E-424 Public Disclosure Authorized RUSSIAN FEDERATION MUNICIPAL WATER AND WASTEWATER PROJECT ENVIRONMENTAL ASSESMENT OF THE PROJECT Public Disclosure Authorized (EA) Public Disclosure Authorized 9 December, 2000 Public Disclosure Authorized 1 Contents 1. Project Objectives .............................................. 2 2. Project Description.............................................. 2 3. Project Environmental Sunumary.............................................. 3 4. Environmental Management and Monitoring Plans (EMMPs) .............................................. 5 5. Environmental Assesment by Project Cities .............................................. 5 5. 1 Astrakhan.............................................. 5 5. 2 Cheboksary ............................................. 7 5.3 Gagarin ............................................. 10 5 Kansk.4 ............................................. 11 5.5 Nakhodka............................................. 14 5.6 Oryol............................................. 16 5.7 Pechora ............................................. 17 5.8 Petrozavodsk ............................................. 19 5.9 Pskov ............................................. 21 5.10 Sochi............................................. 24 5.11 Tobolsk ............................................. 26 5.12 Volkhov ............................................. 27 5.13 Vologda ............................................. 29 5.14 Votkinsk............................................. 32 1. Project Objectives The objective of the project is to arrest the decline of water and wastewater services of fourteen medium-size cities (less than 500,000 inhabitants) located in different regions of Russia that have demonstrated their commitment to the project objectives and the institutional reforms necessary to achieve them. More specifically, at the city level, the project seeks to: (a) support the most critical and immediate investments needed to improve the operation of the water and wastewater systems while achieving improvement of system operations, reduction of operational costs, improvement of service quality; and (b) implement a specific set of institutional and commercial reforms aimed at improving physical system operations and financial performance of vodokanals. Through project implementation, the Russian Federation will extract lessons from the implementation of the fourteen sub-projects over a wide range of local conditions and the project will support the preparation of replicable methodologies, guidelines, and case studies to guide the government's program of municipal services reform aimed at helping municipal local governments and their water and wastewater enterprises (vodokanals) to become better managed, more efficiently operated and financially sustainable utilities that are capable of providing water and wastewater services of a higher quality to their customers in a cost- effective manner. 2. Project Description The Municipal Water and Wastewater Project (MWWP) is composed of three major components: (1) Immediate Investment Program; (2) Management Strengthening and Operational Improvement Program; and (3) Project Management and Implementation Support. Proiect CoomponentI - Immediate Investment Program (1P): In each city, a set of high priority immediate investments have been identified, justified, costed and designed by consultants during project preparation. The HP for the vodokanals has an implementation period generally of no more than two years; and a total cost below the sub- project loan size to allow sufficient resources for the implementation of the Management Strengthening and Operational Improvement Program. Proiect Component 2 - Management Strengthening and Operational Improvement Program (MSOIP): The objective of this component is to implement a specific and well-defined set of technical and commercial reforms aimed at improving physical system operations and management and financial performance of Vodokanals. The MSOIP is divided into two closely related sub components 2.1 - Technical Assistance for Implementation of the MSOIP (TA): This sub-component will finance the consulting services to support: (i) the development and implementation of a new govemance and commercial system, accounting and financial management system, tariffs setting system and metering strategy; and (ii) the identification of investments to improve the quality and efficiency of-water and wastewater services. Finland, Sweden and United Kingdom are expected to participate in the financing of this component. 2.2 - Investment in Support of the MSOIP: This sub-component will finance investments (goods, works and training) in order to: (i) improve the management of vodokanals; and (ii) improve the operational efficiency of the existing systems through implementation of the interventions defined under sub-component 2.1. The investments in this category would include various items generally used with water and wastewater systems like pipes, valves, pumps, mechanical and electrical parts, and controls, bulk and block meters, maintenance equipment, leak and pressure management equipment, and other equipment. Proiect Component 3 - Proiect Management and Implementation Support: 3.1 - Engineering Designs and Bidding Documents: Consultants will assist each of the participating vodokanals in the elaboration of final designs and bidding documents of all investments in the MSOIP. Finland and Sweden are expected to participate in the financing of this component. 3.2 - Supervision of Construction: Consultants will assist vodokanals in the supervision of construction to ensure that the quality of equipment and civil works under both the IIP and the MSOIP meet adequate standards of quality and that bills provided by suppliers and contractors are correct. 3.3 - General Procurement Assistance: Qualified advisors will assist the National Foundation for Housing Reform (NFHR) and vodokanals in procurement actions to ensure compliance with the provisions of the Loan Agreement and the Bank's Guidelines. The advisors will also be responsible for training the staff in the NFHR and in various vodokanals in handling procurement. Sweden will finance this component. 3.4 - Project Implementation Arrangements: The NFHR will be responsible for managing and supervising the project. The NFHR will be the main link with the Bank and fully responsible for ensuring that the project is implemented efficiently in accordance with the provisions of the Loan Agreement. 3. Project Environmental Summary The project has been classified as Category B, which requires a limited environmental review to identify potential negative environmental impacts and propose mitigation and monitoring measures where needed. A review of potential environmental impacts from the proposed investments has been carried out during the project preparation process for each of the participating cities by the Vodokanals with the assistance of foreign consultants. This is being complemented by sub- project specific Environmental Management Plans (EMMPs) that will be reviewed and approved by Russian authorities and the Bank prior to any construction activities being undertaken in the concerned municipality. The project is not anticipated to have significant negative environmental effects and will not result in any involuntary resettlement or land acquisition since it focuses on rehabilitation of existing network and facilities. All work will be executed either within the premises of existing facilities or within the right of way of public streets.. The project will not finance construction of new facilities for water production, water treatment, or wastewater treatment. Investments financed by the project will not affect any known archeological or historical site or any critical natural habitats, -nor will it entail resettlement or affect indigenous peoples. None of the structures to be rehabilitated include dams. Nevertheless, the project may cause some environmental impacts that require mitigation measures related to: (i) inappropriate disposal of excavated materials, construction debris, and small quantities of hazardous wastes and materials related to construction activities; (ii) damage caused by contractors during construction activities; and (iii) nuisance during construction (noise, dust, and traffic disruption). The contract documents include provisions for mitigation measures and/or avoidance. Participating vodokanals, under the guidance of Gosstroi and the Bank, are preparing public meetings to discuss project objectives and construction activities and their likely impacts on the environment and public at large. OP 7.50, "Intemational Waterways" applies to twelve sub-project, which are located on intemational waterways as defined by paragraphs (a) or (b) of the policy. These include the cities of Astrakhan, Cheboksary, Gagarin, Oryol, Petrozavodsk, Pskov, Sochi, Tobolsk, Volkhov, Vologda, and Votkinsk. These sub-project involve rehabilitation of existing schemes and/or construction, which in the team's judgment (i) will not adversely change the quality or quantity of water flows to the other riparians; and (ii) will not be adversely affected by the other riparians' water use. Given the nature of the planned interventions to be supported by the sub-project and the fact that they will not adversely impact downstream riparian countries, the exception to the external notification requirements of OP 7.50, as set forth in paragraph 7(a) of the policy has been determined by