agricultural land parcels received during the land reforms. These land parcels are located further from the village settlement but are still an accessible distance.

57. The level of possessed durable goods vary. Except five AHs all have Color TVs and access to most TV channels. Many AHs have more than one mobile phone. Landline telephones are less popular though about 14% still use them. Every AH has at least a small refrigerator and about 80% have washing machines. 350 AHs keep an automobile to travel to the rayon center and Capital city; some use a vehicle just to get to the agricultural fields and markets. Many have access to Internet through mobile phones, while 250 AHs still have a PC or laptop. WCs are mainly outside of the residential dwellings. Hot water is available to most AHs operating on natural gas or wood fire. Natural gas, potable water and electricity is

Page 38 || 132 provided to all AHs. Only a limited number of AHs managed to install WCs inside their house and/or to organize autonomous heating systems.

Table 3-4: Breakdown of the Possession of Durable Assets of AHs

Item Number of AHs % Color TV & Satellite Dish 700 98.87 Mobile phone 1400 197.74 Landline telephone 102 14.41 PC and/or Laptop 250 35.31 Internet 350 49.44 Autonomous heating system 3 0.42 Gas Hater 358 50.56 Gas water heater 687 97.03 Wood stove 705 99.58 Washing machine 570 80.51 Refrigerator 708 100.00 Motorcycle 65 9.18 Automobile 350 49.44 Mini tractor 190 26.84 Mini Bus 58 8.19 Lorry 26 3.67 TOTAL of AHs 708 100 Source: Census and SES of AHs undertaken by the Consultant.

3.2.3 Education and Literacy of AHs

58. The level of literacy of AHs is reported to be 100%. The adults (480 male and 490 female) attended secondary school. 138 (17.58%) females have higher education degrees, while 150 men (20%) of males are University graduates. 119 men and 138 women managed to obtain technical education and/or vocational trainings.

Table 3-5: Sex-disaggregated Education and Literacy Level of Adult Members of AHs

Education/ Male Female Total Literacy Number % Number % Number % of of of Persons Persons Persons Primary 1 0.13 0 0.00 0 0.00 Secondary 480 64.00 490 62.42 970 63.19 Technical 119 15.87 157 20.00 276 17.98 Higher 150 20.00 138 17.58 288 18.76 (university) Total 750 100 785 100 1535 100 Source: Census and SES of AHs undertaken by the Consultant.

Page 39 || 132

3.2.4 Women in the Local Context

59. Women are mainly involved in farming and agriculture as well as general household works. Women participate in household decision-making processes and organizing family matters. During census and socioeconomic survey, female respondents were active and willing interviewees.

60. The majority of affected households are headed by men, however female headed households are recorded during the census and SES. Often together with the head of HH the female members of the household attended the inventory of project affected assets and confirmed the accuracy of undertaken surveys. Moreover, most women expressed readiness to share the decision maker’s roles when it the project will reach the phase of land acquisition and issuance of cash compensation.

Impact on Minorities

61. No ethnic minorities are among the Project Affected Persons. All APs are Georgian. No group of local residents showed any specific or unique features that could be identified as a distinct minority group. No impact on Indigenous People is expected from the Project. The investment program area does not include communities that may be defined as indigenous peoples under ADB's Safeguard Policy Statement (2009). Consequently, the indigenous peoples' impact classification for the proposed project is C.

62. The project at the construction phase will include appropriate measures to mitigate the potential risk of HIV/AIDS and other sexually transmitted diseases, as well as drugs and human trafficking. These measures include raising public awareness and shall be undertaken by Construction Contractor and/or Supervision Consultant as requested according to the specific contractual agreements.

Page 40 || 132 4 LEGAL AND POLICY FRAMEWORK

4.1 General

63. The legal and policy framework of the Project is based on national laws and legislations related to Land Acquisition and Resettlement (LAR) in Georgia and ADB’s Safeguard Policy Statement 2009. Based on the analysis of applicable laws and policies and ADB’s Policy requirement, project related LAR principles have been adopted.

4.2 Legal Framework

4.2.1 Georgia’s Laws and Regulations on Land Acquisition and Resettlement

64. In Georgia, the legislative acts given below regulate the issues of obtaining State ownership rights to privately owned land parcels based on the necessary public needs caused due to road constructions activities:

(i) The Constitution of Georgia, August 24, 1995 (Last update 16 October 2013) (ii) The Civil Code of Georgia, June 26, 1997 (amend. 2000, 2002, 2003, 2004, 2005, 2006, 207, 2008, 2009, 2010, 2011, 2012, 2013, 2014,2015, 2016) (iii) The Law of Georgia on Notary Actions, December 4 2009 (amend. 2010, 2011,2012, 2013, 2014, 2015) (iv) Law on Public Health 27 June 2007 (amend. 2009, 2010, 2011, 2012, 2013, 2014, 2015) (v) The Law of Georgia on Ownership Rights to Agricultural Land, March 22, 1996 (amend. 1997, 1998, 1999, 2000, 2003, 2004, 2007, 2010, 2012, 2014, 2016) (vi) Law on Compensation of Land Substitute Costs and Damages due to Allocating Agricultural Land for Non-Agricultural Purposes 1997 (amend. 2005, 2006, 2007, 2009, 2010, 2011, 2013, 2014, 2015) (vii) The Law of Georgia on Recognition of the Property Ownership Rights Regarding the Land Plots Owned (Used) by Physical Persons or Legal entities; 11 June 2007 (amend. 2007,2008,2009 2010, 2011, 2012) (viii) Law on state property 2010 (amend 2011, 2012,2013,2014, 2016) (ix) The Law of Georgia on Public Register- No820 –IIs; December 19 of 2008; (amended 2009 2010, 2011, 2012, 2013, 2014, 2015) (x) In frames of national project, the Law of Legal Power of Land Parcels Systemic and Sporadic Registration and Improvement of Quality of Cadastral Data. June 17 of 2016. (amended December 14, 2016) (xi) The Law of Georgia on the Rules for Expropriation of Ownership for Necessary Public Need, July 23, 1999 (amend. 2005, 2007, 2010, 2013, 2017) (xii) The Civil Procedural Code of Georgia, November 14, 1997(amend. 1998-2015)

Page 41 || 132 (xiii) The Law of Georgia on State property, June 21, 2010 (xiv) Labour Code, May 25, 2006 (xv) Tax Code, January 2005 (xvi) Law on Entrepreneurship, October 28, 1994

65. Overall, the above laws/regulations provide the principle of compensation at full replacement cost is reasonable and legally supported. The laws also identify the types of damages eligible for compensation and indicate that compensation is to be given both for loss of physical assets and for the loss of income. Finally, these laws place strong emphasis on consultation and notification to ensure that the APs participate in the process. Income loss due to loss of harvest and business closure will be compensated to cover net loss. The above- listed laws and regulations give the possibility of applying the following mechanisms for legal application of the property rights:

(i) Obtaining the right on way without expropriation through the payment of due compensation (on the basis of a contract of agreement or a court decision) prior to commencement of the activities.

(ii) Expropriation which gives the possibility of obtaining permanent right to land and/or other real estate property on the basis of Eminent Domain Law or a court decision through the payment of due compensation.

4.2.2 Expropriation

66. Acquisition of land through expropriation will be pursued under the project only in extreme cases when negotiations between APs and RDMRDI fail. Should the contract proposal fail, the expropriation process will commence by undertaking the procedures set out in the Law of Georgia “On the Rules for Expropriation of Ownership for Necessary Public Need” shall be applied. It is noted that under Georgian law, negotiation is seen as an alternative to expropriation, whereas under OP 4.12 negotiation under threat of expropriation still qualifies as involuntary resettlement.

67. Pursuant to the Law of Georgia “On the Rules for Expropriation of Ownership for Necessary Public Need” the expropriation shall be carried out based on the order of the Minister of Economy and Sustainable Development of Georgia and a court decision. The order of the Minister of Economy and Sustainable Development of Georgia will determine the case of public needs, and grant the expropriation entity rights to obtain land. Only the court shall determine a state body or local authorities and/or legal entity under the Public Law/Private Law to which the expropriation rights can be granted. The court decision should also include a detailed inventory of the assets to be expropriated and the provisions on the compensation payable to relevant land owners.

68. Under no condition would the RD occupy the required plots until:

(i) the proper judicial process as defined by the law is initiated;

Page 42 || 132 (ii) a court injunction has been obtained and properly communicated to the APs; and

(iii) the compensation/rehabilitation amounts are deposited in an escrow account.

69. No land acquisition will take place until the compensation/rehabilitation amounts envisaged in the approved RAP are deposited in an escrow account in a treasury (project account/or the EA’s account). The deposited funds will be paid to PAP upon the court decision on expropriation or in case the PAP decides to drop the case and signs the agreement with the RD.

4.2.3 Legalization

70. The RD will provide technical assistance to PAPs qualifying as legitimate possessors of project affected land parcels. These PAPs will be assisted free of charge in the process of legalization of private ownership rights to project affected assets, followed with the registration of ownership title. Following, the PAP will alienate project affected land parcel to the RDMRDI for road project purposes in return for fair compensation amount calculated according to the unit rate determined in the approved RAP.

4.2.4 ADB’s Policy on Involuntary Resettlement

71. The three important elements of ADB’s involuntary resettlement policy are (i) compensation to replace lost assets, livelihood, and income; (ii) assistance for relocation, including provision of relocation sites with appropriate facilities and services; and (iii) assistance for rehabilitation to achieve at least the same level of well-being with the project as without it. For any ADB operation requiring involuntary resettlement, resettlement planning is an integral part of project design, to be dealt with from the earliest stages of the project cycle, taking into account the following basic principles:

(i) Involuntary resettlement is to be avoided or at least minimized. (ii) Compensation/Rehabilitation provisions will ensure the maintenance of the APs’ pre-project standards of living. (iii) APs should be fully informed and consulted on LAR compensation options. (iv) APs’ socio-cultural institutions should be supported/used as much as possible. (v) Compensation will be carried out with equal consideration of women and men. (vi) Lack of legal title should not be a bar to compensation and/or rehabilitation. (vii) Particular attention should be paid to households headed by women and other vulnerable groups, such as Indigenous Peoples, and appropriate assistance should be provided to help them improve their status. (viii) LAR should be conceived and executed as a part of the project, and the full costs of compensation should be included in project costs and benefits.

Page 43 || 132 (ix) Compensation and resettlement subsidies will be fully provided prior to clearance of right of way/ ground levelling and demolition.

4.2.5 Comparison of ADB Policy with Georgian Laws and Legislation

72. Overall, the legislation of Georgia adequately reflects the major provisions of the ADB Safeguards Policy Statement (2009) but a few differences are to be noted. The most significant of these differences is that under Georgian legislation/regulation, emphasis is put on the definition of formal property rights and on how the acquisition of properties for public purposes is to be implemented and compensated while in the case of ADB policy emphasis is put both on the compensation of rightfully owned affected assets and on the general rehabilitation of the livelihood of Affected People (AP) and Households (AH). Because of this, ADB policy complements the Georgian legislation/regulation with additional requirements related to (i) the economic rehabilitation of all AP/AH (including those who do not have legal/formal rights on assets acquired by a project); (ii) the provision of indemnities for loss of business and income, (iii) and the provision of special allowances covering AP/AH expenses during the resettlement process or covering the special needs of severely affected or vulnerable AP/AHs. Also, in addition, the legislation of Georgia does not require any specific measure regarding the need to prepare LARPs based on extensive public consultations. The differences between Georgia law/regulation and ADB policy are outlined in Table 4-1.

Table 4-1 Comparison of Georgian Laws on LAR and ADB Resettlement Policy

Georgia Laws and Regulations ADB Involuntary Resettlement Policy Land compensation only for titled landowners. In Lack of title should not be a bar to compensation and/or practice legalizable landowners are also rehabilitation. Non-titled landowners receive rehabilitation compensated after they register their ownership with assistance. the NAPR.

Only registered houses/buildings are compensated All Affected houses/buildings are compensated for for damages/demolition caused by a project buildings damages/demolition caused by a project

Crop losses compensation provided only to Crop losses compensation provided to landowners and registered landowners. sharecrop/lease tenants whether registered or not

Land Acquisition Committee is the only pre-litigation Complaints & grievances are resolved informally through final authority to decide disputes and address community participation in the Grievance Redress complaints regarding quantification and assessment Committees (GRC), Local governments, and NGO and/or of compensation for the affected assets. local-level community-based organizations (CBOs).

Decisions regarding LAR are discussed only Information on quantification, affected items value assets, between the landowners and the Land Acquisition entitlements, and compensation/financial assistance Authorities. amounts are to be disclosed to the APs prior to appraisal.

Loss of income is considered for compensation but ADB policy requires rehabilitation for income/livelihood, no provision for income/livelihood rehabilitation, severe losses, and for expenses incurred by the APs allowances for severely affected or vulnerable APs, during the relocation process. or resettlement expenses.

There is provision for consultation with APs but Public consultation and participation is the integral part of there is no specific plan for public consultation under ADB’s policy which is a continuous process at the Georgian laws conception, preparation, implementation and finally at post implementation period

Page 44 || 132 73. To reconcile the gaps between Georgia laws/regulations and ADB Policy, RDMRDI has adopted this policy for the Project, ensuring compensation at full replacement cost of all items, the rehabilitation of informal settlers, and the provision of subsidies or allowances for AHs those will be relocated, suffer business losses, or will be severely affected.

4.2.6 Resettlement Policy Commitments for the Project

74. The resettlement policy for the project has been designed to (a) cover all APs irrespective of their title to land, (b) compensation for lost assets, and (c) restore or enhance the livelihoods of all categories of APs. The households/persons Affected by the project interventions will receive cash compensation for land and other assets at full replacement cost as per market price at the time of dispossession. Additional measures will be taken to ensure minimum disruption during the project construction period. Thus, households to be Affected physically and affected economically will receive due compensation, relocation assistance, and allowances in accordance with the Georgian laws on land acquisition and ADB’s SPS 2009, core involuntary resettlement principles are developed for this Project which are as follows:

(i) Land acquisition, and other involuntary resettlement impacts will be avoided or minimized exploring all viable alternative project designs.

(ii) Where unavoidable, a time-bound LARP will be prepared and APs will be assisted in improving or at least regaining their pre-program standard of living.

(iii) Land will be acquired through a contract agreement to the extent possible. Expropriation process will be sought only as the last resort when all possibilities of negotiation fail.

(iv) Consultation with APs on compensation, disclosure of resettlement information to APs, and participation of APs in planning and implementing of the project will be ensured.

(v) Vulnerable and severely affected APs will be provided special assistance.

(vi) Non-titled APs (e.g., informal dwellers or squatters, APs without registration details) will receive a livelihood allowance in lieu of land compensation and will be fully compensated for losses other than land.

(vii) Legalizable APs will be legalized and fully compensated for land losses.

(viii) Provision of income restoration and rehabilitation will be made.

(ix) The LARP will be disclosed to the APs in the local language which is Georgian.

(x) Payment of compensation, resettlement assistance and rehabilitation measuon the rates set in this LARP will be fully provided prior to the contractor taking physical acquisition of the land and prior to the commencement of any construction activities on a particular package.

Page 45 || 132 (xi) Compensation will be provided at least at the rates detailed in this LARP although some modification in excess will be possible during the discussions preceding the signing of the contract

(xii) Establishment of appropriate grievance redresses mechanisms to solve APs’ grievance, if occurs.

4.2.7 Land Acquisition Process

75. Complete and accurate registration of private land as per current laws governing land acquisition in Georgia is the precondition for proceeding with acquisition of private land by agencies requiring land for land based infrastructure development. RDMRDI for construction of the Bakurtsikhe-Tsnori section of road will acquire private land under eminent domain through negotiated settlement wherever possible, based on meaningful consultation with APs, including those without legal title to assets. The land buyer will offer adequate and fair price for land and/or other assets. RDMRDI will ensure that the process of land acquisition with the APs openly address the risks of asymmetry of information and bargaining power of the parties involved in such transactions. Only in case the there is no agreement to land acquisition, expropriation will be sought.

76. The ADB International Resettlement Specialist has revised and updated the RAP prepared by the detail design consultant and has completed the LARP in ADB compliant format, containing the land acquisition plan, and estimate of compensation and entitlement of individual APs under the subtitle of “Acquisition and Compensation Scheme (ACS). ACS is a detailed programme for execution of LARP as per land acquisition and resettlement framework consistent with ADB’s involuntary resettlement policy (SPS 2009).

77. Following the ACS, LAR Working Group assisted by LAR Team at rayon level will offer to each of the APs the compensation rates defined in this LARP. Upon successful settlement, Land Purchase Agreements will be signed with legalized/titled owners of acquired land parcels and Agreement of Entitlement with the non-titled APs. Any grievances of the APs will be resolved through approved grievance redress mechanism of the Project.

78. In case an AP does not accept the rates defined in this LARP even after a through the grievance redressing mechanism exercise, RDMRDI will seek concurrence of the appropriate authority in the management for proceeding with Expropriation Process under the eminent domain for acquisition of the land through Rayon courts.

79. The detail design consultant has prepared fresh maps of the acquired and residual plots with geometric details required for legalization. RDMRDI will provide these maps to the concerned legalizable owners. The process will be followed by endorsement of these maps and ownership documents by the NAPR and finally getting them registered in the local registration office prior to the receipt of the project compensation.

Page 46 || 132 4.3 Compensation Eligibility and Entitlements

4.3.1 Eligibility

80. APs entitled for compensation or at least rehabilitation provisions under the Project are:

(i) All APs losing land either covered by legal title/traditional land rights, Legalizable, or without legal status; (ii) Tenants and sharecroppers whether registered or not; (iii) Owners of buildings, crops, plants, or other objects attached to the land; and (iv) APs losing business, income, and salaries.

81. Compensation eligibility will be limited by a cut-off date to be set for each subproject on the day of the beginning of the AP Census and DMS. APs who settle in the affected areas after the cut-off date will not be eligible for compensation. They, however will be given sufficient advance notice, requested to vacate premises and dismantle affected structures prior to project implementation. Their dismantled structures materials will not be confiscated and they will not pay any fine or suffer any sanction.

4.3.2 Eligibility Criteria for Compensation of APs

82. All APs, including land users without title and legitimate possessors will be compensated for lost income and assets. Loss of land will be cash compensated at replacement cost at current market value in the amount to allow APs to acquire land of the same area, productivity and designation in vicinity of current location, as described in this LARP.

83. The criteria for eligibility of compensation are based on APs belonging to one of three groups:

1. those who have certified and/or formal rights to use the occupied land; 2. those who do not have formal legal rights to land at the time of completion DMS or census but have legitimate right to claim to such land or assets—provided that such claims are recognized under the laws of Georgia; (Untitled APs who were legitimate leasers under the old Soviet system either, plots with house or regularly cultivated/used their land, but do not have plots with a house.) 3. those who have no legitimate possession or is not eligible to claim for recognizable legal right to the land they occupy (i.e., land users without registered certificate and informal settlers) will be issued one time financial aid to allow AP the purchase of similar type of land parcel sufficient to keep on regular farming AP was involved at pre-project phase.

84. APs who are entitled to compensation under this Project include:

Page 47 || 132 1. Persons whose residential dwellings, supplementary structures, fences/walls or commercial premises and/or agricultural land (or other productive land) are in part, or totally affected (permanently or temporarily) by the Project; 2. Persons whose business is affected temporarily or permanently by the Project; 3. Persons whose business and/or employment status is affected, temporarily or permanently, by the Project; 4. Persons whose crops (annual and perennial) and/or trees are affected in part, or in total, by the Project, and; 5. Persons whose access to community resources, public facilities or property is affected in part, or in total, by the Project.

85. Where land is to be acquired, landowners (APs) with registered Title Certificate, land- users and/or legitimate possessors of land/real property eligible to legalization of ownership rights will receive cash compensation for land at full replacement value at current market price composing the amount that will allow them to purchase a land parcel of equal size and productive value and be satisfactory to the AP.

86. Those APs that are not eligible for legalization of ownership rights under any rules or regulations being in force in Georgia are not eligible for compensation for land but will receive compensation for assets attached to project affected land and other assistance as required (in particular, one time financial aid to allow an AP the purchase of similar type of land parcel sufficient to keep on regular farming AP was involved at pre-project phase).

87. Besides, in addition one-time allowance is to be issued to severely affected APs and vulnerable AHs. Households headed by single women with dependents and other vulnerable households14 will be eligible for further assistance to fully mitigate project impacts. Table 10 below presents the Entitlement Matrix that will be closely followed during RAP implementation within the framework of this project.

88. It is worth noting that the Entitlement Matrix presented in this LARP is developed based on the Entitlement Matrix enclosed in the approved RPF under the WB financed project, however this Matrix is in compliance with the ADB SPS 2009 requirements, as well, and in addition due alterations have been made to reflect the particular detaols detected during DMS, census, socio-economic surveys, land surveys and inventory project affected assets and thorough and in-depth title search undertaken during the LARP preparation for the given road project. This Entitlement Matrix provides relevant reasonable approach for loss and impact compensation and mitigation measures applicable specifically to this road project.

4.3.3 Compensation Entitlements

89. Compensation Entitlement provisions for APs losing land, houses, assets, business, income, and rehabilitation subsidies, according to the established practice include provisions for permanent and temporary loss of land, residential house and commercial buildings, annual

14 In the context of this project vulnerable groups are suggested to be identified as: single mothers, female bread winners, households below poverty line and IDPs.

Page 48 || 132 crops and trees, relocation subsidy, and business loss allowance based on tax declarations and/or lump sums.

Compensation entitlements applicable to the proposed road project are detailed below

90. Loss of land (agricultural, residential, and commercial) will be cash compensated at full replacement cost at current market value identified for the moment of LARP preparation, and in the amount15 sufficient to purchase16 replacement land of equal in value and productivity in vicinity to the project affected land parcel. Method for calculation of full replacement cost will include cost of preparation of land to levels similar to those of the affected land. The taxes and fees related to processing transaction registration will be covered by the Executing Agency.

91. The amount of cash compensation shall allow AP to acquire alternative land parcels equal in value and productivity to the parcel released for road project purposes. If during RAP preparation the need is identified that AP may have to incur additional costs for preparation of new land parcel to levels similar to those of the affected land, APs will receive additional one- time allowance to cover these costs.

92. Additionally, any fees/taxes related to processing legalization of ownership rights to project affected land parcel being under legitimate possession of AP, costs and NAPR registration fees for updated titles, correction of inheritance and other required actions will also be covered by the Executing Agency (RD).

93. Residual land will be fully compensated if the portion of land that is left after the land is divided and purchased, if is too small for further agricultural/residential use or is difficult to access, or for any other reason become unusable or economically unviable

94. Severe Impact: APs (landowners, land-users, leaseholders and sharecroppers) losing more than 10 % of income generating land, in addition to the compensation of lost land and crops, will be provided with additional rehabilitation measure; in particular, one-time allowance equal to the market value of a year’s gross yield of the land lost or one-time cash compensation calculated based on the minimum subsistence monthly income level for the household of five (5) persons multiplied to 3 months per AH. The amount of 1025.70 GEL17 per severely affected AH will be issued to each AH facing severe project impact. The amount of this one-

15 The amount of cash compensation will be calculated according to the area of project affected land subject to acquisition multiplied to the land compensation unit rate. The unit rate per square meter of land will be determined in accordance to the widely adopted International Valuation Standards (IVS). The EA or the Consultant responsible for RAP development will hire independent licensed appraiser to meet the requirement stipulated under the approved RPF, follow the RPF’s valuation methodology and determine unit rates for compensation per each type of loss any AP may incur as a result of proposed road rehabilitation project. 16 Since it is confirmed that there are no available land resources to provide APs in-kind compensation of loss of land in the form of alternative land parcel of similar productivity, designation, area and location even if preferred by APs, the Consultant pursues cash compensation for loss of land. 17 http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. By May 2019 the minimum monthly income subsistence level for the household of 5 members is 378.9 GEL. In particular: 379 X 3= 1,137 GEL per affected household.

Page 49 || 132 time compensation is calculated based on the data retrieved from official website of the National Statistics Office of Georgia – GEOSTAT18.

95. NOTE: in case of the given road project the nature and character of severe impact exceeds the traditional approach of losing more that 10 % of income generating land. Within the context of this project some AHs19 are expected to face the difficulty in obtaining official documents required for registration their title at the NAPR to the project affected land parcels. Although, these land parcels have been under their physical possession for decades, some land possessors who applied to the State Archive20 were not issued the official statement on land possession. For instance, in Tsnori rayon the archive data were destroyed several decades ago, as per the local officials.

96. In fact, the lack of official document verifying the fact of using land for years may still deprive an individual from being officially declared as land possessor and obtain title to project affected land parcel. Correspondingly, APs who will not be able to obtain such document from the State Archive will not be able to further proceed with title registration at the NAPR, thus resulting to be ineligible to cash compensation for land required for road project purposes.

97. APs who - due to that type of legal constraints - will not be able to receive land cash compensation at replacement cost, meaning that they will hardly be able to get cash compensation enough to purchase a new land parcel of similar designation; thus, these households may be led to deterioration of their livelihood as a result of the proposed project, unless alternative solution is pursued.

98. Loss of shared agricultural land (pasture, grazing) local communities losing access to shared pasture, hay field, grazing will be provided with replacement land of similar size, productivity, and location acceptable to affected community. Provision of such replacement land will be the responsibility of local government. However, the Executing Agency will bear the responsibility to monitor the process and ensure that such replacement land is timely provided to project affected community at the earlier stage of project cycle to prevent deterioration of livelihood within project influence area. If such replacement is not possible, Livelihood Restoration Plan will be prepared and implemented to address the needs of affected community and preserve their livelihood at least similar to pre-project level.

99. The Executing Agency will cover any costs, land tax or registration fees if applicable according to laws or local regulations in force.

100. Structures (residential houses, supplementary constructions, walls, commercial facilities, etc.) are cash compensated at replacement cost (i.e. Construction Cost) at current market value calculated for project affected structure and other fixed assets free of salvageable materials, depreciation and transaction costs.

101. Construction cost calculation considers market cost of the materials to build a replacement structure with an area and quality similar to or better than those of the affected

18 Same as above. 19 More specific information and the number of such AHs will be determined by the completion of title registration currently being undergoing. 20 The State Archive Statement should specify whether a person and his/her household have been land possessors and land tax payers and also specify the individual record number of a specific land tax payer.

Page 50 || 132 structure, or to repair a partially affected structure, plus the cost of transporting building materials to the construction site, the cost of any labor and contractor’s fees, and the cost of any construction permits, preparation of architectural drawings and design services, and registration fees, transfer costs and any applicable taxes/fees. The compensation for residential houses/commercial buildings will include the cost of reinstatement lost utilities (water, natural gas, electricity internet connections) and even access road, if applicable.

102. In case of partial impacts, full cash assistance to restore the remaining structure will apply; if partial impact/demolition of a section of the building threatens deterioration of the structure or raises safety and security concerns, cash compensation will apply to the entire building and affixed assets of the affected structure.

103. Light and/or iron meshed fences and access gates: Cash compensation will be issued to APs for replacement of iron meshed fences and access gates.

104. Trees: Cash compensation shall reflect income replacement. Cash compensation will be calculated at current market value and according to type, age, and productive value of project affected fruit tree. Annual yield capacity of a mature fruit bearing tree multiplied to market price of a fruit (kg/GEL) and multiplied to the number of years required to grow a new tree to same productivity age. In addition, each fruit bearing tree shall be compensated for purchase of sapling.

105. The following formula is adopted to calculate cash compensation for fruit bearing project affected perennials:

{ (B x D) x C } + A } - A – Price of sapling of a specific fruit tree - B – Market price of a specific fruit GEL/kg) - C – Number of years to be compensated - D – Annual yield capacity of a fruit tree (kg/yr./tree)

106. Besides, Construction Company will log down project affected trees and ensure free delivery of timber to the residence of APs. APs will be eligible to dispose logged trees themselves.

107. Timber trees /non fruit bearing perennials: No cash compensation will be issued for perennials not bearing fruits. APs will be eligible to dispose logged trees themselves. Construction Company ensures free logging and delivery of timber to the residence of APs.

108. Crops: Default payment of cash compensation at current market rates for annual crops per entire area of project affected land parcel. Compensation will be issued even in case the APs have managed to collect the yield. Crop compensation will be paid to landowners. In case of tenancy agreement, cash compensation will be paid to owner/tenant based on the specific sharecropping agreements (written/verbal) being made between these two parties.

109. Permanent Loss of Businesses: No case of permanent loss of business is expected within the framework of the proposed project. Correspondingly, no threat of permanent loss of

Page 51 || 132 salaries and wages for business workers and /or employees is expected within the framework of this project.

110. Temporary Loss of Business: The owner of the business entity will receive cash compensation for temporary stoppage of business to cash cover the income of the interruption period maximum up to three (3) months. The amount will be calculated based on a tax declaration; if for some reasonable reasons a business owner fails to present official tax declaration, cash compensation will be based on one-time allowance in the amount of minimum subsistence income level for a family of five members (379 GEL/month21) multiplied to three (3) months.

111. Temporary loss of salaries /wages as a result of temporary stoppage of business: Indemnity for lost wages for the period of business interruption, maximum to three (3) months. The salary rates will be retrieved from officially submitted tax declaration reports; if such reports unavailable, then official minimum monthly salary multiplied to the number of months of actual stoppage of business up to maximum three (3) months.

112. Construction Company will be responsible to cover the loss of salaries and wages in case if actual stoppage of business lasts more than 3 months in the framework of this proposed road project.

113. Agricultural land leaseholders and workers: Affected leaseholders will receive either a renewal of the lease in other plots or cash corresponding to the yearly yield of land lost for the remaining years of the lease up to a maximum of 3 years. Sharecroppers will receive their share of harvest at market rates (if impact is temporary) plus one additional crop compensation (if impact is permanent). Agricultural workers, with contracts to be interrupted, will receive an indemnity in cash corresponding to their salary in cash including portion in-kind compensation for the remaining part of the agricultural year.

114. Residential land renters/leaseholders and house renters: who have leased land and/or a house for residential purposes will be provided with a cash grant of three (3) months’ rent at the prevailing market rate in the area and will be assisted in identifying alternative accommodation.

115. Relocation subsidy: APs subject to physical relocation will receive a one-time relocation subsidy sufficient to cover transport costs and living expenses for one month. If for project-related reasons the relocation is delayed, such as untimely payment of compensation, the payment of living expenses will be extended to the period under which the person is not able to relocate to a new place.

116. Community Structures and Public Utilities: If affected, assets will be fully relocated or rehabilitated to meet their pre-project functions and utilities.

21 As per GEOSTAT official website, the amount equals to 341.90 GEL/month. The most recent updated refers to July 2018. The amount of 341.90 GEL X 3 months = 1,025.70 GEL was proposed for the cut-off date as allowance per an owner of temporarily affected business. The data is available on the official website of the State Department of Statistics of Georgia. Link: http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. The latest data (May 2019) provides higher rates: 378.9 Gel per the family consisting of 5 persons. 379 x 3 = 1,137 GEL

Page 52 || 132 4.3.4 Additional Rehabilitation Measures

117. In compliance with OP 4.12 and the approved RPF this draft RAP considers additional rehabilitation measures to be provided once vulnerable groups and the APs holding severely affected land parcels are detected during RAP related surveys (census, socio-economic survey, DMS, land surveys, inventory of assets and title search) and RAP preparation.

118. Assistance for vulnerable people and severely affected households: In addition to the compensation of lost land and assets vulnerable HHs will be provided with additional rehabilitation measures; in particular, one-time allowance set to cash compensation calculated based on the minimum subsistence monthly income level for the household of five (5) persons multiplied to 3 months per AH. The amount of 1,137 GEL22 per severely affected land parcel will be issued to each AH facing severe project impact. The amount of this one-time compensation is calculated based on the data retrieved from official website of the National Statistics Office of Georgia – GEOSTAT23. During project implementation monitoring will cover the assessment of vulnerable groups to assess their livelihood and provided additional assistance if such need detected to ensure that the objectives of the approved RPF and this RAP are met.

119. Additionally, other capable family members of vulnerable group will be given priority in employment in project-related jobs.

4.3.5 Validity Period of Valuation Report and Unit Rates

120. The unit rates determined based on the Valuation Report prepared by the licensed valuator for the specific project is valid with in the reasonable time period depending on the trends of price fluctuation and real property market activity and number of factors that may influence current market value at the local real estate market sub-segment. Anyhow, if more than a year has passed between the time of valuation and the time of compensation the unit rates will be revised and if needed a new valuation report be prepared prior to commencement of land acquisition and issuance of cash compensations to APs.

4.3.6 Escrow Accounts

121. Amount of cash compensation will be deposited on the special account under authorization of the Roads Department if, during RAP implementation process, any AP is missing, absent, or deceased, issuance of compensation is postponed due to legal procedures or is not received by the AP due to any other legitimate reason.

APs with Bank Loans and Mortgaged Project Affected Assets

22 http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. Minimum monthly income subsistence level for the cut-off date for household of 5 members is 341.90 GEL. In particular: 341.90 X 3= 1025.70 GEL per vulnerable household. The latest data (May 2019) provides higher rates: 378.9 Gel per the family consisting of 5 persons. 379 x 3 = 1,137 GEL 23 As above.

Page 53 || 132 122. APs - holding financial liabilities or bank loans using as collateral project affected assets - will be given a choice:

a. RD will transfer compensation amount directly to the bank to cover the mortgage loan and the remaining amount to be wire transferred to the AP; or b. RD will deposit the amount of compensation on the special account (i.e., escrow account) until APs settle Bank loan and only afterwards the cash will be transferred to APs’ personal account.

4.3.7 Taxation and Official Fees

123. The APs will not be liable for NAPR transaction fees, including sub-division and registration, Notary fees, court related administrative fees and taxes incurred as a result of the compensation payment (income tax and/or VAT). These costs will be fully covered by the Executing Agency, Roads Department (RDMRDI). Additionally, RDMRDI will cover bank service fees.

4.3.8 Trainings and other assistance

124. In addition to the compensation permanently affected business owners, business worker and employees, land owners, farmers, vulnerable and severely affected AHs, if their clear interest and readiness to participate is expressed, will be provided with trainings on computer literacy and/or other trainings according the request and needs identified as part of livelihood restoration activities. These costs will be covered from the LARP budget item- Contingencies.

4.3.9 Entitlement Matrix

Table 4-2 : Entitlement Matrix

Type of Impact Application Definition of AP Compensation Entitlements Permanent loss All land losses APs APs will receive cash compensation of all types of independent from (with fully registered calculated at full replacement cost at land (arable, impact severity title) current market value.24 residential, Method for calculation of full replacement industrial, cost besides the value of affected asset commercial) also includes cost of preparation of the land to levels similar to those of the affected land.

24 Detailed description of replacement cost at current market value is described in the Section: Methodology for valuation and determination of unit rates.

Page 54 || 132 Type of Impact Application Definition of AP Compensation Entitlements AHs will be free of taxes, land parcel sub-division and transaction registration costs. The taxes and fee related to processing transaction registration will be covered by the Executing Agency.

If any remaining part of the land owned by the registered owners is no longer appropriate for use, such remaining part will also be purchased subject to the agreement with the owner. Residual Land (so All APs holding land If any remaining part of the land owned called “Orphan title by the registered owners is no longer be land“) appropriately used, such remaining part will also be purchased subject to the agreement with the owner. Cash compensation will be calculated as usual at full replacement cost at current market value as applicable to the cases of permanent loss of land for title holders/legitimate possessors.

All APs holding APs who use more APs who possess captured land will not excess (surplus) area then allocated be cash compensated, unless registered land25 under title documents in the NAPR according to the decision of land legalization commission. However, any loss of annual crops and other improvements will be cash compensated in cash at full market rate for annual harvest to be paid to land- user. APs (possessors of Assistance to APs in the process of legalizable land legalization of project affected land parcel parcel) being under their possession. Once legalization and registration of ownership title is accomplished, land acquisition will be undertaken, and AP will receive cash compensation at full replacement cost at current market value at unit rate proposed in approved LARP. Non-titled, non- APs who due to lost These APs in addition to cash legalizable land official records turn out compensation for all affected assets users; to be fully deprived except land will receive one-time APs identified as from eligibility to allowance in the amount of 6 months De-facto land obtain ownership title subsistence income for the family of five possessors without to a land parcel being members.26 any legal document used, cultivated for originating the decades without any ownership right (no disputes or claims documents found in raised by the owners the State Archive, of the adjacent land neither found in the parcels

25 Excess (surplus) land refers to the cases when AP uses more area of land than as shown in documents originating land ownership rights. Such cases will be transferred for the review and approval /rejection of local land legalization commission prior to updating the registration. 26 http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. Minimum monthly income subsistence level for the household of 5 members is 378.90 GEL. In particular: 379 X 6= 2,274 GEL per vulnerable household.

Page 55 || 132 Type of Impact Application Definition of AP Compensation Entitlements land tax payer’s list recorder with Tax Department under the MOF of Georgia. Leaseholder of private Free of charge renewal of lease in other or public lands plots of equal value/productivity of affected land parcel or Cash compensation equivalent to market value of gross yield of affected land for the remaining lease years (up to a maximum of 3 years). Plus, cash compensation to reimburse the proven investments incurred by the Leaseholder to improve the leased land. Leaseholder Cash compensation equivalent to (not registered) market value of gross yield of affected land for the remaining lease years (up to a maximum of 3 years). Squatters One-time rehabilitation allowance equal to market value of 1 year gross harvest (in addition to crop compensation) for land use loss. Permanent loss Local community Affected community will be free of of community losing access to charge allocated replacement land of land (pastures, pasture, grazing land similar size, productivity, and location grazing land) acceptable to affected community by the local government. If such replacement is not possible, Livelihood Restoration Plan will be prepared and implemented to address the needs of affected community and preserve their livelihood at least similar to pre-project level. Structures Residential Project affected APs with registered All impacts will be considered as full houses and residential ownership title; impacts disregarding the actual impact structures dwellings and other APs declared as percentage. Impacts will be compensated structures subject legitimate possessors in cash at full replacement costs to partial/full calculated at replacement cost of project demolition affected structures and fixed assets free of depreciation, without deducting cost for salvaged materials and transaction costs.

Residential One-time allowance equals monthly tenants/renters rental fee (specified in the lease agreement) multiplied by 327; if Lease agreement is not available, minimum monthly salary multiplied by 328. In addition, one-time technical assistance for transportation personal belongings to a new location; or one- time cash allowance to cover costs for

27 If there are cases where the tenant/renter has paid rent in advance for a longer period of time, he owner will be requested to reimburse the money to the tenant/renter for the corresponding period if adequate evidence is available. 28 If there are cases where the tenant/renter has paid rent in advance for a longer period of time, the landlord will be requested to reimburse the money to the tenant/renter for the corresponding period if adequate evidence is available.

Page 56 || 132 Type of Impact Application Definition of AP Compensation Entitlements transportation personal belongings in the maximum amount of 300 GEL/PAH.

Commercial Project affected Titleholder Cash compensation at replacement cost structure commercial calculated for project affected structure facilities subject to and other fixed assets free of partial/full salvageable materials, depreciation and demolition transaction costs. If partial demolition threats deterioration of structure or raises safety and security concerns the cash compensation will apply to the entire building and affixed assets. Tenant of commercial One-time allowance equal to monthly facility rental fee (specified in the lease agreement) multiplied by 3; if Lease agreement is not available, minimum monthly salary multiplied by 3. Solid Walls All APs with solid All APs Cash compensation at replacement walls to be affected (construction) cost according to the material and linear meter length of affected fence/wall.

Light and/or iron All APs with affected Cash compensation will be issued to APs meshed fences agricultural land for replacement of light or iron meshed and access parcels fences and access gates, according to gates the unit rates determined in the RAP. Annual Crops Crops affected All APs (including Crop compensation in cash at gross squatters) market value of actual or expected harvest. Compensation for this item will be provided even in case if the crops were harvested. Perennials Project affected All PAPs (including Cash compensation at market value on standing on Fruit bearing squatters) the basis of type, age, and productive private land perennials value of fruit tree; Each fruit bearing tree parcels in addition shall be compensated for purchase of saplings29. PAPs will be eligible to dispose logged trees themselves. Construction company ensures free logging and delivery of timber to the residence of PAPs. Project affected All PAPs (including No cash compensation will be issued for non-fruit bearing squatters) perennials not bearing fruits. PAPs will perennials be eligible to dispose logged trees themselves. Construction Company ensures free logging and delivery of timber to the residence of PAPs. Perennials Standing trees Perennials standing Construction Company will deliver (on public/State outside of private land logged down trees and transfer to the land) Municipality. Municipality may later distribute to local population below poverty levels.

29 Valuation methodology for trees is described in Annex 1.

Page 57 || 132 Type of Impact Application Definition of AP Compensation Entitlements Perennials Standing non fruit Perennials standing The legal implementation of the standing on the trees outside of private land mentioned activity requires, that forestry land Perennials standing on the forestry land must be delisted from the State forest fund in accordance with the corresponding Decrees of Government of Georgia Construction Company will deliver logged down trees and transfer to the Municipality. Municipality may later distribute to local population below poverty levels. Income loss Lessors/landlords Impact of Temporary or All APs (including Business owner: (i) Cash compensation business, permanent squatters) equal to one-year income, if loss is business loss of permanent; (ii) cash compensation for owners and business or the period of business interruption, if loss Employment employment is temporary.

Compensation is calculated based on tax declarations. In cases where tax declaration reports are unavailable, or when the monthly income is less than monthly subsistence minimum, then official subsistence minimum30 is taken as a basis and this figure is multiplied by 12 months (permanent impact) or by number of months of business interruption (temporary impact). Worker/employees: Indemnity for lost wages for the period of business interruption. In case of permanent stoppage of the business, the employees will receive Indemnity for lost wages for 1 year. In cases where tax declaration reports are unavailable, or when the monthly salary is less than monthly subsistence minimum, then official subsistence minimum multiplied to the number of months of actual stoppage of business is paid or multiplied to 12 months in case of permanent loss of job. Agricultural Cash indemnity corresponding to their workers losing their salary for the remaining part of the contract agricultural year, and where needed livelihood restoration measures. Additional Rehabilitation Measures Technical assistance in legalization, registration procedures

Relocation Transport and All PAPs affected Provision of sufficient allowance to cover transitional by relocation transport expenses and livelihood livelihood expenses for three months. For this allowances project the Relocation Allowance is fixed as 300 Gel.

30 Same as above.

Page 58 || 132 Type of Impact Application Definition of AP Compensation Entitlements

Additional one-time allowance in the amount of 3-months minimum monthly subsistence for the families consisting of 5 members will be provided only to PAHs permanently residing in residential dwellings subject to acquisition. Community Access shall be maintained or reinstated; Resources Rehabilitation/substitution of the affected structures/utilities (i.e. bridges, roads, schools, health-centers, potable water supply systems, irrigation channels, etc.) Vulnerable AHs below poverty In addition to compensation for assets AHs Line, female lost, one-time allowance set to be three breadwinners, IDPs. (3) months payment of the minimum monthly subsistence income level31 and employment priority in project related jobs. Severely >10 % income loss All severely affected In addition to compensation for assets affected PAPs AHs including informal lost, one-time allowance set to be three settlers (3) months payment of the minimum monthly subsistence income level32 and employment priority in project related jobs. Temporary Loss of access to Owners/Users Temporary access will be set up by impact land parcel Construction Company. In cases of temporary loss of access to land parcel results in loss to crops, the construction company will compensate APs. All losses and amount of due compensation shall be determined according to the principles of compensation entitlements provided under this RPF and relevant RAP. Avoidance of Business units Temporary access will be set up by interruption of Construction Company. temporary access road to the business activity Temporary loss of Owners/users During camps' site selection process income caused by Construction Company should occupying land coordinate with relevant state agencies parcels for the and give priority to vacant lands not used camps and quarries for agricultural /residential purposes. But in case the land parcels selected for camps and quarries will have private land-users, all losses and amount of due compensation shall be determined according to the principles of

31 The amount of minimum monthly subsistence income level for the family of five members obtained from the official website of the Department of Statistics for July 2018; In particular: 341.90 X 3=1,025.70 GEL. Source: http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. The latest data (May 2019) provides higher rates: 378.9 Gel per the family consisting of 5 persons. 379 x 3 = 1,137 GEL 32 The amount of minimum monthly subsistence income level for the family of five members obtained from the official website of the Department of Statistics for July 2018; In particular: 341.90 X 3=1,025.70 GEL. Source: http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng. The latest data (May 2019) provides higher rates: 378.9 Gel per the family consisting of 5 persons. 379 x 3 = 1,137 GEL

Page 59 || 132 Type of Impact Application Definition of AP Compensation Entitlements compensation entitlements provided under this LARP. Any other As required Any Road Department and the Construction unforeseen Contractor will address and mitigate Impacts /compensate unforeseen resettlement impact during project implementation period. Type of Application Definition of AP Compensation Entitlements Impact

4.3.10 Valuation and Compensation Rates

4.3.10.1 Principles and Methodology

125. The principles of valuation of acquired land and assets have been devised as per ADB policy on involuntary resettlement (SPS 2009). The policy states that all loss of the APs have to be compensated at full replacement cost at the time of dispossession of the property for purpose of infrastructure projects. The calculation of replacement costs will be based on (i) fair market value at the time of dispossession, (ii) transaction/legalization costs, (iii) transitional and restoration (land preparation and reconstruction) costs, and (v) other applicable payments. In order to ensure compensation at replacement cost, good practice examples in compliance with ADB policy were followed for determining the replacement cost of acquired assets.

126. The calculation of unit value is done keeping in consideration the current market rate so as to meet with the replacement cost of the land and lost assets etc. An experienced and registered independent local company was employed to do the valuation of land, structures, buildings, trees, crops etc. The approach of the evaluator was to make the assessment for each type of land and assets by location. The valuation was done when the census and DMS were conducted by the same company who prepared the map of affected plots with demarcation of cut-off areas. The valuation company engaged its experts for its respective areas who made site visits for physical verification of each category of the losses. The expert team also took into consideration the reference of previous valuation if available and also used their recommended periodic release of market survey. Based on this methodology the unit rate was derived. The unit rates used in this report are based on the evaluation agency’s assessment with their standard methods for calculating the sample assets.

4.3.10.2 Determination of Compensation Rates

127. Replacement cost of land has been determined based on existing market rates to the extent possible and adding the applicable transaction cost like registration with the NAPR at the rayon level Registration Office and the rayon PRRC. Market rates where defined taking into account the type of land, its purported use, and location.

128. Replacement cost of houses/buildings was determined based on construction type, cost of materials, transportation, types of construction, land preparation, labour, and other

Page 60 || 132 construction costs at current rates. No deduction for depreciation and transaction costs will be applied.

129. The unit compensation rates recommended by the valuation company have been reviewed and approved by the RDMRDI and will be offered to the APs. Detailed methodology for determining valuations and compensation rates is included in Annex-1.

Page 61 || 132 5 INSTITUTIONAL ARRANGEMENTS

5.1 Introduction

130. Ministry of Regional Development and Infrastructure (MRDI) is the executing agency (EA) of the Project on behalf of the Government of Georgia and the Roads Department of the MRDI (RDMRDI) is the implementing agency (IA). The Asian Development Bank (ADB) is financing the Project for design, civil works construction and construction supervision. RDMRDI is responsible for road construction as well as land acquisition and resettlement of the APs due to land acquisition and project construction. In addition to the RDMRDI, a number of other government departments and private agents will play an instrumental role in the design, construction and operation of the project. Pursuant to the active legislation, the Ministry of Natural Resources and Environmental Protection is responsible for environmental issues. The Ministry of Justice is responsible for legal matters regarding land ownership, and National Agency of Public Registry (NAPR) within the Ministry of Justice is in charge of the registration of land ownership and its transfer through purchase agreement from landowners to the Road Department. The local government at Sakrebulo and village level will also be involved. The specific role and responsibility of each State Agency participating in the given project is detailed below.

131. LARP comprises the road section located in Gurjaani and Sighnaghi municipalities of Kakheti Region. Representatives of Gurjaani and Sighnaghi municipalities are involved for local level LAR activities.

5.2 Roads Department and Consultants

5.2.1 Roads Department

132. RD has overall responsibility for the project. This includes preparation, implementation and financing of all LAR tasks and cross-agency coordination. RD will exercise its functions through its existing resettlement division (RDRD) which will be responsible for the general management of the planning and implementation of all LAR tasks.

133. The RDMRDI staffed with a sufficient number of LAR specialists, will be tasked with all LAR coordination tasks at central and local government level and will be responsible for:

(i) screening the projects and ensuring that the RAP is properly prepared and sent to ADB for review; (ii) supervising the consultants that prepare the RAP and assist in implementation; (iii) establishing needed LAR capacity at each regional level office where LAR is relevant; (iv) ensuring proper internal monitoring; and (v) hiring, following ADB recommendation, the external monitoring agency.

Page 62 || 132 134. RDRD will also provide all needed documentation to ensure the prompt allocation of LAR budgets to the APs and will maintain the coordination of all LAR related activities.

135. RD local offices. The Regional RD offices will assist the activities of the RDRD with one dedicated officer who will facilitate the communication between the RDRD, the local governments and the APs and assist in implementing LAR tasks related to the local administration.

5.2.2 Euro-Asian Transport Corridor Investment Center (ETCIC)

136. Eurasian Transport Corridor Investment Center (ETCIC), a special independent agency, has been established within RDMRDI for financial management of ADB and World Bank financed projects. ETCIC will get funds directly from the Ministry of Finance allocated for the project and disburse it to APs following requisition from RDRD, RDMRDI. ETCIC will review, scrutinize and transfer the amount of compensation and allowances in the bank account of APs mentioned in the Compensation and Allowance Ledger prepared, confirmed and produced by RDRD for each AP.

5.2.3 RD Consultants

Different types of consultants will be involved in LAR tasks:

a) PPTA consultants: These include international and/or local LAR capacity and needed survey teams to carry out field-surveys and prepare the RAP.

b) Design consultants: These will include international and local LAR capacity and needed survey teams carry out the same activities for updating/finalizing the RAP of first tranche based on the detailed engineering design and will also prepare RAP.

c) Supervision consultants: These include international and local LAR capacity and needed survey teams and will assist in overall Project supervision.

d) Social Safeguards Consultant (SSC): This consultant was hired to conduct the external monitoring and evaluation of the RAP implementation. In the absence of a supervision consultant, the SSC will continue to carry out the external monitoring and evaluation for all the RAP.

e) Independent Asset valuators: These will be accredited private firms to be hired by the PPTA or Design consultants to carry out the evaluation of affected assets.

5.3 Local Governments

137. Local government especially at Sakrebulo level has direct jurisdiction for land administration, valuation, verification and acquisition. To confirm the surveys and the asset

Page 63 || 132 valuations carried out by the LAR consultants RD through its consultants will establish in Sakrebulo where RAP is to be implemented a Sakrebulo Level LAR team which will have designated officials from the Sakrebulo administration. The LAR team at Sakrebulo level will have close coordination with the village administration for the LAR activities. Effective inter- agency coordination at Sakrebulo and village level will be assigned to the regional level RD

5.4 Land Registration Organizations

138. Government agencies active at various levels in the process of legalization of privately owned land parcels are described hereunder.

5.4.1 Representative of Municipality at the village/community level

139. Community level Representative of Municipality (RM) is the executive person of self- government. RM has the primary role in the process of legalization and registration of land parcels. RM confirms ownership of affected land plots, parameters of land plots and endorses the cadastral maps and related data prepared for case of legalization33. Gamgebeli plays important role for legalization of non-rightful owners (owners in possession before the enactment of current law on privatization of land in Georgia without prior permission of the government). Gamgeoba has power to authorize34 details of the occupied land parcel and verify its usage pattern as the first hand verification and authorization for further consideration in the Property Rights Registration Commission (PRRC) as a basic step for registration with the Public Registry. Neighbours of applicants for legalization have roles in the authorization process. Representative of Gurjaani and Sighnaghi municipalities will be involved in LAR process at the stage of LARP updating and implementation.

5.4.2 Municipal Sakrebulo

140. Sakrebulo is the representative branch of self-government at rayon level. Municipal Sakrebulo assists the PRRC (see below) in the process of authorization of application of non- rightful owners.

5.4.3 Property Rights Recognition Commission (PRRC)

141. Under the Law of Georgia on Recognition of the Property Ownership Rights Regarding the Land Plots Owned (Used) by Physical Persons or Legal entities; 2007 amend. 2007,2008,2009 2010, 2011, 2012), the Government of Georgia has established the PRRC at

33 Owners for legalization of their unregistered land parcels, in normal procedure, use the services of private mapping agencies and experts on payment for preparation of land details (maps and plot parameters). In case of this project, the consultants have been assisting in preparing basic documents like maps and plot details. 34 This is not mandatory but one of the possible procedures for legalization of the non-rightful owners. Witnesses’ signature confirmed notarially is also legally acceptable for confirmation of non-rightful ownership of land plot.

Page 64 || 132 the Rayon level for recognition of ownership rights of non-rightful owners for registration. PRRC verifies and authorizes application of ownership for registration with the NAPR.

5.4.4 NAPR Regional Registration Office

142. NAPR is in charge of the registration of land ownership and its transfer through purchase agreement from landowners to the RDMRDI. Rayon Archives are now transferred in the possession of the Regional Registration Offices of the NAPR. Rayon Archive is used for cross verification of ownership document and validity of physical possession of land by persons seeking registration as legalizable owner, in the case, owner does not have available documentation proving ownership rights on the adjacent land plot or in case there is any doubt regarding the plot.

143. Regional Registration Office of the NAPR is the Regional level authority for executing registration of land parcels in the name of the applicants based on package of application documents provided by rightful owners or by non-rightful owners after receiving appropriate certificate from PRRC as the case may be. The owners submit both soft copy and hard copy of plot maps with geometric details for record in the Regional and Central NAPR. The project road crosses the jurisdiction area of Kakheti (Telavi) Registration Office of the NAPR. Kakheti rayon office of NAPR is involved in the updating and implementation of LARP.

5.5 Other Agencies and Institutions

Several other institutions will participate to LAR preparation/implementation of LAR tasks (see Figure 1 below). These are:

1 Ministry of Finance. RAP implementation budgets will be provided to RDI by the Ministry of Finance following the official approval of the final RAP.

2 Ministry of Justice. The Ministry of Justice is responsible for legal matters regarding land ownership, and National Agency of Public Registry within the Ministry of Justice is in charge of land registration and transfer through purchase agreement from landowners to the Road Department.

3 Local Courts. In case of expropriation issues, RD will have to rely on the Sakrebulo court, which based on due legal process will have to review the expropriation cases, carry out a hearing and decide whether the land can be expropriated and at what price. In order to expedite the expropriation process RDMRI will negotiate with the courts a fast-tracked action plan.

4 International Financial Institutions (IFI) – In particular, ADB. Where applicable, besides regular supervision of the project activities, the IFI also reviews RAP and clear contract awards signing and initiation of civil works to all subprojects with RAP developed.

Page 65 || 132 5.6 Monitoring Agency

144. RDMRDI will appoint an independent external monitoring agency (EMA) for external monitoring and ex-post evaluation of the LARP implementation. External monitoring covers all aspects of LARP implementation, starting from legalization and finishing with payment of all compensation and rehabilitation allowances before starting civil works. External monitoring could be executed by the Engineer (civil works supervising company) in case if the Engineer is available during LARP implementation.

145. An organization chart showing all the concerned institutions to be involved in the LAR activities is depicted in Figure 5-1:

Figure 5-1 LAR Organization Chart

Government of ADB Georgia

RDMRDI MOF Tbilisi ETCIC

Detail Design RU/RDRDRDRD LARC EMA Consultant Tbilisi

LAR Working Line of Action Group

Line of Coordination

Local LAR Team Rayon Court

PRRC,P GurjaaniRRC and OzurgetiKakheti RegistrationRegistration Sighnaghi Office (NAPR)

Sakrebulo GamgeobaMunicipality

Table 5-1 Timetable for all resettlement activities according to the responsible agencies tied to overall project implementation process.

Step Action Responsibility A) LARP PREPARATION 1 Assessment of Project’s social impacts RD

Page 66 || 132 Step Action Responsibility A) LARP PREPARATION 2 Avoidance of impacts in early project design/concept stage RD/Design consultants 3 Finalization of Detailed design Design consultants Prepare surveys forms for Census and DMS, train local Census and DMS teams, and establish coordination with relevant local 4 government agencies. Consultant 5 Collection of cadastral and land parcel maps of the project area Consultants/RDRD/NAPR Verify land records in affected areas, update cadastral maps and carry out impacts and valuation surveys – Detailed Measurement Consultant/RDRD/Sakrebulo level LAR 6 Survey (DMS) Team/ 7 Conduct public consultations Consultant/RDRD/Sakrebulo Level LAR Team 8 Identification of Legal and legalizable APs Consultant/RDRD/Regional RD 9 Negotiations with APs Consultant/RDRD/Regional RD 10 Integrate data from Census into the RP. Consultant 11 Submission of LARP to RD (and ADB for approval). Consultant/RD/ADB 12 Disclosure ADB /RD

B) LARP Finalization (Detailed Design) 1 Detailed Design Design Consultant Consultant/ Regional RD/ 2 Review of impacts and AP lists based on detailed design RDRD/Sakrebulo Level LAR Team Review of prices based on the updated rate Consultant/ Regional RD/ 3 RDRD/Sakrebulo Level LAR Team Legalization of legalizable APs Consultant/ Regional RD/ 4 RDRD/Sakrebulo Level LAR Team 5 Preparation of the final LARP Consultant/RDRD 6 ADB Approval ADB RAP disclosure: Distribution of RP and information pamphlets in Georgia in the affected communities; posting of RP in English on RDRD/Consultant/Sakrebulo Level LAR 7 the ADB and RD website team/ ADB 8 Signing of civil contract award ADB /RDMRDI

C) LARP IMPLEMENTATION 1 Approval of Contract awards Signing ADB 2 Detailed Schedule for compensation action plan RDRD/RD 3 Distribution of Relocation Notices to APs RD/ RDRD/Regional RD/Sakrebulo Level LAR team 4 Processing Land Acquisition Agreements Land Compensation RD/RDRD/Regional Level RDMRDI

Page 67 || 132 Step Action Responsibility A) LARP PREPARATION 5 Processing Land Acquisition Agreements on provision RD/RDRD/ Regional Level RD Compensation & Assistance/ Rehabilitation 6 Demolishing/ Relocation of Affected Structures/Assets RD 7 Review of LARP Implementation through a compliance report RD/RDRD/SSC/ADB 8 If LARP Implementation found satisfactory, Notice to proceed for ADB /RD Civil works is issued

D) POST-IMPLEMENTATION TASKS 1 Before starting civil works prepare Compliance Reports and SSC submit to RD and ADB for review and No Objection

E) CYCLICAL/CONTINUOUS TASKS 1 Internal monitoring. Quarterly reporting to ADB RDRD 2 External Monitoring. Semi-annual reporting to ADB SSC/Supervision Consultant 3 Grievances Redress/Law Suites RDRD/Regional level RD/Court 4 Inter-agency coordination and Communication with AP RD/RDRD/Regional Level RD

Page 68 || 132 6 CONSULTATION AND PARTICIPATION

6.1 Introduction

146. Following ADB policies, the RDMRDI will ensure that this LARP is translated into Georgian and distributed to local government agencies. The Public Information Booklet35 (PIB), i.e. reduced version of the final RAP in understandable language and format for PAPs was prepared by the Consultant and distributed to all the attendees of the RAP Disclosure meetings hold in Gurjaani and Sighnaghi on July 3, 2018. In addition, extra copies of PIBs were handed to local governments responsible to make the Public Information Booklet accessible to the local population, including potentially affected communities within the project influence area for review, comments and input made during the disclosure period. All comments and suggestions were collected through the Consultant and the relevant ones are incorporated in this version of the RAP. While the project implementation period continuous, the RDMRDI will provide more copies of PIBs upon the request of local governments and APs.

147. All government agencies involved in RAP preparation and implementation process are well-informed about the project, and their assistance has been solicited in the conduct of the inventory of affected assets and the census of PAPs. In addition, PAPs have been thoroughly informed on the results of the census and inventory of impacts, and their preferences on compensation and/or other resettlement assistance was given due consideration. The processes and mechanisms ensuring the active involvement of PAPs and other stakeholders is detailed in the RAP. Annex 3 provides the summary table of consultations conducted by the Consultant during the feasibility and RAP preparation phases

6.2 Consultation Process and Methodology

148. Information dissemination to PAPs and involved agencies is an important part of RAP preparation and implementation. Consultation with PAPs and ensuring their active participation reduce the potential conflicts and minimize the risk of project delays. To ensure that local authorities, as well as representatives of PAPs, have been included in the planning and decision-making processes, RDMRDI and Consultant continue a dialogue with rayon and municipality authorities and NGOs, as relevant, during the entire project implementation process to ensure:

• Fully sharing information about the proposed subproject components and RAP activities with the PAP; • Obtaining information about the needs and priorities of PAPs, as well as receiving information about their reactions to proposed policies and activities; • That PAPs are fully informed about the decisions that will directly affect their incomes and living standards, and that they will have the opportunity to participate in activities and decision-making about issues that will directly affect them; • PAPs are given contact information of project responsible persons from local authorities/RD to timely provide sufficient feedback to their inquiries;

35 Public Information Booklet is attached in Annex 2 of this document.

Page 69 || 132 • Obtaining the cooperation and participation of the PAPs and communities in activities necessary for resettlement planning and implementation; • Transparency in all activities related to land acquisition and resettlement.

149. The public consultation meetings36 have been conducted since the early phase of RAP preparation. The public orientation meetings were open to large spectrum of project stakeholders. The objective was to keep the local authorities and PAPs well informed on pending project objectives, related impacts and mitigations. In total 205 persons attended public consultation meetings conducted in each of the six municipalities located within project influence area. The table in Annex 3 provides the details of these public meetings conducted at the very early stage of RAP preparation, prior to commencement of RAP related surveys. The meetings were attended by local population of project affected villages, potential APs, representatives of local government, NAPR agency, municipalities of Gurjaani, Bakurtsikhe, Kardanakhi, Sighnaghi, Vakiri, Anaga, Sakobo and Tsnori. The participants were provided with information on pending project, introduced to their rights and responsibilities, GRM procedures, essence and importance of APs’ participation in project planning, and pending surveys to attain high accuracy and fair approach in determination of APs’ eligibility to compensation; besides, attendees were informed and regarding the cut-off date limitations, general compensation principles, essence of replacement value and sales comparison approach, additional rehabilitation measures considered for severely affected, female headed HHs and other vulnerable groups, as stipulated in WB guidelines on Involuntary Resettlement OP 4.12 and National legislation.

150. The main objective of the series of initial public orientation meetings and consultations undertaken in field during land surveys and inventory of affected assets was to encourage participatory involvement of project affected people in RAP preparation process has been successfully achieved. Initial draft RAP was revised according to the comments of all project Stakeholders. Following the ADB policies, the Roads Department will ensure that Georgian version of the draft LARP is uploaded on RDMRDI website37. The hard copies of the Georgian version of the draft LARP will also be distributed to concerned local government agencies.

Public Information Booklet

151. The Public Information Booklet38 (PIB), i.e. reduced version of the draft RAP in understandable language and format for APs was prepared based on the draft RAP. The document summarizes essence of cut-off date, compensation eligibility criteria, brief review of valuation methodology and compensation entitlements, project schedules and implementation features, and the rights and responsibilities of APs and other project stakeholders, grievance redress mechanism and monitoring patterns.

152. The PIB was provided to all APs and local governments during the draft RAP Public Disclosure meeting held on July 3, 2018 in Gurjaani and Sighnaghi. Annex 5 provides the

36 Annex 3 provides the brief review of public orientation meetings organized by resettlement Consultant during RAP preparation period. 37 Website to be added. 38 The copy of Public Information Booklet is attached in Annex 5.

Page 70 || 132 minutes of the meetings added with overview of question-answer session, photo materials and gender disaggregated list of meetings attendees, showing their full names, contact phones and signatures.

153. The representatives of the Local government within project influence area are responsible to make the Public Information Booklet accessible to affected communities within the project influence area for review, comments and input made during the disclosure period.

154. The project stakeholders reviewed draft RAP and provided comments during RAP disclosure period. Stakeholders may also comment when the ADB and RD upload the RAP on their websites.

155. The Draft RAP Public Disclosure meeting was hold on the date preliminarily agreed with project stakeholders. The Notification on the location, time and date of Public Disclosure was provided to APs together with the copy of Information Booklet through the local Municipality personnel.

156. Besides, the relevant notifications were displayed on the Information Desk in the lobbies of the Municipality buildings in the villages: Bakurtsikhe and Kardanakhi of Gurjaani rayon and in the villages of Vakiri, Anaga, Sakobo and Tsnori of Sighnaghi rayon. The Notification on draft RAP Public Disclosure date, time and location was made early enough to ensure high attendance of APs, interested persons, government agencies and NGOs.

157. All comments and suggestions is being collected by the Consultant to be reflected in the final version of the RAP to be reviewed for No Objection.

6.3. LARP - Disclosure

158. Draft RAP Public Disclosure meeting was held on July 3, 2018 in Gurjaani and Sighnaghi. Together with representatives of local government, project affected community from each municipality was presented by lead PAPs most actively involved in the process of field surveys and public consultations during the RAP preparation process. Annex 5 provides the minutes of the meetings added with overview of question-answer session, photo materials and gender disaggregated list of meetings attendees, showing their full names, contact phones and signatures.

159. The Georgian version of the LARP will be updated accordingly after the ADB approval of the English LARP and disclosed on the RD website and at RD offices. The Final LARP in Georgian will also be disclosed to the APs at the relevant rayon centers and Municipality buildings. The English version of the final draft RAP will be disclosed on the ADB website after approval be ADB and GoG.

160. A pamphlet in Georgian, summarizing compensation eligibility and entitlement provisions, will be sent to all PAP/PAHs before the initiation of the compensation/rehabilitation process and before signing contract awards. The consultation process will be continued throughout the project cycle.

Page 71 || 132 161. Various methods used for stakeholder’s consultation and participation with concerned stakeholders are described in Table 6-1.

Table 6-1 Summary on Party Consulted and Consultation Methods

Stakeholders Purpose Method

APs and their • To inform the APs, get their views on • Meetings with all AH during community likely impacts, eligibility and entitlements, the implementation of the as well as procedures for compensation, socio-economic survey. relocation and rehabilitation. • Focus group discussions and village meetings

Roads Department • To collect government's policy, guidelines • Frequent individual (RDMRDI) including its priorities on the project, and to seek meetings with the officials Resettlement Division advice for work. of RDMRDI

National Agency for Public • To collect the cadastral map and to know • Consultation and Registry under the the details of the affected parcels and discussion with officials ministry of Justice people

Local Government at • To seek their cooperation for carrying out • Individual meetings with Rayon Level (District the impact assessment survey and to sort the officials of Poti Mayor’s Municipality), out the problem related to missing plots office and Khobi (Legalizable Owners) Municipality

Property Recognition • To seek their cooperation for carrying out • Meeting and training Commission in the Rayon the impact assessment survey and to sort Level and Sakrebulo out the problem related to missing plots (Legalizable Owners)

6.5 Changes in LAR approach following the meetings

162. Following this meeting a major modification to the planned compensation program was made. This was to define the operational zone (6m width strip of land) within the vineyards for the tractor manoeuvre and need for clearance of wine-grape trees within this corridor. Additional compensations for cutting trees within the operational zone have been calculated and included in LARP.

6.6 Consultation and Participation Plan

163. RDRD on behalf of RDMRDI will pursue information disclosure for effective implementation and timely execution of LARP. For the benefit of the community in general and APs in particular, LARP will be made available in concerned offices at Gurjaani and Signaghi municipal offices. An updated information leaflet (in Georgian) including the compensation rates will be distributed among the APs and their community.

164. For continued consultations, the following steps are envisaged in the project:

(i) Final LARP will be disclosed upon receiving approval from ADB

Page 72 || 132 (ii) RDMRDI will organize public meetings and will apprise the communities about the progress in the implementation of resettlement, and social activities. (iii) RDMRDI through its RDRD will organize public meetings to inform the community about the compensation and assistance to be paid. (iv) All monitoring and evaluation reports of LARP component of the project will be disclosed to the community. (v) Key features of the entitlements will be disclosed along the project corridor. (vi) RDMRDI will conduct information dissemination sessions at Gurjaani and Signaghi municipal offices and solicit the help of the local community leaders to encourage the participation of the APs in LARP implementation. (vii) Attempts will be made to ensure that vulnerable groups understand the process and to take their specific needs into account.

6.7 Disclosure

165. Electronic version of the Final LARP will be placed on RDMRDI web-site. The summary of LARP will be translated into local language (Georgian) and will be disclosed to APs at local level. The copy of the LARP (Georgian version) will be available at the Gurjaani and Signaghi municipal offices. The final LARP will be submitted to ADB for approval and signing of contract awards will follow after completion of legalization of the legalizable owners of the land parcels under acquisition.

Page 73 || 132 7 GRIEVANCE REDRESS MECHANISM

7.1 Objectives

166. A grievance mechanism will be established to allow a AP appealing any disagreeable decision, practice or activity arising from land or other assets compensation. APs will be fully informed of their rights and of the procedures for addressing complaints whether verbally or in writing during consultation, survey, and time of compensation. Care will always be taken to prevent grievances rather than going through a redress process. This can be done through careful LAR design and implementation, by ensuring full participation and consultation with the APs, and by establishing extensive communication and coordination between the affected communities, the RDMRDI, and local governments in general.

7.2 Grievance Resolution Process and Structure of GRM

The RDMRDI GRM consists of a temporary, project-specific units established at the local (municipal) level in project affected municipalities and regular system established at RDMRDI. Local Grievance Redress Mechanism (LGRM) is being established at municipal level as a project-specific instrument, which is functional only for the period of the project implementation. Grievance Redress Commission (GRC) is formed as permanently functional informal structure within the RDMRDI to ensure grievance review, resolution and record. GRC is operational since 2012.

Grievance resolution is a three-stage process, including:

Stage 1: grievance resolution at the local level and LGRM

Stage 1 of the grievance resolution process comprises collection of the grievances that have been submitted at the local level (to affected Municipalities; CW Contractor; RDMRDI local representatives etc.) and review and resolution of the grievances that could be administered at the local level without engagement of central GRC. The type of complaints that could be resolved at the local level include usually construction related environmental and social impacts, like damage of assets, community infrastructure, dust emissions or noise impacts, traffic safety issues etc. LGRM has no competence to resolve many LAR related issues, like verification of the inventory of losses and repeated valuation of lost assets, but LGRM and stage 1 process should be efficient support for collecting such type grievances and directing them to the RDMRDI central office for further review and resolution under the GRC (stage 2 process). All type of grievances that have not been successfully resolved at the LGRM level through the Stage 1 process, will be redirected to the GRC with the supporting documents describing the efforts of LGRM to resolve the grievance.

A Local Grievance Redress Mechanism (LGRM) is being established as an informal, project- specific grievance redress mechanism to administer the grievances at Stage 1. This informal body will be established at project affected site/community level and will comprise Khobi Municipality and Poti Mayor’s Office. The core team of LGRM will be formed by the local social safeguards/resettlement officers of RDMRDI, Civil Works Contractor and Engineer (Civil

Page 74 || 132 works supervising company - CSC). The chief social safeguards/resettlement specialist of RDMRDI is nominated as a coordinator of LGRM (Coordinator). Currently, the key local resettlement officer of RDMRDI is Mamuka Gelekva. Social safeguards/Resettlement specialist of the Engineer will be nominated as a Secretary of LGRM responsible for establishment and maintenance of the local level grievance log and recording all grievances. Participation of the representatives of Poti Mayor’s Office, Khobi Municipality and local Sakrebulo in LGRM is important, as very often significant part of grievances is directed by PAPs to the local municipalities. Apart from that, there are many issues at local level that may require involvement of local authorities (issues related to determination of the land ownership rights; impacts on community infrastructure, etc.).

After the grievance enters the LGRM through the local entry points (Municipality and contact persons nominated by RDMRDI, CW Contractor, Engineer) or from RDMRDI central office, Coordinator and Secretary of LGRM together with the representative of CW Contractor shall meet with the aggrieved AP and sign the minutes that record the brief description of the grievance, the dates when the grievance is submitted and brief content of the agreements made. After receiving the grievance, the LGRM is the body where the grievance should be redirected and it should be the responsibility of LGRM to fix the grievance and check its validity. Despite the opinion of the CW Contractor, in case if the majority of the LGRM members decide that the damage is subject for compensation by CW Contractor, the CW Contractor is obliged to pay compensation or restore the damaged asset. In case if CW Contractor refuses to fulfil their obligation, the local GRM directs the grievance to RDMRDI and RDMRDI management either enforces CW Contractor to pay compensation, or RDMRDI pays compensation itself and later deducts the compensation amounts from next payments to CW Contractor. More detailed procedure in that regard should be agreed with ADB.

During the meeting with AP, the latest should be informed of the overall grievance mechanism including their right to refuse the solutions offered under the grievance resolution procedures of Stage 1. Grievances submitted are registered in grievance log which is locally managed by the secretary of LGRM and the same logs will be sent to RDMRDI weekly. These logs then are integrated within the entire log system centrally managed by the secretary of GRC (see below). Response should be sent to complainants at this stage together with the minutes and plan of agreed actions within 10 days of the reception of the grievance. If the AP is not satisfied with the solutions offered by the RDMRDI, the grievance case will proceed to Stage 2. This mechanism enables unimpeded implementation of the Project and timely satisfaction of complaints. If the AP is not satisfied, the secretary of LGRM should assist him/her in lodging an official complaint in accordance with the procedures of Stage 2 (the plaintiff should be informed of his/her rights and obligations, rules and procedures of making a complaint, format of complaint, terms of complaint submission, etc.). The secretary of LGRM will assist the AP to collect and submit supplementary documents needed for grievance review at the stage 2 and will supplement the grievance package with notes and documents describing the efforts of LGRM to resolve the grievance at Stage 1.

167. LGRM will be established as informal structure during a meeting in Poti Mayor’s Office and will be fixed by the minutes of meeting. Internal regulations of LGRM will be developed by LGRM Coordinator and will be reviewed and adopted by the majority of LGRM members. The LGRM will include following members:

Page 75 || 132 Table 7-1 Composition of LGRM

(i) The chief social safeguards/resettlement specialist of : Coordinator RDMRDI (Mamuka Gelekva) (ii) ADB Project Coordinator RDMRDI/ETCIC : ADB Monitoring (Archil Jorbenadze) (iii) Representative assigned by Poti Mayor : Member (iv) Representative of Poti Sakrebulo : Member (v) Representative assigned by Gurjaani Municipality : Member (vi) Representative of Sighnagi Municipality : Member (vii) Social safeguards specialist of CW Contractor : Member (viii) Social safeguards specialist of Engineer (CSC) : Member Secretary

Stage 2 – GRC review of AP’s complaint. For Stage 2 of grievance resolution process the RDMRDI has established a Grievance Redress Commission (GRC) as a formal mechanism that will be called upon each time a complaint reaches the Stage 2. GRC notifies the AP about the receipt of the grievance within 10 days, reviews the written complaints of APs, which were not satisfied at Stage 1 or are not of competence of LGRM and, within one month, informs the AP about the decision in compliance with the Administrative Code of Georgia. If the complainant is not satisfied with the decision of GRC, then she or he may proceed with court.

GRC is formed by the order of the Head of RDMRDI as a formal structure, engaging personnel of RDMRDI from all departments having regard to the LAR issues and complaint resolution. Permanent members of GRC include RDMRDI’s top management (Head and Deputy Head of the RDMRDI), Heads of the Resettlement Services and Environmental Services of the RDRD, representatives from the Legal Department, Technical Department, and Public Relations (PR) department. Non-permanent members will include engineers, safeguards consultants, PR consultant and other relevant stakeholders. The internal regulations for the GRC allows if necessary engagement of representative of local authorities, NGOs, auditors, APs and any other persons or entities in the work of commission. The GRC will convene every time a grievance is escalated to stage 2. GRC has an appointed person as a secretary/convener responsible also for keeping the records of the minutes from GRC meetings. GRC has nominated person responsible for monitoring and keeping the log of grievances for this project, as well as other ADB financed projects. The person nominated for this position is Archil Jorbenadze - ADB Project Coordinator RDMRDI/ETCIC. He also ensures compatibility of GRC logs with the grievance log of LGRM. The GRC Monitor is responsible to track implementation of the GRC decision. GRC will be immediately notified if there are delays or hurdles in carrying out the decision. GRC will allocate all necessary resources to ensure implementation of a decision.

Stage 3 – Court decision. If complainants are not satisfied with the decision of the GRC, they have the right to bring the case to the court. The aggrieved AP can take a legal action not only about the amount of compensation but also any other issues, e.g. occupation of their land by the contractor without their consent, damage or loss of their property, restrictions on the use of land/assets, etc. The decision of the court is final.

Page 76 || 132 Table 7-2 Grievance Resolution Process (Proposed Updates)

Stage Responsible GRM Process Stage 1 LGRM The complaint is informally reviewed by the local resettlement officer, which takes all necessary measures to resolve the dispute at local level. The response time is 10 days. The grievance has to be logged. RDMRDI appropriate person have to be informed. Stage 2 GRC of RDMRDI If the grievance is not solved during the negotiations, the local resettlement officer has to assist the aggrieved APs to formally lodge the grievances to the RDMRDI.

GRC. The aggrieved APs shall submit their complaints to the GRC within 1 week after completion of the negotiations at the village level. The aggrieved AP shall produce documents supporting his/her claim. The GRC member secretary has to review the complaint and prepare a Case File for GRC hearing and resolution. A formal hearing has held with the GRC at a date fixed by the GRC member secretary in consultation with Convener and the aggrieved APs. The hearing will include resettlement specialist, social safeguards specialist, and any other relevant employee or consultant. The hearing will be led by the Head of the RDMRDI or by Deputy Head. The decisions from the majority of the members will be considered final from the GRC at Stage 2 and will be issued by the Convener and signed by other members of the GRC. The case record will be updated and the decision will be communicated to the complainant AP. The response period after decision is one week. Step 3 Court decision If the RDMRDI decision fails to satisfy the aggrieved APs, they can pursue further action by submitting their case to the appropriate court of law (Rayon Court). The aggrieved AP can take a legal action not only about the amount of compensation but also any other issues, e.g. occupation of their land by the contractor without their consent, damage or loss of their property, restrictions on the use of land/assets, etc.

7.3 GRC Records and Documentation

RDMRDI headquarters will keep record of received complaints (Grievance Logs) for its use as well as for review by the ADB during regular supervisions.

The records in Grievance Logs include the following information:

• Number of claims • Name and contact details of the claimant

Page 77 || 132 • Date of receiving claim • Form of claim – (oral or written) • The entry point/source that received the claim initially • The brief description of the essence of claim • Identification number or index of the package of documents related to the case • The interim status of the grievance resolution process (key actions planned or agreed: stages, dates and participants of negotiations with the AP with GRC (stage 2) • Final status of the grievance resolution [a) pending; b) closed to satisfaction of both parties; c) Negative decision – GRM denies the claim • Date of the final decision of GRM/ date of closure

Figure 7-1 Resolution of LARP Related Grievances

Rayon Court Expropriatio

Grievance Unresolved Possession Taken Over by RDMRDI Grievance Resolution Working Group Land Transferred to RDMRDI Grievance Unresolved

Grievance Resolution Grievance in GRC Resolved Payment

Negotiation Fails

Negotiation Negotiation Agreement Signed LAR Team/AP Successful

AP (AP)

Page 78 || 132 8 IMPLEMENTATION SCHEDULE

8.1 General

168. The time bound implementation schedule of the LARP has been prepared in consultation with the RDMRDI. All activities related to LAR have been planned to ensure that compensation is paid prior to displacement and commencement of civil works construction. The most important acquisition activity, relating to the privatization process in Georgia, is the legalization of legalizable owners of the identified land parcels for acquisition. The legal status of affected land parcels in the project road in Gurjaani and Sighnagi Municipalities have been identified through title search during the land acquisition and resettlement survey and documentation work in December 2017 - January 2018 and verified and updated during May- June 2019. The titled, non-titled and legalizable owners of land parcels to be acquired have been identified in the survey.

169. This version of the LARP is final. RDMRDI has reviewed and approved this document including compensation package and compensation rates and forwarded to ADB for approval. Tasks for the LARP are divided into (i) Final Preparation including LARP approval; various Initial tasks including legalization of legalizable APs and signing of contracts with APs.; (ii) LARP implementation including processing and making payment of compensation and allowances and (iii) evaluation of implementation. Public consultation, internal monitoring and grievance redress will be undertaken intermittently throughout the project duration. The LAR milestones include (i) approval of LARP, (ii) signing of contract awards, (iii) letter to proceed for civil works construction and (iv) start of physical civil works. A post –implementation evaluation will be carried out after completion of LARP implementation.

8.2 LARP Approval and Initial Tasks

170. The Resettlement Unit of the RDRD under RDMRDI sets up relevant institutions and line up ETCIC, LARC, Working Group/LAR Team, GRC and the like for the Project. Upon completion of the draft LARP from the detail design consultant, the RDRD reviews and approve the document including compensation rates. RD will submit the approved LARPI to ADB for approval. Meanwhile, RDMRDI will implement actions for legalization of legalizable owners listed in the ACS of LARP (ACS) at the field level. All arrangements will be set for signing the contract agreement with the APs and the process will be executed for land purchase and compensation agreements. The capacity building exercise will be enhanced during this stage. Representative of the APs. After completion of legalization of all legalizable owners of land parcels under LARP, RDMRDI will award civil works contracts (signing of contract awards). The initial LAR activities will be the following:

(i) Establishment of LAR Institutions; (ii) Updating of LAR Budgets and ACS; (iii) Confirmation of updated impact data and of compensation amounts; (iv) Approval of LARP by ADB and Government.

Page 79 || 132

8.3 LARP Implementation

171. Payment of compensation and allowances under LARP will commence after a number of preparatory tasks have been completed. These tasks are:

(i) Signing of contacts with APs (ii) Disclosure and consultation (iii) Capacity building training of LAR institutions, APs and NGOs (iv) Grievance resolution (v) Requisition to ETCIC for payment of compensation and allowances (vi) Transfer of compensation and allowance to APs' bank account and registration of land in PR on RDMRDI name (vii) Relocation of affected structures/ assets (viii) Compliance review and reporting (ix) Notice to proceed for Civil works construction (x) Monitoring

8.4 Post Implementation Evaluation

172. The post-implementation evaluation will be conducted after one year of completion of the LARP implementation and upon start of the civil works construction. The Engineer (CSC) could be engaged to execute these tasks. In particular, the international social safeguards specialist of CSC may have the responsibility for the post implementation evaluation.

8.5 LARP Implementation Time Schedule

173. The time bound LARP implementation is presented in Figure 8.1. Land purchase agreements and payment of compensation and allowances will go simultaneously and a sequence of one week time from offer of compensation to agreement, agreement to requisition and requisition to payment transfer is considered.

174. The time bound implementation schedule of the LARP has been prepared in consultation with the RDMRDI. All activities related to LAR have been planned to ensure that compensation is paid prior to displacement and commencement of civil works construction.

LARP Implementation Activities

175. The activities listed below will be undertaken during actual implementation of LARP:

Page 80 || 132 (xi) Sub-division of project affected land parcels and acquisition of portion with project ROW added with orphan land where such need is confirmed (xii) Signing of land acquisition and compensation agreements with APs and completion of sales transactions registration at the NAPR on the name of AP and RDMRDI (xiii) Establishing special accounts (i.e. escrow account) to deposit compensation amounts allocated under the budget for absent, missing APs, including the land parcels whose legitimate possessors could not be located by then (xiv) Capacity building training of LAR institutions, APs and NGOs (xv) Grievance resolution (xvi) Requisition to TRRC for payment of compensation and allowances (xvii) Transfer of compensation and allowance to APs' bank account (xviii) Relocation of affected structures/ assets (xix) Ongoing Internal Monitoring (xx) External Monitoring and preparation of Final Compliance Report (xxi) Notice to proceed for Civil works construction.

LARP Implementation Activities

176. The time bound LARP preparation and implementation schedule is presented in Table 8-1.

Figure 8-1 LARP Implementation Schedule

2019 LARP Tasks May June July August Aeptember October Nov

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 Preparation End of Additional LARP surveys/verification LAR Institutions Establishment AP Consultation

Draft LARP Finalized ADB final review and approval Government approval Disclosure

CW Contract awards signing

Page 81 || 132 2019 LARP Tasks May June July August Aeptember October Nov

1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 Implementation Legalization

AP agreements signing Allocation of LAR budget Transfer of budget to ETCIC Transfer of budget to AP bank account Compensation deposit in Escrow account x unsolved cases Grievance resolution Court proceedings in case of expropriation Relocation of affected structures Compliance report By EMA NOL from ADB to start civi lworks Start of physical construction Internal Monitoring External Monitoring

Page 82 || 132 9 COSTS AND FINANCING

9.1 General

177. The land acquisition and resettlement cost estimate under LARP includes eligible compensation, resettlement allowances and support cost for implementation of LAR tasks. The support cost, which includes administrative expense, is part of the overall project cost. Contingency provisions (@ 10% of the total cost) have also been included to take into account variations from this estimate at the negotiation for contract agreement level. In case of any over-run in cost, RDMRDI will provide additional funds as needed in a timely fashion. RDMRDI through the approval of Ministry of Finance will be responsible for allocating the LAR Budget in advance as part of their overall annual budget planning. Items of LAR cost estimate under LARP are as follows:

(i) Compensation for agricultural, residential and commercial land at replacement value (ii) Compensation for structures and buildings at their replacement cost (iii) Assistance for severely affected AH (iv) Assistance for vulnerable groups for their livelihood restoration (v) Cost for implementation of LARP

9.2 Itemized Budgets

178. The following section deals with calculations for various types of compensation and allowances as per the entitlements and as per the rates determined at current market cost. Compensation will be provided at least at the rates detailed in this LARP although some modification in excess will be possible during the discussions preceding the signing of the contract.

9.2.1 Compensation for Land

Compensation of agricultural land has been derived based on the feedback from the affected people and from the independent evaluator. The land is categorized in to three types such as agricultural (arable), agricultural (residential) and agricultural-commercial. Cost of residual land unviable for cultivation is included in the costs. The costs for various categories of land loss are given in Table 9-1.

Page 83 || 132 Table 9-1 Cost for Land Acquisition (including unviable plots)

Plots Area Cost Rates Total Cost Categories by Land Use and Costs No. (sqm) (GEL/sqm) (GEL)

Compensable land

Type 1. Agricultural (arable) land. 891 647,932 3.5 The land plots of official agricultural/arable 2,267,762 status according to NAPR registration

Type 2. Agricultural (residential) land. 5 9,440 5.0 The land plots of official agricultural/residential status according to NAPR registration (in rural 47,200 areas most of residential land plots have official status of agricultural/residential); The land plots with old, abandoned residential dwellings. Type 3. Agricultural land used for commercial 3 3,123 7,0 purposes (nursery for decorative perennials/ 7.0 21,861 GEL/sqm) Total Land 14 660,495 2,336,823

9.2.2 Land Registration Fees

179. The initial registration of the legalizable AHs is free of charges, however secondary registration of the plots after demarcation is charged by NAPR by 51 GEL per plot. The summary of all expected registration procedures is given in the table 9-2.

Table 9-2: The Summary of Registration Fees Expected during LARP Implementation

Number Unit Rate Amount No Type of Expense Unit measure of Units (GEL) (GEL) Registration of updates of title 1 certificates subdivided land parcels 899 Land parcel 51 45,849

Registration of subdivided land parcels 2 (including 30% of parcels to be 1039 Land parcel 51 52,989 subdivided into 3 3 Registration of Sales Transaction 899 Land parcel 51 45,849 Notary Fees (approximate 4 300 Land parcel 50 15,000 assumption) 5 Sub-total 159,687 Contingencies during registration 6 31,937 (20%) 7 Total Implementation costs 191,624

Page 84 || 132 9.2.3 Compensation for Structures

180. Major structures affected by the project include 3 old, abandoned residential houses owned by 3 households, two ancillary large structures and one storage. The mentioned houses are not used for residential needs and their demolition is not related to the physical relocation of the households. Apart from that, some minor supplementary structures, such as shelters in the vineyard, concrete vessels for vineyard treatment, Clay vessels buried in the soil used for wine storage, wire fences and concrete poles used for fixing the vine plants fall under the impact. The details of the impacts on structures is given in the table 2.5. Details break up is given in Table 9-3.

Table 9-3 Cost of Affected Structures

Affected Compensation Parcel Area No of residential Amount Code (sq.m.) floors property (GEL)

Residential House, 640 120 1 supplementary 72, 120 structures Residential 642 200 1 97, 180 House Residential 641 37 1 39,780 House

Subtotal 357 209,080

Affected Compensation Parcel Area No of residential Amount Code (sq.m.) floors property (GEL)

supplementary 640 83 1 11, 880 structures Supplementary 664 structure in 25 1 3,375 vineyard

682 Larger storage 8 1 1,134

Subtotal 116 16,389

Page 85 || 132 Compensation Compensation Unit No of Amount Supplementary Structures Unit Rate Measure Units (GEL) (GEL)

Shelter in vineyard 500 Number 50 25,000 Concrete vessel used for 300 Number 59 17,700 treatment grape plants Clay vessel for wine storage 1 GEL per liter + transportation 520 Number 4 2,080 cost Poles & wire for fixing single Plant 1 104,243 104,243 vine plants number Light / iron meshed fence 5 parcels 250 1,250

Other (cemented iron poles) 15 Number 15 225

Other (latrine) 300 Number 1 300

Other (metal gate) 250 Number 1 250

Subtotal 151,048 TOTAL COMPENSATION 376,517 FORr STRUCTURES

9.2.4 Compensation for Annual Crops

181. Annual crops are cultivated in total on 94,269sqm of agricultural land. Affected crops identified on the acquired agricultural land are vegetables, maize, beans, potato and strawberries. The total figures are given in Table 9-4.

Table 9-4 Summary of Affected Annual Crops

Compensation Compensation Type of Unit No of Units Unit Rate Amount Annual crop measure (sq.m.) (GEL) (GEL)

Potato 1.6 Kg/sq.m. 5,567 8,907

Bean 0.7 Kg/sq.m. 15,570 24,911

Garlic 1.8 Kg/sq.m. 22,510 36,016

Tomato 1.6 Kg/sq.m. 2,706 4,330

Maize 0.4 Kg/sq.m. 8,976 14,362

Page 86 || 132 Compensation Compensation Type of Unit No of Units Unit Rate Amount Annual crop measure (sq.m.) (GEL) (GEL)

Strawberry 1.2 Kg/sq.m. 8,488 13,581

Pepper 1 Kg/sq.m. 13,702 21,923

Anion 0.8 Kg/sq.m. 2,780 4,448

Other mixed 0.5 Kg/sq.m. 13,970 22,352 veggies

Total 94,269 150,830

9.2.5 Compensation for Trees

182. Clearing right of way will cause felling down of 116,146 productive fruit trees, raspberry bushes and commercially grown saplings under private ownership. Most significant part of tree impact is related to wine grape-trees. Cash compensation is calculated by the licensed valuators based on market value of product, on type, age, and productive value of fruit tree. The details of the impacts on trees is given in the table 9-5.

Table 9-5: Compensation for Trees

Affected Perennials No of affected plants Compensation Amount (GEL)

Vine grapes (including saplings) 104,243 6,891,550

Additional vine grapes affected within the vineyard operational zone (calculated in 15,378 1,053,140 June 2019)

Fruit bearing trees (including saplings) 6,911 1,747,549

Raspberry bushes 520 13,000

Decorative tree saplings 4,467 28,750

TOTAL 131,524 9,733,989

Page 87 || 132

9.2.6 Resettlement Allowances

183. There are various allowances being provided to the AH. These are: (i) Severe Impact Allowance and (ii) Allowance for vulnerable. Following are the description of each category of unit rates proposed for various allowances.

(i) The unit rate for severe impact allowances have been considered based on three months of subsistence minimum the unit rate of 378.9GEL per month per AH39 or 1,137GEL.

(ii) The allowance for vulnerable AP is the same as the one described above for severely affected AH.

184. Details of calculations on various types of allowances are described in Table 9-6.

Table 9-6 Cost for Allowances

No. Item Unit Unit Rate (GEL) Quantity Cost (GEL) 1 Severely AHs Numbers 1,137 615 699,255 2 Vulnerable Households Numbers 1,137 28 31,836

Total 731,091

9.3 LARP Management Cost

185. The Construction Supervision Contractor will conduct external monitoring. However, RDRD RDMRDI will need to employ one independent monitoring agency for external monitoring of LARP implementation for a period of 3 months (in case the Engineer is not in place during updating and implementation of the LARP. Miscellaneous expenses have been kept as a provision to cover the administrative cost as may be incurred during implementation of the LARP. Details of the LARP implementation management cost is given in Table 9-7

Table 9-7 Capacity Building and Management Cost

No. Item Unit Quantity Unit Cost (GEL) Total Cost (GEL)

1 Cost for EMA Months 3 5,000 15,000 Miscellaneous 2 Months 12 3,000 36,000 Administrative Cost Total 51,000

39 These figures are based on data of the GEOSTAT for a family of 5 persons in May 2019.

Page 88 || 132 9.3 Summary LAR Cost and Flow of Funds

186. The total LAR cost calculated for the implementation of this LARP is 14,929,062 GEL (USD 5,356,678). The summary LAR cost estimate is given in Table 9.8. All LAR related funds will be spent in one full year before the start of civil works construction. If the implementation of this LARP covers two fiscals, the allocation of funds will be sought accordingly. The Eurasian Transport Corridor Investment Center (ETCIC) is responsible for financial management of external financed projects. ETCIC will get funds directly from the Ministry of Finance allocated for the project and disburse to APs following requisition from RU, RDMRI.

Table 9-8 Summary Estimate of LAR Costs

No. Item Cost in GEL Cost in USD A Compensation 1 Compensation for Land 2,336,823

2 Land Registration Fees 191,624

3 Compensation for Structures/Buildings 376,517 Compensation for Annual Crops 150,830 Compensation for Trees 9,733,989

Sub Total A 12,789,783 B Allowances 1 Severely AHs 699,255 2 Vulnerable Households 31,836

Sub Total B 731,091 C Support Cost for RP Implementation

1 Cost for EMA 15,000 2 Miscellaneous Administrative Cost 36,000 Sub Total C 51,000 Total R&R Cost (A+B+C) 13,571,874 Contingency @10 % of the total LAR Cost 1,357,188 Grand Total 14,929,062 5,356,678* * Exchange rate of the National Bank of Georgia for June 20, 2019: 1 USD = 2.787 GEL.

9.5 Justification of Cost Estimates and Updating LAR Budget

187. Land acquisition and resettlement surveys included a valuation survey of affected land and assets. The survey consulted relevant transactions in case of land and local markets in case of building, trees and crops. In determining allowances to severely AHs and vulnerable households, the existing subsistence minimum rates have been considered.

188. Multi-floor buildings have been considered for additional costing taking into account the total floor area including all the storeys/floors. A detail measurement survey was

Page 89 || 132 conducted to assess the affected buildings and structures and subsequently a detailed market survey for valuation of each type of affected structure.

189. The prices are, therefore, replacement value at current market cost and ensure full replacement cost to the affected land, building/structures, crops and trees. Detailed methodology followed for determining replace value of affected assets is given in Annex 1.

9.6 Source of Financing

190. All funds for compensation and allowances commensurate to LARP will be provided from the Government of Georgia’s public fund. RDMRDI will ensure the allocation of funds for compensation to be paid for land acquisition and resettlement. RDMRDI will get the budget approved from the Ministry of Finance and allocate in advance the funds for implementation of LARP.

Page 90 || 132 10 MONITORING AND REPORTING

10.1 Introduction

191. The main objective of implementation of LARP is to improve or at least restore the social and livelihood resources of the APs at their pre-project level. The process of implementation should ensure that this objective is achieved over a reasonable time with allocated resources. Therefore, monitoring of the process of updating LARP, its implementation and delivery of institutional and financial assistance to the APs has been designed as an integral part of the overall functioning and management of the Project. RDRD of RDMRDI will ensure the execution of timely monitoring of the monitoring and evaluation (M&E) indicators (process, delivery and impact indicators) of LAR tasks. The purpose of the Monitoring and Evaluation (M&E) is to provide feedback to all stakeholders on progress made in view of a timely and comprehensive implementation of the LARP and to identify problems as early as possible to facilitate well-timed adjustment of implementation arrangements. The objectives are to: (i) ensure that the standard of living of APs are restored or improved; (ii) ascertain whether activities are in progress as per schedule and the timelines are being met; (iii) assess whether the compensation, rehabilitation measures are sufficient; (iv) identify problems or potential issues; and (v) identify methods to rapidly mitigate problems.

10.2 Monitoring and Evaluation Indicators

192. Compliance of the LARP policy and targets in the implementation process will be monitored against set of indicators. These indicators and benchmarks will be judged for implementation process, outcomes and impacts.

10.3 Level of Monitoring

193. Monitoring of LAR task in the Project will be carried out at two levels. The Head of RDRD will carry out regular internal monitoring for the RDMRDI with inputs from LAR teams at field operation. External monitoring will be commissioned by RDMRDI employing an independent external monitoring agency. External monitoring could be executed by the Engineer or construction supervision consultant (CSC) in case, if CSC is available at the time of LARP implementation. The CSC will also carry out supervision and monitoring to assist RDMRDI and ADB in relation with the resettlement impacts at the civil works stage.

10.4 Internal Monitoring

194. Internal monitoring will be carried out routinely by RDRD during implementation of the LARP. The results will be communicated to the LARC and ADB monthly. Indicators for internal monitoring will be those related to process, immediate outputs and impacts. This information will be collected directly from the RDRD representatives in the local level LAR Team and

Page 91 || 132 Working Group and reported to LARC to assess the progress and results of LARP implementation, and to adjust the work program, if necessary. The monthly reports will be quarterly consolidated in the standard supervision reports to ADB.

195. The report of internal monitoring will contain: (i) accomplishment to-date, (ii) objectives attained and not attained during the period, (iii) problems encountered, and (iv) suggested options for corrective measures. The internal monitoring report will primarily be prepared by the RDRD resettlement specialists. The international resettlement specialist with CSC will assist LARC in preparing the overall resettlement status in the PPR in consultation with the national resettlement specialist. However, the national resettlement specialists of CSC will particularly monitor the activities of LAR teams and report to LARC on a monthly basis under the guidance of the international.

10.5 External Monitoring

196. According to the tasks, external monitoring will be carried out by an External Monitoring Agency (EMA) to be selected among NGOs, academic/research institutes or independent consultants or by the Supervision Consultant. The tasks assigned to the EMA will be the external monitoring of LARP implementation and the preparation at its end of a compliance report which will the basis for ADB to provide No objection to the start of civil works. The tasks assigned to the Supervision consultants will be the external monitoring of the compensation of unforeseen impacts that may occur during construction and the Post- compensation evaluation of the degree of AP rehabilitation achieved a year after the LARP was implemented.

10.5.1 EMA Tasks

197. The EMC will closely monitor the implementation of the LARP and engage in the following tasks: (i) review of LARP and Information pamphlet disclosure; (ii) review of action taken by the RDMRDI to compensate the APs with particular attention to the way this action fits the stipulation of the LARP; (iii) review all compensation tallies; (iv) verify whether the compensation is provided thoroughly to all APs and in the amounts defined in the LARP and in the AP contracts; (v) asses the satisfaction of the APs with the information campaign and with the compensation/rehabilitation package offered to them; (vi) review the legalization process and assess its effectiveness; (vii) review complaints & grievances case; (vii) carry out an AP satisfaction survey with 100% of the APs. Immediately after the implementation of the LARP the EMC will prepare the Compliance Report. The report will include well argued sections on the following:

(i) Assessment of the way the compensation has been carried out in relation of the stipulations of the LARP; (ii) Verification that all APs have been compensated in the amounts stipulated in the LARP (iii) Assessment of the accuracy of survey and asset valuation

Page 92 || 132 (iv) Assessment of the effectiveness and thoroughness of the Legalization process (v) Review of complaint and grievance cases and of their solution (vi) Assessment of the rehabilitation program for severely affected and vulnerable APs (vii) Assessment of the satisfaction of the APs (viii) Lesson learned to be applied to the next projects, and; (ix) General assessment of LARP implementation and recommendations to ADB regarding the provision of No Objection Letter to start the civil works.

198. The EMA will carry out its activities in close communication with the RDMRDI and will engage in desk activities and field activities and for this s/he will hire an appropriate number of assistants to carry out the AP satisfaction survey and to review the compensation tallies. The monitoring activities assigned to the consultant will start immediately after Government approval of the LARPs and will last until LARP implementation is concluded.

10.5.2 Post-Implementation Evaluation

199. The CSC resettlement specialists will carry out a post-implementation evaluation of the LARP about a year after completion of its implementation. The compelling reason for this study is to find out if the objectives of the LARP have been attained or not. The benchmark data of socioeconomic survey of severely affected APs conducted during the preparation of the LARP will be used to compare the pre and post project conditions. The post- implementation evaluation will recommend appropriate supplemental assistance for the APs should the outcome of the study show that the objectives of the LARP have not been attained. For this task the CSC will:

(i) Review as needed the survey indicators

(ii) Assess the livelihood impact of the land acquisition/resettlement on the APs through formal and informal surveys with the population in project areas affected and non-affected. The EMC shall conduct a formal survey of a representative sample of men and women APs to determine changes that have occurred on the APs. In parallel the EMC will also compare the situation of the APs with non- affected neighbours similar in terms of livelihood level to the APs. Focus group discussions and other unstructured data gathering methods and consultation with APs, officials and community leaders will also be used in carrying out the evaluation to supplement the findings from the formal survey. Finally the assessment will look into potential differential impact or benefit that men and women have APs experienced from the resettlement activities. The result of the surveys will serve as the end term review report of the CSC for the Project.

(iii) Assess again satisfaction on the valuation of assets and entitlements, timing of payments, fund availability and disbursements. In the same post-LARP survey, the CSC shall ascertain the satisfaction of APs on the valuation of assets, as well as, the scope and timing of assistance provided under the LARP.

Page 93 || 132 (iv) Assess the long-term efficiency, effectiveness and sustainability of the land acquisition/resettlement program, drawing lessons for future resettlement policy formulation and planning and future LARP planning and implementation. Should the outcome of the study show that the LARP objectives have not been attained, the CSC will recommend appropriate supplemental assistance for the APs.

(v) Preparation of the valuation report. Prior to submission of the post-LARP report, the CSC shall ensure that informal and formal meetings are held with the men and women representatives from the APs, community leaders and other key officials and seek feedback on the contents/analysis in the review report. Highlights of these consultations will also be attached as annex to the report.

10.5.3 Monitoring Indicators for Task 2

200. Task 2 will be based among others on the monitoring indicators listed in Table 10-1.

Table 10-1 Monitoring Indicators for Task 2

Monitoring Indicator Basis for Indicators

• Location • Composition and structure: ages, educational and skill levels • Gender of household head • Ethnic group • Access to health, education, utilities, and other social services • Housing type Basic Information on AP • Land and other resource ownership and utilization patterns Households • Occupations and employment patterns • Income sources and levels • Agricultural production data (for rural households) • Participation in neighbourhood or community groups • Access to cultural sites and events • Value of all asset forming entitlements and resettlement entitlements

• What changes have occurred in terms of patterns of occupation, production, and resource use compared to the pre-project situation? • What changes have occurred in income and expenditure patterns compared to the pre-project situation? Benefit Monitoring • What have been the changes in cost of living compared to the pre-project situation? • Have APs’ incomes kept pace with these changes? • What changes have taken place in key social and cultural parameters relating to living standards?

• Were house compensations made free of depreciation, fees or transfer Restoration of Living costs to the APs? Standards • Have perceptions of community been changed? • Have the AP achieved replacement of key social and cultural elements?

Page 94 || 132 Monitoring Indicator Basis for Indicators

• Were compensation payments free of deduction for depreciation, fees or transfer costs to the AP? • Were compensation payments sufficient to replace lost assets? • Was sufficient replacement land available of suitable standard? • Did transfer and relocation payments cover these costs? Restoration of Livelihood • Did income substitution allow for re-establishment of enterprises and production? • Have enterprises affected received sufficient assistance to re-establish themselves? • Do jobs provided restore pre-project income levels and living standards?

• How much does the AP know about resettlement, procedures and entitlements? • Do they know if these have been met? • How do the AP assess the extent to which their own living standards and Levels of AP Satisfaction livelihoods? • Have been restored? • How much does the AP know about grievance and conflict resolution procedures? • How did resettlement implementers deal with unforeseen problems?

• Were the AP and their assets correctly enumerated? • Were land speculators assisted? Effectiveness of • Was the time frame and budget sufficient to meet objectives? Resettlement Planning • Were entitlements too appropriate (wide or narrow)? • Were vulnerable groups identified and assisted?

• Were there unintended environmental impacts? Other Impacts • Were there unintended impacts on employment or incomes?

Page 95 || 132

Annexes

Page 96 || 132 Annex 1 Valuation Methods, Valuation of Losses and Compensations

Valuation of the Cost of Buildings and Structures

1 Land Valuation

Land has been valued at replacement cost based on the average market value. That is based on the average sale value of comparable land in type, location and features. Based on the average market sales, adjustments were made according to the comparison parameters, in the following sequence as applicable:

(i) Transfer of ownership rights for the real estate property; (ii) Financial conditions; (iii) Sale conditions; (iv) Further costs related to sale; (v) Sales dynamics at the market (the sale date); (vi) Location; (vii) Physical parameters; (viii) Economic parameters; (ix) Use; (x) Existence of real estate property.

2 Calculation of the market prices of the land plots with a sales comparison method

The Market Method (sales comparison method) was used as one of the basic approaches defined by the International Valuation Standard (IVS-2013 9th edition) to determine the amount of compensation for inflicting land losses on landowners.

Approach When applying Market Method, the valuer establishes an assumption about the value by comparing the objects of comparison property with the objects of the property of the valuation. Procedure „In applying Market Method approach, a valuer follows a systematic procedure. The valuer will: – Research the market... – Verify the information... – Select relevant sample objects (land plots) of comparison…

Page 97 || 132 – Compare the sale properties with the subject property using the elements of comparison… – Reconcile the results into a value indication…“ /International Valuation Guidance GN 1. Real Property Valuation/ Elements Elements of comparison determine the specific features of properties and transactions that of explain the prices to vary. The market analysis reveals which elements are particularly comparison sensitive. Sales comparative data analysis involves comparison of the following elements: • Real property rights conveyed... • Financing terms... • Sale conditions... • Expenditures made immediately after purchase... • Market conditions... • Location... • Physical characteristics… • Economic characteristics... • Use... • Non-realty components of sale...

That is, market or sales comparative analysis method at the time of determining the value of the object to be evaluated is based on its direct comparison with prices for similar items sold in the recent past or announced for sale.

The following successive actions were taken by the independent valuator to determine the market value of the property to be evaluated using the market method in accordance with the above-mentioned standard: market data on similar real estate objects to be evaluated were collected and analyzed; the detailed market research was carried out, reliable information on factors affecting the value of the object to be evaluated was obtained; the collected information was rechecked in order to affirm its accuracy and nature of motivation behind each transaction; an applicable unit of comparison was determined and a comparative analysis carried out; comparison of the objects to be evaluated with the selected object to adjust their selling price or extract from the list of objects of comparison; and the reduction of the adjusted indicators of the value of the objects of comparison to a single value or market value range were performed. The market value of the objects to be evaluated was determined.

As already mentioned above, in order to determine the value of affected land plots to be evaluated, there was used market or sales comparison method, which includes comparison of the object to be evaluated with other objects, the market value of which is known (selling and buying of land was undertaken, i.e., was sold in the recent past or announced its sale).

The following types of the compensable private land groups were identified:

. Arable agricultural according to NAPR classification . Agricultural (residential) – the agricultural land used in rural settlement areas as residential plots . Agricultural land used for commercial needs (sapling nursery)

Page 98 || 132 In order to evaluate the land plots, the relevant market segment and values under the agreements and contracts concluded for similar real estate on the territories of the above-said villages and their adjacent villages must be considered.

Aiming at fixing the market values in the course of evaluation, we obtained the data about similar properties based on the present market offers and data of the agreements provided by the National Agency of the Public Registry (NAPR) (the sources of information are referred to in the table below) given in Table A1.

In addition, it should be noted that NAPR has too scarce information about selling and buying the land plots in the project area. The analog samples to fix the market prices of the lands were obtained based on the agreements concluded for the compensation amounts paid for the land plots expropriated with the similar purpose. The information received as a result of the oral questioning of the population was also taken into account.

In order to evaluate the land plots, the market segment and fixed values under the agreements and contracts concluded for similar real estate must be considered. Valuation was carried out within the boundaries of the aforementioned territory and nearby borders.

Fixing Land Compensation Value

After considering the analogues and studying the data and corrected prices, the value of the unit land was fixed by calculating the mean weighted value. When agreeing with the results of the corrected prices, the analogues being most comparative to the objects to be evaluated and with least corrections were given the highest specific weight.

The market value of the unit of the land plots to be evaluated (by using the mean weighted value) was calculated with the following formula:

Vwa = ∑ Pi * ( Ri / ∑ R)

i=1 i =1

Vwa – mean weighted value;

Pi – corrected price of each analogue;

∑ R – the sum of the rated weights of the corrected prices of the analogues of comparison;

Ri – rated weight of the corrected price of each object of comparison.

Consequently, the calculation of the market value of the object to be evaluated by using the mean weighted value is given in the tables.

Finally, the cost of land for all three types of plots is presented in table below

Page 99 || 132 Category of Affected Land Compensation Unit Rate (GEL) Arable agricultural 3.5 GEL / sq.m. Rural residential 5.00 GEL /sq.m. Agricultural land used for sapling nursery 7.00 GEL /sq.m.

2. Buildings Valuation. Buildings have been valued at replacement cost based on the direct and indirect costs at market value necessary for the construction of a comparable building i.e. what construction of a building of similar parameters would cost today. No deductions were made for amortization. The parameters for calculating the direct and indirect costs are the following as applicable to individual cases.

a. Direct costs include: (i) Salaries of workers; (ii) Purchase of construction materials; (iii) Preparatory expenses; (iv) Rent or purchase of equipment; (v) Profit and overhead expenses of the constructor; (vi) Expenses incurred to ensure safety measures during the construction/repair; (vii) The cost of arranging temporary structures; (viii) Temporary communications (electricity, water, gas supply etc.); (ix) Warehouse costs; (x) Transportation costs; (xi) Other costs b Indirect costs include: (i) Cost of professional services: 1. Compensation of the architect/designer; 2. Compensation for engineering services; 3. Legal expenses; 4. Compensation for valuator’s services; 5. Other expenses (ii) Expenses incurred to receive permits; (iii) Insurance costs; (iv) Financing %; (v) Guarantee necessary to secure the contract implementation by the contractor building the new building; (vi) Other expenses

Page 100 || 132

Annex 2

Information Leaflet Distributed During the Public Consultation Meetings Conducted in 2018 Under the WB Procedures

Land Acquisition and Resettlement Policy

Public Information Booklet

Land Acquisition and Resettlement Plan

For

Bakurtsikhe – Tsnori Bypass Road Construction Project

Prepared by Roads Department of Georgia

July 3, 2018

Page 101 || 132 Preface

Dear Reader,

This Information Pamphlet was developed for you to share the information about the land acquisition procedures required for implementation for Bakurtsikhe-Tsnori new by-pass road construction purposes. This public document describes the location of the project and scope of the scheduled works. Additionally, it describes the compensation policy and procedures for implementation of the Resettlement Action Plan (LARP) prepared by the Consultant for the Roads Department of Georgia by the support form World Bank.

Introduction

In 2011, the Government of Georgia developed a ten-point economic program with the goal of facilitating job creation and improving welfare of the population. Among the top ten priorities was improvement to the infrastructure, particularly roadways. This program places a special emphasis on the rehabilitation of secondary and local roads.

Existing roads that pass through village settlements are affected. Vibration caused by large heavily laden trailers conveying cargo from Turkey to Azerbaijan are often causing damage to roads and roadside residential dwellings, in addition to environmental pollution from exhaust fumes and contaminating local water as generated by heavy traffic that leads to discontent amongst local homeowners.

Pursuant to the terms and conditions of the loan agreement, the Roads Department selected KOCKS Consulting Company to prepare a Resettlement Action Plan (LARP) in compliance with the legislation of Georgia, and preliminarily approved Resettlement Policy Framework (RPF) and World Bank’s OP 4.12 Involuntary Resettlement Policy.

In agreement with RDMRDI, the detailed design was prepared for the selected alternative alignment and which avoiding the residential areas, traverses State and privately owned agricultural land parcels of six villages of Gurjaani and Sighnaghi rayons. In accordance with established practice, road construction activities will be carried out within the identified ROW and will require acquisition of project affected private land parcels in lieu of fair and reasonable compensation.

To adequately address land acquisition and related economic and social impacts, compensation entitlements and maintenance of livelihood of project affected people, the Roads Department has prepared a draft LARP in compliance with the applicable laws of Georgia, approved RPF and WB OP 4.12. on Involuntary Resettlement.

Page 102 || 132 LARP Preparation Activities

During the draft LARP preparation, the following activities were undertaken:  Review of officially available data at the NAPR on land parcels registered under systematic and sporadic registration;  Preparation of the initial list of project affected land parcels and their owners/possessors;  Onsite identification of central line, ROW boundaries and enumeration of project affected land parcels;  Census and collection of socio-economic data on each located project affected household;  Demarcation and survey of all project affected land parcels in the presence of owner, or owner's legitimate representative, owners of the adjacent land parcels, representatives of local government and municipality;  Inventory of project affected assets being determined during demarcation and land survey in the presence of the owner, or owner's legitimate representative and representatives of local government and municipality;  Project affected land parcels where the owner or legitimate possessor was unknown were still surveyed, and project affected perennials were recorded in the inventory act;  Additional in situ examination of project affected assets was conducted by the licensed valuator who conducted desk studies on current market prices on fruits, crops, construction materials and market research on secondary land sales prior to preparation of valuation report and determination of compensation unit rates for affected land and assets;  Additional title search in coordination with APs aiming to assist AHs in the process of title registration for project affected land parcels prior to submission of the final draft LARP for review and issuance of no objection, and  Preparation of cash compensation package separately per each project affected land parcel and broken down per type and volume of impacts subject to cash compensation. According to the data analyses, a total of nine hundred and nine project affected land parcels will be affected by the proposed project design.

Table 1. Summary of Project Impact

No. Description Unit Number

Land Tenure Patterns 1 Total of project affected land parcels No. 916 Sq.m. 705,735 2 Total of State-owned land parcels No 17 Sq.m. 45,240 3 Total of project affected private land parcels No 899 Sq.m. 660,495 4 Category 1. Land parcels with updated registration at the NAPR 437 5 Category 2. Land parcels undergoing title registration update at the NAPR 431 6 Category 3. Land parcels with landowners to be identified/confirmed (possible 31 need for legalization) Land Use and Compensation Categories 7 Type 1: Arable agricultural land used for agricultural purposes (3.50 No. 891 GEL/sq.m.) sq.m 647,932 8 Type 2: Rural residential land parcels attached with vacated residential No. 5 dwellings (5.00 GEL/sq.m). sq.m 9,440 9 Type 3: Agricultural land parcels used for saplings nursery (7.00 GEL/sq.m.) No. 3

Page 103 || 132 sq.m 3,123 Agricultural Patterns Annual Crops No 7 10 Area under bean sq.m 15,570 No 6 11 Area under potato sq.m 5,567 No 3 12 Area under onion sq.m 2,780 No 27 13 Area under garlic sq.m 22,510 No 6 14 Area under tomato sq.m 2,706 No 12 15 Area under pepper sq.m 13,702 No 2 16 Area under cucumber sq.m 1.350 No 12 17 Area under maize sq.m 8,976 No 8 18 Area under mixed veggies sq.m 13,970 No 16 19 Area under Strawberries sq.m 8,488 Affected Perennials 20 Land parcels with affected grapes plants No 347 21 Total of affected grape plants (including standing saplings) No 104,243 22 Land parcels with affected fruit bearing trees No 696 23 Total of affected fruit bearing trees (including standing saplings) No 6,911 24 Land parcels with affected raspberry bushes No 1 25 Total of affected raspberry bushes No 520 26 Land parcels with affected saplings nursery No 3 27 Total of affected saplings No 4,467 Affected Structures No Residential Houses No 10 28 Vacated residential houses built of stone and bricks No 3 29 Auxiliary structures attached to affected rural residential land parcels No 3 Minor developments 30 Simple sheds standing in the agricultural land parcels built of wooden and No 50 metal poles with asbestos roofing 31 Concrete vessel used for treatment grape plants No 59 32 Clay vessel for wine storage No 4 33 Agricultural land parcels with minor developments, such as fences made of No 13 wooden/metal poles, latrine, iron gates, etc. Affected Households 34 Total of affected households No. 720 35 Total of affected persons No 1787 36 Male affected No 900 37 Females affected No 887 38 Severely affected Households No. 615 39 Vulnerable Households No 28 40 Resettled households No. 0 41 Number of AHs losing arable agricultural land parcels used for agricultural No 717 purposes 42 Number of AHs losing residential land parcels attached with vacated No. 3 residential dwellings 43 Number of AH losing agricultural land parcel used as sapling nursery No 1

Page 104 || 132

WORLD BANK Requirements on Involuntary Resettlement (WB OP 4.12)

Specific World Bank requirements concerning resettlement are contained in the Operational Policy (OP. 4.12) on Involuntary Resettlement that is based on the following principles:

 Involuntary resettlement should be avoided in all cases where feasible, and where it is not possible to avoid resettlement, it should be kept at a minimum;  Where it is necessary to carry out resettlement, it should be treated as a development programme providing efficient resources for a new investment to a displaced person;  Persons affected by resettlement shall be fully informed and shall have the opportunity to participate in procedures with a view to protecting and exercising the rights which they are entitled to;  Displaced persons shall be assisted in their efforts to improve their income and standards of living, or at least to restore them to and keep them at pre-displacement levels;  The obligation to assist displaced persons and to provide them with appropriate protection shall exist regardless of how they have acquired property and possession, i.e. regardless of their legality (thus, also when displaced persons have no legal basis and they are unlawful users);  Displaced persons shall be ensured full payment of replacement costs and a compensation for the property taken, in the amount which enables the compensation or replacement of the property taken with an alternative.

Page 105 || 132 Legal-Regulatory Framework

Specific laws and normative acts provide corresponding compensation of resettlement costs at market value. Legislation determines the types of loss subject to compensation and defines the compensation that should be issued for damaged assets as well as lost income. Pursuant to the legislation, consultations and notifications are important to ensure participatory involvement of project affected persons in the process of project preparation and implementation.

Under active legislation, during the implementation of resettlement action plan, the following mechanisms are to be undertaken:

a. Acquisition of project affected land and assets located within the ROW through the negotiation and issuance of defined compensation prior to the commencement of civil works; b. Exercising the right of expropriation based on the Court decision and after issuance of defined compensation in case the negotiations fail.

The Essence of the Cut-off Date

Compensation eligibility is limited to APs by a cut-off date, December 1, 2017. For the proposed road project, the suggested cut-off date is the start date of the DMS and PAPs census survey.

AHs who settle in the affected areas after the cut-off date will not be eligible for compensation, as they will be classified as illegal encroachers. These AHs, if any detected within the project ROW, will be given three months advance notice to vacate premises and dismantle structures, if any prior to project implementation. Their dismantled structures will not be confiscated, and they will not be penalized or sanctioned. Indeed, forced eviction will only be considered following exhaustion of all other efforts.

Validity Period of Valuation Report and Unit Rates

The unit rates determined based on the Valuation Report prepared by the licensed valuator for the specific project is valid with in the reasonable time period depending on the trends of price fluctuation and real property market activity and number of factors that may influence current market value at the local real estate market sub-segment. Anyhow, if more than a year has passed between the time of valuation and the time of compensation the unit rates will be revised and if needed a new valuation report be prepared prior to commencement of land acquisition and issuance of cash compensations to APs.

Official Fees and Taxation

Within the framework of the project the APs will not be liable for income tax incurred as a result of received cash compensation and eventual registration fees for subdivision of project affected land parcels and sales transaction. Such costs will be covered by the Executing Agency; Income Tax will be covered by EA unless waived by the Government of Georgia.

Additionally, charges to cover bank service fees will be included in addition to the amount of cash compensation to be received by APs at the banks.

Escrow Accounts

Amount of cash compensation will be deposited on the special account under authorization of

Page 106 || 132 the Roads Department if during LARP implementation process any AP is missing, absent, or deceased and issuance of compensation is postponed due to legal procedures.

APs with bank Loans and Mortgaged Project Affected Assets APs holding financial liabilities or bank loans using as project affected assets as collateral will be given a choice: a. RD will transfer compensation amount to the bank to cover the mortgage loan and the remaining amount to be wired to the AP; or b. RD will deposit the amount of compensation of the special account (i.e. escrow account) until APs settle bank loan and only afterwards the cash will be transferred to APs’ personal account.

Compensation Entitlements

Entitlements and additional allowances to compensate all type of income and assets loss identified in the context of this specific project are described in the Annex 2. Entitlement Matrix presented in the Appendices.

An independent licensed valuator has been deployed to prepare Valuation Report40 and determine compensation unit rates per each type of affected assets (land, structure, perennials and annual crops) at replacement cost according to the current market price. While, the amount of one-time allowances, additionally allocated to severely affected and vulnerable APs, are defined based on the compensation principles stipulated in the approved RPF and the good practice examples.

Project Affected Land Land replacement cost at current market value is determined by the licensed appraiser based on the most applicable appraisal method of the International Valuation Standards (IVS), in particular Sales Comparison Approach, often called as Market Approach. The Licensed independent appraiser used Sales Comparison approach to derive the value indication by comparing the subject being appraised to similar properties that have been sold recently.

Project Affected Structures Construction cost of project affected structures was also determined by independent licensed appraiser. Valuation of structures considered size of the structure (square meters and number of floors), and construction materials used. In determining replacement cost or design of replacement structures, depreciation of the asset and the value of salvageable materials was not taken into account in compliance with the relevant RPF stipulation.

Project Affected Annual Crops Cash compensation for annual crops are calculated at current market rate by default at gross crop value of expected harvest for one year.

Non-Fruit Bearing Perennials No cash compensation will be issued for perennials not bearing fruits. Construction Company ensures free logging and delivery of timber to the residence of APs. Decorative Perennials grown for commercial purposes Only one AH who owns three agricultural land parcel used for growing samplings of over- green perennials will be cash compensated in accordance to current market prices and personal financial records of AP. Fruit - bearing perennials

40 The Valuation Report developed in Georgian language is being presented to the Roads Department and is readily available upon request of interested APs.

Page 107 || 132 Cash compensation at market value based on type, age, and productive value of fruit tree. In addition, compensation for each fruit bearing tree will be available for the purchase of saplings and planting on the remaining portion or on a newly allocated replacement land parcel. Additionally, the Construction Company ensures free delivery of timber to the residence of AHs.

Page 108 || 132 Grievance Redress Mechanism to Address Grievances and Complaints

The Grievance Redress Commission (GRC) will be operating during the entire project cycle. The role and responsibility of the GRC is to accept claims and complaints, assess its validity, determine the scope of eventual impacts, and timely resolve the issue, including the claims regarding the compensation and maintain grievance redress mechanism as flexible and efficient mechanism to address and resolve the claims as raised during project planning and implementation period. Claims and complaints41 filed during within the framework of this project will be revised according to the below described procedures.

Grievance Redress cycle

Steps Action level Process Step 1 Negotiations with APs The complaint is informally reviewed by the grievance redress committee (GRC), which takes all necessary measures to resolve the dispute amicably.

Step 2 GRC Resolution If the grievance is not solved during the negotiations, the GRC will assist the aggrieved APs to formally lodge the grievances to the GRC. The aggrieved APs shall submit their complaints to the GRC within 1 week after completion of the negotiations at the village level. The aggrieved AP shall produce documents supporting his/her claim. The GRC member secretary will review the complaint and prepare a Case File for GRC hearing and resolution. A formal hearing will be held with the GRC at a date fixed by the GRC member secretary in consultation with Convener and the aggrieved APs. On the date of hearing, the aggrieved AP will appear before the GRC at the Gamgeoba office for consideration of grievance. The member secretary will note down the statements of the complainant and document all details of the claim. Response time for the GRC to acknowledge receipt is 14 days and after date of hearing for Respond/resolve maximum time is 10 days. The decisions from majority of the members will be considered final from the GRC at Stage 1 and will be issued by the Convener and signed by other members of the GRC. The case record will be updated, and the decision will be communicated to the complainant AP.

Step 3 Decision from central If any aggrieved AP is unsatisfied with the GRC decision, the RDMRDI next option will be to lodge grievances to the RDMRDI at the national level. The RDMRDI shall review the complaint in compliance with the procedures specified in the Administrative Code of Georgia. GRC should assist the plaintiff with lodging an official complaint (the plaintiff should be informed of his/her rights and obligations, rules and procedures of making a complaint, format of complaint, terms of complaint submission, etc.).

The plaintiff shall be informed of the decision.

41 The Copy of the Grievance Form is attached in the Annex 1 of the Public Information Booklet.

Page 109 || 132 Steps Action level Process Step 4 Court decision If the RDMRDI decision fails to satisfy the aggrieved APs, they can pursue further action by submitting their case to the appropriate court of law (Rayon Court) without any reprisal.

Contact Information Roads Department of Georgia Address: Georgia 0160, Tbilisi, Kazbegi Ave N12, Ms. Nino Mtsuravishvili, Deputy Head of Resettlement Department of RDMRDI Mobile: 555 400 205 Ms. Mariam Begiashvili, Social Safeguards and resettlement Consultant of RDMRDI for WB funded projects Mobile: 595 026 688

Page 110 || 132 Project Implementation Schedule

Nov Dec Jan Feb Mar April May June July Aug Sep Oct Nov Dec Jan Feb Mar Activities/ Months 2017 2017 2018 2018 2018 2018 2018 2018 2018 2018 2018 2018 2018 2018 2019 2019 2019

Activities Public Orientation Meetings, provision of consultancy at AP’s request Enumeration, demarcation and survey of project affected parcels Census, SES, Inventory Title Search, preparation of documents to process registration of titles Deploying Valuator /Inventory

& appraisal Data analyses Developments of initial draft LARP & tentative estimated budget Announcement of LARP

Disclosure Meetings Revision, update and issuance of Final Draft LARP, upload on the websites Approval of ADB-No

Objection to Final LARP and

Page 111 || 132 implementation commencement LARP Implementation: negotiations, land acquisition and issuance of compensations Technical Assistance to APs (registration updates, legal consultancy) Negotiations & Cash

Compensation of AHs Processing Sales Agreements & Issuance of Compensations Internal Monitoring, Resolving outstanding issues & grievance redress External Monitoring of LARP implementation results Construction Contract award

Page 112 || 132 Annex 1. Grievance Form

Grievance Form

Section of Complainant:

Full Name: Mailing/Permanent Residence Address: ______Village: ------______Municipality: ------

Preferred option of communication: Mark with X Contacts

Response mailed to: Mobile: ------______Face-to-face meeting in GR Focal Point Landline: ------______E-mail: ------

Language for Communication (mark with X) Georgian Other______(please specify)

Complain submission date: Date of hearing:

Please, describe the reason of your discontent or claim in detail. Use extra pages if needed.

Present copies of the relevant documents, if available

Complainant: Received by: Full Name: ______Full Name: ______

Signature: ______Signature: ______

Date: ______Date: ______

Page 113 || 132 Annex 2. Compensation Unit Rates

Table I. Land Compensation Unit Rates

Category of Affected Land Compensation Unit Rate (GEL) Arable agricultural 3.5 GEL / sq.m. Rural residential 5.00 GEL /sq.m. Agricultural land used for sapling nursery 7.00 GEL /sq.m.

Table II. Compensation Unit Rates for Stand-alone Affected Assets

Affected asset Compensation Unit Rate (GEL) Shelter in vineyard 500 Concrete vessel used for vineyard treatment 300 Clay vessel for wine storage 1 GEL per liter + 350 – 550 GEL according to vessel transportation cost capacity Price of wires and poles for vineyards to be added 1 GEL/ single vine plant to the compensation unit rate for single vine plant Light Fence/iron meshed fence 5 GEL/ Linear Meter

Table III. Annual Crops Compensation Unit Rates

Project Affected Annual Annual Income Compensation Unit Rate GEL / sq.m. Crops GEL/ha Potato 15600 1.56

Bean 7000 0.70 Garlic 8000 0.80 Tomato 16000 1.60 Corn 4000 0.40

Strawberry 11900 1.19

Mulberry 6000 0.60

Pepper 600 0.06

Onion 18000 1.80

Other veggies (mixed) 5000 0.50

Page 114 || 132 Table IV. Compensation Unit Rates for Fruit –bearing Perennials as agreed with the APs

Fruit bearing perennial Sapling / Semi-productive / Full Productive / GEL GEL GEL Cherry 10 70 180

Peach 5 70 190

Apricot 8 60 200

Walnut 10 530 1260

Quince 8 50 160

Pear 10 110 430

Mulberry 10 70 170

Nut 5 50 110

Plum/ Sour Plum 10 60 180

Apple 10 110 320

Vine yard 5 25 65

Cornelian cherry 5 20 50

Persimmon 5 40 140

Fig 10 70 210

Pomegranate 10 100 370

Berries 10 20 40

Barberries 5 30 60

Buckthorn 5 35 75

Mespilus 10 50 150

Sisyphus 10 135 450

Jonjol tree 5 40 100

Page 115 || 132 Annex 3. Compensation Entitlement Matrix

Type of Impact Application Definition of AP Compensation Entitlements Permanent All land losses APs APs will receive cash compensation calculated at full replacement cost at current market loss of all types independent (with fully registered value42 to be sufficient to purchase land parcel of equal size, location, soil of land (arable, from impact title) productivity/designation to project affected land parcel. Method for calculation of full residential, severity replacement cost besides the value of affected asset will also include cost of preparation of industrial, the land to levels similar to those of the affected land. commercial) AHs will be free of taxes, land parcel sub-division and transaction registration costs. The taxes and fee related to processing transaction registration will be covered by the Executing Agency.

“Orphan land “ All APs holding land If any remaining part of the land owned by the registered owners is no longer be title appropriately used, such remaining part will also be purchased subject to the agreement with the owner. Cash compensation will be calculated as usual at full replacement cost at current market value as applicable to the cases of permanent loss of land for title holders/legitimate possessors.

All APs holding APs who use more APs who possess captured land will not be cash compensated, unless registered in the excess area then allocated NAPR according to the decision of land legalization commission. (surplus) land43 under title documents However, any loss of annual crops and other improvements will be cash compensated in cash at full market rate for annual harvest to be paid to land-user.

Agricultural Leaseholder Leaseholder will receive cash compensation according to current market price in proportion land cultivating project of his/her share of yield. leaseholder affected land with/without written lease agreement and paying rent from received income

42 Detailed description of replacement cost at current market value is described in the Section: Methodology for valuation and determination of unit rates. 43 Excess (surplus) land refers to the cases when AP uses more area of land than as shown in documents originating land ownership rights. Such cases will be transferred for the review and approval /rejection of local land legalization commission prior to updating the registration.

Page 116 || 132 Type of Impact Application Definition of AP Compensation Entitlements Structures Any structure APs with/without Cash compensation at full replacement costs calculated at current market value of project subject to registered, including affected structures and fixed assets free of depreciation, without deducting cost for salvaged demolition for squatters materials and transaction costs. project purposes

Relocation Transport and All APs affected Provision of sufficient allowance to cover transport expenses and livelihood expenses for one transitional by relocation month. livelihood allowances

Annual Crops Crops grown on All APs (including Crop compensation in cash at gross market value of actual or expected harvest. entire area of squatters) Compensation for this item will be provided even in case if the crops were harvested. affected land parcel

Perennials Project affected All APs (including Cash compensation at market value on the basis of type, age, and productive value of fruit standing on Fruit bearing squatters) tree; Each fruit bearing tree in addition shall be compensated for purchase of saplings. private land perennials APs will be eligible to dispose logged trees themselves. parcels Construction company ensures free logging and delivery of timber to the residence of APs. Project affected All APs (including Timber trees/non-fruit bearing perennials: No cash compensation will be issued for non-fruit squatters) perennials not bearing fruits. APs will be eligible to dispose logged trees themselves. bearing Construction Company ensures free logging and delivery of timber to the residence of APs. perennials Perennials Standing trees Perennials standing Construction Company will deliver logged down trees and transfer to the Municipality. (on outside of private land Municipality may later distribute to local population who are below poverty levels. public/State land) Community Access shall be maintained or reinstated; Rehabilitation/substitution of the affected Resources structures/utilities (i.e. bridges, roads, schools, health-centers, potable water supply systems, irrigation channels, etc.) Vulnerable APs below poverty In addition to compensation for assets and income loss, one-time allowance set to be three Ahs line; disabled people; (3) months payment of the minimum monthly subsistence income level for the family of five44. pensioners; widows; The amount of compensation (1025.70 GEL) is calculated based on the information obtained

44 The amount of minimum monthly subsistence income level for the family of five members obtained from the official website of the Department of Statistics for July 2018; In particular: 341.90 X 3= 1025.70 GEL Source: http://www.geostat.ge/index.php?action=page&p_id=179&lang=eng.

Page 117 || 132 Type of Impact Application Definition of AP Compensation Entitlements Female headed from the official website of the Department of Statistics by July 2018. households; Additionally, other capable family members of vulnerable group will be given priority in impoverished; IDPs; employment in project-related jobs. Refugees. Severely AHs losing 10% In addition to compensation for assets and income loss, one-time allowance set to be three Affected AHs and more of (3) months payment of the minimum monthly subsistence income level for the family of five45. income The amount of compensation (1025.70 GEL) is calculated based on the information obtained generating land from the official website of the Department of Statistics by July 2018. Additionally, other capable family members of vulnerable group will be given priority in employment in project-related jobs.

Temporary Loss of access Landowners/Users/loc Temporary access will be set up by Construction Company. impact to land parcel al business Temporary loss Landowners/Users/loc During camps' site selection process Construction Company should coordinate with relevant of income al business state agencies and give priority to vacant lands not used for agricultural /residential caused by purposes. But in case the land parcels selected for camps and quarries will have private occupying land land-users, all losses and amount of due compensation shall be determined according to the parcels for the principles of compensation entitlements provided under this LARP and relevant RPF. camps and quarries Any other As required Any As required, in the spirit of relevant RPF and as stipulated in this LARP. unforeseen Impacts

45 Same as above.

Page 118 || 132 Annex 3 Consultation Meetings on Resettlement Matters Project- Affected People

Draft RAP Disclosure Public Meetings Conducted in 2018 Under the WB LAR Procedures

Minutes of Public Disclosure Meeting Resettlement Action Plan for Bakurtsikhe-Tsnori New 16 km Bypass Project

Date: July 3, 2018 Time: 12.00 PM Location: Meeting Hall of Gurjaani Municipality

Participants: Archil Khandamashvili – Mayor of Gurjaani Municipality Mariam Begiashvili - Social Safeguards and Resettlement Consultant, RDMRDI consultant for WB David Orjonikidze - RDMRDI Lela Shatirishvili – Senior Social Safeguards and Resettlement Consultant, KOCKS Project affected persons, residents of Bakurtsikhe and Kardanakhi villages: 3 female and 30 male

On July 3, 2018 an official Public Disclosure Meeting was held in Gurjaani Municipality (Meeting Hall) to engage stakeholders on the Draft RAP of Bakurtsikhe-Tsnori new bypass road construction project supported by WB and GOG and implemented by the Roads Department of Georgia.

The Public Disclosure Meeting was attended by representatives of RDMRDI, Municipality of Gurjaani, Bakurtsikhe and Kardanakhi Municipalities and project affected persons.

Mr. Archil Khandamashvili, opened the meeting and raised pertinent issues relating to benefits of the project, including economic benefits, increased safety for road users and local population, reduced delivery time to markets, and increased potential for job opportunities.

The opening speech was followed by a Power Point Presentation by Mrs. Shatirishvili. Mrs. Shatirishvili briefly described major aspects and objectives of the project and the draft RAP prepared in compliance with the active legislation of Georgia, the approved RPF, and WB OP 4.12. Describing the activities undertaken during RAP preparation, she highlighted their importance to developing fair compensation packages for each and every project affected household. She also described and elaborated upon the method of calculation of the compensation unit rates for annual crops, perennials and replacement saplings; she also described the additional one-time allowance allocated for vulnerable households and owners of severely affected land parcels. Additionally, Mrs. Shatirishvili explained the importance of the cut-off date, December 1, 2017, as defined for this project, and referenced the legislative instruments as adopted in general practice during implementation of land acquisition and resettlement projects. At the end of the presentation, reference was made to the Grievance Redress Mechanism and GRC as it operated during the entire cycle of the project. Concluding the presentation, Information Booklets carrying compensation unit rates were distributed to every AP, and the panel was opened to the question-answer session. Table A describes the results of Question-Answer Session.

The official Public Meeting was then closed.

Page 119 || 132 Table A. Questions raised by the APs and the answers provided by the Public Meeting Organizers

# Name of AP Question raised Answer provided by the Consultant 1 This question When is expected Civil works and construction activities will start after was asked by the commencement the Construction Contractor and Supervision many APs of Construction Company are selected through International tender activities? and the relevant contracts are awarded.

2 This question Will there be any According to the proven practice, construction was asked by job opportunity for companies are keen to hire local people with many APs local residents? relevant skills and work experience. EA will recommend that family members of severely affected and vulnerable AHs to be given priority in employment in project-related jobs.

3 Mr. Sandro Is the unit rate for Land unit rate for project affected land parcels is Chakhvashvili land similar for classified according to arable-agricultural and rural every land parcel residential designations. no matter whether The reason is that annual crops, fruit bearing the owner has been perennials and any improvement to the affected taking good case of land parcel are evaluated separately and will be the perennials or cash compensated in addition separately and in has not been addition to land compensation. worried much about All 896 Land parcels (except 3 rural residential) this land? located within the project ROW are homogeneous; They are of similar designation in terms of the land use capacity, productivity, accessibility and location. That is why the Licensed Appraiser followed similar approach and determined one unit rate for arable- agricultural land. However, annual crops, fruit bearing perennials and etc. are evaluated separately, according to the type of crops grown and fruit trees standing on the project affected portion of your land. As repeated at the public meeting, loss of income (affected annual crops, fruit bearing perennials, fences, shelters and etc.) is evaluated at full replacement cost at current market rates, and cash compensation is paid in addition to land compensation.

4 Mrs. Darejan What if our crops If such damage is incurred during the construction Mamulashvili we will grow next period, a landowner is encouraged to take year on the advantage of grievance redress mechanism and remaining portion register the grievance as suggested in the Public of land parcel is Information Pamphlet. damaged during The claim will be revised, on spot examination construction undertaken and relevant compensation issued to process? reimburse the loss incurred by damage caused during the construction process. Amount of compensation will be determined according to principles of compensation entitlements, as provided under the approved RAP

Page 120 || 132 # Name of AP Question raised Answer provided by the Consultant for the proposed project. 5 Mr. Soso What if an owner of As discussed during the presentation, any person Chakhashvili project affected has the right to accept/reject the offer on land person simply does acquisition and compensation for project affected not intend to sell land and assets. his land parcel for any amount of EA will pursue meaningful negotiation with APs to compensation? proceed with land acquisition and compensation procedures. However, the EA will face the need to exercise the right of expropriation based on a Court decision and following issuance of defined compensation in cases where the negotiations fail.

This project qualifies for the status of project for Public Needs and Expropriation will be applied as the last resort.

Certainly, AP is eligible to claim for the higher compensation rates through the Court, but vacating the project affected and expropriated property will be inevitable once the compensation amount is deposited into a special bank account and notwithstanding that the AP may have ignored all the written notifications issued by the Expropriator on the necessity of vacating the expropriated property.

Page 121 || 132 Minutes of Public Disclosure Meeting Resettlement Action Plan for Bakurtsikhe-Tsnori New 16 km Bypass Project

Date: July 3, 2018 Time: 03.00 PM Location: Meeting Hall of Sighnaghi Municipality

Participants: Giorgi Gogilashvili – Mayor of Sighnaghi Municipality Mariam Begiashvili - Social Safeguards and Resettlement Consultant, RDMRDI consultant for WB funded projects David Orjonikidze - RDMRDI Lela Shatirishvili – Senior Social Safeguards and Resettlement Consultant, KOCKS Project affected persons, residents of Anaga, Vakiri, Sakobo and Tsnori: 7 female and 18 male

On July 3, 2018 an official Public Disclosure Meeting was held in Sighnaghi Municipality (Meeting Hall) to engage stakeholders on the Draft RAP of Bakurtsikhe-Tsnori new bypass road construction project supported by WB and GOG and implemented by the Roads Department of Georgia.

The Public Disclosure Meeting was attended by representatives of RDMRDI, of Sighnaghi, Anaga, Vakiri, Sakobo and t. Tsnori Municipalities and project affected persons. Mr. Giorgi Gogilashvili, Mayor of Sighnaghi opened the meeting and raised pertinent issues relating to benefits of the project, including economic benefits, increased safety for road users and local population, reduced delivery time to markets, and increased potential for job opportunities. The opening speech was followed by a Power Point Presentation by Mrs. Shatirishvili. She briefly described major aspects and objectives of the project and the draft RAP prepared in compliance with the active legislation of Georgia, the approved RPF, and WB OP 4.12. Describing the activities undertaken during RAP preparation, she highlighted their importance to developing fair compensation packages for each and every project affected household. She also described and elaborated upon the method of calculation of the compensation unit rates for annual crops, perennials and replacement saplings; she also described the additional one-time allowance allocated for vulnerable households and owners of severely affected land parcels.

Additionally, Mrs. Shatirishvili explained the importance of the cut-off date, December 1, 2017 as defined for this project, and referenced the legislative instruments as adopted in general practice during implementation of land acquisition and resettlement projects.

At the end of the presentation, reference was made to the Grievance Redress Mechanism and GRC as it operated during the entire cycle of the project. Concluding the presentation, Information Booklets carrying compensation unit rates were distributed to every AP, and the panel was opened to the question-answer session. Table B describes the results of Question-Answer Session.

The official Public Meeting was then closed.

Page 122 || 132 Table B. Questions raised by the APs and the answers provided by the Public Meeting Organizers

3 Mr. Akaki What about the This cost is separately calculated and added on top Kemashvili poles and wires we of cash compensation to affected vine plants. would need to start Besides, the replacement cost for sheds, cement vineyard after we vessels you all use for treatment of vine plants, buy another land fences and any improvement is calculated parcel? separately and included in the composition of compensation package.

4 Mr. Giorgi We expect that Land compensation rate is based on current market Khelashvili land prices will prices on similar real property. The independent boost as soon as appraiser took into consideration the sales prices potential sellers will and even listing prices which are in most cases learn that issuance higher than final sales prices. of cash The suggested amount of compensation should compensation allow each of you to purchase another land of started. similar size and production capacity.

5 Mrs. Shalva What if our crops If such damage is incurred during the construction Kemashvili we will grow next period, a landowner is encouraged to take year on the advantage of grievance redress mechanism and remaining portion register the grievance as suggested in the Public of land parcel is Information Pamphlet. damaged during The claim will be revised, on spot examination construction undertaken and relevant compensation issued to process? reimburse the loss incurred by damage caused during the construction process. Amount of compensation will be determined according to principles of compensation entitlements, as provided under the approved RAP for the proposed project.

Page 123 || 132 6 Mr. Nika What if someone As discussed during the presentation, any person Khelashvili decides not to has the right to accept/reject the offer on land agree to sell his/her acquisition and compensation for project affected land not because of land and assets. low price but because he/she is EA will pursue meaningful negotiation with APs to not interested in proceed with land acquisition and compensation selling this land? procedures. However, the EA will face the need to exercise the right of expropriation based on a Court decision and following issuance of defined compensation in cases where the negotiations fail.

This project qualifies for the status of project for Public Needs and Expropriation will be applied as the last resort.

Draft RAP Public Disclosure Meeting Photos July 3, 2018 Gurjaani, Georgia

Presenting brief review of the draft RAP Head of Gurjaani Municipality announcing road project benefits

Page 124 || 132

Distributing PIBs to APs APs scrutinizing compensation unit rates

As anticipated, compensation unit rates Question & Answer session were the leading interest

Draft RAP Public Disclosure Meeting Photos July 3, 2018 Sighnaghi, Georgia

Sighnaghi Mayor delivering opening Presenting draft RAP to APs speech

Page 125 || 132

Attentive Question & Answer session Attentive Question & Answer session

The List of Attendees of Draft RAP Public Disclosure held in Gurjaani on July 3, 2018

Page 126 || 132

The List of Attendees of Draft RAP Public Disclosure held in Sighnaghi on July 3, 2018

Page 127 || 132

Page 128 || 132

Page 129 || 132

Page 130 || 132 Additional Meetings Conducted in 2019 Under the ADB LAR Procedures

During the site visits the ADB Resettlement Consultant conducted individual consultations with the project affected persons (PAPs). These were not extensive consultations required for LARP, but limited communication to verify the importance of the revealed problems, to identify any other missed problem common for many PAPs and to understand concerns of the AHs living along the secondary road, whose opinion has never been assessed before. Consultations covered five PAPs (4 AHs) having vineyards along the main project road and six PAPs living along the proposed secondary road alternatives.

PAPs with affected vineyards along the project road have expressed following concerns:

Name of PAP Raised Issues Conclusions and Phone Number Anzor . Raised the issue of 6m supporting Supporting corridor issue is really Makharashvili corridor required for tractor important for normal operations in 5.98.213712 operations in vineyards; the vineyards . Is interested in construction schedule to plan his agricultural activities for this year . In principle agrees with the need of the project road Tengiz . Raised the issue of 5-6m . Supporting corridor issue is Davitashvili supporting corridor required for really important for normal 5.95.388242 tractor operations in vineyards; operations in the vineyards . Is interested that access roads to . According to information his vineyards are maintained and if received from the LARP it is possible to arrange the consultant, the polls have been watering system connected to the included in inventory of losses irrigation channels not under the category of trees . Claims that he and many of his but under category of ancillary neighbours have not participated in structures (together with the inventory of losses. fences). This issue still needs . Complains that the concrete polls further verification during the used for supporting grape trees finalization of LARP. have not been considered during the inventory of losses Givi Berishvili . Raised the issue of 5-6m . Supporting corridor issue is 5.95.607792 supporting corridor required for really important for normal tractor operations in vineyards; operations in the vineyards . Complains that the price for . The proposed cost for the improved and well managed vineyard land is 3.5 GEL. This vineyard lands is valued the same is definitely higher than 2 GEL as an agricultural land without for not cultivated and not improvements or even abandoned managed lands referred by land plots PAPs. However, the land cost rates could be revisited during the LARP finalization.

Soso Khelashvili . Raised the issue of 6m supporting . Supporting corridor issue is 5.99.400648 corridor required for tractor really important for normal operations in vineyards; operations in the vineyards

Page 131 || 132 Name of PAP Raised Issues Conclusions and Phone Number . Complains that the price for . The proposed cost for the improved and well managed vineyard land is 3.5 GEL. This vineyard lands is valued the same is definitely higher than 2 GEL as an agricultural land without for not cultivated and not improvements or even abandoned managed lands referred by land plots. He claims that he’s PAPs. However, the land cost expenses on land exceed 5 GEL, rates could be revisited during while it has been valuated as 2 the LARP finalization. GEL.

PAPs living along the internal village roads that are proposed for arranging the secondary road connecting v. Vakiri to the Bakurtsikhe-Tsnori project road (alternatives 1 and 2) like the plans and are glad to have new road that will enable good access to mainline roads. Their only concern is that the road design should be optimal to minimize the impacts on assets. The residents living in the houses located on plots No 9 (Darejan Khutsishvili) and 10 (Giorgi Beitrishvili) expressed concerns related to potential vibration impact on their houses, as the houses are located at a distance of 2 -5m from the road. The residents whose houses are located at a distance of 15m from the edge of the planned road (plot No 15 Irma Gelashvili; Plot No 16 Natalia Nanoshvili) did not raise issues of noise or vibration impacts.

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