Local Road Management Manual 239 a. Policy and legal setting. The ifrst step in establishing an EMS is to identify and understand the policy and legal setting in which road projects are implemented. A good understanding of the circumstances surrounding project funding reinforces the assessment and management of the environmental impact of projects and the promotion of environmentally sustainable development; b. Environmental assessment and management planning. Environmental assessment identiifes, predicts, and evaluates all the foreseeable environmental impact of LGU road projects. For speciifc projects requiring a full EIA, the assessment is made by the feasibility study and design teams, whose members must include appropriately skilled environmental analysts; The terms of reference for the study and design works must expressly require an Environmental Assessment (EA), including a thorough investigation of any environmental issues brought to light during the initial environmental assessment. The EA should involve all relevant stakeholders, including the affected community and partner government, the national environment agency, and the local environment agency; The participation of communities that will be affected by proposed road development projects is an important part of the EA, especially if the projects will involve the management of natural resources. Community participation should begin early in project preparation to be most effective, and the EA results should be incorporated into the project design; LGUs can refer to the issues, concerns, and mitigation measures listed in the IEE or EA report when preparing EMPs in consultation with the affected communities. The EMPs will help determine the contractual obligations of the road works contractors; For each identiifed road section, therefore, the LGU must (1) deifne the project baseline, (2) prepare an EMP (to guide the management in monitoring of environmental impact)