Supplemental Letter to GEF Trust Fund Grant Agreement REPUBLIC OF CROATIA 2014 International Bank for Reconstruction and Development 1818 H Street, N.W. Washington, D.C. 20433 United States of America Re: GEF Trust Fund Grant No. TF092704 (Coastal Cities Pollution Control Project 2) Sections II.A and II.B of Schedule 2 to the GEF Trust Fund Grant Agreement: Revised Monitoring and Evaluation Indicators for Parts 1, 2 and 3.1 of the Project Dear Sirs and Mesdames: We refer to the Monitoring and Evaluation Indicators for Parts 1, 2 and 3.1 of the Project to be utilized by the Republic of Croatia (the Recipient) pursuant to the provisions of Sections II.A and II.B of Schedule 2 to the Global Environment Facility (GEF) Trust Fund Grant Agreement dated February 6, 2009, as amended, between the Recipient and the International Bank for Reconstruction and Development (the Bank), acting as an implementing agency of the GEF, to measure the progress in the implementation of Parts 1, 2 and 3.1 of the Project and the degree to which the objectives thereof are being achieved. We hereby confirm that the said Indicators consist of the parameters set forth in the Attachment to this Letter. Very truly yours, REPUBLIC OF CROATIA By: Authorized Representative Attachment Attachment to Supplemental Letter to GEF Trust Fund Grant Agreement Revised Monitoring and Evaluation Indicators Project Development Objective (PDO): The objective of the project is to improve the provision of efficient and sustainable wastewater services in participating coastal municipalities, to reduce the nutrient load entering Croatia coastal waters, and pilot innovative wastewater treatment solutions in selected municipalities Revised Project Development Objective: Data Source/ Responsibility for D=Dropped Cumulative Target Values** Frequency Methodology Data Collection PDO Level Results ~ Unit of C= Continue Baseljne Indicators 0 Measure N= New R= Revised YR I YR 2 YR 3 YR4 YRS YR6 (2010) (2011) (2012) (2013) (2014 (2015) Indicator One: Percentage of E ronment samples from Encyrnn bathing areas Reor on at in participating of the mncplteLIC municipalities 98 100% Annual otelaboratories, collated (class/oyeHV andM complying I & 2 bathing with waters) Water applicable monitoring seawater laboratories. quality standards Indicator Two: HV monitoring and progress houPeentag of reports, Bank householdstin Supervision paticiat Reports and the Sta cocital to l % C 26 76 Annual reviews, MWSC financial Utlty,eandBn wastewater statements, services benchmarking (average of updates, laboratory sub-projects) _____sample reports Percentage of HV monitoring W wastewater and progress collected that reports, Bank is treated as Supervision per applicable Reports and Uiiy VadBn legislation l o C 10 71 Annual reviews, MWSC Utility, HV and Bank (average of financial team sub-projects) statements, benchmarking updates, laboratory sub-projects)_ sample reports * Performance HV monitoring of and progress participating reports, Bank MWSCs - Supervision operating ratio Reports and Utility. HV and Bank (expenses/reve Number C 1.13 1 Annual reviews, MWSC team nues) financial (average) statements. benchmarking updates, laboratory sample reports * Performance HV monitoring of and progress participating reports, Bank MWSCs - Supervision collection rate Reports and Utility, HV and Bank (average) l % C 76 86% Annual reviews, MWSC team financial statements, benchmarking updates, laboratory sample reports * Performance HV monitoring of and progress participating reports, Bank MWSCs - debt Supervision service ratio Reports and Utility, HV and Bank (average) l Number C TBD > 1.5 Annual reviews, MWSC team financial statements, benchmarking updates, laboratory sample reports PDO Level Results Indicators: Revised PDO Level Results Indicators: Increased knowledge of nutrient reduction wastewater treatment technologies is coming from the operations of treatment plants with nutrient reduction that are being constructed under the project. Therefore, the number of such plant constructed in being used as the best measure of the knowledge ac uired. * GEF: Reduction in pollution and HV monitoring and nutrient load progress reports, discharge in Bank Supervision project Reports and participating C 0 50% Annual reviews, MWSC Utility, HV and Bank cities with % financial team enhanced statements, nutrient benchmarking reduction updates, laboratory wastewater sample reports treatment facilities (N, P) * GEF: HV monitoring and Increased progress reports, knowledge of Bank Supervision nutrient Reports and reduction R 0 3 Annual reviews, MWSC Utility, HV and Bank wastewater financial team treatment statements, technologies * benchmarkin2 updates, laboratory sample reports INTERMEDIATE RESULTS Intermediate Results: Component 1 Revised indicator Result: Component I The proposed change reflects a reduction in the number of wastewater treatment plants (WWTPs) with nutrient removal constructed from four to three, and corresponds with the grant amount that is being canceled. Volume (Mass) of Results expected COD after data on pollution load Tones/ completed WWTP Utility, HV and Bank reduction C 0 130 treatment team achieved measure efficiency are under the received. project Number of sub-loan agreements Semi- Progress Reports, HV Bank signed in l Number C 0 21 Annual Bank Missions participating cities Km of wastewater collection l Number C 0 150 Semi- Progress Reports, HV Bank systems Annual Bank Missions ' constructed Number of wastewater Semi- Progress Reports, treatment l Number C 0 18 Annual Bank Missions By, Bank plants commissioned Number of submarine l Number C 0 12 Semi- Progress Reports, HV, Bank outfalls Annual Bank Missions constructed Number of enhanced nutrient reduction O Number R 0 3 n P Mi s HV, Bank commissioned Intermediate Result: Component 2 Revised Intermediate Results: Component 2: HV and MWSCs Financial municipalities r C 0Annual prepare [] Number 0 S ements, HV, Bank 4 nna Progress Reports, H,Bn projects to EU Bank Mission for financing Monitoring and MWSCs Financial benchmarking Statements, system is L Yes/No C No Yes Annual Progress Reports, HV, Bank designed and Bank Mission operational Intermediate Result: Component 3 Number of participating cities in which seawater quality monitoring Progress Reports, HV, Bank, HV and system O' Number C 5 21 Annual Bank Missions MENP laboratories operational and baseline indicators in place prior to completion of construction (i) *Increased knowledge of nutrient reduction wastewater treatment technologies is coming from the operations of treatment plants with nutrient reduction that are being constructed under the project. Therefore, the number of such plant constructed in being used as the best measure of the knowledge acquired. (ii) **Since the number and names of individual subprojects was unknown at the time of project signing, exact value of project indicators was left undefined. Total value of individual indicators could be defined only after all subprojects are signed (June 2011), while annual distribution will be defined by project MTR (planned for May 2012) REPUBLIC OF CROATIA MINISTRY OF FINANCE Class: 910-01/08-01/803 Reg.No.: 513-06-05-14-24 Zagreb, June 20, 2014 The World Bank Office, Croatia Att: Mr. Hongjoo Hahm, Country Manager Subject: Croatia: GEF Grant No. TF092704 Coastal Cities Pollution Control Project 2 -Notice on Extension of closing date, Reallocation and Partial Cancellation of GEF Grant No. TF092704 Dear Mr. Hahm, We acknowledge the receipt of your letter dated June 13, 2014 notifying us on the Extension of closing date, Reallocation and Partial Cancellation of GEF Grant No. TF092704. In response, please find attached the signed Supplemental Letter to GEF Trust Fund Grant Agreement containing the Revised Monitoring and Evaluation Indicators for Parts 1, 2 and 3.1 of the Project. Sincerely, HEAD OF SECTOR Silvija Belajec Attachment: as mentioned in the text