Frequently Asked Questions
1. What is the Haiti Reconstruction Fund?
2. How does the HRF operate?
3. How is the HRF governed?
4. Who can request financing from the HRF?
5. Who should I contact to establish a partnership with a Partner Entity
6. Who can contribute to the HRF?
7. How funds flow in the HRF?
8. Is there a minimum contribution amount to the HRF?
9. How can a contribution be made?
10. Is the HRF an efficient and flexible mechanism?
11. Is the HRF the key source of reconstruction finance in Haiti?
12. What are the relations between the Haitan Governement and the HRF?
13. What flexibility does the HRF approach allow in the allocation of funds?
14. How does the HRF ensure transparency, accountability and reduced risk of corruption?
15. How are conflicts of interest avoided?
16. What fees does the HRF charge for projects/programs?
17. What is the lifespan of the HRF?
The Haiti Reconstruction Fund (HRF) is a partnership between the international community and the Government of Haiti (GoH) to mobilize, coordinate and allocate financing for reconstruction following the devastating January 2010 earthquake.
Interested donors are pooling some of their resources into a single fund to finance priority reconstruction projects and programs as well as provide budget support to the GoH. Proposals and final projects must be endorsed by the Council of Ministers and forwarded to the HRF by the Ministry of Planning and External Cooperation. All financed activities are appraised and supervised by Partner Entities that currently include the Inter-American Development Bank, the International Finance Corporation, the United Nations, and the World Bank. Activities are implemented on the ground by the GoH, UN entities, NGOs, the private sector, and other institutions acceptable to a Partner Entity. At the request of the GoH, the World Bank is serving as Trustee and Secretariat of the HRF and transfers resources to partner entities for reconstruction activities at the direction of the HRF’s Steering Committee.
The HRF is governed by a Steering Committee that is chaired by the Haitian Minister of Economy and Finance. The Steering Committee consists of the following members:
a) two representatives of the Government of Haiti (including the Chairperson);
b) a representative from each donor making the minimum contribution to the HRF of USD 30 million;
c) a representative from each partner entity (IDB, IFC, UN, and World Bank); and
d) a representative of the Trustee.
The Government, donor representatives and the Trustee are voting members on financial matters and decision-making is by consensus. The Steering Committee has also invited observers to participate in its deliberations, including representatives of Haitian civil society, the private sector, the diaspora, international NGOs, and local government.
The Steering Committee makes decisions about how HRF funds are allocated and ensures that such allocations are guided by the principles of Haiti's recovery, reconstruction and development needs as defined by the Government. It also reviews the progress of HRF-financed activities as well as the Fund's financial performance. The Steering Committee is supported by a Secretariat based in Haiti.
Any institution that is acceptable to a partner entity can propose an activity for financing through an agency of the GoH. The proponent must work with one of the HRF’s partner entities who will assist with developing and supervising the activity to ensure that international standards are met. Most important, the Ministry of Planning and External Cooperation needs to certify that the activity is consistent with plans for rebuilding and developing Haiti, and the Council of Ministers must endorse the proposal for HRF financing. HRF-financed activities are being implemented by the GoH, UN entities, NGOs, and the private sector. Information on how to obtain funding can be found in the “Grant Approval Process” under the “About the HRF” tab of this website.
Institutions seeking funding from the HRF must work with a Partner Entity. To establish a partnership with one of the Partner Entities, please contact the representative for the relevant Partner Entity as detailed below.
a. Inter-American Development Bank - Mr. Peter Sollis, Haiti Response Group (firstname.lastname@example.org)
b. International Finance Corporation - Mr. Ary Naim, Country Manager (email@example.com)
c. United Nations - Ms. Elisabeth Diaz, Coordination Officer(firstname.lastname@example.org)
d. World Bank - Ms. Michelle Keane, Lead Country Officer (email@example.com)
The HRF can receive contributions from bilateral development and aid entities, foundations and international NGOs that are acceptable to the Trustee. Contributions are made through an administration agreement between the contributor and the World Bank.
Contributions are pooled in a single account held by the Trustee. When an allocation is approved by the HRF Steering Committee, the Trustee transfers funds to a partner entity on the basis of a transfer agreement. The partner entity then disburses funds to one or more implementing agencies to implement the project or program under the partner entity’s supervision.
8. Is there a minimum contribution amount to the HRF?10. Is the HRF an efficient and flexible mechanism?
There is no minimum or maximum contribution. Donors that contribute at least USD 30 million, however, will have a seat on the HRF Steering Committee. Those contributing less than this amount can pool their resources to reach or exceed the threshold in order to obtain a seat, possibly on a rotating basis.
In order to contribute, kindly follow these steps:
a. Send a letter or e-mail to the World Bank indicating interest in participating in the HRF as well as the amount of the intended pledge (c/o Mr. Jonathan Caldicott, firstname.lastname@example.org, 1818 H St. NW, Washington, DC 20433 USA)
b. The HRF Trustee will then send a draft administration agreement for review and signature
c. Sign and return the administration agreement to the Trustee
d. Transfer the initial contribution to the HRF account
The HRF has achieved economies of scale by pooling resources into one fund. It has also reduced transaction costs for the GoH by lowering the number of development partners that it needs to coordinate with. Finally, by adhering to strict performance standards, the HRF has proven itself to be an efficient source of finance. Administrative costs for the Trustee and Secretariat represent less than 1% of total contributions to the Fund. Adding in the project management costs, total fees are still below 5% of contributions. It takes an average of 115 days from receipt of a project concept to transfer of funds to allow implementation to begin.
The HRF is one of many contributors to the process of recovery in Haiti. The UN Flash Appeal mobilized money for the relief effort and early recovery. Multilateral and bilateral donors are another important source of support for different phases of the recovery. Hundreds of NGOs are also key partners in the reconstruction. The HRF is the largest source of flexible reconstruction finance available to the GoH and has mobilized 16% of all reconstruction resources that have been disbursed to date.
The GoH is the driving force of the HRF. All financing requests must be approved and made by the GoH. The Minister of Economy and Finance chairs the HRF Steering Committee and sets its agenda. The HRF Secretariat is co-located with the Ministry of Planning. 89% of funds allocated to date are being disbursed through GoH agencies.
The HRF can be a strategic instrument for the GoH to fill sectoral and geographic gaps in reconstruction financing. Allocation of HRF resources is tailored to the needs of the recovery at any given moment while adhering more broadly to the Recovery and Development Action Plan as well as the National Development Plan. The HRF also allows for dynamic fund management, with funding transferred only when needed, or decommissioning or restructuring if investments are not moving satisfactorily.
All HRF money will flow through one of the three partner entities (Inter-American Development Bank, UN, World Bank). Each partner will apply its own financial management, procurement, environmental/social safeguards, information disclosure, and other procedures to ensure the proper use of funds. The HRF maintains a public website and will post all relevant information there (donor contributions, minutes and decisions of its governing body, financial and progress reports from partner entities, project and program information, complaints handling, key contacts, etc.). Each partner entity is accountable to the HRF Steering Committee when it comes to financial and project performance.
Partner entities do not participate in decision-making concerning the allocation of HRF funds so as to avoid any potential conflict of interest. The World Bank has created institutional firewalls between its roles as Trustee, Partner Entity and host of the HRF Secretariat. The UN has created a similar firewall between its Partner Entity (UNDG) and one of its possible implementing entities (UNDP). All partner entities apply internationally-accepted personnel and procurement procedures to avoid other conflict-of-interest risks.
The Steering Committee of the HRF has approved a fee structure to guide the Partners on appropriate charges for the preparation and supervision of projects and programs supported by the Fund. These fees fluctuate between 1% to 6%, depending on the value of the project (the percentage is lower for larger amounts). For example, the fee charged by the HRF for a stand-alone $35 million dollar project would be $350,000 (1%). It is important to underline that these percentages are guidelines provided by the HRF and that the Steering Committee has the ability to determine a different percentage in cases where there is a compelling reason to do so.
Based on past experience in other post-disaster situations, the HRF was established to provide financing over a seven-year period. Thus, the Fund will be available to mobilize, coordinate and allocate reconstruction financing through the end of 2017.