ModifiedCostSharingRules

(Ref: Annex:6 Attachment 6D, Project Appraisal Document

modified by letter dated October 29, 2008 from the Country Director, The World Bank)

WATER
SUPPLY/SANITATION

I.

O&M

Cost Sharing

Remarks

% of Total
Costs

A. WATER SUPPLY

1.New SV Schemes

100% by users

2.New MV Schemes

100% by users

3. Transferred SV Schemes

100% by users

4. Existing MV Schemes

100% by users

B. Community Sanitation
(Open Drains, Small Bore
Sewers, Sewerage systems,
Ponds Rehabilitation)

100% by users

II. INVESTMENTS

% of
Construction
Costs

GPWSCs will fix a tariff adequate enough to cover the full

O&M costs from the users. GPWSC may hire outside
agencies for the operation and maintenance (O&M) of the
scheme in mutually agreed terms. The agency may also
assist GPWSC in billing and collection.
DWSS will make bulk supplies on volumetric basis and levy
water charges to GPWSCs based on tariff for such bulk
supplies fixed by DWSS from time to time. The responsibility
for the O&M of intra village distribution system would rest
with the respective GPWSCs. Outside agencies can be hired
by them for O&M of the intra-village system and billing and
collection. The GPWSC shall fix tariff adequate enough to
recover the cost of water charges to be paid to the DWSS as
well as for expenditure incurred on the O&M of intra village
arrangements, from the users.
O&M cost may exclude the cost of staff deployed by DWSS
which will be progressively phased out over a period of time.
GPWSCs will set a tariff adequate enough to cover the full
O&M costs from the users. After the phasing out of DWSS
operational staff, GPWSC may hire outside agencies for the
O&M of the scheme in mutually agreed terms. The agency
may also assist GPWSC in billing and collection.
Same as for new MV Schemes but implemented
progressively linked to new investments for scheme
upgradations and transfer of intra village distribution
responsibility to GPs/GPWSCs.
GPWSCs shall recover full O&M costs from the users.
GPWSCs may decide on the O&M arrangement including
contracting with an agency.

A. WATERSUPPLY

1.All WS schemes for all

Technology Options (incl. SV
and MV schemes and other
technologies like RO, etc.)

10% by users,
subject to a
maximum
of
Rs. 800/- per
household.

a)

Capital cost shall include common infrastructure from

source to distribution pipes, but exclude the cost of
household service connections and consumer meters.

b)

Households in Difficult Areas (i.e. notified villages

along International Border, Kandi area, Bet area, and
Water-logged area) will contribute 5 % of the capital
cost subject to a maximum of Rs. 400/- per household.

c)

SC household 50% of the prescribed amount.

Note: As far as possible, beneficiary contribution will be

raised from all households in a village. Where the
contribution made by the community falls short of the
target amount (10% of scheme cost for general villages
and 5% of scheme cost for difficult areas), the gap is to
be filled-up following a stepped approach, first, by
raising voluntary contribution from the community;
second, through non-budgetary resources of the GP;

third, by accessing untied funds available with the

district administration; and lastly, through state
government grant. Compliance with this principle is to
be certified by a credible agency, such as the NGO
working in the respective GP or reputed civil society
organization.
d) Household service connection will entail a minimum of
Rs. 500/- (A minimum of Rs. 250/- for the Difficult
Areas explained in IIA1(b) above.
For SC household, 50% of the prescribed amount.
Note: (i) The connection fee will be collected prior to the
laying of the distribution system.
(ii) 50% higher connection fee shall be charged for
household service connection if applied after the
laying of distribution system.
(iii) The connection fee shall be collected by GPWSC
and retained in its fixed deposit amount in a Bank.
The money could be used for future improvement
of respective scheme, to meet expenditures on
rehabilitation,
and
for
any
unforeseen
contingencies..
e)

Cost (material and labor) incurred for connection

(including all material) from the service pipe to house
shall be borne by the respective household.

f)

GPs will make available land for the water work site
as close as possible to the village, and the same will not
be counted against contribution.

g)

In the case of MV schemes, the village offering land for

water works shall be compensated duly by other
benefitting villages. The GP offering land shall pay 30%
less contribution and the same shall be borne by the
other GP/GPs.
h)

(i)

B. COMMUNITY
SANITATION

2.
Community Sanitation Drainage Ponds rehabilitation,
small bore sewer/sewerage
schemes

Note: Provision of sewerage

scheme alongwith rehabilitation of
pond in a village will be considered
as one package

For extension of distribution system /improvement

in existing schemes, beneficiary contribution is to
be recovered from households actually receiving
benefits. Contributions may also be received from
other households who volunteer to share cost.
In the case of extension/improvement of existing
water supply system 20% of the contribution
amount may be borne by the respective GP from its
own revenue.

% of
Construction
Costs

Remarks

10 % by users
subject to a
maximum
of
Rs. 800/- per
household

a) Contributions for sanitation scheme shall be separate

from that for water supply.
b) The Medium-Term Program will finance only the common
facility. All household specific investments and the cost
(material and labor) incurred for sewer connection are to be
borne by the respective households.
c) Sewerage scheme/ small bore sewers scheme will not be
taken up unless at least 70% of the households give their
commitment to construct latrines and intercepting chambers
in their houses and express their readiness to take sewer
connection from the common facility.
d) Households in Difficult Areas as explained in IIA1(b)
above - 5%, subject to maximum of Rs. 400/- per household.
(e) SC households 50% of the prescribed amount.
Note 1 (i)-Other funds such as GPs external funds, NRI
Donations, etc. can be used to meet the
'contribution' upto 30% of the total beneficiary share
and GPs may contribute a maximum of 20% of the
contribution and remaining 50% will be contributed
by the users.

(ii)

In case MPLADs funds are to be used then its

contribution shall be equal to 50% of the community
share and the remaining 50% community share will
be contributed by the users.
Note 2:- (i) Household sewer connection shall entail a
fee of Rs. 500/- per household for general category and
Rs. 250/- per household for those in the Difficult Areas
explained in IIA1(b) above).

(ii)
(iii)
(iv)

(v)

(vi)

For SC household, sewer connection fee will be

50% of the prescribed amount.
The connection fee will be collected prior to the
laying of the sewer pipes in the streets.
50% higher connection fee shall be charged for
household service connection if applied after the
laying of sewer pipes in the streets.
The connection fee shall be collected by GPWSC
and retained in its fixed deposit amount in a Bank.
The money could be used for future improvement
of respective scheme, to meet expenditures on
rehabilitation,
and
for
any
unforeseen
contingencies.
Monthly O&M cost shall be a minimum of Rs. 20/up to two seats and Rs. 15/- for every additional
seat.

Capital Cost Contribution - ADMINISTERING

Installment
1st
2nd

Share( %) (cash)
Preferably 50% of the estimated
community contribution amount or a
minimum of Rs.50,000/Remaining amount of share to make it
equal to 100% (10% of scheme cost for
general category villages and 5% of
scheme cost for villages in Difficult Areas)

Time of Payment
At the time of giving written consent by GPWSC to
join the project (after initial round of project
dissemination).
Before Invitation of the bids for construction of water
supply and sanitation schemes.