The project covers Bacău Municipality and 22 surrounding communes and addresses about 275.000 inhabitants (175.000 inhabitants in Municipality of Bacău and 100.000 inhabitants in rural areas). The current solid waste management in Bacău County is environmentally unsustainable. It does not comply with the requirements of neither EU Directives/regulations nor Romanian legislation and exposes the local community to major environmental and health risks.
In the communes, waste is disposed at 55 small, uncontrolled dumpsites. The current landfill servicing Bacău Municipality, constructed in 1970, does not comply with any environmental or health standards. Organized waste collection is currently limited largely to Bacău Municipality and collection activity is almost non-existent in the villages.
Currently in Bacau County the waste management project “TA for management and supervision of ISPA contracts in the solid waste sector in Bacau located in Bacau County” is under implementation.
For the ISPA measure entitled „Integrated Waste Management in Bacău Municipality and Surrounding Areas” the indicative procurement plan - according to the Financing Memorandum –Component 7 - proposed a Technical Assistance (TA) for PPP contracts as follows:
- Tariff setting and collection. TA will review, revise and update an appropriate rate and system of tariff and tariff collection. The tariff policy will respect polluter pays principle and assure tariffs affordability.
- PPP implementation; The Technical Assistance will prepare the pre-qualification and tender documentation, including the forms of PPP Contracts for the selection of the operators for the Collection PPP Contract and the Landfill PPP Contract. The TA will prepare the annexes to the PPP Contracts that will set the levels of service and technical standards for the Collection and Landfill PPP respectively. The TA will monitor the selection of the competent operators, which shall respect the principle of open and fair competition and take place in full transparency. In relation to the PPP arrangement, the TA in collaboration with the stakeholders will address the issue of obligations and mutual responsibilities.
- Support Bacau Local Council in setting Solid Waste Management Targets and Rules: Supporting the Contracting Authority in setting solid waste management targets and rules shall develop the outline for the environmental regulatory control on the PPP, including ensuring compliance with all existing laws, regulations or agreements and rules
- Training for the final Beneficiary’s staff
Task 1 – Tariff Setting and Tariff Collection Study
- review, revision and update of an appropriate rate and system of tariff and tariff collection respecting the polluter pays principle and assuring tariff affordability;
- tariff study including an assessment of affordability impacts on the end-user households;
- preparation of sensitivity analysis for demand forecasts, capital expenditure programmes, operation, maintenance and management costs, tariff structure, alternative efficiency forecasts, funding gaps, etc.;
- development of service standard regulations;
- definition of investment needs and preparation of capital expenditure programmes for the PPP period;
- review of existing regulations regarding relevant municipal services and determine their suitability to regulate the PPP and the local ordinances and local regulations that may affect the procurement process and the project.
Task 2 - Preparation and Implementation of Concession Contracts
- Review and update of Waste Management Masterplan including analysis of private sector involvement at present and in future in solid waste transport, collection, treatment, sorting, recycling and final disposal/landfilling
- Preparation of tender documentation, including forms of concession contracts for the selection of operators for 1) waste collection and transportation, green points and sorting plant operation and 2) operation of landfill and treatment and disposal facilities located on the landfill site
- Preparation of annexes to the Concession Contracts that set levels of service and technical standards for both contracts respectively
Compilation of all required documents including:
- Draft Public Private Partnership Agreements –including tariff and service rules, asset maintenance rules, service standards and the regulatory mechanism and all other clauses necessary to protect the public interest
- Draft Operations Agreements – setting out the payment mechanism, targets and boni, penalties for non performance etc
- Draft Lease Agreements – setting out tariff and service rules, service standards, payment mechanism, regulatory mechanisms and all other clauses necessary to protect public interest
- Preparation of the form of the Invitation to Tender (ITT) for the local authorities to review and issue. The tenders will be based on well defined bidding parameters upon which bidders shall be easily compared
- Any other legal documents required under Romanian law for the purposes of the relevant tender
- Support Contracting Authority in tendering phase, tender evaluation phase, selection of competent operators, contract award up to signature of concession contracts
- articles of association and related documents (i.e. shareholders agreements etc,) – including everything needed under Romanian law to establish the operator as a joint private/public venture and possibly a separate operating company;
- Sale and purchase of Leasing Agreements – in respect of capital assets changing hand during the period of the Public Private Partnership on a temporary of permanent basis;
- Possible Contracts with other Municipalities
- legal and operational documents necessary to set up the transaction structure and legal documents required under Romanian law
- Assistance in contract closure - assistance in the review of other documentation and subsequent changes to the contract documentation (loan, direct, technical service agreements, etc.)
Task 3 - Support Bacau Local Council in setting Solid Waste Management Targets and Rules
Supporting the Contracting Authority in setting solid waste management targets and rules shall develop the outline for the environmental regulatory control on the PPP, including ensuring compliance with all existing laws, regulations or agreements and rules.
Establish monitoring and regulatory arrangements to ensure service quality goals are met. The TA Consultant, in collaboration with the other stakeholders, will address the issues of obligations and responsibilities:.
- review and update of procedures for PPP project assessment,
- review of specific technical assessments,
- assessmentsof contractual models.
Task 4 - Training
Involving the Final Beneficiary's staff in the day-to-day activities of the (knowledge transfer); Training for the Final Beneficiary's staff, PIU, and representatives of the 22 communes involved in the project in all aspects of the two concession contracts / PPP projects
- training with regard to risk and collateral assessment
- training on municipal rules and regulation for tariff setting
- advisory on international best practice experiences and failures
- support in the compilation of relevant experiences;
- training on the job on specific technical and organizational issues.