Pre-Feasibility Study Guidelines · 2020. 12. 15. · area shown in Figure 1—the Pre-Feasibility...

Cities Development Initiative for Asia

Pre-Feasibility Study Guidelines

February 2015

CDIA

Pre-Feasibility Study Guidelines i

TABLE OF CONTENTS

1 INTRODUCTION ..................................................................................................................... 1

2 GUIDING PRINCIPLES AND LEVEL OF DETAIL OF THE PRE-FEASIBILITY STUDY ........................... 2

3 STRUCTURE AND SCOPE OF THE PRE-FEASIBILITY STUDY ........................................................ 4

4 MANAGING THE PRE-FEASIBILITY STUDY PROCESS ................................................................. 9

4.1 Key Milestones in the Assignment ............................................................................................... 9

4.2 Preparing for the Post Pre-Feasibility Study Phase .................................................................... 11

4.3 Counterpart Consultation .......................................................................................................... 12

4.4 Data Collection and Management ............................................................................................. 12

4.5 Capacity Development ............................................................................................................... 12

4.6 Monitoring and Evaluation Framework ..................................................................................... 13

4.7 Quality Standards ....................................................................................................................... 13

APPENDIX 1: INITIAL DEVELOPMENT IMPACT ASSESSMENT (IDIA) ............................................... 14

APPENDIX 2: SAMPLE DESIGN AND MONITORING FRAMEWORK ................................................. 24

APPENDIX 3: QUALITY STANDARDS ............................................................................................ 25

APPENDIX 4: PRE-FEASIBILITY, FEASIBILITY AND PPTA STUDIES ................................................... 27

Pre-Feasibility Study Guidelines 1

1 INTRODUCTION

The Cities Development Initiative for Asia (CDIA) an international partnership initiative, established in 2007 by the Asian Development Bank (ADB) and the Government of Germany, with additional funding support from the governments of Austria, Sweden, Switzerland and the Shanghai Municipal Government.1 The Initiative provides assistance to medium-sized cities2 to bridge the gap between their development plans and the implementation of their infrastructure investment investments.

Figure 1: Cities Development Initiative for Asia – Activity Focus

These guidelines set out the objectives, processes, and techniques required for the second focus area shown in Figure 1—the Pre-Feasibility Study (PFS).

The overarching objective of a PFS is to determine the merit of a particular investment opportunity. Specifically, the PFS will determine whether the proposed investment provides sufficient value to warrant the use of scarce resources (e.g. money, skills, time) and therefore whether it is worth proceeding to the next stage in the development process and conducting a full feasibility study.

In terms of content, the PFS will contain a review of sector investment options and priorities, initial scoping and costing of the identified investment project, measures for addressing social, and environmental (e.g. climate change) concerns and designing the governance and financing structures for implementation. The outputs from the PFS provide a technical, financial, environmental, and social assessment of a project at a level of detail sufficient to write the terms of reference for a full feasibility study (FS).3

The PFS development process requires a tripartite partnership between the city government, PFS consultants, and the CDIA core management team (CMT), working together to identify, conceive, and structure prioritized urban development projects needed to improve living conditions in a city.

These Guidelines are principally designed to assist PFS consulting teams to deliver quality outputs within the specified time and budget to achieve the objectives outlined above. However, they can also assist city governments in understanding and contributing to the PFS process.4

1 Austria joined the program in 2010 and Shanghai’s involvement ended in March 2015. 2 Defined as having a population of between 250,000 and 5,000,000. 3 CDIA Operational Guidelines. See Appendix 4 for a summary of the principal differences between PFS, FS and PPTA reports. 4 City governments undertaking a PFS are advised to review a report available on CDIA’s website entitled”CDIA Pre Feasibility Study User Manual: For Cities and National Partner Organisations” to better understand the objectives and outputs of a PFS from their standpoint.


2 GUIDING PRINCIPLES AND LEVEL OF DETAIL OF THE PRE-FEASIBILITY STUDY

Ideally, a PFS should be preceded by a process of prioritizing alternative infrastructure investment projects leading to a clearly defined Investment Program.5 The PFS process normally includes an assessment of one or two priority projects within an investment program framework.

However, where such a framework is not in place and the city master plan and sector plans are insufficiently detailed, it may be necessary to rework investment priorities, including sector reviews, in the early stages of the PFS. The PFS report may therefore include a section on infrastructure investment programming, detailing the outputs of this process and one or more sections assessing priority projects. These guidelines, however, focus on the development of PFSs for selected projects only.

The PFS conceptualizes and structures an investment project at conceptual engineering design, a lower level of engineering design typically expected in a feasibility study being conducted for ADB and World Bank (preliminary engineering design). The accuracy margin to final costs in conceptual engineering design will generally be about 20%. Similarly, in the PFS, the level of policy, social, environmental, and institutional analysis is less detailed than at the feasibility study level. Financial and economic analyses in the PFS will contain internal rates of return, but again the expected accuracy margins will be higher (approximately plus or minus 20%, as compared to an FS where a margin of 10% is expected based on preliminary engineering design).

The length of the PFS will, of course, vary from project to project depending on the number of sectors covered and the complexity of the proposed investment(s). However, the project team should aim to make the report as concise as possible while simultaneously ensuring that the needs of the client city and future financier(s)/investor(s) are fully met, and the tasks set out in the Terms of Reference (ToR) fully completed.

Guiding Principles

As an underlying objective of CDIA’s work is sustainable urban development, CDIA PFS interventions must address at least two of the following guiding principles:

1. Urban environmental sustainability Projects must aim at improving environmental and health conditions through careful selection and design of infrastructure projects and investments. This means safeguarding the urban environment in a traditional way, and introducing and prioritizing environmental projects and environmental components within a project. For instance, a transport project initially dealing with road improvement and public transport may include components on renewable fuel, traffic management, and other elements that improve the urban environment.

2. Mitigation of and adaptation to the effects of climate change All projects must include an assessment of climate change effects mitigation potential and/or adaptation needs, and describe investments needed to address these issues. This may also have bearing on the financial analysis in terms of potential for accessing carbon credits and partial financing capital investment with such credits.

3. Urban poverty reduction and gender equality Infrastructure investments should enhance the access of disadvantaged groups to basic services and contribute to their economic development. PFS teams should work with counterparts in government to identify the poor, their needs, and the types of investments needed to pull them

5 CDIA has an Excel based tool called “City Infrastructure Investment Prioritization and Programming” (CIIPP) that can be employed to help define such priorities.


out of poverty. Equally, the PFS team should take into account the different needs, opportunities, and conditions of men and women so that better preparation, implementation, and operation of infrastructure systems can be achieved. Gender mainstreaming in the PFS process involves both analysis and action to ensure that development policy making, planning, and implementation are sensitive to the needs of women as well as men, and promote greater equality of opportunity and benefit.

4. Good urban governance The project preparation process should be as inclusive, transparent, and accountable as possible and involve multiple forms of civic engagement as well as working closely with stakeholders to identify the city’s investment needs. This process is critical to efficient and equitable functioning of cities in Asia. When participation, civic engagement, and bottom-up planning do not come naturally to public sector organizations, and the ability of cities to prepare sustainable urban development solutions is compromised, what emerges is ad hoc development skewed in favor of the few. The urban poor are often marginalized with resulting social tensions.

The PFS should not limit itself to flagging possible adverse impacts from an infrastructure investment, but actively deal with all crosscutting subjects in an integrated, holistic, and cross-sector infrastructure development approach.

The PFS team should coordinate with and build on other relevant plans, technical assistance, and investment undertaken by government, development agencies, non-government organizations (NGO) and/or community based organizations CBO, the private sector, and the informal sector.


3 STRUCTURE AND SCOPE OF THE PRE-FEASIBILITY STUDY

The specific scope and tasks addressed in a PFS will be set out in the TOR. Table 1 below summarizes the structure and content of a typical PFS and this framework should be utilized for both the Midterm and Final Reports.6 Any significant deviation from this template that is proposed by the PFS consulting team must be agreed with the relevant CDIA project manager.

Table 1: Structure and Content of a PFS

1 EXECUTIVE SUMMARY

1.1 Objectives Brief information of project objectives and background.

1.2 Summary of Analysis Summary of the PFS stages, brief description of current situation and context, and recommended projects and strategies including tentative cost estimate.

2 INTRODUCTION

2.1 Reporting Structure Brief introduction to the PFS, objectives of the report, and how it is structured.

2.2 Schedule Indicate the schedule of the study.

2.3 Consultant(s) and Counterpart(s)

Involved consultant(s) and counterpart staff.

3 KEY DEVELOPMENT ISSUES IN THE CITY

3.1 Current Situation

Indicate project area, policy and legislation, institutional structure and finance, analysis and overview of the current situation and its impact (successes and failures).

Possible diagnostic tools: political, economic, social, technological, legal, and environmental (SWOT/PESTLE).

3.2 Urban Development Context

Analyze previous urban development strategies, master and sector plans, and investment programs. Were they successfully implemented or not? If not, why? What are the implications for developing new investment programs and financing?

Highlight and briefly assess new urban development strategies and thrusts. Map investment trends, prominent sectors, neglected sectors, priority sectors, and spending review.

3.3 Initial Urban Governance Assessment

Examine relationships between the following: - Other service providers - State/provincial government - Private/business sector (public–private partnerships [PPP]) - Civil society - Citizens - Political representatives - Informal economy and sector

Conduct stakeholder analysis linking to investment planning and programming and assess the current institutional arrangements for implementing investment projects and programs.

6 The Inception Report can adopt any structure providing its output requirements (as summarized in Section 4) are met.


Are these successful? Where are the problems and will new modalities be needed in the future i.e., PPP, etc. (See Guide-lines for Urban Governance and Institutional Development)

3.4 Legal and Regulatory Assessment

Review existing legal and regulatory policies / frameworks (including environmental rules) that may have an impact on proposed project development. This analysis should encompass both the specific infrastructure investment and the means by which it may be financed / operated / managed / owned.

3.4 Initial Urban Poverty and Social Assessment

Identify the poor; areas where poverty is concentrated; review how they participate in investment decisions; what role they play in civic governance; identify trends in infrastructure investment for the poor; assess their needs, compare with priorities set by city. Gender analysis to be included (different roles, usage, needs and priorities of men and women).

Conduct a social policy analysis of previous investment programs in urban infrastructure areas. Map trends, patterns, and likelihood of future investment.

3.5 Initial Environmental and Climate Change Assessment

Highlight key environmental issues facing city; lack of infrastructure and its environmental and health effects as of now or in the future; identify regulatory framework, institutional capacity, and strategies for working with environmental sustainability.

Level of climate change awareness, preparedness; areas for mitigation and potential adaptation investment areas.

3.6 Initial Capacity Development Assessment

Identify where gaps exist in capacity—have these been addressed in the past; How is professional capacity built in the organization? What are the implications for urban infrastructure investment planning? Identify key focus areas for building capacity in taking city forward; prepare proposals for capacity development, including associated costs. Include examination of capacity for gender awareness in ongoing project development.

4 PROJECT IDENTIFICATION7

4.1 Recommendations

Study’s recommendations and analysis to improve the urban situation. Description of alternative technical options and preliminary design, and social, environmental, and institutional aspects.

4.2 Project Description

Project description for each technical option including: - Project title - Sector/Sub-sector - Location (maps, photos as required) - Implementing agency (institutional arrangements) - Technical description and aspects (as much detail as possible

7 CDIA has produced a set of Sectoral Guidelines covering urban renewal, slum upgrading, urban transport, energy efficiency, solid waste management, water supply, wastewater management and flood & drainage management. Upon request, the CDIA project manager can provide the PFS team with copies of these reports to assist with the conduct of the PFS.


on the scale, & scope of the project – assumptions are fine) - The project’s linkage to other urban project development,

possible synergies, innovative technology - Project benefits and outcomes - Beneficiaries - Social, poverty, gender impacts (gender disaggregated

discussion of project benefits, beneficiaries, and impacts) - Environmental impacts - Project capital costs (US$) broken down by major category - Operation & maintenance cost (US$) broken down if possible - Capacity development needs - Project implementation plan - Potential for private investment - Potential for community involvement/contributions

5 CROSSCUTTING ISSUES

5.1 Urban Governance and Poverty

Preliminary assessment of how the project is linked to urban environmental improvement, urban poverty reduction8, urban governance improvement, and social and gender specific opportunities and synergies. Elaboration of possibilities to satisfy needs within these crosscutting areas, possible synergies, and connection between formal and informal development and activities.

5.2 Adverse Environmental and Social Impacts

Preliminary assessment of possible adverse environmental and social (including gender specific safeguards) impacts and how to mitigate those by safeguards (environment, indigenous peoples and resettled people). Flag these issues for the anticipated feasibility study.

(Refer to ADB checklists on social and environmental assessments.)

6 FINANCIAL AND ECONOMIC ANALYSIS

6.1 Municipal Revenues

Analysis of the current municipal revenues, recurrent internally generated and other revenue (funds from irregular sources that can vary significantly from year to year). In addition, analysis of grants and loans situation.

6.2 Municipal Expenditure

Analysis of recurrent expenditure, other expenditure (operation and maintenance, possibly electricity, etc.) and development (capital) expenditure.

6.3 Project Costs Preliminary estimates and summary of project costs of identified and prioritized projects (from Section 4).

6.4 Project Revenues and Financial Viability

Identification of direct and indirect project revenues including proposed tariffs / charges and demand estimates.

Review the city’s current investment situation to derive a financial envelope to finance the identified investment projects.

Undertake financial analysis of the project (including FIIR).

8 The Consulting Team should refer to CDIA’s Seven Step Pro-Poor Project Design approach.


Elaborate various funding scenarios considering potential loans/grants from development banks, possible private investments, and government contribution. Produce financial statements projections as required to help evaluate viability. (Refer to ADB guidelines on economic and financial analysis.)

6.5 Economic Analysis

This will assess the overall costs and benefits of the project(s). An EIIR analysis is to be prepared in which the social and economic benefits of the investment(s) are assessed together with the financial analysis. Yardsticks used and underlying assumptions should be clearly presented and justified. (See ADB guidelines on economic and financial analysis.)

6.6 Linking to Finance

This is a critical element of the PFS. The team leader and financial experts in the consultants’ team should, at an early stage, consider from where the investment(s) might be financed and begin mapping the institutions that may be interested in financing projects or components of projects. Both public and private sector sources should be considered and consultants should set out clearly what needs to be done to attract the targeted institutions.

6.7 Conclusions Conclusion remarks of the current investment situation and the affordability to finance identified investment projects.

7 IMPLEMENTATION ARRANGEMENTS

7.1 Implementation and Operation Arrangements

Recommend and elaborate likely implementation and operation arrangements for the potential project(s) including possible potential for public–private partnership (PPP). Indicate possible institutional weaknesses and suggested measures to rectify the situation. Identify gender balance and inclusion in governance and implementation arrangements.

Investment programs / proposals need to be owned and endorsed by the public, political representatives, and other city stakeholders. This is especially true when national and/or domestic resources are being considered for co-financing program implementation. While this is the responsibility of city authorities and relevant government agencies, the consultants’ team must communicate the required process to the steering committee and assist where possible.

Produce a time line for proposed project implementation together with key milestones and outputs.

8 RISKS

8.1 Assessment Initial assessment of the key risks for each proposed project (political, institutional, social [including gender], economic, capacity, and environmental).

8.2 Assumptions

Identify the major assumptions made for recommended projects. Identify any critical factors outside the control of the recommended project and, if these occurred, would these prevent the achievement of the main objectives? These assumptions would be analyzed further at feasibility stage.


8.3 Risks

Identify broad risks to both implementation and sustainability. Indicate risk management strategies, if relevant (i.e. proposed risk allocation between potential implementing entities). To be further developed at the feasibility stage.

9 FORTHCOMING FEASIBILITY STUDY (if required)

9.1 Further Studies

Indicate the need and reasons for further studies, if required. Such studies may, for example, be needed to address an important gap or barrier that is presently hindering project development.

9.2 Feasibility Study Requirements

Briefly summarize the requirements to obtain required data and associated survey needs, required expertise, support facilities, locations, and institutions to be consulted, skills required on the team, and time requirements. Highlight the need for gender (or other) disaggregated data and analysis and the need for gender (or other) expertise.

10 CONCLUSIONS AND RECOMMENDATIONS

10.1 Conclusions and Recommendations

Summarize the conclusions and recommendations from the study. Highlight key issues and suggested way forward for the local government and/or city.

11 APPENDICES

11.1 Appendix 1 Initial Development Impact Assessment (IDIA) including the Design & Monitoring Framework (DMF)

11.2 Other Appendices To be attached as necessary, e.g., data and survey sheets, detailed technical descriptions and costing, project fiches, and key references, etc.


4 MANAGING THE PRE-FEASIBILITY STUDY PROCESS

The PFS is designed to be an inclusive, open, and consultative process. Though implemented through CDIA-supported consulting teams, the study must be conducted in partnership between the consultants and recipient city government or corporation. Each plays a key role in implementing the process.

4.1 Key Milestones in the Assignment

The consultants’ TOR will be the principal guide for conducting the PFS assignment. However, to ensure that the process is clear and structured, and the delivered output is coherent, the following steps are suggested (see Figure 2):

a) Pre-Mobilization Phase

A number of important activities will have taken place in advance of the consulting team beginning work. These include: one or more missions by CDIA staff to the city to review the situation and carry out initial data gathering (as described in associated mission reports), signing of a Technical Assistance (TA) agreement between CDIA and the City, and the preparation of logistical arrangements.

Prior to the Mobilization Phase the Team Leader must consult with the CDIA Project Manager to obtain copies of all relevant documentation and project information, to ensure that the scope and expectations of the assignment has been correctly understood, and to discuss any other matters that may impact upon the conduct of the PFS (e.g. non availability of a team member). It is also recommended that the PFS team study related programs and activities in the country to establish a sound understanding of the urban development situation being addressed.

b) Mobilization Phase

International and national consultants are mobilized to the project and the city location where initial meetings are held. This is an opportunity for the consultant team, city government representatives, and the CDIA core management team to be introduced to each other. This signals the formal commencement of the assignment. It is essential that the team leader, the deputy team leader, and other team members (where possible) attend these discussions to review TORs, counterpart responsibilities, logistical issues, and expectations from city officials. The CDIA experience shows that a good start sets the tone for the implementation of the assignment. It is also critical during this stage that cross cutting specialists and sector specialists are able to set the rules for collaborating with each other during the pre-feasibility study.

c) Inception Phase

An Inception Report is normally produced within 4 weeks of commencing the assignment. In consultation and partnership with the city government, the consulting team will have done the following:

Conducted a situation and/or gap analysis of specific urban and related sector(s).

Identified potential bottlenecks and/or challenges, highlighting locally available solutions.

Set the approach for the remaining stages of the study, having defined clear personnel and/or milestone schedules and study boundaries.


d) Midterm (Interim) Phase

A Midterm or Interim Report is normally submitted within 2–4 months of commencement. This report will document the situation and/or gap analysis across the key investment sectors and development themes (institutional, public finance, social, economic, environmental, political, and organizational) as required, and if not already described in existing documents, explain the process of identifying project options and sector priorities in consultation with a broad range of stakeholders.

The process of bringing priority projects to pre-feasibility table in terms of financial, economic, and social analysis should be well under way at this stage, and conducted in close consultation with the city government and other primary stakeholders. Experience shows this is to be crucial to broad ownership of investment ideas and projects. Training and institutional development activities conducted through stakeholder workshops or other similar activities may be under-taken during this phase.

e) Final Phase

A draft final report should be submitted 1 month before the completion date of the assignment. At this point, the consultants’ team and city government counterparts have already agreed on a set of priority projects, which have been subjected to pre-feasibility analysis and preparation. This includes concept (sketch) engineering design, financial analysis and internal rates of return (FIRR), economic analysis and internal rates of return (EIRR), social and poverty analysis, and environmental analysis.

The report will describe options and/or scenarios for project implementation. The report findings and proposed project investments will be discussed with stakeholders and submitted to CDIA once consensus between city representatives and other stakeholders is reached.

The draft final report (as well as the final report itself) should include in its Appendices the IDIA including the DMF and any other relevant material that may help the reader to understand how the final set of recommendations has been determined. For example, a long list of technical options may have been considered at interim report stage and it may be worthwhile to present these together with a summary evaluation in an Appendix.

f) Final Report

Once CDIA and city representatives have given the consulting team their comments and feedback on the draft final report, the Final Report should be consolidated and submitted within 2–4 weeks prior to the completion date. The Final Report should include all relevant topics set out in Section 3 and include all relevant material produced in earlier reports so that it can act as a stand-alone document.


Figure 2: Key Milestones in the Pre-Feasibility Study Preparation Process

Source: Cities Development Initiative for Asia

4.2 Preparing for the Post Pre-Feasibility Study Phase

Once the PFS final report has been submitted and the consulting team disbanded, there can be an uneasy vacuum, despite the fact that this is the start of one of the most important phases in the project cycle. This new stage presents a number of challenges and raises several important questions.

The consultants, city officials, and the CDIA core management team should explicitly consider the following questions and agree on the terms:

First, to which institutions, and in what form, should the final PFS reports be presented?

Who will now lead the process of mobilizing resources to finance the feasibility study?

Who will take responsibility for building political and public support for the investments identified in development strategies, master and sector plans, programs and the PFS?

What can CDIA do to facilitate this next stage where feasibility resources have not yet been earmarked?

The consultant team and the concerned CDIA CMT officer(s) should work with staff of potential financing and/or capacity building institutions to ensure a smooth transition. Typically, this might be with an ADB project preparatory technical assistance (PPTA) or a KfW feasibility study.


4.3 Counterpart Consultation

Counterpart consultation should be seen as a key priority activity. The following steps are recommended:

Establish and formally validate Steering Committee structure and counterpart contribution.

Establish sound working relationship with the city counterpart to strive for efficient team work and good cooperation thereby ensuring that key institutions are at all times engaged in the PFS production process and treated as equal partners.

Thoroughly explain and inform the counterpart when, and how many, consultants will be present in the city, especially if intermittent inputs are being used. Ideally this is done by providing a tentative staffing schedule and work plan to the counterpart.

Undertake field visits to locations of proposed activities to reach a full understanding of the development issues.

Together with the counterpart, discuss and identify the key issues impacting on the study and agree on how these issued ought to be addressed.

4.4 Data Collection and Management

In the interest of using scarce resources most effectively, maximum use must be made of existing data in producing the PFS (reasonable data are often available in local reports, but not necessarily in English), rather than generating new primary data, which will require prior approval by the CDIA CMT. Consultant teams are expected to use their professional judgment to make appropriate assumptions (and spell these out clearly in their report) in the absence of adequate data and where financial and time constraints prohibit the team from developing such data. Where the need for new data collection has been identified, the team must ensure the inclusion of men and women in participatory and qualitative data collection methods, and gender disaggregation of data.

4.5 Capacity Development

The transfer of skills and technology from the PFS team to city government counterparts is an essential element in the PFS process, even though constrained by the limited PFS preparation time in the consultant teams’ assignments. The following directions are consistent with the CDIA Capacity Development Strategy:

1. Joint working activities with city counterparts provide opportunities for transfer of skills, technology, and knowledge from the technical experts to their colleagues. Examples might include skills to design and conduct field surveys for transport projects, project prioritization and design, economic and financial analysis, presentation skills, and report writing, to mention a few. This methodology requires counterparts to be integrated into, and play an active role in, project teams.

2. Training sessions can be organized by either experts in the team or by CDIA-contracted staff—normally related to one of the number of tools developed in- house to build capacity within cities, for example, to prepare urban infrastructure investment planning and programming. The need and timing should be determined jointly by the city and consulting team.

3. CDIA has identified potential national partner organizations (NPOs) in the region, which have aims compatible with its mandate. NPOs offer cities the opportunity to access technical resources for preparing investment programs and developing organizational capacity in this field. For example, an NPO specializing in financing feasibility studies through private sector participation could be linked with a city government to build public–private partnership capacity.


With the help of the CDIA core management team, PFS teams and the city government need to assess where NPOs could best add value to the PFS process and how they can be involved with the city in the short, medium, and long term.

4. The PFS process should recommend capacity development measures, which will need to be taken up by the feasibility study team. A draft scope of work and/or terms of reference outline should be prepared if possible.

4.6 Monitoring and Evaluation Framework

The Initial Development Impact Assessment (IDIA) presented in Appendix 1 will be a key output of the PFS. It serves to ensure that the PFS intervention addresses the guiding principles introduced in Chapter 2 and should be attached to the final report.

One component of the IDIA is a design and monitoring framework (DMF)/log frame matrix. The DMF summarizes key expected outcomes, impacts, and activities; provides indicators for monitoring; flags risks; and describes proposed project activities for the investment. The development of the DMF, starting with a “problem tree,” is a very useful exercise in integrating team perceptions with those of city agencies and civil society stakeholders, thus, providing a shared vision of the task.9 Similarly, the team must ensure the inclusion of gender indicators, or provide justification for exclusion. A sample DMF is provided in Appendix 2.

The IDIA and the DMF also enable CDIA to monitor during post-PFS stage whether crosscutting themes and development objectives are addressed in the feasibility and subsequent implementation phase of the projects as envisaged in the PFS.

4.7 Quality Standards

CDIA expects the highest professional standards from its consulting teams. This applies to outputs and inputs of national and international experts. Failure to meet these standards undermines CDIA’s credibility as an institution at the forefront of sustainable urban development in Asia. Appendix 3 to these Guidelines sets out the minimum input and quality standards that must be applied in producing the PFS.

9 Reference ADB guidelines on DMF preparation, http://www.adb.org/sites/default/files/pub/2007/guidelines-preparing-dmf.pdf


APPENDIX 1: INITIAL DEVELOPMENT IMPACT ASSESSMENT (IDIA)

The Initial Development Impact Assessment (IDIA) helps to monitor and evaluate the impacts and relevance of the Pre-Feasibility Study components for CDIA's four development impact areas, which are (i) poverty reduction and inclusiveness, (ii) good governance, (iii) environment, as well as (iv) climate change adaptation and mitigation. Please fill out all four sections for each PFS component (of particular importance are anticipated positive impacts and safeguard measures for possible negative impacts). For each development impact area, the IDIA asks for a description of the relevant design features of the infrastructure component (e.g. gender separated seating in public transport) as well as the direct impacts of the infrastructure project (e.g. increased safety for vulnerable groups on public transport).

PRE-FEASIBILITY STUDY

City: …

Country: …

Infrastructure Sector: …

Date: …

CITY PROFILE

Briefly describe the profile of the city and peculiarities relevant for the PFS project (e.g. geographic location in flood prone area, city divided into subunits, name of the region/province etc):

…

SOCIO-ECONOMIC-ENVIRONMENTAL-GOVERNANCE CITY PROFILE

Data Value Year Source

City Population (absolute number) YYYY

City Land Area (in km2) YYYY

City Population density (per km2) #DIV/0! YYYY

City Population Growth (in %) 0% YYYY

City Average Income (in USD) $ - YYYY

City Poverty Incidence (in %) 0% YYYY

General Government Revenues (in USD) $ - YYYY

General Government Expenditures (in USD) $ - YYYY

Capital Investment Budget (in USD) $ - YYYY

SHORT PROJECT DESCRIPTION For example: A Medium Term Investment Program for Environmental Infrastructure and Pre-Feasibility Studies for Solid Waste Management and Drainage and Flood Protection.

…


STAKEHOLDER PARTICIPATION DURING THE PFS PROCESS AND PROJECT DESIGN Briefly describe the involvement of the city counterparts, the main political stakeholders, additional stakeholders (NGOs, communities, private sector, etc.) and target group in regard to the PFS process and project design.

…

PROJECT DESIGN AND MONITORING FRAMEWORK (DMF)

Please insert the DMF for the proposed infrastructure project from the PFS report.

Performance Targets/Indicators Measurement of the performance of the project objectives and outputs (quantitative)

Means of Verification Sources of data for verifying indicators

Assumptions and risks Conditions important for project success, but not controllable by the project

Project Impact High level effects of project

Project Outcome Direct effects of the Project (positive changes for the target group and/or area)

Outputs Facilities and services created by the project

Activities Actions required for achieving outputs

Inputs Physical, financial, and human resources to carry out project activities

Pre-Conditions Conditions to start the project

For additional information on drafting the DMF please refer to the Pre-Feasibility Study Guidelines, p. 9; CDIA Pre-Feasibility Study User Manual, p. 61; ADB Guidelines for Preparing a Design and Monitoring Framework, http://www.adb.org/sites/default/files/pub/2007/guidelines-preparing-dmf.pdf


PLEASE NOTE: IF THERE IS MORE THAN ONE PFS PROJECT COMPONENT PLEASE DUPLICATE THE TABLE FOR EACH COMPONENT

Title of Project Component1: e.g. Solid Waste Management, River Transport

Estimated number of beneficiaries of the project component: 000,000

Development Impact: Environment

Urban Environment Situation: Briefly describe the environmental situation in the city in general and in relation to the infrastructure project component. Assemble and present baseline data on the relevant environmental characteristics of the study area as well as the current level of infrastructure service provision. Include information on any changes anticipated before the subproject commences. (a) Physical environment: geology (secondary data); soils; climate and meteorology; ambient air quality; surface and ground water hydrology; existing water pollution discharges; receiving water quality.

…

During the city application process the following were the anticipated impacts recorded in the CDIA Checklist for Internal Screening and Monitoring of Applications:

Reduction of water losses and water consumption

Improved management and treatment of industrial waste

Improved treatment of household waste water

Improved treatment of hazardous waste

Improved treatment of industrial waste water

Improved urban bio-diversity (e.g. reforestation)

Improved storm water drainage and flood protection

Protection of cultural or natural heritage

Protection of ground water resources

Reduction of noise pollution

Protection of surface waters

Reduction of air pollution

Reduction of water borne diseases

Other (please specify):

Improved management and treatment of household waste

Please explain changes to the anticipated impact areas of the infrastructure project:

…


Does the component include environment design features? (environmental fees, greening of construction parts etc.)

If yes, briefly describe these elements:

…

Are there expected positive and direct anticipated environmental impacts?

If yes, briefly describe these positive and direct anticipated impacts:

…

Estimated number of beneficiaries of direct impacts on environment: 000,000

Anticipated negative impacts and safeguard measures: Briefly describe key negative impacts on the environment likely to be a result of the project and how these may be mitigated and safeguarded.

…



Title of Project Component: e.g. Solid Waste Management


Development Impact: Climate Change Adaptation and Mitigation

Urban Climate Change Situation: Briefly describe the climate change challenges the city is facing in general and in relation to the infrastructure project component (e.g. …).

…


Reduced Green House Gas (GHG) emission

Decreased exposure to the impacts of climate change (e.g. redundancies in water supply)

Improved energy efficiency of public transport

Increases in adaptive capacity (e.g. improved access to escape routes)

Improved energy efficiency of public buildings

Engineered to better cope with future climate variability

Increased capacity to rebound from extreme weather events

Other (please specify) :

Promotion of cleaner production

Please explain changes to the anticipated impacts of the infrastructure project:

…

Does the component include specific climate change adaptation or mitigation design features?


…

Are there expected positive and direct impacts on urban resilience?

If yes, briefly describe these positive and direct impacts:

…

Are there expected positive and direct impacts on reducing GHG?


…



DEFINTIONS OF KEY CONCEPTS: Inclusiveness = CDIA’s inclusive approach targets citywide improvement of infrastructure or service networks by providing all people in the city with equitable access to services. Emphasis is placed on trying to extend benefits to vulnerable groups either directly or indirectly. The inclusive approach maximizes benefits to the poor by supporting complementary interventions Gender = ‘refers to the social attributes and opportunities associated with being male and female and the relationships between women and men and girls and boys, as well as the relations between women and those between men.’ (http://www.un.org/womenwatch/osagi/conceptsandefinitions.htm) Gender Sensitivity: CDIA aims at mainstreaming gender sensitive design features and aspects into its interventions.

Title of Project Component: e.g. Solid Waste Management


Development Impact: Poverty Reduction and Inclusiveness


Secure tenure for urban poor in living areas

Improved access to sources of income

Improved access to basic infrastructure (water, sanitation, solid waste, public transport)

Improved protection from loss of resources/ security of sources of livelihood

Improved access to social services (basic health, education, etc.)

Equitable distribution (geographically) of public services throughout the project area

Affordable and equitable service fee and tariff structure


Less effort and time needed for securing basic services for the household

Are women stated as a specific target group? ☐ No ☐Yes (If yes, please specify below.)

Secure tenure for women headed households

Improved access of women to sources of income

Improved health of women and children


Improved access of women to social services (basic health, education, etc.)

Please explain changes to the anticipated impacts of the infrastructure project:

…

Urban Poverty and Gender Situation: Briefly describe the urban poverty situation in the city (poverty level in % by city/country definition) in general and in relation to the infrastructure project component.

…

Does the component include specific pro-poor design features?


If yes, what are these specific pro-poor design features applied to ensure that the project contributes to poverty reduction? Examples can be geographical targeting, household targeting, ensured affordability through fee adjustment or subsidies, design adapted to needs of the poor, involvement of informal sector for job creation, etc.

…

Does the component include specific gender equality design features?

If yes, what are these gender equality design features applied? Examples can be waste banks as a source of income, separate facilities on public transport, gender separated sanitation facilities, proper lighting of public transport shelters, equal access to capacity development programs, training for women community representatives, etc.

…

Are there expected positive and direct anticipated impacts on poverty reduction?

If yes, briefly describe these positive and direct impacts. Be specific, and quantify benefits where possible. Indirect impacts and general economic development are not to be discussed here. Examples can be improvement in water supply coverage from 30% to 70% in informal settlements, reduced flooding for 150,000 urban dwellers on flood-prone land, etc.

…

Are there expected positive and direct anticipated impacts on gender equality?

If yes, briefly describe these positive and direct impacts. Be specific, and quantify benefits where possible. Indirect impacts and general economic development are not discussed here, although important. Examples can be improving basic levels of mobility for women, increased safety of usage of public transport for women, women’s empowerment, etc.

…

Please estimate the number of beneficiaries belonging to the following vulnerable groups:

Estimated number of poor beneficiaries of direct impacts: 0

Estimated number of female beneficiaries of direct impacts: 0

Estimated number of children among beneficiaries of direct impacts: 0

Estimated number of disabled beneficiaries of direct impacts: 0

Estimated number of disabled beneficiaries of direct impacts: 0

Estimated share of poor beneficiaries in relation to total target population of proposed project component:

Briefly describe anticipated negative impacts that are likely to be a result of the project and how these may be mitigated and safeguarded. Examples can be resettlement and relocation as part of the project impacts, negative impacts on formal or informal employment, negative impacts on assets and access to services, negative impacts on safety.

…



Title of Project Component: e.g. Solid Waste Management, River Transport


Development Impact: Good Governance


Participation in decision-making and planning

Improved internal organizational structures and procedures

More equitable service fees and tariffs

More efficient organizational set-up / spin-off of utilities

Improved bottom-up planning processes & participation mechanisms

Improved inter-municipal or inter-regional cooperation

Transparency and accountability of city government

Better coordination with other government levels

Strategic orientation of city government and management


Better customer/client orientation of city services

Governance and Financial Management

Does the municipal budgeting process incorporate stakeholder engagement practices?

Is the annual municipal budget being published?

Has the municipal budget been balanced over the past 3 years?

Is municipal budget performance externally audited?

Has the municipality a sustainable debt servicing?

Please explain changes to the anticipated impact areas of the infrastructure project:

…


Urban Governance Situation: Briefly describe the dynamics of governance in the city with a focus on urban service provision and delivery. (Specifically comment on the following: Formal - informal structures and relationships in the city, Decision-making processes in infrastructure development i.e. who is involved and what role do they play, Level of public consultations on key infrastructure investments (formal vs. informal), Participation in the project development of investments, Inter-departmental cooperation on project development, Inter-agency coordination in project development, implementation, management and service delivery.)

…

Does the component include specific good governance design features? (Creation of a SPV, new administrative/management structures, e-governance tools for complaint management, structures for future public participation etc.)


…

Are there expected positive and direct impacts on good governance?


…

Anticipated project risks related to governance and measures to mitigate this: Briefly describe key risks related to governance and which measures are suggested to mitigate these risks

…


PLEASE ONLY INSERT THE INVESTMENTS PER PFS COMPONENT ON THE RIGHT HAND SIDE

Relevance of the Infrastructure Investments by Development Impact

Environment

Climate Change

Poverty Reduction Good

Governance Investment

Component Relevance* Relevance* Relevance* Benefit to

Urban Poor* Relevance*

Mio. USD

%

1. Title Please rate Please rate Please rate Please rate Please rate $ -

#DIV/0!

2. Title Please rate Please rate Please rate Please rate Please rate $ -

#DIV/0!

Total Investment

$ -

#DIV/0!

*FOR INTERNAL USE: CHOOSE FROM DROPDOWN MENU IN TABLE ABOVE

Dropdown Menu Options

Please rate Please rate

Benefit to Urban Poor

low 1

1 = Almost exclusively benefits non-poor groups

medium 2

2 = Benefits non-poor to a larger extent than poor groups

high 3

3 = Benefits poor groups to the same extent as other groups

4

4 = Benefits poor to a larger extent than non-poor groups

5

5 = Almost exclusively benefits poor groups


APPENDIX 2: SAMPLE DESIGN AND MONITORING FRAMEWORK

Design Summary Performance

Targets/Indicators

Data Sources

Reporting Mechanisms Assumptions and Risks

Impact

Healthier living among

citizens

Decrease in waterborne

diseases….by xxx%

Monthly progress reports

Quality of life surveys

Improved city environment

and quality of life

Effective industrial/solid

waste management

A. Political support

A. Environmental improvement

is a development priority

Outcome

Investments in

infrastructure

Informal sector working

with government

PPP formalized

Project monthly/quarterly

reports

EIA’s by government

Environmental health

surveys

1. Municipal infrastructure

replaced

2. Improved primary waste

collection system

3. Private sector involved

A. Availability of adequate

financing

A. Commitment to work with

new stakeholders

Outputs

Construction complete

Construction complete

Reforms under way

Project completion reports



1. Build xxx number of

transfer stations

2. Build xxx number of landfill

sites

3. Institutional and

organizational development

A. Political support

A. Adequate financial

resources

A. Commitment to change

Activities

1. Establishment of OMU/recruitment of staff logistics

2. Participatory planning/programming

3. Social/environmental/economic impact analysis

4. Institutional restructuring

5. Organizational training and development

Inputs

ADB: $150 million

Consulting services

xxx PMs: $xxx million

Civil works: $xxx million

Equipment: $xxx million

Training: $xxx million

Contingencies: $xxx million

Government: $xxx million

Personnel

xxx PMs: $xxx million

Transport and logistics:

$xxx million

Operating expenses:

$xxx million

ADB = Asian Development Bank, A = assumption, PM = person month, R = risk.


APPENDIX 3: QUALITY STANDARDS

The following minimum input standards apply:

a) PFS Consulting Teams

1. All national and international experts must provide their inputs in the project location/site. Inputs to be made away from the project site must be clearly justified.

2. Consultant teams must provide inputs to and participate in steering committee meetings and periodic stakeholder consultations. Their participation ensures quality, anchors the pre-feasibility study findings, and represents important milestones in the PFS process. This applies especially to team and deputy team leaders.

3. The CDIA sees relationship management as a critical element in the PFS process. Team and deputy team leaders are expected to foster positive relations with their respective city counterparts. Failure to achieve this can undermine the credibility of the PFS process and products, and ultimately the CDIA. The CDIA core management team (CMT) will facilitate this process as may be required.

4. Consultant teams must work closely with their counterparts in local government and, where applicable, in CDIA national partner organizations, to integrate and institutionalize PFS processes and outcomes into the planning and development processes of the client city government.

5. In the unlikely event of conflict between the PFS team and the city government, or failure to deliver outputs to international standards, the CDIA will hold the lead firm responsible for discharging the assignment and the project director and/or team leader accountable for performance deficiencies.

6. The CDIA CMT must review the integration of crosscutting issues, including gender, in the consultants’ report.

b) City Governments

1. City governments that have agreed to work with CDIA must do so within the framework of a technical assistance agreement with CDIA. The agreement governs the relationship between CDIA, the city government, and the PFS consulting teams on the ground. To ensure a successful PFS outcome, CDIA expects that city governments will meet the commitments set out in the agreement and provide any other reasonable requests for assistance.

2. City governments are expected to deliver on their agreement to provide counterpart contributions and information stipulated in the technical assistance agreement in a timely manner, so as not to delay the implementation of the study. City governments are required to nominate officers from relevant departments to work with the consulting team during the study, and ensure they are available at reasonable notice.

3. City governments must constitute a project steering committee and facilitate its operation. The steering committee is the structural mechanism by which CDIA, the PFS consulting team, and the city government are able to assess progress, determine direction, and ensure that quality is maintained during the study. Timely guidance from the steering committee is crucial to a successful outcome of the PFS.


c) CDIA Core Management Team

1. The CDIA core management team will provide oversight and quality assurance to the PFS process and support from Manila where deemed necessary.

2. The team leader will maintain regular contact with the assigned CDIA CMT member and provide regular progress updates (frequency to be agreed).

3. The CDIA CMT will monitor progress against the agreed-upon terms of reference and deliverables. All payment invoices will be approved only upon delivery of agreed outputs to the satisfaction of CDIA and the city government.

4. The CDIA CMT will provide the PFS consulting teams with support, where necessary, to execute the assignment successfully.

At the end of the study, the CDIA CMT will evaluate the internal performance of the PFS.


APPENDIX 4: PRE-FEASIBILITY, FEASIBILITY AND PPTA STUDIES

Document Type Content & Purpose Summary

Pre-Feasibility Study (PFS) Rapid assessment of project merit conducted in a 3-6 month period

Provide a range of technical options and associated analysis based

on an evaluation of practical feasibility, affordability as well as

financial and economic viability together with a summary of the

advantages and disadvantages identified for each option

Preliminary environmental, social, poverty and institutional /

governance assessments

Give a recommendation of the most feasible option in

consideration of mid- to longer-term implications

Elaborate a strategic investment plan for the short, medium and

long-term including possible links to financing

A good PFS will significantly enhance the quality of a subsequent FS

20% accuracy/error margin

PFS cost ~USD $250,000-350,000

Feasibility Study (FS) Considerably more in-depth project analysis that takes at least 9

months

Detailed technical design produced in relation to each investment

Highly detailed financial, environmental, institutional and social

analysis also conducted on selected sector-specific option

Detailed investment plan with clearly defined outputs / milestones

Explicit links to financing (including, potentially, draft / template

contracts)

10% accuracy/error margin

FS cost ~USD 1,000,000-1,500,000

Project Preparation Technical Assistance (PPTA)

A PPTA is usually produced to help governments identify and prepare feasible projects. As such, they vary from presenting relatively general project descriptions if no specific intervention has been identified ahead of time to (more usually) providing very detailed project analysis if a particular activity or undertaking has already been specified. Elements that you would expect to find in a PPTA include:

A technical assistance report that will contain a more detailed

technical, institutional economic financial, social and

environmental analysis than you would find in a PFS but not quite

as detailed as would be found in a full FS.

Poverty and social analysis to identify those people who may be

beneficially or adversely affected.

Safeguard assessments if the project requires resettlement of

people or might adversely impact the environment, or indigenous

peoples. The results of these assessments are disclosed and made

available to affected people and other interested stakeholders.

Detailed funding proposal for carrying out the project together

with a Financial Management Assessment concerning the recipient.

Procurement plan in support of the funding proposal.

http://www.adb.org/projects/documents/search/subtype/technical-assistance-reports-1223

http://www.adb.org/projects/documents/search/subtype/initial-poverty-and-social-analysis-1196

http://www.adb.org/site/safeguards/involuntary-resettlement

http://www.adb.org/site/safeguards/involuntary-resettlement

http://www.adb.org/site/safeguards/environment

http://www.adb.org/site/safeguards/indigenous-peoples

http://www.adb.org/site/safeguards/indigenous-peoples

Cities Development Initiative for Asia

Suite 201-203 Hanston Building, F. Ortigas Jr. Rd. (Emerald Ave.) Ortigas Center, Pasig City 1605

Metro Manila, Philippines Phone: +63 2 631 2342 • Fax: +63 2 631 6158

Website: www.cdia.asia

CDIA is supported by:

Pre-Feasibility Study Guidelines · 2020. 12. 15. · area shown in Figure 1—the Pre-Feasibility...

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