Transition
impact:
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The following transition impact is expected to be achieved:
1) Framework for markets
Output-based outsourcing of road/street maintenance, i.e. PMMR, will be developed to achieve better value for money. The PMMR approach is centered around the concept of pre-determining road serviceability standards based on performance levels (e.g., smoothness of surfaces, cleanliness of drainage systems, condition and appearance of signage, etc.). These performance standards are then tendered for with private sector contractors who compete during tendering for long-term maintenance contracts using fixed costs per kilometre of maintenance, with full payments made only for full compliance with the pre-established road maintenance service standards (e.g., road smoothness, storm water drain clearance, response times to road surface cracking, etc.).
The PMMR contracting modality will, over time, foster a new private road service industry based on contractors who begin to specialise in the PMMR contracting. The City engineers effectively become public sector’s managers and regulators of road assets, while the private sector executes the public works needed to meet the road users’ needs. This reform would strengthen road management by introducing sound business practices, transfer performance-risk to the private sector, encourage management accountability, whilst also achieving greater budgetary efficiencies, since the PMMR approach typically saves between 15-20% versus unit-cost contracting. A minimum of 15km of city roads will come under joint rehabilitation-PMMR contracting.
2) Transfer of skills
The technical assistance for the development, preparation, training needs and implementation of the PMMR contracting, will lead to a transfer of skills to the City’s staff employed at the Traffic Department responsible for design, execution and management of the road network in the City. Furthermore, specific training modules will be included in the TORs for both the road contractor industry and through active and sustained day-to-day activities working alongside the consultant teams on the PMMR contracting and project management and supervision.
3) Improved road management and planning
The Bank will mobilise TC funds to the City to strengthen its administration by:
(a) solidifying institutionally the Traffic Management Unit to plan traffic circulation and parking, and implement traffic management schemes and manage traffic signals; and
(b) bolstering the existing Traffic Department to plan and manage rehabilitation works to international standards, combined with PMMR-based road maintenance contracts to protect valuable assets.
4) Demonstration effect
By reforming the transport system and its administration in Bulgaria's second largest town, the Project will provide an important demonstration effect to other Bulgarian cities. The Project will demonstrate the benefits of adequate road sector finance, enabling the transport administration to apply more efficient methods for meeting road transport needs. Generally, through the Plovdiv example, other municipalities in the country will be able to see the benefits of reforms to the urban road system, including the introduction of sustainable financing and performance-based contracting for road maintenance as well as efficient traffic management techniques.
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Environmental impact:
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Screened B in accordance with EBRD's 2008 Environmental and Social Policy. The project will provide environmental, health and safety benefits related to the reduction of air emissions, reduction of road accidents and improvements in road and pedestrian safety in the City of Plovdiv. The environmental and social due diligence is on-going and will include a corporate review of the Client’s current environmental and social management systems, the past and current performance against EBRD's Performance Requirements (PRs), and environmental and social analysis of any potential environmental and social impacts and benefits of the priority investments related to priority rehabilitation works of the secondary and local roads in the City of Plovdiv.
An Environmental and Social Action Plan will be prepared and agreed with the Company to address any environmental and social issues identified during the due diligence to achieve and maintain compliance with the Bank's PRs within a reasonable time-frame. The Client will develop a Stakeholder Engagement Plan, including a grievance mechanism, and will release information on environmental and social performance and a summary of the agreed Action Plan to stakeholders. This PSD will be updated when the results of due diligence are known.
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Technical
cooperation:
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Pre-Signing
- Investment prioritisation and technical, environmental and economic due diligence (€35,000).
Post-Signing
- Consultancy assignment to prepare and agree the performance specifications suitable for PMMR type contracts; identify the best method of monitoring and supervision to maximise transition impact; and train a maintenance monitoring unit. Estimated at EUR 225,000.
- Consultancy assignment for Project Implementation Support, to prepare Bills of Quantity and tender documents; assist the city with procurement and contract award; supervise rehabilitation works. Estimated at €300,000.
- Design of a traffic management system, including an integrated traffic control centre, traffic enforcement, real-time information to motorists and accident response. Estimated at €175,000.
For consultant opportunities for projects financed by technical cooperation
funds, visit procurement
of consultants.
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