AUDIT OF ALEXANDRIA SEWERAGE TOP PRIORITY PROJECTS

Evaluation covers the period 9/29/77-3/31/81 and is based on an audit review of files and documentation supporting selected expenditures, visits to all project construction sites, and discussions with project personnel. A total of $5.3 million of the $15 million loan has been expended to date. Achievements include completed designs for 11 major construction projects, awarding of five construction contracts, initiation of construction on four projects, and placement of orders for $2.6 million worth of sewer cleaning and maintenance equipment. However, the project"s primary objective, establishment of a viable solid waste collection system and enforcement of sewer use laws to counteract a long-standing practice of dumping solid wastes into the sewer system remains unachieved. Work towards it stopped in 6/80 after pilot activities by the consultant, Camp Dresser and McKee, Inc. (CDM), proved unsatisfactory to the implementing agency, the Alexandria General Organization for Sanitary Drainage (AGOSD). Nevertheless, USAID/E"s exceptional knowledgeability of the project and its intensive monitoring of Alexandria wastewater activities augur well for the project"s ultimate success. It is recommended that USAID/E exert all possible management prerogatives to have the project"s main objective achieved. Several problems have occurred with respect to payments to CDM. To correct these problems, it is recommended that: (1) the A.I.D. General Counsel determine the propriety of the Special Area Allowances payments (which resemble payments for Federal taxes) to CDM, and USAID/E implement his decision; (2) USAID/E seek AID/W"s guidance on the acceptability of reimbursing for procurement services on the basis of percentage of costs and establish acceptable methods of payment for CDM purchases; and (3) CDM refund $3,250 in payments found unallowable or not properly documented for vehicle depreciation and $5,000 in erroneous payments for excess baggage charges, and properly document air travel expenses or refund the entire $200,000 paid.