document of the world bank · 2016. 7. 17. · date achieved 11/02/2004 12/31/2007 12/31/2007...
TRANSCRIPT
Document of
The World Bank
Report No: ICR2038
IMPLEMENTATION COMPLETION AND RESULTS REPORT
(IBRD-48000)
ON A
LOAN
IN THE AMOUNT OF US$100 MILLION
TO THE
RUSSIAN FEDERATION
FOR A
CADASTRE DEVELOPMENT PROJECT
December 13, 2011
Sustainable Development
Russia Country Unit
Europe and Central Asia Region
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CURRENCY EQUIVALENTS
(Exchange Rate Effective September 20, 2011)
Currency Unit = Russian Ruble
31.364 RUB = US$1
US$ 1.00 = 1.5715 SDR
FISCAL YEAR
January 1 – December 31
ABBREVIATIONS AND ACRONYMS
AM Aide Memoire
BTI Bureau of Technical Inventory
CA Federal Agency for Cadastre of Immovable Property (Cadastre Agency)
CAS Country Assistance Strategy
CIS Commonwealth of Independent States
DO Development Objective
ECA Europe and Central Asia
ECSSD Environmentally and Socially Sustainable Development
FM Financial Management
IBRD International Bank for Reconstruction and Development
ICR Implementation Completion Report
ICT Information and Communications Technology
LARIS Land Reform Implementation Support Project
M&E Monitoring and Evaluations
MOED Ministry of Economic Development
MOF Ministry of Finance
MOJ Ministry of Justice
NGO Non-Government Organization
PAD Project Appraisal Document
PDO Project Development Objective
PIU Project Implementation Unit
RRS Rights Registration Service
RUB Russian Ruble
SOF Subject of Federation
US$ United States Dollar
3
Vice President: Philipe Le Houerou
Country Director: Pedro Alba
Sector Manager: Benoit Blarel, Acting
ICR Team Leader: Malcolm Childress
ICR Author: Tony Lamb/Samantha De Martino
4
RUSSIAN FEDERATION
CADASTRE DEVELOPMENT PROJECT
CONTENTS
Data Sheet
A. Basic Information ....................................................................................................... 5
B. Key Dates ................................................................................................................... 5
C. Ratings Summary ....................................................................................................... 5
D. Sector and Theme Codes ............................................................................................ 6
E. Bank Staff ................................................................................................................... 6
F. Results Framework Analysis ...................................................................................... 6
G. Ratings of Project Performance in ISRs .................................................................... 9
H. Restructuring (if any) ................................................................................................. 9
I. Disbursement Profile ................................................................................................ 10
1. Project Context, Development Objectives and Design ............................................. 11
2. Key Factors Affecting Implementation and Outcomes ............................................ 14
3. Assessment of Outcomes .......................................................................................... 20
4. Assessment of Risk to Development Outcome ……………………………….….. 25
5. Assessment of Bank and Borrower Performance ..................................................... 26
6. Lessons Learned........................................................................................................ 27
7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners........... 29
Annex 1. Project Costs and Financing .......................................................................... 30
Annex 2. Outputs by Component.................................................................................. 31
Annex 3. Economic and Financial Analysis ................................................................. 40
Annex 4. Bank Lending and Implementation Support/Supervision Processes ............. 43
Annex 5. Beneficiary Survey Results ........................................................................... 45
Annex 6. Stakeholder Workshop Report and Results ................................................... 46
Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR ..................... 47
Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ....................... 49
Annex 9. List of Supporting Documents ...................................................................... 50
Annex 10. Subjects of Federation in which Project was Implemented…………….... 51
MAP .............................................................................................................................. 52
5
A. Basic Information
Country: Russian Federation Project Name: Cadastre Development
Project
Project ID: P078420 L/C/TF Number(s): IBRD-48000
ICR Date: 12/13/2011 ICR Type: Core ICR
Lending Instrument: SIL Borrower: RUSSIAN
FEDERATION
Original Total
Commitment: USD 100.00M Disbursed Amount: USD 99.57M
Revised Amount: USD 99.57M
Environmental Category: C
Implementing Agencies:
Federal Agency for Immovable Property Cadastre (to 02/28/2009)
Federal Service for State Registration, Cadastre and Cartography (from 03/01/2009)
Co financiers and Other External Partners:
B. Key Dates
Process Date Process Original Date Revised / Actual
Date(s)
Concept Review: 10/21/2002 Effectiveness: 12/21/2005 12/21/2005
Appraisal: 11/02/2004 Restructuring(s):
Approval: 07/05/2005 Mid-term Review: 11/30/2007 05/30/2008
Closing: 06/30/2010 06/30/2011
C. Ratings Summary
C.1 Performance Rating by ICR
Outcomes: Satisfactory
Risk to Development Outcome: Low or Negligible
Bank Performance: Satisfactory
Borrower Performance: Satisfactory
C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)
Bank Ratings Borrower Ratings
Quality at Entry: Satisfactory Government: Satisfactory
Quality of Supervision: Satisfactory Implementing
Agency/Agencies: Satisfactory
Overall Bank
Performance: Satisfactory
Overall Borrower
Performance: Satisfactory
6
C.3 Quality at Entry and Implementation Performance Indicators
Implementation
Performance Indicators
QAG Assessments
(if any) Rating
Potential Problem Project
at any time (Yes/No): No
Quality at Entry
(QEA): None
Problem Project at any
time (Yes/No): No
Quality of
Supervision (QSA): None
DO rating before
Closing/Inactive status: Satisfactory
D. Sector and Theme Codes
Original Actual
Sector Code (as % of total Bank financing)
Central government administration 98 98
Housing finance 1 1
Law and justice 1 1
Theme Code (as % of total Bank financing)
Administrative and civil service reform 14 14
Land administration and management 29 29
Legal institutions for a market economy 14 14
Personal and property rights 29 29
Tax policy and administration 14 14
E. Bank Staff
Positions At ICR At Approval
Vice President: Philippe H. Le Houerou Philippe H. Le Houerou
Country Director: Pedro Alba Pedro Alba
Sector Manager: Benoit Paul Blarel Benoit Paul Blarel
Project Team Leader: Malcolm D. Childress Malcolm D. Childress
ICR Team Leader: Malcolm D. Childress
ICR Primary Author: Tony Lamb/Samantha De Martino
F. Results Framework Analysis
Project Development Objectives (from Project Appraisal Document) The Project development objective is to improve the information flow and rationalize
normative and operational procedures for the Unified State Cadastre of Immovable
Property so as to facilitate development of real property markets, improve the quality of
7
services provided by the offices of the Cadastre Agency, and strengthen linkages with
other organizations.
Revised Project Development Objectives (as approved by original approving authority)
(a) PDO Indicator(s)
Indicator Baseline Value
Original Target
Values (from
approval
documents)
Formally
Revised
Target
Values
Actual Value
Achieved at
Completion or
Target Years
Indicator 1 : Reduction in the average time for completion of transactions in immovable
property.
Value
quantitative or
Qualitative)
4 months (80 business
days)
1 month (20
business days) 19.5 business days
Date achieved 12/31/2004 12/31/2009 06/30/2011
Comments
(incl. %
achievement)
Result slightly exceeded target (based on a 5 day business week).
Indicator 2 : Providing for market competition in provision of survey (technical inventory)
services.
Value
quantitative or
Qualitative)
0 regions All Regions All Regions
Date achieved 11/02/2004 12/31/2007 12/31/2007
Comments
(incl. %
achievement)
Federal Law No. 221-FZ “On State Real Estate Cadastre” dated July 24, 2007,
allowed market competition throughout the Russian Federation. In 2011, 264
survey firms were accredited to perform technical inventory.
Indicator 3 : Elimination of requirement for survey (technical inventory) for secondary
transactions in immovable property
Value
quantitative or
Qualitative)
Requirement in Place Eliminated Eliminated
Date achieved 11/02/2004 12/31/2006 12/31/2006
Comments
(incl. %
achievement)
Achieved in accordance with target following amendments to the law.
(b) Intermediate Outcome Indicator(s)
Indicator Baseline Value
Original Target
Values (from
approval
documents)
Formally
Revised
Target Values
Actual Value
Achieved at
Completion or
Target Years
Indicator 1 : Reduction in the average time for processing new property surveys by the
Cadastre Agency.
8
Value
(quantitative
or Qualitative)
2 months (8 weeks) 2 weeks 4 weeks
Date achieved 11/02/2004 12/31/2010 12/31/2008
Comments
(incl. %
achievement)
No decrease in processing time since 2008. Baseline value was reduced by 50%.
The law of the Russian Federation establishes a period of 20 working days.
Indicator 2 : Reduction in the number of steps requiring the client to interact with the Cadastre
Agency in connection with transactions in immovable property
Value
(quantitative
or Qualitative)
4 steps 2 steps 3 steps
Date achieved 11/02/2004 12/31/2006 12/31/2008
Comments
(incl. %
achievement)
The steps are as required by law (221-FZ). The requirement for technical
inventory for secondary transaction was eliminated. Submitting an application
for a transaction and obtaining results now can be done electronically or through
the post. This eliminated the requirement to visit the Cadastre Office. In addition,
the registration process is done at the same time without a separate visit to the
registration office as was done prior to the reform. No decrease in number of
steps since 2008.
Indicator 3 : Increased number of client applications processed per cadastral accounting staff
of the Cadastre Agency
Value
(quantitative
or Qualitative)
Average 2 per day Average 7 per day Average 5.5 per day
Date achieved 11/02/2004 12/31/2009 06/30/2011
Comments
(incl. %
achievement)
Since 2007, RosReestr figures indicate that staff processed 5 or more transactions
per business day on average. Target of processing 7 transactions per business day
not fully achieved. Average number of applications per day more than doubled
from baseline.
Indicator 4 : Increased number of information requests
Value
(quantitative
or Qualitative)
916,155
10 percent annual
growth during the
Project
1,463,974 requests.
60% growth
between 2007 and
2011
Date achieved 11/02/2004 06/30/2011 06/30/2011
Comments
(incl. %
achievement)
Figures are total for the country and show a 60 percent rise in the number of
applications based on figures between 2007 and 2011, thus exceeding target.
Indicator 5 : Average time client spends in cadastre office per visit
Value
(quantitative
or Qualitative)
120 minutes 20 minutes 48 minutes
Date achieved 11/02/2004 12/31/2009 06/30/2011
Comments
(incl. %
achievement)
Limited reduction from 120 minutes in 2004 to 48 minutes in 2011. While the
target of 20 minutes was not met, the time spent by clients was cut by more than
half the baseline value.
Indicator 6 : Test mass appraisal methodologies for property valuation
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Value
(quantitative
or Qualitative)
0 percent completed
100 percent of
properties subject
to taxation
100 percent of
properties in 5
pilots tested with
new valuation
system
Date achieved 11/02/2004 12/31/2009 06/30/2011
Comments
(incl. %
achievement)
All properties in the original 4 pilots were valued (Tver, Kemerovo, Kaluga and
Tatarstan). In addition, 5 million properties in Moscow City were valued by the
end of the Project. The Government financed pilot testing in 7 other regions
using its own funds. The plan is to complete the valuation in the country by
2013.
Indicator 7 : Increase client satisfaction with operation of the Cadastre office
Value
(quantitative
or Qualitative)
5.84 6.43 points
Date achieved 12/31/2007 06/30/2011
Comments
(incl. %
achievement)
Using CA/RosReestr satisfaction assessment method, there has been a 10 percent
increase in satisfaction levels between 2007 and 2011. Overall the improvements
over the years were moderate.
G. Ratings of Project Performance in ISRs
No. Date ISR
Archived DO IP
Actual
Disbursements
(USD millions)
1 06/01/2006 Satisfactory Satisfactory 0.50
2 07/11/2006 Satisfactory Satisfactory 0.67
3 01/23/2007 Satisfactory Satisfactory 30.32
4 08/14/2007 Satisfactory Satisfactory 32.90
5 04/19/2008 Satisfactory Satisfactory 77.54
6 10/14/2008 Satisfactory Satisfactory 85.17
7 01/23/2009 Satisfactory Satisfactory 86.72
8 06/29/2009 Satisfactory Satisfactory 88.75
9 10/15/2009 Satisfactory Satisfactory 92.15
10 01/24/2010 Satisfactory Satisfactory 94.37
11 11/06/2010 Satisfactory Satisfactory 95.87
12 06/26/2011 Satisfactory Satisfactory 97.07
H. Restructuring (if any)
Not Applicable
10
I. Disbursement Profile
11
1. Project Context, Development Objectives and Design
1.1 Context at Appraisal
Despite fundamental changes to the economy and nature of property rights in the Russian
Federation during the 1990s and early 2000s, the manner in which real property was
administered remained little changed. Responsibility for land, buildings and rights to real
property were spread across three organizations. There were inadequate linkages between
the organizations, numerous requirements to transact with real property, and poor access
to information. The property market was operating inefficiently, investment was
frustrated, and property was rarely used as security for loans. Consequently, the
contributions of the country’s real property resources to economic growth and social
stability, as well as government revenue, were falling well short of their potential.
The Government, World Bank and donors had begun to support improvements in the real
property administration sector from the early 1990s, through projects such as the Bank-
financed Land Reform Implementation Support (LARIS) Project, which ran from 1995 to
2003. In 2004, the Government initiated a new program of legislative and administrative
reform to improve efficiency, and approved an investment program to establish an
automated, unified record of real property that would improve use of property, improve
market efficiency, and stimulate real property related investment (the Federal Targeted
Program 2006-2011). The Cadastre Development Project (the Project) was to contribute
to these moves to improve real property administration, providing support to the Federal
Targeted Program, and building on the achievements of the LARIS Project. Initially, the
Project idea was to support both Cadastre and registration service improvements because
the ultimate objective of the Bank-Russian Federation cooperation was to support the
integration of these services so as to improve efficiency and effectiveness and to simplify
procedures for the clients. Cadastre services were the responsibility of the Cadastre
Agency (CA), while the registration services were the responsibility of the Rights
Registration Services (RRS). At the time, the Government was not ready to take the
administratively charged decision to merge these agencies. The Bank team preparing the
Project spent considerable effort in devising the implementation arrangements that could
ensure complete cooperation and coordination between these two large agencies while at
the same time aiming to unify them at least through information technology linkages.
This attempt took a considerable length of time. The CA was ready to move on with the
Project, while the RRS continued to consider the legal and operational ramifications.
Under the circumstances and in order to capture the momentum of high commitment on
the CA part as supported by the Government, the Bank agreed to split the initial idea of a
single project into two: The Cadastre Development Project and the Registration Project
(Loan 4826-RU). The two agencies were integrated during Project implementation, a
process that took about one year to complete.
The Project addressed one of three priority areas of the 2002 Country Assistance Strategy
(CAS) – strengthening public sector management – through enhancing accountability and
information flows, improving efficiency and quality of public service delivery, and
improving fiscal management. The Project also assisted with another CAS priority area –
12
improving the business environment and enhancing competition – particularly through
the protection of property rights and greater access to information. The Project was
consistent with the emerging country partnership strategy, addressing two of the four
pillars, namely improving the efficiency of government programs and expenditure as well
as supporting regional development.
1.2 Original Project Development Objectives and Key Indicators (as approved)
The objective of the Project was to improve the information flow and rationalize
normative and operational procedures for the Unified State Cadastre of Immovable
Property so as to facilitate development of real property markets, improve the quality of
services provided by the offices of the Cadastre Agency, and strengthen linkages with
other related organizations. Key outcome indicators linked to the PDO were:
Reduction in the average time for completion of transactions with real property
(from four months to one month).
Elimination of the requirement for survey (technical inventory) for secondary
transactions in real property.
Market competition in the provision of survey (technical inventory) services.
Key intermediate outcome indicators for the PDO were:
Reduction in the average time for recording new property surveys by the CA.
Increased number of client applications processed per staff of the CA.
Reduction in the number of steps requiring the client to interact with the CA in
connection with real property transactions.
Reduced average time for providing service to clients visiting the CA offices.
Application of mass appraisal methodologies for property taxation developed
under the Project.
Increased number of information requests to, and greater client satisfaction with
the CA offices.
1.3 Revised PDO (as approved by original approving authority) and Key Indicators,
and reasons/justification
N/A
1.4 Main Beneficiaries
While the PAD did not specify the targeted population, it is clear from the context that
this group consisted of all those who held rights to real property and those who would
like to acquire such rights; those wanting to make use of information relating to real
property, including real estate professionals and investors, municipalities and higher
levels of government that use real property information or levy taxes on real property.
13
1.5 Original Components (as approved)
The Project included four components: (1) Institutional Development of the Real Estate
Cadastre; (2) Cadastre System Interrelations; (3) Real Estate Taxation Development; and
(4) Project Monitoring and Management.
(1) The Institutional Development of the Real Estate Cadastre component included
legislative and regulatory reform, training, and business system analysis. Reform to the
laws and regulations were to improve the legal framework for making transactions with
real property, with a particular focus on simplifying procedures and removing hurdles to
making transactions. The systems within the CA offices were also to be improved, as was
the structure and operation of the CA. The component aimed to improve the quality of
services to clients, both private and professional, particularly in regard to the provision of
information. Finally, the professional skills of CA staff were to be improved through
training. Under this component, the process of making a transaction was to be made
simpler and quicker for staff and clients.
(2) The Cadastre System Interrelations component was to provide improved information
linkages within the cadastre system and with outside users. This was to be achieved
through the development of an information technology and communications systems,
plus the provision of hardware in selected CA offices across the country, which was to
account for the bulk of Project funds (almost 80 per cent). The subsystem was to improve
information provision and exchange, to improve applications for the CA’s clients, and to
increase archive security through improved archiving and records management functions.
Training in the new subsystem was also to be provided. Similarly, an application was to
be developed for information exchange between the CA offices and the Rights
Registration Service (RRS), within the Ministry of Justice (MOJ), which was responsible
for registration of rights over real property. These systems were to improve the efficiency
of property transactions and information provision, and increase the security of records.
(3) The Real Estate Taxation Development component was to develop improved mass
appraisal methodologies for land and real estate for use by municipal governments, which
would provide an important source of revenue for municipalities. The component was to
establish systems for mass appraisal and monitoring market values, thereby permitting
the introduction of reliable and transparent valuation systems and procedures to support
broad-based and equitable property taxation. Testing was to be conducted in four pilot
areas.
(4) The Project Monitoring and Management component covered both management of
the Project, supported by a Project Implementation Unit (PIU) within the Federal Center
Project Finance, and the monitoring of results in accordance with the indicators specified
in the PAD. Independent surveys of client satisfaction were to be conducted.
1.6 Revised Components
N/A
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1.7 Other significant changes
In 2004, during project preparation, the Government had formally merged two
organizations responsible for real property administration – the Federal Land Cadastre
Service and Bureau of Technical Inventory (BTI) – to form the CA, under the Ministry of
Economic Development and Trade. In December 2008, the Government initiated the
implementation of unifying the key agencies associated with real property by formally
merging the CA with the RRS and the Cartography and Geodesy Agency. The resulting
organization was known as the Federal Service for Registration, Cadastre and
Cartography Services (RosReestr) under the Ministry of Economic Development
(MOED). The merger was fully in line with the Project’s PDO to improve information
flows and rationalized operations. The immediate impact of the change was the
imposition of significant additional duties on management and staff of RosReestr. The
decision entailed some delays as RosReestr management was formed and started to
implement the Government’s decision, which affected some 6,000 offices and 46,000
staff. Nevertheless, the merger was in line with best-recommended practices and along
the lines of improved operations. The Government’s decision is one of the most
important institutional changes, supported by the Bank, which contributed significantly to
the institutional development, improved efficiencies and customer service orientation of
RosReestr.
The original Project Closing date of June 2010 was extended to June 2011 to allow for
the changes that occurred due to the merger to take effect. The merger of the Cadastre
and registration agencies required the restructuring and extension of the legal framework
and software development contracts that were essential to the project and that needed to
reflect the important legal and operational changes of the merger.
2. Key Factors Affecting Implementation and Outcomes
2.1 Project Preparation, Design and Quality at Entry
Project preparation was based on a sizeable body of information and experience. The
LARIS Project, which was successfully completed in 2003, had provided not just
infrastructure, mapping data and training to support real property administration but also
valuable understanding of the needs and capacity of land administrators and the public.
Four project preparation studies were undertaken, including (a) a Review of the Current
Registration System; (b) a Review of existing Information Technology and Strategy for
Future ICT Development; (c) a Review of the legal framework; and (d) a social
assessment. The results of these studies were reflected in project design.
Several of the Bank team members had long and substantial experience in land
administration projects, including the LARIS Project, in the Russian Federation and in
neighbouring countries. The lessons learned from the project preparation studies and
similar projects in the region resulted in the design of a targeted set of activities that were
expected to deliver the PDO. Based on the knowledge and understanding of projects of
15
this kind and conditions in the Russian Federation, the team focused on two critical risks,
the institutional and capacity risks, and formulated practical mitigation measures based
on one or more Project activities. At the same time, the team avoided the risk of waiting
for desired, but substantive, institutional change as a condition for the Project; i.e. the
merging of Cadastre and Registration services under one agency. While the Bank and the
Government took the risk of going ahead with the Cadastre Project (which was in a better
readiness stage), they continued the dialogue during implementation on institutional
reform. Other risks were to be addressed through systematic change to the manner in
which the CA operated or through close supervision. At least one risk – relating to land
allocation and urban planning legislation outside the Project’s ambit – was realistically
assessed as being beyond the scope of the Project or the CA to address unilaterally.
The project design was relatively standard for cadastre projects, having drawn on more
than ten years of experience in cadastre reform in the region. The PDO was of a standard
nature for countries moving from command to market economies. The components, too,
were relatively standard for this type of project, and the implementation arrangements
were straightforward, with responsibility resting with one agency that had a proven
record. Based on lessons learnt from the LARIS Project and preparation studies, the
project design focused on improving laws and operations, and supplying the necessary
equipment. In doing so, it was to support and promote reforms that would raise the
system to higher levels of security, efficiency, service and sophistication.
The Government had been actively engaged in the reform and development of real
property administration and market development for more than a decade, including
through the LARIS Project. The Government had adopted a clear program for legislative
and administrative change in 2004 that was consistent with best practice. A variety of
laws had been enacted and administrative reforms put in place. User groups were
consulted during preparation and the findings of the project preparation studies were
incorporated in the design. As indicated earlier, the Project initially covered support for
both the cadastre and registration services. Government commitment was high to
continue the engagement and dialogue with the Bank on land management issues. The
CA, being the more technical agency, was ready for Project implementation, while the
RRS had several legal and procedural issues to clarify before their final engagement in a
project. The complexity of integrating the two agencies only through the Project and
without a Government decision led the Government and the Bank to agree to split the
initial project idea and proceed with the support for the improvements in cadastre
services which were in an advanced stage of preparation, while the issues delaying
decisions on the registration services (then under the Ministry of Justice) were being
resolved. The CA officials were experienced and knowledgeable. Once the Project had
been approved by the Bank’s Board, the Government and the CA moved quickly to begin
implementation. Due to thorough preparation, the CA had a clear idea of its needs, and
once funds became available they were promptly disbursed.
The Project was to be implemented in 45 per cent of the country (by administrative
region), covering 40 out of 89 Subjects of the Federation (SOFs) in which there were
approximately 1000 municipal CA offices (out of 2300 nationally). For a list of the
16
regions, see Annex 10. The main reason for the restricted application of the Project was
the limited financing available: only US$100 million was available for the Project. The
valuation activity was also planned in four pilot areas. In this case, the limitation arose
from the fact that the project was assisting with design and testing rather than rolling out
the valuation system, which is currently being planned and which will be a task of major
proportions – covering more than 65 million properties and therefore one of the largest
property valuation exercises undertaken in modern times. It should also be noted that the
Project’s funds represented only a small part of the funding for the Federal Targeted
Program – for example, in 2007, the Program’s budget was in the order of US$250
million and US$170 million in 2011. The Government’s Federal Targeted Program
covered the other areas not covered with Bank funding.
Overall, project design was satisfactory. The preparation team tailored a standard,
successful model for improving real property administration and market development to
the local conditions. In doing so, the team drew on the long experience and informed
understanding of conditions in the Russian Federation, the capacity of administrators and
the needs of the public. Similarly, the Government team applied their professional skills
and knowledge to the design process to produce an ambitious but realistic project design
that accorded with Government strategy.
2.2 Implementation
The CA had a clear idea of what it needed; there had been thorough preparation, and the
Project was designed to meet the CA’s need and its capacity to deliver. Implementation
began promptly after loan effectiveness on December 21, 2005. A PIU was formed,
equipment acquired and installed, training conducted, and results began to emerge. Loan
disbursement figures confirm this: by January 2007, over US$30 million had been
disbursed, rising to over US$77 million by April 2008, that is, 28 months after
effectiveness.
Project implementation was generally without difficulties. Except as noted below, there
were no factors either outside or within the Government’s control that adversely affected
implementation. The nature of the largest component 2 - standardized equipment and
software – coupled with software development and installation and supervision by the
CA specialized information technology arm – facilitated quick disbursements once
agreement on the technical specifications and procurement processes were agreed. This
is despite a delay in the procurement process of the software development activity due to
the Bank’s questioning of the CA’s specialized agency (Zemlya) undertaking this
function. Ultimately, utilizing CA’s specialized IT agency ensured continuity, saved
funds and improved and maintained the capacity of developing and building on the
specialized land management IT systems. Government policies and commitment
remained steady, most of the necessary legislation was adopted, contractors performed
well, and major technical difficulties were rare. Although there were changes of
individuals in management and staff, those changes did not disrupt implementation.
Bank implementation support teams provided guidance as needed, but in general, the CA
and then RosReestr had the vision, capacity and determination to implement the Project.
17
The main area in which the CA and RosReestr required and received advice was modern
practices of land administration; advice from implementation support missions and study
tours proved to be highly valuable and fed into the design and implementation of land
administration activities.
There was no formal restructuring or other major changes to the Project. The Loan
Agreement (4800-RU) was amended (August 25, 2005) to reallocate funds from
Category 3 (Training) to Category 2 (Consultant Services and Audit). The Loan closing
date was extended to allow for ongoing contracts to be completed. The Government’s
decision of May 2008 (effective December 2008) to merge the CA with the RRS to form
RosReestr caused some delays in project implementation – mainly to accommodate the
restructuring of some related ongoing contracts such as for the legal framework and
software development. The Government moved quickly to appoint new management
personnel to continue the reform process. Management’s attention focused on the task of
bringing together some 6,000 offices and 46,000 staff, building a new management
structure, and dealing with strategic and administrative issues associated with a merger.
The legal ambit of the new organization, RosReestr, had expanded and thus the legal
framework had to be reviewed. This meant the Project work on developing legislation
was delayed while the new situation was assessed. Other Project sponsored design work,
particularly software design, also had to be revised to accommodate the changes. At the
same time, the bulk of Project funds had been disbursed and the equipment acquired,
installed and made operational. The impact of the reorganization was felt in deterioration
of some of the indicators reflecting the delays, the need for staff and management to deal
with the new environment, and new procedures to accommodate the merger, not to
mention the onset of the financial crisis. The Bank was supportive during this period; the
mid-term review mission of May 2008 noted that a delay was to be expected, but that the
new structure would provide an important opportunity to integrate Cadastre and
registration functions, something that the Bank had been advocating for many years and
which was consistent with international best practice. On the December 2008 mission, the
Bank team focused on advising how Project activities could assist in the integration
program. Budgetary restrictions arising from the 2008-9 financial crisis limited spending
on training, particularly study tours, but this had no sizeable impact on implementation
because the bulk of training had already been undertaken. Finally, the merger of the
three agencies (Cadastre, Registration and Cartography) into RosReestr was a step in the
right direction and well worth the delays and changes in the critical contracts (legal and
software development) to arrive at an optimal and timely solution.
2.3 Monitoring and Evaluation Design, Implementation and Utilization
Design: The PAD contains a set of clearly expressed monitoring indicators that focus on
more efficient services. Most of the indicators provide a quantifiable basis for assessing
progress in meeting the PDO. The results framework in Annex 3 to the PAD provides a
set of clear, specific indicators covering activities under each component, and the PAD
clearly envisages how the data would be collected, primarily through the CA’s internal
reporting system. As a check, a minimum of three contracts to monitor results and to
18
survey users were to be issued to verify the CA’s quantitative reports and provide
feedback on qualitative aspects of services.
Implementation: Initially, the CA did not follow the PAD’s result framework, noting that
there were various shortcomings with the approach (which were communicated to the
Bank team). Instead, the CA developed its own approach, which involved questionnaires
for clients covering satisfaction with time, quality of service, convenience of service and
level of awareness. The CA did not report on all matters covered in the results framework
in the early stages. However, during the mid-term review mission of May 2008, the Bank
team insisted that in addition to its own indicators, the CA needed to report on the Annex
3 indicators as part of the obligations under the loan agreement. Following that mission,
the CA began reporting on the Annex 3 indicators.
While some of the data came from the CA’s existing internal monitoring system, which
had been in place for many years, other indicators were new and specific to the Project,
such as the data for valuation methodology development and testing under component 3.
Additionally, data on client satisfaction was collected through three out-sourced client
surveys conducted in 2007, 2008 and 2009, with a follow up study in 2010 funded by
RosReestr. Around 5,000 respondents were questioned on quantitative and qualitative
aspects of the services of CA offices, and the results were comprehensively reported.
It is important to note that some indicators deteriorated or did not reach targets due to the
impact of the merger on one hand, but also as a reflection of the on the ground
developments in the real estate market as the financial and housing crisis was unravelling
worldwide (e.g. number of requests for information declined after 2008). Additionally,
the indicators do not adequately reflect the ease and speedier means of making
applications or requesting information through electronic means. For example, the client
was required to obtain documents and move them from one service to another, while now
this is done electronically and often without the need to physically visit offices.
As to sustainability, the Project is built on the CA’s reporting system, which remains in
place and continues to provide statistics. To this extent, there is no doubt as to its
sustainability. Client surveys of the type sponsored by the Project, too, will continue into
the near future under the Bank-sponsored Registration Project, which is being
implemented by RosReestr. By the Project’s end, there was greater acceptance of the
client survey approach to monitoring, and there appears to have been some cultural
change within RosReestr.
2.4 Safeguard and Fiduciary Compliance
The Project did not involve safeguard policies. The Project financed the purchase of
equipment, hardware and software as well as studies, and therefore there was no direct
impact on safeguards. The Project did not finance any cadastre measurements or
registration which is done on a selective sporadic basis in Russia. There was a small
amount of proposed office repair, which was rated at category C for Environmental
Assessment.
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The financial management (FM), disbursement and procurement staff within the PIU
performed capably and all audits had a clear opinion. The FM system recorded all
transactions and balances, and it permitted clear and concise reports to be promptly
issued. Internal controls and audits further ensured the accuracy of records. No fiduciary
issues were raised, and questions raised during site visits were corrected satisfactorily
(e.g. tracking inventories). The FM and procurement functions were rated as satisfactory
throughout the Project.
2.5 Post-completion Operation/Next Phase
The outcomes of the Project have been incorporated in RosReestr’s day-to-day
operations. The improvements to the legal framework, data processing and storage,
communications, and information exchange are now part of the RosReestr system
including in the Subjects of the Federation (SOFs) not included under the Project. The
centralization of services and processes is due to be finalized at the end of 2012. The
Government increased emphasis on continually improving data quality and services in all
SOFs as well as continuing to improve the legal framework by studying international best
practices. The valuation procedures and software developed and tested under the
Project will be used in other SOFs. RosReestr has its own experienced staff to improve
operations and services. It continues to do so under the Federal Targeted Program
including a second phase starting in 2013 onwards, which is currently being developed by
the Government. RosReestr is an energetic, modern and forward-looking organization
with the capacity to sustain and build on the Project’s achievements to continue its
program for improving land administration. Thanks in part to the Project study tours, it
has become a more outward client focused organization, with a better understanding of its
clients’ needs and desire to meet those needs, including through provision of information.
A move to a self-financing status would give it greater financial autonomy and possibly
avoid some of the restrictions on financing imposed by the Federal Government, such as
restrictions on training budgets.
Performance indicators by which the Project can continue to be monitored and evaluated
in the coming years are along the lines of those in Annex 3 to the PAD – reduced time
and steps in the registration process, better information exchange and access, increased
client satisfaction, access to more and better information for clients, and higher staff
productivity. The CA monitoring system continues in place, and the Registration Project
requires client service surveys to be conducted. The Registration Project shares or has
similar indicators to those of the Cadastre Development Project. Additionally, the success
of component 3 on valuation methodology will facilitate the introduction of a modern
property taxation system, planned by the Government to begin in 2013. Applying
international valuation standards and using mass valuation improves the reliability of the
valuation system, and the appropriateness of the values it produces, and its ease of
operation and acceptance when it is introduced across the country
Follow up by the Bank is in place through the Registration Project. The activities under
that project were originally planned to be combined with those under the Cadastre
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Development Project. Activities under the Registration Project, which is due to run to
May 2014, are building on the outcomes of the Cadastre Development Project and should
result in further operational improvements of the kind already achieved. Specifically, the
Registration Project seeks to provide clients with greater and better information, improve
client satisfaction, reduce the time for registration, and improve staff skills and
productivity. These are very similar to the indicators under the Cadastre Development
Project, and they reflect the fact that the two projects were prepared together and deal
with similar services. Now that RosReestr is responsible for both cadastre and rights
registration work, and staff have wider responsibilities, the Registration Project should
support the reform momentum and sustainability of the results already achieved. The
extent to which this is the case can be monitored over the next three years of the
Registration Project and in a follow up evaluation two to three years after the Registration
Project has closed.
3. Assessment of Outcomes
3.1 Relevance of Objectives, Design and Implementation
Improving land administration through a reliable and efficient Cadastre system has been a
high priority for the Government throughout implementation and remains so at
completion. The Country Partnership Strategy for 2007-2009, which was extended to
2011, is built on four pillars – sustaining rapid growth, improving public sector
management and performance, improving the delivery of social and communal services,
and enhancing Russia’s global role. The Project has provided firm support for sustained
economic growth through improved information flows, greater certainty and consistency
of processes and outcomes, and improved transparency and efficiency of the land
administration system. Opening the market for technical inventories to the private sector
and removing the obligation to obtain a technical inventory for secondary transactions
(sale, mortgages, etc.) removed restraints on market operation and efficiency.
The Project promoted public sector management and performance through improvements
to operations, resources, training and management. The Project has even contributed to
improving the delivery of social and communal services by providing more reliable and
accessible property data that governments need when planning and delivering services in
the physical setting. Further, the system for property valuation, which is linked to tax
collection, should provide a basis for collecting taxes that fund local government
services. Thus, the Project’s objectives had high overall relevance throughout.
In retrospect, the positive outcomes verify the relevance of the design and
implementation of the Project despite initial questions regarding splitting the initial idea
of having the Project address both Cadastre and registration services. The Project was
then timely in terms of responding to the CA commitment and to the Government’s
desire to continue dialogue and improvements to the sector despite internal
inconsistencies that needed time to be resolved on Russia’s own terms. The team’s
support, based on ongoing experience in Europe and Central Asia region (ECA), for the
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Government’s insistence to have CA’s specialized IT arm to continue to take the lead in
developing and updating software paid back handsomely in time and funds as well as in
supporting and enhancing the capacity of the very important IT function in land
management and the CA.
3.2 Achievement of Project Development Objectives
The PDO was to improve the information flow and to rationalize the normative and
operational procedures for the cadastre system. In doing so, the Project was to:
Facilitate the development of real property markets;
Improve the quality of services provided by CA offices; and
Strengthen linkages with other related organizations, including rights registration
offices, tax authorities and municipalities.
The Project focused on the improvement of the quality of services through the review and
rationalization of existing procedures. In the process, unnecessary and sometimes costly
steps were removed (e.g., the requirement for a survey for secondary transactions was
eliminated). The average time clients spent to obtain cadastre information, to obtain a
cadastral survey or to complete a transaction in immovable property was reduced by
almost half in all cases. This was accomplished through the cadastre offices acting as one
stop shops, eliminating the need for clients to coordinate between offices (previously
with BTIs) and providing clear information and queuing services in the offices. The
CA’s IT strategy aimed to integrate the cadastre (and now registration) offices vertically
across all SOFs as well as to integrate horizontally cadastre and registration with other
government offices such as municipalities and taxation offices. This was accomplished
in legislative procedures as well as the IT system, and further strengthened with the
integration of the services in one agency. Further work is expected to continue for the
proposed National Spatial Data Infrastructure to provide data access to society at large.
With regard to the development of real estate market, it is difficult to directly attribute the
impact of the Project on real property markets given the many other factors that impact
such a market as the recent financial crisis has shown. Nevertheless, the Project
facilitated this development by simplifying procedures and improving transparency and
accuracy. The Project was timely in responding to pent up demand for property
transactions (sales, leases, inheritances) and provided the means for implementing these
transactions in a more secure and trusted modern system. More than half of one million
information requests were processed in 2011 above the figure for 2007 and reflect the
increased demand for the services of the CA in response to developments in the property
market.
The Project was also to achieve seven intermediate outcomes. Some of these objectives
were fully achieved or surpassed, while others were partially achieved since they did not
meet the targeted level. The Project managed to significantly improve the information
flow through analysis, software design and development, acquisition of software and
hardware, and implementation and accompanying training. Time for processing new
property surveys was reduced from 2 months to 1 month, but did not reach the target of
22
two weeks. The requirement to obtain a cadastral survey for secondary transactions was
costly, cumbersome and unnecessary. This step was removed, but was not sufficient to
reach the target of removing 2 out of the 4 steps. The target of increasing productivity of
staff was not met, staff numbers increased in some years, and the learning curve for the
new system was sometimes blamed for the decreased productivity in these years. Targets
fully met include the property valuation pilot; in the area of developing and testing
valuation software, the Project far exceeded original expectations by including Moscow
city in the pilots, which resulted in another five million properties being valued, and by
funding an extensive socio-economic study on property taxation. Overall, by 2011, a
modern, centralized system for acquiring and disseminating cadastre data existed in all
SOFs supported by the Project and in most of the remaining SOFs. The normative and
operational procedures were reviewed, (re)designed and implemented. A clearer, more
comprehensive legal framework and more sophisticated operational procedures had been
created, which made processes more predictable, certain and transparent.
3.3 Efficiency
The economic analysis of the project outcomes follows the approach adopted in the PAD,
where time savings were calculated for (a) processing transactions; (b) visits to Cadastre
offices. Additionally, monetary savings from eliminating the survey requirement in
secondary transactions were also calculated. Other benefits due to faster access to more
reliable data by investors, real estate professionals and other government agencies are
more difficult to quantify. While the PAD did not calculate an ERR or net present value
(NPV), this analysis shows that the Project resulted in an NPV of US$132 million during
the life of the Project. If the Project benefits continue for 15 more years, NPV would be
US$692 million assuming a discount rate of 10%, and an ERR of 24% is achieved.
(Annex 3).
During the life of the Project (2006-2011), approximately 122 million transactions of
various types were recorded in Russia, and the Project covered about 45% of CA offices.
However, some benefits of the Project (streamlined procedures, regulatory changes,
software development) accrue to all the CA offices. It is difficult to attribute the increase
in transactions processed solely to the Project’s success because property markets are
influenced by many other important variables in the economy that cannot be isolated.
However, we can attribute the savings in specific efficiencies due to Project activities as
well as savings to the client due to elimination of the technical inventory for secondary
transactions requirement.
In terms of increased efficiency, the PAD notes that savings in transaction times, fewer
visits to the Cadastre Agency (CA) offices, improved efficiency of staff members and
shorter times spent by clients at the CA offices would be expected outcomes of the
project activities. The Project results validate and exceed the PAD assumptions: the
reduction in the average time for processing new property surveys by the Cadastre
Agency decreased from 1 month in 2007 to 20 working days in 2011. The average time
for completion of transactions in immovable property reduced from 35 days and 29 days
in 2007 to 19.6 days and 19.4 days for individuals and legal entities, respectively. There
23
was reduction of 9 minutes in the average time a client spends in the Cadastre Agency per
visit from 57 minutes in 2007 to 48 minutes in 2011; a reduction of 36.8%. Compared to
2004 data when the client spent an average 120 minute each visit, there was a 63.8%
reduction in time spent at the CA. The average wage rate of $810 per month was used to
monetize these savings (July 2011 Rostat/Russian Economic Report).
The requirement for a technical inventory for secondary transactions, which was the stage
eliminated, amounted to large savings for members of the public. Costs for technical
inventory increased from USD 20-50 at the time of appraisal to a reported USD 160 for a
building and USD 270 for land (in the Moscow area). Using a conservative estimate of
USD 50, and assuming that only five percent of those transactions are related to
secondary transactions, then a minimum of USD 67.5 million were saved in 2011 alone
from the elimination of the technical inventory requirement. Multiplied across the life of
the Project, the figure rises to nearly USD 340 million saved during the life of the project
arising from the elimination of technical inventory.
There are other benefits associated with improved access to cadastral information that are
more difficult to quantify, including the savings by other public and private users of
cadastral data who now have faster access to more reliable data for important investment
or policy making decisions as a result of Project activities. The number of information
requests increased 60% from 916,155 per year in 2007 to 1,463,974 per year in 2011.
Investments in Cadastre and registration systems improve access to finance and other
investments in the housing market for example. RosReestr introduced online access to
certain information, which was facilitated through Project sponsored software, hardware
and communication systems. Since the introduction of this on-line access in mid 2010,
daily requests have risen to 6,000 and continue to grow rapidly. The Project has laid the
foundations for further expansion in formation and access to spatial data for
improvements in urban and spatial planning as well as other e-services. The government
has recently allowed financial institutions to accept electronic documents, and it is
expected that notaries in Russia will soon follow suit in line with the modernizing trend
of reliance of e-documents and transactions throughout Central and Eastern Europe. It is
also expected that removing services from local offices to the central Oblast level office
has diminished opportunities for corruption.
3.4 Justification of Overall Outcome Rating
Rating: Satisfactory
The development rationale for the Project remained highly relevant throughout
implementation and continues to be relevant under the proposed 2012-2016 Country
Partnership Strategy (CPS). The CPS includes continued support to the Government’s
efforts to improve management of public finances, investment climate and innovation as
well governance through higher transparency, accountability and improved service
standards – themes that are also inherent in the Project.
The Project succeeded in delivering the activities planned, and in some cases did more
than was planned, particularly in terms of valuation pilot work. The Project assisted to
24
put in place legal and operational frameworks, supplied state of the art hardware and
software, introduced measures to improve clients’ experiences and perceptions of the CA
offices, and raised the professional skills and knowledge of many staff. As a result,
greater efficiencies were introduced to the operation of the property market, information
flowed more easily and quickly, and services were improved. Further, the Project’s
outward focus on linkages with other agencies facilitated the merger of the CA and
Rights Registration Services (RRS) in 2008. The Project helped to create a launching pad
for RosReestr to move to a modern Cadastre system, comparable to those found in
Europe. And component 3 has created a reliable and effective foundation for a market
based property tax.
However, there were some shortcomings in achieving some indicators, largely due to the
disruption caused by the merger. There are largely no shortcomings in the Project’s
achievement of its objective, in its efficiency, or in its relevance. The Project managed to
achieve these results and outcomes for what is, in a country of the size of the Russian
Federation, a relatively small sum. This investment has ensured large current and future
savings, and it has delivered the infrastructure for delivering sizeable future fiscal gains.
3.5 Overarching Themes, Other Outcomes and Impacts
(a) Poverty Impacts, Gender Aspects, and Social Development
The Project did not specifically target these social objectives. However, given the very
high levels of private ownership of dwellings in the Russian Federation (over 70%), the
Project’s many positive outcomes have flowed across the nation. Overall, the Project
contributed to facilitating the development of the real property market by providing
security of ownership and making it easier to transact property. In addition to improving
the climate for investment, the system will facilitate citizens’ access to the liquidity
through their properties, and use this liquidity for other more productive needs.
(b) Institutional Change/Strengthening
The provision of the new information technology and communication systems facilitated
the Government’s centralization program, which has changed the nature of how
RosReestr does business, and created an environment of reform and greater possibilities.
The move to centralized processing has raised standards nationally and made RosReestr a
more robust organization. The new subsystem has permitted innovative managers and
staff to develop new or better services in addition to those envisaged under the Project,
such as the online services introduced in 2010.
A further factor in terms of institutional change has been the development of a greater
client service focus. In addition to Project funded reforms, RosReestr has sought to
improve clients’ experience through renovated client areas, more respectful attitude to
clients, better information and more services. These changes have also improved working
conditions for staff, as clients are more informed and better able to ask for specific advice,
thus encouraging a more cooperative approach. Further, it appears that the Project’s client
25
surveys of 2007, 2008 and 2009 may have reinforced this cultural change, and it is
encouraging to see that RosReestr used its own funds for the 2011 survey and plans to
continue with such surveys. Overall, management and staff see clients in a more
receptive and accommodating light.
A major factor-giving rise to the improvements and changes of attitude has been the
foreign study tours in which managers and staff were exposed to new ways of operating
and serving clients. Building on an open and receptive attitude to international experience,
the exposure to foreign systems challenged old ways of doing business while opening
new horizons, particularly in newly developing areas such as national spatial data
infrastructure. Participants became aware of positive trends in Europe and elsewhere.
Also, the tours and conference attendance has assisted the Russian Federation in
becoming more integrated in the international land administration community.
(c) Other Unintended Outcomes and Impacts (positive or negative)
The merger and integration of the Cadastre, Registration and Cartography services was
not planned in the Project due to the difficulty of influencing through the Project a
decision with complex political-economic background. Nevertheless, discussions on the
structure of land related services with the Bank, as well as through training and visits,
continued during implementation. The Government’s decision to integrate the services
had a major positive outcome that strengthened the PDO. Among the benefits cited by
the Government and experts of a unified Cadastre agency are: (a) establishment and
reference to one data set, one data source, and a one stop shop for customers therefore
avoiding duplication of efforts or contradiction in data; (b) a standardized and integrated
ICT architecture where new modules and services could be added more easily; (c)
integrated maintenance and upgrading with lower costs leading to a system that is easier
to run and update; and (d) integrated facilities (buildings, equipment) with lower capital
and operational costs. On the other hand, it is noted that with a unified agency, more
attention is needed to ensure checks and balances are in place when the administrative
and legal duties are also integrated.
3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops
There was no beneficiary survey or workshop at the end of the Project.
4. Assessment of Risk to Development Outcome
Rating: Negligible to low
The Project achievements of improving information flows, clarifying the regulatory
environment and improving operations are fully integrated into RosReestr and its
operations. They have assisted RosReestr to achieve the outcomes of the Federal
Targeted Program, particularly in relation to centralization. The integration of Project
achievements into RosReestr’s operations follows directly from the nature of the Project
– it was an integral, although small, part of the agency’s activities and operations. The
26
Project was located within a larger program in an administrative unit that was working
towards the same type of outcomes as those envisaged in the Project. Given the
Government’s strategy for land administration and RosReestr’s mandate to implement
that strategy, it is hard to imagine changes that could be detrimental to the ultimate
achievements of the Project’s development outcome, other than the Government
abandoning altogether its plans for a modern, efficient land administration system that
facilitated market activity. The chance of such a departure from current policy is
negligible. Increase in property prices, an expanding mortgage market, advances in
technology and greater integration both in Europe and the global economy will only
support the current path that the Government and the Project have pursued.
The only potential risk relates to the need to replace and update equipment and systems,
which are almost fully utilized now. This risk has been recognized by RosReestr and
provision for funding is included in RosReestr’s budget. Thus, overall, the risk to the
development outcome appears to be low.
5. Assessment of Bank and Borrower Performance
5.1 Bank Performance
(a) Bank Performance in Ensuring Quality at Entry: Satisfactory
As noted previously, the Bank team was well experienced and knowledgeable, and
applied a successful model to local conditions. The team worked closely with equally
knowledgeable counterparts to tailor Project activities to meet the PDO. There were
economies of scale in developing the Project as several team members were involved in
the LARIS project.
Perhaps the only criticism would be that preparation was expensive and time consuming:
almost US$500,000 was spent on preparation (according to the PAD) and there were
eight missions from identification to pre-appraisal, although the missions were joint
missions with the LARIS project.
(b) Quality of Supervision: Satisfactory Bank supervision missions visited on a regular basis. They generally provided
appropriate and well-targeted supervision, advice and observations. Issues requiring Bank
attention, including the merger and critical procurement items, were attended to. In
dealing with the merger, the Bank team was constructive and accommodating, and
facilitated the extension. The Bank team closely monitored the fiduciary aspects of the
Project through semi-annual reviews.
Greater attention and follow up actions were needed to ensure meeting the indicator
targets in Annex 3 to the PAD. Several reforms were delayed in 2008/2009 and greater
pressure from the Bank team could have helped re-focus RosReestr on meeting those
targets.
27
(c) Justification of Rating for Overall Bank Performance: Satisfactory The Bank’s performance was adequate to the tasks and facilitated the success of the
Project.
5.2 Borrower Performance
(a) Government Performance: Satisfactory The Government provided firm and prompt support to the Project. As the Project
supported the Government’s own strategy, there was a strong commitment through the
design and implementation phases. Regulatory changes were adopted relatively quickly.
While the Government’s decision to merge the CA and RRS caused some delays and
revisions to established procedures, administrative changes of this kind are not
uncommon elsewhere in the land administration sector. Ultimately, the Government’s
decision to integrate these services was in line with best practice yielding substantial
long-term benefits. The Government continues to support and cooperate well with the
Bank under the Registration Project.
(b) Implementing Agency or Agencies Performance: Satisfactory The activities under the Project were well designed and implemented by the CA and then
RosReestr. The CA established thematic groups for each of the areas addressed by the
Project. The thematic groups consisted of members knowledgeable of the subject and
were responsible for drafting terms of references for studies and supervising the quality
of the consultant work to ensure they are responsive to the Government’s needs and
vision for land administration in Russia. As noted, the agency had the vision, capacity
and determination to implement the Project, and cooperated with the Bank to ensure that
the Bank’s requirements were addressed. The PIU included sufficient number of qualified
procurement specialists. There were no major violations of procurement rules found
during post review missions. Goods and services were delivered on time, and related
payments were effected fully and on time. The Project was rated as satisfactory over the
entire period.
(c) Justification of Rating for Overall Borrower Performance: Satisfactory The Government, the CA, and RosReestr performed well in designing and implementing
the Project. This is partly due to the close alignment between the Project’s PDO and the
Government’s strategy to create a modern land administration system. The design and
implementation of the Project relied on the specific expertise in RosReestr that dealt with
the subjects through the thematic groups. These groups also provided the commitment
and continuity throughout the Project preparation and implementation. The majority of
the Project indicators were met due to reforms introduced either by the Government or
agency, and the individuals involved in the Project were enthusiastic and very capable.
While changes in personnel and the integration created some disruption in capacity and
focus, the agency returned to the tasks of implementation relatively quickly.
6. Lessons Learned
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Government Commitment, Strategy and Institutional Change. The Bank team adapted a
tried and tested successful model of land administration projects to the realities of the
Russian Federation. In this case, the Bank trusted the commitment of the CA and the
Government’s support for the land administration strategy, and agreed not to wait for
further reform on the structures of the responsible agencies (i.e. integration of land
administration services as a condition for the Project). The Bank therefore agreed to split
the original idea of the project to address both the Cadastre and registration services, and
went ahead with the Cadastre Development Project, which was ready for implementation.
The Registration Project was delayed, approved in 2006 and became effective in 2008.
The Bank agreed that Russia needed time to sort out the restructuring but needed not
delay the start up of implementation of the strategy. In this case, rushing significant
institutional change in a country as complex as Russia would have caused major delays.
Discussions on the best model for the agency continued during implementation, and more
importantly through training and study visits while other internal discussions were taking
place. Where the commitment for the strategy on the part of the Government is clear,
such an approach would yield better and timely results.
Single vs. Separate Land Administration. The Russian Federation selected the single
agency model for land administration. This is an approach that was recommended by the
team based on its experience in the ECA. The study visits provided the government
counterparts with practical experiences and exposures to the different types of agencies
and helped them to make their decisions.
IT and Software Development. In high capacity countries such as Russia, the Bank team
was correct in supporting the Government’s strategy on implementation of the IT strategy.
This is particularly clear when the Bank agreed during preparation that the CA’s existing
specialized IT department should continue to be responsible for the development,
upgrading and installation of the software. The team’s experience in other countries led
to this support. This approach was responsible for savings in time and funds as well as
sustained and improved technical capacities in the CA. The alternative of introducing an
outside software developer firm would have required more time to study and understand
the existing system and would not have likely led to the increased capacities and
understanding of the system, not to mention the longer time needed for an outsider to be
recruited. The Bank should make clear the conditions of utilizing existing IT
departments to avoid delays during implementation due to Bank procurement rules that
favor competition.
Bank-Russia dialogue. The majority of the loan funds were provided for hardware and
software purchase and installation. The amount of the loan was only a small portion of
the Government’s targeted program for land administration. The strategy and direction
of the Project were already selected by the CA and the government. The Bank’s role was
to provide advice, dialogue and a menu of alternative approaches to be studied and
selected by the Government. The experience of the Project indicates that Government
counterparts are more interested in the intellectual support, training, exchange of
experiences and implementation discipline through clear guidelines and monitoring, as
provided by the Bank’s project, than in the funds that the Bank can provide. This is
29
becoming more evident in the overall Bank’s relationship with Russia and other countries
in the ECA region, where fee based services and knowledge exchange are becoming as
important as lending in the country programs.
Bank flexibility on Closing Dates. The team’s support for the merger and the consequent
Bank agreement to extend the loan closing date to accommodate the merger and the
adjustments needed of the legal and software development contracts was the right
approach that was highly appreciated by the Government. At the end, and despite delays
and lack of complete clarity, the Bank remained a partner in the advice and in the
Government’s correct decision to merge the related services for the long-term benefit of
RosReestr and its clients.
7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners
(a) Borrower/implementing agencies The Borrower decided not to provide any comments.
(b) Cofinanciers
(c) Other partners and stakeholders (e.g. NGOs/private sector/civil society)
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Annex 1. Project Costs and Financing
(a) Project Cost by Component (in US$ Million equivalent)
Components Appraisal Estimate
(US$ millions) Loan Funds
Actual/Latest
Estimate
(US$ millions) *
Percentage of
Appraisal
I. Institutional Development of the
Real Estate Cadastre 8.178 6.137 75
II. Cadastre System Interrelations 102.696 98.268 96
III. Real Estate Taxation
Development 13.506 14.121 105
III. Project Management and
Monitoring 4.590 4.612 100
Total Baseline Cost 128.970 123.138 95
Front End Fee 0.500 0.500 100
Total Project Costs 129.470 123.639 96
Total Financing Required 129.470 123.638 96
* As of November 2011
(b) Financing
Source of Funds Type of
Cofinancing
Appraisal
Estimate (US$ millions)
Actual/Latest
Estimate (US$ millions)
Percentage
of
Appraisal
Borrower Joint 29.47 24.063 82
International Bank for Reconstruction
and Development Joint 100.00 99.575 99.6
Total 129.47 123.638 96
31
Annex 2. Outputs by Component
Component 1. Institutional Development of the Real Estate Cadastre.
This component consisted of four sub-components:
1A. Improvement to the Legislative and Regulatory Framework
The objective of this sub-component was to establish a regulatory framework more
conducive to the operation of real property markets, through development of a set of draft
laws, amendments to laws, regulations and manuals that would facilitate efficient and
secure market operations.
The output of this sub-component was a lengthy set of draft regulatory materials. These
were developed under the CA’s, then RosReestr’s, thematic group on Development of
Regulatory and Legal Framework. The work was assisted by external consultants, over a
23 month period from March 2008. Work was suspended during the period of the merger
with the RRS to assess the new organization’s needs, and thus work was finalized in the
second half of 2010. The contract was primarily aimed at developing implementing
regulations, as the key law regulating this field – the Federal Law “On the State
Immovable Property Cadastre” (No. 221-FZ) – had been adopted in July 2007. This law,
which was implemented by January 1, 2010, required many regulations, and the Project
funded the drafting of some 24 draft regulatory documents to meet this need.
The draft regulatory documents were submitted through RosReestr to the MOED, which
is the body responsible for legislative activity in this area. Three of the draft documents
were divided into separate documents by the MOED, so that ultimately there were 29
documents. Of these, 22 were in the form of orders of the MOED, four were resolutions
of the government, one was a draft law and two were ultimately not required. By July
2011, 16 of the orders and government resolutions had been adopted, with the remainder
still being considered by the MOED.
The adoption of these regulatory documents has resulted in greater clarity and certainty in
the law regarding the details and implementation matters under Federal Law No. 221-FZ
in the areas of:
surveying and measuring properties, establishing boundaries;
preparation of plans and related documents;
the format of information produced by RosReestr;
rules on submission of electronic applications; and
the transfer of data into the real estate cadastre.
In addition to the contract to draft regulatory documents, the CA and RosReestr have
pursued improvements to the legal framework over the Project period through the
thematic working group responsible for legislation. Key amongst these was the Federal
Law No. 221-FZ, which established the broad legal framework for the cadastre, and also
32
included provisions for licensing surveyors, greater automation and e-services.
Legislative advances were also made in areas such as the elimination of the requirement
for a technical inventory for secondary transactions, as noted above.
The overall outcome for this sub-component is firstly, greater clarity and certainty as to
the rules and requirements for using and operating the cadastre and registration system.
This assists in delivering uniform services and ensuring predictable results for clients.
Further, removal of some restrictions (such as on private surveyors) and obligations (such
as the requirement for technical inventory) have freed up the market. Thus, sub-
component 1 has delivered positive outcomes in terms of transparency, security and
market efficiency.
1B. Transformation of the Land Cadastre to the Real Estate Cadastre
This sub-component consisted of two parts – (a) re-engineering of existing software to
improve links between CA offices and other institutions at the local, regional and federal
levels, resulting in detailed terms of reference for the development of the main cadastre
communication system; and (b) development of a strategy and business plan for
implementing the new information and telecommunications systems.
Work on part (a) – improving links between the CA and other local, regional and federal
institutions - was undertaken in 2007-2008 to diagnose, review and make proposals for
changes to the procedures and software. The consultants prepared a set of proposals
covering organizational and regulatory matters, software, hardware and training. Results
of this sub-component were incorporated into the software development and
implementation work under component 2, particularly 2B (see below). As part of this
contract, a comprehensive training needs assessment was also undertaken, as the
proposed system would result in significant changes in the organizational structure,
functionality and skill required at all levels of the organization. The assessment was to
inform the CA of the changes required and to assist in identifying staff with the skills for
re-assignment, as well as provide the basis for future training courses. Although not
designed for this purpose, the assessment became useful in managing the 2008 merger of
the CA and RRS.
Work under (b) – development of strategy and business plan for the IT systems – resulted
in the adaptation of Government Decision of September 13, 2005 No. 560 on adoption of
sub-programs on immovable cadastre system (2006-2015) and within the Federal
Targeted Program on the creation of automated system for the land cadastre and the
immovable cadastre (2002-2008) to the new requirements of the merger of the cadastre
and registration services. The final outcome after the merger was a new ICT strategy
approved by MoED (No. 534/December 18, 2009) in the “Concept of Creation of an
Integrated Federal System of State Registration of Real Property Rights and State Real
Property Cadastre. The IT strategy is continually monitored and adapted to new
developments and needs of IT in the cadastre and registration services.
1C. Development of Services for Clients and Authorities
33
This sub-component sought to improve the quality of services delivered to clients through
the provision of information in the CA offices, particularly through improved client
services areas with notice boards and pamphlets and also through a series of publications.
By May 2008, improving clients’ conditions had progressed well using the CA’s own
funds. Every office visited by the mid-term review missions and subsequent supervision
missions achieved good standards for client reception facilities, provision of information,
organized reception procedures (including ticketing systems) and work flow procedures
that would minimize opportunities for corrupt practice. Other innovations related to the
renovations included the use of queue ticketing machines, provision of desks and seating,
provision of cash machines and banking services, and standardized signage. As this
activity was undertaken using government funds, no Project funds were required. To the
extent that there was information produced for the public, this too was provided under the
budgets of the CA and RosReestr.
The main activity under this sub-component was the development of a strategy for
providing client services. Under a contract dated September 2007, the consultants
developed a “Strategy for Enhancing Quality and Growth”, which covered improving
services for clients, internal processes, finances and staff knowledge and skills. Specific
proposals were presented to achieve improvements in each of these areas covering:
reorganization of processes for serving clients;
information structures and content for different categories of clients;
dissemination of information for different categories of clients;
changes to the legislative framework;
management and organizational change; and
establishing benchmarks for service.
Many of the consultant’s recommendations were accepted and incorporated in the new
software system.
1D. Improvement of Professional Skills of the Real Estate Cadastre Staff
The aim of the sub-component was to upgrade the knowledge of the CA staff, including
in relation to new activities and new software envisaged under the Project, and thus
provide better and more efficient services.
The outputs were as follows:
over 2008-2009, 1872 specialists of the CA were trained under the main training
contract in eight courses covering legal matters relating to cadastre and
registration, technical matters, corporate ethics and client service, software
operation and valuation;
from 2008 to 2010, 331 specialists were trained under other smaller, separate
contracts;
34
from 2006 to 2009, 297 specialist received training by means of 23 international
study tours, conferences and seminars. The study tours are discussed further
below.
Thus, a total of 2,500 people were trained under the Project. The number would have
been slightly higher but the MOF suspended all study tours from 2010 onwards as part of
cost saving measures. Training sponsored by the Project complemented training provided
by the CA and RosReestr under their budgets, so the above numbers indicate only a part
of the training supplied to staff.
The Project sponsored the creation of eight technical training courses for specialists of
the CA. Training courses were conducted face-to-face in four regional training centers
across the country which had been established under the LARIS Project. The Project
supplied not only the training courses and associated materials, but also supplied
computers and other equipment (projectors, electronic whiteboards) for 11 training
centers. Participants’ responses to the questionnaires issued after each course were rated
to be highly positive.
The Project funded the creation of a distance learning system. By the end of 2008, an
extensive set of training materials had been made available on the RosReestr intranet, and
training of trainers was completed. The topics covered law, cadastre operations, valuation,
planning, archiving and preparation of reports. A comprehensive training needs
assessment was undertaken to address current skills and knowledge, and to identify future
training needs.
Study tours, conferences and training courses took participants to Australia, Austria, Italy,
Lithuania, Netherlands, Spain, Sweden, UK and USA. Topics included:
structure, function and information content of overseas property cadastre systems;
comparative analysis of existing systems and technologies;
analysis of various overseas real estate appraisal systems taxation, cadastral
appraisal of land activity; the institution of tax appraisal;
international systems of legislations regulating land cadastre maintenance and
land law; legislative regulation of relations between central and local government
authorities in the area;
modern technologies of mass training; remote training; electronic textbooks and
computer training programs;
international experience in cadastral information automated systems; maintaining
E-archives; protection of information;
providing client information and services;
modern technologies for forming and developing professional competency with
the staff of cadastre bodies; and
project management, financial management and procurement.
35
The participants were required to provide a report of their findings and each hosting
organization was required to provide detailed information. As a result, a large body of
information and experience has been collected and is available on the RosReestr intranet.
The outcome of the training activity has been an increase in the knowledge and
understanding of not only the Russian system but international systems, particularly
European systems. A large body of material serves as a resource for future needs, and the
distance training system will provide low cost training opportunities for regional staff for
many years. Most importantly, training has equipped staff to operate the new software
and communications systems, which have greatly improved the flow of information.
Training has helped to improve uniformity and predictability of services and results, and
a knowledge base has been created for future development of the system along the lines
of international best practice.
Component 2. Cadastre System Interrelations
There were two sub-components under component 2, as follows:
2A. Development of the Information and Communication Subsystem
This sub-component was allocated the bulk of Project funds, although it represented only
a small supplement to the CA’s own budget. The objective of the sub-component was to
develop several applications for information exchange between offices and to acquire the
communications infrastructure, hardware and software licenses necessary to implement
the improved system, and also to provide shelving for paper archives. The aim was to
deliver rapid and efficient access to cadastre information from any part of the country, as
part of the program of centralizing CA operations, thus facilitating market operation and
property tax implementation.
Under the centralizing program, all CA services for a SOF (oblast/republic/city/etc.) were
to be performed at one location in that SOF, with the local rayon level offices providing
front office services (lodgment, collection, archiving). All processing was to be
performed at the SOF center, with applications being received and results being
dispatched electronically to local offices. This system is now largely in place across the
country.
The primary outcome of this sub-component was, as described in the PAD, the
development of software and the acquisition of hardware and software licenses. Software
was developed to improve the automated information system of the real estate cadastre
and the document management system under relatively small contracts. Equipment and
licenses were covered by six of contracts to a value of approximately US$80 million. The
equipment and software were installed in the 40 regions under the Project at the CA
regional center, the Land Chamber and the rayon level offices (the number of which
varies from region to region). The Project funded over 500 servers, 5,300 monitors,
17,200 IP phones as well as printers, plotters, scanners and communications equipment.
36
As a result of activities under the sub-component, RosReestr was able to implement the
program for centralizing operations in all the SOFs covered by the Project. As envisaged,
Project activities have greatly improved information flow and communications, and the
program for centralizing services for each SOF has improved quality of service,
consistency and predictability of outcomes, which are factors in increasing transparency,
security and market efficiency. Citizens can now obtain cadastral information for
properties in any part of the country from their local office. The transfer of operations
from local offices has also removed some opportunities for petty corruption.
Shelving was acquired for only one office. As the Registration Project, which came under
RosReestr’s jurisdiction in 2008, has a substantial focus on archives and their
management, paper archiving is being addressed using funds from that project.
2B. Information Exchange with Systems for Registration of Rights
Sub-component 2B sought to develop an application to link the MOJ’s RRS with the
CA’s cadastral system, introducing remote access to information and thus making the
operation of the two agencies and the real property market more efficient.
The primary activity under this sub-component was to be the development of software
linking the two systems. With the merger of the CA and RRS in 2008, the organization
circumstances changed, but the need to link the two systems had not altered – in fact, it
became more urgent and important. Under one main contract, an automated system for
linking the CA and RRS was developed over four stages. The contractor developed and
tested the software, and conducted training in its use.
The work under this sub-component has laid the foundation for the full operational
merger of the cadastre services and rights registration services. As noted above, a
combined cadastre and rights registration authority is consistent with best practice; this is
primarily due to increased efficiency and greater alignment between the records of a
property’s identity and rights associated with it, particularly in paper based or transitional
systems.
Component 3. Real Estate Taxation Development
This component sought to facilitate the introduction of a value based tax on real property,
thus providing revenue to local government, through introduction of (a) a system of mass
appraisal of property; and (b) a market monitoring system to benchmark property
appraisals. The appraisal system was to be tested in four pilot areas during the course of
the Project. The Government financed the introduction and testing of the valuation
program in 7other areas of the country, and rolling out the systems nationally is planned
to be completed by 2013 and prior to the introduction of the property tax law.
The results of component 3 were:
37
development of software for computer assisted mass appraisal (CAMA), based on
an internationally acceptable methodology, which included training for staff in the
use of that software (there was no hardware component to this contract);
development and implementation of software for a market monitoring system;
testing the CAMA system in four pilot areas (Tver, Kemerovo, Kaluga, and
Tatarstan) as well as in Moscow, based on property details provided from BTI
records to produce property values;
training of staff from 140 administrative units in the valuation system;
a socio-economic study of the impact of a new national property tax, which was
not in the original Project design; and
advice from supervision missions on implementing the system across the country
in 2013 in accordance with government plans.
Due to the importance of Moscow City, it was agreed that it would be added to the pilot
sites in 2010 using reallocated Project funds. By mid 2011, some four million properties
had been valued in the regional pilot areas and five million in Moscow City.
The socio-economic study in each of the areas tested was an important additional element
that should help policy makers determine how property taxes will be introduced,
particularly in terms of how the burden will fall. The study is being considered by the
MOF, which has the responsibility to draft the property tax law and set the range of tax
rates. Implementation will be conducted at the regional and municipal level.
Component 4 Project Monitoring and Management
The PAD stated that the CA was to manage the Project and be assisted by a PIU. Project
monitoring was the responsibility of the CA, which already collected some of the
indicators listed in Annex 3 to the PAD. External contracts were to be let for independent
assessments of results.
At commencement, the deputy chief of the Cadastre Agency was appointed as project
director, overseeing a Project coordination unit of five staff within the larger Cadastre
System Design Department (responsible for developing the program to implement the
Federal Targeted Program). Six working groups were also covering various thematic
areas: Development of Regulative and Legal Framework, Organization and Management,
Personnel Development and Training, Cadastre Client Services, Cadastre Infrastructure
Development, Real Property Objects Valuation. There were staffing and management
changes throughout the period of the Project, but as the mid-term review of May 2008
noted, this structure had continued to work efficiently, and changes in personnel were
generally smooth.
The management structure remained consistent to a large part during the implementation
of the Project as follows:
38
At the ministerial level, responsibility for the Project rested with three ministries over the
period 2005-2011:
Ministry of Economic Development and Trade (to September 2007); and
Ministry of Economic Development (from 2008 onwards).
For a short period of about 2 months during 2008, the CA was reporting to the Ministry
of Justice. The impact of these changes in ministries appears to have been limited, as the
Project was subordinate to the CA and RosReestr at all times.
The main event in terms of project management was the merger of the CA and RRS to
form RosReesstr. This resulted in a period of interruption while the new organization was
brought together. There were, therefore, some delays in progress (as noted above where
relevant). Otherwise, project management continued without any real interruption, and to
the credit of the RosReestr, the Project coordination unit and the PIU, project activities
were able to recommence and regain pace once the institutional issues began to be
resolved.
The PIU was formed soon after loan effectiveness in December 2005 and was fully
established with two procurement specialists by May 2006. The PIU worked closely with
the CA and RosReestr to manage, implement and report on the various Project initiatives.
FCPF PIU Project Thematic Groups
Тематические группы Проекта
Project Director
Проекта
MinFin of Russia
RosReestr
IWG
Ministry for Economic
Development of Russia
Evaluation Committee Projects and Targeted Programs Department
Heads of the CA Territorial
Bodies
Development
of the
normative
legal base
Technical
support for the
cadastre
infrastructure
Real estate
objects
evaluation
Human
resources
development
and training
Organization
and
management
Rendering
services to the
cadastre
clients
39
The PIU provided regular and detailed reports on progress throughout the Project, with a
focus on procurement and financial management. As noted in the AM of the May 2008
supervision mission, “procurements, financial management and disbursements are
progressing without problems … All financial management reports and audits are
produced on time and payments to contractors and consultants are disbursed without
delay.” The rapid disbursement rate confirms this assessment – it could only have been
achieved with good project management.
Reporting on matters outside procurement and financial management was the
responsibility of the Project coordination unit. As noted in the main body of this report, in
May 2008, the supervision mission made a variety of recommendations to expand the
reports to cover project outcomes based on the results framework of the PAD and
compare the results to baseline figures (see Annex 1 of AM of May 2008). By late 2008,
the reports were complying with these recommendations, and the reports offer a fuller
picture of the Project’s progress. Reports were prepared twice a year.
One contract was let to conduct surveys. Three surveys in 2007, 2008 and 2009 focused
on client experiences, with a supplementary survey funded by RosReestr in 2011 also
considering client experiences plus development of the property market. Other contracts
were let for annual audits and internal monitoring software.
The outcome of good project management was a relatively smooth operation throughout
the project period. A discussion on monitoring and evaluation has been included in the
main body of this report, so will not be repeated here.
40
Annex 3. Economic and Financial Analysis
The Economic Analysis of the project outcomes follows the approach adopted in the
PAD. Specifically, this analysis includes efficiency benefits as received by the Cadastre
Agency through reduction in staff time processing applications; and economic benefits
received by the clients of RosReestr through reduction in time spent at the Cadastre
Agency. Benefits also include monetary benefits derived from the elimination of the
technical survey requirement for secondary transactions. There are other benefits that are
more difficult to quantify such as the benefits of increased access to cadastral information.
Benefits are estimated for offices where the Project was implemented (i.e. 45% of all
offices). However, some savings and benefits that arise from project interventions
including legislative reforms (eliminated unnecessary steps in the cadastre process) and
improved information and communication systems accrue to all offices. Benefits accrue
to the general public, the legal and financial sectors, and the government.
Improved efficiencies (time savings)
During the life of the Project (2006-2011), approximately 122 million transactions of
various types were recorded in Russia. It is difficult to attribute the increase in
transactions processed solely to the Project’s activities because the property markets are
influenced by many other important variables in the economy that cannot be isolated.
However, we can attribute the savings in specific efficiencies due to Project activities as
well as savings to the client due to elimination of the technical inventory for secondary
transactions requirement.
In terms of increased efficiency of undertaking transactions, the PAD notes that major
savings in reduced transaction times, fewer visits to the Cadastre Agency (CA) offices,
improved efficiency of staff members and shorter times spent by clients at the CA offices
would be expected outcomes of the project activities. The Project results validate and
exceed the PAD assumptions: the reduction in the average time for processing new
property surveys by the Cadastre Agency decreased from 1 month in 2007 to 20 working
days in 2011. The average time for completion of transactions in immovable property
reduced from 35 days and 29 days in 2007 to 19.6 days and 19.4 days, (for individuals
and legal entities, respectively) respectively.
One of the Project’s main aims was to increase efficiency of the offices at the Cadastre
Center. Each worker is now processing 95 more transactions per year than before; in
2007 the processing efficiency at the Cadastre Agency was 1,322.7 transactions per
worker in 2007 and in 2011 it was 1,417.8 transactions per worker. However, in some
years, staff efficiency dropped for two reasons: (a) increases in staff hired at RosReestr;
and (b) the impact of large organizational changes and introducing new operational and
regulatory changes (learning curve). Compared to 2007 data, staff efficiency increased
by 7% by the end of the Project.
41
There was reduction of 9 minutes in the average time a client spends in the Cadastre
Agency per visit from 57 minutes in 2007 to 48 minutes in 2011. Therefore, compared to
2007 data there was a 36.8% reduction in time spent at the CA. Compared to 2004 data
when the client spent an average 120 minute each visit, there was a 63.8% reduction in
time spent at the CA. For all the above time savings, the analysis applies the average
wage rate of $810 per month to monetize these savings, (July 2011 Rostat/Russian
Economic Report).
Savings due to elimination of survey requirement
The requirement for a technical inventory for secondary transactions, which was
eliminated as recommended by the Project, amounted to large savings for members of the
public. Costs for technical inventory increased from USD20-50 at the time of appraisal to
a reported USD160 for a building and USD270 for land (in the Moscow area). Using a
conservative estimate of US50, and assuming that only five percent of those transactions
are related to secondary transactions, then a minimum of USD67.5 million were saved in
2011 alone from the elimination of the technical inventory requirement. Multiplied across
the life of the Project, the figure rises to nearly USD340 million saved during the life of
the project arising from the elimination of technical inventory.
There are other benefits associated with improved access to cadastral information that are
more difficult to quantify, including the savings by other public and private users of
cadastral data who now have faster access to more reliable data for important investment
or policy making decisions as a result of Project activities. The number of information
requests increased 60% from 916,155 per year in 2007 to 1,463,974 per year in 2011. It
is well known that investments in cadastre and registration systems improve access to
finance and other investments in the housing market for example. RosReestr introduced
online access to certain information, which was facilitated through Project sponsored
software, hardware and communication systems. Since the introduction of this on-line
access in mid 2010, daily requests have risen to 6,000 and continue to grow rapidly. The
Project has laid the foundations for further expansion in formation and access to spatial
data for improvements in urban and spatial planning as well as other e-services. The
government has recently allowed financial institutions to accept electronic documents,
and it is expected that notaries will soon follow suit in line with the modernizing trend of
reliance of e-documents and transactions throughout Eastern Europe.
Based on the above approach, the economic benefits far exceed the costs. The calculated
economic rate of return was calculated at 24%, and the net present value of the benefits
realized over a 15-year period is over 692 million USD, assuming a 10% discount rate.
The NPV of the Project during its life exceed 130 million USD. While this analysis is
stylized and simplified, (it is impossible to account for all relevant factors) it is useful as
an estimate on the magnitude of achieved results.
Part B. Fiscal Impact
42
The work under the Bank-financed Project included pilot testing for market based
property valuation methodology and regulation. Implementation of the new tax changes
was not included as part of the Project, and the amendments to the law on real property
taxation remains with Parliament. The immediate intention of the government is for the
law to be revenue-neutral. Benefits of improved efficiency and equity in the tax system
may be realized in the future based in part upon the Project's work.
43
Annex 4. Bank Lending and Implementation Support/Supervision Processes
(a) Task Team members
Names Title Unit Responsibility/
Specialty
Lending
Edward C. Cook Sr Land Administration Specialist ECSSD Team leader
Gavin P. Adlington Consultant Land administration
Maria L. Amelina Social Development Specialist SDV Social development
Vera A. Matusevich Operations Officer ECSSD Operations
Alexander Roukavichnikov Procurement Specialist ECSPS Procurement
Alexander Balakov Procurement Specialist ECSPS Procurement
Galina S. Kuznetsova Financial Management Specialist ECSPS Financial
management
Ekaterina Arsenyeva Financial Management Specialist ECSPS Financial
management
Lynn Holstein Lead Land Administration
Specialist ECSSD Land administration
Juan Navas-Sabater ICT Specialist CITPO ICT
Jonathon Krull Consultant Business systems
Nikolai Soubbotin Lawyer LEGEN Law
Joseph Goldberg Sector Manager ECSSD
Supervision/ICR
Samir M. Suleymanov Sr Operations Officer SECVP Team leader
Gavin P. Adlington Lead Land Administration
Specialist ECSSD3 Land administration
Maria L. Amelina Sr Social Development Specialist SDV Social development
Alexander Balakov Procurement Specialist ECSO2 Procurement
Anna-Maria Bogdanova Operations Analyst ECCU1 Operations
Mikhail Bunchuk Consultant IT
Svetlana Valeryevna Hoersch Operations Analyst ECSSD Operations
Svetlana Kleymenova Team Assistant ECCU1 Operations
Jonathan F. Krull Consultant Business systems
Galina S. Kuznetsova Sr Financial Management Specialist ECSO3 Financial
management
Aziz Mamatov Financial Management Specialist ECSOQ Financial
management
Vera A. Matusevich Operations Officer ECSS3 Operations
Paul Munro-Faure Consultant Valuation
Juan Navas-Sabater Lead ICT Policy Specialist TWICT ICT
Alexander Rukavishnikov Procurement Specialist ECSO2 Procurement
Wael Zakout Lead Operations Officer ECSS6 Team leader
Rumyana Tonchovska Consultant IT
Maha Armaly Sr. Urban Finance Specialist ECSS6 Team leader
Neil Pullar Consultant IT
Simon Keith Consultant Valuation
44
Robin Waters Consultant Cadastre/NSDI
Irek Smolewski Procurement Specialist ECS02 Procurement/IT
Sedat Bakici Consultant Cadastre/NSDI
Peter Creuzer Consultant Cadastre
Anna Georgieva Country Sector Coordinator ECSSD Country
coordination
Malcolm Childress Sr. Land Administration Specialist ECSS3 Team leader
Anthony Lamb Consultant Land registration
law/ICR
Samantha Ashley De Martino Junior Professional Associate ECSS3 ICR
(b) Staff Time and Cost
Stage of Project Cycle
Staff Time and Cost (Bank Budget Only)
No. of staff weeks US$ Thousands (including
travel and consultant costs)
Lending
FY03 151.36
FY04 161.73
FY05 214.20
FY06 0.02
FY07 0.00
FY08 0.00
Total: 527.31
Supervision/ICR
FY03 00.00
FY04 0.00
FY05 0.00
FY06 102.85
FY07 129.01
FY08 116.59
FY09 133.07
FY10 69.24
FY11 79.20
FY12 (Budget) 36.0 0
Total: 665.96
45
Annex 5. Beneficiary Survey Results (if any)
N/A
46
Annex 6. Stakeholder Workshop Report and Results (if any)
N/A
47
Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR
During the review of the final draft ICR (December 2012), RosReestr provided the
following comments which were incorporated in the final ICR.
1. Intermediate Outcome Indicator 1: Reduction in average time for processing new
property surveys by Cadastre Agency: Current indicator is 4 weeks down from 8
weeks did not meet target of 2 weeks. The law of the Russian Federation
stipulates 20 days (i.e. 4 weeks) and therefore the reduction of 50% of the time is
substantial. In addition 20 days allow for a comprehensive review of survey
documents and better decision making particularly during time of transition to
ensure quality. Time costs were reduced without loss of service quality.
2. Intermediate Outcome Indicator 2: Reduction in number of steps requiring the
client to interact with the Cadastre Agency in connection with the transactions in
immovable property. The current indicator is 3 steps vs. 4 steps at the beginning
of the Project, while the target is 2 steps. It is important to note that the procedure
is set by law, and therefore cannot be changed by RosReestr. It is important to
note however that these steps and procedures are now done in electronic form and
do not require visits or physical exchange of documents, thus saving client and
staff considerable time.
3. Clarification on staff productivity?
4. It was clarified that in addition to the 5 pilot property valuations financed by the
Bank loan, valuation in 7 additional regions were completed and financed by the
Government as originally planned.
5. It is clarified that linkages are established with 50 federal agencies (e.g. Ministry
of Economic Development, Tax authorities, Ministry of Internal Affairs, Ministry
of Communications and transportation – among others) that utilize data from
RosReestr. At the same time RosReestr has immediate access to necessary data
from 14 federal agencies in order to complete and verify responses and
applications related to real estate cadastre. RosReestr also clarified that the
private sector (real estate agencies, developers, commercial banks and notaries, as
well as private citizens) have immediate access to cadastral and legal property
data through RosReestr’s portal.
6. RosReestr noted that 99% of equipment procurement was done through ICB.
RosReestr was pleased with the procedure because it gave clear rules. Russian
firms or local representative of large multinational firms won the majority of the
contracts indicating the existence of a competitive market within Russia for IT
equipment.
7. RosReestr noted that the valuation component will facilitate the understanding
and potential introduction of a modern value based property tax system. However
the final introduction of the system is not the responsibility of RosReestr and was
not part of the Project.
8. Regarding Project Costs.
a. Due to the LA amendment of August 25, 2005 (loan No. 4800-RU) in part
pertaining to reallocation of USD 1.095 million from Category 3 Training to
Category 2 Consultant services, including audit (letter of the RF Ministry of
48
Finance of January 13, 2010 No. 01-PD-64/02), the overall amount of the
Institutional Development of the Real Estate Cadastre Component is USD 6.251
million (instead of the previous amount of USD 7.346 million). Besides, because of
the above reallocation of funds, the total amount of the Real Estate Taxation
Development Component increased by USD 1.095 million and reached USD
11.765 million (instead of the previous amount of USD 10.670 million).
b. Given information provided in Para 1 and the fact that disbursements under the
Institutional Development Component amounted to USD 5.208 million, the
disbursement percentage makes 83.3% rather than 100%. Besides, disbursements
under the Real Estate Taxation Development Component amounted to USD 11.117
million, which makes 94.5% of the target.
c. Disbursement under the Cadastre System Interrelations (Cadastre Interaction
Systems) amounted to USD 79.490 million, which makes 101.3% of the initial
target.
d. Disbursements under the Project Management and Monitoring Component
amounted to USD 3.760 million, which makes 99.8% of the initial target.
49
Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders
N/A
50
Annex 9. List of Supporting Documents
Project Appraisal Document, Russian Federation, Cadastre Development Project, April
14, 2005 Report No 32100 – RU
Loan Agreement, Amendment to Loan Agreement
A Study of the Current Registration System for Real Rights and Properties, July, 2003
Review of the Existing Information Technology Used by Offices, Suitable Analysis and
Elaboration of a Strategy and Plans for Future ICT Development, 2003
Social Survey, 2003
Report on the Legal Framework, September 2003
Report on Business Access to Land, September 2005
Federal Targeted Program: Creation of System of a Cadastre of Real Estate, (2006-2011)
Final Report on the Cadastre Development Project (Borrower’s ICR), 2011
Aide Memoires, ISRs for the Project
51
Annex 10. Subjects of Federation in which Project was Implemented
The final list of the 40 pilot Subjects of the Russian Federation to participate in the
Project as outlined in the Cadastre Agency Order of 27.09.2006 № П/0183 provided are:
1-st stage: The Republic of Tatarstan, the Nizhny Novgorod Region, the Moscow Region,
the Samara Region, the Kemerovo Region, the Tver Region, the Rostov Region, Moscow,
the Kaluga Region, the Republic of Bashkortostan, the Kaliningrad Region.
2-st stage: Republic Mordovia, Republic Udmurtia, Chuvash Republic, Krasnodar kray,
Krasnoyarsk kray, Primorskiy kray, Stavropol kray, Khabarovsk kray, Archangelsk
Oblast, Belgorod Oblast, Bryansk Oblast, Vladimir Oblast, Volgograd Oblast, Voronezh
Oblast, Irkutsk Oblast, Kirovskaya Oblast, Kursk Oblast, Lipetsk Oblast, Murmansk
Oblast, Novgorod Oblast, Novosibirsk Oblast, Perm Oblast, Saratov Oblast,
Sverdlovskaya Oblast, Tula Oblast, Tyumen Oblast, Ulyanovsk Oblast, Chelyabinsk
Oblast, Yaroslavl Oblast.
Petropavlovsk-Petropavlovsk-KamchatskiyKamchatskiy
MagadanMagadan
OkhotskOkhotsk
AnadyrAnadyr
KhabarovskKhabarovsk
Yuzhno-Yuzhno-SakhalinskSakhalinsk
VladivostokVladivostok
BirobidzhanBirobidzhanBlagoveshchenskBlagoveshchensk
YakutskYakutsk
AginskoyeAginskoyeUlan UdeUlan Ude
Ust' OrdynskiyUst' Ordynskiy
IrkutskIrkutskKyzylKyzyl
AbakanAbakan
KrasnoyarskKrasnoyarsk
Gorno-Gorno-AltayskAltaysk
NovokuznetskNovokuznetsk
KemerovoKemerovo
TomskTomsk
BarnaulBarnaul
NovosibirskNovosibirsk
OmskOmsk
KurganKurgan
TyumenTyumen
YekaterinburgYekaterinburg
ChelyabinskChelyabinsk
UfaUfa
Khanty-Khanty-MansiyskMansiysk
SalekhardSalekhard
VorkutaVorkuta
Nar'yan MarNar'yan Mar
MurmanskMurmansk
Arkhangel'skArkhangel'skPetrozavodskPetrozavodsk
KareliaKarelia
NovgorodNovgorodPskovPskov
KaliningradKaliningrad
ChitaChita
Perm'Perm'
SyktyvkarSyktyvkar
KotlasKotlas
OrenburgOrenburg
SamaraSamaraKrasnodarKrasnodarMaykopMaykop
CherkesskCherkessk
VladikavkazVladikavkaz
MakhachkalaMakhachkalaGroznyyGroznyy
NazranNazranNal'chikNal'chik AstrakhanAstrakhan
ElistaElistaStavropolStavropol
Rostov-Rostov-on-Donon-Don
VolgogradVolgograd
BelgorodBelgorod
VoronezhVoronezh
SaratovSaratov
Ul'yanovskUl'yanovskPenzaPenza
TambovTambovSaranskSaransk
LipetskLipetskKurskKursk
OrelOrel
BryanskBryansk
St. PetersburgSt. Petersburg
TulaTula
KalugaKaluga
SmolenskSmolensk TverTver
RyazanRyazan
VologdaVologda
YaroslavlYaroslavlKostromaKostroma
IvanovoIvanovoVladimirVladimir
Nizhny NovgorodNizhny Novgorod
CheboksaryCheboksary Yoshkar-OlaYoshkar-OlaKirovKirov
Kazan'Kazan' IzhevskIzhevsk
MOSCOWMOSCOW
Ura
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C e n t r a lC e n t r a l
S i b e r i a nS i b e r i a n
P l a t e a uP l a t e a uWestWest
Siber ianSiberian
PlainPlain
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ugdz
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Alin
Andayr Range
Cherskiy Range
Taymyr Peninsula
Novaya NovayaZemlyaZemlya
Severnaya SevernayaZemlyaZemlya
New Siberia New SiberiaIslandsIslands
Franz JosefFranz JosefLandLand
KolaKolaPen.Pen.
YamalYamalPen.Pen.
GydaGydaPen.Pen.
Siberian Lowland
Gora El'brusGora El'brus(5,633 m) (5,633 m)
Petropavlovsk-Kamchatskiy
Magadan
Okhotsk
Anadyr
Khabarovsk
Yuzhno-Sakhalinsk
Vladivostok
BirobidzhanBlagoveshchensk
Yakutsk
AginskoyeUlan Ude
Ust' Ordynskiy
IrkutskKyzyl
Abakan
Krasnoyarsk
Gorno-Altaysk
Novokuznetsk
Kemerovo
Tomsk
Barnaul
Novosibirsk
Omsk
Kurgan
Tyumen
Yekaterinburg
Chelyabinsk
Ufa
Khanty-Mansiysk
Salekhard
Vorkuta
Nar'yan Mar
Murmansk
Arkhangel'skPetrozavodsk
Karelia
NovgorodPskov
Kaliningrad
Chita
Perm'
Syktyvkar
Kotlas
Orenburg
SamaraKrasnodarMaykop
Cherkessk
Vladikavkaz
MakhachkalaGroznyy
NazranNal'chik Astrakhan
ElistaStavropol
Rostov-on-Don
Volgograd
Belgorod
Voronezh
Saratov
Ul'yanovskPenza
TambovSaransk
LipetskKursk
Orel
Bryansk
St. Petersburg
Tula
Kaluga
Smolensk Tver
Ryazan
Vologda
YaroslavlKostroma
IvanovoVladimir
Nizhny Novgorod
Cheboksary Yoshkar-OlaKirov
Kazan' Izhevsk
MOSCOW
K A Z A K H S TA N
J A PA N
C H I N A
M O N G O L I A
UKRAINE
BELARUS
SWEDEN
NORWAY
FINLAND
POLAND
UNITED STATES OF AMERICA
D.P.R.OF
KOREA REP.OF
KOREA
UZBEKISTAN
AZERBAIJAN
ESTONIA
DENMARK
NETH.
GERMANY
LATV
IA
LITH.
RUSSIANFED.
GEORGIA
R.
Ob
ObTobol
Yenisey
Am
ur
Indigir ka
Lena
Kolym
a
Khata
nga
Lena
Alden
Angara Ural
ARCTIC OCEAN
LakeBaikal
B a r e n t sS e a
Kara SeaLap t ev
Sea
Nor weg ian Sea
BlackSea
Eas t S ibe r ianSea
Sea o f
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Sea o f
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Cas
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Bering Strait
Ura
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C e n t r a l
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Siber ian
Plain
Kolm
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Dzh
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Andayr Range
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NovayaZemlya
SevernayaZemlya
New SiberiaIslands
Franz JosefLand
KolaPen.
YamalPen.
GydaPen.
Siberian Lowland
Gora El'brus(5,633 m)
70°N 80°N 80°N
130°E120°E110°E100°E90°E
50°N
40°N
30°N
60°N
RUSSIANFEDERATION
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0 200 400
0 200 400 600 Miles
600 Kilometers
IBRD 33470R2
MAY 2009
RUSSIANFEDERATION
OBLAST CENTERS
FEDERAL CITIES
NATIONAL CAPITAL
RIVERS
MAIN ROADS
RAILROADS
OBLAST, KRAI, REPUBLIC, AUTONOMOUSOBLAST, OR AUTONOMOUS OKRUGBOUNDARIES
INTERNATIONAL BOUNDARIES