PHILIPPINES SMALL TOWNS WATER UTILITIES DATA BOOK

Transcription

1 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized PHILIPPINES SMALL TOWNS WATER UTILITIES DATA BOOK 37284

2 ABBREVIATIONS AND ACRONYMS AusAID BRWSAMPC BWD CO COWASSCO CWSDC DILG DRWSA GOP GWD HC JWS LWUA LGU MCWD MWD NRW NWRB O&M PAWASCO PAWD Php PT PWS RUWASA RWSA SFWD SICIWA SPMPC SPRACI SRWD TCWS TWD UFW VWD WD WPEP WSP WSSPMO Australian Agency for International Development Buhi Rural Waterworks and Sanitation Multi-Purpose Cooperative Bansalan Water District cooperative Community Water and Sanitation Service Cooperative (Argao) Calapan Waterworks System and Development Corporation Department of the Interior and Local Government Darasa Rural Waterworks and Sanitation Association Government of the Philippines Guimba Water District house connection Jagna Waterworks System Local Water Utilities Administration local government unit Metro Carigara Water District Muñoz Water District non-revenue water National Water Resources Board operation and maintenance Padada Water System Cooperative Philippine Association of Water Districts Philippine Peso public tap Provincial Waterworks System Tibal-og Rural Waterworks and Sanitation Association rural waterworks and sanitation association San Francisco Water District Silay City Water District San Pedro Multi-Purpose Cooperative, Inc. San Pedro Resettlement Area Cooperative, Inc. Santa Rosa (NE) Water District Tagbilaran City Waterworks System Tandag Water District unaccounted-for water Victorias Water District water district Water Supply and Sanitation Performance Enhancement Project Water and Sanitation Program Water Supply and Sanitation Project Management Office Philippines Small Towns Water Utilities Data Book i

3 MEASUREMENT UNITS AND SYMBOLS km kilometer km 2 square kilometer l/c/d or lpcd liters per capita per day m meter m 3 m 3 /d m 3 /d/c mm n.a. % percent inch cubic meter cubic meter per day cubic meter per day per capita millimeter not available or not applicable ii

4 FOREWORD Sustainable access to water supply for all Filipinos has always been a priority of the Government of the Philippines. Yet, despite many government-supported water supply investment programs over the last three decades, a significant number of our people, especially the poor, continue to rely on unsafe sources of water supply or suffer inadequate service. During the National Water Forum in March 2004, government extended an invitation to civil society groups and the international community to help it define priority actions and policies and elicit parallel commitments for progressing towards sustainable universal access. It was clear from the Forum s results that stakeholders understood the underlying causes of poor sector performance not simply to be inadequate investments, but institutional limitations that have generated perverse incentives and discouraged improved performance by water service providers. Much effort has been initiated under the present Administration to tackle the difficult issues in the sector, including improving economic regulation comprehensively across different types of providers, rationalizing public financing in the sector to encourage best use of subsidies, and enhancing participation of consumers and the private sector as counter balance to a dominant public sector. These reforms are underway, albeit slowly. The Performance Improvement and Benchmarking of Philippines Small Towns Water Supply Project forms an important foundation for these reforms as it initiates a performance-based system for assessing the grant of water supply franchises as well as a means to support utilities in evaluating and improving their own performance by learning from others. This Data Book presents the results of the performance data collection and analysis undertaken for 20 utilities in the last 14 months of the project. The Project has been unique in its simplicity and also because it has encouraged multi-lateral working partnerships among the Department of the Interior and Local Government, the Local Water Utilities Administration and the National Water Resources Board; and between government agencies and utilities, through the Philippine Association of Water Districts and the direct participation by and dialogues with utilities themselves. In pursuing with these difficult reforms, the Government of the Philippines has been supported by the Water and Sanitation Program East Asia and the Pacific of the World Bank and the Government of Australia, through the Water Supply and Sanitation Performance Enhancement Project. We, the agencies that have worked on this Project, have been very encouraged by the reception of participating utilities and stakeholders to this piloting of a performance monitoring and improvement system. Utilities have shown keen interest in improving their own performance and in taking up their responsibility for promoting access to water supply service for all Filipinos. Angelo T. Reyes Secretary Department of the Interior and Local Government Ramon B. Alikpala Executive Director National Water Resources Board Lorenzo H. Jamora Administrator Local Water Utilities Administration Philippines Small Towns Water Utilities Data Book iii

5 FOREWORD The Philippines appears to offer many of the comforts (and occasional inconveniences) of infrastructure services found in rapidly urbanizing and developing countries in East Asia, but the relatively high rates of access belies the quality of these services. Particular to water supply, less than half of its population has water piped into homes. Many, even those in urban and peri-urban areas, are not reached by water supply network services and rely on communal systems, self-provisioning or water vendors. This poor quality of service contributes to a reduced quality of life for the poor. The Philippines water supply market is highly fragmented. Many major network providers service less than 5,000 connections and are able to reach only a small portion of their service areas. Constraints to water supply system expansion and overall performance stem from internal and external factors. Internal factors relate to systems operations that are within the control of utility management, such as network repairs and maintenance, billings and collection, management of production and distribution. External factors relate to the institutional environment in which these water enterprises operate, which is characterized by a reliance on subsidies. The Water Supply and Sanitation Performance Enhancement Project has been a key resource in supporting the Government of the Philippines to review sector performance and direct its future course of action in water and sanitation since it began in In the Project s latter years, a sub-project on Performance Improvement and Benchmarking of Small Towns Water Utilities was implemented to introduce a transparent and systematic review of utility performance with the aim of helping utilities benchmark their results with their peers and evaluate the internal processes that are affecting those results. At the same time, it helped institutionalize systems for regulating utilities and generating information for policy- and decision-makers to address the external factors. This Philippines Small Towns Water Utilities Data Book is a major final output of the benchmarking project. It features data from 20 participating small utilities and compares their performance through selected indicators that have been agreed and understood by stakeholders here and around the world. The Water and Sanitation Program East Asia and the Pacific of the World Bank and the Australian Government have been privileged to work in partnership with an active team from the Philippine Government and an enthusiastic group of small water utilities to implement this pilot project. We hope that this report will enhance understanding, by national and local government decision-makers, utilities and consumers, of the constraints faced by water service providers in taking advantage of the opportunities of increasing demand of water supply and lead to pragmatic approaches and concerted efforts to address these constraints. Angus Macdonald Counsellor Development Cooperation Government of Australia Richard W. Pollard Regional Team Leader Water and Sanitation Program East Asia and the Pacific, the World Bank iv

6 ACKNOWLEDGMENTS The Philippines Small Towns Water Utilities Data Book was prepared through collaboration between the Government of the Philippines and the World Bank, led by the Water and Sanitation Program East Asia and the Pacific. The Benchmarking Project Team members are: Fe Banluta, Jessie Gabayno, and Josephine Ramos (Department of the Interior and Local Government - DILG); Petronila Conti, Elvira de Leon and Marie Santos (Local Water Utilities Administration - LWUA); Nathaniel Santos, Belen Juarez and Edsie Peñaranda (National Water Resources Board - NWRB); Ranulfo Feliciano and Romeo Calara (Philippine Association of Water Districts - PAWD); Leila Elvas, Jema Sy (Task Team Leader) and Cesar Yñiguez (Adviser) (Water and Sanitation Program East Asia and the Pacific - WSP-EAP, the World Bank). Valuable inputs were provided by a Peer Review Panel composed of: Charles Andrews (Asian Development Bank); Ranulfo Garcia (DILG); Manuel Yoingco (LWUA); Ramon Alikpala (NWRB); William Kingdom, Luiz Claudio Martins Tavarez, Ming Zhang, and Caroline Van den Berg (World Bank), Anumpam Sharma (WSP- South Asia), and Simon Gordon Walker (Water Resources Center, UK). The Benchmarking Project was supported by an administrative and publishing team: Sylvia de Ocampo (late), Rosario Nolasco (Editor), Emma Sacote, Gilbert Villarin and Yosa Yuliarsa (WSP-EAP Communications Specialist). The Team would like to acknowledge the contribution of the water supply utilities that participated in this project and the Government of Australia. Philippines Small Towns Water Utilities Data Book v

7 CONTENTS ABBREVIATIONS AND ACRONYMS i MEASUREMENT UNITS AND SYMBOLS FOREWORD iii ACKNOWLEDGMENTS v ii PART I EXECUTIVE SUMMARY I. OVERVIEW OF THE SECTOR 2 INCREASING DEMAND FOR URBAN WATER SUPPLY 2 URBAN WATER SUPPLY MARKET SEGMENTATION 2 FRAGMENTATION IN THE REGULATION OF UTILITY PERFORMANCE 3 PROLIFERATION OF SMALL UTILITIES 3 II. PERFORMANCE IMPROVEMENT AND BENCHMARKING OF SMALL TOWNS UTILITIES IN THE PHILIPPINES THE PROJECT 5 III. METHODOLOGY 6 PARTICIPATING UTILITIES AND THEIR SELECTION 6 INDICATORS OF PERFORMANCE 7 WHAT CONSTITUTES GOOD PERFORMANCE? 8 OTHER TOOLS TO ASSESS PERFORMANCE 8 IV. SUMMARY OF PERFORMANCE BY INDICATORS 10 WATER SUPPLY COVERAGE 11 WATER AVAILABILITY 11 CONSUMPTION 11 PRODUCTION PER PERSON 11 UNACCOUNTED-FOR WATER 11 CONNECTIONS METERED 11 OPERATING RATIO 12 ACCOUNTS RECEIVABLE 12 COLLECTION EFFICIENCY 12 AVERAGE TARIFF 12 NEW CONNECTION FEE 12 vi

8 AVERAGE CAPITAL EXPENDITURE OVER LAST 5 YEARS/CONNECTION 12 STAFF/1,000 CONNECTIONS RATIO 13 V. COMMENTARY 14 BUSINESS MODEL OF SMALL WATER ENTERPRISES 14 TARIFFS AND CAPITAL FINANCING 14 OPERATIONAL MANAGEMENT AND CAPACITY 14 OVERALL PERFORMANCE BY MANAGEMENT MODELS 15 VI. WAY FORWARD 16 PART II UTILITY COMPARISONS GENERATING AND USING UTILITY PERFORMANCE INFORMATION 16 PERFORMANCE IMPROVEMENT AND BENCHMARKING PROJECT PHASE 2 16 SUPPORT FOR SMALL WATER UTILITIES AS A STRATEGY FOR MARKET INTEGRATION 17 UTILITIES TABLE 2.1 : NAMES, LOCATIONS AND TYPES OF UTILITIES 20 TABLE 2.2 : SIZE OF UTILITY 20 FIGURE 2.1 : TYPES OF WATER UTILITY 21 FIGURE 2.2 : CAPITAL EXPENDITURE PER CONNECTION 21 PRODUCTION FIGURE 2.3 : PRODUCTION VOLUME 22 FIGURE 2.4 : STORAGE CAPACITY 22 FIGURE 2.5 : PRODUCTION METERING 23 SERVICE FIGURE 2.6 : WATER COVERAGE 24 FIGURE 2.7 : WATER AVAILABILITY 24 FIGURE 2.8 : WATER USE 25 FIGURE 2.9 : PER CAPITA CONSUMPTION 25 FIGURE 2.10 : MONTHLY HOUSEHOLD CONSUMPTION 26 FIGURE 2.11 : MONTHLY HOUSEHOLD BILL 26 Philippines Small Towns Water Utilities Data Book vii

9 MANAGEMENT FIGURE 2.12 : UNACCOUNTED-FOR WATER 27 FIGURE 2.13 : CONSUMER METERING 27 FIGURE 2.14 : STAFF PER 1000 CONNECTIONS 28 FIGURE 2.15 : AVERAGE TARIFF 28 FIGURE 2.16 : UNIT PRODUCTION COST 29 FIGURE 2.17 : MANAGEMENT SALARIES 29 FIGURE 2.18 : CONNECTION FEE FOR HOUSE CONNECTION 30 TABLE 2.3 : PRIORITY NEEDS OF UTILITY 30 FINANCIAL FIGURE 2.19 : DOMESTIC TARIFF STRUCTURES GROUP 1 (TANDAG, MUÑOZ, GUIMBA, METRO CARIGARA) 31 FIGURE 2.20 : DOMESTIC TARIFF STRUCTURES GROUP 2 (SAN FRANCISCO, STA. ROSA, CALAPAN, VICTORIAS) 31 FIGURE 2.21 : DOMESTIC TARIFF STRUCTURES GROUP 3 (BUHI, TIBAL-OG, JAGNA, NUEVA VIZCAYA) 32 FIGURE 2.22 : DOMESTIC TARIFF STRUCTURES GROUP 4 (ARGAO, PADADA, DARASA, TAGBILARAN) 32 FIGURE 2.23 : DOMESTIC TARIFF STRUCTURES GROUP 5 (SILAY, BANSALAN, SAN PEDRO RACI, SAN PEDRO MPC) 33 FIGURE 2.24 : ACCOUNTS RECEIVABLE 33 TABLE 2.4 : COST OF WATER FOR DOMESTIC USE (HOUSE CONNECTIONS) 34 FIGURE 2.25 : OPERATING RATIO 34 FIGURE 2.26 : REVENUE COLLECTION EFFICIENCY 35 OPERATION AND MAINTENANCE FIGURE 2.27 : ANNUAL OPERATION AND MAINTENANCE COSTS 36 FIGURE 2.28 : O&M COST COMPONENTS 36 FIGURE 2.29 : LEAKS REPAIRED 37 FIGURE 2.30 : METERS REPLACED 37 FIGURE 2.31 : WATER QUALITY SAMPLING 38 FIGURE 2.32 : COMPLAINTS RECEIVED 38 FIGURE 2.33 : NEW CONNECTIONS 39 viii

10 PART III WATER UTILITY AND AREA PROFILES ARGAO 42 BANSALAN 44 BUHI 46 CALAPAN 48 DARASA 50 GUIMBA 52 JAGNA 54 METRO CARIGARA 56 MUÑOZ 58 NUEVA VIZCAYA 60 PADADA 62 SAN FRANCISCO 64 SAN PEDRO MPC 66 SAN PEDRO RACI 68 SILAY 70 STA. ROSA 72 TAGBILARAN 74 TANDAG 76 TIBAL-OG 78 VICTORIAS 80 Philippines Small Towns Water Utilities Data Book ix

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12 PART I EXECUTIVE SUMMARY Philippines Small Towns Water Utilities Data Book 1

13 I. Overview of the Sector Increasing Demand for Urban Water Supply The Philippines is one of the most rapidly urbanizing countries in Asia 1. By 2015, it is estimated that about 90 million Filipinos almost triple the present population will be living in towns and cities. Urban growth is occurring mostly in lower-density, peri-urban towns with less than 100,000 people. The concentration of people brings potential for economies of scale in the provision of services, but may require more complicated service delivery systems and management. One of these services is water supply. Service for formal water supply has not kept up with the increase in demand. Recent access levels have slipped. The rate of access in 2002 (80%) is actually lower than 1999 levels. In the 12-year period between 1990 and 2002, the average annual increase in water access was less than one percent. While public data show fairly high formal water supply access rates, only some 34 million Filipinos or less than half the current population (44%) has piped water connections in their homes. The rest rely on communal faucet systems, improved point sources, and alternative providers, such as water truckers and resellers. Urban Water Supply Market Segmentation In the Philippines, the urban water supply market is characterized by the presence of many types of management models. These models were formed through successive government programs that promoted specific provider models as a precondition for obtaining public or donor funding. The water supply system management models may be categorized into two groups: a) those that are managed by institutions, and b) those that are managed by users and the community. These models are as follows: Water District Local Government-operated Private Managed by Institutions quasi-public corporation formed under the Local Water Districts Law for the operation and maintenance of a water supply and wastewater management system water supply system owned and operated by the provincial, city or municipal government corporation or other private entities, such as sole proprietorships, formed under the general business and corporation laws of the country for the operation and maintenance of a water supply system Cooperative Barangay Waterworks and Sanitation Association (BWSA) Rural Waterworks and Sanitation Association (RWSA) Managed by Users or Community membership organization formed under the Cooperative Code of the Philippines to operate and maintain a water supply system and registered with the Cooperative Development Authority barangay 2 -based water users association formed to manage a community water supply system, usually point sources community-based water users association formed to manage a piped water supply system either with house connections or a network of public taps 1 Rate of urbanization in the Philippines is 3.1% compared to Asian regional average of 2.5%. 2 Barangay is the smallest political unit in the Philippines. The barangay is usually composed of some 500-1,000 households. 2

14 The last two models, BWSA and RWSA, were introduced through Executive Order (EO) #577 issued in The EO mandated the establishment of the now defunct Rural Waterworks Development Corporation, a government entity that was tasked to develop water supply systems in the rural areas. The charts below show the estimated market shares for the different provider models. Graph 1.1 Philippine Water Supply Market Distribution Distribution of Access to Water Supply by Level of Service Piped connections to households 44% Communal system 35% No formal access 21% Distribution of Piped Connections by Management Models Communitymanaged Private 11% 18% Local government 27% Water district 44% Fragmentation in the Regulation of Utility Performance The various providers identifi ed above co-exist and operate under different regulatory and financing regimes. This fragmentation has contributed to the blurring of accountability for the expansion and improvement of services. It has also made it diffi cult to put comprehensive performance systems in place that could underpin both business and sector planning. EO #123 issued in 2003 and EO #279 issued in 2004 have begun to address the regulatory fragmentation by transferring authority for local water district tariff reviews from the Local Water Utilities Administration (LWUA) to the National Water Resources Board (NWRB). This consolidates authority in NWRB to review the performance of most types of utilities. The staffing capacity of NWRB is currently unable to fully meet this responsibility. Nevertheless, it has been working over the last two years to develop more rational tariff models and, through this Project, improve utility supervision systems. It also has a plan in place to improve its staffi ng and resources over the medium-term. This, however, will need the support of the Department of Budget and Management (DBM) and Congress. Although these initiatives are slowly addressing sector fragmentation, supervision of utilities that are directly operated and managed by local government units (LGUs) conspicuously falls through the cracks. There is no clear policy on the accountability of local government-run utilities, except to the local governments themselves. LGUs, however, often have a very different set of incentives for improving service levels. They are also reluctant to increase tariffs. They are, therefore, reliant on limited public funds to support any improvements. Proliferation of Small Utilities An overwhelming majority of water supply providers are small. Of the 1,600 known network systems in urban areas, over 90% have less than 5,000 connections. These small utilities serve over 11 million of the 34 million Filipinos who have house connections. Induced by successive public programs, the proliferation of small utilities is due in part to the ad hoc nature of assigning areas of responsibility, which is mainly driven by concerns in filling Philippines Small Towns Water Utilities Data Book 3

15 immediate coverage gaps. Among water districts and local government-managed systems, areas of responsibility will correspond to the political demarcations of the entire city or town, almost by default, without necessarily any hydrological, business and medium-term investment basis. As a result, most utilities will almost never cover their nominal areas of responsibility and yet, such areas effectively become perpetual exclusive franchises for service under them. Urbanization is quickly bringing closer together what once might have been independent markets. The proliferation of small utilities will have an impact on their business and pricing strategies as they may not be able to take full advantage of the security normally provided by monopoly rights. Further, it is rare that fair exit strategies were agreed between parallel providers under these ad hoc arrangements. Thus, when service area integration becomes inevitable, strong resistance from each side can be expected, leading to potential conflict -- often at the expense of consumers. Management Models No. of Known Systems Operating in Urban Areas No. of Systems with > 5,000 Connections Water districts Local Government Private 9 4 Managed by users or community Table 1.1 Utilities with Greater Than 5,000 Connections TOTAL 1, Percentage 100% 5% Source: (2004) Local Water Utilities Administration and Department of the Interior and Local Government On the other hand, many independent systems are designed to fill a gap in peripheral areas not reached by the main utility. Usually, communitymanaged systems are formed among a group of neighboring households because they are not reached by the main water supplier, or they receive unsatisfactory service. In their case, the service area is demarcated by consensus among the project participants and expansion into unserved adjacent areas is an afterthought. The ad hoc demarcation of areas of responsibility discourages clear accountabilities for expanding coverage and other service targets. This is because any shortcoming is addressed by an alternative provider without consequence to the main franchise holder. 4

16 II. Performance Improvement and Benchmarking of Small Towns Utilities in the Philippines the Project In 2003, the Water Supply and Sanitation Performance Enhancement Project (WPEP) completed a study of management models for water supply in Philippines small towns. The study assessed the five types of management models and parameters that underlie successful or unsuccessful performance of these models. The result of the study showed that successful management models for small towns water supply exhibited the following closely inter-related characteristics: (i) cost-efficient management, (ii) active planning and expansion, (iii) good relations with local government, (iv) professional support, and (v) community involvement. In order to disseminate the study findings and provide basis for supporting improved performance among small water utilities, a performance benchmarking system was introduced. In 2004, the Water and Sanitation Program, with support from Australian Agency for International Development, assisted the Government of the Philippines to implement this project on Performance Improvement and Benchmarking of Small Towns Water Utilities in the Philippines. team of institutional partners from the Philippine government in using these tools and methodology. A project team composed of representatives from the Water Supply and Sanitation Project Management Office (WSSPMO) of DILG, NWRB, LWUA, and PAWD implemented the project. An Adviser guided and supported the team and provided them with introductory training on metric and process benchmarking and performance improvement planning. The WSP Country Team Leader coordinated inputs from the involved government agencies and organizations and, in coordination with the Project Manager, managed the activities to ensure on-time delivery of quality outputs. Major outputs of the project were submitted for review to a technical peer review panel composed of senior officers in DILG, NWRB, LWUA and the National Economic and Development Authority (NEDA) and international experts from, WSP, World Bank, Asian Development Bank, and the Water Resources Centre in UK. The primary aim of this Project is to support small water utilities measure their performance and hence, have a solid foundation on which to prepare performance improvement initiatives. This is achieved by (i) supporting utilities in assessing their own progress through benchmarking, (ii) increasing sector accountability by making information available to policy-makers, regulators and the public, and (iii) improving the capacity of institutional partners in monitoring the performance of water providers. The specific objectives of the project are to: (i) develop a practical methodology for the selection and elaboration of performance indicators to be used by water utilities, (ii) promote the use of benchmarking as a management tool to regularly measure operational efficiency of water utilities, (iii) compile performance profiles of participating small towns water utilities, (iv) train water utilities in the use of benchmarking data to evaluate operational processes leading towards improvement, and (v) provide practical training and mentoring to a core Philippines Small Towns Water Utilities Data Book 5

17 III. Methodology Participating Utilities and their Selection The information contained in this Data Book is based on a data collection exercise conducted in The exercise examined the performance of 20 water utilities with systems covering one or more barangays in a town or several towns in a province. Specifically targeted in this exercise were small utilities with fewer than 5,000 connections. The utilities featured here, therefore, have connections ranging from 645 to 4,291. Together, they serve over 300,000 people through some 55,000 connections and cover about 60% of the combined population within their service areas. The 20 water utilities that participated in the project included two rural water and sanitation associations (RWSAs), three LGUs, five cooperatives, one private operator, and nine water districts. Table 1.2 below provides a list and description of the participating utilities. Participating utilities were purposively selected based on a long list of proposed utilities comprising different provider models that were registered with any of the three government institutions in the Project Team. The participating utilities were chosen on the basis of a number of criteria, including the existence of some form of recording system to ensure credibility and ease of data collection that was necessary under the project. An assessment of data availability was made using a preliminary questionnaire distributed to small utilities and followup phone verification conducted by the Project Team. Final selection was based on an expression of interest by the utility to participate in the Project, which was accompanied by a demonstration of the following: Understanding of, and support for, the objectives and benefits of performance improvement through benchmarking Willingness to shoulder reasonable counterpart costs, such as those related to communication and coordination, or, in certain cases, investment Area Province Population within Service Area Table 1.2 Participating Utilities Number of Connections Name of Utility Argao Cebu 20,462 2,711 Community Water and Sanitation Service Cooperative Coop Bansalan Davao del Sur 28,422 3,551 Bansalan Water District WD Buhi Camarines Sur 19,577 1,752 Buhi Rural Waterworks and Sanitation Multi-Purpose Cooperative Coop Calapan Oriental Mindoro 44,119 4,291 Calapan Waterworks System and Development Corporation Private Darasa Batangas 14,964 1,354 Darasa Rural Waterworks and Sanitation Association RWSA Guimba Nueva Ecija 35,009 1,655 Guimba Water District WD Jagna Bohol 9,629 1,511 Jagna Waterworks System LGU Metro Carigara Leyte 24,258 3,500 Metro Carigara Water District WD Muñoz Nueva Ecija 19, Muñoz Water District WD Nueva Vizcaya Nueva Vizcaya 61,594 2,078 Provincial Waterworks System LGU Padada Davao del Sur 16,828 2,049 Padada Water System Cooperative Coop San Francisco Agusan del Sur 40,325 2,878 San Francisco Water District WD San Pedro MPC Batangas 2, San Pedro Multi-Purpose Cooperative, Inc. Coop San Pedro RACI Laguna 51,212 3,944 San Pedro Resettlement Area Cooperative, Inc. Coop Silay Negros Occidental 26,195 3,872 Silay City Water District WD Sta. Rosa Nueva Ecija 14,729 2,305 Santa Rosa (NE) Water District WD Tagbilaran Bohol 20,568 3,476 Tagbilaran City Waterworks System LGU Tandag Surigao del Sur 32,441 4,120 Tandag Water District WD Tibal-og Davao del Norte 18,900 3,133 Tibal-og Rural Waterworks and Sanitation Association RWSA Victorias Negros Occidental 25,340 3,695 Victorias Water District WD Type of Utility 6

18 in measuring devices and systems, such as production meters, computing facilities Readiness to share information and allow independent verification of data provided, including those related to WSS production and distribution, operation and maintenance and financing Indicators of Performance A consultation workshop was held in June 2004 to orient representatives of the interested utilities and members of the project team on benchmarking and to agree on the implementation arrangements for the project. Performance indicators from the World Bank International Benchmarking Network (IB-NET) Toolkit, the ADB Water Utilities Data Book and the LWUA Industry Averages were discussed during these consultations and a priority list of performance indicators were agreed upon. Performance profiles of utilities appearing in this Data Book were derived from basic data provided by the utilities and computations using the following formulas: 1. Water supply coverage (%) = [(number of HC x persons per HC) + (number of PT x persons per PT)] x 100/ [total population in service area] 2. Per capita consumption (l/c/d) = [total annual domestic consumption (m 3 ) x 1,000/365] / [number of people served] 3. Production/population (m 3 /d/c) = [annual production volume (m 3 ) /365] / [number of people served] 4. Unaccounted-for water (%) = [total annual production (m 3 ) - total annual consumption (m 3 )] x 100/[total annual production (m 3 )] 5. Average tariff (Php/m 3 ) = [total annual revenue from tariff (Php)] / [total annual consumption (m 3 )] 6. Unit production cost (Php/m 3 ) = [annual O&M cost (Php)] / [total annual production (m 3 )] 7. Operating Ratio = [annual O&M cost (Php)] / [annual revenue (Php)] 8. Revenue collection efficiency (%) = [total annual collections (Php) / total annual billings (Php)] x Cost of water for domestic use (10, 20, 30, and 50 m 3 per month) - use the corresponding tariff structure provided for each water utility. 10. Staff/1,000 connections ratio = [number of utility staff] / [number of utility connections/1,000] 11. Accounts Receivable = [total accounts receivable (Php) / total annual biling (Php)] x12 Some utilities provided information on nonrevenue water (NRW). This was defined as total annual production volume minus the total annual consumption volume which produces revenue divided by the total annual production volume calculated as a percentage. The Data Book also features an indicator for average capital expenditure per connection. Since capital spending of utilities can change significantly from year to year, the indicator here was based on the total capital expenditure of the utility between divided by five to get the annual average capital expenditure and then divided by the number of connections in the current year (2003). Data verification and clarification were necessary to ensure consistency of results between different indicators. There were instances where estimates had been provided in the absence of available measures, such as where water production was not metered or where there was no comprehensive metering of consumption. This makes unaccountedfor water data estimates at best. Information on the number of people served are based on average number of people per household connected, which are figures used in water systems design, rather than actual numbers. Philippines Small Towns Water Utilities Data Book 7

19 What Constitutes Good Performance? Benchmarking constitutes the search for best practice within a class, and therefore, employs a relative, rather than an objective, assessment technique. This means that the performance of a utility is compared with those of other participating utilities and not to any objective norm, such as national or international standards. If the batch of utilities all performed exceptionally, then even the lowest in the group cannot be said to be poorly performing. However, the opposite is also true if the batch of utilities all performed poorly, then even the top in the class could not be said to be a good performer. Instead, for this Data Book, it is suggested that the reasonable target for improving utility performance be established at the level of the lowest value within the top quartile (i.e., the top 25% of the batch). This is premised on the notion that utilities in a similar situation are able to achieve this level of efficiency. Accordingly, the graphs in Part II rank utilities under each indicator from the best to the worst performing. In this ranking, the set of 20 utilities can be divided into quartiles (groups of 5). A few quartiles may not have exactly five utilities as some utilities have equal scores. In these cases, all utilities with the same score as that of the lowest in a particular higher quartile will be classified within that higher level. Other Tools to Assess Performance For each indicator, the Data Book also provides for the mean of the 20 participating utilities. The mean, or average value, is usually helpful in gauging median performance. Since the Project did not use a statistical sampling method, no inference can be made about the performance of nonparticipating utilities based on this average value. Individual participating utilities can compare their performance against the batch average. However, as earlier suggested, a better target for improving performance would be to move up within the top quartile of the batch. In theory, performance of utilities can also be assessed based on their progress over time. Since the data collected for this pilot constitutes only a single year (2003), assessment based on comparison over time was not possible under the current project. Performance can also be compared with the industry average published by LWUA for water districts, which in 2002 comprised over 80 local water districts, ranging from small to very large. A selected list of indicators from LWUA s Industry Averages (Table 1.3) is presented in the next page. Other tools are available to assist utility performance analysis, for example, the ADB Evaluation Criteria using a scoring framework rather than a ranking and comparison of utilities. 8

20 Table 1.3 Water Districts Industry Averages in 2002 Water District / Size Category Small Average Medium Big Large V. Large Overall Number of Sample WDs in Category PROFITABILITY Net Income/Operating Revenues % Debt Service Ratio % Debt Service Php 1,589,193 2,063,263 4,588,365 7,264,949 18,264, ,574,537 6,824,844 Return on Fixed Assets % Net Income/Month Php 66, , , ,846,359 12,015, ,470 COST CONTROL Operating Ratio % Operating Expense/Month Php 346, ,319 2,184,643 4,030,736 9,148,439 38,366,159 2,906,292 Operating Exp/Conn/Month Php Operating Exp/m 3 Billed Php MARKETING EFFORT Ave. Active Service Connections No. 1,737 3,705 6,616 13,067 63, ,169 11,081 Operating Rev/Month Php 451,162 1,158,923 2,542,833 5,086,746 18,596,686 53,737,776 4,134,233 Operating Rev/Conn/Month Php Operating Rev/m 3 Billed Php m 3 Billed/Conn/Month m m 3 Billed/Month m 3 34,935 65, , ,746 1,530,685 1,857, ,397 Monthly Billing per Connection Php Monthly Billing per cu. m. Php COLLECTION EFFORT Average Collection Period Day Collection Ratio % PRODUCTION EFFICIENCY Metered Service Connection No. 1,814 3,694 6,654 13,244 42, ,305 10,118 Non-Revenue Water % Production Capacity Utilized % Pumping Expense/m 3 Produced Php Treatment Exp/m 3 Produced Php Fuel Exp for Pumping/ m 3 Produced Php Total Prdn Exp/m 3 Produced Php Total Prdn Exp/Conn/Month Php Total Prdn Exp/Operating Expense % m 3 Produced m 3 739, ,351 2,192,996 5,552,736 22,453,810 44,828,373 4,203,408 PERSONNEL MANAGEMENT Average No. of Employees No Active Serv. Conn./Employee No Philippines Small Towns Water Utilities Data Book 9

21 IV. Summary of Performance by Indicators The following table (Table 1.4) presents the summary of results for the 20 water utilities with the average and top quartile (top 25%) values for each of the indicators. While the top quartile values for most indicators represent the suggested target for improvement, this target may not be appropriate for all indicators. For example, the top quartile may not be a relevant target for average tariffs. Similarly, in relation to consumption per capita, the utilization levels may indicate wasteful use of resources (if consumption is too high) or insufficient availability of water for basic hygiene uses (if consumption is too low). Users of these data should be discerning in the use of the target values for performance improvement. The key is to differentiate between those indicators that are under management operational control, i.e., those where the actions of managers can affect the result, and those that cannot. Table 1.4 Summary of Results Indicators (Units) Argao Bansalan Buhi Calapan Darasa Guimba Jagna Metro Carigara Muñoz Nueva Vizcaya Average Top 25% Water Coverage (%) Water Availability (hours) Consumption/Capita (l/c/d) Production/Population (l/d/c) Unaccounted-for Water (%) Connections Metered (%) Operating Ratio Accounts Receivable (months) Revenue Collection Efficiency (%) Average Tariff (Php/m 3 ) New Connection Fee (Php) 3,350 2,100 1,535 5,200 3,032 2, ,250 2,648 2,100 Capital Expenditure/ Connection (Php) 1, Staff/1,000 Connections (ratio) Indicators (Units) Padada San Francisco San Pedro MPC San Pedro RACI Silay Sta. Rosa Tagbilaran Tandag Tibal-og Victorias Average Top 25% Water Coverage (%) Water Availability (hours) Consumption/Capita (l/c/d) Production/Population (l/d/c) Unaccounted-for Water (%) Connections Metered (%) Operating Ratio Accounts Receivable (months) n.a Revenue Collection Efficiency (%) Average Tariff (Php/m 3 ) New Connection Fee (Php) 2,400 1, ,600 2,850 2, ,400 2,050 2,648 2,100 Capital Expenditure/ Connection (Php) 308 3,550 n.a Staff/1,000 Connections (ratio) * Connection fees for Jagna, San Pedro MPC and Tagbilaran do not include materials and installation costs. 10

22 Water Supply Coverage The computation of coverage here relates only to utilities current service areas and not to their franchise areas nor the total area considered in official census and surveys. This was done because of the lack of comparability between how areas of responsibility are assigned among the different utility management models, as discussed in the introduction. Although only the service areas were considered, none of the 20 utilities has 100% coverage. The average coverage is only 62.5%. Only six utilities covered between 81.5% (Carigara) and 90.0% (San Pedro MPC) of their service areas. Nueva Vizcaya (18.7%), Guimba (26.8%), Tagbilaran (39.6%), and San Francisco (40.2%) have the lowest coverage either due to high UFW or shortage of water resources for development. Access to financing prevents small utilities from expanding coverage, particularly among the community-managed systems. Water Availability Only seven of the utilities, five of which are water districts, provide 24-hour water supply with the rest providing 16 to 22 hours of supply, except for San Pedro RACI (2.5 hours). Water availability that is less than 24-hours not only poses a risk to health, but also affects meter efficiency. Full metering combined with higher tariffs to cover operation and maintenance (O&M) and expansion costs can help achieve higher coverage and 24-hour water supply as observed by most of the water districts in this study. Consumption The areas where consumption is highest include Padada (159 lcd), San Pedro MPC (154 lcd), Buhi (146 lcd) and Jagna (132 lcd). By contrast, there are a number of low consumption areas, such as Tandag (61 lcd), Metro Carigara (86 lcd), Bansalan (86 lcd) and San Pedro RACI (87 lcd). High consumption demonstrates that the system allows for this level of consumption and that consumers are willing to pay for such consumption at the given price. In areas where consumption is low, customers are paying higher average tariffs than those in the high consumption areas. This is true for all areas except for San Pedro RACI, where consumption is low because of their limited production capacity. Production per Person This indicator measures total annual water supplied for distribution and provides an indication of overall efficiency of water resource use. The low figures of San Pedro RACI (0.101), Tandag (0.109), Bansalan (0.116) and Sta. Rosa (0.145) reflect a shortage of water resources available for distribution. High levels of production per person coupled with high levels of unaccounted-for water are noted in Nueva Vizcaya (0.357), Tagbilaran (0.286) and Calapan (0.245). On the other hand, the high production per person values in Buhi (0.230) and Padada (0.191) seem to be meeting the levels of high consumption among their customers. Unaccounted-for Water The best performers in relation to low UFW are Muñoz (6.7%), Sta. Rosa (9.2%), Padada (10.7%), and San Pedro RACI (11.0%). San Pedro RACI s low UFW, however, needs to be considered in relation to its acutely limited water supply, which is provided only 2.5 hours everyday. The worst performers are Nueva Vizcaya (59.7%), Tagbilaran (58.1%), Calapan (40.6%), and Metro Carigara (37.9%). Given the generally low coverage and low water availability by a number of utilities, more effort must be exerted to reduce UFW levels. This includes 100% metering of production and consumption, repair of visible leaks, elimination of illegal connections, and identification and repair of invisible leaks. It must also be noted that while metering of consumption is generally high among the utilities, about 40% of them have no production meters. Hence, some of the UFW figures are, at best, only estimates. Connections Metered Metering is important to fully account for water production and consumption and in reducing UFW. Half the number of utilities has 100% metering of consumption, nine with 90-99% metering, and the last utility with 83%. While the average rate of metering is high, it is equally important that meters are calibrated regularly, repaired or replaced if needed. For example, Muñoz and Sta. Rosa, both Philippines Small Towns Water Utilities Data Book 11

23 with low UFW, replace meters every 5-7 years and recalibrate them regularly. Operating Ratio A low operating ratio means revenues from tariffs cover the O&M costs comfortably. A ratio above one indicates that utilities are not able to cover their O&M costs. It is encouraging that 14 of the 20 utilities meet O&M costs. The worst performers requiring improvement are Calapan (1.39), Nueva Vizcaya (1.18), San Pedro RACI (1.13) and Silay (1.11), while the best performers are Jagna (0.59), Sta. Rosa (0.68), Bansalan (0.72), and San Francisco (0.75). Accounts Receivable This indicator is employed to assess the effectiveness of a utility in financial management. In this case, the receivables are expressed in equivalents of the utility s average monthly billing. For small utilities, accounts receivable that represent less than two months of its average billing is manageable. Five utilities have accounts receivable of more than two months, Jagna (4.7 months), Padada (3.2 months), San Pedro MPC (2.2 months), Metro Carigara (2.1 months) and Tibal-og (2.1 months). The good performers include Sta. Rosa (0.3 month), Nueva Vizcaya (0.4 month), Buhi (0.5 month) and Guimba, Muñoz, and Tandag with 1.0 month for each. Collection Efficiency This indicator, along with average tariff, operating ratio and accounts receivable, impacts on the financial health of a utility. All utilities have collection efficiencies of 95% or higher except for Jagna (61%), Darasa (91%) and San Pedro MPC (94%). These utilities need to improve their collection effort and encourage consumers to pay their bills on time. Average Tariff Average tariff here is expressed as the ratio of a utility s total annual revenue and total annual water consumption (water sold). Average tariff measures the financial discipline of a utility and its ability to cover operational costs with revenues from tariffs. Water districts demonstrated higher average tariffs: Bansalan (Php21.90/m3), Guimba (Php21.09/ m3), Tandag (Php20.43/m3) and Metro Carigara (Php17.99/m3). Community-managed utilities have lesser average tariffs: Buhi (Php3.73/m3) and Argao (Php6.04/m3), while LGU-ran utilities have the lowest average tariffs: Nueva Vizcaya (Php3.23/ m3) and Jagna (Php3.49/m3). Low consumption in areas with high tariffs in this study demonstrates how tariffs can be used as a tool for water demand management. New Connection Fee During the workshop presenting the results of this study, utility participants suggested that at current prices, Php2,500 was a reasonable average connection fee. Apart from a reasonable fee rate, allowing payments by installment can assist lowincome households to gain access to service in their homes, with significant benefits to their welfare. However, only five utilities allowed payment by installment over 3-12 months; the rest required payment prior to connection. Utilities with high house connection fees are Calapan (Php5,200), San Pedro RACI (Php3,600), Argao (Php3,350) and Nueva Vizcaya (Php3,250) while those with low fees are Tibal-og (Php1,400), Buhi (Php1,535), San Francisco (Php1,630) and Victorias (Php2,050). Average Capital Expenditure over Last 5 Years/Connection The overall average capital expenditure, which amounts to just higher than U$10 per connection, shows that utilities generally spent modestly on capital expenditure over the last five years. The utilities that are spending more per connection per year on capital improvements are water districts. This is not surprising given their access to financing, while RWSAs, cooperatives, and LGU-run utilities have the lowest capital expenditures. This study revealed that access to financing is a major constraint to performance improvement of non-water district utilities. Those with the lowest capital expenditure per connection per year are Nueva Vizcaya (Php115.50), Buhi (Php112.41), Tibal-og (Php87.03) and San Pedro MPC with nil. Those with the highest are San Francisco (Php3,550.42), Argao (Php1,461.82) and Bansalan (Php968.60). 12

24 Staff/1,000 Connections Ratio This indicator is generally used to measure the efficient use of human resources in a utility as manifested by low staff/1000 connection ratio. However, low staff/1000 connection ratio among the RWSAs and cooperatives needs to be considered in relation to their inability to hire given that low average tariffs leave little room to cover O&M costs, which includes personnel salaries. Utilities with low staff/1,000 connection ratios are San Pedro RACI (4.3), Tandag (4.6), Argao (5.2) and Tibal-og (5.4). Those with high ratios are Guimba (13.9), Tagbilaran (10.6) and Bansalan (9.6). Philippines Small Towns Water Utilities Data Book 13

25 V. Commentary Business Model of Small Water Enterprises Small water utilities operate like many other small businesses. Those featured in this Data Book typically have an annual collection of 7-8 million pesos, most of which go to covering O&M expenses. In general, the utilities are able to achieve positive operating ratios and manage collections, but are only breaking even for the most part. The business strategy employed by small utilities is focused on keeping costs low, as opposed to increasing revenues. This is achieved by employing a limited number of staff, relying on internal human resources for most of the technical operations, and funding expansion using internally generated surplus rather than tapping into external financing. Accordingly, system coverage, rate of network expansion and capital expenditures are modest. Tariffs and Capital Financing The areas where small utility performance are weakest (coverage, expansion and capital expenditure) are very much tied to the issue of tariffs and financing. The overall average monthly household bill is Php and among the 20 utilities, average monthly household bills range from Php to Php Table 1.5 below compares these average monthly household water bills with the average monthly income of the 5 lowest household income decile groups in urban areas. The overall average (median), lowest and highest average monthly household water bills are expressed as a percentage of this monthly household income. Average monthly bills, although they may only present a break even point for utilities, already comprise a significant threshold of expenditure to the lowest income decile groups. From this it can be concluded that small utilities will not be able to finance big ticket expansion, such as pipe laying and source development, at the rate necessary to meet market demand, through internally generated surplus alone. On the other hand, the market in which small water utilities operate is growing rapidly. But because they are unable to expand at a rate sufficient to keep up with demand, residents are resorting to alternative sources of water, or independent water supply systems are being created. While the data provided here is not independently sufficient, there is evidence that the prevalence of alternative water sources pushes the price of water downwards in areas where the utilities operate. They also keep tariffs low. Despite positive operating ratios, small water utilities have great difficulty accessing financing from the present available sources. This remains a key reason for the disintegrated nature of the water market among many small suppliers and needs to be addressed urgently. Operational Management and Capacity The performance data indicates that the small water utilities are doing well in water resources management as they are able to provide sufficient quantities of safe water. Moreover, given their small Table 1.5 Average Household Water Bill as a Percentage of Household Income among the Poorest in Urban Areas Lowest 5 Income Deciles in Urban Areas (2000) Average Monthly Household Income* Average Monthly Bill as % of HH Income Lowest Php Median Php Highest Php st Php 2, % 9.70% 16.40% 2 nd Php 2, % 7.00% 11.80% 3 rd Php 3, % 5.40% 9.20% 4 th Php 4, % 4.40% 7.60% 5 th Php 5, % 3.50% 6.00% *Based on national census

26 systems, they are able to keep unaccounted-for water in check. There is a general need to improve on customer satisfaction indicators, especially on coverage and water availability. Performance of small utilities on technical issues, such as the ability to quickly address leakages, systems breakdown and network problems, has been mixed. This largely relates to the level of skills utilities are able to maintain on their staff. Overall Performance by Management Models The overall performance of water districts are generally better than that of non-water districts, except on staff per 1,000 connections, connection fees and water production. Given the nature of the small water utility business strategy, it becomes apparent that the advantage of water districts over the others is access to technical, financial and institutional assistance through LWUA. Philippines Small Towns Water Utilities Data Book 15

27 VI. Way Forward Generating and Using Utility Performance Information The pilot Performance Improvement and Benchmarking project demonstrates that with little inputs, a practical system of performance monitoring as a starting point for improvement, can be achieved through benchmarking. The performance data collection and processing does not require a lot of additional resources from both the institutional partners and utilities, but yields useful information to many users. Among water utilities, it is hoped that benchmarking can be a management tool for improving performance by allowing comparison with peers on performance parameters. The information is intended to be shared among the growing network of water utilities in the world and in the Asian region that are exchanging information and experiences in setting up performance improvement programs, most notably the International Benchmarking Network (IB-NET) and the Southeast Asian Water Utilities Network (SEAWUN). Consumers and the general public will benefit from better awareness about the level of service and the relative performance and water pricing by their utilities to be able to demand for improved services and accountability, either from utilities or government. Systematic collection of performance data will be useful to sector planners, local governments and regulators as it highlights key performance constraints and provides information on realistic operational targets for improvement. This understanding will hopefully lead to more systematic and transparent mechanisms for investment planning, franchise delineation, and performance reviews. To be useful in informing local and national sector policy and strategies, however, the data sharing effort must have expanded participation from utilities across provider models. There is data available that could be usefully integrated into a more expansive performance management information system. These data are from LWUA s Industry Averages and annual reports to NWRB by holders of Certificates of Public Convenience (franchises), mostly private providers of water within real estate developments and housing complexes. Again, notably, the participation of LGU-managed utilities is critical as they serve a significant portion of the population, often as the provider of last resort. They generally fall outside the existing regulatory or monitoring systems. Towards the future, data for multiple years would be expected to yield even more useful information about capital formation, long-term viability and profitability of utilities, and general health of the sector. Performance data can therefore be used as a tool to target support, particularly limited public funds, to better performing utilities. Performance Improvement and Benchmarking Project Phase 2 The pilot Performance Improvement and Benchmarking Project yielded important insights on how a program for performance improvement in small towns water provision might proceed. These were presented and discussed in a workshop among representatives of the participating water utilities and national oversight agencies in May Phase 1 has demonstrated that data can be collected and compared. Clearly, sharing performance data needs to be encouraged and sustained throughout the years. However, to develop this into an improvement program requires much more work in terms of how to encourage comparison of practices rather than just numbers. Within the current pilot, the experience has been that when utilities understand how to use the performance indicators to diagnose their own systems and processes and when they are able to learn from other utility practices about ways to improve, they value the performance data collection and sharing. The experience exchange among peers during data analysis workshops brought immediate practical benefits to the participating water utilities under the pilot. There was a consensus that these activities need to be further facilitated. 16

28 Participating utilities recommended the following steps to continue the benchmarking activities started under the project: formalize practical support network/organization of water utilities make available information/resources on utility techniques/technologies, management practices, financing and operational best practices and policies regularly collate, analyze and disseminate utility performance data implement practical exchange programs among utilities and training activities The pilot batch of utilities was eager to support a continuation of the performance improvement project. They see their roles as implementers of best practices and high performance standards, big brothers to other water utilities, educators and sharers of knowledge, and promoters of publicprivate partnerships. Along with support to stimulate peer-to-peer learning, the second phase of the project is also aimed at institutionalizing the performance monitoring system and exploring how to share results on an institutional basis. Thus, the second phase of the project aims to institutionalize the benchmarking system within the NWRB based on its mandate to intermediate between the interests of service providers and consumers as economic regulator. Data integration or at least, data sharing, will also be encouraged between NWRB and LWUA and internationally, the Philippines benchmarking information system would be linked to the IB-NET and SEAWUN initiatives. Support for Small Water Utilities as a Strategy for Market Integration Small water utilities are at the frontline of providing formal network services to a significant number of Filipinos. They are able to meet their routine costs and provide relatively affordable and satisfactory services. However, small water utilities operate in a challenging market and institutional environment. Their limited scale and the downward pressure on water prices due to the presence of numerous alternative providers as well as the tariff setting systems currently in place are factors that prevent the majority of small utilities from generating adequate internal surplus to directly fund investment or to gain access to, and service, capital financing. Due in part to their size, many aspects of the business of small water utilities are highly susceptible to political interventions such as a) whether certain customers can be billed; b) the level and structure of tariffs; c) implementation of disconnection or other policies related to collection; and most persistently, d) whether utilities will be able to keep their franchise as well as the manner and basis of performance review. At present, systems are not in place for effecting rule-based performance reviews and satisfactory arbitration of interests between consumers and utilities and between utilities and local governments. Concentration of demand exists in the present rapidly urbanizing environment. And it is the inability of present providers to expand services, which predominantly leads to the disintegration of the water markets. Significantly, the findings from the data collection and pilot benchmarking exercise demonstrate that small utilities can operate viably and improve on their technical and management systems. However, expansion of network service to the vast majority of Filipinos who remain excluded will only come from sector interventions addressing external factors that constrain the integration of the water supply markets. Recognizing the dominance of small water utilities in the present water market, sector support programs need to focus on addressing the constraints that are beyond their control and pose the most significant stumbling blocks to service improvement and expansion. These programs should be aimed at -- supporting continuing improvement and efficiency of utilities and their technical and management operations systematizing performance reviews rationalizing tariffs and establishing mechanisms for fair tariff reviews Philippines Small Towns Water Utilities Data Book 17

29 finding solutions to address the financing bottlenecks for utility expansion projects and, in particular, increasing coverage among lowincome households improving and rationalizing sector planning and delineation of service areas instituting rule-based sector oversight and redress In the long run, the key to increasing access for all Filipinos to water supply relies on the increasing viability, performance and expansion of these small utilities. This means helping small utilities break the barriers that constrain them from becoming bigger and better. 18

30 PART II UTILITY COMPARISONS Philippines Small Towns Water Utilities Data Book 19

31 Utilities Table 2.1 Names, Locations and Types of Utilities Area Province Area Population Year of Data Name of Utility Argao Cebu 20, Community Water and Sanitation Service Cooperative Bansalan Davao del Sur 28, Bansalan Water District Buhi Camarines Sur 19, Buhi Rural Waterworks and Sanitation Multi-Purpose Cooperative Calapan Oriental Mindoro 44, Calapan Waterworks System and Development Corporation Darasa Batangas 14, Darasa Rural Waterworks and Sanitation Association Guimba Nueva Ecija 35, Guimba Water District Jagna Bohol 9, Jagna Waterworks System Metro Carigara Leyte 24, Metro Carigara Water District Muñoz Nueva Ecija 19, Muñoz Water District Nueva Vizcaya Nueva Vizcaya 61, Provincial Waterworks System Padada Davao del Sur 16, Padada Water System Cooperative San Francisco Agusan del Sur 40, San Francisco Water District San Pedro MPC Batangas 2, San Pedro Multi-Purpose Cooperative, Inc. San Pedro RACI Laguna 51, San Pedro Resettlement Area Cooperative, Inc. Silay Negros Occidental 26, Silay City Water District Sta. Rosa Nueva Ecija 14, Santa Rosa (NE) Water District Tagbilaran Bohol 20, Tagbilaran City Waterworks System Tandag Surigao del Sur 32, Tandag Water District Tibal-og Davao del Norte 18, Tibal-og Rural Waterworks and Sanitation Association Victorias Negros Occidental 25, Victorias Water District Table 2.2 Size of Utilities Utilities People Served No. of Connections Production (m 3 /day) No. of Staff Argao 15,624 2,711 2, Bansalan 20,232 3,551 2, Buhi 8,671 1,752 1, Calapan 18,916 4,291 4, Darasa 8,838 1,354 1,527 9 Guimba 9,399 1,655 1, Jagna 7,505 1,511 1, Metro Carigara 19,776 3,500 3, Muñoz 14,658 2,560 2, Nueva Vizcaya 11,508 2,078 4, Padada 7,840 2,049 1,500 9 San Francisco 16,226 2,878 2, San Pedro MPC 2, San Pedro RACI 23,890 3,944 2, Silay 21,912 3,872 3, Sta. Rosa 12,618 2,305 1, Tagbilaran 20,568 3,476 5, Tandag 24,878 4,120 2, Tibal-og 15,720 3,133 2, Victorias 21,216 3,695 3,

32 Figure 2.1 Types of Water Utilities 10 8 Bansalan Number of Utilities Guimba Metro Carigara Muñoz San Francisco Darasa Tibal-og Argao Buhi Padada San Pedro MPC San Pedro RACI Silay Sta. Rosa Tandag Jagna Victorias Nueva Vizcaya Tagbilaran Calapan RWSA COOPERATIVE LOCAL GOVERNMENT UNIT PRIVATE WATER DISTRICT Figure 2.2 Capital Expenditure per Connection Tibal-og RW Buhi CO Nueva Vizcaya LGU Victorias WD Darasa RW Silay WD Metro Carigara WD Utilities Padada CO San Pedro RACI CO Muñoz WD Jagna LGU Tagbilaran LGU Guimba WD Tandag WD Calapan PS Sta. Rosa WD Bansalan WD Argao CO San Francisco WD 3, ,200 1,500 *No data for San Pedro MPC was available Capital Expenditure (Php per Connection) Philippines Small Towns Water Utilities Data Book 21

33 Production Figure 2.3 Production Volume San Pedro MPC CO Jagna LG Guimba WD Padada CO Darasa RW Sta. Rosa WD Buhi CO Muñoz WD Utilities Bansalan WD Tibal-og RW San Pedro RACI CO San Francisco WD Argao CO Tandag WD Metro Carigara WD Silay WD Victorias WD Nueva Vizcaya LG Calapan PS Tagbilaran LG 0 1,000 2,000 3,000 4,000 5,000 6,000 Production (Cubic Meters Per Day) Figure 2.4 Storage Capacity Calapan PS Darasa RW Tibal-og RW Metro Carigara WD Jagna LG Bansalan WD Tandag WD Utilities Sta. Rosa WD Padada CO Buhi CO Guimba WD Muñoz WD Victorias WD Silay WD Argao CO San Pedro RACI CO San Francisco WD Tagbilaran LG Nueva Vizcaya LG ,000 1,200 1,400 1,600 1,800 2,000 *No data for San Pedro MPC was available 22 Storage Capacity (Cubic Meters)

34 Figure 2.5 Production Metering Argao Buhi Guimba 8 Jagna Number of Utilities 6 4 Bansalan Calapan Darasa Muñoz San Francisco Silay Sta. Rosa Tagbilaran Nueva Vizcaya Tandag Padada Tibal-og 2 San Pedro MPC Victorias San Pedro RACI 0 Metro Carigara NO METERING 70% METERED 100% METERED Percentage of Production Metered Philippines Small Towns Water Utilities Data Book 23

35 Service Figure 2.6 Water Coverage Nueva Vizcaya LG Guimba WD Tagbilaran LG San Francisco WD Calapan PS Buhi CO San Pedro RACI CO Padada CO Utilities Darasa RW Bansalan WD Muñoz WD Argao CO Tandag WD Jagna LG Carigara WD Tibal-og RW Silay WD Victorias WD Sta. Rosa WD San Pedro MPC CO Percent of Service Area Population Figure 2.7 Water Availability San Pedro RACI CO Calapan PS Nueva Vizcaya LG Bansalan WD Buhi CO Jagna LG Darasa RW Victorias WD Utilities Tagbilaran LG San Francisco WD Padada CO Tandag WD Argao CO Silay WD Sta. Rosa WD Muñoz WD Guimba WD Metro Carigara WD San Pedro MPC CO Tibal-og RW Average Number Of Hours Per Day 24

36 Figure 2.8 Water Use Domestic Other UfW Argao CO Bansalan WD Buhi CO Calapan PS Darasa RW Guimba WD Jagna LG Metro Carigara WD Utilities Muñoz WD Nueva Vizcaya LG Padada CO San Francisco WD San Pedro MPC CO San Pedro RACI CO Silay WD Tagbilaran LG Tandag WD Tibal-og RW Victorias WD *Other use includes industrial, commercial and institutional * No breakdown according to water use provided by Sta. Rosa. Percent Figure 2.9 Per Capita Consumption Tandag WD Carigara WD Bansalan WD San Pedro RACI CO Guimba WD San Francisco WD Tibal-og RW Calapan PS Utilities Tagbilaran LG Nueva Vizcaya LG Silay WD Muñoz WD Sta. Rosa WD Darasa RW Argao CO Victorias WD Jagna LG Buhi CO San Pedro MPC CO Padada CO Liters Per Capita Per Day Philippines Small Towns Water Utilities Data Book 25

37 Figure 2.10 Monthly Household Consumption Tandag WD Metro Carigara WD Bansalan WD San Pedro RACI CO Calapan PS Guimba WD San Pedro MPC CO Padada CO Utilities Tibal-og RW Jagna LG Tagbilaran LG San Francisco WD Nueva Vizcaya LG Silay WD Sta. Rosa WD Argao CO Buhi CO Muñoz WD Victorias WD Darasa RW Cubic Meters per Month Figure 2.11 Monthly Household Bill Nueva Vizcaya LG Jagna LG Buhi CO Calapan PS Tagbilaran LG San Pedro MPC CO Argao CO Tibal-og RW Utilities Padada CO San Pedro RACI CO Tandag WD Darasa RW Metro Carigara WD San Francisco WD Silay WD Victorias WD Muñoz WD Sta. Rosa WD Bansalan WD Guimba WD Average Monthly Household Bill (PhP) 26

38 Management Figure 2.12 Unaccounted-for Water Muñoz WD Sta Rosa WD Padada CO San Pedro RACI CO Tibal-og RW San Francisco WD San Pedro MPC CO Darasa RW Utilities Argao CO Jagna LG Bansalan WD Victorias WD Guimba WD Buhi CO Silay WD Tandag WD Carigara WD Calapan PS Tagbilaran LG Nueva Vizcaya LG Percentage Unaccounted-for Water Figure 2.13 Consumer Metering 10 8 Calapan Bansalan Number of Utilities Guimba Muñoz Nueva Vizcaya Argao Buhi Darasa San Pedro RACI Jagna Tagbilaran Padada San Francisco Silay Sta. Rosa Tandag Victorias Tibal-og Metro Carigara San Pedro MPC <90% 90-95% 96-99% 100% % of Connections Metered Philippines Small Towns Water Utilities Data Book 27

39 Figure 2.14 Staff Per 1000 Connections San Pedro RACI CO Tandag WD Argao CO Tibal-og RW Jagna LG Nueva Vizcaya LG Padada CO Darasa RW Utilities Silay WD Sta. Rosa WD San Francisco WD Muñoz WD Victorias WD Buhi CO Metro Carigara WD San Pedro MPC CO Calapan PS Bansalan WD Tagbilaran LG Guimba WD Staff per 1000 Connections Figure 2.15 Average Tariff Nueva Vizcaya LG Jagna LG Buhi CO Argao CO Tagbilaran LG San Pedro MPC CO Padada CO Calapan PS Utilities Darasa RW Tibal-og RW San Pedro RACI CO Silay WD Victorias WD Muñoz WD Sta. Rosa WD San Francisco WD Metro Carigara WD Tandag WD Guimba WD Bansalan WD Average Tariff (Php per Cubic Meter) 28

40 Figure 2.16 Unit Production Cost Nueva Vizcaya LG Jagna LG Buhi CO Tagbilaran LG Argao CO San Pedro MPC CO Tibal-og RW Darasa RW Utilities Calapan PS Padada CO Victorias WD Metro Carigara WD Sta. Rosa WD Silay WD San Francisco WD San Pedro RACI CO Muñoz WD Bansalan WD Tandag WD Guimba WD Production Cost (Php per Cubic Meter) Figure 2.17 Management Salaries Victorias WD Silay WD Bansalan WD Metro Carigara WD San Francisco WD Muñoz WD Tandag WD San Pedro MPC CO Utilities Sta. Rosa WD Nueva Vizcaya LG Guimba WD Tagbilaran LG Tibal-og RW Argao CO Padada CO Darasa RW San Pedro RACI CO Buhi CO Jagna LG *No data for Calapan was available Average Salaries of Top Three Management Positions (Php 1,000 per Month) Philippines Small Towns Water Utilities Data Book 29

41 Figure 2.18 Connection Fee for House Connection Jagna LG* Tagbilaran LG* San Pedro MPC CO* Tibal-og RW Buhi CO San Francisco WD Victorias WD Bansalan WD Utilities Guimba WD Muñoz WD Padada CO Tandag WD Sta. Rosa WD Silay WD Metro Carigara WD Darasa RW Nueva Vizcaya LG Argao CO San Pedro RACI CO Calapan PS Connection Fee (Php) Utilities Priority Needs of Utilities Table 2.3 Priority Needs of Utilities Argao Prevention of contamination of water sources during floods Increase of production capacity from spring sources Bansalan Development of new sources Computerization and construction of administration building Buhi Improvement of transmission mains Expansion of service area Calapan Sufficient volume of water for distribution Quality of water distributed Darasa Financial assistance Technical assistance Guimba Independent water systems for Barangays Consuelo, Cabarua, Triala and Culong Additional pumps and motors for Sta. Veronica, Bantug and San Roque pumping stations Jagna Rehabilitation of the waterworks system Increase in water rates Metro Carigara NRW reduction program Collection efficiency Muñoz Expansion to other barangays Upgrading to a hydraulically efficient water distribution system Nueva Vizcaya Rehabilitation of the existing system Design and development of a fully computerized collection system Padada Funding for expansion Technical training such as plumbing San Francisco Watershed protection and source development Expansion programs to other barangays San Pedro MPC Additional submersible pump and water tank Rehabilitation of pipelines San Pedro RACI Replacement of main pipes Rehabilitation of 8 deep wells Silay Computerization of system Iron removal facility Sta. Rosa Additional sources of water Extension of distribution pipelines Tagbilaran Financial support Technical seminars on operation and maintenance Tandag Additional water source Expansion of distribution lines, putting up reservoir and filtration plant Tibal-og Non-revenue water reduction Additional pumping station Victorias Elevated storage tank Full computerization 30

42 Financial Figure 2.19 Domestic Tariff Structures Group 1 (Tandag, Muñoz, Guimba, Metro Carigara) Tariff Rate in Php per Cubic Meter Tandag Muñoz Guimba Metro Carigara Monthly Household Consumption (Cubic Meters) Figure 2.20 Domestic Tariff Structures Group 2 (San Francisco, Sta. Rosa, Calapan, Victorias) Tariff Rate in Php per Cubic Meter San Francisco Santa Rosa Calapan Victorias Monthly Household Consumption (Cubic Meters) Philippines Small Towns Water Utilities Data Book 31

43 Figure 2.21 Domestic Tariff Structures Group 3 (Buhi, Tibal-og, Jagna, Nueva Vizcaya) Tariff Rate in Php per Cubic Meter Buhi Tibal-og Jagna Nueva Vizcaya Monthly Household Consumption (Cubic Meters) Figure 2.22 Domestic Tariff Structures Group 4 (Argao, Padada, Darasa, Tagbilaran) Tariff Rate in Php per Cubic Meter Argao Padada Darasa Tagbilaran Monthly Household Consumption (Cubic Meters) 32

44 Figure 2.23 Domestic Tariff Structures Group 5 (Silay, Bansalan, San Pedro RACI, San Pedro MPC) Tariff Rate in Php per Cubic Meter Silay Bansalan San Pedro RACI San Pedro MPC Monthly Household Consumption (Cubic Meters) Figure 2.24 Accounts Receivable Sta. Rosa WD Nueva Vizcaya LG Buhi CO Tandag WD Muñoz WD Guimba WD San Francisco WD San Pedro RACI CO Utilities Silay WD Victorias WD Bansalan WD Calapan PS Darasa RW Argao CO Metro Carigara WD Tibal-og RW San Pedro MPC CO Padada CO Jagna LG *No data for Tagbilaran was available Accounts Receivable (Months) Philippines Small Towns Water Utilities Data Book 33

45 Table 2.4 Cost of Water for Domestic Use (House Connections) Utility Cost of 10 m 3 (Php) Utility Cost of 20 m 3 (Php) Utility Cost of 30 m 3 (Php) Utility Cost of 50 m 3 (Php) Silay WD 200 Silay WD 420 Silay WD 680 Silay WD 1,390 Bansalan WD 170 Bansalan WD 370 Bansalan WD 600 Bansalan WD 1,150 Carigara WD 151 Tandag WD 317 Tandag WD 521 Tandag WD 1,032 Tandag WD 144 Carigara WD 310 Carigara WD 484 Carigara WD 925 Guimba WD 140 Guimba WD 292 Guimba WD 458 Guimba WD 846 Sta. Rosa WD 138 Muñoz WD 277 Sta. Rosa WD 426 Sta. Rosa WD 766 Muñoz WD 136 Sta. Rosa WD 276 Muñoz WD 426 Muñoz WD 763 Calapan PS 130 Calapan PS 268 Calapan PS 415 Calapan PS 758 Victorias WD 108 Victorias WD 224 Victorias WD 362 Victorias WD 727 San Francisco WD 105 San Francisco WD 222 San Francisco WD 353 San Francisco WD 666 Darasa RW 82 San Pedro MPC CO 175 San Pedro MPC CO 290 San Pedro MPC CO 550 San Pedro MPC CO 80 Darasa RW 169 Darasa RW 262 Darasa RW 447 San Pedro RACI CO 80 San Pedro RACI CO 162 San Pedro RACI CO 246 San Pedro RACI CO 420 Argao CO 65 Argao CO 135 Tibal-og RW 210 Tibal-og RW 390 Padada CO 65 Tibal-og RW 129 Argao CO 210 Argao CO 370 Tibal-og RW 60 Padada CO 128 Padada CO 203 Padada CO 368 Tagbilaran LG 56 Tagbilaran LG 118 Tagbilaran LG 188 Tagbilaran LG 358 Nueva Vizcaya LG 40 Jagna LG 55 Buhi CO 90 Buhi CO 175 Jagna LG 25 Nueva Vizcaya LG 55 Jagna LG 88 Jagna LG 158 Nueva Vizcaya LG 85 Nueva Vizcaya LG 155 Figure 2.25 Operating Ratio Jagna LG Sta. Rosa WD Bansalan WD San Francisco WD Metro Carigara WD Muñoz WD Tibal-og RW Victorias WD Utilities Darasa RW San Pedro MPC CO Tandag WD Guimba WD Buhi CO Tagbilaran LG Argao CO Padada CO Silay WD San Pedro RACI CO Nueva Vizcaya LG Calapan PS Operating Ratio (Expenses / Revenues) 34

46 Figure 2.26 Revenue Collection Efficiency Jagna LG Darasa RW San Pedro MPC CO Calapan PS Buhi CO Nueva Vizcaya LG San Pedro RACI CO Silay WD Utilities Victorias WD Bansalan WD Argao CO Muñoz WD San Francisco WD Padada CO Sta. Rosa WD Tibal-og RW Metro Carigara WD Tandag WD Guimba WD Tagbilaran LG Percentage Collection over Billings Philippines Small Towns Water Utilities Data Book 35

47 Operation and Maintenance Figure 2.27 Annual Operation and Maintenance Costs Jagna LG San Pedro MPC CO Buhi CO Nueva Vizcaya LG Darasa RW Padada CO Argao CO Tibal-og RW Utilities Tagbilaran LG Sta. Rosa WD Guimba WD Muñoz WD San Francisco WD San Pedro RACI CO Metro Carigara WD Bansalan WD Calapan PS Tandag WD Victorias WD Silay WD Annual O&M Costs (Php Million) Personnel Power/Fuel Others Figure 2.28 O&M Cost Components Argao CO Bansalan WD Buhi CO Calapan PS Darasa RW Guimba WD Jagna LG Metro Carigara WD Utilities Muñoz WD Nueva Vizcaya LG Padada CO San Fancisco WD San Pedro MPC CO San Pedro RACI CO Silay WD St. Rosa WD Tagbilaran LG Tandag WD Tibal-og RW Victorias WD Percent 36

48 Figure 2.29 Leaks Repaired San Pedro MPC CO Guimba WD Nueva Vizcaya LG Darasa RW San Francisco WD Muñoz WD Tibal-og RW Buhi CO Utilities Victorias WD Silay WD Tagbilaran LG Jagna LG Padada CO Sta. Rosa WD San Pedro RACI CO Metro Carigara WD Argao CO Tandag WD Calapan PS Bansalan WD ,000 1,250 1,500 1,750 No. of Leaks Repaired Annually Figure 2.30 Meters Replaced Tagbilaran LG Jagna LG Guimba WD San Pedro MPC CO San Pedro RACI CO Argao CO Nueva Vizcaya LG Buhi CO Utilities Darasa RW Padada CO Victorias WD Sta. Rosa WD Tandag WD Bansalan WD Tibal-og RW Muñoz WD Silay WD Metro Carigara WD San Francisco WD Calapan PS 1, No. of Meters Replaced Philippines Small Towns Water Utilities Data Book 37

49 Figure 2.31 Water Quality Sampling Passed Failed Jagna LG San Pedro MPC CO Silay WD Padada CO Calapan PS Nueva Vizcaya LG Darasa RW Muñoz WD Utilities Sta. Rosa WD San Pedro RACI CO Guimba WD Metro Carigara WD Buhi CO Tibal-og RW Tandag WD Bansalan WD Argao CO Victorias WD Tagbilaran LG San Francisco WD No. of Samples Passed/Failed Figure 2.32 Complaints Received San Pedro MPC CO Tagbilaran LG Nueva Vizcaya LG Buhi CO Victorias WD Tibal-og RW Darasa RW Sta. Rosa WD Utilities Padada CO Muñoz WD Jagna LG Silay WD Metro Carigara WD Argao CO Tandag WD San Francisco WD Bansalan WD San Pedro RACI CO Calapan PS 5, No. of Complaints Received Annually *No data for Guimba was available 38

50 Figure 2.33 New Connections Nueva Vizcaya LG San Pedro MPC CO Buhi CO Jagna LG Calapan PS Darasa RW Muñoz WD Padada CO Utilities San Pedro RACI CO Metro Carigara WD Argao CO Tibal-og RW Victorias WD Bansalan WD Silay WD Tagbilaran LG Guimba WD Tandag WD San Francisco WD Sta. Rosa WD No. of New Connections Per Year Philippines Small Towns Water Utilities Data Book 39

51 Supplying water to urbanizing Philippines is one of the country s biggest challenges in the new millennium. Water suppy utilities need to be able to expand to meet demand in their growing markets. Aearial photograph of Sta. Rosa, Laguna care of Google Earth (2005) 40

52 PART III WATER UTILITY AND AREA PROFILES Philippines Small Towns Water Utilities Data Book 41

53 ARGAO Utility Profile Water Utility COMMUNITY WATER AND SANITATION SERVICE COOPERATIVE Mission Statement General Data About Water Utility Address : Nicolas Ortega Street, Poblacion, Argao, Cebu Telephone : (63 32) Fax : (63 32) none Head : Mr. Eliezer E. Sarmago, Chairman, Board of Directors Community Water and Sanitation Service Cooperative (COWASSCO) was established in The water supply system was constructed under an AusAID funding grant. COWASSCO is responsible for water supply in 8 out of 45 barangays of the municipality of Argao, which has a total population of 61,010. Its present service area has a population density of 1,159 persons/km 2. The utility draws water from 3 deep wells and a spring source. Tariffs are approved by members of the cooperative during its regular general assembly meetings. The utility has a well developed management information system. Its development plan for is aimed at increasing production capacity to serve the other barangays. COWASSCO submits an annual report to the NWRB. COWASSCO commits to effectively serve its members, consumers and the people of the community with continuous supply of water for the improvement of their quality of life through the protection of its water sources and by implementing relevant programs and projects in harmony with the ecology and environment. Connections : 2,711 Staff : 14 Annual O&M Costs : Php4,783,820 Annual Collections : Php4,572,354 Annual Billings : Php4,637,208 Total Capital Expenditure : Php15,085,949 Average capital expenditure/connection/year: Php1, (Over the last 5 years) Source of Investment Funds: 80% government grant, 11% coop members deposit, and 9% internally generated reserves Tariff Structure (Effective 1 April 2004) Category Residential* * Institutional MINIMUM CHARGE (Php) (Php) (Php) (First 10 m 3 or less) COMMODITY CHARGE Consumption (m 3 ) (Php/m 3 ) (Php/m 3 ) (Php/m 3 ) up *Rates apply to regular members of the cooperative. Non-regular members pay Php10.00 more for the minimum charge and Php1.00/m3 more for the commodity charge. Notes: 1. All consumers pay on metered use. They are billed monthly and pay through bill collectors. 2. Tariffs are approved by the members during the regular general assembly meeting and are regulated by NWRB. 3. A total of 143 new connections were made in The cost of a new connection is Php3,350, payable within 12 months. 4. There is no sewerage charge on the water bill. Priority Need of Utility 1. Prevent contamination of water sources during floods. 2. Increase production capacity from spring sources. Consumer Service Average monthly consumption is about 22.4 m 3 per household of 6 persons. The water bill averages Php per month per household. Water is available 22 hours a day to most users. Applicants have to wait for about days for a new connection. The connection fee is payable in 12 months. Water quality is good with all 72 water samples taken passing the bacteriological tests. A total of 1,305 consumer complaints were recorded and 978 leaks repaired in The utility has no specific policy for providing water for the poor. Performance Highlights COWASSCO provides water at 123 lpcd to its consumers at an average of 22 hours per day, but only 76.4% of the population in its service area is served due to limited source capacity. UFW of 16.6% is much better than the average. Both production and consumption (99%) are almost fully metered. Financial management needs to be improved with operating ratio at 1.03 and accounts receivable equivalent of 1.7 months, which is just above average. Average tariff is in the lowest quartile and will not be sufficient to develop new sources and expand coverage. The system was constructed using mostly foreign-sourced grant financing. It does not have enough internally generated reserves for capital development. Staff/1000 connections ratio at 5.2 is the third lowest. 42

54 ARGAO Area Profile ARGAO WATER SUPPLY Population: 20,462 1 Production/Distribution Average Daily Production Groundwater Surface Water Treatment Type 2 Storage Service Area 3 Distribution pipes 2,522 m 3 100% Chlorination 770 m sq km 36.0 km UFW 17% Others 7 4% 3% Domestic 76% Service Connections House (6 persons/hc) Public Tap Institutional Others TOTAL 2, ,711 5% Annual Water Use 920,678 m 3 Others 7 4% Service Indicators Service Coverage 4 Water Availability 5 Per Capita Consumption Average Tariff 76.4% 22 hours/day 123 l/c/d Php6.04/m3 Domestic 91% Efficiency Indicators Unaccounted-for Water 6 Non-Revenue Water Unit Production Cost Operating Ratio Accounts Receivable Staff/1,000 Connections 16.6% 16.6% Php5.20/m months 5.2 Notes: 1 Population refers to the present area served by the utility. 2 All 72 water samples taken in 2003 passed the bacteriological tests. 3 The total area of responsibility is 20.7 sq km. 4 The population not served by the water utility draws water from 4 other service providers. 5 Only 90% of consumers have 24-hour water supply; about 1,305 consumer complaints were registered in About 978 leaks were repaired and 30 meters were either replaced or repaired. 7 'Others' refer to institutional connections. 8 'Others' include administrative expenses and depreciation. Data as of 2003 Parts/ Materials 28% Annual Water Billings Php4,637,207 Others 8 14% Power 27% Annual O&M Costs Php4,783,820 Personnel 31% Philippines Small Towns Water Utilities Data Book 43

55 BANSALAN Utility Profile Water Utility BANSALAN WATER DISTRICT Mission Statement General Data About Water Utility Address : 1535 Ramon delos Cientos St., Bansalan, Davao del Sur, Philippines Telephone : (63 82) Fax : (63 82) Head : Mr. Paul J. Arches, General Manager Bansalan Water District (BWD) is a government corporation set up in Its original waterworks system started operating in 1964 as part of the now defunct National Waterworks and Sewerage Authority (NAWASA). BWD is responsible for water supply in the town of Bansalan, which has a total population of 52,326. Its present service area, however, covers only 16 out of 25 barangays of Bansalan and has a population density of 738 persons/km 2. The utility draws water from 2 deep wells and 3 spring sources. Staff salaries, appointments and tariffs are under government influence. BWD submits to LWUA an annual report and monthly data sheets containing financial, consumer and operational data. To provide efficient, safe and potable drinking water to all Bansaleños at affordable cost. Connections : 3,551 Staff : 34 Annual O&M Costs : Php10,768,704 Annual Collections : Php14,667,835 Annual Billings : Php14,905,140 Total Capital Expenditure : Php17,197,539 Average capital expenditure/connection/year: Php (Over the last 5 years) Source of Investment Funds : 73% internally generated reserves 27% employees cooperative fund Tariff Structure (Effective 1 October 2001) Category Domestic MINIMUM CHARGE (Php) (Php) (First 10 m 3 or less) COMMODITY CHARGE Consumption (m 3 ) (Php/m 3 ) (Php/m 3 ) up Notes: 1. All consumers pay on metered use. They are billed monthly and pay through banks or at the water utility office. 2. Tariffs are regulated by the LWUA. 3. There were 181 new connections in The cost of a new connection is Php2,100, payable within 12 months. 4. There is no sewerage charge on the water bill. Priority Need of Utility 1. Development of new water sources. 2. Computerization and construction of administration building. Consumer Service Performance Highlights Average monthly consumption is about 15.7 m 3 per household of 6 persons. The water bill averages Php per month per household. Water is available 18 hours a day to most users. Applicants have to wait for 2 days for a new connection. The connection fee is paid within 12 months. Water quality is good with all 72 samples taken passing the bacteriological tests. A total of 2,672 complaints were recorded and 1,650 leaks repaired in The utility has no specific policy for providing water for the poor. BWD has an operating ratio of 0.72 (the third lowest) although accounts receivable equivalent of 1.6 months is just average. It funded capital development using internally generated funds including the employees cooperative fund. The utility needs to improve customer satisfaction by increasing coverage (71.2%), water availability (18 hours/day), and per capita consumption (86 lpcd). Low consumption may be due to the average tariff of Php21.90/m3, which is the highest. Consumption is fully metered; production is not -- a circular orifice is used to estimate values. UFW at 20.8% can still be improved, although it is lower than the average. Staff/1000 connections ratio of 9.6 is third highest and needs to be reduced. 44

56 BANSALAN Area Profile BANSALAN WATER SUPPLY Population: 28,422 1 Production/Distribution Average Daily Production 2,354 m 3 /d Others 7 2% 3% UFW 21% Groundwater 100% Surface Water Treatment Type 2 Chlorination Storage Service Area m sq km Domestic 74% Distribution pipes 60.7 km Service Connections House (6 persons/hc) Public Tap Institutional Others TOTAL 3, ,551 Annual Water Use 859,261 m3 8% Others 7 3% Service Indicators Service Coverage 4 Water Availability 5 Per Capita Consumption Average Tariff Efficiency Indicators Unaccounted-for Water 6 Non-Revenue Water Unit Production Cost Operating Ratio Accounts Receivable Staff/1,000 Connections 71.2% 18 hours/day 86 l/c/d Php21.90/m % 20.8% Php12.53/m months 9.6 Annual Water Billings Php14,905,140 Others 8 42% Domestic 89% Notes: 1 Population refers to the present area served by the utility. 2 All 72 water samples taken in 2003 passed bacteriological tests 3 Total area of responsibility is 48.6 sq. km. 4 The population not served by the water district draws water from other service providers, dug wells and rain collectors 5 Only 85% of consumers have 24-hour water supply; about 2,672 consumer complaints were registered in About 1,650 leaks were repaired and 208 meters were either replaced or repaired. 7 'Others' refer to institutional connections. 8 'Others' include transportation, depreciation and other personnel benefits. Parts/ Materials 13% Power 9% Personnel 36% Annual O&M Costs Php10,768,704 Data as of 2003 Philippines Small Towns Water Utilities Data Book 45