Document of The World Bank Report No: ICR00004429 IMPLEMENTATION COMPLETION AND RESULTS REPORT Public Disclosure Authorized (IBRD-85540) ON A LOAN IN THE AMOUNT OF US$150 MILLION TO THE THE MUNICIPALITY OF MANAUS WITH A GUARANTEE OF THE FEDERATIVE REPUBLIC OF BRAZIL Public Disclosure Authorized FOR A SERVICE DELIVERY AND FISCAL MANAGEMENT DEVELOPMENT POLICY LOAN July 27, 2018 Public Disclosure Authorized Governance Global Practice Latin America and the Caribbean Region Public Disclosure Authorized The World Bank BR Manaus Service Delivery and Fiscal Management DPL (P153203) CURRENCY EQUIVALENTS (Exchange Rate Effective as of April 20th, 2015) And (Exchange Rate Effective as of July 11th, 2018) Currency Unit = Brazilian Real (R$) R$3.86 = US$1 (April 2015) R$3.81 = US$1 (July 2018) FISCAL YEAR January 1 – December 31 ABBREVIATIONS AND ACRONYMS BRT Bus Rapid Transit CPF Country Partnership Framework DPL Development Policy Loan DPO Development Policy Operation FIRJAN Rio de Janeiro’s Industry Federation (Federação das Indústrias do Estado do Rio de Janeiro) GDP Gross Domestic Product GIDE Integrated School Management Model (Gestão Integrada da Escola) ICMS Brazilian Value Added Tax (Imposto sobre a Circulação de Mercadorias e Serviços) IDEB Basic Education Development Index (Índice de Desenvolvimento da Educação Básica) IFGF FIRJAN Fiscal Management Index (Indice FIRJAN gestão fiscal) IPTU Municipal Property Tax (Imposto Predial e Territorial Urbano) ISS Service Taxes (Imposto Sobre Serviços) IT Information Technology MEC Ministry of Education (Ministério de Educação) MEI Individual Micro Entrepreneurs (Micro Emprendedor Individual) MM Municipality of Manaus NCR Net Current Revenues PDCA Plan, Do, Check, and Act PDO Program Development Objective PPA Manaus' Multi-Year Plan (Plano Plurianual) Database of School Directors (Programa Municipal de Certificação e PROCERT Composição de Banco de Diretores para Unidades de Ensino da Rede Pública Municipal de Manaus) SEMED Municipal Secretariat of Education (Secretaria Municipal de Educação e Cultura) SEMEF Municipal Secretariat of Finance (Secretaria Municipal de Finanças) UGC Central Procurement Administration Unit (Unidade Gestora de Compras Municipais) ZFM Manaus Free Trade Zone (Zona Franca de Manaus) The World Bank BR Manaus Service Delivery and Fiscal Management DPL (P153203) Regional Vice President: Jorge Familiar Country Director: Martin Raiser Senior Global Practice Director: Deborah Wetzel Practice Manager: Robert Taliercio Task Team Leader: Laura Zoratto ICR Main Contributor: Daniel Ortega Nieto The World Bank BR Manaus Service Delivery and Fiscal Management DPL (P153203) BR Manaus Service Delivery and Fiscal Management DPL TABLE OF CONTENTS DATA SHEET A. BASIC INFORMATION ........................................................................................................................................ ii B. KEY DATES ......................................................................................................................................................... ii C. RATINGS SUMMARY ......................................................................................................................................... ii D. SECTOR AND THEME CODES ............................................................................................................................ iii E. BANK STAFF ...................................................................................................................................................... iv F. RESULTS FRAMEWORK ANALYSIS .................................................................................................................... iv G. RATINGS OF PROJECT PERFORMANCE IN ISRs ............................................................................................... vii H. RESTRUCTURING (IF ANY) .............................................................................................................................. viii ICR SUMMARY ...................................................................................................................................................... 9 1. PROJECT CONTEXT, DEVELOPMENT OBJECTIVES AND DESIGN .................................................................. 10 2. KEY FACTORS AFFECTING IMPLEMENTATION AND OUTCOMES ................................................................ 15 3. ASSESSMENT OF OUTCOMES ..................................................................................................................... 19 4. ASSESSMENT OF RISK TO DEVELOPMENT OUTCOME ................................................................................ 29 5. ASSESSMENT OF BANK AND BORROWER PERFORMANCE ......................................................................... 29 6. LESSONS LEARNED ...................................................................................................................................... 30 7. COMMENTS ON ISSUES RAISED BY BORROWER/IMPLEMENTING AGENCIES/PARTNERS ......................... 32 ANNEX I: BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION PROCESSES .................................. 34 ANNEX II: RESULTS BY PILLAR ............................................................................................................................. 35 ANNEX III: SUMMARY OF BORROWER'S ICR AND/OR COMMENTS ON DRAFT ICR ............................................ 40 ANNEX IV: MANAUS CASE STUDY ON GLOBAL REPORT ON IMPROVING PUBLIC SECTOR PERFORMANCE ....... 41 ANNEX V: LIST OF SUPPORTING DOCUMENTS ................................................................................................... 47 ANNEX VI: MAP ................................................................................................................................................... 48 The World Bank BR Manaus Service Delivery and Fiscal Management DPL (P153203) A. BASIC INFORMATION BR Manaus Service Country: Brazil Program Name: Delivery and Fiscal Management DPL Program ID: P153203 L/C/TF Number(s): IBRD-85540 ICR Date: 06/04/2018 ICR Type: Core ICR Development Policy PREFEITURA DE Financing Instrument: Borrower: Loan MANAUS Original Total US$150.00 million Disbursed Amount: US$150.00 million Commitment: Revised Amount: US$150.00 million Implementing Agencies: Cofinanciers and Other External Partners: B. KEY DATES Revised / Actual Process Date Process Original Date Date(s) 07/31/2017 Concept Review: 12/11/2014 Effectiveness: 06/27/2016 Appraisal: 03/23/2015 Restructuring(s): Approval: 12/03/2015 Midterm Review: 07/31/2017 Closing: 07/31/2017 C. RATINGS SUMMARY C.1 Performance Rating by ICR Outcomes: Satisfactory Risk to Development Outcome: Low Bank Performance: Satisfactory Borrower Performance: Satisfactory C.2 Detailed Ratings of World Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Quality at Entry: Satisfactory Government: Satisfactory Implementing Quality of Supervision: Satisfactory Satisfactory Agency/Agencies: Overall Bank Overall Borrower Satisfactory Satisfactory Performance: Performance: ii The World Bank BR Manaus Service Delivery and Fiscal Management DPL (P153203) C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments (if Indicators Rating Performance any) Potential Problem Program at any time No Quality at Entry (QEA): None (Yes/No): Problem Program at Quality of Supervision No None any time (Yes/No): (QSA): DO rating before Closing/Inactive status: D. SECTOR AND THEME CODES Original Actual Sector Code (as % of total Bank financing) Public Administration Sub-National Government 60 60 Education Primary Education 30 30 Transportation Urban Transport 10 10 Theme Code (as % of total Bank financing) Economic Policy 5 5 Fiscal Policy 5 5 Tax policy 5 5 Human Development and Gender 30 30 Education 30 30 Access to Education 15 15 Education Financing 15 15 Public Sector Management 45 45 Public Administration 20 20 Transparency, Accountability and Good 20 20 Governance Public Finance Management 25 25 Domestic Revenue Administration 5 5 iii The World Bank BR Manaus Service Delivery and Fiscal Management DPL (P153203) Public Expenditure Management 20 20 Urban and Rural Development 20 20 Urban Development 20 20 Urban Planning 20 20 E. BANK STAFF Positions At ICR At Approval Jorge Familiar Calderon Vice President: Jorge Familiar Calderon Martin Raiser Country Director: Martin Raiser Arturo Herrera Practice Manager/Manager: Robert R. Taliercio Gutierrez Laura De Castro Zoratto Program Team Leader: Laura De Castro Zoratto ICR Team Leader: Daniel Ortega Nieto ICR Primary Author: Daniel Ortega Nieto Fabio Sola Bittar F. RESULTS FRAMEWORK ANALYSIS Program Development Objectives (from Project Appraisal Document) Assist the Municipality of Manaus (MM) in improving the management of its finances as well as its education and transport sectors, through upgraded revenue and expenditure processes, meritocratic and results-oriented management of schools, and improved control of bus concessions Revised Program Development Objectives (if any, as approved by original approving authority) (a) PDO Indicator(s) Actual Value Original Target Values Formally Achieved at Indicator Baseline Value (from approval Revised Completion or documents) Target Values Target Years Indicator 1: Number of registered properties in the Property Tax Cadaster Value 214,914 560,000 365,586 Quantitative or Qualitative) Date achieved 01/01/2013 07/31/2017 07/31/2017 iv The World Bank BR Manaus Service Delivery and Fiscal Management