European Investment Bank - European...

European Investment BankJESSICA Evaluation Study

Implementing JESSICA Instruments in the Campania Region

29 October 2010

Submitted by: PricewaterhouseCoopers

This document has been produced with the financial assistance of the European Union. The

views expressed herein can in no way be taken to reflect the official opinion of the European Union.

Date:

29 October 2010

Client Name:

European Investment BankJESSICA Task Force

Final Report:

JESSICA Evaluation Study


Document version:

Jessica Campania Final Report 2.3._light.docx

Submitted by:

PricewaterhouseCoopers Advisory SpALargo Angelo Fochetti 2800154 RomaItaliaTelephone +39 06 570831Facsimile +39 06 570832536www.pwc.com

JESSICA Evaluation Study. Implementing JESSICA Instruments in the Campania Region- Final Report

pwc 3

Table of contents

Table of abbreviations 4

Executive summary 5

1 Contents of the Report 16

2 Description of the activities carried out 18

2.1 Introduction 18

3 Implementing JESSICA in the Campania Region 21

3.1 The Regional Context 21

3.1.1 Regional priorities for urban planning 21

3.1.2 Planning instruments in place 22

3.1.3 Instruments in place for the implementation and financing of urban regeneration initiatives 23

3.1.4 Other domestic and European programs and initiatives 25

3.2 Analysis of the initiatives in place under the Operational Objective 6.1 of ERDF OP 27

3.2.1 “PIU Europa” initiative 27

3.2.2 “Altre Città” initiative 41

3.2.3 Conclusions 41

3.3 JESSICA Instruments in the Campania Region: architecture of the initiative 42

3.3.1 Expected benefits deriving from the adoption of JESSICA instruments 42

3.3.2 Organisational legal and financial structure of the initiative 43

3.4 Investment strategy 47

3.4.1 Introduction 47

3.4.2 Investment Strategy 47

3.5 Planning of the implementation phase 48

4 Quantitative simulation of the initiative 50

4.1 Introduction 50

4.1.1 Analysis of Projects 51

4.1.2 Analysis of UDF and HF 67

Annex 1- Identification and analysis of pilot projects

Annex 2- Structure of JESSICA instruments in Campania Region

Annex 3- Investment Strategy and Planning

Annex 4- Application form Altre Città

Annex 5- Results of specific analyses

Annex 6- Presentations

Annex 7- Description of the activities carried out


PwC 4

ACG Area Generale di Coordinamento

CIPE Interdepartmental Committee for Economic Planning

DGR Deliberazione della Giunta Regionale (Regional Committee Deliberation)

DOS Documento di Orientamento Strategico (City Strategy Development Guidelines)

EAFRD European Agricultural Fund for Rural Development

EC European Commission

EIB European Investment Bank

ERDF European Regional Development Fund

ESF European Social Fund

EU European Union

FAS Fondo Aree Sottoutilizzate

FI Financial Institution

FTE Full-Time Equivalent

HF JESSICA Holding Fund

IACP Istituto Autonomo Case Popolari

IB Investment Board

IRR Internal Rate of Return

JESSICA Joint European Support for Sustainable Investment in City Areas

JTF JESSICA Task Force

MA Managing Authority

MGT Management

NSRF National Strategic Reference Framework

NVVIPNucleo di Verifica e Valutazione Investimenti Pubblici (Projects Evaluation and Verification

Committee)

OP Operational Programme

PIU Programmi Integrati Urbani (Integrated Urban Plans)

PPP Public-Private Partnership

PTR Piano Territoriale Regionale (Regional Territorial Plan)

ROO Responsabile di Obiettivo Operativo

SME Small Medium Enterprise

UDF Urban Development Fund

Table of abbreviations


PwC 5

Aim of the study and activities carried out

The aim of the study is to identify challenges and opportunities associated to the practical

implementation of JESSICA in the Campania Region, suggesting recommendations for its

implementation and for further steps towards introducing adequate financial engineering mechanisms.

In particular, the study:

Assesses the employment of JESSICA funds to support revenue-generating projects and/or

plan components included in the integrated urban planning initiatives already undertaken

within the Campania Region, giving priority to those established within the framework of 2007-

2013 ERDF Operational Programme (ERDF OP), Operational Priority 6.1 ( i.e. “PIU Europa”

and “Altre Città”).

Analyses the applicability of JESSICA, and its implementation, to other initiatives in place

under European (e.g. European Social Fund), national (e.g. Implementation Programme of

FAS, Programma Energia) and regional programmes (sustainable construction and affordable

housing).

Analyses the possible integration of JESSICA with other European policies aimed, for instance,

to enhance public safety or to improve quality of life in the Convergence Regions (i.e.

European Social Fund objectives) like Campania.

Identifies the structure of JESSICA operations that best fits with the constraints of the

JESSICA financial instruments and the objectives and expectations of the Managing Authority

(including the implementation model for the operation and the roles and responsibilities of the

parties - the EIB, the Managing Authority and the officer in charge of the Operational Objective

6.1. (“Responsabile per l’Obiettivo Operativo” o “ROO” 6.1) - and the benefits for all parties

involved.

Defines the associated Investment Strategy.

Identifies operational steps to be undertaken after the signature of the Funding Agreement.

Provides a simulation of the quantitative results of the JESSICA instruments.

The assignment was performed in two phases:

A preliminary evaluation phase, devoted at highlighting the benefits of introducing JESSICA

financial instruments in the context of the Campania Region, evaluating the applicability of JESSICA to

the initiatives in place within the ERDF OP for regenerating urban areas within the Region, drafting the

administrative path for the implementation of JESSICA. The output of this phase is the Interim Report;

A support to start-up phase, in which, starting from results of the preliminary phase, we have defined

the financial, organizational and legal structure of JESSICA instruments in the Campania Region,

identified the Investment Strategy and carried out ad-hoc analyses to clarify outstanding legal issues

and topics related to the use of Structural Funds. At this stage we have simulated the impact of the

initiative from a quantitative point of view, through the assessment of pilot projects, as well as

supported the Managing Authority in communicating benefits of JESSICA to the interested parties

(mainly municipalities and municipalities associations). The overall output of this phase is represented

by the Final Report. However, several intermediate outputs were also produced.

Executive summary


PwC 6

All the above mentioned activities were carried out in close cooperation with the JESSICA Task Force

(“JTF”). The analyses are based on information provided by the ROO 6.1. (promoter of the

introduction of JESSICA financial instruments in Campania) and its staff.

Implementing JESSICA instruments in the Campania Region

Campania was the first of the Convergence Regions to contemplate the possibility of incorporating

JESSICA instruments in the ERDF OP with the aim of employing JESSICA funds to support revenue-

generating projects and/or plan components included in the priority Axis 6.

As of today, the Campania Region has undertaken two main initiatives for the implementation of the

Operational Objectives of Axis 6, both under the Operational Objective 6.1.:

the “PIU Europa” initiative, aimed at urban regeneration in 19 medium-sized cities, identified

with DGR1

no. 282/2008;

the “Altre Città” initiative, aimed at urban regeneration in 21 medium-sized cities (not included

in the 19 from “PIU Europa”), identified with DGR no. 1026/2009.

Projects that can be financed through the two above mentioned initiatives will have the following

general objectives:

environmental recovery, social and economic regeneration;

renewal, regeneration and re-use of “waterfronts”;

renewal, regeneration and re-use of under-used or unused urban assets to create urban parks,

aggregation of shops in particular city areas to establish outdoor retail centres, handicraft labs,

expo areas, and social aggregation areas;

improvement of local mobility systems;

safety and security.

The PIU Europa is at an advanced completion status (administrative process required almost

completed by all cities, almost all urban development plans finalised, identified projects included in the

plans2), while the Altre Città initiative is in the start-up phase, with the administrative process started

shortly after the signature of the Funding Agreement, their urban integrated plans under development,

no project presented to the ROO so far.

The analysis performed during this study highlighted a high compatibility for the application of

JESSICA instruments to revenue generating projects included in both initiatives. The following table

outlines the main results of this analysis.

Applicability of JESSICA instruments to PIU Europa and Altre Città initiative

Parameters for theapplication of JESSICA

instruments

Main characteristics of the twoinitiatives

Conclusions

Inclusion of projects in

Integrated Plans for

Sustainable Urban

All projects developed and financed within

the Operational Objective 6.1. must be part

of a Integrated Urban Development

The implementation of the PIU Europa Integrated

Urban Development plans is almost completed.

The Altre Città initiative is at the start-up phase.

1 Deliberazione della Giunta Regionale (Regional Committee Deliberation).2 In some cases projects are ready to start the construction phase


PwC 7


instruments

Main characteristics of the twoinitiatives

Conclusions

Development Planning Process. Following the results of the Preliminary Evaluation

phase of this study the administrative process for

its implementation has been structured and

launched in accordance with JESSICA

requirements. In particular, cities are required to

develop Integrated Urban Development Plans.

Revenue-generating

initiatives

The screening of the PIU Europa projects

proposed up to now highlighted 15

revenue-generating projects out of 166 and

a number of other intervention that, if

aggregated in the appropriate way, could

become revenue-generating.

The Altre Città initiative is still in the start-

up phase. The ROO and its staff have

undertaken a process for stimulating cities

to produce and include in the Integrated

Urban Planning revenue-generating

projects.

In their meetings with the cities included in the PIU

Europa process, the ROO and its staff are

stimulating cities to partially re-configure presented

projects in order to make them revenue-

generating.

Generation of revenues by projects is one of the

eligibility criteria stated in the administrative

process launched for the implementation of “Altre

Città” initiative.

Part of expenses of projects

eligible for structural funds

Expenditures for intervention included in

the two initiatives must be eligible for

ERDF funding. However, in light of the

strong integration of the projects of the two

initiatives with other projects devoted to

urban regeneration, some components

may be only partially funded by ERDF or

not at all eligible to funding under ERDF.

Thus, eligibility of expenses for JESSICA

financing must be subject to a case by

case evaluation.

Expenditure for initiatives selected for financing

through JESSICA instruments will need to be at

least partially eligible for ERDF funding.

Non-eligible expenditure will be financed by other

investors (i.e. own funds of the Urban

Development Fund, private investors,

national/regional/EU free grants, institutional

investors, etc.).

Following the results of the analysis, the Campania Region showed interest in introducing JESSICA

instruments in the two initiatives, in order to:

take advantage of the revolving nature of financial engineering instruments established

through JESSICA. The use of financial engineering instruments enables the Managing

Authority to create a tool that will “re-constitute” the financial resources dedicated to urban

regeneration projects. Once returned, these resources will represent an independent supply of

funding, additional to other potential resources made available in future planning periods;

promote the development and implementation of long-term self-sustaining urban

investment. Aware of the importance of developing and supporting urban projects achieving

economic and financial returns along with purely socio-environmental benefits, the Managing

Authority seeks to encourage Local Authorities to plan investments assuring long-term

economic, social and environmental benefits, and simultaneously capable to be financially

self-sustainable;


PwC 8

develop the capacity of public entities to plan and promote the use of participative

design and planning methodologies. The use of JESSICA financial engineering is

dedicated specifically to initiatives included in Integrated Plans for Sustainable Urban

Development. As of today, the Campania municipalities have undertaken a process of

integrated urban planning based on a continuous public-private dialogue, taking into account

the private parties’ interest in being awarded free grants and/or obtaining land use changes. In

this context, the Managing Authority aims at triggering a virtuous process stimulating Local

Authorities to plan in a longer-term perspective, and promoting systematic participation of

stakeholders during the whole process - from the identification of territorial priorities to

elaborating development guidelines, drafting urban plans, and defining the technical,

economic and financial characteristics of projects. The introduction of innovative financial

instruments supporting, or substituting, free grants is crucial to move towards a system able to

generate long-lasting benefits;

attract private financing into urban regeneration projects. By creating a financial

instrument dedicated to finance public-private urban regeneration projects, including

environmentally sustainable buildings and initiatives connected with social housing, and

facilitating access to credit at competitive rates, the Managing Authority intends to attract

private capital into urban regeneration. Selected initiatives can be supported jointly by UDF

resources and public subsidies from other sources. Along these lines, a “Credit and

Guarantee Revolving Fund” is already in operation to assist urban investment projects,

specifically in favour of multi-annual programmes supporting public housing3

;

bring into JESSICA financial engineering instruments resources from other

programmes, such as the Implementation Programme of FAS (Fondo Aree Sottoutilizzate),

Piano Casa, Renewable Energy, as well as social housing, infrastructure, etc. to support

initiatives complementary to those envisaged under Operational Objective 6.1.

Funding agreement and main terms of the Investment strategy

On 25 March 2010, the Campania Region and EIB entered into a Funding Agreement for the purpose

of establishing the JESSICA Holding Fund for Campania (JESSICA HF or HF).

The Managing Authority decided to contribute with an initial amount of EUR 100 million into the

JESSICA HF. The JESSICA HF will invest in a Urban Development Fund (UDF) in order to contribute

to the implementation of two initiatives put in place by the Campania Region within the scope of

Operational Objective 6.1 (“PIU Europa” and “Altre Città” initiatives).4

If deemed appropriate, the Managing Authority will further contribute to the HF by bringing in additional

funds available under Operational Objective 6.1, or possibly from other sources such as FAS5under

the urban sustainable development priority, and those supporting schemes launched under the Piano

3 As provided in Regional Law no.1 of 30/01/2008, BURC no. 5 bis of 4/02/2008, disciplined by DGR no. 231 of 06/02/2008

“Linee Guida per la Programmazione in materia di Edilizia Residenziale Pubblica e fondi fitto”, as foreseen in Law 431/98.4 The Campania ERDF OP allocated EUR 775 million in support of urban regeneration and quality of life projects in medium-

sized cities under Operational Objective 6.1.: EUR 600 million have been allocated to Integrated Urban Plans of 19 medium-

sized cities identified with DGR n. 282/2008, EUR 100 million for financing the interventions of the 21 medium-sized cities under

the Altre Città initiative and EUR 75 million have been devoted to interventions in the Naples municipality.

The MA decided to contribute with an initial amount EUR 100 million into the JESSICA HF: these funds are part of the overall

amount of EUR 700 million (EUR 600 million + EUR 100 million) allocated to the two initiatives PIU Europa and Altre Città..5 Fondo per le Aree Sottoutilizzate (Fund for Underused Areas).


PwC 9

Casa. The definition and implementation of projects will pay particular attention to the integration

between renovation/recovery of existing buildings and new construction, as well as support to assisted

and subsidised housing, including new types of social housing, self-recovery and self-construction.

The JESSICA HF may only make investments (by means of a UDF investing through loans or equity

instruments) to support projects fulfilling the following criteria:

they are included in one of the two initiatives (PIU Europa and Altre Città);

offer an acceptable return on investment;

have received from the ROO a positive assessment on their compliance with the criteria

specified within Operational Objective 6.1.

The ROO will stimulate cities to elaborate projects aligned with the characteristics required by the

above investment selection criteria, will verify the coherence of proposed projects with the Operational

Objective 6.1 criteria and will promote integration between JESSICA instruments and other synergic

actions (e.g. Credit and Guarantee Revolving Fund, Priority 8 of the FAS Implementation Plan, Piano

Casa, ordinary funds, etc.) in order to pursue urban regeneration objectives.

In order to optimise the availability of funds to support projects, the UDF will also be stimulated to co-

finance projects using its own funds.

The figure below describes the overall architecture of the operation.


PwC 10

Overall architecture of the operation

The following figure summarises the time plan if the implementation phase of the introduction of

JESSICA financial instruments in the Campania Region.

JESSICACampaniaHolding Fund (HF)

HF Officer

UDF (FinancialInstitution)

HF InvestmentBoard (HF IB)

Local HF Officer

Projects

Privateinvestors

Più Europainterventions

Altre Cittàinterventions

ROO

ERDF OP FundsObjective 6.1.

Repayments

Equity/Loan

Repayments

Grant

Grant/Landcontribution

Eq

uity/L

oan

+M

anag

em

ent

Fee

Rep

aym

ents

Eq

uity/L

oan

Div

idend

s/

Reim

burs

em

ent

+In

tere

sts

EIB

FundingAgreement

CampaniaRegion

OperationalAgreement

Banks

CampaniaRegion

Cities

Loan

Repayments


PwC 11

Implementation phase planning6

Quantitative simulation of the initiative

A quantitative analysis was performed aimed at providing an overall assessment of the economic and

financial feasibility of the operation and at describing potential benefits for all parties involved.

On the base of the criteria below, 3 pilot projects for the simulation exercise were identified among the

Jessicable ones included in the “PIU Europa” initiative

amount of the investment (> EUR 5 million);

type of initiative (priority was given to those initiatives that could be replicated in other cities);

status of the implementation of the initiative (priority was given to initiatives in an advanced

feasibility phase, since they offered enough information for the analyses but could already be

shaped so to reach the highest results in terms of social benefits and profitability, if needed);

involvement of private partners;

the interest expressed by the city who promoted the project in taking part to the JESSICA

initiative.

The selected projects were a parking facility and square in Portici; the development of an educational

site in Scafati; the re-development of Ex Manifattura Tabacchi in Scafati. Key performance indicators

(IRR, Payback Period),were calculated for the three projects under four scenarios: Baseline (no use of

JESSICA financial instruments), JESSICA Loan (UDF invests in the project through JESSICA loan),

JESSICA Equity (UDF invests in the project through JESSICA Equity), JESSICA Equity and Loan

(UDF invests in the project through a mix of JESSICA Equity and JESSICA Loan). Depending on the

results for each project, the most promising way to use JESSICA instruments was identified.

6 This diagram relies on hypothesis formulated by PwC on the base of the overall planning of activities foreseen by the

Campania Region for the implementation of Operational Objective 6.1 as of August 2010. Real implementation of the Jessica

initiative may follow a different time plan

2010-2011

2012-2015Month1

Month2

Month3

Month4

Month5

Month6

Month7

Month8

Month9

Month..

OP funds transferinto HF

Appointment ofInvestment Board(IB) members

First meeting ofthe IB

Selection of thelegal consultants

Selection of theUDF

Investment Phase

Phase

Milestone

Legend


PwC 12

Then, the simulation was carried out at UDF and HF level. It involved:

the identification of the pilot projects mix that was best suited with the amount of funds to be

invested and expected financial results (projects portfolio);

the identification of the HF duration scenarios, based on timing for the initial contribution to

revolve back to MA;

the calculation of key performance indicators (IRR, Payback ) for the HF, the UDF, the

Financial Institution that manages the UDF and the Managing Authority.

The total volume of funded investment amounts to approximately EUR 143 million (EUR 66 million are

assumed to be “own funds” from UDF/Financial Institutions, EUR 43 million are JESSICA loan and

EUR 34 million are JESSICA equity). The simulated portfolio consists of 22 projects – 13 of the

“Parking and Square” type, 5 of the “Educational Site” type and 4 of the “Manifattura Tabacchi” type -

worth approximately EUR 287 million including free grants.

The analysis allowed quantifying main parameters of the structure of the JESSICA Initiative. Results

are summarised in the following figure.


PwC 13

Structure of the JESSICA initiative in the Campania Region (thousands EUR)7

Performance parameters of the operation were calculated from the HF, UDF, Financial Institution and

Managing Authority perspective

The Holding Fund perspective

HF: main performance indicators

Results for the HF reported in the table above show that the initiative will allow the HF to recover the

investment after 12 years8. If the HF were to be terminated at that time, it could not return to the MA

the total amount of funds initially contributed. Our simulation exercise assumes that the HF terminates

when all projects have repaid their debts to the UDF (after 23 years from the establishment of the HF).

7 X = number of projects.8 12 years (payback period) is the time required to recoup the initial amount of the investment. The parameter does not take into

account the time value for money.

Funding Agreement 100.000

Manager JTF

Funds Received 100.000

MGT Fees (24 years) 16.375

Funds Invested in UDF 83.625

Unused funds 0

83.625

Funds received 83.625

Mgt Fees (24 years) until 2015 4.534

from 2016 2.780

Funds invested in Projects 77.222

Unused Funds 1.869

43.280 Jessica Equity 33.943 66.029

Parking and square

in Portici13 X

Educational Site in

Scafati 5 X

Ex Manifattura

Tabacchi in Scafati4 X

Managing Authority

Holding Fund

Projects

Operational Agreement

UDF

Jessica LoanUDF-Financial

Institution

Commercial Loan

IRR (24 years) 6,1%

Payback (years) 12

Managed Funds (thousands EUR) 100.000

Management Fees over 24 years (thousands EUR) 16.375

Funds Invested in UDF (thousands EUR) 83.625

Jessica CAMPANIA

HOLDING FUND


PwC 14

The UDF perspective

The financial results for the UDF are split between performance of the UDF itself and performance of

the Financial Institution that manages the UDF. the funds received from the HF invested in projects

through JESSICA Loans or Equity are considered outflows for the UDF. It is assumed that the

management fees can only be paid out of capital contributed to the UDF until 31 December 2015,

while, after that date, the fees have to be paid from the repayments from underlying projects9. Inflows

for the UDF are the repayment of the invested funds by the projects (principal and interest for the

loans and dividends and capital gains for equity investment). From the perspective of the financial

Institution, outflows are its own funds used for co financing projects via commercial loans and inflows

are the repayment of commercial loans by the projects (principal and interests) and the cash flow from

management fees received. Management fees are used for the calculation of the Financial Institution’s

IRR.

Main performance results are reported in the following table.

UDF: main performance indicators10

The Managing Authority perspective

The structure of the initiative proposed allows the Managing Authority to fully recover the funds

invested 19 years after the establishment of the HF. However, it may decide to launch the second

round of investments (first revolving cycle) earlier with a lower amount of funds. Our simulation

assumes that the HF will be phased-out when all projects have repaid the amount due to the UDF

(after 23 years from the establishment of the HF). Revolving ratio11

after 23 years is 116%.

9 According to the provisions of Regulation (EC) 1828/06.10 Due to the peculiar current European financial situation inflation rate over the lapse of time of the analysis was considered to

be unpredictable. Thus no inflation rate was applied.11 The revolving ratio is the ratio between the aggregated cash flow of the Holding Fund decreased by the management fee and

the initial capital contributed by the Managing Authority to the HF.

IRR UDF (24 years) 3,0%

Payback UDF (years) 17

IRR Financial Institution (24 years) 4,4%

Pay Back Financial Institution (years) 16

JESSICA funds managed 83.625

Funds invested in projects 66.029

Management Fees over 24 yeas (thousands EUR) 7.314

UDF/Financial

Institution


PwC 15

Managing Authority: main performance indicators12

Conclusions: JESSICA added value

The introduction of the JESSICA instruments will allow the Managing Authority to benefit from the

revolving nature of the initiative, reaping the benefit of a tool that regenerates resources dedicated to

urban development independent of other public funds that may become available under the next

programming period.

Furthermore, the incentive to co-financing by the UDF Financial Institutions allows almost doubling the

UDF funds available for investing in the urban regeneration initiatives included in the simulated

portfolio to over EUR 143 million (EUR 77,2 million JESSICA instruments + EUR 66 million in co-

financing), to cover about the 50% of the overall cost of the simulated project portfolio of

approximately EUR 287 million.

Last, but not least, the introduction of JESSICA instruments increases the financial profitability of

projects, thus making them more attractive for private investors and reducing the recourse to public

free grants for the realization of urban projects.

12 Management fees from MA: 2010-2015, 1,5% on invested capital (EUR 100 million) each year; from 2016 onward, 0,5% on

invested capital each year. Management fees to UDF: 2010-2015, 1,5% of yearly managed funds (paid from HF funds); 0,2%

each year of total managed funds (paid from projects’ return).

Nominal vaule of the contribution to HF (thousands

EUR)100.000

Management fees paid to HF (thousands EUR) 16.375

Management fees paid to UDF (thousands EUR) 4.534

Funds invested in Projects (thousands EUR) 77.222

Unused Funds (thousands EUR) 1.869

30 % revolving (years) 4

50% revolving (years) 7



Global Revolving ratio (24 years) 116%

Managing Authority


PwC 16

The aim of the study is to identify challenges and opportunities associated to the practical

implementation of JESSICA in the Campania Region, suggesting recommendations for its

implementation and for further steps towards introducing adequate financial engineering mechanisms.

In particular, the study:

Assesses the adoption of JESSICA funds on funding revenue-generating projects and/or plan

components included in the initiatives already undertaken within the Campania Region, giving

priority to those established in the framework of 2007-2013 ERDF Operational Programme

(ERDF OP), Operational Priority 6.1 ( “PIU Europa” and “Altre Città”).

Analyses the applicability and implementation of JESSICA to other initiatives in place under

European (e.g. European Social Fund), national (e.g. Implementation Program of FAS,

Programma Energia) and regional programs (sustainable construction and affordable housing).

Analyses the possible integration of JESSICA with other European policies aimed, for instance,

to enhance public security or to improve quality of life in the Convergence Regions (i.e.

European Social Fund objectives) like Campania.

Identifies the structure of JESSICA operations that best fits with the constraints of the

JESSICA financial instruments and the objectives and expectations of the Managing Authority

(including the model of the operation and the roles and responsibilities of the parties- EIB,

Managing Authority and the officer in charge of the Operational Objective 6.1. (“Responsabile

per l’Obiettivo Operativo” o “ROO” 6.1) and the benefits for all parties involved).

Defines the associated Investment Strategy.

Identifies operating steps to be undertaken after the signature of the Funding Agreement.

Offers a quantitative simulation of the operation of the JESSICA instruments.

Due to the strong synergies between the JESSICA initiative and the initiatives already in place in

Campania Region identified in the first phase of analysis and the strong commitment of the ROO

(promoter of the introduction of JESSICA financial instruments in Campania) to quickly proceed in light

of the advanced implementation stage of projects eligible for JESSICA, all analyses have been carried

out in view of supporting the most efficient and effective start-up of the initiative.

Aim of this document is describing the activities carried out in the context of the assignment and

summarising the related results.

This report includes:

the description of the activities carried out under the assignment;

the description of main characteristics of the implementation of JESSICA instruments in

Campania Region;

assumptions and results of the quantitative simulation of the initiative.

Deliverable produced within the study, detailed description of methodologies adopted for the analyses

and related results are reported in the following annexes:

Annex 1 - Identification and analysis of pilot projects;

1 Contents of the Report


PwC 17

Annex 2 - Structure of JESSICA instruments in Campania Region;

Annex 3 - Investment Strategy and Planning;

Annex 4 - Application form Altre Città:

Annex 5 - Results of specific analyses;

Annex 6 - Presentations;

Annex 7 - Description (in detail) of the activities carried out.


PwC 18

2.1 Introduction

The study was structured in two phases:


financial instruments in the context of the Campania Region, evaluating the applicability of

JESSICA to the initiatives in place within the ERDF OP for regenerating urban areas within the

Region, drafting the administrative path for the implementation of JESSICA. Output of this

phase is the Interim Report;

A support to start-up phase, in which, starting from results of the preliminary phase, we

defined the financial, organizational and legal structure of JESSICA instruments in Campania

Region, identified the investment strategy and carried out on-demand analyses to clarify

outstanding legal issues and topics related to the use of structural funds. At this stage we

simulated the initiative from a quantitative point of view, through the assessment of pilot

projects, and supported the Managing Authority in communicating benefits of JESSICA to the

interested parties (mainly municipalities and municipalities associations). Overall output of this

phase is the Final Report. However, several intermediate outputs were produced.

Both phases included activities related to the three main fields: structural funds, financial and legal and

involved the delivery of one or more documents13

. The following figures summarise activities and

related outputs produced.

13 The details of all activities performed are described in Annex 7.

2 Description of the activities carried out


PwC 19

Figure 1 - Preliminary evaluation phase: activities and outputs

Identification of objectives andpriorities of ERDF OP related tourban regeneration

Drawing of the context forJESSICA implementation (partiesinvolved, expectations, priorities)

Assessment of applicability ofJESSICA to the initiatives inplace

Screening of projects

Preliminary proposal for theadministrative process to befollowed for including “AltreCittà” initiative into JESSICAoperation

Structural Funds Legal Financial

InceptionReportOutput Task and activities

carried out in this area


PwC 20

Figure 2 Support to start-up phase: activities and outputs

We carried out activities in close cooperation with the JESSICA Task Force. Analyses are based on

information provided by the ROO and its staff.

Identification of financial,organisational and legalstructure of JESSICAinstruments in Campania Region

Definition of the InvestmentStrategy

Support in the identification andimplementation of administrativeprocess for the application ofJESSICA to “Altre Città” initiative

Identification of pilot projectsand quantitative simulation ofJESSICA operation

Support related to specificmatters (finalisation of theFunding Agreement, analyses ofspecific topics, etc..)

Stakeholders consultation


Output

Structure of JESSICAinstruments in Campania

Region -Annex 2

Investment Strategy andPlanning -Annex 3

Identification of PilotProjects -Annex 1

Results of analyses -Annex 5

Presentations -Annex 6

Application Form AltreCittà (Annex to the

Expression of Interests)

Annex 4

Task and activities



PwC 21

3.1 The Regional Context

3.1.1 Regional priorities for urban planning

The Regional urban renewal and regeneration market context cannot be considered as an

homogenous market place. The widespread presence of “difficult urban areas” from a social and

economic standpoint, is among the main challenges for the Campania Region (“Region” or

“Campania”).

Well-targeted investments in cities can have a substantial impact on the process of convergence and

address severe issues of deprivation and physical deterioration in the urban context.

Regional development objectives in line with the urban agenda are addressed in coordination with

several local policy processes. The local public institutions are carrying out several initiatives to

confront the situation. These might be summarized as follows:

general actions of economic-territorial planning and programming (regional planning), and,

more specifically, urban planning;

specific actions aimed at solving individual critical situations, by using ad-hoc economic and

financial resources and administrative instruments.

In the 2007-2013 planning period, the Campania Region recognized cities, in particular medium-sized

ones, as key actors in promoting territorial development. According to this assumption the Region

aims at enhancing local development through a multi-focused approach based on cities.

Urban renewal and regeneration can reduce territorial disparities and strengthen competitiveness and

quality of life in the whole regional territory.

In the previous planning period (2000-2006), the city of Naples was the main focus of support from the

Operational Programme. Specific needs of territories not directly connected to the main infrastructure

links of the Region were not specifically addressed.

The main issues to be taken into account for the 2007-2013 planning period can be summarized as

follows:

focus on environmental sustainability through the promotion of quality in local productive

systems;

enhancement of the infrastructure network (in terms of networks, junctions, logistics and

multimodality) and their connections to the main transport Axes (for instance to the Pan-

European Corridors).

Furthermore, according to the main provisions of the “Regional Strategic Document”14

and the

“National Strategic Reference Framework” (NSRF), the urban strategy adopted by the Campania

Region identifies the following categories of intervention:

development and enhancement of the regional network of medium-sized cities (cities with

more than 50,000 inhabitants, excluding Naples) in order to reduce urban decline and to

14 Deliberazione della Giunta Regionale (Regional Committee Deliberation) n. 1042, 01/08/2006.

3 Implementing JESSICA in the Campania Region


PwC 22

promote territorial competitiveness. Environmental and social issues of these territories should

be taken strongly into account;

combining the concept of multi-focused development with the relevant features of the urban

area of Naples. Infrastructures, local transport assets, services and human capital of Naples

should be driving forces for the whole network of medium-sized cities;

promotion and development of connected urban systems among smaller cities that are able to

combine their development strategies (FAS resources will be allocated to this priority );

enhancement in social and health services in order to promote the mainstreaming of social

policies through the instrument of “Piani Sociali di Zona,” according to the general strategy for

urban development.

3.1.2 Planning instruments in place

Regional and Territorial Plan

The Regional Territorial Plan (“PTR”), approved in 2008, is an instrument set up in order to address

and promote integrated actions with a territorial perspective.

The Plan identifies environmental, historical and cultural resources, defines local development

strategies and sets up guidelines for territorial planning in Campania.

The Plan aims at promoting a territorial balanced development through a coherent territorial

management (involving different decision-making levels). The document involves territorial issues as

well as social and economic elements.

Guidelines for social housing and renewal of urban territories

On March 6th, 2009, the Campania Region approved the “Guidelines and operative procedures for

social housing and urban renewal of urban territories affected by deprivation and physical deterioration”

in order to define a new territorial strategy addressing the following issues:

Housing;

Urban renewal and regeneration;

Urban mobility;

Social needs;

Local development.

The guidelines have been carried out coherently with the main contents of the PTR that includes

strategic provisions on social housing.

Campania pays particular attention to social housing issues in order to promote a balanced distribution

of population in its territory.

Interventions on housing policy are designed to meet social needs of vulnerable groups (young and

senior people, immigrants, singles, etc.) and should be implemented focusing on re-allocating existing

construction volumes instead of allowing additional new construction volumes.


PwC 23

3.1.3 Instruments in place for the implementation and financing of urban regeneration

initiatives

2007-2013 ERDF Operational Programme

The European Regional Development Fund Operational Programme 2007-2013 (ERDF OP) for the

Campania Region was approved by the European Commission (EC) on 11 September 2007. This OP

comes under the Convergence objective and has a total budget of EUR 6,9 billion. The financing

provided by the European Union (EU) under the European Regional Development Fund (ERDF)

amounts to about EUR 3,4 billion, representing about 11,8% of Community aid to Italy as part of the

cohesion policy for 2007-2013.15

The main Priority Axes (“Axes”) of the ERDF OP can be summarised as follows:

1. Environmental sustainability, cultural and heritage attractiveness;

2. Competitiveness of Regional productive system;

3. Energy;

4. Accessibility and transport;

5. Information Society;

6. Sustainable Urban development;

7. Technical Assistance and Cooperation.

Axis 6 “Sustainable Urban Development”, as drafted in the ERDF OP, integrated the evolution of the

EU development policy and the conceptual framework of the NSRF, strengthening the urban

dimension. This Axis foresees expenditures of approximately EUR 1,5 billion (out of which EUR 752,5

million are national co-financing).

The aim of this Axis is to improve inhabitants' living conditions by incorporating actions for urban

development in actions to promote social inclusion and wellbeing. The approach is coherent with the

integrated programming approach foreseen by the Commission, and this means the coordination with

other funds and instruments of urban planning interventions.

The urban renewal and regeneration objective will be implemented based on the multipurpose

development of cities in the whole regional territory.

Campania was the first of the Convergence Regions to contemplate the possibility of incorporating

JESSICA instruments in the ERDF OP with the priority of employing JESSICA funds on funding

revenue-generating projects and/or plan components included of the priority Axis 6.

Axis 6 is divided into the Operational Objectives reported in the following table.

15 Source: European Commission.


PwC 24

Table 1 - ERDF OP Axis 6: Operational Objectives

OperationalObjective

PurposeAmount allocated by

ERDF OP (EUR)Managed by

Category ofexpenses

OperationalObjective 6.1-Medium- SizedCities

Realisation of integratedurban developmentprojects aimed atimproving urban servicesand at ensuring social andeconomic sustainabledevelopment.

775.000.00016

ACG 16- Managementof territorial planningand protection ofcultural heritage,landscape andenvironment(Responsible forOperational Objective6.1. -ROO) and AGC 1-President of theRegional Committee.

6117

OperationalObjective 6.2.-Naples andmetropolitan Area

Realisation of IntegratedUrban Development planswith the aim of reducingsocial and environmentaldecay of the Area thusstimulatingcompetitiveness.

280.000.000ACG 1- President of theRegional Committee.

61

OperationalObjective 6.3.-Social Responsibilityof Cities

Developing socialinfrastructures of cities soto contribute to theimprovement ofaccessibility to andintegration of territorialservices for citizens.

450.000.000

ACG 17- Education andTraining and AGC 18-Social assistance andactivities, leisure andentertainment.

-

The ERDF OP allocated EUR 775 million in support of urban regeneration and quality of life projects in

medium-sized cities under Operational Objective 6.1. The Campania Region has undertaken two

initiatives for the implementation of Operational Objective 6.1:

the “PIU Europa” initiative, aimed at urban regeneration in 19 medium-sized cities, identified

with DGR18

no. 282/2008;

the “Altre Città” initiative, aimed at urban regeneration in 21 medium-sized cities (not included

in the 19 from “PIU Europa”), identified with DGR no. 1026/2009.

Projects that can be financed through the two above mentioned initiatives will have the following

general objectives:



renewal, regeneration and re-use of under-used or unused urban assets to create urban parks,

aggregation of shops in particular city areas to establish outdoor retail centres, handicraft labs,

expo areas, and social aggregation areas;

improvement of local mobility systems;

16 Out of which EUR 600 million have been allocated to the PIU Europa initiative, EUR 100 million to the Altre Città initiative, and

EUR 75 million have been devoted to interventions in Naples city area.17 Integrated projects aimed at urban and rural regeneration.

Potential beneficiaries may be: Campania Region, municipalities and other public entities, universities, Port Authorities, PPPs,

enterprises, etc.18 Deliberazione della Giunta Regionale (Regional Committee Deliberation).


PwC 25

safety and public security.

Credit and Guarantee Revolving Fund for the implementation of multi-annual programmes of

social housing19

The Credit and Guarantee Revolving Fund for the implementation of multi-annual programmes of

social housing has been set up by Campania Region in 2008.

This instrument aims at supporting social housing providing both guarantees and/or interest subsidies

for loan applicants. The revolving fund participates in the provisions managed by credit institutions in

order to free grant loans related to the implementation of social housing programmes. Promoters

allowed to implement these programmes are selected by the Region

The instrument may be complementary to the JESSICA initiative by bringing in additional funds for

projects that will pay particular attention to the integration between renovation/recovery of existing

buildings and new construction, as well as support to assisted and subsidised housing, including new

types of social housing, self-recovery and self-construction.

The “Piano Casa”

On 28 May 2009, Campania region approved the guidelines for a housing plan (“Piano Casa”) in order

to support the housing sector.

The main issues addressed by the Piano Casa can be summarized as follows:

Urban renewal and regeneration;

Focus on urban planning best practice, including recovery of materials, with incentives for

energy saving, new technology, etc.;

The possibilities for intervention concern;

Private housing renewal (small owners);

Renewal of IACP buildings - i.e. a specific type of social housing units in Italy - in urban

territories affected by deprivation and physical deterioration;

Construction of new buildings in lieu of existing abandoned properties;

Building interventions are allowed in territories affected by physical deterioration without

increasing existing allowed construction volumes in order to allow new building developments.

Concessionaires must allocate at least the 20% of their works for social housing.

A preliminary feasibility analysis showed that JESSICA instruments may be used, through a dedicated

UDF, for implementation of the Piano Casa in the region. Such result shall be confirmed by a thorough

assessment that can be undertaken once more detailed instructions on the implementation of Piano

Casa are issued at national level.

3.1.4 Other domestic and European programs and initiatives

Fondo Aree Sottoutilizzate (FAS)

FAS is an instrument set up in 2002 in order to provide national funding for development policiesaddressed to less developed (“under-used”) areas.

19 Legge Regionale n. 1 del 30/01/2008 (Campania Regional Law n.1 of 30/01/2008)


PwC 26

In 2008, the Interdepartmental Committee for Economic Planning (“CIPE”) - updated the FASallocation for 2007-2013, following the Structural Funds planning period.

Furthermore, CIPE specified the FAS funds allocated to regional Operating Programmes 2007-2013,

by resolution no.1/2009.

Against this background, Campania received an allocation of EUR 3.896,4 million in order to

implement regional and interregional programs in 2007-2013.20

FAS resources may provide financing

for urban regeneration under a different operative and procedural framework, according to the main

contents of the Regional Strategic Document and the NSRF.

Priority 8 “Competitiveness and attractiveness of cities and urban systems” of the Regional

Implementation Program FAS 2007-2013 promotes interventions also in smaller cities in the whole

regional territory. Two relevant categories of actions addressing urban development are presented as

follows:

8.1.2 “Development of sports facilities and redevelopment of existing buildings to promote

sport activities (about EUR 27 million allocated), related to the operative objective 8.1

“Development of the polycentric system of cities and enhancement of quality of life” (about

EUR 227 million allocated);

8.2.5 “Public housing” (about EUR 70 million allocated), related to the operative objective 8.2

“Promotion of Competitiveness and attractiveness exploiting territorial advantages, supporting

development potentials and enhancing quality of life” (about EUR 955 million allocated).

FAS may be allocated by means of free grant to projects included in the JESSICA initiative so toincrease their attractiveness for private investors. Once the Campania Regional Implementation planof FAS is approved, FAS may also be used to integrate available ERDF resources the framework ofthe implementation of JESSICA initiative in the region21.

European Social Fund (ESF)

Italy is taking a long-term approach to employment and growth, with new ESF-funded measures andpartnerships aimed at making its workers more flexible and its firms more competitive.

ESF funding is being channelled into five priority areas: Adaptability, Employability, Social inclusion,

Human capital, and Transnational/regional projects. Convergence regions are benefiting from extra

support under a separate priority named Institutional Capacity.

Campania received EUR 559 million for 2007-2013. ESF funds can be combined with ERDF

resources, in order to develop an integrated approach aimed at supporting social inclusion and

improving quality of life in the Region.

Specifically, the ESF may promote competitiveness and attractiveness of cities and urban systems by

promoting social and work integration in deprived urban areas, to meet the social needs of vulnerable

population (young and senior citizens, immigrants, singles, etc.), and improving the access to the

public services provided by the Region.

ESF may be to be complementary to the JESSICA initiative by bringing in additional funds for projects.

20 Source: Resolution n. 6/2009.21 See Annex 5 for detailed assessment


PwC 27

3.2 Analysis of the initiatives in place under the Operational Objective 6.1 of ERDF

OP

The analysis described in previous paragraphs showed that several financial instruments and

initiatives in place can be in some way connected with the development of urban regeneration projects

in the Campania region. The adoption of JESSICA financial instruments to urban regeneration projects

seem to be complementary to almost all of them. However, immediate applicability of JESSICA seems

to be possible only to the initiatives in place under the Operational Objective 6.1 of ERDF OP. Thus, a

detailed compliance assessment between such initiatives and JESSICA instruments has been

undertaken and described in this chapter.

3.2.1 “PIU Europa” initiative

Description of the initiative

According to the EC Regulation 1080/2006 and the European Commission’s Thematic Strategy on

Urban Environment, the Region launched the process for Integrated Urban Plans (PIU Europa) on

February 15th, 2008.

The PIUs represent integrated interventions that aim at enhancing competitiveness and attractiveness

of urban territories in Campania, taking strongly into consideration the guidelines for territorial planning

specified in the PTR.

PIUs are the operative instrument identified by the Region in order to implement its urban sustainable

strategy.

The PIU Europa Initiative supports the creation of sustainable urban regeneration interventions

included in the PIUs of 19 medium-sized cities. The ERDF OP foresees about EUR 650 million of

public funds, allocated among those cities. The following table summarises available resources for the

initiative22

.

Table 2 - Summary of available financial resources

Available financial resources Amount (EUR)

ERDF OP- Operation Objective 6.1 Medium- Sized Cities 600.000.000

public funds devoted to quality prize -6.000.000

Initial ERDF OP funds to be assigned to Cities =594.000.00023

10% of co-funding from Cities +59.400.000

Total initial public funds to be assigned to Cities =653.400.000

Through DGR no. 282/2008, the Region has:

identified the 19 cities object of intervention based on the demographic dimension, and the

levels of residential and socio-economic deprivation;

22The ERDF OP allocated EUR 775 million in support of urban regeneration and quality of life projects in medium-sized cities

under Operational Objective 6.1.: EUR 600 million have been allocated to Integrated Urban Plans of 19 medium-sized cities

identified with DGR n. 282/2008, EUR 100 million for financing the interventions of the 21 medium-sized cities under the Altre

Città initiative and EUR 75 million have been devoted to interventions in Naples city area.23 Of which EUR 50 million devoted to urban security improvement interventions


PwC 28

defined criteria to assign the resources of Operational Objective 6.1 to the cities;

approved the general scheme for the agreement between the cities and the region (Accordo di

Programma) providing the regulatory framework to implement the planning process for PIU

Europa.

Figure 3 - 19 medium sized cities24 implementing PIU Europa initiative

The initiative is based on an approach integrating different types of projects within the broader scope

of a comprehensive urban regeneration programme.

The approach adopted combines (directly or indirectly) different types of projects in a well coordinated

structure and can combine several funding sources (ESF, FAS, EAFRD25

coherent with their specific

eligibility expenses rules), together with the financial allocations already foreseen in Axis 6

“Sustainable Urban Development”.

Hence, PIU Europa represents a coordinated collection of urban projects aimed at strengthening the

attractiveness and competitiveness of Campania cities under a sustainable socio-economic

revitalization perspective closely aligned with the guidelines set by the Regional Territorial Plan (PTR).

The PIUs are developed by the cities on the basis of a continuous dialogue with the ROO. The

process initiates with the execution of a Memorandum of Understanding between the Region and the

medium sized city, as well as other possible key parties, followed by the setting up of a “control room”

(Cabina di Regia), overseeing the local partnership process and by the creation of a technical-

administrative working team.

24 Battipaglia, Acerra, Salerno, Giugliano in Campania, Torre del Greco, Pozzuoli, Casoria, Caserta, Castellamare di Stabia,

Afragola, Benevento, Marano di Napoli, Portici, Avellino, Ercolano, Cava de’Tirreni, Aversa, Scafati, Casalnuovo di Napoli.25 European Agricultural Fund for Rural Development.


PwC 29

Each medium sized city, through a participative planning process involving major stakeholders,

defines the PIU Europa Programme, which constitutes the operating framework - including the

identification and intermediate design of candidate projects - to give concrete application to the City

Strategy Development Guidelines (DOS)26

. The coherence with territorial priorities and guidelines is

checked by the ROO and the NVVIP27

, via ex ante and in itinere evaluations.

The documents submitted by the city authorities undergo a process of assessment and evaluation

consisting of three sequential and interlinked phases. Each phase has a specific content, and implies

a judgment on the quality and contents of the documents.

The ROO carries out the first two phases, relating respectively to the technical analysis of the

proposed interventions and the analysis of the regulatory, organisational and procedural aspects. A

third phase is performed by the NVVIP as part of the ex ante evaluation, in parallel to phases one and

two. The NVVIP analysis takes place at a comprehensive urban level and aims at evaluating the

Integrated Plan within a wider context encompassing the urban projects under PIU and DOS.

Such approach emphasizes the role and involvement of the regional administration in order to bring

about a successful outcome of the PIU process and facilitate a quick start of the initiatives, under on-

going monitoring and control by the ROO.

The process started in 2008. As of August 2010, 19 Memorandum of Understanding have been

executed and one received formal approval. 18 Control Rooms have been set up and one of them

took already office. Furthermore, the PIU Europa Programme of Salerno has been approved, 4 other

Programmes are under examination, 4 are under elaboration and 9 are going to be finalised.

Table 3 – Status of PIU Europa initiative (January 2010)

Medium-sized cityMemorandum of

Understanding

DPGR28 for the establishment

of the Control Room

Establishment of the

Control Room

Acerra 01/08/2008 n. 202, 29/09/2008 21/04/2009

Afragola 25/11/2008 n. 38, 13/02/2008 16/03/09

Avellino 01/08/2008 n. 203, 29/09/2008 26/01/2009

Aversa 27/04/09 n.a. 17/12/2009

Battipaglia 22/10/2008 n. 260, 04/12/2008 23/01/2009

Benevento 08/04/2008 n. 172 del 08/08/2008 24/11/2008

Casalnuovo 30/07/2009 n.a. Not established yet

Caserta 02/04/2008 n. 171, 08/08/2008 06/10/2009

26 City Strategy Development Guidelines (DOS - Documento di Orientamento Strategico) is a comprehensive document that

identifies priorities and sets general urban development guidelines. The contents of the document are coherent and aligned with

guidelines set by the PTR.27 Projects Evaluation and Verification Committee (Nucleo di Verifica e Valutazione Investimenti Pubblici)28 Decree of the Regional Committee’s chairman (Decreto del Presidente della Giunta Regionale).


PwC 30

Medium-sized cityMemorandum of

Understanding

DPGR28 for the establishment

of the Control Room

Establishment of the

Control Room

Casoria 10/02/2008 n. 55, 02/03/2009 01/04/09

Castellamare 25/02/2008 n. 170, 08/08/2008 18/09/2008

Cava 15/03/2008 n. 140, 15/07/2008 11/08/2008

Ercolano 08/07/2008 n. 169, 08/08/2008 15/12/2008

Giugliano 10/04/2008 n. 173, 08/08/2008 29/01/2009

Marano 21/05/09 n. 167 del 12/06/2009 25/11/2009

Portici 01/08/08 n. 204, 29/09/2008 26/02/09

Pozzuoli 21/05/09 n. 166 del 12/06/2009 17/11/2009

Salerno 23/06/2008 n. 168, 08/08/2008 04/12/2008

Scafati 01/08/2008 n. 209, 29/09/2008 27/01/2009

Torre del Greco 25/11/2008 n. 3, 12/01/2009 28/01/2009

As of August 2010, 14 cities have presented the list of projects included in the PIU Europa, for a total

of 166 interventions, however available data on projects are not homogeneous. Analysed information

on PIU Europa interventions include:

project maturity (feasibility study, preliminary project design, final design, executive detailed

design);

total investment cost;

sources of funding (objective 6.1 co-financing, local funding and/or other public funds, private

co-financing);

category of intervention;

project return (qualitative evaluation);

potential urban constraints (if any);

time for implementation;

main stakeholders involved in the implementation stage.

Figure 4 shows the weight of the investment costs of projects presented by each city on the total

estimated investment costs of PIU Europa interventions (EUR 804 million). Portici and Cava de’ Tirreni

show the highest percentages, respectively with the 28% and the 16% of the total interventions costs.


PwC 31

Figure 4 - Total cost of PIU Europa interventions by medium-sized city (%)

Figure 5 shows the financial coverage of PIU Europa interventions by category of funding. The 46% of

the total estimated cost of PIU Europa initiatives are covered by Campania ERDF OP 2007-2013,

operational objective 6.1 co-financing. The remaining 54% are financed through other public (mainly

local) funds (27%), and by private co-financing (27%).

Figure 5 - PIU’ Europa interventions by source of funding (%)

Private co-financing (Figure 6) is foreseen in Cava de’ Tirreni, Portici, Scafati and Casoria, showing

respectively the 69%, the 46%,the 43% and the 8% of private co-financing allocated to PIU Europa

interventions.

7%

11%

4%

5%

7%

6%

28%

4%

16%

4%4%

6%1. Salerno

2. Giugliano

3. Torre del greco

4. Casoria

5. Castellammare

6. Benevento

7. Portici

8. Ercolano

9. Cava de'Tirreni

10. Battipaglia

11. Acerra

12. Scafati

12

3

4

5

6

7

8

9

1011 12

46%

27%

27%

1. 6.1 co-financing 2. Private co-financing 3. Other public funds

3

1

2


PwC 32

Figure 6 - Categories of funding (%) for PIU Europa interventions by medium-sized city

The 166 PIU Europa projects, have been grouped in 6 main areas of intervention29

, based on Annex A

“Summary of Region Strategy Development guidelines”, Axis 6 – Region Campania ERDF OP 2007-

2013 – operational objective 6.1.

According to data analysed (Figure 7), the main areas of intervention are: Improvement of socio-

economic wellbeing in cities (44%) - for instance regeneration of deprived urban areas, recovering of

urban spaces, enhancement of public housing, etc. -; and Improvement of environmental conditions

(38%) - for instance interventions of urbanization, infrastructural actions aimed at enhancing

accessibility, etc.

29 Socio-economic wellbeing, Socio-economic regeneration, Integrated public transport and ICT, Environmental conditions,

Cultural renewal, and Management improvement.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

90%

46%

79%92%

62%

85%

10%

82%

21%

79%91%

48%

10%

54%

21%

38%

15%

43%

18%

11%

21%9%

9%

8%

46%

69%

43%

6.1 co-financing Other public funds Private co-financing


PwC 33

Figure 7 - PIU Europa interventions by main area of intervention (%)

Among the main areas of intervention, private co-financing is foreseen mainly on Integrated public

transport and ICT (38%), Improvement of environmental conditions (25%), and Improvement of socio-

economic wellbeing (25%) (Figure 8).

Figure 8 - Categories of funding (%) for PIU Europa interventions by main area of intervention

44%

38%

0%2%

15%0%

1. Socio-economic wellbeing 2. Environmental conditions

3. Socio-economic regeneration 4. Cultural renewal

5. Integrated public transport and ICT 6. Management improvement

5

1

2

4

6

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

49% 50%

94%

22%

26% 24%

100%

6%

39%

100%

25% 25%38%

6.1co-financing Other public funds Private co-financing


PwC 34

Identification of ”Jessicable” projects

As already mentioned the PIU Europa initiative was launched in 2008. At that time, the adoption of

JESSICA instruments for financing revenue generating projects included in the initiative, although

foreseen within the ERDF OP, was not explicitly incorporated in the project proposal procedures.

Hence, projects presented by cities in the framework of PIU Europa may not fulfil the requirements of

the JESSICA initiative (i.e. amount of the investment, status of implementation, involvement of private

partners, etc.). Thus, the possibility of applying JESSICA instruments to the PIU Europa initiative was

analysed by verifying the compatibility of the characteristics of projects presented by cities with the

requirements of the JESSICA initiative. Since all PIU Europa projects are included in Integrated Urban

Plans for Sustainable Development (PIU Europa plans), projects were screened against the following

criteria:

capability to generate revenues; and

eligibility of projects expenditures under Structural Funds.

Based on the above criteria, the following main categories of projects were identified:

Category A: projects to be funded with free grants from public (national, regional and/or local)

sources;

Category B: projects suitable for funding with free grant co-financing from ERDF and/or public

(national, regional and/or local) sources;

Category C: projects that are suitable for total funding with ERDF OP free grant co-financing;

Category D: projects to be funded with public (national, regional and/or local) funds / private

funds;

Category E: projects to be funded with private funds;

Category F: projects to be funded with public (national, regional and/or local) funds / private

funds / OP/ERDF free grant co-financing. ; and

Category J: projects potentially suitable for co-financing through JESSICA revolving use of

ERDF OP funds.

In order to facilitate the exercise, the “Jessicability map” reported in the following figure was used.


PwC 35

Figure 9 - “JessicaAbility map”

The 166 projects were placed in the “Jessicability map” as follows:

Capability of projects to generate revenues. Due to the limited and not heterogeneous

information available on projects, profitability was judged against the scale zero, low, medium,

high, were:

o Zero profitability is assigned to urban equipment and fittings, to projects aimed at

improving mobility and circulation, to the refurbishment of Educational Buildings and

to interventions aimed at improving public security;

o Low profitability is assigned to the refurbishment of squares and piazzas (due to the

possibility of foreseeing commercial activities, such as newspaper stands), of

historical buildings (when associated with the introduction of low revenues generating

activities, such as public art galleries or libraries), of historical city centres and to

intervention aimed at rationalising the public transport system;

o Medium profitability is assigned to the refurbishment of historical buildings (when

associated with the introduction of potentially profitable commercial activities, such as

cinemas or theatres), to leisure and sport centres, to the refurbishment of squares

associated with the construction of underground parking, and to the expansion of

ports.

o High profitability is assigned to interventions related to the development of

intermodality, to the construction of multifunctional centres devoted to commercial and

service activities and to the construction of SPA centres.

Eligibility of project expenses for Structural Funds. The parameter used was the amount

of ERDF contribution on the total amount of investment. Projects were assessed against the

scale zero (0%), low (> 0% <= 30%), medium (> 30% <= 70%), high (> 70%)

The analysis showed that 35 out of 166 projects would be Jessicable (projects distributed on the grey

area of the map in Figure 9 and 10-1). However, it was decided:

Null Low Medium High

Nu

llL

ow

Me

diu

mH

igh

Capability ofprojects to generaterevenues

Elig

ibilit

yo

fp

roje

cts

ex

pe

ns

es

for

str

uc

tura

lfu

nd

s

CategoryA

CategoryB

CategoryC

CategoryD

CategoryE

CategoryF

CategoryJ


PwC 36

(i) first, to exclude from the list the projects already designated for full ERDF free grant funding, in

order not to affect already established development strategies set by cities in agreement with

the Region, and

(ii) second, to include all projects with a potential profitability that foresee the involvement of

private investors30

.

At the end of the analysis, 1531

projects resulted to be Jessicable (Figure 10-2), with a total investment

cost of EUR 306 million, out of which 7 appear to be immediately Jessicable (belong to category J), 2

of them belong to category D and 6 belong to category E of the Jessicability map.

Figure 10 - PIU Europa interventions’ distribution in the “Jessicability map”

Furthermore, ad-hoc re-shaping and aggregation of other projects could enlarge the scope of

application of JESSICA instruments to a larger number of projects. As a matter of fact, the application

of JESSICA instruments to Jessicable projects would decrease the amount of ERDF OP free grant

funds needed to realize such projects and would allow moving these amount to finance revenue-

generating projects that currently have low or no ERDF OP funds coverage, the amount of potentially

eligible expenditures notwithstanding. The result would be a larger number of Jessicable projects to be

potentially financed (54 schemes rather than the 15 in the JESSICA core portfolio, for a total of about

EUR 474 million, as illustrated in Figure 11(1+2+3)).

30 In our exercise, eligibility of project expenses for ERDF financing was defined according with the amount of ERDF funds

allocated to the projects. However, since allocation of ERDF funds mainly follows guidelines at regional and city level, the

parameter used may underestimate the amount of eligible expenses. In this context, projects selected were considered to be

less strategic than others and were not assigned ERDF funds, notwithstanding eligibility of expenses.31 The sixteenth intervention on regeneration of commercial area in the historical city centre has been excluded since it was

attributed to social cohesion instead of urban regeneration.

Pe

rce

nta

ge

of

ex

pe

ns

es

elig

ible

for

ER

DF

fun

din

g

Profitability of projects


Nu

llL

ow

Me

diu

mH

igh

Pe

rce

nta

ge

of

ex

pe

ns

es

elig

ible

for

ER

DF

fun

din

g

47

64

9

1

18

3

8

6

6

2

1

Projects “Jessicabili” (1)


Projects selected according to identified criteria (2)


47

64

9

1

18

3

8

6

6

2

1

Nu

llL

ow

Me

diu

mH

igh

1 1


PwC 37

Figure 11 - Potential for JESSICA

The table below summarizes the main information available for the 15 selected interventions:


Projects “Jessicabili” post-reshaping (3)

Perc

en

tag

eo

fexp

en

ses

elig

ible

for

ER

DF

fun

din

g

47

64

9

1

18

3

8

6

6

2

1

Low

Mediu

mH

igh

Nu

ll



Perc

en

tag

eo

fexp

en

ses

elig

ible

for

ER

DF

fun

din

g

47

64

9

1

18

3

8

6

6

2

1

Potential for JESSICA (1+2+3)

Low

Mediu

mH

igh

Nu

ll


1 1


PwC 38

Table 4 - Selected PIU Europa interventions

IDMedium-sized

cityPiù Europa

Intervention Description Area

Category ofJessicability

mapTime to

completion

Total cost(million

EUR)

Financial coverage million EUR )

Profitabilityof projects

Design stageObjective 6.1

Otherpublic funds

Privatefunds

1 Casoria“Il polo del

mercato e dellefiere”

Area for SMEs events and exhibitions,in order to promote commercialrelations among national andinternational SMEs.

Enhancement ofwell-being

conditions incities

J 24-36 5,4 2,4 - 3,0 MediumFeasibility

study

2Cava

de'TirreniHotel 2 Torri

Urban-environmental regeneration of atouristic, disused, area to be convertedin urban area for social-health services.The project consists of the replacementof the existing touristic accommodationfacility with a rehabilitation centre fordisabled people.


conditions incities

J 36 4,0 2,0 - 2,0 MediumPreliminary

project

3Cava

de'TirreniParking Piazza

Amabile

Realization of an underground multi-level parking:

I level with 100 garagespaces;

II level with at least 40garage spaces and 140parking spaces; and

III level with at least 200parking spaces.

Furthermore, the project consists of therefurbishment of the public squareabove the parking area.

Enhancement ofenvironmental

conditionsD 36 22,0 - - 22,0 Medium

Feasibilitystudy

4Cava

de'Tirreni

“Officine diMauro” -

Cavamarket

Refurbishment and conversion of an exfactory (intended for “di Mauro”graphics) into public spaces forcommercial and tertiary activities.Specifically, will be delivered:

offices; advanced urban functions

(with a specific focus oncultural facilities as amultimedia library, internet,etc.);

parks and gardens; car-parks.


conditions incities

E 36 30,0 - - 30,0 HighExecutive

project


PwC 39

IDMedium-sized

cityPiù Europa



mapTime to

completion

Total cost(million

EUR)




Otherpublic funds

Privatefunds

5Cava

de'Tirreni

Multifunctionalcomplex S. Maria

del Rovo

Urban spaces combining industry andpublic interest: the intervention consistsof school facilities, health and socio-cultural services, parking areas, publicparks and gardens.Productive activities include publicconcerns (“esercizi di vicinato”),medium commercial distribution, tertiaryactivities, and a small business ofmanufacturing activities.


conditions incities

E 36 31,6 - - 31,6 HighExecutive

project

6 PorticiIntermodal

exchanger rail-sea of Granatello

The intervention aims at overcominggradients of railways and roadsexisting in the target areaAn underground multilevel parking willbe realized in area Granatello -Scientific centre (8 sections, 1000parking spaces).

Integrated publictransport and ICT

E 30 35,6 - 10,9 24,7 HighFeasibility

study

7 Portici

Intermodalexchanger rail-

sea vialeGianturco

Realization of a new areabetween street Gianturco andthe railway

Realization of anunderground parking next tothe FF.SS. rail station ofPiazza San Pasquale

Realization of about 300parking spaces (50% ofprivate spaces and 50% ofrotational public spaces) nextto the historical centre



study

8 Portici

Intermodalexchanger rail-

road viaCamaggio

The intervention is included in thecomplex project “Improvement offixtures owned by Ferrovie dello Stato”.Specifically, the intervention consists of2 underground parking, as follows:

area Camaggio - 3 levels,132 parking spaces

area Bagnara - 2 levels, 64parking spaces


E 30 8,8 - - 8,8 HighFeasibility

study

9 PorticiIntermodalexchanger

Circumvesuviana

Rail connection with the Circumvesianatracks



study


PwC 40

IDMedium-sized

cityPiù Europa



mapTime to

completion

Total cost(million

EUR)




Otherpublic funds

Privatefunds

10 PorticiPort basin “del

Granatello”

Widening of the port basin “delGranatello”, based on a central axisending on a dam outside the harbour.


D 30 65,7 - 21,5 44,3 MediumFeasibility

study

11 PorticiRefurbishment of

Piazza S. Ciro(A/B)

A) ERDF co-financing: refurbishment ofthe public square above the parkingarea and conversion into pedestrianprecincts of large sections.B) Private co-financing: realization of anunderground parking


conditionsJ 60 6,0 0,4 0,7 5,0 Medium

Preliminaryproject

12 PorticiRefurbishment of

Piazza delTribunale (A/B)

A) ERDF co-financing: refurbishment ofthe public area next to the Law courtdeveloping a roof garden.B) Private co-financing: realization of anunderground parking (2 levels)


conditionsJ

A) 42B) 48

2,3 1,0 - 1,3 MediumFeasibility

study

13 PorticiRedevelopment

of PiazzaLancellotti (A/B)

A) ERDF co-financing: redevelopmentof Piazza Lancellotti in order to improvethe façade of Villa Lancellotti and torefurbish the public housing in theintervention area.B) Private co-financing: realization of

an underground parking (2 levels) with200 parking spaces (50% of privatespaces and 50% of rotation spaces).


conditionsJ

1) 512) 45

4,0 1,3 - 2,8 MediumFeasibility

study

14 ScafatiEx-Manifattura

Tabacchi

Realisation of public services and of amultipurpose centre (public and privateoffices, shopping centre, hostel, publiclibrary).


conditions incities

J - 23,1 5,9 3,2 14,1 HighFeasibility

study

15 Scafati Educational Site

Realisation of a school, a gymnasium,an underground parking (190 parkingspaces) and refurbishment of the publicsquare located in the site.


conditions incities

J - 22,8 16,2 1,0 5,5 MediumFeasibility

study

TOTAL 305,8


pwc 41

3.2.2 “Altre Città” initiative

This initiative is devoted to the urban development of medium sized cities within the Campania Region

not included in the PIU Europa. Criteria similar to those already applied for the PIU Europa. DGR n.

1026\200932

have been used to identify the 21 medium sized cities included in the “Altre Città” initiative

and EUR 100 million from the ERDF OP were allocated for financing the interventions.33

The initiative is at the start-up phase. The administrative process started on April 2010, following the

signature of the Funding Agreement of the HF. By means of a public notice (Expression of Interest), cities

have been informed of the launch of the initiative and of the related procedure. Due to the high

compatibility of the initiative with the use of JESSICA instruments, the Region decided to start looking

directly to JESSICA instruments (Cfr paragraph 3.3). The administrative process for the presentation of

projects is divided in the following two phases:

During the first phase, each city expresses its interest in participating in the JESSICA initiative. To

this end, playing the role of promoter for both public and private projects, cities are required to

present Integrated Urban Plans and underlying projects to the ROO. The ROO verifies the

coherence of the different projects with the objectives of Operational Objective 6.1. and carries

out a preliminary assessment of the potential of projects to generate revenues, mainly by looking

at market analysis, when available as part of the project documentation. The required project

documentation consists of an application form, project lay-outs, business plan, if available, and

administrative documents. Documents can be presented to the ROO and its staff during two

lapses of time, each one lasting for two months. However, the process will not be a static one, but

entails a dialogue between the parties. Like in the case of PIU Europa, the ROO and its staff will

assist and steer cities and project developers towards the implementation of Integrated Plans and

projects aligned with the requirements of Operational Objective 6.1.

The second phase consists of the economic and financial assessment of projects performed by

the Urban Development Fund for the admission to JESSICA financing.

No projects under this initiative have been presented by the cities as of August 2010.

3.2.3 Conclusions

The analysis highlighted a high compatibility for the application of JESSICA instruments to revenue

generating projects of both initiatives. The following table reports the main results.

Table 5 - Applicability of JESSICA instruments to PIU Europa and Altre Città initiative


instruments

Main characteristics of the two initiatives Conclusions

Inclusion of projects in

Integrated Plans for

Sustainable urban

All projects developed and financed within

the Operational Objective 6.1. must be part

of a Integrated Urban Development Planning

The implementation of the PIU Europa Integrated

Urban Development plans is almost completed.

32 as detailed in section 3.2.1.33 The ERDF OP allocated EUR 775 million in support of urban regeneration and quality of life projects in medium-sized cities under

Operational Objective 6.1.: EUR 600 million have been allocated to Integrated Urban Plans of 19 medium-sized cities identified with

DGR n. 282/2008, EUR 100 million for financing the interventions of the 21 medium-sized cities under the Altre Città initiative and

EUR 75 million have been devoted to interventions in Naples city area.


pwc 42


instruments

Main characteristics of the two initiatives Conclusions

Development Process. The Altre Città initiative is at the start-up phase.

Following the results of the Preliminary Evaluation

phase of this study the administrative process for its

implementation has been structured and launched in

accordance with JESSICA requirements. In

particular, cities are required to develop Integrated

Urban Development Plans.

Revenue-generating

initiatives

The screening of the PIU Europa projects

proposed up to now highlighted 15 revenue-

generating projects out of 166 and a number

of other intervention that, if aggregated in

the appropriate way, could become revenue-

generating.

The Altre Città initiative is still in the start-up

phase. The ROO and its staff have

undertaken a process for stimulating cities to

produce and include in the Integrated Urban

Planning revenue-generating projects.

In their meetings with the cities included in the PIU

Europa process, the ROO and its staff are

stimulating cities to partially re-configure already

presented projects in order to make them revenue-

generating projects.

Generation of revenues by projects is one of the

eligibility criteria stated in the administrative process

launched for the implementation of “Altre Città”

initiative.

Part of expenses of projects

eligible for structural funds

Expenditures for intervention included in the

two initiatives must be eligible for ERDF

funding. However, in light of the strong

integration of the projects of the two

initiatives with other projects devoted to

urban regeneration, some components may

be only partially funded by ERDF or not at

all eligible to funding under ERDF.

Thus, eligibility of expenses for JESSICA

financing must be subject to a case by case

evaluation.

Expenditure for initiatives selected for financing

through JESSICA instruments will need to be, at

least, partially eligible for ERDF funding.

Non-eligible expenditure will be financed by other

investors (i.e. own funds of the Urban Development

Fund, private investors, national/regional/EU free

grants, institutional investors, etc.).

3.3 JESSICA Instruments in the Campania Region: architecture of the initiative

Following the results of the analysis and consultation with the ROO it was decided to design the

architecture for the adoption of JESSICA instruments for financing interventions under the “PIU Europa”

and “Altre Città” initiatives.

3.3.1 Expected benefits deriving from the adoption of JESSICA instruments

By introducing JESSICA instruments in the two initiatives, the Region intends to:

take advantage of the revolving nature of financial engineering instruments established through

JESSICA. The use of financial engineering instruments enables the Managing Authority to create

a tool that will “re-constitute” the financial resources dedicated to urban regeneration projects.

Once returned, these resources will represent an independent supply of funding, additional to

other potential resources made available in future programming periods;


pwc 43

promote the development and implementation of long-term self-sustaining urban investment.

Aware of the importance of developing and supporting urban projects achieving financial returns

along with purely socio-environmental benefits, the Managing Authority seeks to encourage Local

Authorities to plan investments assuring long-term economic, social and environmental benefits,

and simultaneously capable to be financially self-sustainable;

develop the capacity of public entities to plan and promote the use of participative design and

planning methodologies. The use of JESSICA financial engineering is dedicated specifically to

initiatives included in Integrated Plans for Sustainable Urban Development. As of today, the

Campania municipalities have undertaken a process of integrated urban planning based on a

continuous public-private dialogue, taking into account the private parties’ interest in being

awarded free grants and/or obtaining land use changes. In this context, the Managing Authority

aims at triggering a virtuous process stimulating Local Authorities to plan in a longer-term

perspective, and promoting systematic participation of stakeholders during the whole process,

from the identification of territorial priorities, to elaborating development guidelines, drafting urban

plans, and defining the technical, economic and financial characteristics of projects. The

introduction of innovative financial instruments supporting or substituting free grants is crucial to

move towards a system able to generate long-lasting benefits;

attract private financing into urban regeneration projects. By creating a financial instrument

dedicated to finance public-private urban regeneration projects, including environmentally

sustainable buildings and initiatives connected with social housing, and facilitating access to

credit at competitive rates, the Managing Authority intends to attract private capital into urban

regeneration. Selected initiatives can be supported jointly by UDF resources and public funds

from other sources. Along these lines, a “Credit and Guarantee Revolving Fund” is already in

operation to assist urban investment projects, specifically in favour of multi-annual programmes

of social housing34

;

bring into JESSICA financial engineering instruments additional resources from other

programmes, such as the Implementation Programme of FAS (Fondo Aree Sottoutilizzate), Piano

Casa, Renewable Energy, as well as social housing, infrastructure, etc. to support initiatives

complementary to those envisaged under Operational Objective 6.1.

3.3.2 Organisational legal and financial structure of the initiative

As a consequence of identified priorities and expected benefits, the opportunity to establish a Holding

Fund and the EIB as holding fund manager became evident. Taking into account the amount of funds

available for the operation the involvement of a single Urban Development Fund (UDF) investing in the

PIU Europa and “Altre Città” initiatives35

was considered more efficient than setting up two or more

UDFs36

.

34 As provided in Regional Law no.1 of 30/01/2008, BURC no. 5 bis of 4/02/2008, disciplined by DGR no. 231 of 06/02/2008 “Linee

Guida per la Programmazione in materia di Edilizia Residenziale Pubblica e fondi fitto”, as foreseen in Law 431/98.

35 As reported in the previous paragraphs of this study, the Jessica initiative is highly compatible with the PIU Europa and “Altre Città”

initiative.36 The managing Authority may decide to set up additional UDFs and change the target investments at a later stage of the initiative,

should additional funds become available.


pwc 44

In addition, in order to maintain the centralised control over the urban planning within the Region, the

ROO required to structure the JESSICA architecture so that compliance checks of projects with urban

planning criteria is made at Regional level before being financed by the UDF.

The figure below describes the overall architecture of the initiative.

Figure 12 - Overall architecture of the initiative

JESSICA Campania Holding Fund (HF)

The Campania Region has decided to contribute part of the ERDF OP funds of Operational Objective 6.1.

to the HF. The HF will manage the funds and will invest them in urban development interventions

included in the PIU Europa and Altre Città initiatives through an UDF. The HF is also responsible for the

treasury management of funds. A management fee, calculated as a percentage on the total amount of


HF Officer

UDF (FinancialInstitution)


Local HF Officer

Projects

Privateinvestors

Più Europainterventions

Altre Cittàinterventions

ROO

ERDF OP FundsObjective 6.1.

Repayments

Equity/Loan

Repayments

Grant

Grant/Landcontribution

Eq

uity/L

oan

+M

anag

em

ent

Fee

Rep

aym

ents

Eq

uity/L

oan

Div

idend

s/

Reim

burs

em

ent

+In

tere

sts

EIB

FundingAgreement

CampaniaRegion


Banks

CampaniaRegion

Cities

Loan

Repayments


pwc 45

ERDF OP funds contributed by the Region, is foreseen to compensate the HF manager for the provision

of services.

The signature of the “Funding Agreement” (FA) earmarks the set up of the HF, it governs the relationship

between the Campania Region’s MA and EIB and defines the Investment Strategy. Under the base

scenario, before the expiry of the FA, the Region could start recouping some of the initial amount

contributed, decreased by the management fees and increased by returns, if any. Also, the FA could be

terminated and the HF closed before the complete reimbursement of the funds.

Hereafter are briefly outlined the actors involved in the JESSICA implementation.

Investment Board and Holding Fund Manager

The Investment Board (HF IB) is the governing and controlling body of the HF. Operating activities are

carried out by an EIB representative acting as the Holding Fund Manager (HF Manager) , who will be

responsible for delivering the HF services foreseen under the Funding Agreement including:

The HF management under the control and guidance of the Investment Board,

The launch and management of the public tender process for the selection of the UDF,

The selection of the Local HF Officer;

Monitoring the implementation of the investments in urban projects by the UDF.

Local HF Officer

The Local HF Officer is the connection between the HF and the UDF. It is responsible of the “day to day”management of the HF under the supervision of the HF Officer. It is appointed by the EIB and isresponsible for:

Analysing the Investment Strategy of the HF and defining guidelines for the feasibility analysis of

interventions;

Preparing tender documents for the selection of the UDF;

Monitoring the implementation of projects;

Implementing and managing an investment reporting system.

Urban Development Fund (UDF)

The implementation of JESSICA instruments in the Campania Region foresees the establishment of a

single UDF.

The UDF is a financial institution that implements its own Investment Policy that has to be consistent with

the Investment Strategy of the HF, the ERDF OP objectives and the guidelines for projects under the two

initiatives PIU Europa and Altre città.. The UDF invests HF funds in urban development projects included

in the “PIU Europa” and “Altre Città” initiatives through loan or equity. Generally, the UDF is encouraged

to co-finance individual projects using its own funds or other third party funds.

The UDF is selected via a public tender issued by the HF.

The services carried out by the UDF manager are paid by management fees to be determined on the

basis of business plan submitted by the UDF during the public tender and further detailed at the level of

Operational Agreement. In accordance with EC regulations, the proposed scheme foresees that until

2015 fees can be paid out of ERDF OP funds contributed to HF/UDF and afterwards, the funds have to


pwc 46

be originated from repayment of underlying projects. Fees are calculated as a percentage on the total

amount of HF funds invested.

The relationship between the HF and the UDF is ruled by the Operational Agreement.

ROO

The Officer in charge of Operational Objective 6.1.plays the following strategic role:

Managing the administrative processes of PIU Europa and Altre Città initiatives;

Stimulating cities to develop financially sustainable projects in the framework of the PIU Europa

and Altre Città initiatives and to participate in the JESSICA initiative;

Defining the maximum amount of free grants - to be contributed by the Region or the City - that

can be assigned to projects, if necessary to make them revenue-generating;

Confirming the coherence of projects and plans with the priorities and principles of Operational

Objective 6.1.

In particular, the ROO will:

actively participate with the EIB in the elaboration of the proposals for modification of the

Investment Strategy and Planning to be presented for approval by the EIB to the Investment

Board, thus ensuring coherence with the principles of Operational Objective 6.1;

actively participate with the EIB in the elaboration of the detailed programme of activities to be

presented for approval to the Investment Board, in order to ensure coherence between the

“JESSICA Actions”37

and the activities performed by the Region within the scope of Operational

Objective 6.1.;

stimulate cities to elaborate projects aligned with the characteristics required by the investment

selection criteria, as follows :

o PIU Europa Initiative: the ROO will support the cities in including such projects within the

scope of PIU Europa;

o Altre Città Initiative: through public notice, the ROO has informed the cities about the

intention to implement JESSICA financial instrument and has notified the instructions to

gain access to such instrument. In particular, it will stimulate the 21 cities to present

projects in line with the investment selection criteria.

verify the coherence of the proposed projects with the Operational Objective 6.1 criteria;

promote integration between JESSICA instruments and other synergic actions (e.g. Credit and

Guarantee Revolving Fund, priority actions of Scheme 8 of the FAS Implementation Plan, Piano

Casa, ordinary funds, etc…) in order to pursue urban regeneration objectives.

Other Investors

Other investors may finance projects in the following forms:

Private investors: they may finance projects investment by equity contributions or other forms of

financing;

37 Jessica Actions: the tasks to be carried out by EIB in the framework of the implementation of the JESSICA Holding Fund


pwc 47

Campania Region: it may finance projects investment by assigning free grants deriving from

regional or national funds to the projects;

Cities: they may finance projects investment by assigning free grants to the specific projects or by

in kind contributions (typically land and/or building);

Banks/financial institutions other than the UDF itself may also finance projects.

3.4 Investment strategy

3.4.1 Introduction

The ERDF OP allocated EUR 775 million in support of urban regeneration and quality of life projects in

medium-sized cities under Operational Objective 6.1.

The Managing Authority wishes to employ part of these financial resources through the Financial

Engineering instruments supported by the JESSICA initiative. To this end, the Managing Authority has

decided to contribute an initial amount of EUR 100 million to the HF. The HF will invest in a UDF in order

to support the implementation of the initiatives (PIU Europa and Altre Città) put in place by the Campania

Region within the scope of Operational Objective 6.1.

If deemed appropriate, the Managing Authority will further contribute to the HF by bringing in additional

funds available under Operational Objective 6.1, or possibly from other sources, such as, FAS38

under the

urban sustainable development priority, and those supporting schemes launched under the Piano Casa.

The definition and implementation of projects will pay particular attention to the integration between

renovation/recovery of existing buildings and new construction, as well as support to assisted and

subsidised housing, including new types of social housing and self-construction.

3.4.2 Investment Strategy

Investments selection criteria

The objective of the HF is to manage the financial resources brought in by the Managing Authority by

investing them in a UDF with the objective of promoting urban sustainable development.

Subject to further due diligence of the relevant national rules, the UDF may be established under one of

the following forms:

Joint stock company;

PPP (Public Private Partnership);

Investments fund;

Bank or;

other existing financial institution (separate block of finance).

The HF may only make investments or commit for investment to support projects that:

are included in one of the two initiatives (PIU Europa and Altre Città). In line with the goals of the

two initiatives, the eligible operations will have the following general objectives:

38 Fondo per le Aree Sottoutilizzate (Fund for Underused Areas).


pwc 48

o environmental recovery, social and economic regeneration;

o renewal, regeneration and re-use of “waterfronts”;

o renewal, regeneration and re-use of under-used or unused urban assets to create urban

parks, aggregation of shops in particular city areas that form outdoor commercial centres,

artisan labs, expo areas, and social aggregation areas;

o improvement of local mobility systems;

o safety and security;


have received from the ROO a positive assessment on their compliance with the criteria specified

within Operational Objective 6.1.

Investment products

The resources contributed by HF can be invested by the UDF through:

equity instruments;

loans.

Other features of the investment products: investment limits.

Limits for the number of Operations: there are no maximum or minimum limits for the number of

Operations;

Geographic area: the resources of the HF can be invested in operations located in the 19

medium-sized cities identified by DRG no. 282/2008, and in the 21 medium-sized cities identified

by DRG no. 1026/2009;

Diversification: the resources of HF are not subject to any diversification limit. Percentage of

stakes, in case of equity investments: there shall be no maximum or minimum limits for the

holdings in operations.

3.5 Planning of the implementation phase

Figure 13 summarises the phases, and relative timeline, required for the implementation of JESSICA

financial instruments in the Campania Region.

The first step was the negotiation and finalization of the Funding Agreement for the establishment of the

JESSICA Campania HF. During this phase, the Investment Strategy, as well as the roles and

responsibilities of the key parties involved were defined. The agreement between the EIB and the

Campania Region was signed at the end of March 2010.

Following the finalization of the Agreement, the Managing Authority will contribute EUR 100 million from

the Operational Programme into the HF. The contribution should take place in one single payment.

The second step will be the establishment of the HF IB. To this end, members will be appointed by the

Region (ROO and Managing Authority), in agreement with the EIB, as defined in the FA and the first

meeting will be convened. During its first meeting, the IB will approve internal governance rules and the

code of conduct.


pwc 49

The third step will be the selection of the legal consultants to assist the HF during the tender process for

the selection of the UDF.

The fourth step concerns the selection of the UDF. During this phase, the legal consultants, in close

cooperation with the HF local officer and the HF officer and upon final approval of the HF IB will prepare

the appropriate documents for the public tender, launch the selection process, assist the HF IB in the

evaluation of proposals and prepare the operational agreement to be executed between the HF and the

UDF.

Following the finalization of the Operational Agreement, the investment phase will start. At this stage, the

UDF will evaluate projects and invest HF funds.

Figure 13 - Implementation phase timeline39

39 This diagram relies on hypothesis formulated by pwc on the base of the overall planning of activities foreseen by the Campania

Region for the implementation of Operational Objective 6.1 as of August 2010. Real implementation of the Jessica initiative may

follow a different time plan.

2010-2011

2012-2015Month1

Month2

Month3

Month4

Month5

Month6

Month7

Month8

Month9

Month..

OP funds transferinto HF

Appointment ofInvestment Board(IB) members

First meeting ofthe IB

Selection of thelegal consultants

Selection of theUDF

Investment Phase

Phase

Milestone

Legend


pwc 50

4.1 Introduction

The identification of the optimal structure for the implementation of JESSICA instruments in the Region is

supported by a quantitative analysis aimed at providing an overall evaluation of the economic and

financial feasibility of the operation and at describing potential benefits for all parties involved.

As described in Annex 7, the first step of the analysis was carried out at the project level. Firstly, a sample

of projects (pilot projects) for the simulation exercise was identified among the Jessicable ones included

in the “PIU Europa” initiative. The following criteria were used for projects selection:

Amount of the investment (> EUR 5 million);

Type of initiative (priority was given to those initiatives that could be replicated in other cities);

Status of the implementation of the initiative (priority was given to initiatives in an advanced

feasibility stage, since they offered enough information for the analysis, but could still be shaped

so to reach the highest results in terms of social benefits and profitability, if needed);

Involvement of private partners;

Interest expressed by the City who promoted the project in taking part to the JESSICA initiative.

Then, key performance indicators (IRR, Payback) were calculated for all pilot projects under four

scenarios: baseline (no use of JESSICA financial instruments), JESSICA Loan (UDF invests in the project

through JESSICA loan), JESSICA Equity (UDF invests in the project through JESSICA Equity), JESSICA

Equity and Loan (UDF invests in the project through JESSICA Equity and JESSICA Loan). Depending on

the results, the most suitable way to use JESSICA instruments was identified for each project.

The second step of the simulation was carried out at UDF and HF level. It involved:

the identification of the pilot projects mix that best suited the amount of funds to be invested and

expected financial results (project portfolio);

the identification of plausible HF duration scenarios, based on timing for contribution to revolve

back to Managing Authority;

the calculation of key performance indicators (IRR, Payback) for the various parties: the HF, the

UDF, the Financial Institution that manages the UDF, the Managing Authority.

All the analyses carried out are based on specific assumptions on:

Project level:

Investment: amount and project phases (based on project documentation and on unit

construction costs, applied at the moment by main Italian construction companies);

Financing: debt/equity ratio;

Management model (based on project documentation, where the information is available, or

proposed on the basis of management models applied to similar initiatives);

Revenues (based on benchmarking with similar activities);

Costs (based on benchmarking with similar activities);

4 Quantitative simulation of the initiative


pwc 51

Income Tax rate;

Loan: interest rate, duration and grace period (based on benchmarking with similar activities);

Depreciation.

UDF and HF level:

Amount of funds to be invested (based on main terms of the FA);

Management Fees to HF (based on main terms of the FA);

Management Fee to Financial Institution that manages the UDF (based on calculation of the effort

required for the evaluation of projects);

Distribution of dividends and reinvestment of available cash.

The following paragraphs report the main results of the project analyses and the detailed description of

the outcomes of the UDF and HF analyses.

The full description of results of analyses undertaken at project level is reported in Annex 1.

4.1.1 Analysis of Projects

Pilot Projects description and main assumptions of the analysis

Based on the criteria described above, three projects were selected as pilot projects for the exercise. The

following table reports main characteristics of pilot projects as well as key related assumptions.

As reported in the table, compared to the baseline scenarios, the JESSICA scenarios foresee more

efficient management models (i.e. PPP against concession to private investors). Indeed, while in the

baseline scenario the possibility to adopt any PPP models should be analysed on a case by case basis in

the framework of the stability pact40

, the expenditures incurred through recourse to JESSICA instruments

are not affected by the stability pact41

rules.

40According to Decree law 112/2008, converted by Law 133/2008, the stability pact imposes severe limitations to local authorities’

expenditures, including investments, based on their debt balance.41 As clarified by to the note issued by the “Ragioneria dello Stato” of the Italian Ministry of Finance on March 30th, 2010, article 77-

bis par. 7-quater of Decree law 112/2008, as introduced by article 4, par. 4-septies, lett. b) of Decree law 2/2010, converted by Law

42/2010, provides for the exclusion from the balance taken into account for the purposes of the stability pact of any sum originating,

directly or indirectly, from the EU, even when the expenditure takes place over several years, provided in this case that overall

expenditures do not exceed the amount of the relevant allocated resources. A further explanation of this is provided in Annex 5.


pwc 52

Table 6 - Description of Pilot Projects and main assumptions of the analyses

Project

descriptionMain characteristics Management model Economic assumptions Financial assumptions

Parking and

square in Portici:

realization of an

underground

parking (150

spaces) in Portici

and refurbishment

of the public

square above the

parking.

Total investment:

EUR 5,96 million

Underground parking:

Investment cost: EUR 5,46 million

Surface: 6.000 sqm,

n° of parking spaces: 150

n° of private places for sale: 50

Square:

Investment cost: EUR 0,5 million

Surface: 2.000 sqm,

Owner of the land: Municipality

Baseline scenario (without JESSICA)

Construction of the parking

refurbishment of the square and 20 years

management of the infrastructure

assigned to a private entity against the

payment of a yearly concession fee. The

private entity is chosen by the

Municipality through a public tender. The

cost for the square is paid by the

Municipality. The square is managed by

the Municipality.

At the end of the concession agreement,

the infrastructure is returned to

Municipality against the assignment of

free grants to the project during the

investment phase.

Scenarios with JESSICA

Construction and 20 years management

of the infrastructure assigned to a PPP

(Private entity/Municipality). The Private

partner, chosen by the Municipality

through a public tender, participates to

the PPP equity through cash

contributions, while the Municipality

contributes the land. Both receive

dividends as remuneration of equity

contributions.

The Private Partner is in charge of the

Investment

Total investment: EUR 5,96 million

Phasing of the investment (% on total

investment costs): year 1: 20%; year 2: 60%,

year 3: 20%.

Revenues

Rent of parking spaces:

o n° of parking spaces: 150

o tariff: EUR 1 per hour per parking

space

o opening hours per day: 16

o occupancy rate: 75%

Sale of garage spaces:

o n° of garage spaces for sale: 50

o sale price: 1100 EUR/sqm

o sale period: during first and second

year of investment

Operating Costs

Personnel

o FTE: 5

o Average salary per year: EUR

30.000

Commercial Loan

Maturity: 20 years

Yearly Interest rate:

3,9243%

Grace period: 3 years

with interest payment

JESSICA Loan

Maturity: 20 years


0,9844%



Distribution of dividends:

100% from the first year following

the investment phase. Pari passu

rule applied.

Sources of financing

See Table 7

43 Real value corresponding to 6% nominal value at 2% inflation rate44 Real value corresponding to 3% nominal value at 2% inflation rate


pwc 53

Project


operation and maintenance of the

infrastructure.

At the end of the PPP agreement, the

infrastructure is returned to Municipality

with no residual value.

Overheads: 15% of yearly cost of

personnel

Facility Management: 30 EUR/sqm per

year (cleaning, security, ordinary and

extraordinary maintenance)

Working capital (investment phase)

Payables: 90 days

Depreciation: 20 years

Income tax rate: 33% on tax basis

Inflation rate: not applied42

“Educational

Building ” in

Scafati:

realisation of a

school, a

gymnasium, an

underground

parking (190

parking spaces)

and refurbishment

of the public

square located in

the site

Total investment:

EUR 22,76 million

School:

Investment costs: EUR

6,81 million

Surface: information not

available

Gymnasium:

Investment cost: EUR

3,57 million

Surface: 1.973 sqm




and JESSICA Loan scenario

The Municipality realises the whole

intervention with its own funds and sells

the underground parking and the land to

a private company selected through a

public tender.

JESSICA Equity and JESSICA Equity

and Loan Scenarios

The whole intervention is realised by a

PPP between the Municipality and the

UDF. UDF participates to the PPP equity

through cash contributions while the

Municipality contributes the land. The

Investment



investment costs): year 1: 20%; year 2:

60%, year 3: 20%.

Revenues

Sale of underground parking and land:

o Sale price for the Underground

parking: 20% margin on investment

costs

o Sale price for the land: 100

EUR/sqm

Commercial Loan

Maturity: 20 years


3,9246%



JESSICA Loan

Maturity: 20 years


0,9847%


42 Due to the peculiar current European financial situation inflation rate over the lapse of time of the analysis was considered to be unpredictable. Thus no inflation rate was applied.

As a result, profitability parameters are underestimated.46 Real value corresponding to 6% nominal value at 2% inflation rate47 Real value corresponding to 3% nominal value at 2% inflation rate


pwc 54

Project


5,52 million

Surface: 4.750 sqm,

n° of Parking spaces:

190

Square:


6,85 million

Surface: 5.000 sqm


PPP sells the underground parking and

the land to a private company selected

through a public tender. At the end of the

operation, the rest of the buildings are

recognised to the Municipality with no

residual value.

o Sale period: first year following

investment period

Operating Costs

Negligible

Working capital (investment phase)

Payables: 90 days







rule applied.


See Table 8

“Ex Manifattura

tabacchi” in

Scafati:

realisation of

public services

and of a

multipurpose

centre (public and

private offices,

shopping centre,

hostel, public

library)

Total investment:

EUR 23,106

million48

Lot 1: Public Services

Municipality Offices:

5.824 sqm

Baby Park: 303 sqm

Police Office: 1.124 sqm

Lot 2: Multipurpose Centre

Car parking: 3003 sqm

(157 parking spaces)

Food Hall: 1.258 sqm

divided in 5 units

Non food Commercial

Activities: 1.485 sqm


Construction of the whole intervention

and 20 years management of the

Multipurpose centre is assigned to a

private entity against the payment of a

yearly concession fee. The private entity

is chosen by the Municipality through a

public tender.

At the end of the concession agreement,

the infrastructure is returned to

Municipality with no residual value.

Investment:



investment costs): year 1: 20%; year 2:

50%, year 3: 20%; year 4: 10%.

Revenues:

Revenues from the underground

parking: 5% of construction costs per

year

Revenues from the private offices: 5%

of construction costs per year

Revenues from the hostel: 4% of

Commercial Loan

Maturity: 20 years


3,9250%



JESSICA Loan

Maturity: 20 years


0,9851%




As a result, profitability parameters are underestimated.48 Lot 1 and Lot 2 investment costs not specified in the documentation available50 Real value corresponding to 6% nominal value at 2% inflation rate51 Real value corresponding to 3% nominal value at 2% inflation rate


pwc 55

Project


divided in 9 units

Youth Hostel: 815 sqm,

80 beds

Fitness Centre: 975 sqm

Private Offices: 1.399

sqm

Library:2.109 sqm


Scenarios with JESSICA

Construction of the whole intervention

and 20 years management of the

Multipurpose centre is assigned to a PPP

between the Municipality (that contributes

the land) and a Private Partner chosen

through a public tender (that contributes

cash). The Private Partner is in charge of

the supervision of construction works

(against the receipt of a management fee

over construction costs) and of the

operating management of the

Multipurpose centre.

Both parties receive dividends as

remuneration of equity contributions.

Against the free grant assigned to the

project by the Municipality and the

Region, the public partner does not pay

any rent for the use of the public library.

In addition, at the end of the PPP

agreement, the infrastructure is returned

to Municipality with no residual value.

construction costs per year

Food Hall

o rent: 400 EUR/sqm per year


No-Food Commercial activities:



Fitness Centre:


Operating Costs:

Personnel

o FTE: 5

o Average salary per year: EUR

40.000

Overheads: 15% of yearly cost of

personnel

Facility Management: 30 EUR/sqm per

year (cleaning, security, ordinary and

extraordinary maintenance)




Management fee over construction paid to




rule applied.



See Table 9


As a result, profitability parameters are underestimated.


pwc 56

Project


private partner: 8% on construction costs


pwc 57

The following tables describe the financing structure foreseen for each of the projects.

Table 7 - Underground parking and square in Portici: Source of financing (%; thousands EUR)

JESSICA

Baseline Loan Equity Equity/ Loan

JESSICAInvolvement

Debt no Yes No Yes

Equity no No Yes Yes

Funding

Equity 4.960 3.472 3.472 1.563

Municipality* 0,0% 0,0% 0,0% 0,0%

Private Partner 100,0% 100,0% 50,0% 50,0%

JESSICA 0,0% 0,0% 50,0% 50,0%

Debt - 1.488 1.488 3.647

Commercial Loan 100,0% 60,0% 100,0% 50,0%

JESSICA 0,0% 40,0% 0,0% 50,0%

Free grant 1.000 1.000 1000 750

EU/Regional 350 350 350 350

Municipal 650 650 650 400

Total JESSICA - 595 1.736 2.605

* In all JESSICA cases the land constitutes contribution in kind by the Municipality. Equity percentages do not include contributions

in kind.

Table 8 - Educational Site in Scafati: Source of financing (%; thousands EUR)

JESSICA


JESSICAInvolvement

Debt no Yes No Yes


Funding

Equity 2.155 1.906 2.047 3.065

Municipality* 100,0% 100,0% 0,0% 0,0%

Private Partner 0,0% 0,0% 0,0% 0,0%

JESSICA 0,0% 0,0% 100,0% 100,0%

Debt 3.868 3.868 4.049 2.862

Commercial Loan 100,0% 0,0% 100,0% 20,0%

JESSICA 0,0% 100,0% 0,0% 80,0%

Free grant 17.237 17.237 16.979 16.979

EU/Regional 16.203 16.203 16.203 16.203

Municipal 1.034 1.034 776 776

Total JESSICA - 3.868 2.047 5.379

* In Equity and Equity and Loan JESSICA cases the land constitutes contribution in kind by the Municipality. Equity percentages do

not include contributions in kind.


pwc 58

Table 9 - “Ex Manifattura Tabacchi” in Scafati: Source of financing (%; thousands EUR)

JESSICA


JESSICAInvolvement

Debt no Yes No Yes


Funding

Equity 6.486 3.968 7.935 4.313

Municipality* 0,0% 0,0% 0,0% 0,0%

Private Partner 100,0% 100,0% 50,0% 90,0%

JESSICA 0,0% 0,0% 50,0% 10,0%

Debt 8.460 13.800 10.350 13.800

Commercial Loan 100,0% 40,0% 100,0% 50,0%

JESSICA 0,0% 60,0% 0,0% 50,0%

Free grant 9.000 5.850 5.580 5.850

EU/Regional 5.850 5.850 5.850 5.850

Municipal 3.150 - - -

Total JESSICA - 8.280 3.968 7.331

* In all JESSICA cases the land constitutes contribution in kind by the Municipality. Equity percentages do not include contributions

in kind.

Results of the analyses

Based on the assumptions reported above, key performance indicators were calculated for all

stakeholders. Financial indicators are shown in the following tables.

Underground parking and square in Portici

The economic and financial analysis of the baseline scenario shows that it would not be a viable solutionfor the development of the project. On the base of the assumptions described in the previous paragraphs,notwithstanding the assignment of free grants to the project:

the amount of cash available for financing is limited and does not allow the recourse to debt;

investment risks would entirely bear on the private investor;

against a large amount of equity investment required, profitability of the project for the private

investor is very low .

As a consequence, the project would not attract private investors.

The introduction of JESSICA instruments improves the attractiveness for private investors in all three

cases (by increasing the profitability and/or reducing the amount of equity investment by the private

investors). The Equity and Loan case has been chosen as the preferred one. Indeed, it shows the best

performance for all stakeholders, but JESSICA. However, JESSICA indicators can be considered

acceptable taking into account the overall principle of generating socio-economic returns along with pure

financial returns. Moreover, this scenario results to be attractive for private investors due to the high

profitability (16,3%) and the limited amount of private investment foreseen (EUR 782 thousands). In

addition, it foresees a reduction in the recourse to municipal funds, allowing a EUR 200 thousands saving

that can be used for financing under a free grant scheme other, less profitable, projects.

Table 10 summarises quantitative results of the analysis, while a qualitative description is provided in

Table 11.


pwc 59

Table 10 - Underground parking and square in Portici: Key performance indicators (IRR52:%; Payback: years53; Funds used:

thousands EUR)

Stakeholder Indicator BaselineJESSICA

Loan Equity Equity/ Loan

Private Partner

IRR 5,1% 3,6% 4,2% 16,3%

Payback 15 18 16 5

Funds used 4.960 3.472 1.736 782

JESSICA

IRR n.a 1,0% 4,2% 4,9%

Payback n.a 21 16 15

Funds used n.a 595 1.736 2.605

Municipality

IRR54 4,1% n.a. n.a. 4,7%

Payback 16 27. 24. 14

Funds used 650 650 650 400

Financial Institution

IRR n.a. 4,1% 4,1% 4,1%

Payback n.a. 16 16 16

Funds used 0 893 1.488 1.824

Public perspective (Structuralfunds/JESSICA/Municipality)

IRR55 0,1% n.a. 0,4% 1,4%

Payback 23. 29. 23 20

Funds used 1.000 1.595 2.736 3.755

ProjectIRR 5,6% 5,6% 5,6% 5,6%

Payback 15 15 15 15

Table 11- Underground parking and square in Portici: Conclusions of the analysis

Stakeholder BaselineJESSICA


PrivatePartner

Large amount of

private capital

required.

All project risks

(investment,

management and

market risks) borne

by the private

partner.

Profitability of the

investment over the

lapse of time

considered in the

analysis (IRR: 5,1%

over 23 years) not

high enough to

justify the high risky

Large amount of private

capital required.


investment over the

lapse of time considered

in the analysis lower

than that of the baseline

scenario.(IRR: 3,6%

over 23 years).

Longer time required for

the recovery of the

initial investment than in

the baseline scenario.

Lower amount of

private capital

required than in the

baseline scenario and

in the JESSICA Loan

scenario.


investment over the

lapse of time

considered in the

analysis is lower than

that of the baseline

scenario.(IRR: 4,2%

over 23 years)

Longer time required

for the recovery of the

initial investment than

Lower amount of private

capital required than in all

other scenarios.

High profitability of the

investment over the lapse

of time considered for the

analysis (IRR: 16,3% over

23 years).

Recovery of the investment

possible in a short period

of time (5 years).

Investment risk shared with

JESSICA instrument and

with the bank.

52 n.a.: parameter cannot be calculated in the considered timeframe (negative value)53 Number of years necessary to recover the sum invested. The parameter does not take into account time value of money54Outfolws: In kind contribution (land) and free grant; inflows: concession fee or dividends55 In kind contribution (land) is considered as outflow for the calculation of IRR


pwc 60



involvement of a

private partner in

the project.

in the baseline

scenario.

JESSICAJESSICA instrumentsnon adopted.

Due to the economics of the

project, recourse to debt is

possible for financing only a

small amount of investment.

Thus the adoption of

JESSICA instruments in

form of loan is very limited

( EUR 595 thousands)

Profitability of theinvestment over the lapseof time considered in theanalysis is acceptable(IRR: 4,2 % over 23years) taking into accountthe overall principle ofgenerating socio-economic returns alongwith pure financialreturns.

Profitability of the investmentover the lapse of timeconsidered in the analysis isacceptable (IRR: 4,9 % over23 years) taking into accountthe overall principle ofgenerating socio-economicreturns along with purefinancial returns.

Municipality

EUR 650 thousands

to be assigned (on

top of the ERDF

funds) by the

Municipality to the

project as free grant

in order to make it

become revenue-

generating.

The operation

allows the recovery

of the free grant

assigned in 16

years and a low

return on

investment at the

end of the

concession period

(EUR 75 thousands

in 23 years).

EUR 650 thousands to

be assigned (on top of

the ERDF funds) by the

Municipality to the

project as free grant in

order to make it become

revenue-generating.

The operation does not

allow the recovery of the

free grant assigned in

the lapse of time

considered for the

analysis (23 years).

Stability pact rules not

applicable.

EUR 650 thousands

to be assigned (on top

of the ERDF funds) by

the Municipality to the


order to make it

become revenue-

generating.

The operation does

not allow the recovery

of the free grant

assigned in the lapse

of time considered for

the analysis (23

years).


applicable.

Reduced amount of free

grant to be to be assigned

(on top of the ERDF funds)

by the Municipality to the


order to make it become

revenue-generating ( EUR

400 thousands against

EUR 650 thousands

needed in the other

scenarios)

The operation allows the

recovery of the free grant

assigned in 14 years and a

return on investment at the

end of the concession

period (EUR 107

thousands in 23 years).


applicable.

FinancialInstitution

Economics of theproject do not allow anyrecourse to debt.

Due to the economics of the

project only a limited

recourse to debt is possible.

Thus, the amount of bank

loan required is lower than

in the other scenarios.

The amount of bank loanis higher than in theBaseline scenario and inthe JESSICA loanscenario.

Economics of the project allowa higher recourse to debt thanin all the other scenarios, thusreducing investment risk ofprivate investors.

Publicperspective

The project foreseesthe use of ERDF andmunicipal funds, for atotal amount of EUR1.000 thousands. Thesum is not recovered inthe lapse of timeconsidered for theanalysis (23 years).

The project foresees the

use of public funds for a

total amount of EUR

1.595 thousands, out of

which almost EUR 595

thousands covered by

JESSICA instruments.

The sum is not

recovered in the lapse

The project foresees

the use of public

funds for a total

amount of EUR 2.736

thousands, out of

which almost EUR

1.736 thousands

covered by JESSICA

instruments.



total amount of EUR 3.755

thousands, out of which

almost EUR 2.605



The sum is recovered in 20

years. However, no return


pwc 61



of time considered for

the analysis (23 years).

No reduction of ERDF

+ Municipal funds

possible compared to

the baseline scenario.

The sum is recovered

in 23 years. However,

no return of

investment is

foreseen at the end of

the period of time

considered.

No reduction of

ERDF + Municipal

funds possible

compared to the

baseline scenario.

of investment is foreseen

at the end of the period of

time considered.

Under this scenario, a

lower amount of municipal

funds are needed

compared to the other

scenarios. Saved funds

may be used to finance

other projects.

Educational Site in Scafati

This project is characterised by a large part of the investment costs (around 76% of the total investment

costs) devoted to the realisation of infrastructures for social purposes (school and square) for which no

economic return is foreseen. For this reason, a high amount of free grants are assigned to the project

(regional and municipal free grants). The Municipality intends to recover part of the investment costs by

selling the underground parking realised below the square.

In the baseline scenario, the Municipality realises the project by its own, participating as an equity

investor. Indicators of the baseline scenario show that the Municipality will not recover the investment

(equity plus free grant) through the sale of its assets. In addition, the operation has to be analysed in the

framework of the stability pact.

All JESSICA scenarios benefit the Municipality. The JESSICA Loan scenario allows a decrease of equity

contributions from the Municipality, thanks to the lower interest rate applied by the commercial banks

within the JESSICA framework that the one usually applied. Thus, EUR 249 thousands can be saved by

the Municipality and used for other purposes. In addition, this scenario allows the recovery of the

investment made by the Municipality (equity and free grants). However, the feasibility of the operation

should be verified in the framework of the stability pact. Under JESSICA Equity and JESSICA

Equity/Loan scenarios the only equity investor is JESSICA since the low profitability of the operation

would not attract any private investor56

. In both scenarios the Municipality would save EUR 2.414

thousands compared to the baseline one and the operation would not be subject to the stability pact rules.

Saved funds may be used by Municipality to finance other projects. Performance parameters of the

JESSICA Equity and JESSICA Equity/Loan scenarios are very similar.

The JESSICA Equity scenario has been chosen as the preferred one since:

it ensures feasibility of the operation in the context of the stability pact while guarantying saving

of funds by the Municipality and

it entails a lower risk profile from the JESSICA perspective (lower amount of funds required)

compared to the other cases.

56 Profitability of the investment has been considered acceptable for JESSICA taking into account the overall principle of generating

socio-economic returns along with pure financial returns and the limited number of years required to recover the investment.


pwc 62

Table 12 summarises quantitative results of the analysis, while a qualitative description is provided inTable 13.

Table 12- Educational Site in Scafati: Key performance indicators (IRR57:%; Payback: years58; Funds used: thousands EUR)



JESSICA

IRR n.a 1,0% 3,9% 4,0%

Payback n.a 4 4 4

Funds used n.a 3.868 2.047 5.379

Municipality

IRR n.a. 0% - -

Payback n.a. 4 - -

Funds used 3.189 2.940 776 776

Financial Institution59

IRR 4,1% - 4,1% 4,1%

Payback 4 - 4 4

Funds used 3.868 - 4.049 578

Public perspective(Structural funds/JESSICA/Municipality

IRR n.a. n.a. n.a. n.a.

Payback60 n.a. n.a. n.a. n.a.

Funds used 19.392 23.011 19.026 22.358

ProjectIRR 0,5% 0,5% 0,5% 0,5%

Payback 4 4 4 4

Table 13- Educational Site in Scafati: Conclusions of the analysis



JESSICAJESSICAinstruments notadopted.

Profitability of the investment

is acceptable taking into

account:

the limited number of

years required to recover

the investment (4 years)

the overall principle of

generating socio-

economic returns along

with pure financial returns.



account:





generating socio-


with pure financial returns



account:





generating socio-


with pure financial

returns

Municipality

Sale of the

underground

parking and

land is not

enough to

Sale of the underground

parking and land is

enough to recover the

initial investment made by

the Municipality (EUR

No recourse to equity

contribution by the

Municipality results in

EUR 2.155 thousands of

Municipal funds savings.

No recourse to equity

contribution by the

Municipality results in

EUR 2.155 thousands of

Municipal funds savings.

57 n.a.: parameter can’t be calculated in the considered timeframe (negative value)58 Number of years necessary to recover the sum invested. The parameter does not take into account time value of money.59 In the Jessica Loan scenario, no commercial loan is foreseen60 Due to the large amount of free grants assigned to the project and the limited portion of investment costs devoted to revenue

generating activities the operation does not allow to recover the investment costs from the public perspective


pwc 63



recover the

initial

investment

made by the

Municipality

(EUR 3.189

thousands:

Equity+ free

grant).

The operation is

subject to

stability pact

rules.

2.940 thousands: Equity+

free grant).

Equity contribution by the

Municipality is lower than

in the baseline scenario

thanks to the lower

interests rate of the

JESSICA loan compared

to that of the commercial

loan (EUR 249 thousands

savings by the

Municipality)

Saved funds ( EUR 249

thousands) may be used

to finance other projects

Feasibility of the operation

shall be verified in

framework of the stability

pact.



funds are needed

compared to the baseline

scenario (EUR 259

thousands savings by the

Municipality)

Saved funds ( EUR 2.414

thousands) may be used

to finance other projects

The operation is not

subject to stability pact

rules.

The sum may be used to

finance other projects.


lower amount of

municipal funds are

needed compared to the

baseline scenario. Saved

funds may be used to

finance other projects

(EUR 259 thousands

savings by the

Municipality)

Saved funds ( EUR

2.414 thousands) may

be used to finance other

projects

The operation is not

subject to stability pact

rules.


The recourse todebt foreseen hasto be verified in theframework of thestability pact.

No recourse to commercial

loan foreseen

The recourse to debt is not

subject to stability pact rules.The recourse to debt is notsubject to stability pact rules.

Publicperspective

The projectforesees the use ofERDF andmunicipal funds, fora total amount ofEUR 19.392thousands. Theinitiative does notallow recoveringthe sum.



total amount of EUR


which almost EUR 3.868



The sum is not

recovered.

No reduction of ERDF +

Municipal funds possible


scenario.



total amount of EUR





The sum is not

recovered.



funds are needed


scenario.



total amount of EUR





The sum is not

recovered.


lower amount of

municipal funds are

needed compared to the

baseline scenario.

“Ex Manifattura Tabacchi” in Scafati

This project is the most promising of the three pilot projects identified, thanks to a balanced mix of

revenue-generating/no revenue-generating activities. However, some of the commercial activities

foreseen (in particular the hostel and the private offices) may not find an adequate demand in Scafati.

Even if conservative assumptions have been formulated to minimise overestimation of revenues, market

risk has to be carefully taken into account while analysing economic and financial results.


pwc 64

In the baseline scenario a large amount of free grants (EUR 9 million of EU/regional and municipal funds)

are assigned to the project for financing the part of the investment costs devoted to the realisation of

infrastructures for the public services for which no profit is foreseen. The remaining part of the investment

is expected to be financed by the private sector (private investors, financial institutions). Indicators of the

baseline scenario appear not attractive for the private investors (large investment, low profit and late

payback period against the high market risk).

The injection of JESSICA funds in the project allows a reduction private capital needed (lower recourse to

debt from financial institutions, reduction of equity contribution from the private investor) against an

overall increase of the profitability of the project for the private investor. Moreover, in all the three cases

the Municipality saves almost EUR 3,2 million since no free grant from the municipality is required to

make the project more attractive for the private sector and a shorter period of time is required for the

recovery of the whole public investment (Structural and regional funds, JESSICA funds, funds from the

Municipality).

The JESSICA loan scenario is considered the preferred one since it shows the best performance

indicators (higher IRR and shorter payback period) both for the private partner and for the Municipality.

From the JESSICA perspective, profitability of the investment over the lapse of time considered in the

analysis is lower than for the other two scenarios but it is still acceptable (taking into account the overall

principle of generating socio-economic returns along with pure financial returns).

Table 14 summarises quantitative results of the analysis, while a qualitative description is provided inTable 15.

Table 14 - “Ex Manifattura Tabacchi” in Scafati: Key performance indicators (IRR61:%; Payback: years62; Funds used:thousands EUR)



Private Partner

IRR 9,7% 15,3% 10,2% 15,0%

Payback 12 9 11 9

Funds used 5.837 3.571 3.571 3.493

JESSICA

IRR n.a 1,0% 2,8% 1,2%

Payback n.a 22 19 21

Funds used n.a 8.280 3.968 6.598

Municipality

IRR63 2,6% 5,9% 2,2% 5,0%

Payback 19 14 19 14

Funds used 3.150 - - -


IRR 4,1% 4,1% 4,1% 4,1%

Payback 17 17 17 17

Funds used 8.460 5.520 10.350 6.900

Public perspective(Structural

IRR n.a. n.a. n.a. n.a.

Payback 48 39 37 36

61 n.a.: parameter can’t be calculated62 Number of years necessary to recover the sum invested. The parameter does not take into account time value of money63 In kind contribution (land) is considered as out low for the calculation of IRR


pwc 65

Stakeholder Indicator Baseline JESSICA

funds/JESSICA/Municipality) 64

Funds used 9.000 14.130 9.818 13.181

ProjectIRR 4,4% 4,4% 4,4% 4,4%

Payback 17 17 17 17

Table 15 - “Ex Manifattura Tabacchi” in Scafati: Conclusions of the analysis

StakeholderBaseline

JESSICA


PrivatePartner

Indicators of the

baseline scenario are

not attractive for the

private sector

(extensive investment,

low profit, late payback

period) despite the

large amount of free

grants assigned to the

project (EUR 9 million).

Profitability indicators are

attractive for the private

sector, indeed they show:

Reduced investment

compared to the

baseline scenario.

High profitability (IRR:

15,3% over 23 years).

Investment recovery in

the medium term (9

years).

The scenario is less

attractive for the private

sector than the JESSICA

loan one (same amount

of funds invested, lower

profitability).

Profitability indicators are

attractive for the private sector,

indeed they show:

Reduced investment


scenario.

High profitability (IRR:

15,0% over 23 years).

Investment recovery in the

medium term (9 years).

JESSICAJESSICA instrumentsnot adopted.

Profitability of theinvestment over the lapseof time considered in theanalysis is acceptable (IRR:1,0 % over 23 years) takinginto account the overallprinciple of generatingsocio-economic returnsalong with pure financialreturns.

Profitability of theinvestment over the lapseof time considered in theanalysis is acceptable(IRR: 2,8 % over 23years) taking into accountthe overall principle ofgenerating socio-economic returns alongwith pure financialreturns.

Profitability of the investmentover the lapse of timeconsidered in the analysis isacceptable (IRR: 1,2 % over 23years) taking into account theoverall principle of generatingsocio-economic returns alongwith pure financial returns.

Municipality

EUR 3.150

thousands to be

assigned (on top of

the ERDF funds) by

the Municipality to

the project as free

grant in order to

make it become

revenue-generating.

The operation

allows the recovery

of the free grant

assigned in 19

years.

No recourse to

municipal funds.

Saved funds ( EUR


be used to finance other

projects

Participation to the

initiative through land

contribution allows to

gain a low profit of

around EUR 370

thousands in 23 years.

No recourse to

municipal funds.

Saved funds ( EUR


be used to finance

other projects

No recourse to municipal

funds.

Saved funds ( EUR 3.150

thousands) may be used to

finance other projects

Participation to the initiative

through land contribution

allows to gain a low profit of

around EUR 288 thousands

in 23 years.

64 Due to the large amount of EU/regional free grants assigned to the project and the limited portion of investment costs devoted to

revenue generating activities the operation does not allow to recover the investment costs from the public perspective


pwc 66

StakeholderBaseline

JESSICA



The project may not be

attractive for financial

institution due to the mix

of:

Large facility

amount required to

increase the

profitability of the

project for the

private partner.

High risk profile of

the project (high

market risk).

The reduced facility amount

compared to that of the

baseline scenario increases

the attractiveness of the

project for the financial

sector.

The project may not be

attractive for financial

institution due to the mix

of:

Large facility amount

required to increase

the profitability of the

project for the private

partner.

High risk profile of the

project (high market

risk).

The reduced facility amountcompared to that of thebaseline scenario increases theattractiveness of the project forthe financial sector

Publicperspective

The project foreseesthe use of ERDF andmunicipal funds, for atotal amount of EUR9.000 thousands. Theinitiative does not allowrecovering the sum.



total amount of EUR

14.130 thousands, out

of which almost EUR

8.280 thousands

covered by JESSICA

instruments.

The sum is not

recovered.

Under this scenario no

municipal funds are

needed.

The project foresees

the use of public

funds for a total

amount of EUR 9.818

thousands, out of

which almost EUR

3.968 thousands

covered by JESSICA

instruments.

The sum is not

recovered.

Under this scenario

no municipal funds

are needed.



total amount of EUR 13.181

thousands, out of which

almost EUR 6.598



The sum is not recovered.

Under this scenario no

municipal funds are needed.

Conclusions

Table 16 reports the preferred scenarios for each project and the related main indicators.

Table 16 - Chosen scenarios per project and related indicators per stakeholders involved (IRR: %; Payback: years, Funds:

million EUR)

Project ScenarioJESSICA

PrivatePartner

Municipality Financialinstitution

Public entities

IRR Payb. Funds65 IRR Payb. IRR Payb. IRR Payb. IRR Payb.

Parking andsquare inPortici

Equity +Loan

4,9% 15 0,78 16,3% 5 4,7% 14 4,1% 16 1,4 % 20

EducationalSite in Scafati

Equity 3,9% 4 2,05 n.a n.a n.a. n.a. 4,1% 4 n.a. n.a.

Ex ManifatturaTabacchi inScafati

Loan 1,0% 22 8,28 15,3% 9 5,9% 14 4,1% 17 n.a n.a

65 Amount in millions given as equity and/or loan.


pwc 67

4.1.2 Analysis of UDF and HF

Introduction

As described in paragraph 3.3.2, the proposed structure of JESSICA initiative in the Campania Region

foresees the adoption of one UDF whose sole investor is the JESSICA Campania HF. The UDF is

assumed here to be a bank, or a financial institution under a broader definition, that will have the

opportunity to co-finance projects through its own funds or other funds from private investors or other

banks/financial institutions. Project evaluation and fund management activities carried out by the financial

institution are paid by management fees recognised by the HF to the UDF. In accordance with EC

Regulation concerning eligible expenditures, the UDF management fees are paid by HF funds until 31

December 2015 and by projects income later on.

Likewise, the HF manages funds contributed by the Campania Region, against the payment of HF

management fees that are taken out of the ERDF funds contribution.

As for UDF management fees, HF management fees are subject to EC Regulation 1828/2006 concerning

eligible expenditures, and therefore are paid by ERDF funds until 31 December 2015 only.

For the simulation exercise of the JESSICA initiative, the HF invests in a UDF only through equity

contributions. The UDF invests in form of equity, loan or both in a portfolio 22 projects. Such portfolio is

the mix of “pilot” type projects (see paragraph 4.1.1) that is best suited with the amount of funds to be

invested and the expected financial results. The portfolio is made up of 13 projects of the “Parking and

Square” type, 5 projects of the “Educational Site” type and 4 projects of the “Manifattura Tabacchi” type of

projects included in PIU Europa and Altre Città initiatives. The total volume of investment funded by the

UDF amounts to approximately EUR 143 million (EUR 66 million are assumed to be “own funds” from

UDF/Financial Institutions, EUR 43 million are JESSICA loan and EUR 34 million are JESSICA equity).

The project portfolio worth approximately EUR 287 million includes free grants.

Description of the analyses carried out

Economic and financial models were implemented for the performance analysis of the HF and the UDF

with the aim of supporting the feasibility evaluation of the application of JESSICA Instruments to the two

urban regeneration initiatives (PIU Europa and Altre Città) in place in the Campania Region.

Assumptions used are described in the following tables.

Table 17 HF: main assumption for the quantitative simulation (thousands EUR)

Funds received from MA

Funds 100.000

MGT Fees

2010 – 2015 1,50%

from 2016 0,50%

Total MGT Fees until 2033 16.375

Total Amount to invest in UDFs 83.625

Cash account interest rate 1%


pwc 68

Table 18 UDF: main assumption for the quantitative simulation (thousands EUR)

Funds received from HF (Equity)

Funds 83.625

MGT Fees

MGT Fees

2011 – 2015 1,50%

from 2016 0,20%

Total MGT Fees until 2015* 4.534

Total MGT Fees until 2033 2.780

Total Amount to invest in Projects 79.091

* paid from HF funds ** paid fromprojects’ returns

Projects Portfolio

N° of projectsAmount JESSICA

FundsTotalLoan

Total Equity

Parking and square in Portici 13 33.865 10.160 23.706

Educational Site in Scafati 5 10.237 - 10.237

Ex Manifattura Tabacchi in Scafati 4 33.120 33.120 -

TOTAL 22 77.222 43.280 33.943

Financial Institution own funds

FI own capital perproject

N°of projects Total

Parking and square in Portici 1.824 13 23.706

Educational Site in Scafati 4.049 5 20.243

Ex Manifattura Tabacchi in Scafati 5.520 4 22.080

TOTAL 66.029

Results of the analyses

First output of the analyses is the quantification of main parameters of the structure of the JESSICA

Initiative described in paragraph 3.3.2. Results are summarised in the following figure.


pwc 69

Figure 14- Structure of the JESSICA initiative in the Campania Region (KEUR)

Based on the assumptions taken at project level and at UDF and HF level, performance parameters of

the operation were calculated from the HF, UDF, Financial Institution and Managing Authority perspective.

Holding Fund perspective

Table 19 HF: main performance indicators

Results for the HF reported in the table above show that the initiative will allow the HF to recover the

investment after 12 years66

. At that time HF Funding Agreement could be terminated and funds returned

to the Managing Authority. Our exercise assumes that the HF will be phased out when all projects have

repaid their debts to the UDF (after 23 years from the establishment of the HF).

66 12 years (payback period) is the time required to recoup the initial amount of the investment. The parameter does not take into

account the time value for money.

Funding Agreement 100.000

Manager JTF

Funds Received 100.000

MGT Fees (24 years) 16.375

Funds Invested in UDF 83.625

Unused funds 0

83.625

Funds received 83.625

Mgt Fees (24 years) until 2015 4.534

from 2016 2.780

Funds invested in Projects 77.222

Unused Funds 1.869

43.280 Jessica Equity 33.943 66.029

Parking and square

in Portici13 X

Educational Site in

Scafati 5 X

Ex Manifattura

Tabacchi in Scafati4 X

Managing Authority

Holding Fund

Projects


UDF

Jessica LoanUDF-Financial

Institution

Commercial Loan

IRR (24 years) 6,1%

Payback (years) 12

Managed Funds (thousands EUR) 100.000

Management Fees over 24 years (thousands EUR) 16.375

Funds Invested in UDF (thousands EUR) 83.625

Jessica CAMPANIA

HOLDING FUND


pwc 70

The following figure reports the aggregated cash flows for the HF, obtained taking into account the

investment in UDF and the management fees paid to UDF as outflows as well as , if applicable, the

dividends and capital gains from UDF, the cash flows from management fee from the Managing Authority

and the cash account interests as inflows.

Figure 15- HF: aggregated cash flow

UDF perspective

The results for the UDF are split between performance of the UDF itself and performance of the Financial

Institution or other similar entity that manages the UDF. Outflows for the UDF are the HF funds invested

in projects through JESSICA Loan or Equity and the management fees paid to the Financial Institution

after 2016 (paid by the projects’ incomes). Inflows for the UDF are the repayment of the invested funds by

the projects (principal and interests for the loans and dividends and or capital gains for equity

participation). Aggregated cash flow for the Financial Institution is reported in Figure 16. From the

perspective of the financial Institution, outflows are its own funds used for co financing projects via

commercial loans and inflows are the repayment of commercial loans by the projects (Principal and

interests) and the cash flow from management fees received (aggregated cash flow for the Financial

Institution is reported in Figure 17). Management fees are used for the calculation of the Financial

Institution’s IRR.

Main performance results are reported in Table 20.

Table 20 UDF: main performance indicators

(80.000)

(60.000)

(40.000)

(20.000)

-

20.000

40.000

60.000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Aggregated cash flow Jessica Campania Holding Fund

Outflows Inflows Cash flow for the HF

IRR UDF (24 years) 3,0%

Payback UDF (years) 17

IRR Financial Institution (24 years) 4,4%

Pay Back Financial Institution (years) 16

JESSICA funds managed 83.625

Funds invested in projects 66.029

Management Fees over 24 yeas (thousands EUR) 7.314

UDF/Financial

Institution


pwc 71

Figure 16- UDF: aggregated cash flow

Figure 17- Financial Institution: aggregated cash flow

Managing Authority perspective

According the above-mentioned assumptions, the structure of the initiative proposed allows the Managing

Authority to fully recover the funds invested after 19 years from the establishment of the HF. However, it

may decide to launch the second round of investments (first revolving cycle) earlier with a lower amount

of funds (Cf. Table 17). Our exercise assumes that the HF terminates when all projects have repaid their

debts to the UDF (after 23 years from the establishment of the HF). Revolving ratio67

after 23 years is

116%.

67 The revolving ratio is the ratio between the aggregated cash flow of the Holding Fund decreased by the management fee and the

initial capital contributed by the Managing Authority to the HF.

(60.000)

(50.000)

(40.000)

(30.000)

(20.000)

(10.000)

-

10.000

20.000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

UDF aggregated cash flow

Outflows Inflows Aggregated cash flow

(70.000)

(60.000)

(50.000)

(40.000)

(30.000)

(20.000)

(10.000)

-

10.000

20.000

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

FI aggregated Cashflow

Agg Cashflow


pwc 72

Table 21 Managing Authority: main performance indicators68

Conclusions- JESSICA added value

The introduction of the JESSICA instruments will allow the Managing Authority to benefit from the

revolving nature of the initiative, reaping the benefit of a tool that regenerates resources dedicated to

urban development independently from any other public fund that will be available under the next

programming period.

Furthermore, the stimulation of projects co financed by the UDF Financial Institution allows almost

doubling the funds available for investing in urban regeneration initiatives (EUR 77.222 thousands + EUR

66.029 thousands).

Last, but not least, the introduction of JESSICA instruments increases the profitability of projects, thus

making them more attractive for private investors and reducing the recourse to public free grants for the

realization of urban projects.

68 Management fees from MA: 2010-2015, 1,5% on invested capital (EUR 100 million) each year; from 2016 onward, 0,5% on

invested capital each year. Management fees to UDF: 2010-2015, 1,5% of yearly managed funds (paid from HF funds); 0,2% each

year of total managed funds (paid from projects’ return).

Nominal vaule of the contribution to HF (thousands

EUR)100.000

Management fees paid to HF (thousands EUR) 16.375

Management fees paid to UDF (thousands EUR) 4.534

Funds invested in Projects (thousands EUR) 77.222

Unused Funds (thousands EUR) 1.869

30 % revolving (years) 4




Global Revolving ratio (24 years) 116%

Managing Authority


pwc 73

European Investment Bank

JESSICA Evaluation Study-Implementing JESSICA Instruments in the Campania Region

Final Report – Annex 1: Identification and analysis of PilotProjects

October 2010

CONTENTS

Introduction

PIU Europa initiative

19 Medium-sized cities

Overview of pilot projects

Project “Parking and Square”, Portici

Project “Educational Building”, Scafati

Project “Ex manifattura tabacchi”, Scafati

Conclusions

Introduction

This document describes the analyses carried out to identify the “Pilot projects” to be used for the quantitative simulation of theintroduction of JESSICA financial instruments for financing interventions under the “PIU Europa” initiatives, in CampaniaRegion.

The “PIU Europa” Programme supports the creation of sustainable urban regeneration interventions included in the IntegratedUrban Plans (PIU Europa) of 19 medium-sized cities. These Plans consist of integrated interventions that aim at enhancingcompetitiveness and attractiveness of urban territories in Campania taking strongly into consideration the guidelines for territorialplanning specified in the Regional Territorial Plan (PTR). The Integrated Plans are developed by the cities on the basis of acontinuous dialogue with the Responsible for the Operational Objective 6.1. of the ERDF OP 2007-2013 (ROO).

In line with the goals of the “PIU Europa” initiative, the admissible operations pursue at least one of the following objectives:environmental recovery, social and economic regeneration; renewal, regeneration and re-use of “waterfronts”; renewal,regeneration and re-use of under-used or unused urban assets to create urban parks, aggregation of shops in particular cityareas that form outdoor commercial centres, artisan labs, expo areas, and social aggregation areas; improvement of localmobility systems; and of safety and security.

The interventions are focused on well-identified city areas. Territorial limits are set according to at least three decay indexes,selected taking into account relevant socio-economic and environmental issues (i.e.: environmental recovery; socio-economiccohesion, urban renewal and regeneration, etc.).

The screening of projects performed during the preliminary evaluation phase of the PwC assignment highlighted 13 projects ofthe PIU Europa initiative that showed a potential Jessicability and a number of other projects that, if aggregated in theappropriate way, could be Jessicable: 3 of these projects have been selected as pilot project for the quantitative simulation andare analysed in this Case Study.

Projects information and data have been provided by the ROO and its staff.

3

PIU Europa initiative

4

According to the EC Regulation 1080/06 and the European Commission’s Thematic Strategy on Urban Environment, theCampania Region launched the process for Integrated Urban Plans (PIU Europa) on February 15th, 2008.

The initiative is based on an approach integrating different types of projects within the broader scope of an comprehensive urbanregeneration programme. The approach adopted combines (directly or indirectly) different types of projects in a well coordinatedstructure and can combine several funding sources (ESF, FAS, EAFRD coherent with their specific eligibility expenses rules),together with the financial allocations already foreseen in Axis 6 “Sustainable Urban Development”.

The Integrated Plans are developed by the cities on the basis of a continuous dialogue with the ROO. The process kick-offs withthe execution of a Memorandum of Understanding between the Region and the medium-sized city, as well as other possible keyparties, followed by the setting up of a “control room”, overlooking the local partnership process and by the creation of a technical-administrative work team.

Each medium-sized city, through a participative planning process involving major stakeholders, defines the PIU EuropaProgramme, which constitutes the operating framework - including the identification and intermediate design of candidate projects- to give concrete application to the City Strategy Development Guidelines (DOS).

Projects that can be financed will have at least one of the following objectives (PIU Europa Objectives):



renewal, regeneration and re-use of under-used or unused urban assets to create urban parks, aggregation of shops inparticular city areas that form outdoor commercial centres, artisan labs, expo areas, and social aggregation areas;

improvement of local mobility systems; and

safety and security.

19 Medium-sized cities (1/2)

Battipaglia, Acerra, Salerno, Giugliano in Campania,

Torre del Greco, Pozzuoli, Casoria, Caserta,

Castellamare di Stabia, Afragola, Benevento,

Marano di Napoli, Portici, Avellino, Ercolano,

Cava de’Tirreni, Aversa, Scafati, Casalnuovo di Napoli

Through the D.G.R n.282\2008, the Campania Regionidentified the 19 medium-sized cities object of intervention. Thefollowing selection criteria were used:

• Demographic dimension, based on resident population(year 2006)

• Level of “residential deprivation” based on regional dataon building conditions and related use;

• Level of “socio-economic decay” based on socio-economic data of resident population. (i.e.: labourmarket’s statistics).

5

19 Medium-sized cities (2/2)

Demographic dimension

• The number of inhabitants should be larger than 50.000.

• Data have been estimated based on ISTAT statistics (year 2006);

• 19 cities with a population larger than 50.000 inhabitants have been identified, but Naples

Level of Residential deprivation

Estimations have been performed on the base of:

• the ratio between municipal inhabited buildings and total registered buildings for each city. The standardization has beenobtained applying the same ratio on regional basis: (index of housing intensity)

• the inverse ratio between the inhabited municipal surface and resident population. The standardization has beenobtained applying the same ratio on regional basis. (index of building burden)

• the information included in CIPE resolution identifying cities with high demographic pressure (this information has beenused as a dummy variable to highlight critical situations).

Level of Socio-economic decay

The index consists of a weighted average of different variables, as follows:

• the ratio between city ownership rate of elementary school-leaving certificates (i) and the regional average (TSi);

• the ratio between municipal unemployment rate (i) and the regional average (TDi);

• the ratio between incidence of families with less than 5 members on total families within the city (i) and the regionalaverage (IFNi);

• the ratio between incidence of families with a single parent on total families within the city(i) and the regional average(IFMi).

6

Overview of pilot projects

Based on the preliminary results of the screening exercise, criteria have been set for selectingpilot projects, in accordance with the priority set by the ROO. The following main criteria havebeen adopted:

• Investment amount (>5 M€);

• Potential return on the investment;

• Implementation stage (priority was given to initiatives in an advanced feasibility phase);

• Involvement of private partners;

• Interest expressed by the City who promoted the project in taking part to the JESSICAinitiative.

The selected pilot projects can be summarised as follows:

Parking and square in Portici: realization of an underground parking (150 parking spaces) in Portici and refurbishment of the publicsquare above .• Total investment: 5,96 M€.• PIU Europa objective: environmental recovery, social and economic regeneration .

“Educational Building ” in Scafati: realisation of a school, a gymnasium, an underground parking (190 parking spaces) andrefurbishment of the public square located in the site.• Total investment: 22,76 M €.• PIU Europa objectives: environmental recovery, social and economic regeneration; and renewal, regeneration and re-use of under-used

or unused urban assets to create urban parks, aggregation of shops in particular city areas that form outdoor commercial centres, artisanlabs, expo areas, and social aggregation areas.

“Ex Manifattura tabacchi” in Scafati: realisation of public services and of a multipurpose centre (public and private offices, shoppingcentre, hostel, public library).• Total investment: 23,106 M€.• PIU Europa objectives: environmental recovery, social and economic regeneration; and renewal, regeneration and re-use of under-used

or unused urban assets to create urban parks, aggregation of shops in particular city areas that form outdoor commercial centres, artisanlabs, expo areas, and social aggregation areas.

7

PorticiScafati

M € = million EUR

Project “Parking and square”, Portici: Characteristics

8

AREAThe intervention will be developed in thehistorical centre of Portici in order to enhancesocio-economic conditions and to obtainenvironmental benefits.

PROJECTThe project foresees the realisation of anunderground parking below the square so createpedestrian areas and to allow the renewal of thepublic square.

QUANTITATIVEDATA


• Investment cost: 5,46 M€

• Surface: 6.000 sqm

• no° of Parking spaces: 150

• no° of garage spaces for sale: 50

Square:

• Investment cost: 0,5M€


PIU EUROPAOBJECTIVES

Environmental recovery, social and economicregeneration

M € = million EUR

Project “Parking and Square”, Portici: Assumptions

Total investment: 5,96 M€

Revenues

Rent of parking spaces: tariff: 1€ per hour per parking space, opening hours per day: 16, occupancy rate: 75%

Sale of garage spaces: no° of garage spaces for sale: 50, sale price: 1100 €/sqm, sale period: during first and second year of investment

Operating Costs

Personnel: 5 FTE, Average salary per year: 30.000 €

Overheads: 15% of yearly cost of personnel

Facility Management: 30 €/sqm per year (cleaning, security, ordinary and extraordinary maintenance)

Working capital (investment phase):Payables: 90 days



Inflation rate: not applied

Commercial Loan: Maturity: 20 years, Yearly Interest rate: 3,92%,* Grace period: 3 years with interest payment

Jessica Loan: Maturity: 20 years, Yearly Interest rate: 0,98%**, Grace period: 3 years with interest payment

Distribution of dividends: 100% from the first year following the investment phase. Pari passu rule applied.

Economic Assumptions

Financial Assumptions

9M € = million EUR ;* real value corresponding to 6% nominal value at 2% inflation rate; ** real value corresponding to 3% nominal value at 2% inflation rate

Project “Parking and Square”, Portici: Baseline scenario 1/3

Construction and 20 years management of the infrastructure is assigned to a private entity against the payment of a yearly concessionfee. The private entity is chosen by the Municipality through a public tender.At the end of the concession agreement, the infrastructure is returned to Municipality with no residual value. The Municipality assignesfree grants to the project.

The economics of the baseline scenario do not allow therecourse to debt, notwithstanding the assignment of freegrants. As a consequence, project risk for a private investorbecomes very high and attractiveness of the projects fromprivate investors is very low

Funding

Equity (k€) 4.960

Municipality 0,0%

Private Partner 100,0%

Debt (k€) -

Free Grant (k€) 1.000

EU/Regional 350

Municipal 650

Sources of financingKey performance indicators (IRR* :%; Payback: years**;Funds used: k€)

Management model

Conclusions

10

Stakeholder Indicator Baseline

Private PartnerIRR 5,1%

Payback 15Funds used 4.960

JESSICAIRR n.a.

Payback n.a.Funds used n.a.

MunicipalityIRR*** 4,1%

Payback 16Funds used 650

Financial InstitutionIRR n.a.

Payback n.a.Funds used 0


funds/JESSICA/Municipality)

IRR**** 0,1%Payback 23

Funds used 1.000

ProjectIRR 5,6%

Payback 15

*n.a.: parameter can’t be calculated (negative value).**Number of years necessary to recover the sum invested. Theparameter does not take into account time value for money.***Outflows: In kind contribution (land) and free grant; inflows:concession fee or dividends.****In kind contribution (land) is considered as outflow for thecalculation of IRR.

k € = thousands EUR


Profit and Loss Account (k€)

Projection year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

+ Operatingrevenues 660 990 372 745 745 745 745 745 745 745 745 745 745 745 745 745 745 745 745 745 745 745 745- Operating costs 35 35 249 326 326 326 326 326 326 326 326 326 326 326 326 326 326 326 326 326 326 326 326- Depreciation 546 819 - 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205

Parking for rent - - - 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205Parking for sale 546 819 - - - - - - - - - - - - - - - - - - - - -

EBIT 80 137 123 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214- Financial costs - - - - - - - - - - - - - - - - - - - - - - -EBT 80 137 123 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214- Income Taxes 33,00% 26 45 41 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71NET INCOME 53 91 83 144 144 144 144 144 144 144 144 144 144 144 144 144 144 144 144 144 144 144 144

Project Cash Flow Statement (k€)

Projection year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23+ EBIT 80 137 123 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214 214- Adjusted Taxes 26 45 41 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71+ Depreciation 546 819 - 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205 205

+ Free Grants 350 70 210 70 - - - - - - - - - - - - - - - - - - - -- working capitalrequirements (294) (588) 588 294 - - - - - - - - - - - - - - - - - - -

Investment 90 294 882 294 - - - - - - - - - - - - - - - - - - - -- Capex 1.192 3.576 1.192 - - - - - - - - - - - - - - - - - - - -

Parking for rent 819 2.457 819 - - - - - - - - - - - - - - - - - - - -Parking for sale 273 819 273 - - - - - - - - - - - - - - - - - - - -Square 100 300 100 - - - - - - - - - - - - - - - - - - - -

FREE CASH FLOW (229) (1.868) (1.627) 54 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348

11k € = thousands EUR


Uses and sources of Funds (k€)

Projection year TOTAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23EBITDA 5.610 626 956 123 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419Equity 4.960 992 2.976 992 - - - - - - - - - - - - - - - - - - - -Private entity 4.960 992 2.976 992 - - - - - - - - - - - - - - - - - - - -

Loan - - - - - - - - - - - - - - - - - - - - - - - -Free Grant 1.000 200 600 200 - - - - - - - - - - - - - - - - - - - -

Previous yearcash account - 599 1.5101.592 - - - - - - - - - - - - - - - - - - -SOURCES 1.818 5.131 2.8252.011 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419Investmentexpenses 5.960 1.192 3.576 1.192 - - - - - - - - - - - - - - - - - - - -Parking for rent 819 2.457 819 - - - - - - - - - - - - - - - - - - - -

Square 100 300 100 - - - - - - - - - - - - - - - - - - - -Parking for sale 273 819 273 - - - - - - - - - - - - - - - - - - - -

Debtrepayment - - - - - - - - - - - - - - - - - - - - - - - -Cash account 599 1.510 1.592 - - - - - - - - - - - - - - - - - - - -Financial costs - - - - - - - - - - - - - - - - - - - - - - -

Income taxes 26 45 41 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71 71Dividends 7.863 - - -1.941 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348 348

USES 1.818 5.131 2.8252.011 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419 419


Stakeholder IndicatorJESSICA


Private PartnerIRR 3,6% 4,2% 16,3%

Payback 18 16 5Funds used 3.472 1.736 782

JESSICAIRR 1,0% 4,2% 4,9%

Payback 21 16 15Funds used 595 1.736 2.605

MunicipalityIRR**** n.a. n.a. 4,7%

Payback 27 24 14Funds used 650 650 400

Financial InstitutionIRR 4,1% 4,1% 4,1%

Payback 16 16 16Funds used 893 1.488 1.824

Public perspective (Structuralfunds/JESSICA/Municipality)

IRR***** n.a. 2,3% 1,4%Payback 29 23 20

Funds used 1.595 2.736 3.755

ProjectIRR 5,6% 5,6% 5,6%

Payback 15 15 15

Project “Parking and Square”, Portici: Jessica Scenarios

Construction and 20 years management of the infrastructure assigned to a PPP (Private entity/Municipality). The Private partner, chosen by theMunicipality through a public tender, participates to the PPP equity through cash contributions, while the Municipality contributes the land. Both receivedividends as remuneration of equity contributions.The Private Partner is in charge of the operating management of the infrastructure.At the end of the PPP agreement, the infrastructure is returned to Municipality with no residual value. The Municipality assigns free grants to the project.

Sources of financing Key performance indicators (IRR** :%; Payback: years***; Funds used: k€)

Management model

JESSICA Scenarios

Loan EquityEquity/Loan

JESSICADebt yes no yes

Equity no yes yes

Funding

Equity (k€) 3.472 3.472 1.563

Municipality* 0,0% 0,0% 0,0%PrivatePartner

100,0% 50,0% 50,0%

JESSICA 0,0% 50,0% 50,0%

Debt (k€) 1.488 1.488 3.647CommercialLoan

60,0% 100,0% 50,0%

JESSICA 40,0% 0,0% 50,0%

Free Grant (k€) 1.000 1.000 750

EU/Regional 350 350 350

Municipal 650 650 400TotalJESSICA (k€)

595 1.736 2.605

*The land constitutes contribution in kind by theMunicipality. Equity percentages do not includecontributions in kind.

**n.a.: parameter can’t be calculated (negative value).***Number of years necessary to recover the sum invested. The parameter does not takeinto account time value for money.****Outflows: In kind contribution (land) and free grant; inflows: concession fee ordividends.*****In kind contribution (land) is considered as outflow for the calculation of IRR.


Project “Parking and Square”, Portici: Qualitative results

14



PrivatePartner

Large amount of private capitalrequired.

All project risks (investment,management and market risks)borne by the private partner.

Profitability of the investmentover the lapse of timeconsidered in the analysis (IRR:5,1% over 23 years) not highenough to justify the high riskyinvolvement of a private partnerin the project.

Large amount of private capitalrequired.

Profitability of the investmentover the lapse of timeconsidered in the analysis lowerthan that of the baselinescenario.(IRR: 3,6% over 23years).

Longer time required for therecovery of the initial investmentthan in the baseline scenario.

Lower amount of private capitalrequired than in the baselinescenario and in the Jessica Loanscenario.

Profitability of the investment overthe lapse of time considered in theanalysis is lower than that of thebaseline scenario.(IRR: 4,2% over23 years)

Longer time required for therecovery of the initial investmentthan in the baseline scenario.

Lower amount of private capitalrequired than in all other scenarios.

High profitability of the investmentover the lapse of time considered forthe analysis (IRR: 16,3% over 23years).

Recovery of the investment possiblein a short period of time (5 years).

Investment risk shared with Jessicainstrument and with the bank.

JESSICA Jessica instruments non adopted.

Due to the economics of the project,recourse to debt is possible forfinancing only a small amount ofinvestment. Thus the adoption ofJessica instruments in form of loanis very limited (€ 595 k).

Profitability of the investment over thelapse of time considered in theanalysis is acceptable (IRR: 4,2 %over 23 years) taking into account theoverall principle of generating socio-economic returns along with purefinancial returns.

Profitability of the investment over thelapse of time considered in the analysisis acceptable (IRR: 4,9 % over 23 years)taking into account the overall principleof generating socio-economic returnsalong with pure financial returns.

Municipality

€ 650 k to be assigned (on topof the ERDF funds) by theMunicipality to the project asfree grant in order to make itbecome profitable.

The operation allows therecovery of the free grantassigned in 16 years and a lowreturn on investment at the endof the concession period (€ 75 kin 23 years).

€ 650 k to be assigned (on top ofthe ERDF funds) by theMunicipality to the project as freegrant in order to make it becomeprofitable.

The operation does not allow therecovery of the free grantassigned in the lapse of timeconsidered for the analysis (23years).

Stability pact rules notapplicable.

€ 650 k to be assigned (on top ofthe ERDF funds) by theMunicipality to the project as freegrant in order to make it becomeprofitable.

The operation does not allow therecovery of the free grantassigned in the lapse of timeconsidered for the analysis (23years).

Stability pact rules not applicable.

Reduced amount of free grant to beto be assigned (on top of the ERDFfunds) by the Municipality to theproject as free grant in order to makeit become profitable ( € 400 k against€ 650 k needed in the otherscenarios)

The operation allows the recovery ofthe free grant assigned in 14 yearsand a return on investment at theend of the concession period (€ 107k in 23 years).

Stability pact rules not applicable.

Project “Parking and Square”, Portici: Conclusions

15

The economic and financial analysis of the baseline scenario shows that it would not be a viable solution for the development of theproject. On the base of the model assumptions, notwithstanding the assignment of free grants to the project:

the amount of cash available for financing is limited and does not allow the recourse to debt; investment risks would entirelybear on the private investor;

against a large amount of equity investment required, profitability of the project for the private investor is very low.

As a consequence, the project would not attract private investors.

The introduction of Jessica instruments improves the attractiveness for private investors in all three cases (by increasing the profitabilityand/or reducing the amount of equity investment by the private investors). The Equity and Loan case has been chosen as the preferredone. Indeed, it shows the best performance for all stakeholders, but Jessica. However, JESSICA indicators can be consideredacceptable taking into account the overall principle of generating socio-economic returns along with pure financial returns. Moreover, thisscenario results to be attractive for private investors due to the high profitability (16,3%) and the limited amount of private investmentforeseen (EUR 782 thousands). In addition, it foresees a reduction in the recourse to municipal funds, allowing a EUR 200 thousandssaving that can be used for financing under a free grant scheme other, less profitable, projects.

Results of the analysis

Project “Educational Building” in Scafati: Characteristics

16

AREAThe new Educational Building will be located in the citycentre. The site hosts various buildings that arecurrently unused .

PROJECTThe core of the intervention consists of the realisationof a building dedicated to events and sport activities.The project will be realized through the demolition andreconstruction of the existing buildings. Theintervention is divided in three lots: Lot A (schoolbuilding) , Lot B (underground parking andgymnasium), and Lot C (Aldo Moro square).

QUANTITATIVEDATA

School:

• Investment costs: 6,81 M€

Gymnasium:





• Surface: 4.750 sqm,

• no° of parking spaces: 190

Square:



PIU EUROPAOBJECTIVES


Renewal, regeneration and re-use of under-used orunused urban assets

M € = million EUR

Project “Educational Building” in Scafati: Assumptions


Revenues

Sale of underground parking and land: Sale price for the underground parking: 20% margin on investment costs, Sale price for the land:100€/sqm, Sale period: first year following investment period

Operating Costs

Negligible

Working capital (investment phase): Payables: 90 days



Commercial Loan: Maturity: 20 years, Yearly Interest rate: 3,92%*, Grace period: 3 years with interest payment






Project “Educational Building” in Scafati: Baseline scenario 1/2

The Municipality will realize the whole intervention with its own funds and will sell the underground parking and the land to a privatecompany selected through a public tender.

Indicators of the baseline scenario show that theMunicipality will not recover the investment through theselling of its assets. In addition, the possibility to use debthas to be verified in the framework of the stability pact.

Funding

Equity (k€) 2.155

Municipality 100,0%


Debt (k€) 3.868


EU/Regional 16.203

Municipal 1.034


Management model

Conclusions

18


JESSICA

IRR n.a

Payback n.a

Funds used n.a

Municipality

IRR n.a.

Payback n.a.

Funds used 3.189


IRR 4,1%

Payback 4

Funds used 3.868


funds/JESSICA/Municipality

IRR n.a.

Payback*** n.a.

Funds used 19.392

ProjectIRR 0,5%

Payback 4

***Due to the large amount of free grants assigned to the project andthe limited portion of investment costs devoted to revenue generatingactivities the operation does not allow to recover the investment costsfrom the public perspective.


*n.a.: parameter can’t be calculated (negative value)**Number of years necessary to recover the sum invested. Theparameter does not take into account time value for money.

Project “Educational Building” in Scafati: Baseline scenario 2/2


Projection year 1 2 3 4+ Revenues from sale(Und. Parking)

20% - - - 6.630

+ Land sale - - - 500- Depreciation - - - 5.525

Undergroundparking

- - - 5.525

EBIT - - - 1.605

- Financial costs 30 121 152 -

EBT (30) (121) (152) 1.605

- Income Taxes 33,00% - - - 530

NET INCOME (30) (121) (152) 1.075


Projection year 1 2 3 4

+ EBIT - - - 1.605

- Adjusted Taxes - - - 530

+ Depreciation - - - 5.525

+ Free Grants 16.203 3.241 9.722 3.241 -

- working capitalrequirements (1.123) (2.245) 2.245 1.123

Investment 90 1.123 3.368 1.123 -

- Capex 4.553 13.658 4.553 -

School 1.364 4.091 1.364 -

Gymnasium 714 2.141 714 -Underground parking 1.105 3.315 1.105 -

Square 1.370 4.110 1.370 -

FREE CASH FLOW (189) (1.691) (3.557) 5.478


Projection year TOTAL 1 2 3 4

EBITDA - - - 7.130

Equity 2.155 431 1.293 431 -

Municipality 2.155 431 1.293 431 -

Loan 3.868 774 2.321 774 -

Free Grant 17.237 3.447 10.342 3.447 -

Previous year cashaccount - 69 246 194

SOURCES 4.652 14.025 4.898 7.324Investmentexpenses 22.763 4.553 13.658 4.553 -

School 1.364 4.091 1.364 -

Gymnasium 714 2.141 714 -

Undergound parking 1.105 3.315 1.105 -

Square 1.370 4.110 1.370 -

Debt repayment 3.868 - - - 3.868

Cash account 69 246 194 -

Financial costs 30 121 152 -

Income taxes - - - 530

Dividends 2.927 - - - 2.927USES 4.652 14.025 4.898 7.324




JESSICA

IRR 1,0% 3,9% 4,0%

Payback 4 4 4

Funds used 3.868 2.047 5.379

MunicipalityPayback 4 - -

Funds used 2.940 776 776

Financial Institution****

IRR - 4,1% 4,1%

Payback - 4 4

Funds used - 4.049 578

Public perspective(Structural funds/

JESSICA/Municipality

IRR n.a. n.a. n.a.

Funds used 23.011 19.026 22.358


Payback 4 4 4

JESSICA Scenarios



Equity no yes yes

Funding

Equity (k€) 1.906 2.047 3.065

Municipality* 100,0% 0,0% 0,0%

JESSICA 0,0% 100,0% 100,0%

Debt (k€) 3.868 4.049 2.862CommercialLoan

0,0% 100,0% 20,0%

JESSICA 100,0% 0,0% 80,0%

Free Grant (k€) 17.237 16.979 16.979

EU/Regional 16.203 16.203 16.203

Municipal 1.034 776 776TotalJESSICA (k€)

3.868 2.047 5.379

Project “Educational Building” in Scafati: Jessica Scenarios

Jessica Loan ScenarioThe same as baseline scenario.Jessica Equity and Jessica Equity and Loan ScenariosThe whole intervention is realised by a PPP between the Municipality and the UDF. UDF participates to the PPP equity through cash contributions while theMunicipality contributes the land. The PPP sells the underground parking and the land to a private company selected through a public tender. At the end ofthe operation, the rest of the buildings are recognised to the Municipality with no residual . The Municipality assigns free grants to the project.

The introduction of Jessica Loan leaves the situation basically unchanged comparedwith the baseline. The scenario is completely different in the other two cases that do notforesee any funds contribution from the Municipality side, but assignment of free grants.Need of free grant is, however, reduced if compared to the other cases. Jessica Equityand Jessica Equity and Loan scenarios report similar results. Against a very limitedbetter performance of the latter, the former allows a reduced use of Jessica funds andan overall decrease of recourse to public funding.

Sources of financing Key performance indicators (IRR**:%; Payback: years***; Funds used: k€)

Management model

Conclusions*The land constitutes contribution in kind by the Municipality(all but Jessica Loan case). Equity percentages do notinclude contributions in kind.**n.a.: parameter can’t be calculated (negative value)***Number of years necessary to recover the sum invested.The parameter does not take into account time value formoney.

20


****In the JESSICA loan scenario, no commercial loan is foreseen

Project “Educational Building” in Scafati: Qualitative results

21



JESSICAJessica instruments notadopted.

Profitability of the investment isacceptable taking into account: the limited number of years required to

recover the investment (4 years) the overall principle of generating

socio-economic returns along withpure financial returns.

Profitability of the investment isacceptable taking into account: the limited number of years

required to recover theinvestment (4 years)

the overall principle ofgenerating socio-economicreturns along with purefinancial returns

Profitability of the investment isacceptable taking into account: the limited number of years

required to recover the investment(4 years)

the overall principle of generatingsocio-economic returns along withpure financial returns

Municipality

Sale of the undergroundparking and land is notenough to recover the initialinvestment made by theMunicipality (€ 3.189 k:Equity+ free grant).

The operation is subject tostability pact rules.

As in the baseline scenario, sale of theunderground parking and land is notenough to recover the initialinvestment made by the Municipality(€ 2.940 k: Equity+ free grant).

Equity contribution by the Municipalityis lower than in the baseline scenariothanks to the lower interests rate ofthe Jessica loan compared to that ofthe commercial loan (€ 249 k savingsby the Municipality)

Saved funds ( € 249 k) may be used tofinance other projects

The operation is not subject tostability pact rules.

No recourse to equitycontribution by theMunicipality results in €2.155 k of Municipal fundssavings.

Under this scenario, a loweramount of municipal fundsare needed compared to thebaseline scenario (€ 259 ksavings by the Municipality)

Saved funds ( € 2.414 k)may be used to financeother projects

The operation is not subjectto stability pact rules.

No recourse to equity contributionby the Municipality results in €2.155 k of Municipal fundssavings. The sum may be used tofinance other projects.

Under this scenario, a loweramount of municipal funds areneeded compared to the baselinescenario. Saved funds may beused to finance other projects (€259 k savings by the Municipality)

Saved funds ( € 2.414 k) may beused to finance other projects

The operation is not subject tostability pact rules.


Project “Educational Building” in Scafati: Conclusions

22

This project is characterised by a large part of the investment costs (around 76% of the total investment costs) devoted to the realisationof infrastructures for social purposes (school and square) for which no economic return is foreseen. For this reason, a high amount offree grants are assigned to the project (regional and municipal free grants). The Municipality intends to recover part of the investmentcosts by selling the underground parking realised below the square.

In the baseline scenario, the Municipality realises the project by its own, participating as an equity investor. Indicators of the baselinescenario show that the Municipality will not recover the investment (equity plus free grant) through the sale of its assets. In addition, theoperation has to be analysed in the framework of the stability pact.

All Jessica scenarios benefit the Municipality. The Jessica Loan scenario allows a decrease of equity contributions from the Municipality,thanks to the lower interest rate applied by the commercial banks within the Jessica framework that the one usually applied. Thus, EUR249 thousands can be saved by the Municipality and used for other purposes. In addition, this scenario allows the recovery of theinvestment made by the Municipality (equity and free grants). However, the feasibility of the operation should be verified in the frameworkof the stability pact. Under Jessica Equity and Jessica Equity/Loan scenarios the only equity investor is Jessica. The low profitability ofthe operation would not attract any private investor . At the end of the construction phase, the infrastructure is sold to a private operator.In both scenarios the Municipality would save EUR 2.414 thousands compared to the baseline one and the operation would not besubject to the stability pact rules. Saved funds may be used by Municipality to finance other projects Performance parameters of theJessica Equity and Jessica Equity/Loan scenarios are very similar.

The JESSICA Equity scenario has been chosen as the preferred one since:

it ensures feasibility of the operation in the context of the stability pact while guarantying saving of funds by the Municipalityand

it entails a lower risk profile from the JESSICA perspective (lower amount of funds required) compared to the other cases.


Project “Ex Manifattura tabacchi”, Scafati: Characteristics

AREA

The intervention is located in a central area ofScafati that needs regeneration and renewal:today this area hosts heterogeneous buildingsdevoted to with a mix of functions.

PROJECT

The project mainly consists of renewal,regeneration and valorisation of the “ExManifattura tabacchi”.

The valorisation will transform the old factoryinto a multipurpose building.

The intervention is structured in 2 main functionalareas: Lot 1 and Lot 2.

QUANTITATIVEDATA

• LOT 1 - Public Services: Municipality Offices(5.824 sqm) Baby Park (300 sqm) and thePolice Office (1.124 sqm)

• LOT 2 - Multipurpose Centre: parking area(3.003 sqm - 157 parking spaces), Food Hall(1.258 sqm), Commercial Activities (1.485sqm), Fitness Centre (975 sqm), Youth hostel(815 sqm-80 beds), Private offices(1.399sqm), Library (2.109 sqm)

PIU EUROPAOBJECTIVE


renewal, regeneration and re-use of under-used or unused urban assets

Project “Ex Manifattura tabacchi”, Scafati: Assumptions


Revenues:

Underground parking: 5% of construction costs per year;

Private offices: 5% of construction costs per year;

Youth hostel: 4% of construction costs per year;

Food Hall rent: 400 €/sqm per year, occupancy rate: 80%;

No-Food Commercial activities: rent 600 €/sqm per year, occupancy rate: 80%;

Fitness Centre: rent: 200 €/sqm per year.

Operating Costs:

Personnel: 5 FTE, Average salary per year: 40.000 €,

Overheads: 15% of yearly cost of personnel

Facility Management: 30 €/sqm per year (cleaning, security, ordinary and extraordinary maintenance)

Working capital (investment phase): Payables: 90 days




Management fee over construction paid to private partner: 8% on construction costs

Commercial Loan: Maturity: 20 years, Yearly Interest rate: 3,92%*, Grace period: 3 years with interest payment






Project “Ex Manifattura tabacchi”, Scafati: Baseline scenario 1/3

Construction of the whole intervention and 20 years management of the Multipurpose centre is assigned to a private entity against thepayment of a yearly concession fee. The private entity is chosen by the Municipality through a public tender.At the end of the concession agreement, the infrastructure is returned to Municipality with no residual value . The Municipality assignsfree grants to the project.

Indicators of the baseline scenario are not attractive for theprivate sector (extensive investment, low profit, latepayback period) notwithstanding the large amount of freegrants assigned to the project (9M€).


Management model

Conclusions

25

Funding

Equity (k€) 6.486

Municipality 0,0%


Debt (k€) 8.460


EU/Regional 5.850

Municipal 3.150


Private PartnerIRR 9,7%

Payback 12

Funds used 5.837

JESSICAIRR n.a

Payback n.a

Funds used n.a

MunicipalityIRR*** 2,6%

Payback 19

Funds used 3.150

Financial InstitutionIRR 4,1%

Payback 17

Funds used 8.460Public perspective

(Structural funds/JESSICA/Municipality)****

Payback 48

Funds used 9.000

ProjectIRR 4,4%

Payback 17

*n.a.: parameter can’t be calculated**Number of years necessary to recover the sum invested.The parameter does not take into account time value for money***In kind contribution (land) is considered as outflow for thecalculation of IRR

M € = million EUR; k € = thousands EUR

****Due to the large amount of EU/regional free grants assigned tothe project and the limited portion of investment costs devoted torevenue generating activities the operation does not allow to recoverthe investment costs from the public perspective



Projection year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

+ EBIT - - 525 870 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189- AdjustedTaxes

- - 173 287 62 62 62 62 62 62 62 62 62 62 62 62 62 62 62 62 62 62 62 62

+ Depreciation - - - - 1.1551.155 1.155 1.1551.1551.1551.155 1.1551.1551.1551.1551.155 1.155 1.155 1.155 1.155 1.155 1.155 1.155 1.155+ Free Grants 5.850 1.170 2.925 1.170 585 - - - - - - - - - - - - - - - - - - - -- workingcapitalrequirements

(1.139) (1.709) 1.709 570 - - - - - - - - - - - - - - - - - - - -

Investment 90 1.139 2.848 1.139 570 - - - - - - - - - - - - - - - - - - - -- Capex 4.620 11.550 4.620 2.310 - - - - - - - - - - - - - - - - - - - -

Lot 1 – Lot 2 4.620 11.550 4.620 2.310 - - - - - - - - - - - - - - - - - - - -

FREE CASH FLOW (2.311) (6.916) (4.807)(1.712) 1.2821.282 1.282 1.2821.2821.2821.282 1.2821.2821.2821.2821.282 1.282 1.282 1.282 1.282 1.282 1.282 1.282 1.282

26


Projection year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

+ Operatingrevenues - - 663 1.1681.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642 1.642- Operating costs - - 138 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298 298-Depreciation - - -

Lot-Lot 2 - - -EBIT - - 525 870 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189 189

- Financial costs 66 232 299 332 321 309 297 284 271 257 243 229 213 197 181 164 146 127 108 88 67 46 23 -EBT- Income Taxes 33,00% - - 75 178 - - - - - - - - - - 3 8 14 20 27 33 40 47 55 62NET INCOME (66) (232) 151 361 (131) (120) (108) (95) (82) (68) (54) (40) (24) (8) 5 17 29 41 54 68 82 96 111 127

1.1551.155 1.155 1.1551.1551.1551.155 1.1551.1551.1551.1551.155 1.155 1.155 1.155 1.155 1.155 1.155 1.155 1.1551.1551.155 1.155 1.1551.1551.1551.155 1.1551.1551.1551.1551.155 1.155 1.155 1.155 1.155 1.155 1.155 1.155 1.155

(66) (232) 226 538 (131) (120) (108) (95) (82) (68) (54) (40) (24) (8) 8 25 43 62 81 101 122 143 166 189

--




27

Projectionyear TOTAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24

EBITDA - - 525 870 1.344 1.3441.3441.3441.344 1.3441.344 1.3441.3441.3441.3441.344 1.3441.3441.3441.344 1.3441.3441.3441.344Equity 6.486 1.297 3.243 1.297 649 - - - - - - - - - - - - - - - - - - - -Private entity 6.486 1.297 3.243 1.297 649 - - - - - - - - - - - - - - - - - - - -

Loan 8.460 1.692 4.230 1.692 846 - - - - - - - - - - - - - - - - - - - -Free Grant 9.000 1.800 4.500 1.800 900 - - - - - - - - - - - - - - - - - - - -Previous yearcash account - 103 294 614 - - - - - - - - - - - - - - - - - - - -SOURCES 4.78912.076 5.607 3.879 1.344 1.3441.3441.3441.344 1.3441.344 1.3441.3441.3441.3441.344 1.3441.3441.3441.344 1.3441.3441.3441.344Investmentexpenses 23.100 4.620 11.550 4.620 2.310 - - - - - - - - - - - - - - - - - - - -Debtrepayment 8.460 - - - - 286 298 309 321 334 347 361 375 390 405 421 437 454 472 491 510 530 551 572 595Cash account 103 294 614 - - - - - - - - - - - - - - - - - - - - -FinancialcostsIncome taxes - - 75 178 - - - - - - - - - - 3 8 14 20 27 33 40 47 55 62Dividends 13.518 - - - 1.060 737 738 738 739 739 740 741 741 740 735 729 724 718 713 707 700 694 687

USES 4.78912.076 5.607 3.879 1.344 1.3441.3441.3441.344 1.3441.344 1.3441.3441.3441.3441.344 1.3441.3441.3441.344 1.3441.3441.3441.344

66 232 299 332 321 309 297 284 271 257 243 229 213 197 181 164 146 127 108 88 67 46 23 -

742738




Private PartnerIRR 15,3% 10,2% 15,0%

Payback 9 11 9Funds used 3.571 3.571 3.493

JESSICAIRR 1,0% 2,8% 1,2%


MunicipalityIRR**** 5,9% 2,2% 5,0%

Payback 14 19 14Funds used - - -

Financial InstitutionIRR 4,1% 4,1% 4,1%


Public perspective(Structural funds/

JESSICA/Municipality)*****

Payback 39 37 36

Funds used 14.130 9.818 13.181


Payback 17 17 17

Project “Ex Manifattura tabacchi”, Scafati: Jessica Scenarios

Construction of the whole intervention and 20 years management of the Multipurpose centre is assigned to a PPP between the Municipality (thatcontributes the land) and a Private Partner chosen through a public tender (that contributes cash). The Private Partner is in charge of the supervision ofconstruction works (against the receipt of a management fee over construction costs) and of the operating management of the Multipurpose centre.Both parties receive dividends as remuneration of equity contributions.Against the free grant assigned to the project by the Municipality and the Region, the public partner does not pay any rent for the use of the public library. Inaddition, at the end of the PPP agreement, the infrastructure is returned to Municipality with no residual value.

Compared to the baseline scenario, all Jessica scenarios result in a smaller amount offree grants required against better performance indicators for the private sector (theJessica Loan case showing the highest result).

Sources of financing Key performance indicators (IRR**:%; Payback: years***; Funds used: k€)

Management model

Conclusions

JESSICA Scenarios



Equity no yes yes

Funding

Equity (k€) 3.968 7.935 4.313

Municipality* 0,0% 0,0% 0,0%

Private Partner 100,0% 50,0% 90,0%

JESSICA 0,0% 50,0% 10,0%

Debt (k€) 13.800 10.350 13.800

CommercialLoan

40,0% 100,0% 50,0%

JESSICA 60,0% 0,0% 50,0%

Free Grant (k€) 5.850 5.850 5.850

EU/Regional 5.850 5.850 5.850

Municipal - - -

Total JESSICA(k€)

8.280 3.968 7.331

*The land constitutes contribution in kind by the Municipality.Equity percentages do not include contributions in kind.**n.a.: parameter can’t be calculated***Number of years necessary to recover the sum invested.The parameter does not take into account time value formoney****In kind contribution (land) is considered as outflow for thecalculation of IRR

28

[1] In kind contribution (land) is considered as out low for the calculation of IRR


*****Due to the large amount of EU/regional free grants assigned to the project and thelimited portion of investment costs devoted to revenue generating activities theoperation does not allow to recover the investment costs from the public perspective

Project “Ex Manifattura Tabacchi”, Scafati: Qualitative results

29



PrivatePartner

Indicators of the baselinescenario are not attractive for theprivate sector (extensiveinvestment, low profit, latepayback period) despite the largeamount of free grants assigned tothe project (€ 9M).

Profitability indicators are attractive for theprivate sector, indeed they show: Reduced investment compared to the

baseline scenario. High profitability (IRR: 15,3% over 23

years). Investment recovery in the medium term

(9 years).

The scenario is less attractivefor the private sector than theJessica loan one (sameamount of funds invested,lower profitability).

Profitability indicators are attractive forthe private sector, indeed they show: Reduced investment compared to

the baseline scenario. High profitability (IRR: 15,0% over

23 years). Investment recovery in the

medium term (9 years).

JESSICA Jessica instruments not adopted.

Profitability of the investment over the lapseof time considered in the analysis isacceptable (IRR: 1,0 % over 23 years) takinginto account the overall principle ofgenerating socio-economic returns alongwith pure financial returns.

Profitability of the investmentover the lapse of timeconsidered in the analysis isacceptable (IRR: 2,8 % over23 years) taking into accountthe overall principle ofgenerating socio-economicreturns along with purefinancial returns.

Profitability of the investment over thelapse of time considered in theanalysis is acceptable (IRR: 1,2 %over 23 years) taking into account theoverall principle of generating socio-economic returns along with purefinancial returns.

Municipality

€ 3.150 k to be assigned (ontop of the ERDF funds) by theMunicipality to the project asfree grant in order to make itbecome profitable.

The operation allows therecovery of the free grantassigned in 19 years.

No recourse to municipal funds. Saved funds ( € 3.150 k) may be used to

finance other projects Participation to the initiative through land

contribution allows to gain a low profit ofaround € 370 k in 23 years.

No recourse to municipalfunds.

Saved funds ( € 3.150 k)may be used to financeother projects

No recourse to municipal funds. Saved funds ( € 3.150 k) may be

used to finance other projects Participation to the initiative

through land contribution allows togain a low profit of around € 288 kin 23 years.

M € = million EUR; k € = thousands EUR

Project “Ex Manifattura Tabacchi”, Scafati: Conclusions

30

This project is the most promising of the three pilot projects identified, thanks to a balanced mix of revenue-generating/no revenue-generating activities. However, some of the commercial activities foreseen (in particular the hostel and the private offices) may not findan adequate demand in Scafati. Even if conservative assumptions have been formulated to minimise overestimation of revenues, marketrisk has to be carefully taken into account while analysing economic and financial results.

In the baseline scenario a large amount of free grants (EUR 9 million of EU/regional and municipal funds) are assigned to the project forfinancing the part of the investment costs devoted to the realisation of infrastructures for the public services for which no profit isforeseen. The remaining part of the investment is expected to be financed by the private sector (private investors, financial institutions).Indicators of the baseline scenario appear not attractive for the private investors (large investment, low profit and late payback periodagainst the high market risk).

The injection of JESSICA funds in the project allows a reduction private capital needed (lower recourse to debt from financial institutions,reduction of equity contribution from the private investor) against an overall increase of the profitability of the project for the privateinvestor. Moreover, in all the three cases the Municipality saves almost EUR 3,2 million since no free grant from the municipality isrequired to make the project more attractive for the private sector and a shorter period of time is required for the recovery of the wholepublic investment (Structural and regional funds, JESSICA funds, funds from the Municipality).

The JESSICA loan scenario is considered the preferred one since it shows the best performance indicators (higher IRR and shorterpayback period) both for the private partner and for the Municipality. From the JESSICA perspective, profitability of the investment overthe lapse of time considered in the analysis is lower than for the other two scenarios but it is still acceptable (taking into account theoverall principle of generating socio-economic returns along with pure financial returns).


Conclusions

In the light of the previous results, the most performing scenarios were chosen for each project. They represent “Pilot projects” that have been usedfor the quantitative simulation of the functioning of the Urban Development Fund and of the Jessica Campania Holding Fund.

The results are summarised in the table below.

Project ScenarioJESSICA

PrivatePartner

MunicipalityFinancialinstitution

Public entities

IRR Payb. Funds IRR Payb. IRR Payb. IRR Payb. IRR Payb.

Parking andsquare inPortici

Equity +Loan

4,9% 15 0,78 16,3% 5 4,7% 14 4,1% 16 1,4 % 20

EducationalSite in Scafati

Equity 3,9% 4 2,05 n.a n.a n.a. n.a. 4,1% 4 n.a. n.a.

Ex ManifatturaTabacchi inScafati

Loan 1,0% 22 8,28 15,3% 9 5,9% 14 4,1% 17 n.a n.a

© 2010 PwC. All rights reserved. Not for further distribution without the permission of PwC. "PwC" refers to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL),or, as the context requires, individual member firms of the PwC network. Each member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does notprovide any services to clients. PwCIL is not responsible or liable for the acts or omissions of any of its member firms nor can it control the exercise of their professional judgment or bind them in anyway. No member firm is responsible or liable for the acts or omissions of any other member firm nor can it control the exercise of another member firm's professional judgment or bind anothermember firm or PwCIL in any way.


29 October 2010


Annex 2: Structure of JESSICA instruments inCampania Region

Annex 2: Structures of JESSICA instruments in Campania Region

pwc 2

1 Introduzione 3

2 Ipotesi di applicazione di JESSICA alle iniziative Più Europa ed Altre Città 4

3 Benefici per la Regione Campania e per i Comuni derivanti dalla partecipazione all’operazione7

Allegato 1: Analisi della possibilità di utilizzare gli strumenti JESSICA per l’implementazionedel Piano Casa nella Regione Campania.


pwc 3

Il presente documento ha l’obiettivo di descrivere in forma schematica e sintetica la proposta difunzionamento dello strumento JESSICA nel contesto regionale campano, al fine di fornire alResponsabile dell’Obiettivo Operativo 6.1. gli elementi necessari per valutare i benefici per la Regione eper i Comuni derivanti dall’operazione stessa.

Il documento risponde altresì alla richiesta della Regione Campania di verificare, seppur in via preliminare,la fattibilità amministrativa dell’utilizzo dello strumento JESSICA per l’implementazione del Piano Casa.L’allegato 1 riporta le risultanze di tale analisi.


pwc 4

La figura seguente riporta in maniera schematica l’ipotesi di funzionamento dello strumento JESSICAapplicato alle iniziative Più Europa ed Altre Città.



UDF (Banca)

HF Officer

Local HF Officer

Progetti

Privati

Regione

Comuni

Progetti PiùEuropa

ProgettiAltre Città

ComuniRegione +Comuni

Unità ResponsabileObiettivo Operativo

6.1. (URO)

Fondi Obiettivo 6.1.

Anno N: Capitale iniziale –Management Fee + Interessi

Capitale rischio

Dividendi

Fondo perduto

Fondo perduto

Cap

itale

rischio

+M

anag

em

ent

Fee

Cap

itale

+re

nd

imento

annuo

Cap

itale

rischio

/C

ap

itale

Deb

ito

Div

idend

i/C

ap

itale

+In

tere

ssi

1

1b

1c

3

2

4

BEI

FundingAgreement

Regione

1a


3a

pwc

JESSICACampaniaHolding Fund(HF)

1 L’

rischio di investimento.

pwc

JESSICACampaniaHolding Fund(HF)

L’obiettivo


JESSICACampaniaHolding Fund

obiettivo


JESSICACampaniaHolding Fund

obiettivo dell’HF può essere di conservare (ev. come obiettivo di minima) il capitale, tuttavia questo resta sempre soggetto a


Holding Fund

dell’HF può essere di conservare (ev. come obiettivo di minima) il capitale, tuttavia questo resta sempre soggetto a


Cosa è

Remunerazionedel HF

Strategia diInvestimento

Chiusura del HF

FundingAgreement

HF Officer




Cosa è

Remunerazionedel HF


Chiusura del HF

FundingAgreement

HF Officer




Cosa è

Remunerazionedel HF


Chiusura del HF

FundingAgreement

HF Officer



Cosa è

Remunerazione


Chiusura del HF

FundingAgreement

HF Officer



Remunerazione


Chiusura del HF

Agreement



Remunerazione

Chiusura del HF



HF è un fondo che gestisce, in nome e per conto della Regione Campania,parte dei fondi FESR Obiettivo Operativo 6.1., finanziando uno piùSviluppo Urbano (UDF).

L’Autorità di gestione riconosce al HF unaforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e sil’intero capitalerevolving

Il HF investe sulla base di una strategia di investimento definita,nei suoipunti essenziali, nelsuccessivo alla firma del Funding Agreement. La strategia dettagliata, leazioni che ne derivano sono sottomesse all’approvazione dell’Investment Boarddell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ UnitàResponsabile Ob

HF ha una durata stabilita in un numero di anni sufficienti a permettere unarotazione del capitale investito negli UDF. Alla chiusura del HF, la quota dicapitale apportata inizialmente dalla Regione Campania vienstessa (a meno dellamaturati).

HF si costituisce attraverso la finalizzazione delRegione Campania e la BEI.I passi per la definizione del

Il punto principale dell’accordo è la Strategia di Investimento.

HF Officerdefiniti nelOperational Guidelines

HF Investment BoardHF.I componenti delcriteri indicati nel







---



-

---

HF Investment BoardHF.I componenti delcriteri indicati nel







---



-

---

HF Investment Board

I componenti delcriteri indicati nel



L’Autorità di gestione riconosce al HF unaforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e sil’intero capitalerevolving stabilito nel RFS).




Studio di valutazione;Definizione della Strategia di Investimento;Firma del



Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational AgreementBandire e gestire la gara pubblica per la selezione degli UDF;Selezionare ilMonitorare l’implementazione degli

HF Investment Board



Annex 2


L’Autorità di gestione riconosce al HF unaforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e sil’intero capitale

stabilito nel RFS).


HF ha una durata stabilita in un numero di anni sufficienti a permettere unarotazione del capitale investito negli UDF. Alla chiusura del HF, la quota dicapitale apportata inizialmente dalla Regione Campania vienstessa (a meno della




è un rappresentante della BEI. Il suo ruolo e le funzioni sonodefiniti nel JESSICA Procedures ManualOperational Guidelines

Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational AgreementBandire e gestire la gara pubblica per la selezione degli UDF;Selezionare ilMonitorare l’implementazione degli

HF Investment Board



Annex 2


L’Autorità di gestione riconosce al HF unaforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e sil’intero capitale1 investito alla scadenza del

stabilito nel RFS).

Il HF investe sulla base di una strategia di investimento definita,nei suoipunti essenziali, nelsuccessivo alla firma del Funding Agreement. La strategia dettagliata, leazioni che ne derivano sono sottomesse all’approvazione dell’Investment Boarddell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ UnitàResponsabile Obiettivo Operativo 6.1..





è un rappresentante della BEI. Il suo ruolo e le funzioni sonoJESSICA Procedures Manual

Operational GuidelinesGestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational AgreementBandire e gestire la gara pubblica per la selezione degli UDF;Selezionare ilMonitorare l’implementazione degli

HF Investment Board

I componenti del Boardcriteri indicati nel Funding Agreement


Annex 2


L’Autorità di gestione riconosce al HF unaforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e si

investito alla scadenza delstabilito nel RFS).

Il HF investe sulla base di una strategia di investimento definita,nei suoipunti essenziali, nelsuccessivo alla firma del Funding Agreement. La strategia dettagliata, leazioni che ne derivano sono sottomesse all’approvazione dell’Investment Board che è l’organo di decisione e di controllo delledell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ Unità

iettivo Operativo 6.1..



Studio di valutazione;Definizione della Strategia di Investimento;Firma del Funding Agreement



Operational GuidelinesGestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational AgreementBandire e gestire la gara pubblica per la selezione degli UDF;Selezionare ilMonitorare l’implementazione degli

HF Investment Board

BoardFunding Agreement






Il HF investe sulla base di una strategia di investimento definita,nei suoipunti essenziali, nel Funding Agreementsuccessivo alla firma del Funding Agreement. La strategia dettagliata, leazioni che ne derivano sono sottomesse all’approvazione dell’

che è l’organo di decisione e di controllo delledell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ Unità


HF ha una durata stabilita in un numero di anni sufficienti a permettere unarotazione del capitale investito negli UDF. Alla chiusura del HF, la quota dicapitale apportata inizialmente dalla Regione Campania vienstessa (a meno della Management Fee


Studio di valutazione;Definizione della Strategia di Investimento;

Funding AgreementIl punto principale dell’accordo è la Strategia di Investimento.


Operational Guidelines. In particolare ha la responsabilità di:Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational AgreementBandire e gestire la gara pubblica per la selezione degli UDF;Selezionare il Local HF OfficerMonitorare l’implementazione degli

HF Investment Board è l’organo di decisione e controllo delle attività del

Board sono nominati dalla Regione Campania secondo iFunding Agreement


Structures of JESSICA instruments in Campania Region

HF è un fondo che gestisce, in nome e per conto della Regione Campania,parte dei fondi FESR Obiettivo Operativo 6.1., finanziando uno più



Il HF investe sulla base di una strategia di investimento definita,nei suoiFunding Agreement

successivo alla firma del Funding Agreement. La strategia dettagliata, leazioni che ne derivano sono sottomesse all’approvazione dell’



HF ha una durata stabilita in un numero di anni sufficienti a permettere unarotazione del capitale investito negli UDF. Alla chiusura del HF, la quota dicapitale apportata inizialmente dalla Regione Campania vien

Management Fee

HF si costituisce attraverso la finalizzazione delRegione Campania e la BEI.I passi per la definizione dell’Agreement sono:

Studio di valutazione;Definizione della Strategia di Investimento;



. In particolare ha la responsabilità di:Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational AgreementBandire e gestire la gara pubblica per la selezione degli UDF;

Local HF OfficerMonitorare l’implementazione degli

è l’organo di decisione e controllo delle attività del

sono nominati dalla Regione Campania secondo iFunding Agreement





investito alla scadenza del






Management Fee

HF si costituisce attraverso la finalizzazione delRegione Campania e la BEI.

l’Agreement sono:Studio di valutazione;Definizione della Strategia di Investimento;

















Management Fee

HF si costituisce attraverso la finalizzazione del

l’Agreement sono:

Definizione della Strategia di Investimento;Funding Agreement

















Management Fee


l’Agreement sono:

Definizione della Strategia di Investimento;Funding Agreement



. In particolare ha la responsabilità di:Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazionedell’Operational Agreement, ecc..);Bandire e gestire la gara pubblica per la selezione degli UDF;



sono nominati dalla Regione Campania secondo iFunding Agreement .











Management Fee, ma incrementata degli interessi


l’Agreement sono:

Definizione della Strategia di Investimento;Funding Agreement.



. In particolare ha la responsabilità di:Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazione

, ecc..);Bandire e gestire la gara pubblica per la selezione degli UDF;

Local HF Officer;Monitorare l’implementazione degli


sono nominati dalla Regione Campania secondo i.










, ma incrementata degli interessi


l’Agreement sono:

Definizione della Strategia di Investimento;




, ecc..);Bandire e gestire la gara pubblica per la selezione degli UDF;

Monitorare l’implementazione degli investimenti/progetti.


sono nominati dalla Regione Campania secondo i




L’Autorità di gestione riconosce al HF una Management Feeforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e si

investito alla scadenza del Funding Agreement

Il HF investe sulla base di una strategia di investimento definita,nei suoie dettagliata in un periodo






l’Agreement sono:



è un rappresentante della BEI. Il suo ruolo e le funzioni sonoe sintetizzati nelle


Bandire e gestire la gara pubblica per la selezione degli UDF;

investimenti/progetti.






Management Feeforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e si

Funding Agreement






HF si costituisce attraverso la finalizzazione del Funding Agreement












Management Feeforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e si

Funding Agreement






Funding Agreement











Management Feeforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HFgarantisce la gestione di tesoreria dei fondi versati e si impegna a restituire

Funding Agreement






Funding Agreement











Management Feeforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HF

impegna a restituireFunding Agreement




HF ha una durata stabilita in un numero di anni sufficienti a permettere unarotazione del capitale investito negli UDF. Alla chiusura del HF, la quota dicapitale apportata inizialmente dalla Regione Campania viene restituita alla


Funding Agreement











Management Fee secondo leforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HF

impegna a restituireFunding Agreement




HF ha una durata stabilita in un numero di anni sufficienti a permettere unarotazione del capitale investito negli UDF. Alla chiusura del HF, la quota di

e restituita alla, ma incrementata degli interessi

Funding Agreement


Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazione







HF è un fondo che gestisce, in nome e per conto della Regione Campania,parte dei fondi FESR Obiettivo Operativo 6.1., finanziando uno più Fondi di

secondo leforme stabilite dalla regolamentazione dei Fondi Strutturali (RFS). L’HF

impegna a restituireFunding Agreement (principio






Funding Agreement

è un rappresentante della BEI. Il suo ruolo e le funzioni sonoe sintetizzati nelle JESSICA

Gestione dell’HF su controllo dell’HF IB (definizione in detdella Strategia di Investimento, Selezione degli UDF, negoziazione






HF è un fondo che gestisce, in nome e per conto della Regione Campania,Fondi di


impegna a restituire(principio



che è l’organo di decisione e di controllo delle attivitàdell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ Unità



Funding Agreement tra la

è un rappresentante della BEI. Il suo ruolo e le funzioni sonoJESSICA

Gestione dell’HF su controllo dell’HF IB (definizione in dettagliodella Strategia di Investimento, Selezione degli UDF, negoziazione






5





successivo alla firma del Funding Agreement. La strategia dettagliata, leazioni che ne derivano sono sottomesse all’approvazione dell’HF

attivitàdell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ Unità



tra la


tagliodella Strategia di Investimento, Selezione degli UDF, negoziazione









successivo alla firma del Funding Agreement. La strategia dettagliata, leHF

attivitàdell’HF. La strategia contiene i criteri di selezione degli UDF e i criteri diselezione dei progetti nei quali gli UDF potranno investire. La “conferma diidoneità con gli obiettivi regionali” dei progetti è assicurata dall’ Unità



tra la


tagliodella Strategia di Investimento, Selezione degli UDF, negoziazione





pwc

LocalOfficer

Fondo diSviluppoUrbano (UDF)

UnitàResponsabileObiettivoOperativo 6.1.(URO)

pwc

LocalOfficer



Local HFOfficer



HF


ResponsabileObiettivoOperativo 6.1.

Urbano (UDF)

Responsabile

Operativo 6.1.

Cosa è

Cosa è

Processo diselezione

Remunerazionedel UDF


Cosa è

Il Ruolonell’ambito delprocesso diselezione deiprogetti

Cosa è

Cosa è




Cosa è


Cosa è

Cosa è




Cosa è


Cosa è





Processo di

Remunerazione


nell’ambito delprocesso diselezione dei

Remunerazione

nell’ambito del

selezione dei

Ildella gestione “ha la responsabilità di:

L’UDF (una banca o un pool di banche, che hanno anche la possibilità dicofinanziare i singoli progetti) implementa la strategia di investimento delHF, investendo, sotto forma di capitale di rischio o di debito, in progetti diriqualificazione urbana che fanno parte di Piani Integrati per lo SviluppoUrbano. Non esiste un limite nel numero di fondi utilizzabili nell’ambito dellostrumento JESSICA, maintervento su cui si intende investire (per semplicità operativa si consiglia diutilizzare UDF per tipologie omogenee di interventi, es. per localizzazione,per finalità) ed in base ad analisi di tipo eco

UDF è selezionato mediante gara pubblica bandita dal HF.

L’HF riconosce agli UDF unacapitale investito dal HF nel UDF). I progetti riconoscono al fondo ilripagamento del debito (quota capitale + interessi) e/o i dividendi.

Il rapporto tra un UDF e l’ HF è regolato dall’definisce anche il funzionamento del fondo.La strategia di investimento del UDF nei progetti di riqualificazione urbana èdefinita nell’AgreementL’cofinanziamento delle banche ai progetti.

L’URO è un comitato ristretto (3direttamente dal ResponsabileCampania.

L’URO ha il ruolo strategico di:

Il Local HF Officerdella gestione “ha la responsabilità di:

-

-

--




Il rapporto tra un UDF e l’ HF è regolato dall’definisce anche il funzionamento del fondo.La strategia di investimento del UDF nei progetti di riqualificazione urbana èdefinita nell’AgreementL’Operational Agrecofinanziamento delle banche ai progetti.


L’URO ha il ruolo strategico di:

Local HF Officerdella gestione “ha la responsabilità di:

-

-

--




Il rapporto tra un UDF e l’ HF è regolato dall’definisce anche il funzionamento del fondo.La strategia di investimento del UDF nei progetti di riqualificazione urbana èdefinita nell’Agreement

Operational Agrecofinanziamento delle banche ai progetti.


L’URO ha il ruolo strategico di:-

-

-


Analizzare la Strategia di Investimento e definire le lineel’analisi di fattibilità degli interventi;Preparare i documenti necessari per bandire la gara perselezionare gli UDF;Monitorare l’implementazione dei progetti;Implementare e gestire il sistema didegli UDF alla BEI ed alla Regione Campania.




Il rapporto tra un UDF e l’ HF è regolato dall’definisce anche il funzionamento del fondo.La strategia di investimento del UDF nei progetti di riqualificazione urbana èdefinita nell’Agreement



L’URO ha il ruolo strategico di:di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dalpunto di vista economicodi definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pebancabilità delle operazioni;di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.con il conten

Annex 2






Il rapporto tra un UDF e l’ HF è regolato dall’definisce anche il funzionamento del fondo.La strategia di investimento del UDF nei progetti di riqualificazione urbana èdefinita nell’Operational Agreement

del HF.Operational Agre

cofinanziamento delle banche ai progetti.

L’URO è un comitato ristretto (3direttamente dal Responsabile


Annex 2

Local HF Officerdella gestione “day to day”ha la responsabilità di:





Il rapporto tra un UDF e l’ HF è regolato dall’definisce anche il funzionamento del fondo.La strategia di investimento del UDF nei progetti di riqualificazione urbana è

Operational Agreementdel HF.




Annex 2

Local HF Officer è l’unità di collegamento tra HF e UDF, che si occupaday to day”

ha la responsabilità di:Analizzare la Strategia di Investimento e definire le lineel’analisi di fattibilità degli interventi;Preparare i documenti necessari per bandire la gara perselezionare gli UDF;Monitorare l’implementazione dei progetti;Implementare e gestire il sistema didegli UDF alla BEI ed alla Regione Campania.





Operational Agreementdel HF.

Operational Agreementcofinanziamento delle banche ai progetti.




è l’unità di collegamento tra HF e UDF, che si occupaday to day”

ha la responsabilità di:Analizzare la Strategia di Investimento e definire le lineel’analisi di fattibilità degli interventi;Preparare i documenti necessari per bandire la gara perselezionare gli UDF;Monitorare l’implementazione dei progetti;Implementare e gestire il sistema didegli UDF alla BEI ed alla Regione Campania.






ementcofinanziamento delle banche ai progetti.


L’URO ha il ruolo strategico di:di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dalpunto di vista economicodi definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pebancabilità delle operazioni;di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.con il contenuto del POR Campania, con i Più Europa ecc…).


è l’unità di collegamento tra HF e UDF, che si occupaday to day” del fondo. La struttura è nominata dalla BEI, ed


L’UDF (una banca o un pool di banche, che hanno anche la possibilità dicofinanziare i singoli progetti) implementa la strategia di investimento delHF, investendo, sotto forma di capitale di rischio o di debito, in progetti diriqualificazione urbana che fanno parte di Piani Integrati per lo SviluppoUrbano. Non esiste un limite nel numero di fondi utilizzabili nell’ambito dellostrumento JESSICA, ma il numero è definito sulla base delle tipologie diintervento su cui si intende investire (per semplicità operativa si consiglia diutilizzare UDF per tipologie omogenee di interventi, es. per localizzazione,per finalità) ed in base ad analisi di tipo eco





ement fissa anche i termini principali dell’eventualecofinanziamento delle banche ai progetti.


L’URO ha il ruolo strategico di:di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dalpunto di vista economicodi definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pebancabilità delle operazioni;di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.

uto del POR Campania, con i Più Europa ecc…).


è l’unità di collegamento tra HF e UDF, che si occupadel fondo. La struttura è nominata dalla BEI, ed


L’UDF (una banca o un pool di banche, che hanno anche la possibilità dicofinanziare i singoli progetti) implementa la strategia di investimento delHF, investendo, sotto forma di capitale di rischio o di debito, in progetti diriqualificazione urbana che fanno parte di Piani Integrati per lo SviluppoUrbano. Non esiste un limite nel numero di fondi utilizzabili nell’ambito dello

il numero è definito sulla base delle tipologie diintervento su cui si intende investire (per semplicità operativa si consiglia diutilizzare UDF per tipologie omogenee di interventi, es. per localizzazione,per finalità) ed in base ad analisi di tipo eco


L’HF riconosce agli UDF una Management Feecapitale investito dal HF nel UDF). I progetti riconoscono al fondo ilripagamento del debito (quota capitale + interessi) e/o i dividendi.



fissa anche i termini principali dell’eventualecofinanziamento delle banche ai progetti.


L’URO ha il ruolo strategico di:di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dalpunto di vista economicodi definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pebancabilità delle operazioni;di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.




Analizzare la Strategia di Investimento e definire le lineel’analisi di fattibilità degli interventi;Preparare i documenti necessari per bandire la gara per

Monitorare l’implementazione dei progetti;Implementare e gestire il sistema didegli UDF alla BEI ed alla Regione Campania.




Management Feecapitale investito dal HF nel UDF). I progetti riconoscono al fondo ilripagamento del debito (quota capitale + interessi) e/o i dividendi.




L’URO è un comitato ristretto (3-5 persone) formato da membri nominatidirettamente dal Responsabile Obiettivo Operativo 6.1. della Regione

di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dalpunto di vista economico-finanziario;di definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pebancabilità delle operazioni;di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.











Operational Agreement sulle base di criteri descritti nel


5 persone) formato da membri nominatiObiettivo Operativo 6.1. della Regione

di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dal

finanziario;di definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pebancabilità delle operazioni;di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.











sulle base di criteri descritti nel



di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione,Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dal

finanziario;di definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pe

di confermare ex ante (prima che il singolo progetto vengapresento/ proposto all’UDF per la verifica di fattibilità economicofinanziaria) la coerenza dei progetti con gli obiettivi regionali (es.







il numero è definito sulla base delle tipologie diintervento su cui si intende investire (per semplicità operativa si consiglia diutilizzare UDF per tipologie omogenee di interventi, es. per localizzazione,per finalità) ed in base ad analisi di tipo economico.




sulle base di criteri descritti nel

fissa anche i termini principali dell’eventuale


di sensibilizzare e promuovere verso i Comuni destinatari dei fondivolto a facilitare la presentazione, nell’ambito dei Piani Integrati diRiqualificazione Urbana (es. Più Europa), di progetti sostenibili dal

finanziario;di definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pe





Analizzare la Strategia di Investimento e definire le linee

Preparare i documenti necessari per bandire la gara per

Monitorare l’implementazione dei progetti;Implementare e gestire il sistema di Reportingdegli UDF alla BEI ed alla Regione Campania.


il numero è definito sulla base delle tipologie diintervento su cui si intende investire (per semplicità operativa si consiglia diutilizzare UDF per tipologie omogenee di interventi, es. per localizzazione,

nomico.



Il rapporto tra un UDF e l’ HF è regolato dall’Operational

La strategia di investimento del UDF nei progetti di riqualificazione urbana èsulle base di criteri descritti nel



di sensibilizzare e promuovere verso i Comuni destinatari dei fondinell’ambito dei Piani Integrati di

Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dalfinanziario;

di definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria pe







Monitorare l’implementazione dei progetti;Reporting

degli UDF alla BEI ed alla Regione Campania.



nomico.


(pari al massimo al 3% delcapitale investito dal HF nel UDF). I progetti riconoscono al fondo ilripagamento del debito (quota capitale + interessi) e/o i dividendi.

Operational





Riqualificazione Urbana (es. Più Europa), di progetti sostenibili dal








Reportingdegli UDF alla BEI ed alla Regione Campania.





Operational













Reporting degli investimenti





Operational













degli investimenti


















degli investimenti




Agreement






di definire l’ eventuale quota di contributo a fondo perduto (daparte della Regione o del Comune) necessaria per garantire la





Analizzare la Strategia di Investimento e definire le linee guida per


degli investimenti




Agreement

La strategia di investimento del UDF nei progetti di riqualificazione urbana èsulle base di criteri descritti nel Funding





di definire l’ eventuale quota di contributo a fondo perduto (dar garantire la





guida per


degli investimenti



(pari al massimo al 3% delcapitale investito dal HF nel UDF). I progetti riconoscono al fondo il

Agreement, che

La strategia di investimento del UDF nei progetti di riqualificazione urbana èFunding









6


guida per


degli investimenti




, che










guida per


degli investimenti




, che










pwc 7

Rispetto al tradizionale utilizzo dei fondi strutturali come finanziamento a fondo perduto dei progetti, il finanziamento

di progetti di riqualificazione urbana attraverso lo strumento di ingegneria finanziaria JESSICA presenta i seguenti

benefici per la Regione e per i Comuni coinvolti nell’operazione:

- Minimizzare il rischio di disimpegno automatico delle risorse.

Il conferimento dei fondi all’interno del HF costituisce pagamento intermedio (interim payment) delle risorse

nei confronti della EU, ed attiva il pagamento della quota di co-finanziamento comunitario. L’intero

ammontare dovrà tuttavia essere stato erogato dall’HF agli UDF, e gli UDF dovranno avere erogato i fondi

ricevuti dall’HF per progetti ammissibili (quindi tutta la dotazione di un UDF dovrà essere stata assegnata

con prestiti o partecipazioni azionarie destinati all’attuazione di progetti urbani ammissibili) entro la fine del

periodo di programmazione, cioè entro il dicembre del 2015. L’avvenuta erogazione dei fondi da parte degli

UDF andrà dimostrata in fase di certificazione finale (final payment) entro quella data.

- Mantenere la disponibilità dell’intera somma versata (meccanismo revolving).

Alla chiusura del HF (successiva al ripagamento del capitale investito da parte di tutti gli UDF) la somma

versata2

ritornerà nella disponibilità3

del bilancio Regionale. La Regione può decidere di riservare risorse ad

uso esclusivo dei Comuni che hanno partecipato all’operazione in quota proporzionale al valore dei progetti

finanziati dal HF tramite gli UDF. In tal modo la Regione stimola i Comuni a partecipare all’operazione con

un meccanismo di “premialità” dei Comuni più “meritevoli”.

- Usufruire della leva finanziaria (leverage).

Gli UDF saranno costituiti da una o più banche che avranno la possibilità di cofinanziare i progetti. Nella

gara di selezione degli UDF la BEI indicherà, come elemento di rilievo, l’apporto di capitale addizionale al

UDF da parte delle banche. Il rapporto debito/equity e il tasso di interesse del finanziamento avranno

caratteristiche competitive rispetto al mercato4.

Pertanto, i Comuni e la Regione potranno usufruire di una maggiore disponibilità per finanziare i progetti di

riqualificazione urbana, che si traduce, da un lato, nella possibilità di realizzare un numero maggiore di

interventi, dall’altro nell’opportunità di liberare risorse regionali/comunali.

- Alleggerimento dell’attività di certificazione delle spese verso UE.

Il ricorso agli strumenti di ingegneria finanziaria JESSICA trasforma la natura di “contributo a fondo perduto”

dei fondi strutturali in finanziamento con necessità di remunerazione del capitale. Il compito della

rendicontazione degli investimenti degli UDF viene assunto dal gestore del Fondo di Partecipazione, che

attraverso l’ Operational Agreement obbliga gli UDF a rendicontare gli investimenti in progetti ammissibili al

finanziamento a valere sui Fondi Strutturali.

Pertanto, gli UDF verificano le spese sostenute nell’ambito dei progetti (attraverso i medesimi controlli

effettuati dalla Regione in sede di certificazione delle spese) e ne inviano la rendicontazione, in forma

sintetica, al HF ed alla Regione.

2Alla Regione Campania sarà riconosciuta una somma pari al capitale versato all’inizio dell’operazione, diminuito della

Management Fee del HF ed aumentato degli interessi maturati.3

Al termine della prima “tornata” (primo ciclo di rotazione dei fondi) i fondi che rientrano nella disponibilità della Regione possono

essere utilizzati da questa per “progetti urbani”. Questo vincolo di destinazione scompare per i cicli successivi al primo nel caso in

cui la Regione decida di continuare ad utilizzare tali fondi in modo rotativo.4

A titolo di esempio si evidenzia che per progetti in contesto analogo sono stati offerti finanziamenti per un rapporto Debito/Equity

tra il 50% e l’80% ad un tasso di interesse annuale fisso di circa il 3% per una durata pari a 20 anni.


pwc 8

Mediante questo meccanismo la Regione, responsabile della certificazione delle spese sostenute verso la

Commissione Europea, delega di fatto le attività di verifica all’UDF.

In qualità di responsabile dei controlli e della certificazione delle spese la Regione invia la documentazione

alla Commissione.

- Usufruire del supporto degli UDF.

I Comuni ed i soggetti promotori dei progetti possono avvalersi del supporto tecnico del UDF per la

preparazione della documentazione richiesta in sede di iter istruttorio delle iniziative.


pwc

Di seguito si riportano le risultanze dell’analisi preliminare:

1. In sostanza, il DPCM del 16 luglio del 2009 - il c.d. Piano Casa (il "Piano") - prevede la firma diaccordi di programma fra il Ministero Infrastrutture e Trasporti (il “MIT”), le Regioni ed i Comuniper la condivisione ed attuazione dello stesso.

2. L'art. 11 del DPCM prevede un sistema integrato di fondi immobiliari, attraverso la partecipazionead uno, o più fondi immobiliari chiusi, tramite l'utilizzo di risorse a valere sul fondo previsto dal DL112/2008, convertito in L 133/2008. Si tratta di un fondo nello stato di previsione del MIT.

3. I fondi di cui al DPCM saranno dedicati allo sviluppo di una rete di fondi, o altri strumentifinanziari, che contribuiscano ad incrementare la dotazione di alloggi sociali. L'art. 11 dello stessoDPCM, al comma 3, prevede l'istituzione di un apposito gruppo di lavoro, incaricato di indicare irequisiti che i fondi devono possedere, sulla base dei criteri individuati al comma 4 dello stessoarticolo.

4. Il gruppo di lavoro non ha ancora concluso la sua analisi, quantunque, in un comunicato stampadel Ministro Matteoli del 14 dicembre u.s., si legga che, a quella data, i lavori del gruppo di lavoroerano in "avanzato stato". Peraltro, ciò voleva anche dire che il regolamento che detta lecaratteristiche che i fondi devono avere non è ancora stato emanato. Senza questo regolamento,non esiste un'interpretazione autentica del comma 4, lettera f.11) dell'articolo 11 del DPCM - chesi riferisce ai fondi strutturali -, né sono assolutamente chiari i criteri relativi all'intersecazione deifondi nazionali e comunitari.

5. In linea generale, si può dire che, fra gli elementi di cui tenere conto al fine di determinare i criteridi partecipazione agli investimenti locali - acquisendo partecipazioni di minoranza fino a un limitemassimo del 40% - vi è quello che riguarda "l'eventuale apporto di contributi pubblici o privati, adesempio attivati a amministrazioni locali, dallo Stato o dall'Unione europea compresi quelli di cuiall'art. 44 del regolamento (CE) n. 1083/2006 del Consiglio dell'11 luglio 2006 sui fondi strutturalie quelli in cui può intervenire il Fondo Europeo per gli Investimenti" (Articolo 11, comma 4, letteraf.11) del DPCM). Questa previsione ha evidente carattere programmatico, in quanto è destinataad orientare il gruppo di lavoro nello svolgimento del compito assegnatogli.

6. Non è dato prevedere, allo stato, in che modo il gruppo configurerà la rilevanza dell'elemento"eventuale apporto di contributi pubblici o privati, ad esempio attivati a amministrazioni locali,dallo Stato o dall'Unione europea compresi quelli di cui all'art. 44 del regolamento (CE) n.1083/2006 del Consiglio dell'11 luglio 2006 sui fondi strutturali e quelli in cui può intervenire ilFondo Europeo per gli Investimenti" all'interno del sistema integrato dei fondi immobiliari.

7. Il citato articolo del DPCM parla di "eventuale apporto", lasciando intendere che potrà essereprevista la possibilità che i fondi preconizzati dal DPCM siano alimentati anche da risorseJESSICA, o, comunque, riconducibili ai fondi strutturali. Da questo assunto sembra si debbadedurre che sarà il gruppo di lavoro ad identificare i criteri di ripartizione e/o compatibilità tra lerisorse nazionali e quelle di derivazione comunitaria, seppure in una logica di ricorso meramenteaddizionale, o residuale, di quest'ultime.


pwc

8. Peraltro, vale notare che i progetti sovvenzionabili mediante ricorso a strumenti di tipo JESSICAin linea di principio non coincidono - o coincidono soltanto marginalmente - con l'alveo diapplicazione del DPCM. Inoltre, una volta che il gruppo di lavoro abbia identificato i criteri per laripartizione dei fondi, ai sensi dell'articolo 11, comma 7 del DPCM, il MIT deve emanare unproprio decreto per divulgarli e renderli esecutivi.

Sul piano pratico, per consentire agli UDF di essere partecipati dai fondi previsti dal DPCM, questaeventualità deve essere esplicitata nel bando per la selezione degli UDF stessi.

Si ritiene che, nell’ambito dell’operazione JESSICA, dovrà essere costituito un UDF specifico dautilizzare, almeno in parte, per l’attuazione del Piano Casa per i seguenti motivi:

- verosimilmente il primo UDF JESSICA della Regione Campania sarà preesistente ai fondi previstidal DPCM, pertanto, non sarà nota al momento della costituzione, l’entità dei fondi adisposizione. La natura di fondo chiuso descritta nel DPCM esclude la possibilità di successivifinanziamenti del fondo;

- il fondo da utilizzare, ai fini del DPCM, dovrà essere esclusivamente di natura immobiliare.

Peraltro, in mancanza del regolamento di attuazione del DPCM – che sarà l’unico strumento che detteràprecise istruzioni sulla realizzazione dei fondi chiusi previsti dal Piano Casa – si suggerisce di nonprecludersi alcun alternativa che dovesse rendersi disponibile nel tempo. A tal fine, la documentazioneper la gara per la selezione degli UDF stessi dovrebbe consentire la possibilità di un coordinamento –quantunque futuro – tra i due strumenti, ossia la possibilità che il fondo chiuso previsto dal DPCM possariversarsi nell’UDF, quando costituito, in un secondo momento.



29 October 2010


Annex 3: Investment Strategy and Planning(Appendix A Funding Agreement)

Annex 3: Investment Strategy and Planning

pwc 2

Index

1. Context 3

1.1. PIU Europa Initiative. 4

1.2. “Altre Città” Initiative 5

2. Investment Strategy 6

2.1. Investments selection criteria 6

2.2. The role of the ROO. 6

2.3. Investment Products 7

2.4. Maximum and minimum percentages planned to be held, investment limits. 7

3. Planning 8


3

pwc

The Campania OP allocated EUR 775 million in support of urban regeneration and quality of life projectsin medium-sized cities under Operational Objective 6.1.

The Managing Authority wants to employ part of these financial resources through the FinancialEngineering instruments supported by the JESSICA initiative. To this end, the Managing Authority willcontribute with an initial amount of EUR 100 million into the JESSICA Holding Fund. The JESSICAHolding Fund will invest in a UDF in order to contribute to the implementation of two initiatives put in placeby the Campania Region within the scope of Operational Objective 6.1, namely

the “PIU Europa” initiative, aimed at urban regeneration in 19 medium-sized cities, identifiedwith DGR

1n. 282/08;

the “Altre Città” initiative, aimed at urban regeneration in 22 medium-sized cities (not includedin the 19 from “PIU Europa”), identified with DGR n. 1026\2009.

If deemed appropriate, the Managing Authority will further contribute to the JESSICA Holding Fund bybringing in additional funds available under Operational Objective 6.1, or from other sources, such asFAS

2under the urban sustainable development priority, and those supporting schemes launched under

the Piano Casa. The definition and implementation of projects will pay particular attention to theintegration between renovation/recovery of existing buildings and new construction, as well as support toassisted and subsidised housing, including new types of social housing, self-recovery and self-construction.

This initiative is promoted by the ROO in order to:

take advantage of the revolving nature of financial engineering instruments established throughJESSICA. The use of financial engineering instruments enables the Managing Authority to createa tool that will “re-constitute” the financial resources dedicated to urban regeneration projects.Once returned, these resources will represent an independent supply of funding, additional toother potential resources made available in future planning periods;

promote the development and implementation of long-term urban investment. Aware of theimportance of developing and supporting urban projects achieving economic and financial returnsalong with those with purely socio-environmental gains, the Managing Authority seeks toencourage Local Administrations to plan investments assuring long-term economic, social andenvironmental benefits, and simultaneously capable to be financially self-sustainable;

develop the capacity of public entities to plan and promote the use of participative design andplanning methodologies. The use of JESSICA financial engineering is dedicated specifically toinitiatives included in Integrated Plans for Sustainable Urban Development. As of today, theCampania municipalities have undertaken a process of integrated urban planning based on acontinuous public-private dialogue, taking into account the private parties’ interest in beingawarded grants and/or obtaining land use changes. In this context, the Managing Authority aimsat triggering a virtuous process stimulating Local Administrations to plan with a longer-termperspective, and promoting systematic participation of stakeholders during the whole process,from the identification of territorial priorities, to elaborating development guidelines, drafting urbanplans, and defining the technical, economic and financial characteristics of projects. Theintroduction of innovative financial instruments supporting or substituting grants is crucial to movetowards a system leading to long-lasting benefits;

1 Deliberazione della Giunta Regionale (Regional Committee Deliberation).2

Fondo per le Aree Sottoutilizzate (Fund for Underused Areas).

1. Context


4

pwc

attract private financing into urban regeneration projects. By creating a financial instrumentdedicated to finance public-private urban regeneration projects, including environmentallysustainable buildings and initiatives connected with social housing, and facilitating access tocredit at competitive rates, the Managing Authority intends to attract private capital into urbanregeneration. Selected initiatives can be supported jointly by UDF resources and public subsidiesfrom other sources. Along these lines, a “Credit and Guarantee Revolving Fund” is already inoperation to assist urban investment projects, specifically in favour of multi-annual programmesof assisted housing

3;

bring into JESSICA financial engineering instruments resources from the ImplementationProgramme of FAS, Piano Casa, Renewable Energy, as well as social housing, infrastructure, etc.to support initiatives complementary to those envisaged under Operational Objective 6.1.

1.1. PIU Europa Initiative.

The PIU Europa Initiative supports the creation of sustainable urban regeneration interventions includedin the Integrated Urban Plans (PIU Europa) of 19 medium-sized cities.

Through DGR n. 282/08, the Campania Region:

has identified the 19 cities object of intervention based on the demographic dimension, and thelevels of residential and socio-economic deprivation;

has defined criteria to assign the resources of Operational Objective 6.1 to the cities;

has approved the general scheme for the Programme Agreement (Accordo di Programma)providing the framework to implement the planning process for PIU Europa.

The initiative is based on an approach that integrates different categories of intervention within thebroader scope of an organic urban regeneration programme.

Hence, PIU Europa represents a coordinated collection of urban projects aimed at strengthening theattractiveness and competitiveness of Campania cities under a sustainable socio-economic revitalisationperspective closely aligned with the guidelines set by the Regional Territorial Plan (PTR).

The Integrated Plans are developed by the cities on the basis of a continuous dialogue with the ROO.The process kick-offs with the stipulation of a Memorandum of Understanding between the Region andthe medium sized city, as well as other possible key parties, followed by the setting up of a “control room”overlooking the local partnership process and by the creation of a technical-administrative work team.

Each medium-sized city, through a participative planning process involving major stakeholders, definesthe PIU Europa Programme, which constitutes the operating framework – including the identification andintermediate design of candidate projects - to give concrete application to the City Strategy DevelopmentGuidelines (DOS)

4. The coherence with territorial priorities and guidelines is checked by the ROO and the

NVVIP5

via ex ante and in itinere evaluations.

The documents presented by the city authorities undergo a process of verification and evaluationconsisting of three progressive and interlinked phases. Each phase has a specific content, and implies ajudgment on the quality and contents of the documents.

3As provided in Regional Law n.1 of 30/01/2008, BURC n. 5 bis of 4/02/2008, disciplined by DGR n. 231 of 06/02/2008 “Linee

Guida per la Programmazione in materia di Edilizia Residenziale Pubblica e fondi fitto”, as foreseen in Law 431/98.4

City Strategy Development Guidelines (DOS - Documento di Orientamento Strategico) is a comprehensive document that

identifies priorities and sets general urban development guidelines. The contents of the document are coherent and aligned with

guidelines set by the PTR.5

Projects Evaluation and Verification Committee.


5

pwc

The ROO carries out the first two phases, relating respectively to the technical analysis of the proposedinterventions and to the analysis of the regulatory, organisational and procedural aspects. A third phase isperformed by the NVVIP as part of the ex ante evaluation in parallel to phases one and two. The NVVIPanalysis takes place at a comprehensive urban level and aims at evaluating the Integrated Plan within awider context encompassing the urban projects under PIU and DOS.

Such an approach emphasises the role and involvement of the regional administration in order to bringabout a successful outcome of the PIU process and facilitate a quick start of the initiatives, undercontinuous observation and control by the ROO.

The definition of the PIU Europa is followed by the stipulation of a Programme Agreement (Accordo diProgramma) between the Region and the delegated City.

As of today, the process is at advanced completion status.

1.2. “Altre Città” Initiative

DGR n. 1026\2009 identifies the 22 medium sized cities from the Campania under the “Altre Città”

initiative. Criteria applied are those used for the identification of cities within the PIU Europa initiative.

Through public notice/s, as described in Section 2.2, cities will be invited to develop projects aligned both

with criteria of the Operational Objective 6.1. and with those defined in the framework of JESSICA.


6

pwc

2. Investment Strategy

2.1. Investments selection criteria

The objective of the JESSICA Holding Fund is to manage the financial resources brought in by theManaging Authority by investing them in a UDF with the objective of promoting urban sustainabledevelopment.

Subject to further due diligence of the relevant national rules, the UDF may be established under one ofthe following forms:

Joint stock company;

PPP (Public Private Partnership);

Investments fund;

Bank;

Other financial institution.

The JESSICA Holding Fund may only make investments or commit for investment to support projectsfulfilling the following criteria:

they are included in one of the two initiatives described in Section 1. In line with the goals ofthe two initiatives, the admissible operations will hence have the following general ends:

- environmental recovery, social and economic regeneration;

- renewal, regeneration and valorisation of “waterfronts”;

- renewal, regeneration and valorisation of under-used or unused urban spaces to createurban parks, natural commercial centres, artisan labs, expo areas, and social aggregationareas;

- improvement of local mobility systems;

- safety and security;


have received from the ROO a verification on their compliance with criteria specified withinOperational Objective 6.1. (see Section 2.2).

2.2. The role of the ROO.

The ROO will ensure the strategic coherence of JESSICA actions with regional planning objectives,enabling the EIB to operate within the limits of its mandate, and, at the same time, will support the cities inelaborating projects in line with the principles described in Section 2.1. In particular, the ROO:

will actively participate with the EIB in the elaboration of the proposals for modification of theInvestment Strategy and Planning to be presented for approval by the EIB to the InvestmentBoard, thus ensuring coherence with the principles of Operative Objective 6.1;

will actively participate with the EIB in the elaboration of the detailed programme of activities to bepresented for approval to the Investment Board, in order to ensure connection between theJessica Actions and the activities performed by the Campania Region within the scope ofOperational Objective 6.1.;

will stimulate cities to elaborate projects aligned with the characteristics presented in Section 2.1,as follows :


7

pwc

- PIU Europa Initiative: through the process described in Section 1.1, the ROO willsupport the cities in including such projects within the scope of PIU Europa;

- Altre Città Initiative: through public notice/s, the ROO will inform the cities about theJESSICA financial instrument activation and will notify the modalities to accede suchinstrument. In particular, it will stimulate the 22 cities to present projects having thecharacteristics described in Chapter 2.1. Following the presentation, the ROO will verifythe coherence of projects submitted with the Operational Objective 6.1. criteria;

will verify the coherence of projects with the Operational Objective 6.1 criteria, as described inSection 2.1.;

will promote integration between JESSICA instruments and other synergic actions (e.g. RevolvingFund for credit and security, priority actions of Scheme 8 of the FAS Implementation Plan, PianoCASA, ordinary funds, etc…) in order to pursue urban regeneration objectives.

2.3. Investment Products

The resources contributed by JESSICA HF can be invested by the UDF through:

equity instruments;

loans.

2.4. Maximum and minimum percentages planned to be held, investment limits.

1. Limits for the number of Operations: there are no maximum or minimum limits for the number ofOperations;

2. Limit for the geographic area: as described in Chapter 2.1, the JESSICA HF will invest inOperations localised in the 19 medium-sized cities identified by DRG n. 282/08, and in the 22medium-sized cities identified by DRG n. 1026\2009;

3. Limits for diversification: the JESSICA HF is not subject to any diversification limit. Therefore, theJESSICA HF could in principle invest in only one Operation;

4. Percentage of Stake, in case of equity investments: there shall be no maximum or minimum limitsfor the holdings in Operations.


8

pwc

3. PlanningThe strategy presented in Chapter 2 will be implemented on the basis of a detailed programme ofactivities to be elaborated in close cooperation between the EIB and ROO and submitted for approval bythe EIB to the Investment Board.

Modifications to the detailed programme will be elaborated in close cooperation between the EIB andROO and submitted for approval by the EIB to the Investment Board.

1

PricewaterhouseCoopers Advisory



29 October 2010


Annex 4: Application Form Altre Città

1

POR FESR CAMPANIA 2007/2013 OBIETTIVO OPERATIVO 6.1

Allegato B Scheda di Sintesi della proposta

Comune di ………………………..

Nome identificativo dell’intervento________________________________ (il titolo attribuito deve identificare univocamente l’opera e deve corrispondere alla denominazione del progetto)

Proponente _________________________________________________

Legale rappresentante del Proponente ________________________________

Firma leggibile

2

Sezione I Identificazione e caratteristiche dell’intervento

1. Nome identificativo dell’intervento: ____________________________________ 2. Proponente Ente Indirizzo (Civico, CAP, Località)

Telefono

Fax

e-mail

Funzionario di riferimento

3. Tipologia dell’intervento

Intervento completo Lotto funzionale (specificare a

lato) Ampliamento intervento già

esistente

Completamento intervento già esistente

Lotto intermedio - funzionale

4. Descrizione dell’intervento

Max 4000 caratteri

3

5. Dati dimensionali dell’intervento (Tabella di sintesi)

ESISTENTE1 DI PROGETTO

Superficie territoriale (mq)

Superficie fondiaria (mq)

Volume costruito (mc)

Volume da realizzare (mc)

Superficie coperta (mq)

Opere di urbanizzazione primaria (mq)

Opere di urbanizzazione secondaria (mq)

Destinazioni d’uso:

• Commerciale (mq)

• Terziario (mq)

• Residenza (mq)

• Attrezzature pubbliche (mq)

• Riserva aree da DM 1444/68 (mq)

• _______________________ (mq)

6.Relazione spazio-funzionale dell’intervento con attrezzature e servizi di interesse collettivo Indicare, nella tabella che segue, la distanza delle attrezzature e dei servizi di interesse collettivo dall’intervento proposto

Distanza (m) Attrezzatura/servizi di interesse collettivo

Scuole

Uffici postali

Banche

Chiese

Aree sportive

Corridoio ecologico (percorsi a verde, giardini pubblici, parchi urbani)

Scavi archeologici

Altro (specificare)

7. Costo dell’intervento

Il costo dell’intervento si intende omnicomprensivo, includendo costo di costruzione, spese tecniche2, somme a disposizione, , espropri, IVA etc. Se applicabile, suddividere il costo per tipo di opera prevista (es. parcheggio, centro commerciale, impianto fotovoltaico, ecc…)

Descrizione Costo totale (€)

Opera 1

Opera 2

Opera n

Costo totale dell’intervento

1 Solo nel caso di lotti funzionali e ampliamento/completamento 2 Costi ingegneria, consulenze e autorizzazioni

4

8. Stato della progettazione In caso di risposta affermativa, indicare la data di approvazione; altrimenti indicare la data di approvazione prevista

Stato Disponibilità (SI/NO)

Data di approvazione

Progetto preliminare

Progetto definitivo

Progetto esecutivo

5

Sezione II Aspetti di carattere urbanistico, normativo ed ambientale

9. Conformità agli strumenti urbanistici e di programmazione Strumenti urbanistici sovracomunali

Coerenza Strumento

SI NO

Piano Territoriale Regionale Piano territoriale di Coordinamento Provinciale Piano Urbanistico Territoriale Altro Strumenti urbanistici generali

Coerenza Strumento

SI NO

Programma di fabbricazione Piano Regolatore generale e Regolamento urbanistico edilizio comunale

Piano Urbanistico Comunale Strumenti attuativi

Coerenza Strumento

SI NO

Piano urbanistico attuativo Piano di Zonizzazione Piano di Recupero Altro

In caso di non conformità, specificare i provvedimenti che si intende adottare e il percorso amministrativo in base alla LUR Campania n. 16/2004 ________________________________________ Qualora necessario, specificare se all’emissione del decreto di esproprio si ritiene che i vincoli ad esso preordinati siano ancora vigenti. In caso negativo, specificare i provvedimenti che si intende adottare ________________________________________

10. Congruenza con la programmazione delle OO.PP. in vigore L’infrastruttura è inserita nel programma triennale delle opere pubbliche ai sensi del DLgs 12 aprile 2006,

n.163 e ss.mm.ii. (il “Codice Appalti”). L’infrastruttura è inserita nell’elenco annuale delle opere pubbliche ai sensi del Codice Appalti.

6

11. Quadro dei vincoli L’intervento ricade in zona soggetta a vincolo idrogeologico L’intervento ricade in zona soggetta a rischio idraulico L’intervento ricade in zona soggetta a rischio frana L’intervento ricade in zona soggetta a vincolo paesistico L’intervento ricade in zona soggetta a vincolo archeologico L’intervento ricade in zona soggetta a vincolo sismico L’intervento ricade in zona di rispetto ferroviario L’intervento ricade in zona di rispetto autostradale L’intervento ricade in zona di rispetto stradale L’intervento ricade in zona soggetta a servitù militari L’intervento ricade in zona soggetta ad altri vincoli ostativi alla sua realizzazione

Specificare vincolo/i

12. Appaltabilità Il progetto si intende immediatamente appaltabile quando è provvisto della validazione necessaria per indire la gara d’appalto ex Codice Appalti; in caso di infrastruttura immateriale si intende per immediatamente appaltabile qualora sia già stato approvato il disciplinare tecnico ovvero il capitolato d’oneri, ove la stessa non rientri nell’alveo d’applicazione del Codice Appalti.

SI NO Il progetto è immediatamente appaltabile

se NO, indicare tempi e modalità per avvenire all’appaltabilità

se SI specificare il tipo di appalto:

a.Appalto concorso (con progetto preliminare)

b.Appalto integrato (con progetto definitivo)

c.Appalto (con progetto esecutivo)

d.Concessione lavori o di servizi

e.Locazione finanziaria

f.Affidamento lavori o servizi mediante finanza di progetto

g.Società mista

h.Altre tipologie di partenariato pubblico-privato così come definito all’art. 3, comma 15ter del Codice Appalti.

Nei casi da d ad h descrivere iter amministrativo previsto/in corso/espletato

7

13. Quadro riassuntivo degli atti amministrativi Specificare, utilizzando la tabella seguente, quali sono gli atti amministrativi necessari per l’appaltabilità dell’opera, indicando il soggetto competente per l’emanazione e la disponibilità o meno di tali atti; specificare non solo gli atti interni dell’Amministrazione beneficiaria, ma anche quelli da acquisire presso Enti esterni e presso la Regione Campania.

Tipo di atto Soggetto competente Emanato SI/NO

Eventuali tempi previsti per l’emanazione

14. Conformità con le norme di carattere ambientale L’intervento è soggetto a V. I. A. nazionale L’intervento è soggetto a V. I. A. regionale L’intervento ha ricadute su un Sito di Interesse Comunitario (SIC), e/o una Zona di Protezione Speciale (ZPS.) e/o una riserva naturale

Specificare quali

L’intervento è soggetto a “rischio di incidente rilevante”

15. Criticità ambientali connesse all’intervento (indicare, in termini qualitativi e quantitativi, i principali problemi ambientali connessi alla realizzazione dell’infrastruttura. Evidenziare gli elementi inquinanti prodotti dall’intervento, in fase di cantiere e di esercizio) Max 4000 caratteri

8

Sezione III Quadro Strategico 16. Quadro Strategico e Programmatico di intervento Descrivere la strategia di riqualificazione – rigenerazione – sviluppo urbano nella quale il progetto è inserito.

Max 4000 caratteri

17. Analisi territoriale volta ad individuare gli squilibri territoriali nelle aree oggetto di

intervento Descrivere l’inquadramento territoriale dell’intervento, la situazione di disagio ambientale o sociale, gli elementi socio-economici di contesto Max 4000 caratteri

18. Coerenza dell’intervento con le azioni e l’ambito strategico dell’Obiettivo Operativo 6.1

Max 4000 caratteri

19. Ambito di impatto strategico sulle priorità dell’obiettivo operativo 6.1.

- Riqualificazione ambientale

- Rigenerazione economica e sociale

- Riqualificazione e valorizzazione dei “waterfront”

- Riorganizzazione e valorizzazione degli spazi urbani

- Potenziamento di sistemi di mobilità locale

- Diffusione della legalità e la sicurezza

- Diminuzione della disoccupazione

- Sviluppo economico

- Rafforzamento del sistema produttivo

9

20. Interazione dell’intervento con altri programmi e strumenti

Max 4000 caratteri

21. Rispondenza dell’intervento ai criteri di sostenibilità ambientale Occorre spuntare il campo dei criteri laddove rilevanti Rilevante

Riduzione al minimo dell’impiego delle risorse energetiche non rinnovabili Utilizzo delle risorse rinnovabili nei limiti della capacità di rigenerazione Uso e gestione corretta, dal punto di vista ambientale, delle sostanze e dei rifiuti pericolosi/inquinanti

Conservazione e miglioramento dello stato della fauna e della flora selvatiche, degli habitat e dei paesaggi

Conservazione e miglioramento della qualità dei suoli e delle risorse idriche Miglioramento della qualità delle risorse storiche e culturali Miglioramento della qualità dell’ambiente locale Contributo alla protezione dell’atmosfera Sensibilizzazione alle problematiche ambientali e sviluppo dell’istruzione e della formazione in campo ambientale

Promozione della partecipazione del pubblico alle decisioni legate a strategie sostenibili

22. Capacità di contenimento dei consumi energetici Valgano come riferimento le soglie imposte dal d.lgs. 192/2005, come modificato dal d.lgs. 311/2006. Abbattimento del consumo

idrico pro-capite

Abbattimento delle emissioni di CO2

Reimpiego di materiale edile da demolizione

Miglioramento delle condizioni igrometriche del comparto urbano e governo del microclima mediante

sistemi passivi (ventilazione, raffrescamento,

ombreggiature/barriere stagionali)

23. Impatti attesi Descrivere, partendo dai valori attuali, gli impatti positivi attesi dalla realizzazione dell’intervento, con riferimento all’ambito di impatto strategico di cui al punto 19 precedente. (es. livello di sicurezza, accessibilità, efficienza energetica, ecc…) Max 4000 caratteri

10

24. Caratteristiche rilevanti per l’ammissibilità all’iniziativa JESSICA

Promozione della competitività e dell’innovazione, miglioramento della qualità della vita nelle città e

nelle reti urbane Rilevanza degli interventi di pubblica utilità e capacità di impattare positivamente sulle

caratteristiche ambientali a socio-economiche del tessuto urbano Sostenibilità finanziaria che attesti la capacità del progetto di remunerare il capitale investito

(condizione necessaria) dimostrata tramite: − se disponibile, Business Plan; e Piano Economico e Finanziario dell’operazione allegati alla

domanda e − compilazione Sezione IV Caratteristiche Economico Finanziarie del progetto

11

Sezione IV Caratteristiche Economico Finanziarie del progetto

25.Stima delle fonti di copertura dell’investimento (€) Fonti di copertura Ammontare (€)

Mezzi propri

Capitale privato/altre fonti

Contributi pubblici

Altri finanziamenti a rimborso

Risorse JESSICA (indicativo)

Totale fonti di copertura (€)

26.Distribuzione temporale dell’’investimento Indicare la distribuzione temporale dell’investimento totale e, se applicabile, di ciascuna tipologia di opera di cui l’intervento si compone (confrontare il punto 7 della Sezione I della presente scheda)

Anno 1 Anno 2 Anno 3 Anno 4 Anno 5 Anno 6

Costo totale intervento

Importo lavori

Spese tecniche

Espropri

IVA

Altri costi

Opera 1

Importo lavori

Spese tecniche

Espropri

IVA

Altri costi

Opera 2

Importo lavori

Spese tecniche

Espropri

IVA

Altri costi

Opera n.

Importo lavori

Spese tecniche

Espropri

IVA

Altri costi

12

27.Descrizione del modello di gestione prescelto

(Se applicabile, indicare i soggetti privati 3 che hanno manifestato interesse a partecipare all’iniziativa ed il tipo di

coinvolgimento proposto – es. impresa di costruzione per partecipazione al capitale e realizzazione opere, gestore hotel per partecipazione al capitale e gestione attività, ecc…) Max 4000 caratteri

28. Analisi della domanda e dell’offerta attuale e futura di servizi similari a quelli previsti

nell’ambito del progetto L’analisi è finalizzata a giustificare le scelte progettuali ed a supportare le modalità previste per la remunerazione del capitale. In particolare l’analisi sarà articolata in analisi della domanda, analisi dell’offerta e conclusioni. I principali contenuti delle analisi sono descritti di seguito. Analisi della domanda L’analisi si pone l’obiettivo di individuare il bacino potenziale di clienti (finali- es. acquirenti; intermedi- es. locatari, gestori) 1.Individuazione del bacino di riferimento Il bacino di riferimento è l’area rispetto alla quale deve essere elaborata l’analisi. L’area coincidente con l’area di influenza dell’opera, dovrà essere identificata sulla base di criteri di accessibilità all’opera da realizzare ed alla possibilità di potenziali utenti di utilizzare servizi similari all’interno dell’area in modo alternativo.

Max 4000 caratteri

2.Descrizione delle caratteristiche del bacino di riferimento La descrizione comprenderà l’analisi del sistema infrastrutturale, delle caratteristiche socio-demografiche, dei servizi pubblici, dell’attrattività turistica, dei flussi di transito, ecc… caratterizzanti il bacino di riferimento

Max 4000 caratteri

3 Indicare la tipologia di soggetto privato

13

3.Analisi di mercato Descrizione dell’evoluzione temporale del mercato relativo a ciascuno dei servizi che si propone di offrire con la realizzazione del progetto a livello regionale, comunale e nel bacino di riferimento.

Max 4000 caratteri

4.Descrizione della propensione all’utilizzo dei servizi proposti all’interno del bacino di riferimento Sulla base dei risultati del punto precedente, si definirà il target di clienti potenziali, il livello di necessità dei servizi offerti dal progetto, la propensione media alla spesa per tali servizi, ecc…

Max 4000 caratteri

Analisi dell’offerta L’analisi, che si pone l’obiettivo di analizzare la situazione esistente e potenziale del mercato di riferimento (concorrenti esistenti e potenziali, le forze competitive, le dinamiche e le caratteristiche di mercato) sarà strutturata secondo lo schema seguente: 1.Descrizione dei concorrenti attuali e futuri La descrizione della concorrenza dovrà evidenziare la presenza di servizi similari a quelli previsti dal progetto nel bacino di riferimento, descrivendo le caratteristiche dei soggetti gestori, le modalità di gestione e possibili sviluppi futuri dell’offerta (es. presenza di altri progetti già approvati, ecc…)

Max 4000 caratteri

2.Analisi dei servizi offerti L’analisi descriverà le principali caratteristiche dei servizi offerti evidenziandone, se applicabile, i prezzi unitari applicati, gli orari di erogazione, le modalità di comunicazione

Max 4000 caratteri

Conclusioni Sulla base delle evidenze delle analisi effettuate le conclusioni riporteranno la motivazione della scelta progettuale e delle ipotesi alla base delle aspettative di remunerazione del capitale descritte al succesivo punto 29

Max 4000 caratteri

14

29.Descrizione ipotesi operative (costi e ricavi) Descrivere le ipotesi adottate per la quantificazione dei ricavi e dei costi di progetto (es. ricavi: tariffa oraria parcheggio a rotazione, orario di apertura, coefficiente di occupazione spazi disponibili e variazione delle ipotesi nel tempo; costi – personale: numero addetti, costo unitario- manutenzione- costi operativi: natura dei costi e ipotesi alla base del calcolo del totale). Le ipotesi dovranno consentire di verificare il calcolo dei ricavi e dei costi inseriti nelle successive tabelle 30 e 31.

Max 4000 caratteri

30.Sviluppo ricavi4 Sviluppare per le annualità necessarie (max 20 anni)

1 2 3 4 5 6 7 8 9 10 11 12 13 … 20

Ricavi tariffari

Altri ricavi

Totale

31.Costi operativi5 Sviluppare per le annualità necessarie (max 20 anni)

Voce di spesa

1 2 3 4 5 6 7 8 9 10 11 12 13 ….. 20

Costi di gestione

Personale

Manutenzione ordinaria

Totale

32.Ipotesi su Capitale circolante (giorni)

Incasso da clienti (ricavi tariffari)

Incasso da clienti (altri ricavi)

Pagamento a fornitori - costi operativi

Pagamento a fornitori – investimenti

4 Al netto dell’inflazione 5 Al netto dell’inflazione

15

Giorni Base di calcolo 365

33.Redditività del progetto6 (€) Sviluppare per le annualità necessarie (max 20)

FLUSSO DI CASSA Anno 1

Anno 2

Anno 3

Anno 4

Anno …

Anno 20

Anno 20+1

1. + Ricavi (netto IVA) (a)

2. - Costi (netto IVA) (b)

3. = Margine Operativo Lordo (c = a - b)

4. - Costo totale investimenti (netto IVA) (d)

5. + Valore residuo dell’opera7 (e)

6. + Variazione del capitale circolante netto (f)

7. = Flusso di cassa di progetto (g = c - d + e + f)

VAN8 TIR

6 Al netto dell’inflazione 7 Si definisce valore residuo il valore economico dell’opera al termine dei 20 anni: formula: (flusso cassa di progetto anno 20)/5%- da

inserire all’anno 20+1 8 Tasso di attualizzazione pari al 5%



29 October 2010


Annex 5: Results of specific analyses

2

pwc

Quesito: E’ necessario assoggettare a valutazione ambientale strategica (VAS) i “piani integrati"

(cioè conformi all’ art. 44, Reg. 1083/2008) PIU Europa?

I Piani Integrati di Urbani - PIU Europa - si inseriscono all’interno del più ampio contesto dellapianificazione e programmazione territoriale.

Come tali, essi in concreto dovranno conformarsi alla normativa rilevante in materia, di seguitosuccintamente ricostruita:

La Valutazione Ambientale Strategica (di seguito VAS) è stata introdotta dalla Direttiva2001/42/CE, che ne ha fornito il “quadro minimo”, riservando “agli Stati membri il compito didefinire i dettagli procedurali tenendo conto del principio di sussidiarietà” (considerando n. 8, dir.cit.). Tale direttiva è stata - sia pur tardivamente - recepita con il D. Lgs. n. 132 del 3 aprile 2006(“Codice dell’ambiente”) che, all’art. 6, fornisce indicazioni in ordine alle attività che devonoformare oggetto di VAS.

L’art. 6, al quale si rimanda, esordisce con una norma di carattere generale - il comma 1 - in cui siprevede che siano sottoposti a VAS “i piani e i programmi che possono avere impatti significativisull’ambiente e sul patrimonio culturale” e prosegue elencando:

a. i casi in cui vi è una sorta di presunzione di “impatto significativo” e,conseguentemente, i relativi piani e programmi sono sottoposti a VAS;

b. i casi in cui, pur essendo in presenza di un piano che rientra fra quelli sub a), la VASè necessaria solo ove ricorrano determinate condizioni;

c. i casi e le condizioni per le quali la determinazione circa la sottoposizione dei piani oprogrammi è rimessa alla valutazione dell’autorità competente;

d. i casi di esclusione.

Nel caso di specie, i PIU rientrano fra i settori oggetto del precedente punto sub a), in quantol’elenco di cui all’art. 6, comma 2, lett. b) del Codice dell’Ambiente ricomprende il settore della“pianificazione territoriale”.

La pianificazione territoriale è, a mente del riparto di competenze di cui all’art. 117 dellaCostituzione, materia di legislazione concorrente fra lo Stato e le Regioni.

Pertanto, nella Regione Campania, il quadro normativo è dato dalla disciplina nazionale diriferimento (Legge 17 agosto 1942, n. 1150 e ss.mm.ii.) e dalla normativa regionale, ossia dallaL.R. 22 dicembre 2004, n. 16, recante “Norme sul governo del territorio” (di seguito “Legge 16”) edalla L.R. 13 ottobre 2008, n. 13, recante “Piano territoriale regionale” (di seguito “Legge 13”).

In materia di VAS, inoltre, è stato da ultimo emanato il DPGC n. 17 del 18 dicembre 2009,recante “Regolamento di attuazione della valutazione ambientale strategica (VAS) in RegioneCampania”.

L’art. 47 della Legge 16 dispone testualmente che: “I piani territoriali di settore ed i pianiurbanistici sono accompagnati dalla valutazione ambientale di cui alla direttiva 42/2001/CE del 27giugno 2001, da effettuarsi durante la fase di redazione dei piani”.

Pertanto, alla luce della normativa vigente, così come ricostruita, si deve concludere che i PIUdebbano essere sottoposti a VAS.

3

pwc

Quesito: Ai fini di una maggiore efficacia dei Programmi Integrati Urbani PIU EUROPA ed a seguito di unincontro con il DPS, è sorta la necessità di verificare come altre Regioni hanno affrontato la questionedell’ammissibilità delle spese necessarie al restauro conservativo di talune facciate di edifici di pregiostorico- culturale, di proprietà privata. In particolare, durante un incontro del 11 marzo 2010 con il DPS, èstato suggerito alla Regione Campania – AGC 16 – di verificare come la Regione Sardegna, nel periododi programmazione 2000 – 2006, ha trattato la questione, in quanto al DPS risulta che la Sardegna hacertificato tali spese. Pertanto, sarebbe utile verificare le modalità utilizzate, nonché il codice di spesa.

La Legge Regionale 13 ottobre 1998 n. 29 è rivolta alla tutela e valorizzazione dei centri storici dellaSardegna. Alcuni interventi a valere su questa legge sono stati ritenuti coerenti sul POR Sardegna 2000-2006 nella misura 5.1. La L.R. 29 è tra i progetti sponda che sono stati rendicontati sul POR.

Sono stati emanati diversi Avvisi quali Domos, Biddas, ecc. Gli avvisi riguardano reti di comuni ed èprevista il recupero di edilizia privata.

4

pwc

Quesito: Progetto di un parcheggio sotterraneo ad Avellino - Il procedimento in essere ècompatibile con l’eleggibilità a finanziamento mediante l’operazione JESSICA Campania?

Il progetto di parcheggio sotterraneo ad Avellino (di seguito il “Progetto”) presenta serie incongruenze conle prescrizioni deducibili dalla documentazione esaminata in materia di selezione UDF e con le norme eprincipi applicabili, alla luce delle seguenti considerazioni:

1. come ben evidenziato - seppur in maniera succinta - dalla delibera comunale (di seguito la"Delibera"), il Progetto ha avuto una vita molto complessa e, quel che maggiormente rileva, èstato bandito nel 2001, ai sensi dell'allora vigente normativa sul promotore;

2. dopo alterne vicende - tutte menzionate nella Delibera -, l'Amministrazione sarebbe giunta allaconclusione di voler bandire il Progetto ora - anche se non è precisato quando, dal momento chela Delibera non reca una data - ai sensi dell'art. 153, comma 15, "a partire dal punto c) delcomma stesso" del vigente Codice degli Appalti;

3. in base al principio del tempus regit actum, che consente di identificare il regime applicabile aduna specifica procedura di gara in funzione del primo atto ufficiale con cui l'Amministrazione si èrivolta al mercato - ossia, l'avviso del 29.11.2001 nel caso di specie - l'affidamento del Progettodovrebbe essere condotto in base alle norme allora vigenti, come anche confermato dall'Autoritàdi Vigilanza sui Contratti Pubblici che, con la deliberazione n. 8 del 11 ottobre 2007, in materia diproject financing, ha individuato il momento iniziale della gara, che fissa le regole applicabili allagara stessa, in quello della pubblicazione dell'avviso indicativo.

4. di converso, l'Amministrazione ha deciso di proseguire nella procedura di affidamento applicandola normativa oggi vigente. Questa scelta dell'Amministrazione rischia di essere oggetto di ricorsisia da parte della società che ha presentato il progetto che ora si intende mettere a gara - eventoche, peraltro, si è già verificato, come menzionato nella Delibera, anche se su base giuridicadiversa -, sia di eventuali partecipanti alla futura gara che, ove non riuscissero ad aggiudicarsi ilcontratto, potrebbero - legittimamente - sostenere che l'Amministrazione non ha rispettato unodei principi cardini in materia di procedure d'affidamento di contratti di appalti pubblici, ossia chesi applica il regime giuridico vigente al momento dell'indizione della gara equivalente allapubblicazione dell'avviso, datato 29 novembre 2001 nel caso di specie;

5. nel caso in esame, il susseguirsi di modifiche legislative - la procedura di selezione del promotoreè stata profondamente cambiata dal 2001 in poi -, da un lato, e, dall'altro, l'eccessivoprocrastinarsi del momento decisorio in capo all'Amministrazione - in altre parole, come evidentedalla lettura della Delibera, sono passati più di 8 anni da quando il promotore è stato identificato -,rischiano di dare sufficienti motivi di doglianza a tutti i potenziali soggetti interessati a ricorrerecontro la futura procedura di affidamento;

6. questa situazione è in pieno contrasto con il principio secondo cui i progetti che possanocontribuire alla creazione dell'UDF devono essere coerenti con le norme in materia di appalti. E'evidente che nel caso di specie ciò non sarebbe;

7. a questo punto, per riportare il Progetto in coerenza con tali norme, si potrebbe suggerireall'Amministrazione di utilizzare la documentazione relativa al Progetto come base per lo studio difattibilità da utilizzare per indire la gara per l'affidamento del nuovo progetto, ai sensi dell'art. 153,commi 1-14 del Codice degli Appalti Pubblici. Questa soluzione appare coerente anche con larichiesta di modificare l'originale Progetto, aggiungendo la sistemazione della piazza sovrastanteche rappresenta un’ulteriore attività che, di per sé, non può essere affidata nell'alveo della stessaprocedura del Progetto e consente all'originario promotore di partecipare, comunque, alla nuovagara anche se senza il diritto di prelazione che, oggi, non è più riconosciuto in diritto italiano aseguito di una pronuncia della Corte di Giustizia europea in merito alla normativa italiana sugliappalti. Ciò vuol dire, che anche se fosse applicato il regime giuridico previgente, comunque, ilpromotore non potrebbe vedersi riconosciuto il diritto di prelazione, che era, di converso,garantito al momento in cui ebbe inizio l'iter procedurale del Progetto. L'interesse dell'originario

5

pwc

promotore, oggi, deve essere identificato nella partecipazione ad una gara legittima, cosa che lasoluzione prospettata in questo paragrafo mira a garantire. Diversamente, l'affidamento delProgetto rischia di essere illegittimo, per lo meno alla luce dell'interpretazione dellagiurisprudenza comunitaria;

8. in conclusione, tuttavia, si deve evidenziare come il Progetto appaia caratterizzato da unapericolosa confusione in termini di normativa applicabile, che rischia di renderlo attrattore diricorsi e, pertanto, non coerente con le imprescindibili previsioni in materia.

Quesito: Qual è l’impatto della circolare del 30 marzo 2010, n. 15 emessa dalla Ragioneria delloStato del Ministero delle Finanze riguardante il patto di stabilità interno per l’anno 2010sull’operazione JESSICA?

Dalla verifica effettuata in merito alla circolare del 30 marzo 2010, n. 15 (di seguito la “Circolare”)concernente il “patto di stabilità interno” per l’anno 2010 (di seguito il “Patto di stabilità 2010”), ed i suoieffetti nei confronti della operatività del fondo Jessica (“Jessica”) in Campania emerge quanto segue:

la Circolare chiarisce, in via generale, che gli enti assoggettati al Patto di stabilità 2010 -disciplinato ai sensi dell’articolo 77-bis, commi da 2 a 31, del D.L. 25 giugno 2008, n. 112 ess.mm.ii. - sono le province ed i comuni con popolazione superiore a 5.000 abitanti (punto A.3della Circolare),

la stessa Circolare, peraltro, al punto A.8, specifica che le province e i comuni devono escludere"sia dal saldo finanziario considerato quale base di riferimento sia dai saldi utili ai fini del rispettodel patto per gli anni 2010 e 2011", le risorse provenienti "direttamente o indirettamente,dall’Unione Europea, nonché le relative spese correnti ed in conto capitale". A tal riguardo, laCircolare dispone che l’esclusione delle predette spese opera anche se le stesse sono effettuatenel corso di più anni, “purché la spesa complessiva non sia superiore all’ammontare dellecorrispondenti risorse assegnate”. Peraltro, nel caso in cui l’Unione Europea riconoscesse importiinferiori “a quelli considerati ai fini dell’applicazione di quanto previsto dal comma 7-quaterdell'articolo 77 bis del D.L. n. 112/2008", l’importo corrispondente alle spese non riconosciutedeve considerarsi incluso "tra le spese del patto di stabilità interno relativo all’anno in cui ècomunicato il mancato riconoscimento o in quello dell’anno successivo, se la comunicazione èeffettuata nell’ultimo quadrimestre".

In ragione di ciò, è possibile sostenere che le somme che saranno destinate, per il tramite di Jessica, allarealizzazione di progetti di sviluppo urbano in Campania - rectius, progetti da realizzare attraverso fondi disviluppo urbano -, in quanto somme suscettibili di ricadere all’interno delle ipotesi disciplinate,espressamente, dal punto A.8 della Circolare, non rientrano all’interno del Patto di stabilità 2010.

6

pwc

Quesito: Utilizzabilità delle risorse FAS nell’ambito delle iniziative per cui la Regione Campaniaintende utilizzare lo strumento Jessica

Introduzione

Scopo della presente nota è chiarire se le risorse del Fondo Aree Sottoutilizzate (“FAS”) siano utilizzabilinell’ambito delle iniziative per cui la Regione Campania intende utilizzare lo strumento Jessica.

A. Il quadro normativo

1. Il FAS è stato istituito dall’art. 61 della Legge Finanziaria 2003 (Legge 289/2002) ed è, poi, statomodificato dalla Legge Finanziaria 2007 (Legge 296/2006). Il FAS è costituito da risorseaggiuntive nazionali che si sommano a quelle ordinarie e a quelle comunitarie e nazionali dicofinanziamento. L’obiettivo di questo strumento è quello di finanziarie le politiche di svilupponelle aree sottoutilizzate del Paese (essenzialmente il Mezzogiorno e alcune aree del centro-nord). Queste risorse, sommate a quelle derivanti dai Fondi strutturali comunitari, costituiscono lapolitica regionale unitaria inserita nel Quadro strategico nazionale (il “QSN”).

2. Le risorse sono assegnate con delibere del CIPE. La delibera CIPE 166/2007 - modificata, daultimo, dalla delibera 1/2009 - ha assegnato le risorse e disciplinato la programmazione del FASper il periodo 2007-2013.

3. I principi generali sono:

a. principio di prevalente destinazione delle risorse ad obiettivi di riequilibrio economicosociale, così come previsto dall'art.119, comma V della Costituzione;

b. principio di addizionalità delle risorse, che non possono sostituirsi a quelle della politicaordinaria;

c. principio di sussidiarietà e di adeguatezza territoriale del livello di programmazione edattuazione degli interventi, con conseguente adozione di criteri di demarcazione delcampo di intervento dei Programmi Nazionali e Interregionali FAS, in particolare di quelliche integrano e complementano per la stessa Priorità Programmi Operativi Nazionali eInterregionali cofinanziati da risorse dei fondi strutturali.

4. In via generale la programmazione FAS può intervenire, comunque in attuazione della strategiadel QSN:

5. sui medesimi ambiti e sulle medesime linee di intervento previste dalla corrispondenteprogrammazione operativa comunitaria (ove presente), rafforzandone l’intensità di azione;

6. su ambiti diversi ai fini dell'integrazione territoriale o tematica di tali linee di intervento.

7. La programmazione si articola in diverse priorità e la sua attuazione avviene tramite:

a. APQ, nel caso in cui sia prevista la cooperazione di più autorità a livello regionale enazionale;

b. strumenti diretti, per le linee di intervento dei programmi che si ritiene non necessitino infase attuativa di un’azione di cooperazione interistituzionale, da attivarsi secondoprocedure e regole adottate in funzione della massima efficacia dell’azione pubblica.

8. Per quanto riguarda la programmazione a livello regionale - che qui interessa -, questa deveessere predisposta tramite Programmi attuativi FAS Regionali (“PAR”) a titolarità delleAmministrazioni regionali responsabili della loro definizione e attuazione, nonché destinatariedelle risorse FAS assegnate, dal CIPE. I PAR sono inviati dalle Amministrazioni responsabili alMISE–DPS (ora DSC) per la verifica di coerenza ed efficacia programmatica e attuativa rispettoai criteri e alle regole generali della politica regionale unitaria, agli obiettivi dichiarati, alle altrelinee di intervento finanziate da altre risorse in conto capitale nei medesimi ambiti.

9. In esito a tali verifiche, è autorizzato - previa trasmissione al CIPE per presa d’atto e verifica - conprovvedimento formale del MISE-DSC, l'utilizzo delle risorse FAS per la parte attuata con

7

pwc

strumenti diretti ed è avviata la fase di cooperazione istituzionale per la parte da attuarsi tramiteAPQ. Con il provvedimento di approvazione del PAR, lo Stato assume nei confronti della singolaRegione l’obbligazione per le quote annuali di risorse finanziarie indicate nel programma stesso.

10. Una volta approvati i programmi delle singole amministrazioni coinvolte, per quanto riguarda irequisiti in termini di impegno della spesa sul FAS, la delibera CIPE 1/2009 prevede che, a penadi revoca automatica delle somme, devono essere assunti impegni giuridicamente vincolantiriguardo agli interventi ammessi:

a. per il 10%, entro il 31.12.2010,

b. per il 40%, entro il 31.12.2012,

c. per l’80%, entro il 31.12.2014,

d. per il 100%, entro il 30.06.2016.

11. Il rispetto dei termini è, tuttavia, “correlato” alla regolarità dei trasferimenti delle risorse da partedello Stato.

12. Si segnala che nella seduta del 13 maggio 2010 il CIPE ha adottato una nuova delibera in meritoalla ripartizione delle risorse del FAS, non ancora pubblicata, né definitivamente approvata.

B. L’attuazione del FAS in Campania

1. Per quanto riguarda la Regione Campania, la stessa ha predisposto la proposta di PAR condelibera di Giunta regionale n. 1144 del 19 giugno 2009 (la “DGC PAR”). Questa proposta nonrisulta essere stata ancora approvata dal MISE-DCS.

2. In merito ai progetti per la riqualificazione urbana, per i quali la Regione Campania intendeattivare lo strumento Jessica, la DGC PAR prevede l’uso del FAS in maniera complementare allelinee d’azione previste per l’obiettivo specifico 6.a della programmazione dei Fondi strutturali,ossia “Rigenerazione urbana e qualità della vita”, in particolare, l’uso del FAS è previsto, inrelazione a tale obiettivo, sulle priorità del FAS:

a. 4 “Inclusione sociale e servizi per la qualità della vita e l’attrattività territoriale”, per cui èprevisto l’obiettivo operativo 4.2 “Garantire migliori condizioni di sicurezza” e in cui sonocomprese le “Azioni di rigenerazione urbana finalizzate a migliorare le condizioni di vita esicurezza dei gruppi svantaggiati”;

b. 8 “Competitività e attrattività delle città e dei sistemi urbani”, in cui è previsto l’obiettivooperativo 8.1 “Sviluppare il sistema policentrico delle città e innalzare la qualità della vita”,che comprende le varie linee d’azione relative alla riqualificazione urbana delle cittàmedie.

C. L’uso del FAS per le operazioni Jessica individuate dalla Regione Campania

1. Alla luce della sintetica ricostruzione di cui sopra, non si vede alcun ostacolo, in linea di principio,all’utilizzo del FAS per le operazioni, nell’ambito dell’obiettivo specifico 6.a della programmazionecomunitaria, che la Regione Campania ha individuato ai fini dell’utilizzo dello strumento Jessica.

2. Infatti:

c. gli obiettivi perseguiti sono compatibili con le priorità del FAS e con i principi del suoutilizzo;

d. gli interventi previsti afferiscono i medesimi ambiti e le medesime linee di interventopreviste dalla corrispondente programmazione operativa comunitaria, rafforzandonel’intensità di azione.

3. Sotto il profilo attuativo, tuttavia, si segnala che il PAR della Regione Campania non risultaessere stato ancora approvato. Ciò comporta lo slittamento delle tempistiche previste dallaDelibera CIPE 1/2009.

1

PricewaterhouseCoopers Advisory



29 October 2010


Annex 6: Presentations

Iniziativa JESSICA

Esempio Operazione Parcheggio - Piazza

Descrizione dell’operazione

Durata progetto: 23 anni (inclusi tre anni di costruzione)

Mix di Interventi:

• Parcheggio sotterraneo

• Riqualificazione piazza pubblica sovrastante parcheggio

• Infrastrutture urbane per la viabilità di accesso al parcheggio

Investitori:

• Privati

• Comune (apporto in natura del terreno)

• JESSICA

• Istituzioni finanziarie

Costo investimento: € 5,96 mln

Ipotesi di base

Interventi

• Parcheggio sotterraneo e viabilità di accesso:

• 6000 mq

• 170 posti auto

• 50 box auto (30 mq ciascuno)

• Riqualificazione piazza: 2000 mq da allestire con panchine, aiuole e percorsi pedonali

Costo totale investimento: 5.960.000 €

• Parcheggio sotterraneo e viabilità di accesso: 5.460.000 € (910 €/mq – costruzione,ingegneria, imprevisti, oneri)

• Riqualificazione piazza: 500.000 €

Principali fonti di Ricavo:

• Affitto posti auto a rotazione: 775.000 €/anno a regime:

170 posti auto, 1 €/ora, 16 ore di apertura giornaliera, tasso occupazione 80%

• Vendita box auto: 33.0000 €/box (1.100 €/mq):

20 box venduti nel primo anno, 30 nel secondo

Principali Costi operativi gestione parcheggio:

• Personale per guardiana: 150.000 €/anno a regime: 5 guardiani (turni 8 ore)

• Facility management (pulizia, manutenzione, utenze): 153.000 €/anno a regime : 30€/mqanno(esclusi box privati)

• Spese generali: 22.500 €/anno a regime (15% costi personale)

Iniziativa Jessica: casi analizzati

JESSICA

Caso

baseDebito Equity

Equity/

Debito

Debito no si no si

Equity no no si si

Tasso interno di rendimento (%) 1,8% 1,8% 1,8% 1,8%

Rientro investimento (anni) 20 20 20 20

Equity 1.984 1.122 1.122 1.122

Comune* 0,0% 0,0% 0,0% 0,0%

Privati 100,0% 100,0% 50,0% 50,0%

JESSICA 0,0% 0,0% 50,0% 50,0%

Debito 2.976 4.488 4.488 4.488

Istituzioni f inanziarie 100,0% 60,0% 100,0% 60,0%

JESSICA 0,0% 40,0% 0,0% 40,0%

Fondo perduto 1.000 350 350 350

Totale JESSICA - 1.795 561 2.356

Coinvolgimento

di JESSICA

Progetto

Finanziamento

• Nei casi JESSICA è prevista la partecipazione del Comune all’equity mediante apporto in natura delterreno

Gli indici f inanziari sono calcolati su 23 anni (3 realizzazione + 20 gestione)

Iniziativa Jessica: benefici per gli stakeholders

JESSICA

Caso

baseDebito Equity

Equity/

Debito



Fondi utilizzati 1.984 1.122 561 561

Tasso interno di rendimento (%) n.a 6,4% 8,9% 6,7%

Rientro investimento (anni) n.a 14 6 13

Fondi utilizzati n.a 1.795 561 2.356

Tasso interno di rendimento (%) n.a. n.a. n.a. n.a.

Rientro investimento (anni) n.a. n.a. n.a. n.a.

Fondi utilizzati - - - -



Fondi utilizzati 2.976 2.693 4.488 2.693

Tasso interno di rendimento (%) (2,7)% 10,1% 23,6% 9,9%


Fondi utilizzati 1.000 2.145 911 2.706

IRR 1,8% 1,8% 1,8% 1,8%

Payback 20 20 20 20Progetto

Privati

JESSICA

Comune

Istituzioni finanziarie

Prospettiva pubblica

(FESR+Comune+JESSICA)

• Nei casi JESSICA è prevista la partecipazione del Comune all’equity mediante apporto in natura delterreno

• Gli indici f nanziari sono calcolati su 23 anni (3 realizzazione + 20 gestione)



29 October 2010


Annex 7: Description of the activities carried out

Date:

5 August 2010

Client Name:

European Investment BankJESSICA Task Force

Final Report:

JESSICA Evaluation Study


Document version:

Annex 7- description of the activities carried out.docx

Submitted by:

PricewaterhouseCoopers Advisory SpALargo Angelo Fochetti 2800154 RomaItaliaTelephone +39 06 570831Facsimile +39 06 570832536www.pwc.com


pwc 3

Table of contents

1 Introduction 4

2 Preliminary Evaluation Phase 6

2.1 Identification of objectives and priorities of ERDF OP related to urban regeneration 6

2.2 Drawing of the context for JESSICA implementation 6

2.3 Assessment of the applicability of JESSICA to the urban regeneration initiatives in place 8

2.4 Screening of projects 9

2.5 Preliminary proposal for the administrative process to be followed for including “Altre Città” initiativeinto JESSICA operation 10

3 Support to Start-up phase 11

3.1 Identification of financial, organisational and legal structure of JESSICA instruments in CampaniaRegion 11

3.1.1 Definition of the Investment Strategy 11

3.2 Support in the identification and implementation of administrative procedure for the application ofJESSICA to “Altre Città” initiative 12

3.3 Identification of pilot projects and quantitative simulation of JESSICA operation 13

3.4 Support related to specific matters 14

3.5 Stakeholders consultation 15


pwc 4

The study was structured in two phases:


financial instruments in the context of the Campania Region, evaluating the applicability of

JESSICA to the initiatives in place within the ERDF OP for regenerating urban areas within the

Region, drafting the administrative path for the implementation of JESSICA. Output of this phase

is the Interim Report;

A support to start-up phase, in which, starting from results of the preliminary phase, we defined

the financial, organizational and legal structure of JESSICA instruments in Campania Region,

identified the investment strategy and carried out on-demand analyses to clarify outstanding legal

issues and topics related to the use of structural funds. At this stage we simulated the initiative

from a quantitative point of view, through the assessment of pilot projects, and supported the

Managing Authority in communicating benefits of JESSICA to the interested parties (mainly

municipalities and municipalities associations). Overall output of this phase is the Final Report.

However, several intermediate outputs were produced.

Both phases included activities related to the three main fields: structural funds, financial and legal and

involved the delivery of one or more documents.

The figures below summaries activities and related outputs produced.

Figure 1 Preliminary evaluation phase: activities and outputs

1 Introduction

Identification of objectives andpriorities of ERDF OP related tourban regeneration

Drawing of the context forJESSICA implementation (partiesinvolved, expectations, priorities)

Assessment of applicability ofJESSICA to the initiatives inplace

Screening of projects

Preliminary proposal for theadministrative process to befollowed for including “AltreCittà” initiative into JESSICAoperation


InceptionReportOutput Task and activities



pwc 5

Figure 2 Support to start-up phase: activities and outputs

We carried out activities in close cooperation with the Jessica Task Force. Analyses are based on

information provided by the ROO and its staff.

Identification of financial,organisational and legalstructure of JESSICAinstruments in Campania Region

Definition of the InvestmentStrategy

Support in the identification andimplementation of administrativeprocess for the application ofJESSICA to “Altre Città” initiative

Identification of pilot projectsand quantitative simulation ofJESSICA operation

Support related to specificmatters (finalisation of theFunding Agreement, analyses ofspecific topics, etc..)

Stakeholders consultation


Output

Structure of JESSICAinstruments in Campania

Region -Annex 2

Investment Strategy andPlanning -Annex 3

Identification of PilotProjects -Annex 1

Results of analyses -Annex 5

Presentations -Annex 6

Application Form AltreCittà (Annex to the

Expression of Interests)

Annex 4

Task and activities



pwc 6

Activities carried out during the preliminary evaluation phase are described in the following paragraphs,

with the summary of main results achieved. Full description of the results of this phase of analysis is

included in the Inception Report.

Tasks performed are divided by the three main fields: structural funds, financial and legal.

2.1 Identification of objectives and priorities of ERDF OP related to urban regeneration

Methodology adopted

Objectives and priorities of urban regeneration set at national and Regional scale have to be clearly

identified since they create the strategic guidelines for JESSICA implementation.

To this end, at the very beginning of the assignment, we carried out the following activities in the field of

structural funds:

Review of programming documents at, National (QSN1) and regional (PTR

2, Guidelines for house

planning3, Regional Piano Casa, OP FAS

4) level defining the general programming framework in

which sustainable urban development strategies are elaborated;

Analysis of the Operational Programme 2007-2013 for Campania, with specific attention to the

Sustainable Urban Development issues (Axis 6.1.);

Analysis of the urban regeneration initiatives in place in the Region.

The task did not involve activities in the legal and financial fields.

Main results

The analyses resulted in the synthesis of objectives and priorities designing the sustainable urban

development strategy for the Region and in the identification of two main urban regeneration initiatives in

place in the Campania Region: the “PIU Europa” and the “Altre Città” initiatives, established under ERDF

OP Operational Objective 6.1. Both present the characteristic of Integrated Urban Planning and foresee a

multi-axis and multi-instruments approach for the funding of projects. Results of the analyses are reported

in paragraph 3.1 of the main report.

2.2 Drawing of the context for JESSICA implementation

Methodology adopted

The implementation of JESSICA instruments has to be assessed against the peculiar context of the

Campania Region. To this end, while identifying objectives and priorities for urban regeneration, we

analysed the Regional environment from a wider perspective. In particular, the following activities in the

field of structural funds were performed:

1 National Strategic Plan2 Regional and Territorial Plan3 On March 6th, 2009, the Campania region approved the “Guidelines and operative procedures for social housing and urban

renewal of urban territories affected by deprivation and physical deterioration”4 Regional Implementation programme of “Fondo Aree Sottoutilizzate”

2 Preliminary Evaluation Phase


pwc 7

Identification of parties involved in the implementation of Programmes for urban regeneration,

their role and responsibility. Aim of this task was identifying main players in the development of

the JESSICA initiative so to create the basis for a clear definition of the responsibility framework

for the JESSICA initiative. Through a desk review of the organisational structure of the Campania

Region we identified Functions/Divisions/Units that could be in any way involved in urban

regeneration related activities. Then, through specific interviews with the ROO and its staff, we

identified precise roles, allocation of responsibilities and procedures in place within the Region.

Result of this task was the identification of parties that would play a major role in case JESSICA

initiative were implemented;

Assessment of the degree of knowledge of the functioning of JESSICA financial instruments by

those identified as potential main players. This activity was performed through group meetings

aimed at explaining the functioning and the benefits of the instruments.

Preliminary proposal of a structure for the implementation of JESSICA that could fit with the

Regional priorities for urban regeneration, the initiatives in place in the Region and the

expectations of parties involved. Following the explanation of the functioning and benefits of

JESSICA instruments, this activity started with the identification of expectations and priority of the

Campania Region for the development of the initiative. The task ended with a proposal, shared

with representatives from the Region and the JESSICA Task Force, for the structure of JESSICA

initiative in Campania.

The task did not involve activities in the legal and financial fields

Activities were carried out on the basis of information and documents provided by the ROO and its staff.

In order to facilitate information sharing, while performing the tasks, the PwC team was based in the

premises of the Operational Objective 6.1. Unit.

Main results

The ROO and the Managing Authority were identified as being the major players inside the Campania

Region in case the JESSICA initiative were implemented. Indeed, while the the latter is responsible for

the management of funds under ERDF OP, the former is responsible for the implementation of

Operational Objective 6.1. as well as for other initiatives among which:

the management of FAS,

the management of the revolving credit fund of multiannual programmes of social housing,

some initiatives included in the Regional Piano Casa (such as the renewal of IACP5buildings),

The ROO and its staff showed a medium degree of knowledge of JESSICA instruments that improved

following our explanations allowing a smooth identification of priorities and expectations of the Campania

Region for JESSICA implementation.

As a consequence of identified priorities and expected benefits, the need of having a Holding Fund and

the EIB as holding fund manager became evident as well as the involvement of a single Urban

Development Fund (UDF) investing in “PIU Europa” and “Altre Città” initiatives and potentially, at a later

stage, the involvement of another UDF investing in other kind of programmes. In addition, in order to

maintain the centralised oversight over the urban planning within the Region, the ROO required to shape

5 Social Housing Association


pwc 8

the JESSICA operations so to foresee, before being financed by the UDF, a compliance check of projects’

eligibility against the urban planning criteria set at Regional level.

Results are summarised in paragraph 3.1. of the main report.

2.3 Assessment of the applicability of JESSICA to the urban regeneration initiatives in

place

Methodology adopted

Following the proposal of a preliminary structure for JESSICA operation, the feasibility of a priority

application of the instruments to the two initiatives in place in the framework of ERDF OP Operational

Objective 6.1.was verified (the “PIU Europa” and the “Altre Città” initiatives).

The assessment was based on the comparison between main characteristics of the two initiatives and

projects’ eligibility criteria for access to JESSICA funding. This involved the following activities in the field

of structural funds and in the legal field:

Structural funds:

o Analysis of eligibility criteria of cities and projects foreseen by the two initiatives, including

integrated urban planning, purpose of projects, amount of investment, parties involved-

i.e. private versus public entities;

o Identification of category of eligible expenses;

o Description of the status of implementation of the initiatives and description of the

administrative procedure set up by the Campania Region;

o Elaboration of a Jessicability Map (Generation of revenues versus expenses eligible for

ERDF funding), identification of category of projects that best fit with JESSICA

requirements (Jessicable projects) and positioning of such categories in the Jessicability

Map.

Legal:

o Analysis of the compatibility of administrative procedures set up by the Campania Region

for the implementation of the two initiatives with the criteria for the implementation of

JESSICA.

The task did not involve activities in the financial field.

Activities were carried out on the basis of information and documents provided by the ROO, its staff and

its Technical Assistance Team. In order to facilitate information sharing, while performing the tasks PwC

team was based in the premises of the Operational Objective 6.1. Unit.

Main results

The analyses highlighted the applicability of JESSICA instruments to revenue generating projects

included in both initiatives. However, due to the early definition phase of the “Altre Città” initiative, the

analysis underlined the importance of defining an appropriate administrative process for its

implementation in order to comply with the JESSICA requirements.


pwc 9

2.4 Screening of projects

Methodology adopted

Based on the results of the assessment of JESSICA applicability to the exisiting urban regeneration

initiatives, we screened all projects included in the PIU Europa initiative (Altre Città initiative was still at a

early stage of definition, implementation phase had not started yet) with the aim of identifying a

preliminary list of potential eligible projects to be financed by JESSICA.

To this end all projects were included in the Jessicability Map and those considered as Jessicable

projects were selected for an in depth analysis. The task involved the following activities in the financial

field:

Analysis of available projects documentation and archiving of information in a database. The

available documentation mainly consisted of the forms filled in by the projects promoters at the

time projects were presented to the Campania Region. Main information reported in the forms are:

o Name of the city that promotes the project,

o total amount of investment,

o amount of public investment (through EU or national grants),

o amount of private investment,

o intervention area and scope of the project,

o description of revenue generating activities, if any,

o description of the implementation phase,

o length of the investment phase.

Identification of criteria for the assessment of the profitability of projects. Due to the limited

information on projects available at that stage, profitability was assessed against the scale null,

low, medium, high, were:

o Null profitability is assigned to urban furniture designs, to projects aimed at improving

mobility and circulation, to the refurbishment of Educational Buildings and to interventions

aimed at improving security of areas

o Low profitability is assigned to the refurbishment of squares (due to the possibility of

foreseeing commercial activities, such as newspaper stands), of historical buildings

(when associated with the introduction of low revenues generating activities, such as

public art galleries or libraries), of historical city centres and to intervention aimed at

rationalising the public transport system;

o Medium profitability is assigned to the refurbishment of historical buildings (when

associated with the introduction of potential profitable commercial activities, such as

cinemas or theatres),to leisure and sport centres projects, to the refurbishment of

squares associated with the construction of underground parkings, and to the expansion

of ports.

o High profitability is assigned to interventions related to the development of intermodality,

to the construction of multifunctional centres devoted to commercial and service activities

and to the construction of SPA centres.


pwc 10

Identification of percentage of expenses eligible for ERDF funding. The parameter used was the

amount of public contribution on the total amount of investment. Projects were assessed against

the scale null (0%), low (> 0% <= 30%), medium (> 30% <= 70%), high (> 70%)

Activities were carried out based on information and documents provided by the ROO its staff and its

Technical Assistance Team. In order to facilitate information sharing, while performing the tasks, the PwC

team was based in the premises of the Operational Objective 6.1. Unit.

The task did not involve activities in the legal and structural funds fields

Main results

This activity highlighted the existence of 15 Jessicable projects that could be chosen as pilot projects for

the quantitative simulation of JESSICA operation and a large number of projects that could become

Jessicable after adequate reshaping and aggregations.

2.5 Preliminary proposal for the administrative process to be followed for including

“Altre Città” initiative into JESSICA operation

Methodology adopted

Results of the assessment of the applicability of JESSICA to the existing urban regeneration initiatives

highlighted the importance of setting up an administrative process for the implementation of the “Altre

Città” initiative aligned with JESSICA parameters.

Thus, the following activities in the legal field were performed:

Analysis of the official documents related to the initiative issued by the Region;

Analysis of the administrative procedure established for the “PIU Europa” initiative;

Development of a preliminary proposal for the administrative path to be followed for making the

“Altre Città” initiative compliant with JESSICA parameters.

The task did not involve activities in the Structural Funds and financial fields.

Main results

Due to the strong relationship between the two initiatives, the administrative process for “”Altre Città”

should be, at least in its main principle, similar to the one in place for the “PIU Europa”.

The long time required for setting up and completing the “PIU Europa” administrative path would not fit

with the JESSICA implementation requirements. Thus, a need for simplification was highlighted.

The administrative path should not foresee any public procurement issued by the Region, but, due to the

Resolution regarding the potential distribution of ERDF Funds to the Cities, it would require publishing of

a public notice (Request for Expression of Interest) to inform Cities about the new initiative in place

related to the ERDF Funds and about criteria to accede to it.


pwc 11

Activities carried out during the support to start-up phase are described in the following paragraphs, with

the description of main results achieved and deliverables produced.

Tasks performed are divided according to the three main fields covered: structural funds, financial and

legal.

3.1 Identification of financial, organisational and legal structure of JESSICA

instruments in Campania Region

Methodology adopted

Starting from the results of the Preliminary evaluation phase, the following tasks were performed with the

aim of defining the organizational, legal and financial architecture for the use of JESSICA financial

instruments in Campania Region:

Financial and legal field:

o Definition of the overall architecture of JESSICA operation, including entities involved

(Holding Fund, UDF, ROO, Projects, public and private investors), other sources of

financing (public/private/grants), financial and legal relationships among the entities

involved;

o Identification of the most suitable entity for playing the role of the UDF;

o Structuring of the roles and responsibility framework of the entities involved.

Structural funds field:

o Identification of major benefits for the Campania Region.

Legal field:

o Feasibility analysis of the adoption of JESSICA financial instruments for the

implementation of the Regional “Piano Casa”.

Activities were carried out in strict cooperation with JESSICA Task Force and involved several meetings

with the ROO and its staff to agree on the final version of the document.

Main results

Identification of financial, organisational and legal structure of JESSICA instruments in Campania Region

and benefits produced for the Campania Region, as described in paragraph Error! Reference source

not found. of the main report.

Deliverables

Results of the analysis were summarised and presented in the document “Structure of JESSICA

instruments in Campania Region”, Annex 2 to the main report. The document is in Italian language, since

it was addressed to the Campania Region.

3.1.1 Definition of the Investment Strategy

Methodology adopted

3 Support to Start-up phase


pwc 12

As a consequence of the positive results of the preliminary evaluation phase and following the agreement

on the financial, organisational and legal structure of JESSICA instruments to be adopted in Campania,

EIB and Campania Region decided to enter in the start-up phase of JESSICA implementation. First step

was the definition of the Investment Strategy. At this stage, the following tasks in the financial and legal

fields were carried out:

Identification of main topics to be included in the Investment Strategy and sharing of the

document structure with both the EIB and the Campania Region (Context, Description of the “PIU

Europa” and the “Altre Città” initiatives, Criteria for Investment selection, Role played by the ROO,

Investment products, Maximum and minimum percentages planned to be held, investment limits,

Planning)

Elaboration of a first draft of the Investment Strategy based on the structure of the operation

already agreed to be used as a base for discussion between EIB and the Campania Region;

Elaboration of the final version of the Investment Strategy that incorporated comments from all

parties.

The task did not involve activities in the structural funds field.


with the ROO and its staff agree on a final version of the document.

Main results

Finalisation of the Investment Strategy described in paragraph 3.4 of the main report.

Deliverables

Investment Strategy and planning- Annex to the Funding Agreement (Annex 3 to the main report).

3.2 Support in the identification and implementation of administrative procedure for

the application of JESSICA to “Altre Città” initiative

Methodology adopted

Following the results of the preliminary proposal for the administrative procedures to be applied in order

to include “Altre Città” initiative into JESSICA operations, the Campania Region decided to define and

start up the administrative process to enable the application of JESSICA financial instruments to the “Altre

Città” initiatives. In this context, the following activities in the legal, financial and structural funds fields

were performed:

Legal field:

o Review of the administrative process proposed by the Campania Region to verify the

compliance with JESSICA requirements;

o Review of the Application Form for the submission of projects and plans by Municipalities

to verify the compliance with the legislation in place on public procurement.

Financial Field:


pwc 13

o Description of criteria to be fulfilled for the admission of Projects to the JESSICA initiative

to be included by the Campania Region in the Expression of Interests tendering

documents;

o Elaboration of the Application Form for the submission of projects and plans by

Municipalities (only parts related to JESSICA initiative);

o Review of the whole Application Form for the submission of projects and plans by

Municipalities.

Structural Funds field:

o Identification of an appropriate definition of “Integrated Urban Development Plans” to be

included by the Campania Region in the Expression of Interests’ tender documentation.


with the ROO and its staff to get to an agreed administrative process and to a shared version of the final

documents.

Main results

Identification of the administrative process (described in paragraph 3.2.2. of the main report) to be

followed for applying JESSICA instruments to the “Altre Città” initiative.

Finalisation of the Expression of Interests and process start-up.

Deliverables

Application Form for the submission of projects and plans by Municipalities (Annex 5 to the main report).

3.3 Identification of pilot projects and quantitative simulation of JESSICA operation

Methodology adopted

The screening of projects performed during the preliminary evaluation phase highlighted 13 projects of

the PIU Europa initiative that showed a potential Jessicability and a number of other projects that, if

aggregated in the appropriate way, could be Jessicable.

Starting from this preliminary result, criteria for selecting pilot projects for the simulation were set, in

accordance with the priority set by the ROO. The following criteria were adopted:

Amount of the investment (>5 M€);

Type of initiative (priority was given to those initiatives that could be replicated in other Cities);

Status of the implementation of the initiative (priority was given to initiatives in an advanced

feasibility phase, since they offered enough information for the analysis but could still be shaped

so to reach the highest results in terms of social benefits and profitability, if needed);

Involvement of private partners;

Interest expressed by the City who promoted the project in taking part to the JESSICA initiative.

For each project identified as potential pilot, a financial analysis was run. The analysis is based on:

Estimation of investment amount (construction, modernisation, rehabilitation, lease, etc…);


pwc 14

Identification and estimate, on the base of specific assumptions, of revenues streams (from sale,

renting of spaces, operation of specific activities, etc..);

Estimation of tax rate;

Equity/loan structure and assumptions (i.e. equity amount, facility amount, interest rate, loan

duration, grace period);

Assumption for the strategy for the distribution of dividends to shareholders.

For each project, the key performance indicators (IRR, payback period, type and amount of funds) with

and without using JESSICA instruments were calculated from each stakeholder’s perspectives (Private

partners, JESSICA, Financial institutions, Municipality, public sector, etc…).

Then, simulations of a UDF investing in the portfolio of projects was performed so to optimise the

utilisation of structural funds and at the same time ensure adequate performance parameters for all

stakeholders involved.

The simulation of the Holding Fund’s investnent in the UDF was implemented, taking into account the

revolving nature of the operation.

The task involved activities in the financial field. No activity in the structural funds and legal fields was

required.

Information on projects was provided by the ROO and its staff.

Main results

Quantitative simulation of the operations described in paragraph Error! Reference source not found. of

the main report and in its Annex 1.

Deliverables produced

“Identification and analysis of Pilot Projects”- Annex 1 to the main report.

3.4 Support related to specific matters

Methodology adopted

During the start-up phase several ad-hoc supporting activities were required. In particular:

Support in the legal field:

o Assessment of the adoption of Jessica instruments for the implementation of the Piano

Casa in the Campania Region;

o Legal assistance to EIB was provided during the negotiation phase of the Funding

Agreement mainly aimed at preventing disagreements due to English and Italian

semantics;

o Analysis of the compliance of a procurement process related to an underground parking

to be constructed in the City of Avellino with the requirements for the eligibility to

JESSICA initiative;

o Assessment of the need of a Strategic Environmental Assessment (VAS) for the “PIU

Europa” and “Altre Città” Integrated Urban Plans.


pwc 15

o Analysis of the impact of the Stability Pact rules on the JESSICA initiative in the

Campania Region.

o Assessment of the adoption of FAS funds in the framework of JESSICA initiatives in the

Campania region.

Support in the structural funds field:

o In order to assess the eligibility of expenses for the renewal of the facades of private-

owned historical buildings, the case of Sardinia Region was analysed.

No ad-hoc support was required in the financial field.

Main results

Results of the analyses showed that:

Based on the information available when the assessment was performed (end of January 2010)

JESSICA instruments may be used for the for the implementation of the Piano Casa through a

dedicated UDF.

The project of the underground parking in Avellino could not be financed through JESSICA

financial instruments, since the procurement process followed does not meet the requirements

set at EU level.

Based on current national legislation, Integrated Urban Plans of both “PIU Europa” and “Altre

Città” initiatives are to be subject to Strategic Environmental Assessment (VAS).

During the 2000-2006 programming period, interventions related renewal of the facades of

private-owned historical buildings were considered eligible under Measure 5.1. of OP FESR

Sardinia 2000-2006.

According to the note issued by the “Ragioneria dello Stato” of the Italian Ministry of Finance on

March 30th, 2010, investments made by local authorities using JESSICA instruments are not

subject to stability pact rules.

From a legislative perspective, there are no obstacles to the adoption of FAS funds, as additional

resources to the Structural Funds, in the framework of the implementation of the JESSICA

initiative in the Campania region.


Results of specific analyses are reported in Annex 5 of the main report.

3.5 Stakeholders consultation

Methodology adopted

The ROO and its staff have been stimulating and guiding Cities towards integrated urban planning

associated with a on-going public-private dialogue in coherence with priorities and principles set at

Regional level for several years. They constantly meet representatives from the Cities to discuss, approve,

reject, and reshape proposed initiatives. In addition they are responsible for the implementation of the

“PIU Europa” and “Altre Città” initiatives. In this context, the stakeholders’ consultation was structured as

follows:


pwc 16

Meetings with the ROO and its staff aimed at gathering information on procedures in place in the

Region, allocation of roles and responsibilities within the Region, “PIU Europa” and “Altre Città”

initiatives and projects.

Participation in the workshops organised by the ROO to inform main stakeholders of the launch of

JESSICA initiatives and development of supporting material. Two workshops were organised.

The first one took place on February 12th, 2010 and was addressed to representatives from the

19 Medium-sized Cities included in the “PIU Europa” initiative. The second took place on March

10th, 2010 and was addressed to the representatives from the 21 medium-sized Cities included in

the “Altre Città” initiative. Aim of the first workshop was stimulating Cities to take part in JESSICA

initiative and introducing Jessicable projects in the PIU Europa Integrated Urban Plans. To this

end, EIB and the functioning of JESSICA financial instrument were presented showing major

benefits to Cities deriving from participating in the initiative. We supported EIB in preparing the

presentation for the workshop. Aim of the second workshop was informing representatives from

the 21 Cities on the administrative process set-up for the implementation of JESSICA initiatives

and stimulating the development of Jessicable projects as well as showing them expected

benefits for all parties involved. To this end, we prepared an example of Jessicable project

regarding the realisation of an underground parking and the refurbishment of the public square

above it (due to the lack of parking areas, this type of project is very common in the Region)

showing both financial and non-financial benefits for all parties involved.


Presentations for the two workshops, included in Annex 6 to the main report.


pwc 17

European Investment Bank - European...

Documents

Transcript of European Investment Bank - European...