Surgut Housing Refurbishment Project

complete

The proposed project would involve loan to the City of Surgut (the City), a municipality in the Khanty-Mansi Autonomous Okrug (the Okrug). The project would focus on pilot programme to refurbish rapidly depreciating municipal and private housing stock. The project would also focus on development of long term municipal housing policy and institutional strengthening of the municipal housing agency to be established in the due course of project implementation. The project is likely to have significant demonstration effect as it will establish a foundation for a sustainable municipal housing policy in the city. The transition potential of the operation relates to: (i) development of a long term sustainable operational approach for the housing refurbishment through an arms length municipal housing company; (ii) development of a long term housing policy and establishment of the arm-length housing development agency to take charge of future housing refurbishment programmes in the City (ii) encouragement of private sector involvement and competition into provision of housing management and maintenance services. The project will also contribute towards strengthening of corporate governance standards and transparency in housing development agency through introduction of IFRS for financial reporting and regular external audits. The municipality of Surgut will be the Borrower. The loan up to RUB 700 million (EUR 20.4 million) to the City. RUB 1,344 million (EUR 40 million). A housing project such as this project has specific environmental impacts which, however, can be readily identified and mitigated through adequate measures and application of good international practice. For the above reasons, the EBRD has classified the project B/1 requiring an Environmental Analysis and Audit of the proposed site and associated facilities. An environmental analysis of the existing situation and future impact has been carried out as part of the feasibility study by independent consultants funded by the EU. The analysis confirms that there are no significant environmental issues associated with the Project. Further documentation on the project will be reviewed by the Bank in due course. The review confirms that there are no significant environmental impacts associated with the project and site. The City will need to ensure that the re-housing process is conducted in accordance with the EBRD’s Environmental Policy requirements. The newly established municipal housing development agency ( MHDA) will be required to supervise private contractors retained for project implementation in terms of compliance with prescribed Russian and EU environmental, health, safety and labour standards during project implementation. The Project will involve significant social and environmental opportunities: improvements in housing conditions and energy saving through lower demand for heat. The Bank will evaluate the project’s compliance with the applicable environmental and social requirements during the lifetime of the project by reviewing annual environmental reports (AER) prepared for the project covering: (1) on-going project-specific environmental, health and safety performance including legal compliance, and (ii) the status of implementation of environmental and social mitigation measures.