Strengthening Solid Waste Financing and Cost Recovery Framework in Syria. Terms of Reference for a Financial Analyst
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1 Strengthening Solid Waste Financing and Cost Recovery Framework in Syria Terms of Reference for a Financial Analyst BACKGROUND The present Terms of Reference cover the preparation of an analysis and recommendations for enhanced and effective cost recovery mechanism for municipal solid waste in Syria. Syria generated an estimated million tones of municipal solid waste in 2002, growing at an estimated percent per year. Municipal solid wastes have been inadequately managed for many years in the country. Waste collection systems have left large areas (up to 80 percent in some cases) of towns and cities that are not serviced or underserviced. The majority of collected waste dumped in facilities lacks any effective controls. Composting, although widespread, has generally not been effectively implemented; important recycling activities are undertaken in at least some cities (particularly Damascus). Hazardous wastes may be inappropriately managed with non-hazardous municipal wastes. Work has been undertaken in several of the major cities in Syria to develop waste management plans in support of either specific component of waste management systems or on MSW in general. Solid waste management plans have been developed for major cities such as Homs, Latakia, and Aleppo. In the absence of an overall policy identifying national objectives and priorities, this work has established project priorities without reference to a broader national agenda. Financing of waste management infrastructure is being undertaken through central government allocations, and international grant and loan initiatives. Waste management is not a government line item, and financing of capital and equipment is undertaken on an exception basis. Generally, a state planning commission reviews annual municipal infrastructure requests and allocates budget accordingly. In 2003, the Ministry of Local Administration and Environment initiated the elaboration of a national SW master plan. This master plan covered the whole chain of SWM except the collection and focus on transfer, processing and disposal facilities. It consisted of the collection of base data on municipal solid waste (input and output for each area), preparation of technical reports with needed technologies, equipment, required operation and maintenance (consumables, personnel, etc.), general layout plans, preliminary executions programs and projected costs for each facility. The technical reports are then to be used in tendering priority investment projects. The total investments for the next 10 years are estimated to USD 400 million. 1
2 The implementation of the above master plan will require great efforts for the mobilisation of financial resources for both investment and operating costs. It is reported that the cost of the planned municipal solid waste system will be around 420 SP/inhabitant/year or 10 times more the existing one. Therefore, strengthening the current solid waste cost recovery system is a must. The Ministry of Local Administration and Environment (MOLAE) recognized the urgent need for immediate action and established on June 22, 2004 a national working group to study cost recovery issues. The main tasks of this group include: (a) analysis of the current solid waste financing and cost recovery framework, (b) identification of alternatives and options for improvements, and (c) recommend the best option to ensure financial sustainability of the planned systems. Within this context the MoLE requested RMG assistance for the mobilisation of a short term consultant (financial analyst) in order to assist and guide the above national working group in carrying out its assigned tasks. OBJECTIVE OF THE MISSION The key objective of the present assignment is to assist the Government of Syria in strengthening the existing MSW financial and cost recover framework. More specifically, the consultants will assist the above national working group to develop and recommend appropriate cost recovery mechanisms including fees/tariff structures and cost recovery targets. The Consultant will rely principally upon readily available data. Original data collection will be furnished with the assistance of MOLAE and Damascus Municipality. Other involved parties (members of the working group) will also provide and arrange access to appropriate records and reports as necessary for the mission. KEY TASKS OF THE CONSULTANT The consultant will start its assignment by carrying out a short mission (7 days) in Damascus Syria to (a) discuss and validate the scope of the work with the MoLAE and the National Working Group; (b) collect and complement relevant data and information; and (c) discuss wit key stakeholders options and alternatives identified. More details on key tasks are as follow: Task 1: Cost analysis of MSW services The working group will collect available data on operating and investment costs of the existing SWM services including those provided through the private sector on the basis of a list prepared by the consultant 2
3 The consultant will analyse those data The consultant will conduct a comprehensive cost analysis of the current municipal solid waste collection, transport, treatment and disposal services; The consultant will prepare projections of operating and maintenance (O&M) costs for the next 10 years of operation of the whole MSW system including existing and proposed new services and facilities under the prepared Master Plan. The working group will conduct a market assessment on the achievements and potentialities of recycling and composting activities in Syria. On the basis of these data, the consultant will identify potential sources of revenues and evaluation of possible financial inputs of waste recovery and recycling activities as well as potential composting activities. Task 2: Assessment of current institutional responsibilities for financing MSW and current revenue levels for MSW With the support and the backing of the National working group, the consultant will: Assess the existing financial management responsibilities for the solid waste sector by the various institutions in Syria Analysis; Identify key national sources of finance for waste management investments including government budget transfers, international sources, municipal funds, etc.; Identify and evaluate national and/or municipal fiscal/legal instruments for MSW indirect sources of revenues (ex: Property taxes, etc.); Estimate the potential revenues based on the current fees/taxes recovery systems and relevant collection rate; and Estimate the current and future gaps between revenues and costs estimated under Task 1 and prepare a cash flow analysis including forecasts of revenues and expenditures associated to SWM services for 10 and 15 year Horizons; Task 3: Development of MSW new cost recovery options The working group, with the backing of the consultant, will: Based on the above and other factors deemed relevant by the consultants will develop possible alternatives for cost recovery in Syria; analyze the feasibility of the above alternatives, and determine the phasing-in schedule to move from partial to full cost recovery; describe the pros and cons for each alternative, estimate the cost to each household for each alternative cost recovery mechanisms. These 3
4 proposals should take into consideration current legal and institutional framework and above developed finding resources alternatives. Based on the above development, the consultants will recommend the most appropriate cost recovery scheme to the Syrian context and draft a detailed schedule of associated rates. Task 4: Implementation Plan In close coordination with the National Working Group members, the consultants will identify the steps, decisions and actions needed to implement the various recommendations of the present assignment. EXPECTED OUTPUT REPORTS Deliverable #1 Draft Report: It shall be submitted to the MOLAE within the time schedule set out below. The core of the Draft Report will be the results of all tasks. The Draft Report should be prepared in English. The MOLAE will have 2 weeks to review and comment on the Draft Report. Deliverable #2 - Final Report. The Final Report shall be submitted to the the MOLAE within the time schedule set out below. The Final Report will provide complete details of all work performed, analyses made and justification of options and recommendations proposed. The Final Report should have an Executive Summary prepared in Arabic, and a Main Report prepared in English. ASSAIGNMENT SUPERVISION & TIME SCHEDULE The work of the Consultant would be supervised by the MoLAE in close coordination with RMG/ANPE. The Department of SWM among the MoLAE will be the focal point for coordination with all other ministries, agencies and any other member of the National Working Group. The MoLAE will assure free access to all existing data and to all relevant operations and facilities. The Client will also provide liaison and contacts with the local authorities and other key stakeholders. The following is the time schedule for the production of the reports described above. MILESTONE WEEKS TO COMPLETION 1. Contract signature 0 2. Submit Draft report 4 3. Comments issued by Client 6 5. Submit Final Report 8 4
5 LEVEL OF EFFORT & TIME FRAME: It is proposed that the Consultant will avail a total of 34 person-days for the completion of this assignment. It is anticipated that the Consultant would complete the work over a duration of maximum 2 months [February 2005] until [Marsh, 2005], including review time of reports. QUALIFICATION OF THE CONSULTANT The required qualification of the consultant should be as follow: Financial analyst or economist with over 10 years of related experience, Very well familiar and thorough knowledge of solid waste issues Fluency in Arabic and English required with excellent written and oral communications skills. BUDGET The budget of the proposed assignment is estimated to a total of 8500 euros (34@250 euros/day). The perdiem and travel cost related to country visit will be reimbursed 5
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