PLANNING AND LOCAL GOVERNANCE PROJECT IN ALBANIA COMPLETION REPORT JANUARY 2012–SEPTEMBER 2020 August 28, 2020 This publication was produced for review by the United States Agency for International Development. It was prepared by Tetra Tech ARD. PREPARED FOR THE UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT, USAID CONTRACT NUMBER AID-182-C-12-00001, ALBANIA PLANNING AND LOCAL GOVERNANCE PROJECT (PLGP) TETRA TECH ARD CONTACT: SARAH LEDDY SENIOR TECHNICAL ADVISOR/MANAGER [email protected] TETRA TECH ARD HOME OFFICE ADDRESS: TETRA TECH ARD 159 BANK STREET, SUITE 300, BURLINGTON, VT 05401 TEL: 802 495-0282, FAX 802 658-4247 WWW.TETRATECH.COM/INTDEV COVER PAGE PHOTO: Pogradec Girls Scouts (top left); municipal staff at the Fier One Stop Shop (top center); implementation of the Municipality of Elbasan irrigation and drainage action plan to improve service delivery to citizens (top right); Dibra woman harvesting MAP flowers (bottom left); “Doing Business” guides prepared for five partner municipalities with PLGP support (bottom center); and Dibra food producer at the traditional food promotional event organized by PLGP (bottom right). Erald Lamja for USAID. PLANNING AND LOCAL GOVERNANCE PROJECT IN ALBANIA COMPLETION REPORT JANUARY 2012–SEPTEMBER 2020 AUGUST 2020 DISCLAIMER This report is made possible by the support of the American People through the United States Agency for International Development (USAID). The contents of this report are the sole responsibility of Tetra Tech and do not necessarily reflect the views of USAID or the United States Government. CONTENTS ACRONYMS AND ABBREVIATIONS ii EXECUTIVE SUMMARY v 1.0 INTRODUCTION 1 1.1 PURPOSE OF THE COMPLETION REPORT 1 1.2 STRUCTURE OF THE COMPLETION REPORT 3 2.0 CONTEXT 4 2.1 THE DECENTRALIZATION AGENDA IN 2012 4 2.2 SIGNIFICANT PROGRESS DESPITE HURDLES: LOCAL GOVERNANCE IN 2020 5 3.0 ACHIEVEMENTS BY COMPONENT 8 3.1 HIGHLIGHTS AND ACHIEVEMENTS 8 3.1.1 COMPONENT 1 (HISTORIC): SUPPORT THE GOA’S WORK TO IMPLEMENT EFFECTIVE GOVERNMENT DECENTRALIZATION POLICIES AND LEGISLATION 8 3.1.2 COMPONENT 1: SUPPORT GREATER PREDICTABILITY, TRANSPARENCY, AND REVENUE POTENTIAL OF LOCAL GOVERNMENT FINANCES 10 3.1.3 COMPONENT 2: IMPROVE MUNICIPAL MANAGEMENT SYSTEMS FOR DELIVERY OF KEY LOCAL SERVICES 12 3.1.4 COMPONENT 3 (HISTORIC): IMPROVE LOCAL GOVERNMENT MANAGEMENT AND OVERSIGHT OF PUBLICLY OWNED UTILITIES, IN ACCORDANCE WITH EUROPEAN UNION STANDARDS 20 3.1.5 COMPONENTS 3A AND B: STRENGTHEN CIVIC ENGAGEMENT TO PREVENT/COUNTER VIOLENT EXTREMISM (AND WOMEN, PEACE, AND SECURITY) 23 3.1.6 COMPONENT 4 (HISTORIC): STRENGTHEN THE CAPABILITIES OF THE GOVERNMENT OF ALBANIA AND LOCAL GOVERNMENTS TO PLAN AND MANAGE URBAN AND REGIONAL GROWTH 41 3.1.7 COMPONENT 4: PROMOTE ECONOMIC DEVELOPMENT PLANNING AND IMPLEMENTATION 44 4.0 DISCUSSION OF PROBLEMS ENCOUNTERED AND WHERE OBJECTIVES WERE NOT ACHIEVED 47 5.0 LESSONS LEARNED 50 6.0 RECOMMENDATIONS AND NEXT STEPS IN LOCAL GOVERNANCE 62 6.1 SUGGESTIONS FOR FUTURE PROGRAMS AND SUPPORT FOR DECENTRALIZATION 62 6.2 SUSTAINABILITY MEASURES AND FUTURE ACTIVITIES WITH STAKEHOLDERS 67 7.0 ANNEXES 72 7.1 INDEX OF ALL REPORTS AND INFORMATION PRODUCTS PRODUCED UNDER THIS CONTRACT 72 7.2 SUCCESS STORIES 91 7.3 PERFORMANCE INDICATOR REPORT/PMP, TABLE BY YEAR. 92 PLANNING AND LOCAL GOVERNANCE PROJECT IN ALBANIA: COMPLETION REPORT (2012–2020) i ACRONYMS AND ABBREVIATIONS ALL Albanian Lek ASLG Agency for Support of Local Self-Government BAWIS Billing and Accounting Water Information System BLAST Boys Leadership and Advocacy BtF Bashkia te Forta CAP Citizens Advisory Panel CBS Community-Based Scorecard CC Consultative Council CEMR Council of European Municipalities and Regions COD Community and Organizational Development CSO Civil Society Organization CVE Countering Violent Extremism DCM Decision of Council of Ministers DO Development Objective DP Democratic Party EDAC Economic Development Advisory Council ESD Empowerment through Self-Defense Program EU European Union FAIS Finance Administration Information System FILD Financial Instrument for Land Development G2G Government-to-Government GDP Gross Domestic Product GEO Gender Equality Officer GIS Geographic Information System GIZ Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH GLOW Girls Leading Our World Club GLTP General Local Territorial Plan GoA Government of Albania GSVCA Gender-Sensitive Value Chain Analysis ICT Information and Communications Technology KPI Key Performance Indicator LDP Local Detailed Plan LED Local Economic Development LGAP Local Gender Action Plan LGFL Local Government Finance Law PLANNING AND LOCAL GOVERNANCE PROJECT IN ALBANIA: COMPLETION REPORT (2012–2020) ii LGU Local Government Unit LPSC Local Public Security Council LSGL Law on Local Self-Government MAP Medicinal and Aromatic Plants MoFE Ministry of Finance and Economy MoI Ministry of Interior MoIE Ministry of Infrastructure and Energy MoSLI Minister of State for Local Issues MoUD Ministry of Urban Development NALAS Network of Associations of Local Authorities of South-East Europe NCDLGS National Crosscutting Decentralization and Local Governance Strategy NGO Nongovernmental Organization NRW Non-Revenue Water NTC National Territorial Council NTPA National Territorial Planning Agency OSR Own-Source Revenue OSS One-Stop Shop P/CVE Preventing/Countering Violent Extremism PCV Peace Corps Volunteer PEFA Public Expenditure and Financial Accountability PFM Public Finance Management PIT Personal Income Tax PLGP Planning and Local Governance Project PMP Performance Monitoring Plan PPP Public-Private Partnership PVE Preventing Violent Extremism QSIP Quality Service Improvement Program RDF Regional Development Fund SECO Swiss Secretariat for Economic Affairs SP Socialist Party STAR Support for Territorial Administrative Reform Project STTA Short-Term Technical Assistance TAIS Local Tax Administration Information System TAP Trans-Adriatic Pipeline TAR Territorial Administrative Reform ToT Training of Trainers UNDP United Nations Development Program PLANNING AND LOCAL GOVERNANCE PROJECT IN ALBANIA: COMPLETION REPORT (2012–2020) iii UNFPA United Nations Population Fund USAID United States Agency for International Development USG United States Government VE Violent Extremism Web-GIS Web-Based Geographic Information System WEE Women’s Economic Empowerment WPS Women, Peace, and Security WSBP Women’s Small Business Program WU Water Utility YAP Youth Academy Program PLANNING AND LOCAL GOVERNANCE PROJECT IN ALBANIA: COMPLETION REPORT (2012–2020) iv EXECUTIVE SUMMARY The last nine years have been pivotal for local governments in Albania, with unprecedented opportunities to advance decentralization and strengthen local governance. The Government of Albania (GoA), despite a challenging political environment and competition over resources, succeeded in implementing decentralization legislation, policies, and reforms with the United States Agency for International Development (USAID) Planning and Local Governance Project (PLGP) as the lead technical assistance provider. The key building blocks constructed at the national level enhance the enabling environment for democratic decentralized local governance, and PLGP accompanied municipalities at the local level in applying those policies, amassing evidence to improve them, and building capacity of local officials to fulfil their promise of proximate, inclusive, and responsive services. PLGP evolved over its nine years from four components focused generally on technical issues of policy, utility management and service delivery, local government institution strengthening, and urban planning. As the policy framework became more complete, these first components refocused on more specific technical issues, such as fiscal decentralization. In the last years of the project, USAID turned its attention to more nuanced issues of local governance, like fostering community resilience and enabling economic empowerment. These emerged with the awareness that the marginalization in Albania of vulnerable people—women and ethnic and religious minorities—was exacerbating the phenomenon of violent extremism and foreign fighting, as well as continuing the exclusion of women from remunerated roles in the productive economy. Context. When PLGP was launched in January of 2012, Albania was facing unprecedented opportunities to advance decentralization and strengthen a system of local governance that met European standards and practices for entry into the European Union (EU). Despite openings, challenges to decentralization arose: Polarization of political parties inhibited thoughtful discussion and consideration of public policies affecting local government and decentralization. Territorial reform linked to decentralization initiatives would result in a significant reduction in the number of local government units (LGUs), creating a controversial loss of political power for many local-level officials and a corresponding diminishment of opportunities for patronage. Local governance in 2020 is significantly improved due to the advancement of the decentralization agenda. Municipalities have the experience of their first mandate post-territorial reform to better understand their new functions, engage their citizens in planning those functions, and use more revenues to provide services through more transparent, equitable transfers and new borrowing possibilities. The U.S. Ambassador Arvizu giving remarks during the PLGP launching ceremony on May National Crosscutting Strategy 18, 2012. for Decentralization and Local Governance,