1. WATER UTILITY REFORM PLAN

2. PRINCIPLES OF THE SECTOR POLICIES
Utility company owns the assets
Municipality owns the utility company
Water supply and waste water treatment services-commercial activity
Full cost recovery based on the tariff structure
Regulatory framework related to natural monopoly
Government of Montenegro to facilitate capital investments
Government of Montenegro to promote the regionalization of services

3. ELEMENTS OF THE REFORM Decentralization and voluntary regionalization
Corporative management
(independent Board, independent audit)
Commercialization
(utilities-legal entities, commercial behavior)
Regulation of natural monopoly (establishing of the regulator)
Capital financing
(Government to facilitate the access to capital; local governance and utilities to increase ability for taking and returning the loans)

4. THE LAW ON WATER SUPPLY AND WASTE WATER TREATMENT
Effort commissioned by the Ministry of Tourism and Environment
Funded by the U.S Trade Development Agency with assistance also from the U.S. Agency for International Development

5. PRINCIPLES Quality Quantity Continuity
Sustainability and environmental protection
Corporative independence and commercial behavior
Transparency
Protection of the public interest

6. UTILITY-ESTABLISHING
UTILITY FOR ONE MUNICIPALITY –LIMITED LIABILITY COMPANY
UTILITY FOR TWO OR MORE MUNICIPALITIES-
LIMITED LIABILITY COMPANY/SHARE HOLDERS’ COMPANY
FOUNDER- MUNICIPALITY(IES)

7. UTILITY– OWNERSHIP UTILITY IS THE OWENRSHIP OF MUNICIPALITY(IES)
ASSETS ARE THE OWNERSHIP OF THE UTILITY
UTILITY CANNOT TRANSFER THE ASSETS WITHOUT APPROVAL OF THE MUNICIPALITY

8. UTILITY– FUNCTIONS PROVIDING OF THE SERVICES (DIRECTLY OR INDIRECTLY)
ESTABLISHING THE PROCEDURES RELATED TO SERVICE DELIVERY
MAINTENANCE OF THE SYSTEM
ALWAYS RESPONSIBLE TO MUNICIPALITY AND TO CITIZENS (PROTECTING OF THE PUBLIC INTEREST)

9. UTILITY– STRUCTURE
BOARD OF DIRECTORS
DIRECTOR
STAFF

10. UTILITY-BOARD
NOMINATION-THE COUNCIL FOR THE PROTECTION AND DEVELOPMENT OF THE LOCAL GOVERNANCE
APPOINTING- MUNICIPAL ASSEMBLY
KEY TASKS:
DEFINES THE POLICIES OF THE COMPANY
APPOINT THE DIRECTOR
- DEFINES THE NUMBER OF THE STAFF
DECIDES ON ENGAGING THE OTHER COMPANY TO PROVIDE
SERVICES

11. CONTRACTS CONTRACT ON WATER SUPPLY (MUNICIPALITY-UTILITY)
CONTRACT ON SERVICE DELIVERY (UTILITY-CUSTOMERS)
CONTRACT ON PROVIDING THE SERVICES (UTILITY-OTHER COMPANY)
CONTRACT WITH DIRECTOR (UTILITY-DIRECTOR)
CONTRACT ON ESTABLISHING THE UTILITY BY TWO OR MORE MUNICIPALITIES

12. TO DEAL WITH NATURAL MONOPOLY CHARACTERISTIC FOR THIS SECTOR
NATIONAL REGULATOR
TO DEAL WITH NATURAL MONOPOLY CHARACTERISTIC FOR THIS SECTOR
TO PROTECT PUBLIC INTEREST
THE JURISDICTION MAY BE EXTENDED TO OTHER COMMUNAL SERVICES

13. FINANCING-FULL COST RECOVERY
COMMERCIAL BEHAVIOR AND FINANCIAL SUSTAINABILITY
FULL COST RECOVERY
FINANCING THROUGH GRANTS AND LOANS
FINANCING THROUGH REVOLVING FUND
FINANCING TO BE FACILITATED BY THE GOVERNMENT

14. REVOLVING FUND SUSTAINABLE AND STRONG FINANCIAL MECHANISM
INCREASING THE POSSIBILITIES TO ACCESS TO FUNDS

15. REVOLVING FUND-ESTABLISHING
REVOLVING FUND FOR ENVIRONEMENTAL PROTECTION
WATER SUPPLY AND WASTE WATER TREATMENT SERVICES INCLUDED
TO BE ESTABLISHED BY THE LAW

16. REVOLVING FUND-REVENUES
GOVERNMENTAL SUBVENTIONS
FROM INTERNATIONAL ORGANIZATIONS
THROUGH ACTIVITIES OF THE FUND

17. THANKS