Document of The World Bank

FOR OFFICIAL USE ONLY

Report No: RES20156

RESTRUCTURING PAPER

ON A

PROPOSED PROJECT RESTRUCTURING

OF

ADAPTATION OF WATER SUPPLIES TO CLIMATE CHANGE PROJECT

GRANT FROM THE SPECIAL CLIMATE CHANGE FUND (SCCF) GRANT TF013410

APPROVED ON NOVEMBER 13, 2012

TO THE

REPUBLIC OF NICARAGUA

MAY 27, 2016

Environment & Natural Resources Global Practice Latin America and Caribbean Region

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

2

ABBREVIATIONS AND ACRONYMS

ANA National Water Authority (Autoridad Nacional de Agua) CAPS CES

Water and Sanitation Committee (Comité de Agua Potable y Saneamiento) Compensation for Environmental Services

FISE New Emergency Social Investment Fund (Fondo de Inversión Social de Emergencia) FONADEFO National Forestry Development Fund (Fondo Nacional de Desarrollo Forestal) GEF Global Environment Facility INETER Nicaraguan Institute for Territorial Studies (Instituto Nicaragüense de Estudios

Territoriales) IRI MARENA MTR OM PDO PMPAFCC

Intermediate Results Indicator Ministry of Environment and Natural Resources (Ministerio del Ambiente y los Recursos Naturales) Mid-Term Review Operational Manual Project Development Objective Municipal Plan for Environmental Protection in face of Climate Change (Plan Municipal de Protección Ambiental de las Familias ante el Cambio Climático)

RF Results Framework SCCF Special Climate Change Fund SiAGUA W&S WSH

National Water Resources Information System (Sistema de Información Nacional de los Recursos Hídricos) Water and Sanitation Water, Sanitation and Hygiene

Regional Vice President: Jorge Familiar Country Director: J. Humberto Lopez

Senior Global Practice Director: Paula Caballero Practice Manager: Raúl Alfaro-Pelico Task Team Leader: Tuuli Johanna Bernardini

3

NICARAGUA Adaptation of Water Supplies to Climate Change Project

CONTENTS

A. SUMMARY 5 B. PROJECT STATUS 6 C. PROPOSED CHANGES 7 D. APPRAISAL SUMMARY 17 ANNEX 1: REVISED RESULTS FRAMEWORK 19

4

DATA SHEETNicaragua

Adaptation of Water Supplies to Climate Change (P127088) LATIN AMERICA AND CARIBBEAN

Environment & Natural Resources .

Report No: RES20156 .

Basic Information

Project ID: P127088 Lending Instrument: Investment Project Financing Regional Vice President: Jorge Familiar Original EA Category: Partial Assessment (B) Country Director: J. Humberto Lopez Current EA Category: Partial Assessment (B) Senior Global Practice Director: Paula Caballero Original Approval Date: 13-Nov-2012

Practice Manager/Manager: Raúl Alfaro-Pelico Current Closing Date: 30-Jun-2018

Team Leader(s): Tuuli Bernardini .

Recipient: Republic of Nicaragua

Responsible Agency: Emergency Social Investment Fund (FISE), Ministry of Environment and Natural Resources (MARENA) .

Restructuring Type Form Type: Full Restructuring Paper Decision

Authority: Board/AOB Decision

Restructuring Level: Level 1 .

Financing (as of 11-May-2016)Key Dates

Project Ln/Cr/TF Status Approval Date Signing Date Effectiveness Date Original Closing Date

Revised Closing Date

P127088 TF-13410 Effective 04-Dec-2012 04-Dec-2012 29-Jan-2013 30-Jun-2018 30-Jun-2018

Disbursements (in Millions)

Project TF Status Currency Original Revised Cancelled Disbursed Un-disbursed % Disbursed

P127088 TF-13410 Effective USD 6.00 6.00 0.00 2.64 3.36 46.

Policy Waivers Does the project depart from the CAS/CPF in content or in other significant respects? Yes [ ] No [ X ]

5

Does the project require any policy waiver(s)? Yes [ ] No [ X ] .

A. Summary of Proposed Changes

This Restructuring Paper seeks the approval of the Executive Directors to adjust the formulation of the Project Development Objective (PDO)1 to improve its measurability and clarify that the Project was designed as a pilot by its nature and scale. The following modifications will also be part of the proposed Restructuring: (i) revision of the results framework (RF) in line with the new PDO to improve the indicators’ relevance to the PDO and the measurability of the overall project performance, including revision of some of the targets; (ii) addition ofthe National Forestry Development Fund (FONADEFO) and the Nicaraguan Institute for Territorial Studies (INETER) as cooperating agencies in the Project institutional arrangements to delegate FONADEFO the responsibility of external field monitoring and respective payment delivery under Subcomponent 1.2 on thepilot program for Compensation for Environmental Services (CES), and INETER to provide technical guidanceand collaborate on preparing an environmentally focused territorial plan with climate change considerations for the municipality of Corn Island under Component 2; (iii) adjustment of the budget allocations per subcomponent and across disbursement categories to address specific budgetary prioritization of the Project activities and include works as an eligible expenditure category under Subcomponent 3.1; and (iv) revision ofthe estimated disbursements until the Project closure.

The changes proposed are based on a request from the Government of Nicaragua and reflect the related discussions and agreements reached between the Bank and the Project counterparts over the last few months.

Change in Implementing Agency Yes [ ] No [ X ]

Change in Project's Project Development Objectives Yes [ X ] No [ ]

Change in Results Framework Yes [ X ] No [ ]

Change in Safeguard Policies Triggered Yes [ ] No [ X ]

Change of EA category Yes [ ] No [ X ]

Other Changes to Safeguards Yes [ ] No [ X ]

Change in Legal Covenants Yes [ X ] No [ ]

Change in Grant Closing Date(s) Yes [ ] No [ X ]

Cancellations Proposed Yes [ ] No [ X ]

Change to Financing Plan Yes [ ] No [ X ]

Change in Disbursement Arrangements Yes [ ] No [ X ]

Reallocation between Disbursement Categories Yes [ X ] No [ ]

Change in Disbursement Estimates Yes [ X ] No [ ]

Change to Components and Cost Yes [ X ] No [ ]

Change in Institutional Arrangements Yes [ X ] No [ ]

Change in Financial Management Yes [ X ] No [ ]

Change in Procurement Yes [ ] No [ X ]

Change in Implementation Schedule Yes [ ] No [ X ]

Other Change(s) Yes [ ] No [ X ]

1 Projects financed by the GEF no longer apply the concept of “Global Environment Objective (GEO)”, but are streamlined with the World Bank standard of using “PDO”.

6

Appraisal Summary Change in Economic and Financial Analysis Yes [ X ] No [ ]

Appraisal Summary Change in Technical Analysis Yes [ ] No [ X ]

Appraisal Summary Change in Social Analysis Yes [ ] No [ X ]

Appraisal Summary Change in Environmental Analysis Yes [ ] No [ X ]

Appraisal Summary Change in Risk Assessment Yes [ ] No [ X ] .

B. Project Status Implementation Progress: The Adaptation of Water Supplies to Climate Change Project (Global Environment Facility, GEF-Special Climate Chance Fund, SCCF Grant of USD 6 million, P127088) is expected to achieve its objectives as reformulated in the proposed new PDO that clarifies the Project nature and scale as a pilot on innovative approaches to improve resilience of safe drinking water supply in climate vulnerable communities in a diverse set of pilot municipalities. The first two years of implementation were marked with low disbursement while enabling actions were conducted to proceed with the planned investments. A mid-term review (MTR) mission was conducted in July, 2015, implying a thorough review of the Project status and priority actions and carrying out of related budget planning for the remaining implementation period. The MTR also served to reconfirm the commitment of and strengthen collaboration between the participating Government agencies. After the MTR, the Project implementation has advanced particularly through completion of two technical studies that allow the subsequent design and construction of integrated water, sanitation and hygiene (WSH) works in the municipalities of Murra, San Juan de Limay and San Ramón in one hand, and the decision on the use of the funding reserved for drinking water related investments on Corn Islands on the other. Further, the design of the first pilot project on integrated WSH works in the municipality of Juigalpa that already counted with a study on water resources availability, and of the three other pilot municipalities are expected to finalize by the end of 2016. Most of the WSH works will be constructed during 2017. Under Component 1 the CES program in the municipalities of Murra, San Juan de Limay, San Ramón and Juigalpa is fully operational but urgently requires the approval of the proposed restructuring as to allow toproceed with the first external field monitoring and the subsequent results-based payments: (i) the baseline information has been collected on the included land plots of almost 280 participating farmers who have received their initial payments and count with continuous training and technical assistance by the Ministry of Environment and Natural Resources (MARENA), the lead executing agency; (ii) the control group has been selected and the respective information collected and MARENA is completing a survey among the non-participating farmers; and (iii) the first external field monitoring of the CES program will commence immediately after the Project Restructuring that includes FONADEFO in the Project’s institutional arrangements. Under Component 2 on Corn Islands, Project activities that promote wetlands conservation and rehabilitation as a means of safeguarding drinking water supply are advanced and the Project is preparing for new activities to further strengthen the results, including monitoring of the conducted red mangrove reforestation as a climate adaptation measure. Two environmental monitoring stations have been launched and are operating in Big Corn Island in coordination with INETER to monitor temperature, precipitation and sea level. Construction of a breakwater enlargement counts with the necessary environmental permission and MARENA is preparing the procurement of a consulting service to verify the feasibility of the required civil works within the limited budget allocation for the same. Under Component 3 regarding institutional strengthening, four Municipal Plans for Environmental Protection

7

in face of Climate Change (PMPAFCC) have been completed and adopted in the municipalities of Murra, San Juan de Limay, Juigalpa and San Ramón, and the Project personnel provides the municipalities technical assistance to support their implementation. Further, the Project has trained almost 100 environmental educators in the five beneficiary municipalities to build consciousness and capacity to sustain and replicate Project results. The Project will complete development of a Climate Change Information Module in SiAGUA, the National Water Resources Information System administered by the National Water Authority (ANA), a beneficiary and collaborative agency of the Project during the third quarter of 2016. MARENA and the Emergency Social Investment Fund (FISE), the two Project executing agencies, remaincommitted to the Project and it is expected that the Project will provide both agencies with valuable pilot experience and know-how on integrating climate change considerations in their related broader work agendas. The grant disbursement rate reached 46% in May 2016. Disbursements will start to increase more steadily as the results-based CES payments begin during the second half of 2016, and the climate resilient WSH worksstart implementation latest in early 2017. The progress towards achievement of PDO is currently rated 'Moderately Unsatisfactory' pending the proposed restructuring that will allow for a revised PDO to adequately reflect the original Project scope and activities as a pilot, and a RF that will better measure related results and Project achievements. The Project is expected to achieve its objectives as reformulated in the proposed new PDO that captures the Project scale on piloting innovative approaches to improve resilience of safe drinking water supply in climate vulnerable communities. The Overall Implementation Progress is also rated 'Moderately Unsatisfactory' in line with the PDO rating. All key activities are advancing but overall with a slower than optimal pace and the original indicators show low achievement of the targets. It is to be noted that the belated target values of the PDO indicators do not capture the following key progress that has taken place to achieve the expected Project objectives: 1) the critical studies to design the WSH infrastructure for the prioritized climate vulnerable communities have been completed; 2) the pilot Compensation for Environmental Services (CES) program is being implemented on the ground with almost 280 participants/beneficiaries; and 3) a number of tools have been prepared and are being tested or are under elaboration to pilot new approaches to integrate climate change adaptation in rural water supply. Social and environmental safeguards. The Environmental and Social Management Framework (ESMF) has been implemented in a satisfactory manner and does not require adjustments. Overall implementation risk is rated Moderate. The main risks currently faced by the Project are due to slow administrative processes at times and insufficient technical and financial capacity: the Project represents a technically and financially ambitious pilot to develop more climate resilient and integrated water supply infrastructure and management systems; an area where concrete field experience amongst companies in the sector and the participating agencies is still very limited. To address the technical limitations, in mid-April 2016 and in collaboration with the Project, FISE contracted its first Climate Change Specialist through the Bank-financed Nicaragua Sustainable Rural Water Supply and Sanitation Sector Project (PROSASR, P147006). The Project also organizes workshops and training on the importance of integrating climate change considerations in the project cycle of water and sanitation works to strengthen the capacity of the staff of the participating agencies and other stakeholder groups, such as the involved community leaders and companies and individual consultants that provide services to FISE. Further, work is ongoing to review and update relatedkey technical instruments and tools as reflected in Table 2 of Annex 1 of the proposed Restructuring Paper. .

C. Proposed Changes .

Development Objectives/ResultsProject Development Objectives Original PDO

8

The Development Objective of the Project is to enhance climate resilience of investments made in Nicaragua’s rural water supply sector in order to cope with: (i) increasing climate variability; (ii) expected adverse impacts of climate change in selected areas.

Change in Project's Development Objectives Explanation The new PDO reflects the pilot-scale nature of the Project that finances a number of diverse climate adaptation measures and supporting activities in the selected communities with differing socio-environmental conditions and in close collaboration with the beneficiary communities. The pilot approach entails development, testing and improving methodologies and tools to enhance climate resilience of rural water and sanitation (W&S)services to provide experience and lessons learned for future scale-up opportunities by the responsible public agencies in Nicaragua.

Proposed New PDO To pilot water resources protection and drinking water supply systems with an integrated and participatory approach in selected climate vulnerable communities in Nicaragua. The word “integrated” refers both to packages of WSH works, as well as combining said works with measures aimed at water resources conservation and protection. The latter entails reforestation of micro-watersheds and surroundings of water sources and wells, including environmental education and conscious raising on climate change impacts and related resilience measures. The whole aims at reliable provision of safe drinking water in terms of continuity, quantity and quality, considering the specific social and environmental conditions of each community. Further, the word “participatory” refers to the participants of the CES program and the social work that FISE combines to all of its infrastructure works on rural WSH. Public participation is a key Project feature also in terms of the Project-financed PMPAFCCs, wetlands conservation measures on Corn Islands, and training and supporting the work of voluntary environmental promotors.

Change in Results Framework Explanation: The RF will be adjusted to improve its overall presentation and consistency, the logical results chain between the revised PDO formulation and the PDO and intermediate results indicators, and the measurability of the Project results, and to include the applicable World Bank core sector indicators. Further, the targets related with the WSH works will be revised due to updated cost information (see Appraisal Summary, Change in Economic and Financial Analysis). The proposed changes are presented in detail in the following table:

Original PDO Revision Rationale To enhance climate resilience of investments made in Nicaragua’s rural water supply sector in order to cope with: (i) increasing climate variability; (ii) expected adverse impacts of climate change in selected areas.

New: ‘to pilot water resources protection and drinking water supply systems with an integrated and participatory approach in selected climate vulnerable communities in Nicaragua’

The PDO will be revised to clarify the Project’s pilot nature since its original design, innovative (integrated and participatory) approach, target scale (selected communities), and goal (protecting water resources and improving water supply in face of climate change). The drinking water supply systems to be constructed are not claimed to be climate resilient as related evidence cannot be collected and presented adequately by Project closure.

Original PDO indicators

Revisions Rationale

9

New: ‘Integrated and participatory pilot investment projects completed in selected climate-vulnerable communities (Number)’

The indicator has been added to measure the Project performance in terms of completing fully delivered ‘integrated and participatory pilot investments’ on rural drinking water supply systems that combine sanitation and hygiene and integrate climate considerations in their planning, design and construction. The unit of measure is the number of completed pilot works that combine the related technical tools completed by MARENA and FISE to facilitate replication and scale-up; tools measured by the new intermediate results indicator (IRI) 3.3.

Improved climate change adaptation capacity of rural water supply and sanitation infrastructure of the beneficiary communities in pilot areas (Number)

Revised: ‘People in rural areas provided with access to Improved Water Sources under the project (Number)’ Further, the target number is revised from 4,500 to 1,329 people, as reasoned under Appraisal Summary, Change in Economic and Financial Analysis.

The wording of the indicator has been revised by a World Bank core sector indicator on water supply. The original indicator measured the number of individual beneficiaries with access to new or rehabilitated water supply and implied ability to evidence the improved climate change adaptation capacity. With the new indicator, “improved climate change adaptation capacity” will be measured through the number of people that gain access to “improved water resources” provided through the Project that bases infrastructure planning, design and construction on technical studies that consider and address projected climate impacts.

Adoption of land uses that improve resilience to climate change in areas that provide water supply to rural communities (Percentage)

Revised: ‘Water Source Protection Index in water recharge areas of selected climate-vulnerable communities that benefit of a Compensation for Environmental Services (CES) program supported by the project, disaggregated by municipality (Number)’ Further, the result is now expressed in terms of the Index value instead of percentage.

The wording of the indicator has been revised to clarify the measured target; score of the Water Source Protection Index that measures the applied land use benefit to downstream communities as a result of the Subcomponent 1.2 on the CES program. The Index is defined in detail in the program´s Manual of Technical and Administrative Procedures.

Climate change adaptation mainstreamed in rural water supply sector’s development frameworks, policies and investment tools

Revised and moved to IRI level: ‘Tools to incorporate climate change adaptation in water and sanitation investments developed by MARENA and FISE (Number)’

The wording of the indicator has been revised to make it simpler and clearer. The tools include technical guides to incorporate climate change adaptation to integrated design in the water supply sector at both national and municipal level. The tools to be developed are defined and can be found in Annex 1 of the proposed Restructuring Paper. Also, the unit of measurement has been changed

10

in Nicaragua at the national level (Percentage)

from percentage to number of tools developed to make the measurement clearer.

New: Direct project beneficiaries (Number), of which female (%)

This World Bank core indicator has been monitored as part of the Project’s RF, but thus far it was not made official through restructuring. The proposed Restructuring adopts the core indicator officially at the PDO level as per the standard use of the same.

Original intermediate results indicators – Component 1 1.1 Communities

directly benefiting from the infrastructure investment component of the pilot projects in the selected areas, reducing human vulnerability to climate change (Number)

Dropped as replaced by the following World Bank core sector indicator: ‘Improved community water points constructed or rehabilitated under the project’

The original indicator has been replaced by the World Bank core sector indicator that has been monitored as part of the Project’s RF, but thus far it was not made official through restructuring. The proposed Restructuring adopts this indicator officially.

New: Improved community water points constructed or rehabilitated under the project (Number)

Thus far this World Bank core sector indicator did not form a part of the Project’s official RF, yet it had been monitored as a PDO indicator. The proposed restructuring adopts the core indicator officially as an IRI given it is an output indicator.

1.2 Communities directly benefiting from Compensation for Environmental Services (CES) component of the pilot projects within the project area (Percentage)

Revised: ‘Drinking water sources with climate adaptation measures in their recharge areas (Number)’

The indicator has been revised to measure the number of water sources (36 wells and 20 rivers) that will be improved through the sustainable land uses promoted by Subcomponent 1.2, to allow aggregation of the Project results to an indicator of the National Human Development Plan 2013–2017.

1.3 Women’s participation in the Compensation for Environmental

Dropped This indicator has been dropped as the core indicator on direct project beneficiaries at the PDO level will capture the sex disaggregation.

11

Services (CES) component of the pilot projects within the project area (Percentage)

Original intermediate results indicators – Component 2 2.1 Improve

protection of wetlands and water sources included in the program of water sources management to reduce vulnerability to climate change and sea level rise (Percentage)

Revised: ‘Index of wetland protection measures implemented by the project to improve adaptation capacity of water supply on Corn Islands (Percent)’

This indicator has been revised to measure the progress of five key Project activities to protect the 27 wetlands of the two Corn Islands. The methodological description of the indicator is presented in Annex 1 of the proposed Restructuring Paper.

2.2 Establishment of a Climate (Rainfall) Monitoring System in Corn Islands and implementation of a climate change education program (Yes/No)

Revised: ‘Environmental and climatic monitoring stations established and functioning on Corn Island (Number)’

The indicator has been revised firstly to remove the latter part “implementation of a climate change education program” since these are two separate activities. The Project will continue monitoring the total number of people participating in different types of awareness raising and educational events organized by the Project, disaggregated by gender, at the level of the Operational Manual (OM). Further, wording has been added to specify that the indicator will count the number of functional monitoring stations.

Intermediate results indicators – Component 3 3.1 Climate Change

Information Module in operation within the National Water Resources Information System (Yes/No)

Revised: ‘Climate Information Module for water and climate change developed and integrated in the National Water Resources Information System (SiAGUA) (Yes/No)’

The revision of the wording of the indicator is minor and has been made to only reflect the aspects that are related to the Project performance. In early May, 2016, SiAGUA has not yet been launched for use by the general public, so the words “in operation” are removed for precautionary purposes. Further, the target year of achievement is revised to reflect the slower than originally expected progress status of the related Subcomponent 3.1.

3.2 ‘Strengthen capacity to use the National Water Resources Information

Revised: ‘Technicians of key public institutions trained in the area of water resources and climate change (Number),

The indicator has been revised as the original wording is that of an outcome, not an indicator.

12

System (Number)’

percentage of which female’

3.3 Education and training programs on climate change and adaptation are formulated and under implementation (Number)

Dropped This indicator has been dropped as the revised IRI 3.2 captures the key Project result in terms of education and training. In every case, the Project will continue monitoring the total number of people participating in different types of events organized by the Project, disaggregated by gender. The actual result of this indicator is high as the respective monitoring has covered all the participants in a variety of diverse awareness raising and educational events.

Further, the MTR process supported the definition and integration of a social engagement and participation indicator that the Project will track led by FISE at the level of the OM. The indicator will pilot measuring of Project results on the necessary behavioral changes among the communities that will benefit of the more climate resilient WSH works. Other additional indicators were included at the OM level to reflect the Project-relevant results that contribute to the Special Climate Change Fund (SCCF) tracking tool. Annex 1 of the proposed Restructuring Paper presents the full revised RF, including methodological descriptions and the SCCF tracking tool with the Project MTR stage results (Table 3). .

Change in Legal Covenants Explanation: FONADEFO will be added as a cooperating agency in the Project institutional arrangements to delegate the responsibility of field monitoring and payment delivery under Subcomponent 1.2 on the CES program. INETER will also be added as a cooperating agency in the Project institutional arrangements to collaborate in and provide technical guidance on preparing an environmentally focused territorial plan with climate change considerations for the municipality of Corn Island under Component 2. The arrangements are reflected in the proposed Amendment to the Grant Agreement.

Ln/Cr/TF Grant Agreement Reference

Description of Covenant

Date Due Status Recurrent Frequency Action

TF-13410 Article V, item 5.01 (a)

This Agreement shall not become effective until evidence satisfactory to the World Bank has been furnished that the conditions specified below have been satisfied. (a) The execution and delivery of this Agreement on behalf of the Recipient has been

Complied with

No Change

13

duly authorized or ratified by all necessary governmental and corporate action; and | Due Date: 04-Dec-2012

TF-13410 Article V, item 5.01 (b)

(b) The Subsidiary Agreement has been duly authorized by the Recipient, through MARENA, and FISE and is legally binding upon the Recipient and FISE in accordance with its terms. | Due Date: 01-Mar-2013

Complied with

No Change

TF-13410 Schedule 2, Section 1, Part B, item 1

To facilitate the carrying out of the Project activities referred to in Section 2.01 (b) of this Agreement, the Recipient shall make a portion of the proceeds of the Grant available to FISE under a subsidiary agreement (Subsidiary Agreement) to be entered into between the Recipient and FISE, under terms and conditions acceptable to the World Bank. | Due Date: 29-Mar-2013

Complied with

No Change

TF-13410 Schedule 2, Section 1, Part F, item 1

The Recipient shall, and shall cause FISE to carry out the Project in accordance with the provisions of the Environmental and Social Management Framework and the Indigenous Peoples' Planning Framework. | Frequency: Yearly

Complied with

No Change

TF-13410 Schedule 2, Section 1, Part F, item 4

Without limitation to the provisions of Section F.3 of this Schedule, upon the definition of the works in the wetland area "Swamp Coe" under Parts 2.1 and 2.2 of the

Complied with

No Change

14

Project and prior to the carrying out of any works in said area, the Recipient, through MARENA, shall [...] and shall cause FISE to [...] carry out the RAP in accordance with its terms, and in a manner acceptable to the World Bank. | Frequency: Yearly

TF-13410 Schedule 2, Section I, Part G

To facilitate the carrying out of Project activities under Part 1.2. of the Project, the Recipient, through MARENA, shall enter into an agreement with FONADEFO (Cooperation Agreement), under terms and conditions acceptable to the World Bank.

Complied with

Continuous New

TF-13410 Schedule 2, Section I, Part H

To facilitate the carrying out of Project activities on Corn Islands under Part 2.1. and 2.2. of the Project, the Recipient, through MARENA, shall enter into an agreement with FISE, ANA and INETER (INETER Cooperation Agreement), under terms and conditions acceptable to the World Bank, and further detailed in the Operational Manual.

Not yet due

Continuous New

.

FinancingReallocations Explanation:

Budget allocations will be slightly adjusted between disbursement categories to address specific budgetary prioritization of the Project activities.

15

Ln/Cr/TF Currency Current Category of Expenditure Allocation Disbursement % (Type Total)

Current Proposed Current Proposed

TF-13410 USD

Goods, Works, Training,Consultants’ Services and Operating Costs FISE Part 1.1

1,600,000.00 1,779,096.00 100.00 100.00

Goods, Works, Training,Consultants’ Services and Operating Costs MARENA Part 1.2

2,000,000.00 1,831,113.00 100.00 100.00

Goods, Works, Training,Consultants’ Services and Operating Costs FISE Part 2.2

450,000.00 375,577.00 100.00 100.00

Goods, Works, Training,Consultants’ Services and Operating Costs MARENA Part 2.1

450,000.00 450,000.00 100.00 100.00

Goods, Training, Consultants’ Services and Operating Costs FISE Part 3.1, 3.2

600,000.00 526,788.00 100.00 100.00

Goods, Training, Consultants’ Services and Operating Costs MARENA Part 3.2

500,000.00 595,350.00 100.00 100.00

Goods, Training, Consultants’ Services and Operating Costs FISE Part 3.3

185,000.00 193,400.00 100.00 100.00

Goods, Training, Consultants’ Services and Operating Costs MARENA Part 3.3

215,000.00 248,676.00 100.00 100.00

Designated Account 0.00 0.00 0.00 0.00 Total: 6,000,000.00 6,000,000.00 Disbursement Estimates Change in Disbursement Estimates Explanation:

The disbursement estimates will be changed to reflect actual disbursements to date that proved slower than anticipated during Project preparation. The delays were mainly due to the time required to conduct initial vulnerability studies to prioritize the communities to benefit from W&S works that are planned and designed to be more climate resilient than the standard sector works. Delays were also encountered in the procurement

16

of two technical studies necessary to assess the availability of water resources and related vulnerability in 12 prioritized climate vulnerable communities in the three municipalities of Murra, San Ramón and San Juan de Limay and the hydrology and hydrogeology on Corn Islands. The proposed disbursement projections are based on the best estimates reached with the two implementing agencies in February, 2016.

Fiscal Year Current (USD) Proposed (USD) 2013 777,974.26 777,974.26

2014 485,296.12 485,296.12

2015 555,596.68 555,596.68

2016 1,581,132.94 1,269,094.87

2017 1,300,000.00 1,657,412.77

2018 1,300,000.00 1,254,625.30

Total 6,000,000.00 6,000,000.00.

ComponentsChange to Components and Cost Explanation: The (sub) component costs will be revised slightly to reflect cost changes and the budgeting priorities based on a detailed budget analysis conducted during the Project's MTR.

Current Component Name

Proposed Component Name

Current Cost (US$M)

Proposed Cost (US$M)

Action

1. Pilot adaptation initiatives to enhance climate resilience in the selected municipalities

3.60 3.60 Revised2

2. Coast wetland protection and reduction of vulnerability to sea level rise in the municipality of Corn Island

0.90 0.83 Revised

3. Institutional strengthening, project management and monitoring

1.50 1.57 Revised

Total: 6.00 6.00 .

Other Change(s)Change in Institutional Arrangements Explanation:

FONADEFO will be included as a cooperating agency in charge of the external field monitoring and related

2 The revision of this amount is so minor that it does not show in the rounded figure.

17

payment delivery under the CES program/Subcomponent 1.2. FONADEFO will not perform any Project-financed procurement, but it will manage Project funds. The first external field monitoring of the CES program will verify the first year results of the land use changes introduced by the participating farmers in the targeted micro-watersheds. The original Project design contemplated hiring of a firm or a university to conduct the external CES program monitoring. However, FONADEFO being the mandated national entity that already works on similar programs, MARENA requested adjustment of the original plan to task FONADEFO the external field monitoring and related payment delivery both for institutional strengthening and continuity purposes, as well as for minor implied cost. FONADEFO has the required technical and administrative capacityand MARENA recently finalized contracting of additional field consultants that are being trained to support FONADEFO in the field monitoring. Further, MARENA is finalizing procurement of minor equipment needed for the same. The FONADEFO Cooperation Agreement has been signed between MARENA and FONADEFO; FONADEFO is able to initiate the field monitoring right after this proposed restructuring becomes effective. Under Component 2, INETER will be included as a cooperating agency to collaborate in and provide technical guidance to MARENA, FISE and ANA on preparing an environmentally focused territorial planning that integrates climate change considerations on Corn Islands. INETER will not perform any Project-financed procurement nor manage Project funds, but the Project will cover eligible operational costs incurred by INETER staff in conducting Project-related tasks on Corn Islands. The relevant section of the OM will reflect these institutional arrangements in further detail. The signing of the INETER Cooperation Agreement is expected to take place during the second half of 2016.

Change in Financial Management Explanation: MARENA will transfer FONADEFO the funds needed to pay the farmers that participate in the CES program,based on their respective results of the yearly field monitoring. Thus, disbursements under subcomponent 1.2 will be made after field verification of results by the farmers on aspired land use changes and based on the respective compensation amounts. The World Bank assessed the fiduciary capacities of FONADEFO in November 2015, concluding said capacities are in line with the fiduciary role planned for the entity under the Project. FONADEFO will open an operating account for the sole purpose of paying the CES program beneficiaries. MARENA will be in charge of any related procurement and cover the eligible operational costs incurred by FONADEFO staff in conducting the Project-related tasks. The CES program’s Manual of Technical and Administrative Procedures details the operational aspects of the financial roles and responsibilities of MARENA and FONADEFO. These changes in the flow of Project funds and reporting procedures for implementation of the CES program with the inclusion of FONADEFO do not imply changes in the Project’s disbursements arrangements. Works will be added as an eligible expenditure category under Subcomponent 3.1 on Water Resources Knowledge Base where ANA is the agency responsible for delivery. In case ANA secures access to land to build a structure to house SiAGUA, adding Works as eligible expenditure will allow the Project to finance finalizing the design and construct a minor building to house the SiAGUA team and equipment. Currently, ANA does not count with the physical space needed for SiAGUA, and it would prioritize its remaining Project funding to be used for constructing said space. At the moment of restructuring, a full feasibility review of the proposal remains pending related with the fact that the ANA office is located on terrain owned by another entity. Consequently, ANA will need to secure access to that land through, for example, the execution of a long term lease agreement or other arrangements acceptable to the World Bank. .

Appraisal SummaryAppraisal Summary Change in Economic and Financial AnalysisExplanation:

18

Pilot WSH works under Subcomponent 1.1 will be implemented in the four municipalities of Juigalpa, Murra, San Ramón, and San Juan de Limay. During Project preparation, the municipalities were selected to represent a range of climatic, geological, social, and institutional conditions. The municipalities are at least partially within four sub-basins that were included in a preliminary Diagnostic Study (the Río Mayales, Jicaro-Susucayan, Río Upa-Wuabule, and Río Negro sub-basins). Based on the original cost estimations, the available funds were expected to cover climate resilient water supply infrastructure for 15 communities with an estimated 4,500 direct beneficiaries, half of them women. Said communities were selected following a pre-defined set of criteria and based on the results of municipal level climate change risk analysis on the available water resources, concluded by the National Agrarian University in September, 2013. The selection criteria included, among other aspects, that the communities were categorized and prioritized in the vulnerability group 1 based on the national system of Municipal Plans on a scale of 1 to 15. For said communities, the poverty rate related to water scarcity surpasses 75 points, and other indicators on poverty, education and services coverage also rank amongst the lowest. Based on the experience of the Nicaragua Rural Water Supply and Sanitation Project (PRASNICA, P106283), the investment costs for upgrading rural water supply infrastructure were estimated at US$40,000 per community. During Project preparation, the costs for more climate resilient water supply infrastructure were estimated between US$50,000 and US$70,000 per community. The higher cost estimate was due to the additional investments and studies needed to guarantee enhanced climate resilience of the constructed infrastructure. This estimation was based on the Diagnostic Study carried out as part of the Project preparation. It revealed that climate resilient solutions would require hydrogeological or catchment area assessments prior to construction, and the infrastructure that is more resilient to climate impacts would likely be more expensive as well (e.g., the wells may need to be deeper or have a metal casing to cover the head of the well, or more advanced systems that rely on pumping may be needed but result more expensive). Lastly and importantly, the initial cost estimates only covered water supply infrastructure; no sanitation and hygiene infrastructure. A revised cost analysis conducted by FISE in March 2014 for the needed investment for the pilot works revealed that the cost estimations made during Project preparation were too low. Prices for standard sector infrastructure had risen, and the number of communities that the Project budget could cover was reduced from 15 to 12, yet no formal restructuring of the Project’s results framework took place at that time. During the Project’s MTR, it was concluded that the Project pilots need to cover full design of climate resilient WSH services. This is aligned with the prevailing FISE policy on investing in combined packages of water supply, sanitation and hygiene infrastructure and related social facilitation to achieve integrated and more sustainable results. This approach has been consolidated as a national policy over the recent years in close collaboration with the World Bank. Consequently, it was not considered reasonable that the Project would only pilot enhanced infrastructure for water supply. FISE conducted new cost calculations based on the respective cost estimations of the Nicaragua Sustainable Rural Water Supply and Sanitation Sector Project (PROSASR, P147006), a continuation project to PRASNICA: a total cost of US$137,000 per integrated rural water supply and sanitation project without any additional climate resilience measures. The MTR concluded that the additional costs associated with incorporating aspects of enhanced climate resilience would bring the total investment cost to US$175,000 per community. Due to the new and substantially higher cost estimates and the integrated approach to the pilot infrastructure, it became clear a reduction in the number of targeted communities was unavoidable. The number of the target communities sized down to seven communities, prioritized based on the population size in order to prioritize the biggest communities. Another criteria for the prioritization of the communities was the Project being the only identified funding source for WSH investments. The revised target on direct beneficiaries is 1,329 people.

19

Annex 1: Revised Results Framework NICARAGUA: ADAPTATION OF WATER SUPPLIES TO CLIMATE CHANGE PROJECT

NICARAGUA: Adaptation of Water Supplies to Climate Change

Revised Results Framework Project Development Objective (PDO): to pilot water resources protection and drinking water supply systems with an integrated and participatory approach in selected climate vulnerable communities in Nicaragua. PDO Level Results Indicators

Cor

e Unit of Measure

Baseline (2012)

Status (March 2016)

Cumulative Target Values Frequency Data Source/ Methodology

Responsibility for Data Collection

Description (indicator definition, etc.) YR 4

2016 YR 5 2017

YR 6 2018

Indicator One: Integrated and participatory pilot investment projects completed in selected climate-vulnerable communities

Number 0 0 0 5 7 Annual Review of progress reports from SICPRO (Project Management System), social facilitators’ field survey reports and the investments related tools developed (see intermediate results indicator, IRI 3.3)

MARENA FISE ANA

The indicator measures the Project performance in terms of completing fully delivered ‘integrated and participatory pilot investments’ on rural drinking water supply systems that combine sanitation and hygiene and integrate climate considerations in their planning, design and construction. Integrated investments refer to combined investments in drinking water supply, sanitation and hygiene, including training and awareness raising within the beneficiary communities. Participatory investments refer to a process of social work conducted along

20

planning, design and construction of the infrastructure that promotes communities’ and municipalities’ ownership of the works and readiness to take care of the subsequent maintenance and reasonable water use. The unit of measure is the number of completed pilot works that combine the related technical tools elaborated by MARENA and FISE to allow replication and scale-up; tools measured by the new IRI 3.3. The targets only reflect investments planned under Subcomponent 1.1. Additional people with access to improved water resources will result under Subcomponent 2.2., but their number remains to be seen.

Indicator Two: People in rural areas provided with access to Improved Water Sources under the project

Number 0 0 0 1,017 1,329 Annual Review of progress reports of completed works from SICPRO and technical inspection and

FISE MARENA ANA

This indicator measures the number of persons that benefit from Project-financed new or rehabilitated infrastructure to supply safe drinking water, sanitation and hygiene

21

social facilitators’ field survey reports

facilities. Said infrastructure will provide “improved water resources” as the related planning and design base on technical studies that consider and address projected climate impacts and include measures that integrate water resources protection. The targets only reflect investments planned under Subcomponent 1.1. Additional people with access to improved water resources will result under Subcomponent 2.2., but their number remains to be seen.

Indicator Three: Water Source Protection Index in water recharge areas of selected climate-vulnerable communities that benefit of a Compensation for Environmental Services (CES) program supported by the project, disaggregated by municipality

Number 52,315 Not available

62,778 73,241 73,241 Annual Data from the baseline field survey and annual monitoring data of vegetation cover, using the methodology described in the Technical and Administrative Procedures

MARENA FONADEFO

The Water Source Protection Index measures the vegetation cover in the water recharge areas of the water supply sources of selected 34 climate-vulnerable communities. The score is the aggregate value for all 34 communities that will also be disaggregated by municipality. The Index is described in the Technical and

22

Manual of the CES program

Administrative Procedures Manual of the CES Program. It is to be noted that the presented baseline value only refers to the aggregate score of the farm plots that the participating farmers committed to improve through their participation in the CES program. During the Project MTR, it was decided that the program needs to monitor land use changes in the full recharge areas. To collect said data, FONADEFO will need to conduct field monitoring that can only take place after the proposed restructuring is effective. Consequently, the baseline data will be adjusted once it has been completed after mid-2016. The incomplete baseline data does not impact the estimate of the realistic target values for the Index.

23

Indicator Four: Direct project beneficiaries, percentage of which female

Number 0 8,427 49%

8,793 49%

9,594 49%

23,801 50%

Annual Progress Reports from SICPRO

MARENA FISE ANA

Progress on this indicator is measured based on the: (1) total population of the two Corn Islands (8,000 people); (2) number of farmers receiving cash payments under the CES program (277); (3) number of persons with new or rehabilitated drinking water supply systems under Subcomponent 1.1 (1,329); (4) total population of the 34 downstream communities whose 56 water sources benefit of the CES program under Subcomponent 1.2 (13,895); and (5) technicians of key public institutions trained in the area of water resources and climate change (300). The above numbers reflect the final target number for each group of direct beneficiaries.

24

INTERMEDIATE RESULTS INDICATORS

Intermediate Results Indicators C

ore Unit of

Measure Baseline Status

(March2016)

Cumulative Target Values Frequency Data Source/ Methodology

Responsibility for Data

Collection

Description (indicator definition, etc.) YR 4

2016 YR 5 2017

YR 6 2018

Component 1: Pilot Adaptation Initiatives to Enhance Climate Resilience in the Selected Municipalities IRI 1.1: Improved community water points constructed or rehabilitated under the project

Number 0 0 0 5 7 Annual Review of social facilitators’ field survey reports and progress reports from SICPRO on completed works and technical inspection

FISE ANA MARENA

This indicator measures the number of integrated and participatory pilot infrastructure completed in selected climate-vulnerable communities. Said infrastructure will provide “improved community water points” as the related planning, design and construction base on technical studies that consider and address projected climate impacts and include measures that integrate water resources protection.

IRI 1.2: Drinking water sources with climate adaptation measures in their recharge areas

Number 0 28 28 56 56 Annual Review of the status of the annual land use plans under the CES program at farm level and direct observations during the field monitoring of the CES program

MARENA FONADEFO

The indicator measures the drinking water sources (36 wells and 20 rivers) in which recharge areas 80% of the respective CES program participants comply with at least 80% of the annual activities defined in their farm’s land use plan. The indicator aggregates to an indicator of the National

25

Human Development Plan 2013–2017.

Component 2: Coastal Wetland Protection and Reduction of Vulnerability to the Sea Level Rise in the Municipality of Corn Island IRI 2.1: Index of wetlands protection measures implemented by the project to improve adaptation capacity of water supply on Corn Islands

% 0% 50% 60% 70% 70% Semi-annual

Reports of field surveys and direct observation

MARENA FISE Environmental authority of the South Caribbean Autonomous Region Municipality of Corn Island

The wetlands protection index comprises of five dimensions: (1) delimitation, (2) labeling and (3) reforestation of wetlands, (4) elaboration of a land use plan on the Corn Islands, and (5) environmental awareness-raising actions to maintain the wetlands clean. The methodology used to calculate the index results is described in Table 1 below.

IRI 2.2: Environmental and climatic monitoring stations established and functioning on Corn Islands

Number 0 2 2 2 2 Semi-annual

Review of standard and customized reports on environment and climate from the monitoring stations

MARENA INETER

The two referenced stations collect monitoring data on precipitation, temperature and sea level.

26

Component 3: Institutional Strengthening, Project Management and Monitoring IRI 3.1: Climate Information Module for water and climate change developed and integrated in the National Water Resources Information System (SiAGUA)

Y/N N N Y Y Y Annual Review of standard and customized reports from SiAGUA

MARENA ANA FISE

The SiAGUA Climate Information Module bases on 22 climate-related indicators defined through a process of inter-institutional consultations and collaboration, and to which different institutions will contribute related information. The Module will record and analyze information on water resources and climate change generated by the Project and other similar projects and related institutions. The system will facilitate digital hydrologic and climate change information to be used in planning.

IRI 3.2: Technicians of key public institutions trained in the area of water resources and climate change, percentage of which female

Number 0 150 30%

200 35%

300 40%

300 40%

Semi-annual

Training providers’ reports with lists of participants

MARENA FISE ANA

Staff of MARENA, FISE, ANA, INETER, Nicaraguan Water and Sewerage Enterprise (ENACAL), Ministry of Agriculture (MAG), Ministry of Energy and Minerals (MEM), universities and public departments at national level, environmental authorities of the South Caribbean Autonomous Region (RACCS),

27

Nicaraguan Water Supply and Sewerage Institute (INAA), and the National Entity for Electricity (ENEL) are trained by the Project in climate change and integrated water resources management.

IRI 3.3: Tools to incorporate climate change adaptation in water and sanitation investments developed by MARENA and FISE

Number 0 2 5 10 10 Semi-annual

Review of the tools developed

MARENA FISE

Ten tools (methodologies, manuals and technical guidelines) will be developed and fine-tuned during Project implementation for potential adoption by the responsible agencies for replication and scale-up. Said tools are listed, described and scheduled in Table 2 below.

28

Table 1: Index of wetlands protection measures to improve adaptation capacity of water supply on Corn Islands (new IRI 2.1)

Indicator: Index of wetlands protection measures implemented by the Project to improve adaptation capacity of water supply on Corn Islands Unit of measure: % Description of the index: The index quantifies and monitors the level of compliance of the following five wetlands protection measures implemented and promoted by the Project: wetlands 1) delimitation, 2) labeling and 3) reforestation, 4) elaboration of a land use plan on the Corn Islands, and 5) environmental awareness rising actions to maintain the wetlands clean. Measure 1: Delimitation of wetlands on Corn Island and Little Corn Island Description: Identification and delimitation of the wetlands conducted by an inter-institutional team consisting of personal from INETER, MARENA and the Municipality of Corn Island to promote sound environmental management on the islands. In early 2013, the delimitation process included resettlement of 10 families that resided in the Coe Wetland. The semiannual monitoring will verify the maintenance of the wetlands’ area. Measure 2: Labeling of the wetlands on Corn Island and Little Corn Island Description: Based on the cadastral boundaries, the delimited wetlands have been provided with visible signs that name them and their area and prompt people to conserve and protect them as critical water sources that have suffered fragmentation and degradation through increasing human activities and sea level in absence of territorial planning. The semiannual monitoring will verify the condition and maintenance of the signs. Measure 3: Wetland reforestation on Corn Island Description: Wetlands reforestation to repopulate red mangrove in order to help improve its biological and physical conditions and, thus, preserve and maintain the related aquifers and provide conditions to adapt to climate change impacts. The Project has reforested approximately 10 hectares in 15 wetlands. Measure 4: Elaboration of a land use plan on Corn Island and Little Corn Island Description: An inter-institutional team consisting of personal from INETER, MARENA, FISE, ANA and the Municipality of Corn Island will conduct a process of territorial planning on the Corn Islands with technical lead by INETER and particular focus on environmental and climate change aspects to facilitate the islands’ sustainable development. The result for this measure will be considered achieved at the same time for all the wetlands, once the plan has been completed. Measure 5: Environmental awareness rising actions to maintain the wetlands clean Description: A minimum of one cleanup of wetlands per year will be organized by environmental promoters in order to raise awareness and build

29

values of love, care and protection of Mother Earth and to prompt shared responsibility of protecting the aquifers of the Corn Islands as a source of safe water for the islanders. Methodology of calculation: A team of Project personal, including representation of MARENA and the Municipality of Corn Island will verify the state of the five wetlands conservation measures through biannual field visits to the targeted 27 wetlands of the two islands. To calculate the result, compliance with each measure will be verified in each wetland to calculate the overall compliance in number and percentage of the targeted measures per wetland and in total using a table as presented below. The index provides a cost-efficient methodology to monitor and a proxy to present and report on the state of the Project activities aimed at wetlands conservation and protection on Corn Islands to help direct additional efforts on particular measures and/or wetlands as needed. Wetland Measure 1 Measure 2 Measure 3 Measure 4 Measure 5 Total Percentage 1. X/5 % 2. X/5 % Etc. until 27 X/5 % Total of the measures complied with

XX/27 XX/27 XX/27 XX/27 XX/27 XX/135 %

Table 2: List of tools that incorporate climate change adaptation in water and sanitation investments (new IRI 3.3)

Tool Responsible Agency and Target Year of Completion

Comments

1. Technical manual to protect water sources with climate change adaptation approach

MARENA 2014

A manual that establishes technical criteria and administrative procedures to be applied in the Water Source Protection Program (Programa de Protección de Fuentes de Agua - PPFA) to compensate beneficiaries who implement sustainable practices in their farming activities and generate positive effects in land use and management to protect water resources adapting the ecosystems of the watersheds to climate change in the municipalities of San Ramón, San Juan de Limay, Murra and Juigalpa.

2. Guideline to develop and systematize implementation of Municipal Plans for

MARENA 2014

A guideline that explains methodological steps to develop municipal plans (PMPAFCC), which explain methodological process to develop actions for conservation, management and protection of natural resources to adapt to climate

30

Tool Responsible Agency and Target Year of Completion

Comments

Environmental Protection in face of Climate Change (Planes Municipales de Protección Ambiental de las Familias ante el Cambio Climático, PMPAFCC)

change impacts under the principles of the common good of the Mother Earth and human values, ensuring a process of capacity building and empowerment of the actors in environmental issues related to climate change. The related capacity building is part of the adaptive process that contributes to the identification of appropriate adaptation measures for local conditions.

3. Methodology to determine vulnerability of water sources and drinking water systems

MARENA 2016

A step by step description of how to estimate the vulnerability of water resources with a Safe Water Index that addresses coverage, quantity, quality, continuity and water consumption habits (cultura hídrica), including how to determine potential water recharge zones at the community and water source scale. The methodology will be developed through an inter-institutional effort led by MARENA with contributions from FISE and ANA.

4. Methodology to delimit water recharge areas in the drinking water supply sector

MARENA 2016

A step by step description of how to delimit water recharge areas; a methodology that facilitates climate-smart water resources management to supply safe drinking water.

5. Guide of good practices for wetlands protection with a focus on climate change

MARENA 2017

A guide that provides and develops good practices to protect wetlands as water source. These practices correspond to the adaptation measures implemented on Corn Islands with the Project intervention.

6. Land use plan on the Corn Islands

MARENA 2017

A process of inter-institutional territorial planning on the Corn Islands with technical lead by INETER and participation by INETER, MARENA, FISE, ANA and the Municipality of Corn Island will include particular focus on environmental and climate change aspects to facilitate the islands’ sustainable development.

7. Improved Environmental Management System (Sistema de Gestión Ambiental, SISGA) to incorporate key considerations and

FISE 2016

SISGA will be updated to evaluate, validate and focus on environmental instruments applied at various stages of the FISE project cycle in rural water and sanitation focusing on climate change adaptation and watershed management, as well as to articulate SISGA in FISE’s other operating manuals and tools, and

31

Tool Responsible Agency and Target Year of Completion

Comments

methodologies for environmental management in water and sanitation works to help enhance climate resilience

design environmental performance indicators for rural water and sanitation projects.

8. Improved manual of implementation for water and sanitation projects (Manual de Ejecución de Proyectos de Agua y Saneamiento, MEPAS) to integrate key considerations and methodologies for enhanced climate resilience of the developed projects

FISE 2017

Adjustments will be made to the MEPAS in accordance with the new tools for environmental assessment and W&S works’ design and implementation, including adaptation measures to climate change with integrated and sustainable watersheds approach developed through the Project in inter-institutional cooperation.

9. Technical guide for water harvest in rural areas

FISE 2017

The existing data and experience gained on water harvesting in Nicaragua will be revised to prepare a technical guide for water harvest in rural areas as an additional methodology to provide for rural drinking water and sanitation systems. This guide will be developed through inter-institutional collaboration lead by FISE with contributions from MARENA and ANA, reflecting national and international experiences and with support of interested development partners, donors, and non-governmental organizations.

10. Updated Project Management System (Sistema de Control de Proyectos, SICPRO)

FISE 2017

The SICPRO is being updated by the PROSASR project (P147006) executed by FISE to revise the processes that constitute the cycle of W&S projects. This Project will contribute to the SICPRO update by producing the applicable cost information on designing and constructing W&S works that integrate considerations of climate change adaptation, as well as indicators for post-project monitoring on key environmental and climate change aspects related with water resources management.

32

Table 3: Additional indicators to be monitored based on the SCCF Tracking Tool for Climate Change Adaptation Projects

Indicator Unit of measurement Baseline Actual at mid-term

Actual at completion Comments

Direct beneficiaries (TT Indicator #1)

Number of people 0 8,427

As under the Project’s official results framework above, the number of direct beneficiaries is measured based on the: (1) total population of the two Corn Islands (8,000 people); (2) number of farmers receiving cash payments under the CES program (277); (3) number of persons with new or rehabilitated drinking water supply systems under Subcomponent 1.1 (1,329); (4) total population of the 34 downstream communities whose 56 water sources benefit of the CES program under Subcomponent 1.2 (13,895); and (5) technicians of key public institutions trained in the area of water resources and climate change (300). The above numbers reflect the final target number for each group of direct beneficiaries. The 8,427 direct beneficiaries at the Project mid-term review in July 2016 included the total population of the Corn Islands, the farmers that receive cash payments under the CES program, and technicians of key public institutions trained in the area of water resources and climate change. Additional to the direct beneficiaries and regarding vulnerability assessments carried out under the Project, the Project can report on a total population of 82,633 people that live in the four beneficiary municipalities in continental Nicaragua where the Project has produced a Municipal Plan for

33

Indicator Unit of measurement Baseline Actual at mid-term

Actual at completion Comments

Environmental Protection in face of Climate Change (PMPAFCC), including analysis of the principal climate related threats and vulnerabilities.

% female 0 49% Type and extent of assets strengthened and/or better managed to withstand the effects of climate change (TT indicator #2)

ha of land 0 2,010

The result reflects 2,000 ha under improved land use promoted by Subcomponent 1.2 on the CES program and 10 ha of reforested wetlands on Corn Islands.

Population benefiting from the adoption of diversified, climate-resilient livelihood options (TT indicator #3)

Number of people

Not applicable

% female % of targeted population

Extent of adoption of climate resilient technologies/ practices (TT indicator #4)

Number of people 0 277

The result reflects the number of farmers that receive cash payments for their improved land use practices under the CES program, including promotion of agroforestry and silvopastoral practices.

% female 0 29 % of targeted population 0 40%

Number of ha 0 2,000 The result reflects 2,000 ha under improved land use promoted by Subcomponent 1.2 % of targeted area 0 20%

Public awareness activities Yes/No No Yes

34

Indicator Unit of measurement Baseline Actual at mid-term

Actual at completion Comments

carried out and population reached (TT indicator #5)

Number of people 0 877

The result reflects the following types of training/educational activities and respective numbers of participants: 96 participants in training workshops for environmental promoters; 98 participants in training workshops for educators; 18 participants in training workshops to water and sanitation committees (CAPS); 167 participants in youth forums; 208 participants in drawing contests; and 290 participants in events presenting environmental films.

% female 0 30%

Risk and vulnerability assessments, and other relevant scientific and technical assessments carried out and updated (TT indicator #6)

Number of relevant assessments/ knowledge products

0 4

The result reflects the four PMPAFCCs produced by the Project. During the MTR, a study on water resources availability in Murra, San Juan de Limay and San Ramon and a hydrological and hydrogeological study on the Corn Islands had just started; the Corn Islands study was finalized in December 2015 and the study on the municipalities of Murra, San Juan de Limay and San Ramon in March, 2016.

Number of people/ geographical area with access to improved climate information services (TT indicator #7)

Number of people 8,000

The result reflects the total number of the Corn Islands’ habitants where two climate related monitoring stations were installed and in function by the MTR.

% female 50 % targeted area 100

Number of people/ geographical area with access to improved,

Number of people % female

Not applicable

35

Indicator Unit of measurement Baseline Actual at mid-term

Actual at completion Comments

climate-related early warning information (TT indicator #8)

% targeted area

Number of people trained to identify, prioritize, implement, monitor and evaluate adaptation strategies and measures (TT indicator #9)

Number of people 0 150

The result reflects the staff of MARENA, FISE, ANA, INETER, ENACAL, MAG, MEM, universities and public departments at national level, SERENA/RACCS of the Caribbean coast, UMAS, INAA and ENEL trained by the Project in integrated management of water resources and climate change.

% female 0 30% Capacities of regional, national and sub-national institutions to identify, prioritize, implement, monitor and evaluate adaptation strategies and measures (TT indicator #10)

Number of institutions 0 3

The result reflects training provided to personal of MARENA, FISE and ANA.

Institutional arrangements to lead, coordinate and support the integration of climate change adaptation into relevant policies, plans and associated processes (TT indicator #11)

Number of countries Not applicable

Regional, national and sector-wide policies, plans

Number of policies/plans/ processes

0 2 The result reflects a technical manual on water sources protection with climate change adaptation approach and a guideline to develop and

36

Indicator Unit of measurement Baseline Actual at mid-term

Actual at completion Comments

and processes developed and strengthened to identify, prioritize and integrate adaptation strategies and measures (TT indicator #12)

systematize implementation of Municipal Plans for Environmental Protection in face of Climate Change (PMPAFCC) that MARENA developed in 2014.

Sub-national plans and processes developed and strengthened to identify, prioritize and integrate adaptation strategies and measures (TT indicator #13)

Number of plans/processes

0 4 The result reflects the four PMPAFCCs produced by the Project.

Countries with systems and frameworks for the continuous monitoring, reporting and review of adaptation (TT indicator #14)

Number of countries Not applicable

Reporting on GEF gender indicators

Q1: Has a gender analysis been conducted during project preparation? No

Q2: Does the project results framework include gender responsive indicators, and sex-disaggregated data? Yes Q3: Of the policies, plans, frameworks and processes supported (see indicators 12 and 13 above), how many incorporate gender dimensions (number)? None by the Project MTR. Q4: At mid-term/completion, does the mid-term review/terminal evaluation assess progress and results in terms of gender equality and women's empowerment? No