LODZ URBAN DEVELOPMENT

Framework Loan to co-finance multi-sector schemes included in the multi-annual investment programme of the City of Lodz in Poland. The project supports the implementation of the City's Sustainable Development Plan for Public Transport by 2025, Study of the Conditions and Directions of Spatial Development of the City of Lodz, Strategy for the Development of the City of Lodz 2030+ and its Action Plan for Adaptation to Climate Change by 2030.

This operation concerns a municipal Framework Loan for urban infrastructure investments in the City of Lodz, Poland. The project will focus on supporting urban mobility schemes, including investments in zero-emission public transport, modernisation of active modes infrastructure (walking and cycling) and improvements to urban roads. The operation also invests in the modernisation of parks and gardens, blue-green infrastructure, urban infrastructure improvements in neighbourhoods and a small investment in water and wastewater schemes. The project will support the implementation of the promoter's Sustainable Development Plan for Public Transport City by 2025, Strategy for the Development of the City of Lodz 2030+ and its Action Plan for Adaptation to Climate Change by 2030.

The Operation contributes to several Sustainable Development Goals and to EU and EIB policies objectives. The Project is aligned with the Climate Bank Roadmap and the Bank's criteria for urban regeneration and integrated urban development and sustainable transport in accordance with the provisions of the EU Urban Agenda, new Leipzig Charter for sustainable urban development, the EU2020 Strategy for smart, sustainable and inclusive growth, the EU Urban Mobility Framework and the EIB Transport Lending Policy. The project will also contribute to Cohesion, Climate Action and Environmental Sustainability Objectives.

The Project addresses a number of market failures that justify the use of public financing to address the investment gap. The Project includes investment in quasi-public goods (e.g. walking and cycling infrastructure, open public spaces such as parks and green areas, public transport) that are expected to generate positive externalities for the city's residents and mitigate negative externalities of road traffic. The cumulative improvements to the urban environment are expected to support better access to services and quality of life for residents. 

The flexible, long-term and attractively priced EIB loan addresses the City's funding needs. It further allows the City to invest its own funds and available EU funding.

The EIB loan will have significant value-added for Lodz due to: (i) its flexibility, (ii) a tenor that matches the economic life of the assets financed, (iii) grace and availability periods that fit the City's expectations and needs, taking into consideration the timeline of operation execution (iv) attractive pricing, and (v) possibility to disburse in PLN. The financing will also strengthen the funding base of the City.

The promoter's environmental management capacity to apply the relevant EU Directives will be verified during appraisal, particularly with regard to EU EIA Directive 2011/92/EU amended by 2014/52/EU, EU SEA Directive 2001/42/EC, EU Habitats Directive 92/43/EEC and EU Birds Directive 2009/147/EC. The status of any environmental studies and public consultations related to the construction and refurbishment investments will also be further assessed during project appraisal. The schemes under the Framework Loan should have an overall positive impact on the environment by promoting sustainable urban development and reducing energy consumption.

The Bank will require the promoter to ensure that contracts for implementation of the project will be tendered in accordance with the applicable EU procurement legislation, Directive 2014/23/EU / 2014/24/EU / 2014/25/EU as well as Directive 92/13/EEC or Directive 89/665/EEC as interpreted by the Court of Justice of the EU, with publication of tender notices in the Official Journal of the EU, as and where required.