ASIAN DEVELOPMENT BAN STER EN! RESTRICTED PCR:PHI 12025 This Report has been prepared for the exclusive use of the Bank. PROJECT COMPLETION REPORT OF THE BICOL RIVER BASIN IRRIGATION DEVELOPMENT PROJECT (LOAN NO. 417-PHI) IN THE PHILIPPINES August 1990No re Currency "At Reappraisal At Project Completion Unit September 1979 December 1989 $1.00 7.3715 $22.50 1.00 $0.1357 $0,044 : During the Project implementation, the exchange rate of the Peso was determined on the basis of a floating rate system related to daily foreign currency transactions of the banking sector ABBREVIATIONS BRBDPO = Bicol River Basin Development Program Office DAR = Department of Agrarian Reform DA = "Department of Agriculture DENR = Department of Environment and Natural Resources DPwH = Department of Public Works and Highways EEC = European Economic Community FI¢ > Farmers’ Irrigators Group FMT > Farm Management Technician TA = Inrigators’ Associations ISF - Irrigation Service Fees Lac - Local Minor Contracts NIA - National Irrigation Administration Nec - National Power Corporation 8a = Operation and Maintenance POF - Pilot Denonstration Farm : RIS - River ‘Irrigation System SAP - Special Supplementary Assistance to selected Projects spp + Silt Detention Dam . SPIAL = Special Projects Implementation Assistance Loan NOTES (i) ‘The fiscal year in the Philippines ends on 31 December. (it) In this Report, "$" refers to US Dollars and "Mission" refers to the POR MissionNote PCR:PRI 103 PROJECT COMPLETION REPORT OF THE BICOL RIVER BASIN IRRIGATION DEVELOPMENT PROJECT (Loan No, 417-PHI) IN THE PHILIPPINES JULY 1990 This Report was prepared by a POR Mission comprising S.A. Naqvi (Senior Project Engineer/Mission Chief), R. Paris (Project Economist/Y.P.), and Cynthia Alvarez (Project Administration Assistant). The Mission visited the Project area from 25 to 29 June 1990, as a follow-up to the Bank Mission comprising ¢. D Burgh Codrington (Senior Project Engineer/Mission Chief), and R. Collier (Consultant) who visited the Project area from i3 to 23 February 1990 and held a meeting with the Government/Executing Implementing Agencies on 09 March 1990 in Quezon Gity, Metro Manila.MAP 1: MAP 2: MAP 3. BASIC II. III. TABLE OF CONTENTS Bicol River Basin Irrigation Development Project = Location Map Naga-Calabanga Irrigation System 1: Rinconada Irrigation System DATA . PROJECT DESCRIPTION A. Preparation and Appraisal B. Objectives, Rationale and Scope C. Implementation Arrangements EVALUATION OF IMPLEMENTATION A. Project Components B. Project Costs ©. Project Implementation Schedule D. Engagement of Consultants and Procurement of Goods and Services E. Performance of Consultants, Contractors, and Suppliers F, Compliance with Loan Covenants G. Disbursements H. Environmental Impact I. Operation and Maintenance J. Project Benefits K. Performance of the Borrower Executing ‘Agency and Implementation Agencies L. Performance of the Bank CONCLUSIONS AND RECOMMENDATIONS A. Conclusions B. Recommendations APPENDIXES Page aay (ity (iv) w) u i 12 12 13 3 13 15 7 V7 18 19 19(iy Map 1 BICOL RIVER BASIN IRRIGATION DEVELOPMENT PROJECT 10N & LOCATION MAP wae \ = : i cee | \ @ % it | 2 ‘ o “A \ Leceno a z \ Irrigable Area \ , | TEES vetotod area / a Watershed Protacton eo oy { National Highway \ Provincial Bounstry \ TTR asin Bouncy \ Flood Convo Levee \ me ee ain cones(A444) BICOL RIVER BASIN IRRIGATION DEVELOPMENT PROJECT NAGA-CALABANGA IRRIGATION SYSTEM LEGEND: > Diversion Canal LateraleSub-Laterais © Damintake ‘on a © Hoadgato of Laterale/Sub-Laterals == River Creek or Waterways seem: Main Oran {All Weather Roads © Town tturicipalty @ capita or city mito tigable Ares n= Projet Area Boundary © Convolsruetre Leveo with RoadwayGy) MAP 3 BICOL RIVER BASIN IRRIGATION DEVELOPMENT PROJECT RINCONADA IRRIGATION SYSTEM back LEGEND: atid + Diversion Canal oo Lateraie Sub Laterais @ Dam intake ® — Heasgate of Lateraie‘Sub-Latorals Fiver!Gre0k or Waterways wee Main Drain All Woather Roads TownMricipalty © Capital or City Limit of rigabie Area Project Area Boundary © contratsiueture SETH Levee with RoadwayA. Loan Identification 1. Country 2. Loan No. 3. Project Title 4. Borrower 5. Executing Agencies 6. Amount of Loan B. Loan Data 1. Appraisal Date Started - Date Completed 2. Loan Negotiations = Date Started - Date Completed 3. Date of Board Approval 4, Date of Loan Agreement 5. Date of Loan Effectiveness + in Loan Agreement - Actual = Number of Extensions 6. Closing Date + in Loan Agreement - Actual Number of Extensions w) ‘BASIC DATA Republic of the Philippines 417-PHI supplemented by (i) Special Assistance Project (SAP) Loan No, 628-PHI (Ai) Special Project Implementation Assistance Loan (SPIAL) Loan Nos. 779/780-PHI Bicol River Basin Irrigation Development Project Republic of the Philippines (i) National Irrigation Administration Gi) Department of Public Works and Highways (44i) Department of Environment and Natural Resources $41.00 million (Loan No. 417-PHI) $ 4,00 million (Loan No. 628-PHI) § 2.78 million (Loan Nos.779(SF)/780-PHI) $ 5.80 million (EEC Grant) $53.58 million (Total Lean Amount) 14 June 1979 04 July 1979 13 September 1979 13 September 1979 25 October 1979 07 November 1979 07 February 1980 02 April 1980 one (1) 31 December 1985 05 October 1989 three (3)1. Vv as 7. Terms of Loan - Interest Rate = Maturity = Grace Period 8. Disbursements (a) Dates Initial Disbursement 27 February 1981 Effective Date 2 April 1980 (b) Amount (US$) catenory CONSTRUCTION MATERIALS Te Steel Bars and Sheet Piles a." Zerigation * Comp A 3! Flood’ Conteoa’* Coup B €) Agricultural Dev = Coap © 4: $511 conservation ~ Coup P 2, Cement, Fust Olt & Steel Gat Ca" Cav Wonks Contracte Terigation ~ comp A £) Flood’ Control. = Coup B Soil Conservation = Coup F fin Force Aceount Honea 3 z Hoof Gontcot = Coup 8 Agticalturel Dev = Comp © Sil Consecvation ~ Comp © Treigation ~ Comp A Foot Contcol = Comp 8 Agricultural Dev > Comp € OFFICE Aw TRANSPORTATION BoUrPHENT Terigetion ~ Comp Flood Control = Comp 8 ‘Agricultural Dev = Comp C Soil Conservation ~ Comp F a. Terigation ~ Coop A 3! Flood Gonteot "Comp 1 Soll Conservation = squimee : 9. Local Cost (Financed) = Amount - Percentage of Local Cost - Percentage of Total Cost (wi) : 7.6 per cent per annum + 30 years i 7 years Principal, interest and other charges to be payable semi-annually Final Disbursement 5 October 1989 Original Closing ——Date__ 31 December 1985 1,662,000 33,000 nek. In TA 3000 3,200,434 21343, nel. an fia 130,496 4005 308,000, 72368 ‘6,000,000 8,000,000 ‘4,006,000, 2 1,900,001 $3,900,008 : $16,885 million 44 per cent 23 per cent ¥ “Cancelled on 5 October 1989. Time Interval 8 years - 7 months Time interval 5 years - 8 months wee Amount Undisbureed pisburaed 52,016 ° mi 2,945,138 1,362,407, Lovo! ta 125280, 85,351 19,608 064,214 (1,800,237) oo on] 37,098 7.308 3,054,073 354,559 21343 ° 364,200 52,378 elise aia) $9,030 os.) 130,438, ° 24003 ° 721388 o ess2.005. 2.246,002"/(vit) Appraisal Revised Estimates Estimates Actual Project Cost (a) Foreign Exchange Cost 34.000 34.762 34,121 (b) Local Cost 48.700 34.201 38.554 (e) Total Cost 82,700 68.973 72.675 2. EL lan ($ Mi11i0% iets of Finan ical Total Bank Financed 31.000 10,000 41.000 30,660 14,400 45.000 29.547 16,885 45.422 a/ D. Borzower Financed = 28,900 35.900 = 19,500 19,500 21.869 22.660 Other Beternal Financing 9.000 2,800 3,000./ 4,200 1a.s00 asm ase (eee Grant) Total 34.000 49.700 g2,700 480 34,200 $9,000 gh ses 2,675 ‘3. Gost Breakdown by Project Components ~israleal Eatinated "Revised ———— Source of Fis Foreign Local Total__ Forelen —Laeal Total A Irrigation Facilities 2.025 15.925 24.950 13.508 13.637 1ig92 28.737 27.736 3B. Flood control 2108 “s!o03 “ol1c1 “Sioa "51783 4500 7.660 2.400 1. Equipoent. istese) eoeres: | (scecnl = fylazes eaten ais 7893 “acor3 THT. Agricultural Development 168 soy “67S tnalnded in Team A ee IV. Farmcto-Market Roede 8351.38) 2.402 “2ai” 9.965.571 2.426 2.803 5.388 V. Rurel Water Sopply nose eas Tu Tass 0 2e5o 3s sas ees VI. Erosion Control $6 aa Loa apes pel | izes case | ioso) | arses VII! Contultaney Servic soo iis eis ey gy 35h te Dt VIE, Froject Fassliti $3) 37.911 tnclnded in Them A sto G0 Tk! Project Administration 2 4MtS ALAS ee 5S 735 Sates 9.303, %. Land Acquisition a S 2 isa ise = es 265 xa 2.607 4.798 7.543 ea Lage 96 : : x, eve 32283 aol7s@ __e95 1a yee = Subtotal, 78.009 48.700 76,200 25.762 34.212 59.979 25.221 ess 69,675, want, 100 6.009 = 6.000 $000 = 9,000 9,000 = 9.000 Total 24.000 48,700 gz.700 pares BAN OOD BI BES 22.875 2/ Includes supplementary loan of $4.0 million under SAP loan and §2.78 million under SPIAL. b/ —_—EEC Grant of 4.5 million European Unit of Account (EUA) is now equivalent to $¢.5 million4, Project Schedule (a) aw ay (in (b) «e) (a) ce) (viii) Appraisal ‘Target ___ Date of Contract with Consultants Irrigation Component (44 man-months) A. K, Mitra (Irrig. Engineer) Sept 1980 N. M. Tog (Hydrologist) Sept 1980 H.C. Dingra (Electrical/Mechanical Engineer) Jun 1981 S. Ray (Design Engineer) Jun 1981 Control and Draina; -nonthi S.P, Garg (Flood Control Expert) Sept 1980 So vation Works (18 man-months M. Greeny Jan 1981 Completion of Engineering Designs Dec 1984 Civil Works Contract Date of Award Jan 1981 Completion of Work Jun 1985 Equipment and Supplies Dates First Procurement Last Procurement Start of Operations Completion of Test and Commissioning Naga Calabanga Rinconanda May 1981 May 1981 Sep 1981 Mar 1982 May 1981 oct 1981 Mar 1986 29 Nov. 1982 June 1988, May 1981 Sep 1989 Sep 1989 Mar 1990(ax) (e) Data on Bank Missions Type oF Wo. of No. of Specialization ssion Date Persons = Mandays. of Members Appraisal Mission 1s June- 5 as acdet 4 July 179 Inception 18-22 Aug’80 2 10 ad Ist Review 9-12 Feb’81 3 2 ale,4, 2nd Review 3-13 Nov's1 1 3 a 3rd Review 16-19 aug'82 2 8 ad 4th Review 2-11 May’ 84 1 9 a 5th Review 21-28 Jan'a5 2 wu ae 6ch Review 2-8 July’86 3 18 ace 7th Review 27-31 July’87 1 4 a 8th Review ‘19-28 Apr’88 3 28 big h 9th Review 18-25 Apr'89 2 4 big, loth Review 27-29 Sep’89 2 6 ab PcR 13-23 Feb‘ 90 2 20 ah PCR Follow-up 25-29 June ‘903 wz ace => engineer © - prograns officer b- financial analyst £ - counsel © - economist & - project administration staff 4 - agronomist h - consultant Note: There was no Review Mission in 1983. However, a TA Inception Mission for the Proposed Sorsogon Integrated Area Development Project was conducted from 19- 30 April 1983. The TA mission also reviewed the BRBDP which was similar in nature as the proposed Project. ¥ Jointly with other Bank-assisted irrigation Projects in the Philippines.I. PROJECT DESCRIPTION AL Pe ra L Based on the feasibility studies for the integrated agricultural development of the Naga-Calabanga and Rinconada areas of the Bicol River Basin prepared by the Government in the mid-seventies, a single project, combining the two areas, was formulated by a Government Task Force. The report of the Task Force was submitted to the Bank in May 1979 and the Proposed Bicol River Basin Irrigation Development Project was appraised by a Bank Mission in June-July 1979, ae In October 1979 the Bank approved a loan of $41.0 million from its ordinary capital resources for the Bicol River Basin Irrigation Development Project. The loan became effective on 2 April 1980 and the closing date was 31 December 1985. Subsequently, the European Economic Community (EEC) provided a grant of 4.5 million European Units of Account (EUA), equivalent at that time to $5.8 million, to finance the rural water supply and farn- to-market roads components of the Project. Of the total estimated Project cost of $82.7 million, the Bank loan was to finance $25.0 million of the foreign exchange cost, $10.0 million of the local currency cost and $6.0 million for interest and other charges during construction (IDC). The EEC grant was to finance $3.0 million of the foreign exchange cost and $2.8 million of the local currency cost. The remaining local currency cost equivalent of $35.9 million was to be financed by the Government. a In May 1983 the Bank approved a Special Assistance Program (SAP) for selected ongoing Bank- financed projects in the Philippines (Loan No. 628- PHI) under which supplementary financing of $4.0 million was provided for the Project, increasing the Bank financing to $45.0 million. In April 1986, the Bank approved two Special Project Implementation Assistance Loans (SPIAL) (Loan Nos. 779(SF) and 780-PHI), from the proceeds of which an amount of $2.78 million was utilized on the Project. Consequently, the total financing approved by the Bank for the Project amounted to $47.78 million. B. Objective, Scope and Rationale 4 ‘The Bicol River Basin is part of Bicol Region which was, and still is, one of the most depressed regions of the Philippines. The Government was therefore keen to develop the resources of the basin in order to bring it into the mainstream of national development progress. 5 The main objectives of the Project were to: increase rice production, improve rural income, create employment opportunities, and upgrade the living standards of the rural population in the Project’ area through the provision of infrastructural facilities 6. The Project, as originally appraised, envisaged the development of 4 total area of 17,310 ha, comprising two entirely separate sub-areas: (a) 7,130 ha in Naga-Calabanga, and (b) 10,180 ha in Rinconada (see Map 1), The Project area is, on average, about 12 m above mean sea level at Rinconada2 and 3 m at Naga-Calabanga near the estuary of the Bicol River. Most of the area is flat and on the flood plain of the Bicol River which flows out of Lake Bato in a north-westerly direction for about 95 km to San Miguel Bay (see Map 1). Between June and December, the area can be subject to major tropical typhoons which bring excessive rains causing extensive flooding and crop losses 7. The Project scope was designed to include the following components (4) irrigation, (both gravity and pumped) and related facilities for 17,310 ha including rehabilitation of 5,250 ha; (41) flood control works including levees, maindrains, river dredging, tidal gates and flood diversion structures; (441) agricultural development - establishment of water management demonstration and training farms; (iv) erosion control and soil conservation for about 1,800 ha in the Lake Bato watershed area; (~) construction and rehabilitation of farm-to-market roads; (vi) provision of rural water supply facilities; and (vii) provision of consulting services 8 The irrigation facilities included construction of two pumping stations, one in Naga-Calabanga area for irrigating about 3,590 ha and the other in Rinconada area for irrigating 1,820 ha. However, due to high operation and maintenance costs and inability of the farmers to pay irrigation fees to meet such costs, the executing agency and the Government formally requested the Bank in December 1985 to approve deletion of the pumping schemes from the project scope. In January 1987, the Bank approved the Governnent’s proposal. 1/ The deleted areas are shown in Map 1. Accordingly the area to be irrigated under the Project was reduced from 17,310 ha to 11,900 ha, comprising about 3,900 ha in Naga-Calabanga and about 8,000 ha in Rinconada. The layouts of the irrigation and flood control and drainage works in Naga-Calabanga and Rinconada areas are shown in Maps 2 and 3 respectively. c. Im Arrangements 2. ‘The National Irrigation Administration (NIA) was designated as the principal executing agency responsible for the design and construction of irrigation and related facilities and for the establishment of water management demonstration and training farms. The Department of Public Works and Highways (DPWH) was responsible for the design and construction of flood control works as also for the rehabilitation and construction of farm-to- 1/ See Doc. R6-87 dated 13 January 19873 market roads and for the construction of rural water supply facilities. The watershed erosion control and soil conservation component was implemented by the Department of Environment and Natural Resources (DENR). The Bicol River Basin Development Program Office (BRBDPO) was entrusted with the responsibility of interagency coordination at the field level. 10. For the implementation of the Project, NIA established and operated ‘a Project-Management Office (PMO) at Magarao in Naga-Calabanga area, headed by a full time Project Manager. The PMO included four Divisions (Engineering Administrative, Equipment, and Agricultural and Institutional Development), each headed by a Division Chief and also a field office for the Naga- Calabanga sub-project. A field office for the Rinconada sub-project vas established and operated at the town of Baao. DPWH, for its part, established and operated a PMO at Camaligan, headed by a Project Manager and a field office at Naga City. The Project Managers of NIA and DPWH reported directly to the respective Central Offices at Manila. The Project Office for the Erosion Control and Soil Conservation component was established and operated under the Regional Office of the DENR. The BRBDPO carried out the Coordination activities through a sub-committee of the Bicol River Basin Coordinating Committee. nu. The major civil works for the irrigation component involved construction of three diversion dams and five main canals under major contracts awarded on the basis of local competitive bidding (LCB) while all other irrigation works, including construction of laterals and other works of the irrigation distribution system, were carried out through local minor contracts, small package contracts and force account. Except for the excavation of a drainage channel and the dredging of Bicol River, which were carried out through force account, all other works under the Flood Control component were carried out through contracts awarded on the basis of LCB. Similarly, the rehabilitation and construction of farm-to-market roads and the construction of water supply works was carried under LCB contracts Construction of 44 check dams and a multi-purpose building for erosion control and soil conservation component was carried out under LCB contracts, while 15 secondary check dams and other works were executed through force account. All procurement of goods and services was carried out in accordance with the Bank’s Guidelines for Procurement. About 84 man-months of consulting services were provided by the individual consultants engaged by the executing agencies following the Bank's Guidelines e Use_of Consultants.Ir. ON OF ATION 12. At the time of appraisal, the Project was expected to be completed by 30 June 1985. However, it was only at the end of 1989 that the project with revised (reduced) scope was substantially completed. At this time however, one of major structure under the Flood control component was still to be completed. The principal causes of the delay in project implementation are discussed below. 13. There was an initial delay of about one year in finalizing detailed designs and preparation of tender documents for the irrigation and flood control components. The work under the first civil works contracts for irrigation and flood control facilities only started in early 1983, more than two years behind the schedule drawn up at appraisal. Subsequent problens were encountered in connection with the acquisition of right-of-way requiring protracted negotiations and litigation over compensation claims, As indicated above, the project area is located in a region that is subjected to frequent typhoons. Apparently, insufficient allowance for delays due to typhoons was included in the implementation schedule formulated at appraisal. Unfavorable weather and persistent law and order problems impeded project implementation significantly. A major constraint on Project implementation was the Government's difficulty in providing counterpart funds to the executing agencies. The adverse economic conditions that the Philippine economy faced during 1983-1986 and the resulting ceiling on public spending meant that budget allocations for the executing agencies could finance only part of the programmed expenditures, This constraint was mitigated to a considerable extent by the Bank's SAP for selected projects approved in May 1983 and the SPIAL approved in April 1986 (see para. 3) A. Brofect Components. rigation and Related cs A comparison of the irrigation and related facilities as actually constructed with those envisaged under the original and revised project scope is presented in Appendix 1. The relevant matters and the individual sub- components are discussed in the following paragraphs. jervice Area/Land Developme! as As a result of the deletion of the pumping schemes from the project scope (see para 8), the area to be irrigated was reduced from 17,310 ha, envisaged at the tine of appraisal, to about 11,900 ha. On the basis of the information furnished by NIA (see Appendix 2), it was noted that the irrigation system for gravity command was actually designed for about 12,300 ha, (4,312 ha in Naga-Calabanga and 7,988 ha in Rinconada). The area “generated” (actually provided with irrigation facilities) is reported to be about 11,900 ha, while the “firmed up" (the area which can actually be irrigated) is 11,361 ha (4,084 ha in Naga-Calabanga and 7,257 ha in Rinconada), The “firmed-up" area includes a total of 4,470 ha served by rehabilitated systems (900 ha in Naga-Calabanga and 3,570 ha in Rinconada)5 It is further noted that the total area irrigated during the current 1990 wet season is 8,722 ha (3,860 ha in Naga-Calabanga and 4,862 ha in Rinconada) or 77 percent of the "firmed up" area. 16. Of the “firmed up" area about 1,960 ha in Rinconada is at present only a single crop area. This includes 940 ha in the expanded area of Barit River Irrigation System (BRIS) which does not receive sufficient water from Lake Buhi due to the still unresolved problems relating to the operation of the lake to meet the competing demands of irrigation, power and fisheries. The Mission was informed that although the matter regarding irrigation and power has been resolved between NIA and NPC, the local administration has imposed restrictions on the draw-down level of Lake Buhi to protect the interest of the fishermen. Government intervention seems necessary to resolve the matter. 7 The present unirrigated area of 2,620 ha (224 ha in Naga-Calabanga and 2,396 ha in Rinconada) includes an undeveloped area of 721 ha (286 ha in Naga-Calabanga and 435 ha in Rinconada). The undeveloped area in Naga- Calabanga is mainly that still covered by nipa shrubs while the undeveloped area in Rinconada is mainly occupied by coconut (322 ha) and swamp (114 ha) NIA needs to pursue with the farmers the matter of accelerated development of the areas occupied by nipa shrubs and coconut > Structure - Diversion Dams, Checkgates, ete 18. The design and construction of the three diversion dams (the Hinagyanan and Tigman diversion dams in Naga-Calabanga area, the Barit diversion dam in Rinconada area) and the San Francisco checkgate, were generally satisfactory except for spalling of surface concrete and poor fixing of metal work at the San Francisco checkgate. c. Main Canals 19 The main canals were originally designed and constructed as unlined canals. However, in late July 1987, NIA proposed to carry out lining of the canals with a view to increasing irrigation efficiency and minimizing future O&M problems and costs. The lining work was undertaken during the 1988 dry season. The PCR Mission noted no problems with the main canals in Naga- Calabanga area. However, in Rinconada area, the Mission noted that the main canals had silted up and required extensive cleaning. The Mission suggested that, in order to reduce siltation of the main canals, the exposed slopes above the canals should be stabilized with appropriate vegetation, before the next rainy season 4. Inverted siphons 20 The Mission also noted the extensive use of inverted siphons for the canals to cross drainage courses, These siphons are subject to rapid siltation, thus reducing the efficiency and effectiveness of the system as a whole. NIA will, therefore, need to have these siphons regularly inspected and cleared of silt to ensure the required hydraulic performance for achieving the desired irrigation efficiencye. Turnouts 21. The Mission noted that the turnout structures required improvements for better calibration and to assist water management. Such improvement could be achieved by using more robust metal work. 22. The Mission also noted a number of illicit turnouts from the main canal in the Naga-Calabanga area which were irrigating some 600 ha. It was reported that NIA intended to authorize some of these turnouts that are irrigating up to 100 ha, However, in order to maintain the integrity of the whole system, NIA should take the measures necessary to prevent construction of unauthorized or illicit turnouts. OF -01 Wo 23 ‘A comparison of the flood control works as actually constructed with those envisaged under the original and revised project scope is presented in Appendix 1. These flood control works include levees, drains, drainage/tidal control structures, sea wall and jetty for Naga-Calabanga area and Bank river channel improvement, Bicol river dredging, San Francisco creek channel improvement, and main drains in Rinconada area. Due to the problens discussed in the following paragraphs in connection with the levees and control structures, the flood control works for Naga-Calabanga area were still largely ineffective. Consequently, the areas provided with irrigation facilities were not yet adequately protected from flooding and salinity intrusion. In Rinconada area the main drain which links San Francisco creek with Bicol River was being extensively interfered with by the people and needs regular and intensive maintenance. The situation of the levees, control structures and sea wall in Naga-Calabanga area is discussed in the following paragraphs. a. Levees/Sea wall 2, It was noted that the 375 m long section of the levee at Sabang which was washed away during the Typhoon Yoling in November 1988, had not yet been restored. Besides, there is an opening in the levee system as the bypass channel at Sabang has not yet been closed (see para 26 below). A spot check of the top of the levees was carried out in connection with the currently ongoing study in respect of Bicol River Basin Flood Control and Trrigation Development Project under Bank's technical assistance 1/ and it was found that the levee top varied from 2.45 Mean Sea Level (MSL) to 4.0 MSL except for the section washed away at Sabang mentioned above. These levees, with the washed away section restored, could in general be expected to withstand a flood with a recurrence interval of five years. However, due to opening in the levee system most of the area continues to experience flooding, although the duration of flooding and depths of water during 1/ TA No. 1087-PHI: Bicol River Basin Flood Control and Irrigation Development Project, approved on 8 Deceuber 19887 flooding are less than they might have been without embankments. Typhoons of the intensity of Typhoon Yoling, which caused damage to the levee at Sabang, are estimated to recur at intervals of three years. Erosion of the crest occurred when overtopped. No sea-face revetment was provided to withstand the wave action. The Mission considers that in addition to the rehabilitation of the washed away section and closing of other openings in the levees system, the levees, to be effective, need to be raised and provided with adequate protection on the seaward face. The 360 m long portion of the sea wall destroyed during Typhoon Yoling also needs to be rehabilitated as soon as possible. b. Control Structures 25. With regard to the five drainage control structures (Sabang, Sabang Ilaud, Balongay, Ponong and Camaligan), which have been constructed to protect Naga-Calabanga area from floods and intrusion of sea water, the following problems have been noted: (4) heavy siltation downstream of the flap gates has rendered the gates inoperable; (ii) debris accumulation upstream of the flap gates has retarded the flow and effectively reduces the capacity of the structure; (iii) heavy corrosion of the gates with, in some cases, accumulation of barnacles; (iv) disalignment of the gates due to floating debris which makes them ineffective; (~) rubber sealings in some cases deformed or partly detached; (vi) the geometric alignment of the double hinges does not seem to be the best arrangements for maximizing gate opening with minimum hydraulic force; and (wit) there are no facilities for installing stoplogs. Hence, maintenance of gates and trashracks can only be carried out by building earthbunds in the drains. 26. The Sabang control structure when closed denies access to the channel/creek behind the structure which is being used by @ good number of fishing boats for docking and shelter during bad weather. For this reason the bypass channel has not yet been closed and, as such, the Sabang control structure remains ineffective. The Mission noted that the proposed measures, i.e. construction of cove and dock integrated with the control structure, are yet to be implemented 27. The sixth and last of the series of flood control structures planned for the Project (Canaman) remains to be constructed. The PCR Mission was informed that, due to the failure of the contractor to carry out the8 work, the contract had been terminated and DPWH was planning to execute the work by force account. It was noted that the Canaman channel was part of the drainage system of the area originally envisaged to be irrigated by the pumping scheme that had been deleted from the project scope (see para 8) Since this area is now proposed to be supplied by gravity under the Bicol Flood Control and Irrigation Development Project being planned under Bank's technical assistance 1/, the Mission suggested that further work on the structure need not proceed. 3. Agricultural Development a. Paddy Yields 28. Appendix 3 summarizes the cropped areas and the yields for Naga- Calabanga and Rinconada areas from 1981 to 1988. The rehabilitation works under the Project were not completed until 1984; the initial three years (1981-1983) of the series can, therefore, be considered as representing without project situation. The average yields for dry and wet seasons over these three years would work out as follows: Table 1: Average Yi a Season Waga-Calabanga Rinconada Total Ierig. Rainfed Irrig. _Rainfed _Irrig, Rainfed Dry Season 3.3 1.06 3.12 1.09 3.12 1.08 Wet Season 2.90 1.22 3.19 1.78 3.13 1.58 29 The data in Appendix 3 also indicates an average cropping intensity of 122 per cent during the three year period (1981-1983). 30. The decline in the yields in the latter years of the decade, as indicated by the table in Appendix 3, is attributed to particularly bad typhoons followed by disruption to the irrigation systems due to canal lining works 31. NIA‘s Five Year Agricultural Development Program (FYADP) for the Project area, prepared in 1987 pursuant to a requirement of the Loan Agreement (Schedule 6, para. 6), suggested an annual yield of 9.5 mt. Rinconada area achieved annual yields of 8.34 mt and 8.25 mt during the initial operations of the rehabilitated Barit irrigation systems while the demonstration farm has exceeded 9 mt. Naga-Calabanga was yet to achieve 7 me. In this connection, it should however be noted that the operations of the irrigation facilities were interrupted by canal lining work and the flood control and drainage works were not yet complete. In some parts of Naga- 1/ | TA No. 1087-PHI: Bicol River Basin Flood Control and Irrigation Development Project approved on & December 1988.9 Calabanga area where the drainage is adequate and the required irrigation water is available, farmers are reported to have achieved a dry season yield of 6 mt. This suggests that, with the improvement of flood control and drainage works as recommended ‘in above paragraphs, an annual yield of 9 mt should be achievable in Naga-Calabanga. An annual yield of 9.5 mt as projected in NIA’s Report should be achievable in Rinconada. b. Institutional Support 32. The Appraisal Report (AR) considered sociocultural factors as critical to the attainment of project benefits. The AR and Loan Agreement set out a wide range of sociocultural developments to provide institutional support for the project. This particularly relates to the period of the FYADP but is intended to provide permanent support so that the benefits are sustained. These factors are discussed in detail in Appendix 4 and are briefly reviewed in the following paragraphs (i) Agricultural Extension Services and Support 33. The Mission noted that two water management demonstration farms as envisaged at Appraisal had been established and have provided a base for training the farmers and establishing a level of crop yields with effective extension services and support. However, the operations of these farms ceased during the water supply disruptions caused by canal lining in 1988- 89. The Mission consider it necessary to reactivate the demonstration farms at the stage when large areas under the project are receiving irrigation water. 34 To support the increased cropping intensities and techniques required to achieve full benefits it was required 1/ that the number of farm management technicians should be increased to 115 to achieve the national standard for double cropped irrigated rice land, i.e., is one technician for evey 150 ha, and that the additional technicians should be in position before the agricultural development phase of the Project began. NIA’s PCR indicates that during 1989-90 one technician has been provided for 233 ha. NIA should rectify this deficiency. (11) Supply of Inputs 35, The Mission noted, that due to financial constraints, the farmers were unable to use "certified" seed purchased from the dealers. The farmers were also unable to use recommended fertilizer. (iii) Supply of Credit 36. Private lenders, charging high interest rates appear to be the main source of credit for agricultural inputs. The Mission noted that, until substantial improvements are made to the credit schemes, the farmers would remain unable to achieve the Project targets of production 1/_ Appraisal Report, para. 60, Loan Agreement, Schedule 6, para. 9.10 Gv) Land Tenure 37. The AR and Loan Agreement 1/ provided that the land reform program in the Project area will be completed by 31 December 1980. This meant that all those eligible for titles to the land should receive their titles and all share tenancies be converted to secure leases at fixed rents by the end of 1980. The Mission was informed that 22.5 per cent of the land was still covered by share tenancies. The matter needs to be brought to the attention of the Department of Agrarian Reforms (DAR) for action as soon as possible. (v) Hive Year Agricultural Development Program (FY 38 A comprehensive plan documents for FYADP (see para. 31) was issued by NIA in September 1987 covering the period 1988-1992 and a Memorandum of Agreement was signed between NIA and other participating agencies on 10 December 1987. Initial staff training for FYADP was scheduled to commence in late 1989. However, due to non-provision of funds by the agencies concerned the program of the scheduled activities have not yet been undertaken, The matter merits urgent attention if the targets set in FYADP are to be achieved. 5. Farm-to-Market Roads 39. The Mission noted that this component had been satisfactorily implemented. Appendix 1 provides the comparison between the actual accomplishment and the appraisal and revised targets 6. Wats r 40. The rural water supply works have been satisfactorily completed. Actual accomplishment compared to the appraisal and revised targets is presented in Appendix 1. Out of the forty samples tested, 11 have been found to be unfit for drinking while 29 have been found fit, The source of unfic samples need urgent attention 7 ‘osion Control and Soil Conservatior 4. The actual accomplishments under this component, compared to the appraisal and revised targets, are presented in Appendix 1. 42, The erosion control and soil conservation component of the Project provided for the implementation of a pilot scheme for about 1,800 ha in Lake Bato watershed area, The Project attempted to demonstrate to the farmers agto-forestry technology to ensure sustainable agricultural production in order to cure the sources of soil erosion rather than simply mitigate the effects. However, the Mission found that the agro-forestry scheme had failed to achieve the objectives. There was little evidence of the adoption of agro-forestry; the original four demonstration farms and nurseries handed 1/ Appraisal Report, para. 63, Loan Agreement, Schedule 6, para 8.un over to the farmer cooperators in 1985 had reverted to traditional upland farming (corn); the recently established demonstration farm was no longer functioning; no farmer cooperative for agro-forestry had been established. The Mission’ reconmended that DENR should take steps as soon as possible to Tehabilitate the original four demonstration farms and nurseries and reactivate the more recently completed demonstration farm. When adequately rehabilitated and reactivated, these farms should be handed over to the properly established farmer cooperatives. The necessary steps should also be taken to establish farmer cooperatives for agro-forestry. The above activities should be undertaken with the active participation of Department of Agriculture (DA). 43. The delineated watershed area under the project is privately owned land farmed by share tenants who, lacking security of tenure, have no incentive to construct terraces and to adopt agro-forestry practices. The Mission considers that the participation of the private land owners in watershed protection is essential if tangible results are to be achieved. Ideally, such participation should be on a voluntary basis, but consideration may have to be given to enacting legislation to ensure that duly specified watershed areas are properly protected. ab. The Mission was advised that no funds were available for operation and maintenance of this component, In view of the importance of this component the matter needs immediate attention of DENR and the Governnent for appropriate action, B. Project Costs 45 The actual cost of the Project amounted to 72.675 million compared with the original $82.70 million at appraisal (1979) and the revised $69.00 million (1987) based on modified scope mentioned in para 8 above. Details of the actual project cost are given in Appendix 5. Bank financing amounted to $46.432 million or 64 per cent of the actual total cost; EEC financing amounted to $4.574 million and the Government financed the balance of §21.669 million. The final cost of the irrigation component including agricultural development amounted to $45.255 million, equivalent to a unit development cost of $3,800 per ha. The costs of other components amounted to : (4) §17.755 million for flood control; (ii) $5.359 million for farn- to-narket roads; (iii) $3,063 million for rural water supply; and (iv) $1.25 million for erosion control and soil conservation. C. Project Implementation Schedule 46 It was envisaged at appraisal that the Project implementation would take five and a half years commencing in early 1980 and ending in the middle of 1985. The preparatory works and procurement of construction equipment were anticipated to start at the beginning of 1980 and be completed at the end of 1981 while the construction activities (civil works) were to commence in early 1981 and end in the middle of 1985. The actual implementation time for various activities is compared with the Appraisal Implementation Schedule in Appendix 612 47. The project implementation has already taken more than ten years and some of the flood control works are yet to be completed, The major causes of the delay are discussed in para. 13 which, to summarize, were: (i) longer time than originally anticipated was required for the preparation of detailed design and tender documents for civil works; (ii) right-of-way Problems encountered during project implementation; (iif) more frequent and longer work disruptions by typhoons than originally allowed for; and (iv) budgetary constraints experienced during 1983-1986. Evidently the implementation schedule drawn up at appraisal was too optimistic and did not include sufficient time allowance for the preparation of detailed design including tender documents and other impediments such as acquisition of right-of-way and interruptions by typhoons. D. jent_of Consultants and Procu: of Goods and Services 48 The Project provided for 78 man-months of expatriate consulting services involving 7 individual specialists: Irrigation/Drainage/ Construction Expert (24 man-months), Mechanical Engineer (4 man-months), Electrical Engineer (4 man-months), Design Engineer/Foundation Expert (8 man- months), and Hydrologist (8 man-months) for NIA; Flood Control/Drainage Expert (12 man-months) for DPWH and Watershed Management Specialist (18 man- months) for DENR. 49 Against the above provision, a total of 84 man-months of consulting services were actually utilized involving 6 individuals. One individual consultant instead of two were engaged for the positions of Mechanical and Electrical Engineers. The net excess of 6 man-months over the original provision was due to extension of services of Flood control expert by 10 man- months and Design Engineer by two months and reduction of the Irrigation/Construction Expert by six months. The consultants were engaged in accordance with the Bank Guide eof Consul 50. There were no notable problems in the procurement of construction materials, construction equipment and other goods, which was carried out by NIA, and other implementation agencies (DPWH and DENR) in accordance with the Bank's Guidelines on Pi nt. 51 A comparison of the construction equipment and vehicles proposed at appraisal, with the actual procurement is shown in Appendix 7. 52. As stated earlier (para 11) civil works were carried out through contracts or force account or through combination of contract and force account. ‘These contracts (see lists in Appendix 8) were awarded by NIA and other implementing agencies (DPWH and DENR) through local competitive bidding amongst prequalified contractors following standard Government procedures. formance of Consultants, Cont: suppliers 53. As reported by NIA, DPWH and DENR, the performance of Consultants was generally satisfactory. The performance of the civil works contractors, except in respect of the following contracts, has been generally satisfactory: (i) the contract for the construction of Right Main Gravity13 Canal B avarded in September 1983 with a completion date in February 1985, despite the extensions granted, could not be completed by the contractor even by August 1987 when the contract was finally rescinded. The remaining contract works were executed through force account by NIA and completed in November 1989; (ii) poor performance of the contractor combined with sone other factors beyond his control delayed the completion of Right Main Gravity Canal A; this contract was awarded in Septenber 1983 and the works were finally completed only in June 1988, an overrun of three years; (iii) the contract for construction of Balongay control structure was completed with a delay of more than three years; (iv) contracts for Sabang control structure and Ponong control structure were completed with a delay of 3 years and 2 years respectively. However all contract works, except for the construction 0f Canaan control structure for vhich a contract was awarded in February 1988, have been completed F. Compliance with Loan Covenants 54. The Borrower, the Executing Agency (NIA) and the implementation Agencies (DPWH and DENR) generally complied with the Loan covenants, with the exception of those relating to the following matters which have been only partially complied with: 1. Land Reform (LA, Schedule 6, para 8) 2. Farm management Technicians (LA, Schedule 6, para 9) 3. Agricultural Credit (LA, Schedule 6, para 5) 4. Agricultural Develo; (IA, Schedule 6, para 6) ‘The status of compliance with Loan covenants is set out in Appendix 9 C. Disbursements 59. The first disbursement under the principal loan was made in February 1981, By April 1983 when 57 per cent of the original loan period had elapsed the total disbursement was only 16 per cent of the total loan amount. First disbursement from the supplementary loan under the Bank's SAP approved in May 1983 was made in December 1983. By Decenber 1985, the original closing date for the principal loan, the disbursement under’ that Joan had reached only 45 per cent of the loan amount. The supplementary loan amount of $4.0 million was fully disbursed by September 1985 and on 5 October 1989, the date of the final closing of the Loan Account, the total amount disbursed under the principal loan was $39.653 million. The unutilized amount of $1.347 million was cancelled. Bank's SPIAL approved in april 1986 was closed on 7 Decenber 1987. By this date an anount of $2.78 million had been utilized for this Project. Thus finally the Bank financing for the Project stood at $46.432 million, Environne (pact 56 The overall environmental impact of the project is considered to be positive. The flood control works constructed under the project such as levees, tidal gates, diversion structures, drains are meant to protect the service area, especially the more vulnerable Naga-Calabanga area facing San