Terms of Reference (TOR)

for

An assessment on Pit Emptying Tariff Structure

Project: Up scaling Faridpur city best practices and continued support in Faridpur City, Bangladesh

1. Project Background

Practical Action have been implementing a project titled ‘Up scaling Faridpur city best practices and continued support in Faridpur City, Bangladesh’ in Faridpur and other four municipalities in Bangladesh with a funding support from Bill & Melinda Gates Foundation. In Faridpur, informal pit emptiers have been organising and supporting to transfer themselves as private entrepreneurs to run the mechanical desludging business. To make it institutional, a Service Level Agreement (SLA) has been signed between Faridpur municipality and business cooperatives of informal groups. The cooperatives received emptying equipment’s and vehicles from municipality through lease agreements. The groups are gradually growing their business and the model has been agreed to be replicated in four other municipalities where; Urban Governance Infrastructure and Improvement Project’s Phase-3 (UGIIP3) is also working. For emptying service fee, Faridpur Municipality has adopted an ad-hoc tariff structure based on number of trips per containment and wellbeing status of the clients.  The tariff issue is highlighted in the Institutional and Regulatory Framework (IRF) for Faecal Sludge Management (FSM), which was approved and launched, by Ministry of Local Government, Rural Development and Cooperatives (MoLGRD&C) in 2017. Since, tariff has big influence on sustainable growth of the business, this need to be standardized and developed in a participatory and transparent way in line with existing relevant policies and acts by the local and national government.

For this, Practical Action will commission a study to analyse different practices by WASAs, City Corporations and Municipalities, private companies, business cooperatives, NGOs and community associations and assess financial sustainability of the services. The study will recommend a standard tariff structure in the context of secondary towns and for participation of SMEs in delivering emptying and safe disposal services.

2. Key objective of the study

The study will critically review the cost for sludge emptying and transportation services in the context of secondary towns in Bangladesh and recommend a pro poor tariff structure so that private sector can participate and support municipalities to extend improve services for all including slum dwellers, low income communities, household, institutional and commercial customers.

3. Scope of Work

The scope of work for the external consultant/farm will be:

• Assess existing practices at Municipalities/City Corporations/WASAs and “strengths & weaknesses” of the practices
• Consultation with private sectors who are currently running emptying business; to know about their tariff structure
• Review Rules, acts, laws of different authorities like WASA, DPHE, Municipalities etc. and regulatory commission (if applicable) for determining the scopes of tariff setting;
• Financial analysis of at least three (one by public organisation and two by private companies/cooperatives) business cases (where the entities are practicing mechanical emptying & safe disposal)
• Customer’s perception including slum dwellers and low income communities on tariff for emptying pits/septic tanks
• Identification of factors which need to be considered in setting tariff
• Recommend a structure in context of Faridpur so that this can be replicated in new four towns where Practical Action will support municipalities for improving the services.  towns.

4. Methodology

The consultant/firm is expected to propose the methodology for undertaking this assignment. Practical Action will evaluate the proposals and provide necessary input if required to the accepted proposal.    

5. Outputs/ deliverables  

• An operational plan of the study agreed by Practical Action and the Faridpur Municipality
• A presentation on recommended tariff structure with justification and this need to be presented in front of Municipal Authorities, Municipality Staffs and Project Staffs;
• A report comprising detailed analysis on how the recommendations are prepared and in which context which tariff recommendation is applicable. The report will include detailed financial worksheets as reference to the description. The tariff structure should be recommended in both volumetric (per cubic meter or per thousand litres) and distance to travel for safe disposal.

6. Indicative timeframe

The selected consultant/firm will develop a detailed work plan and timeframe, and seek approval from Practical Action. However, the assignment needs to be completed by 09 September 2018. A tentative timeframe is added in the table below-

7. Coordination and reporting

The Consultant/firm will report to Md. Shareful Hassan, Manager- Monitoring & Evaluation, Learning and Research (MELR) for all sorts of communication and technical aspects. He can be reached through shareful.hassan@practicalaction.org.bd. For anything related to the project, Mr. Md. Nazmul Huda (nazmul.huda@practicalaction.org.bd) can be contacted.

8. Eligibility: The consultant/ firm must have

The consultant can be individual or collection of individuals or a firm. Following eligibility requirement are also considerable during selection of the consultant:

• Experience in conducting financial research and business modelling, priority will be given to the consultant(s)/firm having experience in tariff design and similar experience which is relevant to this ToR;
• Track record on application of scientific methods for pricing and; analytical knowledge on technical, business, environmental and socio-economic perspective of any services preferably any public services;
• Excellent facilitation & communication skills;
• Lead consultant should have an educational background in business administration/marketing/financial analysis/economics etc.

9. Payment and Financial Modality  

• The payment for the consultancy will be made through check. All TAX and VAT will be deducted at source at the rate of movement of Bangladesh order for the year.
• 30% of the total budgeted amount will be paid on receipt of detailed methodology, survey tools and satisfactory work plan. 
• The remaining 70% will be paid on receipt of a satisfactory final report presentation and submission. The payment will be done through account payee cheque.
• Practical Action will preserve the copyright of the study and the primary database structured while conducting the study

10. Proposals evaluation

A proposal (describing technical approach, methodology and budget) of maximum five (5) pages should be emailed to practicalaction@practicalaction.org.bd  by 16 July 2018. Please include detailed CV/s of individuals’/key persons focusing relevant experience. Practical Action reserves sole right to select the consultant.