COLOMBIA MINISTRY OF ENVIRONMENT, HOUSING AND TERRITORIAL DEVELOPMENT WATER AND SANITATION DEPARTMENTAL MODERNIZATION PROGRAM (DEPARTMENTAL PLANS)

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1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized COLOMBIA MINISTRY OF ENVIRONMENT, HOUSING AND TERRITORIAL DEVELOPMENT WATER AND SANITATION DEPARTMENTAL MODERNIZATION PROGRAM (DEPARTMENTAL PLANS) RESETTLEMENT POLICY FRAMEWORK [August 14, 2007] RP581

2 PROJECT DESCRIPTION Colombia, with a population of about 42 million inhabitants, has made impressive progress in expansion of water and sanitation services in urban areas in recent years. According to United Nations guidelines which include private wells in the case of water supply and septic tanks and latrines in the case of sanitation access to safe water and sanitation services has become virtually universal, especially in large urban areas of Colombia during the last decade. Using stricter definitions of household connections to water and sewerage, the current level of access in urban areas would be 97% for water and 90% for sewerage, which still compares impressively with higher income countries like Argentina (70%) and the rest of the region. Rural coverage (broadly defined) is much lower (53% for water and 57% for sanitation), with these levels shrinking to 52% and 15% respectively when the definition is restricted to household water and sewerage connections. The Government s New Strategy: The Departmental Plan Approach. Colombia is remarkable among Latin American countries in that it has maintained a consistency of policies for the last decade. Recent developments include (a) a clearly articulated strategy to improve coverage and services in rural and urban areas and to achieve the ambitious goal of universal service coverage for potable water; (b) a further commitment to the policy approach imitated under earlier Governments and supported by Bank loans related to utility modernization, the incorporation of commercially independent competent operators under long-term concession agreements; (c) the scaling up of the use of transparent and well-designed capital investment subsidies linked to performance improvement; and, a particularly important innovation to (d) leverage departmental resources to simultaneously increase investment, provide incentives for regionalization and modernization, and improve the use of public resources, many of which have been ineffectively used by local governments. This policy approach is laid out in clear detail in the already-approved document of the Consejo Nacional de Política Económica y Social (CONPES) number Specifically, the CONPES document includes and is based upon five key tenets: (i) a major investment program with clear and transparent subsidies; (ii) a deepened and broadened approach to improving utility performance.; (iii) the use of implementation arrangements developed under the La Guajira Project; (iv) the clear and transparent use of subnational resources in a fiscally responsible manner; and, (v) the mainstreaming of the clear and transparent rules of the game for investment developed under 7281-CO. Objectives of the Bank s Project. The objective of the proposed project (APL Phase I) is to improve the quality of water supply and sanitation services in urban, peri-urban, and rural areas of the five participating departments, moving towards complete coverage with continuous supply of potable water for urban areas and significant improvement in the coverage and quality of service in rural areas for water supply. Specifically, the proposed operation will increase service coverage for water supply, sanitation, and wastewater treatment in urban areas by (a) consolidating a model for improved utility management under the Government-supported specialized operator model; and (b) delivering the necessary water and sanitation infrastructure. The project will be structured around the establishment of operator-based management arrangements in participating municipalities in large part through multimunicipal concessions. Project s Components. The Project would consist of one loan agreement per department. All departments will engage in Components 1 and 3 (Urban Water Supply and Sanitation Services Improvement; and Concession Structuring, Monitoring and Evaluation, and Project Management, respectively). Component 2, Rural Water Supply and Sanitation Services, will apply to select departments. In Phase I of the APL, only Tolima will engage in Component 2. Component 1. Urban Water Supply and Sanitation Services Improvement 2

3 The core element of the operation would be the consolidation of the urban and peri-urban areas under a series of contracts with specialized operators and the provision of the required injection of departmental resources for expanding basic infrastructure and improving service management. The basic model for contracting of specialized operators would be the negative concession / least-subsidy approach, which has been well established in Colombia and is currently supported under three Bankfinanced Projects. The operation would, in principle, work in all 40 municipalities of Norte de Santander, the 25 municipalities of Sucre, and the 476 municipalities of Tolima. In cases where specialized operators are already in place, the operation would support, if necessary, the restructuring of the concession agreement to advance investment and meet outcomes in a shorter period of time than initially estimated at the time of the concession establishment. In municipalities where no specialized operator exists, mayors who choose to enter the program would be supported by the department-level management unit in the structuring of a medium-term concession arrangement using the already-in-place model contract, tariff models, and supervision and oversight mechanisms used in the La Guajira operation, 7077-CO, and 7281-CO. During the Appraisal mission, the specific municipalities which are expected to participate in the initial stage of Phase I would be identified and finalized. The component would allow management-driven investment decision making by local private operators based on clearly established performance criteria to (a) improve the quality of drinking water; (b) improve the coverage of water supply and sanitation services; and (c) improve the continuity of service, with a medium-term goal of achieving continuous water supply service for the significant majority of the Department s urban residents. Investments financed would be typical for the sector and would include water sourcing works and basic treatment infrastructure, primary and secondary water supply networks including household connections and meters for water supply, primary and secondary sewerage networks, and basic wastewater treatment infrastructure. Component funds would also be used to finance management tools including commercial systems, cadastres, etc. Component 2. Rural Water Supply and Sanitation Services In a number of the departments which are expected to participate in the program, and typical for Colombia, the performance of rural and small-town water supply and sanitation services is particularly weak. The operation would thus include a specific component dedicated to the financing of low-cost, appropriate solutions to bring potable water supply and basic sanitation to rural areas in select departments. For Phase I, Tolima would be the only participating department. During the initial stages of the structuring of each departmental plan, a department-wide rural water and sanitation strategy will be developed. The approach would include the rollout of the existing national programs for rural water supply and sanitation which include (a) the constructor- operator model, in which capable construction firms are contracted to build and operate simple water supply and sanitation systems; (b) the microempresas comunitarias approach, which involves the development of community-based micro-systems for providing basic services; and (c) for hinterland areas of concessioned municipalities, basic management arrangements with urban operators to provide training and basic operation and maintenance expertise on a pay-for-service basis. Rural interventions would be designed as integrated approaches for rural water supply, sanitation, and basic health and would include hand washing and other basic sanitary management efforts. The rural interventions would be based in large part on the Government s Política Pública de Abastecimiento de Agua y Saneamiento Básico para la Zona Rural de Colombia, published as an official policy document in September Component 3. Concession Structuring, Monitoring and Evaluation, and Project Management 3

4 The operation would include a component for the establishment of project management capacity at the departmental level particularly in regard to (a) structuring and/or renegotiating existing concessions; (b) project monitoring, supervision, and evaluation; and (c) ensuring implementation of the safeguard policies. The Government program is based on the use of independent program management services, and in principle the operation would support this approach, though some departments may have the in-house capacity to manage implementation. Impacts of the project. The operation will have very positive impacts on the environmental and social conditions of the poorest people, usually settled in intermediate and minor municipalities and, particularly, in the rural areas of the same. In the first stage, the program will benefit [xxx] people living in the departments of Tolima, Norte de Santander, Bolívar, Córdoba and Sucre (i) by reducing morbidity and mortality related to water quality, decontamination of water sources through appropriate management and, in some cases, wastewater treatment; and (ii) by increasing the efficient use of water, particularly in the case of works related to network renovation, with the subsequent reduction of resources for treatment and increased administrative and operating efficiency of service providers. Immediate effects will be observed in people s health, particularly children, who are frequently more vulnerable to gastrointestinal diseases, cholera, typhoid fever, hepatitis B, among others. The construction of the works will require, in some cases, the purchase of lands and the involuntary displacement of the people living in said areas, as well as of the relevant business and social activities. Both international and domestic experience has proven that if the impact caused by involuntary displacement is not mitigated, serious economic and social problems may arise for the affected people. With the purpose of mitigating the impacts of the involuntary displacement caused by the Program, a Resettlement Policy Framework has been developed to support the restoration of the socioeconomic conditions of the people to be relocated. This Framework is consistent with the World Bank s Policy on Involuntary Resettlement, 4.12, the organization that will participate in the project s financing. Bearing in mind that the land acquisition process cannot be separated from the displacement and resettlement processes, it shall be included in this Policy Framework. RESETTLEMENT FRAMEWORK This document sets out (i) the principles and objectives of the resettlement policy, to be applied by the subproject implementers, (ii) the legal framework for the acquisition of land and the resettlement of people, (iii) the procedure to prepare the resettlement plans, (iv) eligibility criteria for the population of beneficiaries, (v) follow-up, monitoring and evaluation arrangements, and (vi) institutional organization and sources of financing. Definitions. The following concepts are defined as used in this Policy Framework. INVOLUNTARY DISPLACEMENT: It occurs when a person, family, group or business is forced to move to another location as a result of a decision legally imposed upon them by an external agent, without any possibility of continuing in the place where they reside. In this Project, people living in the lands required for the construction and improvement of the infrastructure works, as well as the economic activities developed in that area, shall be displaced. 4

5 RESETTLEMENT It is the process whereby displaced people are supported to restore the standards of living they enjoyed prior to the displacement, ensuring the sustainability of the process in the medium and long-term. DISPLACED POPULATION The groups, communities or population living or working in the areas required by the works, who are forced to move away from the area. SOCIAL UNIT It means people with an interest in an estate, whether they reside in it or not, people who live in such estate and industrial, business and service facilities developing their economic activities in a plot. Social Units may be classified according to possession (owners, tenants, beneficiary holders, holders, occupants), use (dwelling, industries, stores, services) and residence (whether that person is living in the property or not.) More than one social unit may use the same estate. ESTATE Individual land unit with or without betterments, which may be identified as a physical unit and in the cadastre. DEGREE OF AFFECTATION Total: when the total estate is affected and all social units living or conducting any business in such estate have to relocate. Partial: when the estate is partially affected and the residual land may still be used as a dwelling or for an economic activity. Partial affectation may imply displacement of one or more social units living or carrying out an economic activity in that estate. Objectives and Principles governing the Preparation and Execution of the Resettlement Objectives To mitigate and compensate any impacts caused by the involuntary displacement, when such displacement is unavoidable. To restore the socioeconomic conditions of the displaced population. Principles To minimize population displacement All negative impacts of involuntary displacement must be prevented to the extent possible. To that effect, each subproject shall analyze in detail all the viable project options to suggest the option resulting in the smallest displacement. Restoration of Socioeconomic Conditions Payments do not, by themselves, solve displacement problems and do not ensure the restoration of the socioeconomic conditions of affected people. For that purpose, resettlement plans shall be developed and implemented to assist displaced persons in restoring or improving their livelihoods. Inclusion All people located in the area where the subprojects will be built, regardless of the type of holding they demonstrate, shall be entitled to receive assistance to restore their standards of living. 5

6 Equity Resettlement solutions to be proposed by entities shall be responsible to the impacts caused by the displacement. Equality Any family or business to be displaced shall be treated on an equal footing and shall have access, on an equity basis, to the various programs to be implemented. Communication Owners and residents of the required estates shall receive clear, true and timely information about their rights, duties and the status of their relevant processes. Consultation Social units to be displaced shall be consulted on resettlement alternatives and on any plan to be developed in that regards Transparency The whole of the land acquisition and resettlement process shall be disclosed and validated in a manner that all participants are aware of it. The process shall be managed in an objective and technical fashion to guarantee that the benefits only cover the population affected by the works and the defined criteria and procedures are equitably applied to all persons involved. Timeliness The Entities responsible for executing the actions and activities related to resettlement shall allocate the necessary physical, human, administrative and financial resources to execute the resettlement within the scheduled timeframe. Comprehensiveness The planning and execution of the resettlement process shall take into account the various aspects and implications for the target population, as well as for the territories where population will be resettled and from which it is displaced. Sustainability The resettlement process includes, as an integral part of it, mechanisms to secure the restoration of socioeconomic conditions in the short, medium and long term. LEGAL FRAMEWORK The Resettlement Policy Framework is developed under the applicable international regulations ratified by the Government of Colombia, national rules, and general principles of law, case law and doctrine that provide guidelines on the acquisition of land and protection of the fundamental rights of people displaced as a result of development projects, as well as the method of appraisal of the affected property. Rules related to Land Acquisition Constitutional Rules Article 1. Colombia is a Social State of Law organized as a unitarian and decentralized Republic, with autonomous territorial entities, democratic, participatory and pluralistic, founded on the respect for human dignity, work and the solidarity of its people, and on the prevalence of the general interest. 6

7 When section 1 of the Political Constitution says that Colombia is a Social State of Law, it is asserting that the State has the obligation of seeking social justice in each of its actions, so the rights of citizens are not violated as a consequence of the administration s actions. It is consistent with Article 2 of the Constitution, which states that the State s essential purposes are: to serve the community, promote the general prosperity and ensure the effectiveness of the principles, rights and duties enshrined in the constitution. C Article 58. Private property and all other rights vested under civil laws are guaranteed Property has a social function that involves duties. And as such, the ecological function is inherent to it Expropriation may occur on the basis of public usefulness or social interest as determined by lawmakers, provided there is a court judgment and prior compensation The Constitution guarantees private property as a general rule and allows for expropriation as an exception, only on for reasons of public usefulness and social interest, after paying a compensation for the damage caused, which amount shall be calculated by consulting the interests of the community and of the affected person and invoking reasons of justice and equity. In such proceedings, not only the basic constitutional guaranties related to right to life, integrity and right to defense shall be taken into consideration, but also the need to act, on behalf of the State, providing effective responses and enabling the development of the rights to benefits, inter alia the right to decent housing is one of the most important rights (C ). Legal Rules Law 388 of 1997 The acquisition of land for reasons of public utility is ruled by the special procedure regulated under chapter III, Law 9, of 1989, amended by chapter VII, Law 388, of 1997, by virtue of which the right in rem to ownership, its constituent elements and all other rights in rem may be purchased. For the purposes of expropriation and all other reasons described in other effective laws, public usefulness or social interest shall be declared in order to purchase real property and use it for the following purposes: execution of production, extension, supply and distribution projects for residential utilities; execution of infrastructure programs and projects; creation of reserve areas for the protection of the environment and water resources; execution of urban development and construction projects, with the priorities established by the relevant plans, in accordance with the provisions of the law. The law provides a basic procedure to execute the purchase of an estate, when it is voluntarily sold by its owner. In this case, the existence of a purchase offer shall be specially mentioned. The purchase offer is notified as provided for in sections 44 and 45 of the Administrative Litigation Code and there is no administrative recourse. (Law 388, section 61). This act shall be evidenced in the certificate of delivered and unencumbered estate to exclude the estate from trade. The law gives the Government a minimum 30-day period to reach a formal agreement for the voluntary sale, evidenced in a purchase commitment agreement ; otherwise, the Administration shall be free to initiate expropriation proceedings. The purchase commitment is executed in agreement with the provisions of the Civil Code and the Rules for Notaries and Registry. 7

8 Finally, it is important to point out that current regulations have a gap in the process of estate acquisition regarding the possession of the real estate, because Law 388, of 1997, does not provide for any mechanism to acquire the possession and purchase the betterments, subjects are only covered in high-risk cases. Special arrangements have been established in the resettlement plans to take care of possessors and holders of betterments. In some cases, as in the Capital District, Decree 619/2000 and Decree 296/2003 establish that as a minimum the value of betterments made by occupant shall be paid and, if their value is lower than fifty (50) minimum wages, an additional amount shall be paid so that the occupant may purchase decent housing. Regulation for the Resettlement of Persons While Colombia does not have any regulated procedure to formulate and implement resettlement plans, as it is the case with the purchase of estate, there are international and constitutional rules to be used as a basis. Consequently, each of the Program s subprojects to be carried out in the country that is financed by the World Bank will use such regulations as a basis, as well as this Resettlement Policy Framework. International Rules The criteria adopted to take international rules into consideration within this Framework are based on the precedence of international law and human rights over domestic rules and their direct application to our regulations (section 93 of the Code of Procedure) The Convention of San José de Costa Rica (included through Law 16, of 1972) establishes that: Section 21. Any person is entitled to use and enjoy his or her property. Law cannot subordinate such use and enjoyment to social interest. No person shall be deprived of their property, except after payment of a fair compensation, based on reasons of public usefulness or social interest and in the cases and under the conditions established by law. Universal Declaration of Human Rights (United Nations) Every human being shall have the right to be protected against being arbitrarily displaced from his or her home or place of habitual residence (United Nations. Principle 6). The international prohibition of arbitrary displacement includes displacement in cases of large-scale development projects, which are not justified by compelling and overriding public interests (United Nations. Principle 6). Prior to any decision requiring the displacement of persons, the authorities concerned shall ensure that all feasible alternatives are explored in order to avoid displacement altogether. Where no alternatives exist, all measures shall be taken to minimize displacement and its adverse effects (United Nations. Principle 7). The authorities undertaking such displacement shall ensure, to the greatest practicable extent, that proper accommodation is provided to the displaced persons, that such displacements are effected in satisfactory conditions of safety, nutrition, health and hygiene, and that members of the same family are not separated (United Nations. Principle 7). The free and informed consent of those to be displaced shall be sought (United Nations. Principle 7) The authorities concerned shall endeavor to involve those affected, particularly women, in the planning and management of their relocation (United Nations. Principle 7). 8

9 Displacement shall not be carried out in a manner that violates the rights to life, dignity, liberty and security of those affected (United Nations. Principle 8). Adequate measures shall be taken to guarantee to those to be displaced full information on the reasons and procedures for their displacement and, where applicable, on compensation and relocation (United Nations. Principle 7). Constitutional Rules Article 1. Colombia is a Social State of Law organized as a unitarian and decentralized Republic, with autonomous territorial entities, democratic, participatory and pluralistic, founded on the respect for human dignity, work and the solidarity of its people, and on the prevalence of the general interest. The bases of this new definition of the State have been developed by Constitutional Case Law and indicate, first and foremost, respect and guarantee for constitutional rights, particularly, the development and effectiveness of economic, social, cultural and collective rights and, secondly, the democratic participation in government and the special attention the State should devote to solving the needs of its citizens, pursuing their well-being and quality of life. Article 2 The authorities of the Republic are constituted to protect all Colombian residents, in terms of their lives, dignity, property, beliefs and all other rights and freedoms and to ensure fulfillment of the social duties of the State and individuals. Article 5 The State recognizes, without discrimination, the preeminence of the inalienable individual rights and safeguards the family as the basic institution of society. Article 90. The State shall economically respond for illegal damages attributable to it, resulting from the action or omission of government authorities Article 287 Territorial entities enjoy autonomy to manage their interests, and within the limits established by the Constitution and the Law Articles 42, 43, 44, 46, 51, 58, 79, 80 stipulate social, economic and cultural rights. The right to housing shall be recognized under conditions of dignity, i.e., under material and spiritual conditions that will help live with quality and have a space for the free development of the personality (decision C-575/92. Article 51, National Constitution) Legal Rules Law 388, of 1997 Section 1, par. 3. Ensure that the use of the soil by its owners fulfills the social function of property and helps to enforce the constitutional rights to housing and residential utilities, and foster the creation and defense of the public sphere, as well as the protection of the environment and disaster prevention. Section 2 Land use planning is based on the following principles: The social and ecological function of property. The prevalence of the general interest over the individual interest. The fair distribution of burdens and benefits. 9

10 Section 4 Democratic participation. In the exercise of the various activities that make up urban action, municipal, district and metropolitan administrations shall encourage the harmonization of social, economic and urban interests by promoting the participation of the population and their organizations Section 3 Endeavor to improve the population s quality of life and to achieve an equitable distribution of development opportunities and benefits. Section 119 points out that in case of owners or holders of social housing who do not accept the payment terms or preferential rights established by this section, the municipal or district administration participating in the relevant renovation projects shall guarantee access to a housing solution of the same type, for which purposes, it shall grant municipal housing subsidies. Law 99, of 1993, Section 57. Environmental Impact Assessment. An Environmental Impact Assessment consists of the set of information to be submitted to the competent environmental authority when an Environmental Permit is requested. The Environmental Impact Assessment shall include information on the project site and the abiotic, biotic and socioeconomic elements in the environment that may be impaired as a result of the work or activity at issue Law 56, of 1981 This law covers public works for power generation, water supply and irrigation systems, and regulates the expropriation and rights of way for the property affected by such works. Title II lists all cases and procedures to acquire rights of way related to the projects being regulated. This law was regulated mostly with a view to energy-related works, but it is used as basis for right of way processes related to residential utilities. Law 142, of 1993 It defines the residential utilities regime and includes some other provisions. Chapter 3 of Title IV describes the framework for expropriation and rights of way related to residential utilities. Section 57 grants public utilities the power to impose rights of way, temporary occupy land and remove obstacles, and lay the necessary lines, cables or pipes overhead, underground or on surface of third-party estates; temporarily occupy the necessary areas in those plots; remove crops and obstacles of any kind in those plots; cross, execute the works and guard them; and, in general, perform any activity necessary to provide the service. It establishes that the owner of the affected estate shall be entitled to compensation under the provisions of Law 56, of 1981, for the inconveniencies and damages derived from such use. It also establishes that the construction of water supply and sewerage facilities may cross rivers, streams, railroads, bridges, streets, roads, as well as aqueducts, oil pipelines and other lines or pipes, after the relevant government agency authorizes the interested company and, if there is no law providing who shall authorize such construction, is shall be authorized by the municipality where the obstacle to be removed is located. Law 99, of 1993 It creates the Ministry of the Environment, currently named Ministry of Environment, Housing and Territorial Development (in Spanish, MAVDT), restructures the Public Sector responsible for managing and preserving the environment and the renewable natural resources, organizes the National 10

11 Environmental System (in Spanish, SINA) and includes some other provisions, including the power of the MAVDT and other environmental authorities to expropriate and impose the rights of way necessary for the execution of public works aimed at protecting and managing the environment and the renewable natural resources. Method to Appraise Affected Estates According to the provisions of above-mentioned Law 9, of 1989, and Law 338, of 1997, and regulatory Decree 1420, of 1998, that expressly regulates the appraisals of plots affected by public usefulness (as in the case of road infrastructure projects and IGAC Resolution 762/1998), the method to appraise the plots required to execute the subprojects shall be the method regulated by Section 1 of the above-mentioned resolution, called comparative or market method. It consists of an appraisal technique that tries to calculate the commercial value of the property by analyzing other tenders or recent transactions involving other properties that are similar and comparable with the property being appraised. These tenders or transactions shall be classified, analyzed and interpreted to calculate the commercial value. Additionally, section 21, paragraph 6 of Decree 1420 establishes that in the case of estates used for productive activities, when the affectation causes the temporary or definitive limitation of income from such development, a compensation for loss of income (for a maximum period of six (6) months), shall be calculated in addition to the estate appraisal. Therefore, each subproject shall take this section into consideration when calculating compensations other than the estate value, related to productive or income-producing activities carried out at the plots being purchased. With respect to the value to be received by owners in consideration for their plots, case law has pointed out that: Compensation is therefore a consequence of the State s power to expropriate. It results from the duty to repair the damage derived from the exercise of that power: damage caused by a legitimate activity from administrative action. The activity is legitimate, because expropriation only takes place for reasons of public usefulness or social interest defined by lawmakers. Thus, the general interest to deliver the State s essential purposes prevails. It is described in the above-mentioned section 2: to promote general prosperity and ensure the effectiveness of the principles, rights and duties granted by the Constitution. Compensation is not compensatory, i.e., it is not a presumption or condition of the compensation that results in the State s obligation to pay in favor of the expropriated owner, because of the enrichment of the former. If that were the case, the compensation would be based on the objective value of the property and not, as the Constitution says, consulting the interests of the community and of the affected person. If the thesis that compensation has a compensatory nature is accepted, expropriation would only amount to a simple conversion of values: expropriated assets are replaced for their equivalent amount of money and, therefore, it would not cover any damage directly or indirectly caused by expropriation. In that case, compensation would not be fair, as mandated by section 21, paragraph 2 of the San José de Costa Rica Convention. It is clear that the compensation mentioned in article 58 of the Constitution aims at repairing and must be complete, because it covers general damage and loss of income to the owner who has been expropriated. And, if loss of income cannot be proven, compensation may be based on the value of the estate and the interest accrued from the date such estate is delivered up to the date when the compensation is paid (C ). Additionally, it should be remembered that section 57 of Law 99, of 1993, establishes, in line with section 1, that The Environmental Impact Assessment shall include information on the project site and the abiotic, biotic and socioeconomic elements in the environment that may be impaired as a result of the work or activity for which the permit is requested, and an evaluation of any likely impact. It will also include draft plans to prevent, mitigate, correct and compensate impacts and the environmental 11

12 management plan for the work or activity. (Emphasis added). So, compensation is a legal transaction, provided it is part of a study ordered by law or a mechanism used to repair impacts caused by a project, work or activity. PREPARING THE RESETTLEMENT PLAN Composition of the work team To prepare a resettlement plan, the agency in charge of the subproject will appoint a team of qualified professionals to coordinate its design and execution, within the unit responsible for preparing the project. Information to the community Before starting the activities related to designing the works of the subproject, an Information and Communication Program shall be designed, including the various stages of the Resettlement Plan and adjusted to the scope of the impact. This Program will address two different groups: the population of the area of influence who will continue residing at the site and the owners and residents of the lands that will be required for the work. Objectives Inform the population of the area of influence of the project regarding its potential characteristics, the technical stages involved in project design and construction, anticipated the time schedules, the various parties involved and the agency responsible for the project. Report on the studies and procedures that will be carried out regarding the owners, holders of rights and residents of the lands that will possibly be acquired. Reduce the stress and anxiety of the population potentially affected by the works. Show the project-linked benefits and the manner in which all stakeholders will benefit from the project. Prevent the interference of external agents with economic or political interests that impinge on public interests and the interest of the affected population. Introduce the persons responsible for social management and resettlement to the community. Establish effective and fast communication channels to respond in an ongoing manner to community concerns. To that end, a mutually agreed place and opening hours to the community should be defined. Such a site should be located within the area affected and be readily accessible, to avoid transportation costs for the population. Coordination of the resettlement process with the project's technical stages In order to guarantee the availability of the lands at the time of starting the construction of the works and to allow for the time needed to execute the Resettlement Plan, all subprojects to be carried out will maintain a close relationship among the technical work stages, the provisions of the Land use Plan and the development and execution of the Resettlement Plan, as indicated below: Once final designs are ready, technical, legal and socio-economic diagnoses of the affected lands and the population to be displaced shall be made. Based on such diagnoses, impacts will be identified; solution alternatives will be defined and the Resettlement Plan will be formulated. The execution of the Resettlement Plan will be carried out during the process of procurement of the works, so that the lands are available when works start. If the construction schedule allows for it, the execution of the plan may continue during this stage, provided always that it does not affect the construction schedule or result in a hasty or provisional move of the population. 12

13 The stages to be covered to design and execute the Resettlement Plan are described below. A social expert in each department will indicate the level of detail required by each subproject. Census and socio-economic survey of the affected families, properties and businesses Identify the socio-economic characteristics of the area of intervention of the project and potential conflict situations. Identify the need to acquire plots of land for the construction of the works and estimate their number. Identify the need to displace population, identify the socio-economic characteristics of such population and assess the social and economic feasibility of resettlement. Identify potential social conflicts. Make a preliminary calculation of the human, physical and financial resources required to execute the resettlement plan. Include the estimated resettlement costs in the subproject budget. Topographical Survey. Determine the physical characteristics of the plots and improvements to be acquired for project execution. Titling Review. As the topographical survey proceeds, the documents required to review titles will be gathered (i.e. deeds, purchase commitments, payment receipts of property taxes, utilities and other documents required by the lawyers.) A certificate of reception of such documents will be drawn, indicating the type of document delivered and the date. Estate Appraisal. After analyzing the consistency between the information from the topographic surveys and the titling review, the appraisals shall be procured. Socio-economic Diagnosis. It implies developing a detailed census of the social units present in the area affected by the works, aimed at gathering updated and detailed information on the demographic, economic and social characteristics of the owners and residents of the lands required by the project. Impact Identification. This is the stage for identifying and analyzing the impacts that the owners and residents of the lands required by the project will face, so as to define the corresponding mitigation and compensation measures. Diagnosis of the Area for the New Settlement. In the case of resettlement to new houses, conditions shall be evaluated in order to define the area where the population will be resettled, including the provisions of the corresponding land zoning plans of the relevant municipalities regarding the use of land, recreation areas, risk conditions, among others, to ensure the feasibility of the settlement under appropriate conditions and to prevent future conflicts When a compensation alternative is chosen, the replacement property shall comply with the POT urban rules and provisions. The Borrower will collect the information required to complete the following charts: 13

14 Table 1: Number of plots affected total or partially Affectation degree Total 1 Partial 2 No. of plots 1 Total affectation: when the whole of the plot is affected and as a result, it is not possible to continue carrying out activities. 2 Partial affectation: the area affected by the project is a small fraction of the affected property and the residual land is economically viable. 14

15 Table 2: Property (affected goods and assets) Plot 1 Household Number 2 Business Number 3 Plot area Description of the dwellings and constructions Holding (owner, holder, tenant, etc) Assessed value Comments 1 Assign a number to each affected plot. Likewise, for each plot indicate the Household No. or Business No., respectively. 2 Households are defined as the individual or group of people who occupy the whole or part of a dwelling and have associated to satisfy their food needs and share a budget. In this column, assign a number to each affected household. That number will be the household identification number in the following tables. If there is more than one affected household or business per plot, list each household or business taking into account that the plot number should remain the same in the following tables. 3 Business is defined as any economic activity. To complete the following tables, use the id number of each household or business as previously identified. 15

16 Table 3: Socio-economic characteristics of the families HH No. Name of Head of HH Number of people in the HH No. of children under 13 No. of adults over 60 No. of students Source of income Work or study site and distances Means of transport to workplace or study site Uses of the property (housing, economic activity, other) Comments 16

17 Table 4: Socio-economic Characteristics of businesses Business Number Name of business owner Age of Business owner Type of Activity No. of employees Average monthly income Destination production of Place of Sale Years in Business in Affected Area Comments 17

18 Table 5: Impacts Caused by the Displacement (households) HH No. Loss of land Loss of house Income loss or reduction Loss difficulty access education centers or of to Loss of access to health care services Loss of access to public services Loss of social networks Degree of affectation, total or partial Comments 18

19 Table 6: Impacts Caused by the Displacement (Business) Business No. Loss land of Loss of Business Income loss or reduction Possibility relocating business of the Degree of affectation, total or partial Comments 19

20 Impacts caused by the displacement. Provide the level of detail required to understand the extent of the impact caused by the relocation. The property holding and use are impact determining factors, hence impacts are analyzed based on these variables and the population is classified according to the impacts they will face. This classification will make it easier to determine the target population groups for each mitigation or compensation measure. As a guideline, below there is a description of the type of impacts that may be caused by the displacement, as well as the population groups that face them. TABLE 7 TYPE OF IMPACTS Variables determining the impact Temporary affectation of right of way. Partial affectation of the property. Total Affectation of the property. Impact Temporary loss of the use of land Partial loss of the property Total loss of the property Categories Owners, holders Owners or holders with partial affectation. Owners, holders Residing in the property. Loss of dwelling Owners, holders, lease-holders, beneficiary users, resident holders Economic activity in the affected property or in the affected area, or property derived income. Productive activity Partial or total loss of income. Partial or total loss of income.. Landlord, owners of stores, industries or services. Owners or workers. Community participation. Access to services Loss of community organizations and disruption of social fabric Loss or decrease of access to services such as Education, Employment, Recreation, Health care, due to disruptions to the normal mobility conditions Population participating in local social organizations. Owners, holders and in general the population living in the zone to be resettled. Proposed assistance for resettled families. Description of the type of assistance that will be provided to the displaced, the terms of the agreements with them and their willingness to accept the agreed assistance and programming. The resettlement alternatives are defined based on the results of the diagnoses, the identification of impacts and the supply of new or used real property that could be used to replace the affected property. 20

21 The agency responsible for the resettlement shall decide on the type of solution that will be adopted for the relocation of the social units, taking into account the resources, timeframe, needs of the population, local housing plans and housing market offering. In general, it will be necessary to: Describe the efforts to restore or improve income; Provide special attention to the aged, the disabled, single mothers, or people requiring special assistance; Describe how access to basic services will be restored or improved; Indicate how families and community groups will be kept together; Describe the arrangements to restore socioeconomic links; Describe the possible impacts on the host groups and the measures taken to prevent rejection or other negative reactions. Broadly there are three alternatives for resettlement: - Compensation - Resettlement in new housing, including its environs, as well as restoration of household income - Assistance for relocation. Compensation. It consists in the purchase of a new or used property, by the owner or holder, with the sum of money received as payment for the value of appraisal at market prices, the payment of compensation for the economic losses caused by the move and real estate, legal and social advise to acquire a replacement property and restore the socio-economic conditions, such as access to education, health care, employment and distance to workplace, access to recreation, etc. To implement it, it is essential to guarantee that the property offering is sufficient to replace the lost assets. For the case of lease-holders, this alternative provides advice to obtain another property to rent, guaranteeing the time and the resources for the relocation. Resettlement in a new dwelling. It consists in the collective move to a resettlement solution offering housing, restoration of economic activities, basic service infrastructure and social facilities. It implies the purchase and development of lands, the construction of infrastructure, housing, community facilities, the award of housing, titling, transfer and socio-economic restoration programs after the move. Collective resettlement plans are generally proposed when the following situation arises: (i) the diagnosis identifies a high degree of vulnerability of the population to the displacement, due to the group s cohesion and roots in the place, (ii) there are available lands for construction, (iii) the availability of time for the construction of the public work makes it possible. Table 8: Agreed Solutions HH or Business No. Resettlement Solution Comments Eligibility Criteria. The eligibility criteria to become a beneficiary of the resettlement plan and of the various solution alternatives included in the same will be the following: Duly credited holder of the rights on the property to be purchased. Resident or carrying out an economic activity in plots required for the construction of the works. Being registered in the official census carried out in the socioeconomic study. 21

22 The cutoff date of the list of beneficiaries of the resettlement program can be determined by means of the declaration of public usefulness or by the public announcement of the project execution in the official gazette or in the municipal registry. Both the declaration and the announcement should contain the list of the heads of the eligible social units with their corresponding identification number. To prevent future modifications, at the information meetings it will be agreed to have the lists available to be reviewed by the population of beneficiaries at the community centers and 15 days will be allowed to introduce any adjustments required as a result of census errors or omissions. Resettlement Planning and Design Once the mode of resettlement of the population has been defined, the respective plan will be developed, dependent on the type of alternatives selected, defining the human, physical, and financial resources and preparing an implementation schedule, which should be coordinated with the works contracting and construction schedule. It is also necessary to define the institutional organization required to implement the plan, execute agreements with other institutions, as may be required, and consult and validate the contents and scope of the Plan with the owners and resident population of the required plots. Information and Consultation Program. This program is intended to offer the owners, holders of rights, residents and businessmen of the plots required for the works adequate, timely and ongoing information on the contents of the Resettlement Plan, the process to purchase the plots, the planned schedules and the rights and obligations of each of the parties. To that end, the information and consultation program should be present in the stages of resettlement preparation and implementation. The dissemination strategies for each subproject will depend both on the project s particularities and on the characteristics of the population. To develop this program it is necessary to: Carry out community meetings at the start of each stage in the process (preliminary studies, diagnose, consultation and validation of the plan). Record the participation of individuals in the various events (attendance records) and record the opinions and conclusions (minutes of meetings). Design a system to receive and follow up on claims and grievances that could arise during the process. EXecution of the resettlement plan Execution The actions contemplated for planning and design will be implemented during this stage. Also, a Committee will be set up with the participation of the unit responsible for the construction of the works, the person responsible for the implementation of the Environmental Management Plan, and those in charge of implementing the resettlement. This Committee will meet periodically to assess progress, identify problems and agree on solutions. The implementation of the Plan can be carried out directly by the entity that is responsible for the project; it can be contracted with a private firm or carried out through agreements with other institutions. The set up of the respective team, the contracting or execution of agreements should take place with sufficient anticipation to guarantee the beginning of the plan s implementation as soon as its formulation is completed and the work construction is confirmed. It is recommended that, insofar as possible, the purchase and resettlement team be the same during the Diagnosis and Plan implementation phases. 22