KERALA STATE URBAN DEVELOPMENT PROJECT PERFORMS THE MAJOR FUNCTIONS OF

Mission Statement
     Reforms driven, fast track, planned development of identified cities with focus on efficiency in urban infrastructure/services delivery mechanism, community participation and accountability of Urban Local Bodies (ULBs)/ Parastatals towards citizen.

Mission Strategy

i . Planned urban perspective frameworks for a period of 20-25 years (with 5 yearly updates) indicating policies, programmes and strategies of meeting fund requirements would be prepared by every identified city. This perspective plan would be followed by preparation of Development Plans integrating land use with services, urban transport and environment management for every five year plan period.
ii . Cities/Urban Agglomerations/Parastatals will be required to prepare Detailed Project Reports for undertaking projects under identified areas.
iii . Private Sector Participation in development, management and financing of Urban Infrastructure would be clearly delineated.
iv . Funds for the identified cities would be released to the designated State Nodal Agency, which in turn would leverage, to the extent feasible, additional resources from the financial institutions/private sector/capital market.
v . Funds from Central and State Government will flow directly to the nodal agency designated by the State, as grant. The nodal agency will disburse central assistance to ULBs or para-statal agencies as the case may be, as soft loan or grant-cum-loan or grant.
vi . A revolving fund will be created to meet the operation and maintenance costs of the assets created under the Mission.

Mission Objectives

a) Focused attention to integrated development of infrastructural services in the cities covered under the Mission.
b) Secure effective linkages between asset creation and asset management so that the infrastructural services created in the cities are not only maintained efficiently but also become self-sustaining over time.
c) Ensure adequate investment of funds to fulfill deficiencies in the urban infrastructural services.
d) Planned development of identified cities including peri-urban areas, out growths, urban corridors, so that urbanization takes place in a dispersed manner.
e) Scale up delivery of civic amenities and provision of utilities with emphasis on universal access to urban poor.
f) To take up urban renewal programme, i.e., re-development of inner (old) cities area to reduce congestion

Duration of the Mission

     The duration of the Mission would be seven years beginning from 2005-06.During this period, the Mission will seek to ensure sustainable development of select cities. An evaluation of the experience of implementation of the Mission would be undertaken before the commencement of Eleventh Five Year Plan and if necessary, the programme calibrated suitably.

Scope of Mission Programme

     The Mission shall comprise two Sub- Missions, namely:
(1) Sub-Mission for Urban Infrastructure and Governance:
      This will be administered by the Ministry of Urban Development through the Sub-mission Directorate for Urban Infrastructure and Governance. The main thrust of the Sub-Mission will be on infrastructure projects relating to water supply and sanitation, sewerage, solid waste management, road network, urban transport and redevelopment of old city areas with a view to upgrading infrastructure therein, shifting industrial and commercial establishments to conforming areas, etc.
(2) Sub-Mission for Basic Services to the Urban Poor:
      This will be administered by the Ministry of Urban Employment and Poverty Alleviation through the Sub-Mission Directorate for Basic Services to the Urban Poor. The main thrust of the Sub-Mission will be on integrated development of slums through projects for providing shelter, basic services and other related civic amenities with a view to providing utilities to the urban poor.

Mission Components

1. Admissible Components

     Projects pertaining to the following will be admissible under the Sub-Mission on Urban Infrastructure and Governance.
i. Urban Renewal i.e. redevelopment of inner (old) city areas [this would include items like widening of narrow streets, shifting of industrial/commercial establishments from non-conforming to `conforming’ areas to reduce congestion, replacement of old and worn-out water pipes by new/higher capacity ones, renewal of Sewerage/drainage/solid waste disposal systems, etc.
ii. Water Supply (including de-salination plants) and sanitation
iii. Sewerage and Solid Waste Management
iv. Construction and improvement of drains/storm water drains
v. Urban Transport, including roads, highways/expressways/ MRTS/metro projects.
vi. Parking lots/spaces on Public Private Partnership basis
vii. Development of heritage areas
viii. Prevention & rehabilitation of soil erosion/landslides only in case of Special Category States where such problems are common and
ix. Preservation of water bodies.

     note : Land cost will not be financed except for acquisition of private land for schemes/ projects in the North                 Eastern States & hilly States viz Himachal Pradesh, Uttaranchal and Jammu & Kashmir.

2. Inadmissible Components

Projects pertaining to the following will not be admissible under the Sub-Mission :
i. Power
ii. Telecom
iii. Health
iv. Education
v. Wage employment programme & staff component

Mission Coverage

     Keeping in view the paucity of resources and administrative constraints in taking up all cities and towns under this intensive urban infrastructure improvement programme, it is suggested that under JNNURM only selected cities/Urban Agglomerations (UAs) as per 2001 Census will be taken up, as per norms/criteria mentioned below:

Total 63 towns covered under JNNURM.
The cities should have elected bodies in position.

Urban Reforms
     The main thrust of the revised strategy of urban renewal is to ensure improvement in urban governance so that Urban Local Bodies (ULBs) and parastatal agencies become financially sound with enhanced credit rating and ability to access market capital for undertaking new programmes and expansion of services.

In this improved environment, public-private participation models for provisioning of various services would also become feasible. To achieve this objective, State Governments, Urban Local Bodies and para-statal agencies will be required to accept implementation of an agenda of reforms. The proposed reforms shall broadly fall into two categories:-

I. Mandatory reforms
ii. Optional reforms

i. MANDATORY REFORMS

     There will be two sets of mandatory reforms. Core reforms at ULB/Parastatal level aims at process re-engineering through deployment of technology to enable more efficient, reliable, timely services in a transparent manner. The other set of reforms are framework related at State level.

1. Urban Local Body / Parastatal level Reforms

i. Adoption of modern, accrual-based double entry system of accounting in Urban Local Bodies/Parastatals
ii. Introduction of system of e-governance using IT applications like, GIS and MIS for various services provided by ULBs/Parastatals.
iii. Reform of property tax with GIS, so that it becomes major source of revenue for Urban Local Bodies (ULBs) and arrangements for its effective implementation so that collection efficiency reaches at least 85% within next seven years.
iv. Levy of reasonable user charges by ULBs/Parastatals with the objective that full cost of operation and maintenance or recurring cost is collected within next seven years.
v. Internal earmarking within local body, budgets for basic services to the urban poor.
vi. Provision of basic services to urban poor including security of tenure at affordable prices, improved housing, water supply, sanitation and ensuing delivery of other already existing universal services of the Government for education, health and social security.

2. State Level Reforms

i. Implementation of decentralization measures as envisaged in 74 th Constitution Amendment Act. States should ensure meaningful association/engagement of ULBs in planning function of parastatals as well as delivery of services to the citizens.

ii. Repeal of Urban Land Ceiling and Regulation Act.
iii. Reform of Rent Control Laws balancing the interests of landlords and tenants.
iv. Rationalisation of Stamp Duty to bring it down to no more than 5% within next seven years.
v. Enactment of Public Disclosure Law to ensure preparation of medium term fiscal plan of ULBs/Parastatals and release of quarterly performance information to all stakeholders.
vi. Enactment of Community Participation Law to institutionalize citizen participation and introducing the concept of Area Sabha in urban areas.
vii. Assigning or associating elected ULBs with “city planning function”. Over a period of seven years, transferring all special agencies that deliver civic services in urban areas to ULBs and creating accountability platforms for all urban civic service providers in transition.
* Note: In respect of schemes relating to water supply and sanitation, the under mentioned State level mandatory reforms may be taken as optional reforms:-
i. Repeal of Urban Land Ceiling Act
ii. Reform of Rent Control Act

ii. OPTIONAL REFORMS (Common to State and ULBs/Para-statals)

i. Revision of bye-laws to streamline the approval process for construction of buildings, development of sites etc.
ii. Simplification of legal and procedural frameworks for conversion of agricultural land for non-agricultural purposes.
iii. Introduction of Property Title Certification System in ULBs.
iv. Earmarking at least 20-25% of developed land in all housing projects (both Public and Private Agencies) for EWS/LIG category with a system of cross subsidization.
v. Introduction of computerized process of registration of land and property.
vi. Revision of bye-laws to make rain water harvesting mandatory in all buildings and adoption of water conservation measures.
vii. Bye-laws for reuse of recycled water.
viii. Administrative reforms i.e. reduction in establishment by bringing out voluntary retirement schemes, non-filling up of posts falling vacant due to retirement etc., and achieving specified milestones in this regard.
ix. Structural reforms
x. Encouraging Public Private Partnership

Note : 1. Any two optional reforms to be implemented together by State & ULBs/Parastatals in each year.
          2. All the reforms (mandatory as well as optional) shall be implemented by State/ULB/Parastatal within the               Mission period.

Memorandum of Agreement (MOA)

     The State Governments and the ULBs including para-statal agencies where necessary would execute Memorandum of Agreement (MoA) with Government of India indicating their commitment to implement identified reforms. MoA would spell out specific milestones to be achieved for each item of reform. Signing of MoA will be a necessary condition to access Central assistance. This tripartite MoA would be submitted along with Detailed Project Reports (DPRs). The central assistance will be predicated upon the State Governments and the ULBs/Parastatals agreeing to the reforms platform.

National Steering Group
        To steer the Mission objectives, a National Steering Group will be constituted
        The composition of the National Steering Group will be as follows:

i. Minister of Urban Development Chairman
ii. Minister for HUPA Co-Chairperson
iii. Secretary (HUPA) Member
iv. Secretary, Planning Commission Member
v. Secretary (Expenditure) Member
vi. National Technical Advisor Member
vii. Secretary (Urban Development) Member-Convener

Mission Directorate

        There shall be a Mission Directorate under the charge of Joint Secretary in Ministry of Urban Development for ensuring effective coordination with State Governments and other agencies for expeditiously processing the project proposals.
        National Technical Advisor shall be one of the Members of Directorate. The Mission Directorate will process the project proposals received from State Governments and place them before Central Sanctioning and Monitoring Committee for consideration.
Appraisal of Projects
         Detailed Project Reports would be scrutinized by the Technical wings of the Ministry or if necessary by specialized/technical agencies before placing such proposals for sanction by Central Sanctioning and Monitoring Committee.
Sanction of projects under the Mission
         There would be a Central Sanctioning & Monitoring Committee in the Ministry of Urban Development for sanctioning the projects submitted by identified states, which would comprise-

1. Secretary (UD) Chairman
2. Secretary (HUPA) Member
3. Secretary, Ministry of Finance (Dept. Member of Expenditure)
4. Principal Adviser (HUD), Member Planning Commission
5. Secretary, Ministry of Environment & Forests Member
6. Secretary, Ministry of Social Justice and Member Empowerment
7. Joint Secretary & FA, Ministry of Urban Dev Member
8. Chief Planner, TCPO Member
9. Adviser, CPHEEO Member
10. CMD, HUDCO Member
11. Joint Secretary (UD) Member-Secretary

                 The Committee would assign higher priority in sanctioning projects of urban renewal, water supply including sanitation, sewerage, solid waste management, drainage, urban transport including roads. Projects with private sector participation will be given priority over projects to be executed by ULBs/Parastatals themselves, as this will help leverage private capital and bring in efficiencies.

Advisory Group
                 In addition, at the National level, an Advisory Group would be constituted for the Mission/sub-Mission. The Group would be headed by a Technical Adviser drawn from civil society with proven experience in mobilizing collective action for reforms in urban governance. The group would enable the Mission to create similar voluntary Technical Corps in each city identified for the Mission/sub-Mission. It would encourage private sector participation, citizen’s involvement in urban governance at grass root level and transparency in municipal governance.

State Level Steering Committee
                 At the State level, a Steering Committee would be set up by each State for deciding and prioritizing the projects under the Mission. The Steering Committee would comprise:
i. Chief Minister of the State/ Minister of Urban Development/Minister of Housing--- Chairman
ii. Minister of Urban Development - vice Chairman
iii. Minister, Housing - Member
iv. Concerned Mayors/Chairpersons of Urban Local Bodies (ULBs) - Member
v. MPs/MLAs (to be decided by the State) - Member
vi. Secretary (PHE) - Member
vii. Secretary (MA) - Member
viii.Secretary (Finance) - Member
ix. Secretary (Housing) - Member
x. Secretary (UD) - Member-Secretary

Nodal Agency
                 The Steering Committee at the State Level would be assisted by the nodal agency identified by the State Government for implementation of JNNURM. The nodal agency would, inter-alia, perform following functions:-
a. Appraisal of projects submitted by ULBs/Para-statal agencies;
b. Obtaining sanction of State Level Steering Committee for seeking assistance from Central Government under JNNURM;
c. Management of grants received from Central and State Government; d. Release of funds to ULBs/Para-statal agencies either as grant, or soft loan or grant cum loan.
e. Management of Revolving Fund
f. Monitoring physical and financial progress of sanctioned projects;
g. Monitoring implementation of reform as entered into MoA.

Financing Pattern
18.1 Financing of projects under the Mission would be as under:

                If necessary, internal resources of implementing agencies, Member of Parliament Local Area Development and Member of Legislative Assembly Local Area Development funds may be substituted for institutional finance.

                In order to prepare City Development Plan (CDP), Detailed Project Reports (DPRs), training & capacity building, community participation, information, education and communication (IEC), a provision of 5% of the Central grant or the actual requirement, whichever is less, may be kept for sanction to cities/towns covered under the Mission.

                In addition, not more than 5% of the Central grant or the actual requirement, whichever is less, may be used for Administrative and Other Expenses (A&OE) by Centre and the States. However, the Centre’s share shall not exceed 1% of the Central grant.

Release of Funds

        Funds would be released as Additional Central Assistance (100% Central Grant in respect of central share) to the State Government or its designated State Level Nodal Agency. The nodal agency will disburse central assistance to ULBs or para-statal agencies as the case may be as soft loan or grant-cum-loan or grant.
                 However, grant-cum-loan may be sanctioned in such a manner that 25% of central and state grant put together is recovered and ploughed into Revolving Fund to leverage market funds for financing of further investment in infrastructure projects. At the end of the Mission period, the Revolving Fund may be graduated to a State Urban Infrastructure Fund.
                                 The first installment of 25% will be released on signing of Memorandum of Agreement by the State Government/ULB/Para-Statal for implementation of JNNURM projects. The balance amount of assistance shall be released as far as possible in three installments upon receipt of Utilisation Certificates to the extent of 70% of the grants (Central & State) and subject to achievement of milestones agreed for implementation of mandatory and optional reforms at the State and ULB/Parastatal level as envisaged in the Memorandum of Agreement.

Outcomes of Jawaharlal Nehru National Urban Renewal Mission
                 On completion of the Mission period of seven years, it is expected that ULBs/Parastatals will achieve the following outcomes:-

(a) Modern and transparent budgeting, accounting, financial management systems designed and adopted for all urban services and governance functions
(b) City-wide framework for planning and governance will be established and become operational
(c) All urban residents will be able to obtain access to a basic level of urban services
(d) Financially self-sustaining agencies for urban governance and service delivery will be established, through reforms to major revenue instruments
(e) Local services and governance will be conducted in a manner that is transparent and accountable to citizens
(f) e-Governance applications will be introduced in core functions of ULBs/Parastatals resulting in reduced cost and time of service delivery processes.

Monitoring progress of projects sanctioned under the Mission

● Ministry of Urban Development will periodically monitor the scheme through designated Officers of this Ministry for each State/ UT.
● State level nodal agency would send quarterly progress report to the Ministry of Urban Development.
● upon completion of the project, nodal agency through the State Government would submit completion report in this regard.
● Central Sanctioning & Monitoring Committee may meet as often as required to sanction and review/monitor the progress of projects sanctioned under the Mission.
● Monitoring of progress of implementation of reforms would be outsourced to specialized/technical agencies.

In Kerala two cities Thiruvananthapuram and Kochi has been included under the JNNURM.

                 Two Cities submitted City Development Plan (CDP) to Government of India in October 2006 & entered in to MOA on 10/3/2007.

Thiruvananthapuram Corporation is included under “C” category

Finance pattern is shown below

KochiCorporation is included under “B” category
Finance pattern is shown below

Abstract of CDP for TVM & Cochin is shown below.
Project Component and Approximate Cost CDP-TVM - (Rs. Crores)

Project Component and Approximate Cost CDP-Kochi (Rs. Crores)

The details of approved Projects are given below.

                Approved Projects: (Amount in lakhs)

Thiruvananthapuram
                   1. Water Supply : 8716.00
               2. Sewerage Scheme : 21541.00
                   3. Basic Services to urban poor : 16775.00
KOCHI
                   1. Surface Water Drainage : 978.00
                   2. Sewerage Scheme : 7481.00
                   3. Solid Waste Management : 8812.00
                   4. Water Supply : 20117.00
                   5. Basic Services to urban poor : 13106.00  

Funding Pattern o the approved project.