FINAL REPORT VOLUME 7: SUBPROJECT APPRAISAL REPORT: CITY OF KORONADAL WATER DISTRICT Asian Development Bank LOCAL WATER UTILITIES ADMINISTRATION WATER DISTRICT DEVELOPMENT SECTOR PROJECT Project Preparatory Technical Assistance (PPTA) TA No: 7122 - PHI PÖYRY IDP CONSULT, INC., PHILIPPINES in association with TEST Consultants Inc., Philippines PÖYRY Environment GmbH, Germany APRIL 2010 PÖYRY IDP CONSULT, INC. This report consists of 12 volumes: Volume 1 Main Report Volume 2 Institutional and Financial Assessment of LWUA Volume 3 Subproject Appraisal Report: Metro La Union Water District Volume 4 Subproject Appraisal Report: Quezon Metro Water District Volume 5 Subproject Appraisal Report: Legazpi City Water District Volume 6 Subproject Appraisal Report: Leyte Metro Water District Volume 7 Subproject Appraisal Report: City of Koronadal Water District Volume 8 Report and Recommendation of the President (RRP) Volume 9 Supplementary Appendices A to G (Technical Aspects) A Review and Assessment of Water Supply and Sanitation Sector Outside Metro Manila B Water Sector Laws and Policies C Assessment of Existing Water Supply Systems in Pilot Water Districts D Proposed Water Supply Component for Pilot Water Districts E Non Revenue Water Contract Mechanisms F Sanitation G Health Volume 10 Supplementary Appendices H to J (Social Aspects) H Socio-economic Survey I Stakeholder Consultation and Participation J Indigenous Peoples Volume 11 Supplementary Appendices K to S (Financial, Implementation Aspects) K Financial Management Assessment L Detailed Project Cost and Financing Plans for Water Districts M Financial Analysis N Financial History of Water Districts O Economic Analysis P Institutional Strengthening and Capacity Building Q Indicators for Measuring Development Objectives and Performance R Terms of Reference for Consultants (Project Implementation Support Services) S Profiles of Priority Water Districts from Long-list Volume 12 Supplementary Appendices T to V (Safeguard Aspects) T Initial Environmental Examinations U Resettlement Framework V Resettlement Plans TA No. 7122-PHI: Water District Development Sector Project PPTA – FR Vol. 7 – SPAR: CKWD i SUBPROJECT APPRAISAL REPORT: CITY OF KORONADAL WATER DISTRICT List of Contents Glossary and Acronyms vi Location Map xi 1 Executive Summary ................................................................................................. 1 1.1 Introduction ......................................................................................................... 1 1.2 Conclusions of Socio-economic Survey and Stakeholder Consultations.............. 1 1.3 Water Supply....................................................................................................... 2 1.3.1 Rationale ...................................................................................................... 2 1.3.2 Existing Water Supply System ..................................................................... 2 1.3.3 Scope of Proposed Water Supply Component ............................................. 3 1.3.4 Implementation Schedule ............................................................................. 4 1.4 Water District Capability and Subproject Implementation .................................... 6 1.5 Subproject Cost, Financing Plan and Financial Analysis ..................................... 6 1.6 Economic Analysis .............................................................................................. 9 1.6.1 Economic Internal Rate of Return and Sensitivity Analysis ........................... 9 1.6.2 Subproject Beneficiaries ............................................................................... 9 1.6.3 Subproject Sustainability .............................................................................. 9 1.6.4 Poverty Impact ............................................................................................. 9 2 Description of Study Area ..................................................................................... 11 2.1 Location ............................................................................................................ 11 2.2 Physical Features .............................................................................................. 11 2.2.1 Topography ................................................................................................ 11 2.2.2 Vegetation .................................................................................................. 11 2.2.3 Climate ....................................................................................................... 13 2.2.4 Land Area .................................................................................................. 13 2.2.5 Land Use .................................................................................................... 13 2.2.6 Soil Type .................................................................................................... 14 2.3 Population ......................................................................................................... 14 2.3.1 Demography .............................................................................................. 14 2.3.2 Health ........................................................................................................ 15 2.3.3 Education ................................................................................................... 17 2.4 Economy ........................................................................................................... 18 2.4.1 City Income and Expenditures .................................................................... 18 2.4.2 Agriculture .................................................................................................. 18 2.4.3 Commerce and Trade ................................................................................ 18 2.4.4 Tourism ...................................................................................................... 18 2.5 Social services .................................................................................................. 19 2.5.1 Water Supply ............................................................................................. 19 2.5.2 Health Facilities .......................................................................................... 19 2.5.3 Sanitation Facilities .................................................................................... 19 2.5.4 Transportation and Communication ............................................................ 20 2.5.5 Power Supply ............................................................................................. 20 3 Socio-economic Survey and Stakeholder Consultations ................................... 22 3.1 Socio-economic Survey ..................................................................................... 22 3.1.1 Profile of Households in Subproject Site .................................................... 22 3.1.2 Income and Expenditure Profile ................................................................. 23 3.1.3 Existing Water Service ............................................................................... 23 TA No. 7122-PHI: Water District Development Sector Project PPTA – FR Vol. 7 – SPAR: CKWD ii 3.1.4 Sanitation, Health and Hygiene .................................................................. 24 3.1.5 Willingness to Connect/Willingness to Pay ................................................. 25 3.1.6 Risks and Vulnerabilities ............................................................................ 26 3.1.7 Social Services and Networks .................................................................... 27 3.1.8 Gender Roles, Issues and Concerns .......................................................... 27 3.2 Stakeholder Consultations and Focus Group Discussions................................. 28 3.3 Poverty Analysis, Social Benefits and Recommendations ................................. 30 3.3.1 Poverty Analysis ......................................................................................... 30 3.3.2 Needs and Demand ................................................................................... 30 3.3.3 Gender Analysis ......................................................................................... 31 3.3.4 Social and Environmental Equity ................................................................ 31 3.3.5 Indigenous People, Ethnic Minorities and other Vulnerable Groups in the Subproject Area ................................................................... 31 3.3.6 Social Benefits ........................................................................................... 32 3.3.7 Recommendations ..................................................................................... 32 4 The Water District and its Existing Facilities ....................................................... 34 4.1 Historical Background ....................................................................................... 34 4.2 Organization and Management ......................................................................... 34 4.3 Water Supply Infrastructure and Service ........................................................... 36 4.3.1 Source Facilities ......................................................................................... 36 4.3.2 Treatment Facilities ...................................................................................