Municipal Development & Decentralization Project

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The objectives of the Municipal Development and Decentralization Project are to: (1) assist the decentralization process at the central and local government level; (2) promote an improvement of financial and administrative management as well as municipal investment program; (3) support urgent local investments; and (4) generate employment opportunities. The first of the two main components, Institutional Development, has two subcomponents: (1) helping to implement a municipal development program centered on binding agreements (MDAs) between the central government and participating municipalities to improve organization and management, including public services delivery, strengthen municipal planning and programming procedures, human resource planning, and physical investment project implementation management, and (2) strengthening the central government's capacity to implement effectively the planned decentralization program by developing national information systems, analyzing policy alternatives, evaluating the impact of regional and sector investments on municipal finance, establishing a project coordinating unit, and supporting the initial investment and operating costs of the Municipal Development Fund (MDF). The second component, Physical Investments, will finance municipal investments listed in the Priority Investment Plan (PIP). Investments include construction rehabilitation and maintenance of public infrastructure (primary and secondary facilities) and services operated by local government, such as roads, drainage, lighting, etc.; water supply, sanitation, and solid waste management; revenue generating facilities; health and school facilities; and rehabilitation of historic properties.