THE IMPLEMENTATION OF IMPROVEMENT PROJECTS THROUGH AID ON DELIVERY (AOD) PROGRAMME 2022 – WATERFUND

WATER SECTOR TRUST FUND TENDER APRIL 2022 

AID ON DELIVERY (AOD) PROGRAMME

Water Sector Trust Fund (WaterFund) is a State Corporation under the Ministry of Water, Sanitation and Irrigation. It was established under the Water Act, 2016, as a water sector financing institution with the mandate to provide conditional and unconditional grants to counties, and to assist in financing the development and management of water services in marginalised or underserved areas.

WaterFund has received funding from the Government of Kenya and the Government of Germany via the German Development Bank (KfW) to finance the implementation of improvement projects, through  Aid on Delivery (AoD) programme. The financial incentives (subsidies) provided under the AoD programme are to support eligible Water Services Providers (WSPs) to expand, extend, rehabilitate, or modernise urban water supply, sewerage and sanitation services, and customer services.

AID ON DELIVERY (AOD) PROGRAMME

The Aid on Delivery (AoD) programme supports projects that directly benefit customers of WSPs with improved water and/or sanitation services as measured by pre-determined targets related to both output and outcome. AoD support is provided through financial incentives (subsidies) paid to WSPs which invest in infrastructure and customer service improvements. WSPs which obtain commercial loans to pre-finance these investments are eligible for AoD programme subsidies worth up to 50% of the total eligible investment costs. The payment of AoD subsidies is con­ditional upon the WSP achieving agreed targets for outputs and outcomes, which are built into the project design. The project brief is the basis for WaterFund’s decision to accept or reject proposed projects for financial support in the preparatory stage under the AoD facility. The evaluation criteria used to assess the suitability and qualification of the proposed project brief is provided in the AoD Concept and Procedures Manual Revision 1 (2016).

While AoD offers a degree of flexibility with the scope of work of the proposed projects considered to be suitable, the selection of the project briefs submitted by the WSPs will be based on the relevance and achievability of the proposed indicators, expressed as output and outcome targets. WSPs submitting project briefs with high technical and financial viability will be invited to prepare detailed designs and procurement documents for ‘bankable’ project proposals.

ELIGIBILITY REQUIREMENTS FOR WATER SERVICE PROVIDERS

To apply for a results-based finance subsidy under AoD, the WSP must meet the following requirements:

1. Legal requirements: proof of a valid license to operate as a WSP (Service Provision Agreement), or if lapsed, to provide proof of the renewal application to WASREB
2. Support documentation: shall be provided to legitimise critical data included in the project brief
3. No red flags: outstanding against any WaterFund projects from the WSP
4. No litigation: is in process or pending against the WSP

ELIGIBILITY REQUIREMENTS FOR AOD PROJECTS

To qualify for a results-based finance subsidy under AoD, the proposed project must meet all the following criteria:

1. Project benefits must be linked to and improve service delivery to the customers of the WSP
2. Project impact must be measurable through clearly defined targets linked to output and outcome
3. Project value (estimate) must be within the threshold of KES 20 million and ceiling of KES 150 million
4. Equity financing (10% minimum, 40% maximum) shall be provided by the WSP and/or County Government
5. Exclusivity of project financing must be guaranteed through a statement to ensure that the project is or shall not be double financed from other sources

APPLICATION PROCEDURE

WaterFund invites interested WSPs to prepare and submit a project brief using the application forms and the appli­cation procedures in Annex 1 in the AoD Concept and Procedures Manual Revision 01 (May 2016), which can be downloaded from the webpage: https://waterfund.go.ke/downloads/proposals. Alternatively, this document can be obtained from the WaterFund by submitting a written request to urban@waterfund.go.ke.

• The application by the WSP, in addition to the application forms, should include all the required supporting documents.
• Eligible WSPs can submit a maximum of one project brief. The project brief can comprise multiple smaller interventions, but all the planned interventions in a project brief should be within the jurisdiction of the WSP.
• The submitted project brief must be endorsed and approved by the respective County Government before submission
• All project briefs must be submitted in four hard copies together with an electronic version on a USB flash drive, in a plain envelope clearly marked ‘AoD 2nd Call for Proposals’ to the address below:

The Chief Executive Officer,

Water Sector Trust Fund,

1st Floor, CIC Plaza 1, Mara Road, Upper Hill,

PO Box 49699-00100, Nairobi.

CLOSING DATE

To be considered, proposals must be received by WaterFund before or by 5:00 PM (EAT) on 10^th  May 2022. For enquiries, email: urban@waterfund.go.ke or Tel: +254 20 272 90 17 / 8.

WaterFund is the Winner of prestigious 2021 United Nations Public Service Awards (UNPSA). For more information, see: https://waterfund.go.ke/2021unpsa

For WaterFund’s complaints and access to information procedures and redress mechanisms, kindly follow the link: https://waterfund.go.ke/access2info

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