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K GLOBAL CROSSROADS Planning & Infrastructure for the California-Baja California Border Region

Lawrence A. Herzog Copyright © 2009 by Lawrence A. Herzog. All rights reserved. No part of this publication may be reprinted, reproduced, transmitted, or utilized in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying, microfi lming, and recording, or in any information retrieval system without the written permission of University Reader Company, Inc.

First published in the United States of America in 2009 by University Readers Inc.

Trademark Notice: Product or corporate names may be trademarks or registered trade- marks, and are used only for identifi cation and explanation without intent to infringe.

13 12 11 10 09 1 2 3 4 5

Printed in the United States of America

ISBN: 978-1-935551-05-8 Contents

Foreword 1

Summary 3

Introduction 5

The California-Baja California Infrastructure Crisis 11

Foreword

he California-Mexico border is the most important global connec- tion that either state possesses. Mexico is California’s largest export Tmarket, and most of California’s trade with Mexico is concentrated in Baja California. Baja California likewise depends critically on trade with the United States, and the California market is the primary consumer of its exports. In recent years, however, two overwhelming factors—security and economic crises—have posed major challenges that undermine cross-border trade and collaboration, in general, between the two states. These challenges, however, present extraordinary opportunities for both California and Baja California to examine the cross-border ties that bind them, and work together to strengthen their global competitiveness. This report, authored by Dr. Lawrence A. Herzog from San Diego State University, identifi es the tremendous importance of the bilateral ties between California and Baja California, and the need for greater efforts and invest- ments to realize their true potential. While trade and commerce between the two states has exploded over the last 15 years, the trade infrastructure of the two Californias has not advanced signifi cantly since the start of the North American Free Trade Agreement (NAFTA). Over time, cross-border trade fl ows have fallen short due to a failure to invest adequately in expanding the necessary infrastructure to maximize volume and effi ciency. Even worse, beginning well before 9/11, extra security provisions at the border have sty- mied the vast majority of legitimate cross-border trade and travel in order to control a minute fraction of illicit cross-border activity. This report provides a clear picture of the current defi ciencies in the infrastructure and planning for cross-border trade between California and Baja California. Yet, more importantly this report identifi es concrete recom- mendations and calls on the leaders and stakeholders of both states to help make our shared border a “global crossroads” that will provide tremendous opportunities for the economies of both states. The Trans-Border Institute (TBI) was founded at the University of San Diego in 1994, at the outset of NAFTA, with the purpose of bringing greater attention to and advancing U.S.-Mexico relations and the border region. Throughout the NAFTA era, TBI has worked to provide information and analysis and promote dialogue and cooperation on a wide range of issues,

1 2 | Global Crossroads

including trade and economic development, rule of law and security, immi- gration, education and cultural exchange, and environmental sustainability. In keeping with these efforts, TBI is pleased to present this report as a means to promote greater cross-border collaboration in advancing the shared eco- nomic and policy goals of both California and Baja California. While studies such as this one provide the necessary facts and fi gures for making more effective policy, there is a critical need to promote dialogue and coordination among policy-makers and stakeholders in order to advance the vision of a more prosperous relationship between California and Baja California.

Dr. David A. Shirk Director, Trans-Border Institute University of San Diego Summary

alifornia and Baja California share the most dynamic portion of the U.S.-Mexico border economy and have tremendous potential to Ctransform their shared border region into an unparalleled “global crossroads.” The border area serves as a giant regional conduit for multi-billion dollar exchange. More than 90% of all goods move by land between California and Baja California. But, this mega-network of cross-border fl ows is faced with a crisis—a transport system (highway, rail, and ports of entry) that can- not adequately absorb the massive volume of people, vehicles, and goods moving north and south over the international boundary. This has led to well documented traffi c congestion, delays, and the perception of uncertainty. According to a San Diego Association of Governments analysis of 2005 trade fi gures, delays in truck crossings at the Otay Mesa and Tecate border cross- ings alone cost the U.S. and Mexico bi-national economy an estimated $6 billion and more than 51,000 jobs. Hence, Mexico’s contributions to California’s economy—while valued at $60–65 billion per year in imports and exports—are hindered by the troubled state of cross-border infrastructure. The California-Baja California border re- gion needs a comprehensive planning approach and a bi-national knowledge base that can bring together stakeholders from all sectors and both sides of the border. A proposed California-Mexico Master Plan may help consolidate the vast array of agencies and border planning efforts on both sides of the border. State offi cials, however, will still need to address the existing funding defi cits for border infrastructure, which will surely be exacerbated by the 2008–2009 budget crisis. Border planning and infrastructure must adapt to the region’s geography and the links to the global economy. The southern border highway system should evolve toward a more north-south pattern; ports of entry (POE’s) need to be expanded, and POE highway connectors enhanced. Rail infrastructure must be upgraded, and seaports better linked to land-fl ow patterns. Large- scale growth poles being created in Baja California—especially the future port at Punta Colonet, and the microchip production center at Silicon Border in Mexicali—need to be incorporated into California’s border master plan.

3 4 | Global Crossroads

Finally, the border’s congestion and inadequate infrastructure are exacer- bated by the post-9/11 shift in federal government priorities toward national security along the border. California and Baja California must work together to better monitor and analyze the supply chain delays and other barriers that hinder California-Mexico economic cooperation and integration. This information will serve in federal-state cooperation in planning infrastructure along the border. Introduction

ince the signing of the North half; imports have more than doubled American Free Trade Agreement during the same period. Since the early S(NAFTA) in 1993, California’s 1990’s and the passage of NAFTA, economic linkages with Mexico have the region has also seen impressive continued to grow. The state exports levels of cross-border growth in the nearly $20 billion annually to Mexico; retail/tourism sector. For example, in the majority of those exports remain San Diego County alone, Mexican within the northern Mexican border visitors spent $2.8 billion a year, by region. Meanwhile California imports recent estimates (SANDAG, 2006). over $45 billion per year from Mexico The steady upward trend in (Shatz and Lopez-Calva, 2004). California-Baja California cross-bor- Some of California’s cross-border der fl ows is mirrored by the strength of economic integration takes the form the larger bilateral economic relation- of merchandise exports. It should be ship between the United States and noted that measuring merchandise Mexico over the last decade. By 2005, exports requires the use of a kind of Mexico had become the second most data that, as the U.S. Census makes important trading partner with the clear, is not always able to distinguish United States (Figure 1).2 California, who the “exporter of record” is and in turn, is the second most important where that exporter is located. For ex- state in the U.S. (after Texas) in terms ample, some of southern California’s of trade with Mexico, with over $41 booming exports are recorded when billion in trans-border surface trade goods in the “maquiladora” (assem- value in 2005 (Figure 2).3 bly) sector pass through the region, The maquiladora sector is the either coming or going.1 Whether critical engine that drives economic these goods are actually produced in integration along the California-Baja California, or destined for markets California border, and thus partly there is not always clear from the defi nes the future of infrastructure data (Feinberg, 2001). strategy in this region. Before global- Nevertheless, the overall magni- ization, cross-border commerce was tude of California-Baja California assumed to be managed with free economic integration is impressive. trade agreements, currency market Exports to Mexico have steadily decisions, trade and fi scal policies increased over the last decade and a made in the national capitals, or

5 6 | Global Crossroads

Figure 1 U.S. Exports of Domestic Merchandise, 2001–2005

200,000

180,000

160,000

140,000

120,000 2001 Dollars  2002 US  100,000 of  2003 2004 80,000 Millions 2005

60,000

40,000

20,000

0  China  Japan  United Korea  France  Canada Mexico Germany Kingdom Taiwan Malaysia

Country

Source: U.S. International Trade Commission, Mexico–U.S. Trade data. corporate sourcing decisions made advantage in the global economy and in the private sector. But, in an era fortify themselves against competing of globalization, state and regional regions (Herzog and Erie, 2002). The governments must take the lead in urbanizing California-Baja California crafting cross-border infrastructure border region fi ts this new class of policy (Lowenthal, 2009). Regions entrepreneurial regions. But it must must reinvent themselves as mul- plan and manage infrastructure in timodal transportation centers a way that fully embraces the trans- speeding the fl ow of people, goods, boundary geographic and global eco- information and fi nance throughout nomic realities of the border zone. the world economy. In particular, The border zone—southern rapidly urbanizing regions that build California and northern Baja world-class transportation infra- California—is the primary regional structure strengthen their competitive “conduit” for the California-Mexico Introduction | 7

economic exchange. The most tangible movements, exacerbated by measure of this conduit function is the post-9/11 federal homeland immense network of fl ows—people, security policy; vehicles and merchandise—between d. Lack of a comprehensive re- Mexico and California. For example, gional infrastructure policy for 35 million vehicles cross the California the California-Baja California border from Mexico each year; they border region; carry between 65 and 70 million e. Absence of a policy and plan- passengers. Meanwhile two million ning mechanism at the state trucks carry nearly 30 billion dol- (and regional) levels that lars of merchandise. These fl ows are fully integrates Baja California forecast to double by the year 2020 developments and plans into (CALTRANS, 2006). This zone also infrastructure decisions on the houses a steady stream of legal cross California side of the border. border fl ows of labor into the state.4 Despite the burgeoning of cross- The costs of delays, ineffi cient process- border trade between California and ing, overzealous Homeland Security Mexico, the future of the California- policies or inadequately planned high- Mexico economy will increasingly be way networks and ports of entry to mediated by the quality, scale, and the California-Baja California border effi ciency of transport and ports of en- economy are diffi cult to accurately try. This report seeks to synthesize and assess, due to explore policies and plans for border the complex- 35 million infrastructure in light of the current ity of fl ows vehicles cross the obstacles facing cross-border infra- along interna- structure. Those obstacles include: tional borders. California border However, at from Mexico a. Traffi c congestion and border least some of each year; they delays generated by greater the costs are carry between 65 volume of cross-border fl ows of literal and and 70 million people, vehicles, and products; estimates can passengers. b. Inadequate regional transport be projected, infrastructure (port facilities, though even highways, rail, etc.) necessary they are, at to house the larger fl ows that best, rough estimates. There is cer- accompany rising California- tainly no doubt that the infrastructure Baja California economic fl aws are severely damaging the state integration; economies of both California and c. Delays and uncertainties in Baja California. According to a San the processing of cross-border Diego Association of Governments 8 | Global Crossroads Millions)  (US $  Value  Trade  Surface 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 York Ohio  Texas Illinois Indiana Arizona C arolina  Michigan C alifornia New Top 10 States Trading with Mexico, by Surface Modes of Transportation in 2005 Transportation Surface Modes of by with Mexico, Trading 10 States Top Tennes s ee

North

e o c i Mex  with  Trading  States  10  Top Surface Freight Dataset. Transborder BTS Figure 2 Source: Introduction | 9

(SANDAG) study of border delays reviews the challenges facing planners that is discussed later in this report, and decision-makers in crafting in- delays in truck crossings at the Otay frastructure policy in the future. The Mesa and Tecate ports of entry cost methodology is anchored by a critical the California economy an estimated analysis of archival sources, includ- $716 million in annual output and ing formal plans, agency reports and more than 3,600 jobs. The impact is consulting studies, academic papers even greater in Baja California, which and studies, as well as media reports. experiences an estimated loss of Selected anecdotal interviews with $1.317 billion in annual output and experts and policy makers on both 6,929 jobs due to the truck crossing sides of the border were carried out delays in Otay Mesa and Tecate. Yet to to corroborate secondary documents focus only at the state level misses the when necessary. point, since both California and Baja California are vital trade conduits for both Mexico and the United States. At the national level, the impacts of border delays amount to more than $6 billion dollars in lost revenue— and over 51,000 lost jobs—in both countries. However one might debate its exactness, the multi-billion dollar fi gure hints at the gargantuan scale of the problem. The fi gure is expected to more than double in the next 10 years if no major changes in infrastructure are made (SANDAG, 2006). This report analyzes the dimensions of the border infrastructure crisis along the California-Mexico bound- ary in the context of a region that has increasingly globalized in the last decade, and requires an infrastructure more fully designed for its global and bi-cultural character. It then explores the nature of existing policy-making and decision structures. It suggests some key elements of an improved transport and infrastructure network in the cross-border region. Finally, it

The California-Baja California Infrastructure Crisis

he California-Baja Cali- Maquiladora factories, also called fornia borderlands network “maquilas,” are the third largest Tof highways, rail transit, and source of foreign revenue in Mexico, ports of entry (POE) is an infrastruc- generating a value-added estimated at ture in crisis. The infrastructure crisis $20 billion per year, with more than has eight critical dimensions: three fourths of that embedded along the northern border. In 1978, there were 178 maquilas in Baja California; 1. Economic Growth/ Demographic Change Demographic expansion and eco- Table 1 Population of California- nomic development are producing Baja California Border cross-border fl ows of goods, people, Counties/Municipalities and vehicles at levels that existing infrastructure simply cannot absorb. 2006 An estimated six million people live San Diego 2,941,454 along the 150 mile border California Imperial 160,301 shares with the Mexican state of Baja 5 California (see Table 1). By 2030, 2005 9 or 10 million people will reside Tijuana 1,410,687 in the two California counties (San Diego, Imperial) and fi ve Mexican Rosarito 73,305 municipalities (Tijuana, Rosarito, Ensenada 413,481 Tecate, Ensenada, Mexicali) along Tecate 91,034 this border.6 Mexicali 855,962 This demographic explosion Total Baja 2,844,469 around the California-Baja California Total CALIF/ 5,946,224 border is interwoven with the expan- BAJA Border sion of the cross-border economy. The exchange of goods across the Source: U.S.: U.S. Census Bureau, Census of Population land border is, in turn, profoundly and Housing, Population Estimates, 2006. Mexico: infl uenced by the galvanizing role of INEGI (Instituto Nacional de Estadistica, Geografi a the maquiladora sector, which relies y Informacion), Conteo de Poblacíon y Vivienda, on assembly production for export. Informatica, Vivienda, 2005.

11 12 | Global Crossroads

Table 2 California Exports To Mexico (In Thousands $U.S.)

State 2001 2002 2003 2004 2005 2006

U.S. Total 101,509,075 97,530,613 97,457,420 110,775,285 120,048,914 134,167,083

California 16,343,059 16,076,279 14,871,836 17,239.379 17,702,502 19,632,985

California 16.1% 16.5% 15.3% 15.6% 14.7% 14.6% % of U.S. Total

Source: Offi ce of Trade and Industry Information (OT11). Manufacturing and Services, International Trade Administration, U.S. Department of Commerce.

by 2006, the number was 900, a equipment repair, food production, 400% increase (CALTRANS, 2006). and cleaning services.7 Beyond trade, The assembly Mexico’s impact on California in- Demographic industryi gener- cludes remittances sent by workers atesa multiplier back to Mexico, Mexican-owned expansion effectse to the residential real estate, and foreign and economic tunet of bil- direct investment.8 development are lionsl of dollars California exports to Mexico producing cross- acrossa sectors (Table 2) grew from $16.3 billion border fl ows of anda on both in 2001 to $19.6 billion in 2006. goods, people, sidess of the Following 9/11 and tighter security California-C at the border, exports dipped for two and vehicles at BajaB California years, but by 2004, they began to levels that existing border.b surge once again. infrastructure MultiplierM ef- More than two thirds of California’s simply cannot fectsf include exports (some 70%) go to Baja absorb. numerousn California (Tomas Rivera Institute, “backward“ 2005). The leading export commodi- anda forward” ties from California to Mexico are linkage activities, from real estate, computers, electronics, and machin- fi nancing, and insurance to retail, ery, which account for about 50% The California-Baja California Infrastructure Crisis | 13

Figure 3 California Exports to Mexico by Sector (2002)

Computerandelectronicproducts

17% Machinery,exceptelectrical

Foodandkindredproducts

3% Fabricatedmetalproducts 39% 3% Plasticsandrubberproduction

4% Chemicals

4% Transportationequipment

Electricalequipment,applicance,and 5% components Paper 5% Apparelandaccessories 5% 11% 4% Otherindustriescombined

Source: U.S. Census Bureau’s Foreign Trade Division. of all California products exported border infrastructure was “sized for a to Mexico (see Figure 3). These are much smaller and radically less secu- also, as mentioned, the main sectors rity-conscious economy” (SANDAG, of the border maquiladora economy. 2006). California has only 6 border The maquiladora sector, along with crossings to absorb 34–40 million retail trade and tourism, embodies passenger vehicles, 2 million trucks, the increasing globalization of the and 18–20 million pedestrian cross- California-Baja California border ings per year (US Department of economy and, as such, is tied to larger Transportation, 2006). Cross-border global economic trends.9 fl ow increases, over the last decade, The cumulative effect of larger have ranged from 37% growth populations on either side of the in truck crossings to 25% in pas- border, and a surge in the volume of senger vehicles (U.S. Department of goods in transit north and south of the Transportation, 2006). At the same California-Baja California border has time, comparatively modest changes left existing facilities overwhelmed. in border infrastructure were made in In the words of the landmark 2006 response. For example, no large-scale study of border wait times, California initiative has been made to expand rail 14 | Global Crossroads

infrastructure along the California- million trips into San Diego are lost Baja California border. Less than one annually with a corresponding loss of percent of all the rail-based trade an estimated $2.5 billion in potential between the U.S. and Mexico fl ows revenues in the San Diego region, through California (Haveman and mainly in the retail sector. The study Hummels, 2004). Further, as noted also estimated that Baja California below, north-south highway expan- loses more than 2 million trips per sion, though badly needed, is by no year, resulting in a loss of approxi- means guaranteed under current mately $120 million in revenues and budget conditions. $100 to $230 million in total output. Delays in getting trucks carrying freight across the California-Baja 2. The Economic and Environmental California border, due to nearly two Costs of Border Delays hours of processing time, signifi cantly Longer wait times at the border have impede productivity, competitiveness, clear costs—both economic and and regional/national business. The environmental. Attempts to measure SANDAG model projected a San the economic costs of California-Baja Diego County-wide annual impact California border delays follow from of nearly one half billion dollars in previous efforts to chart the costs of lost revenue. In Baja California, the border wait times along the Canada- projected annual impact was signifi - U.S. border.10 Studies in the northern cantly higher, with a projected annual border region focused on lost pro- loss of $1.317 billion in lost output. ductivity, industry competitiveness, This does not include long-term im- and loss of revenue. They calculated pacts of relocation of industries away losses ranging from $7.5 to $13.5 from the border region due to the billion/year due to delays in trucks problems of moving freight. Overall, carrying merchandise trade. the study found that more than a one The economic costs along the hour wait time at the border was California-Baja California border considered “excessive” and would were measured in SANDAG’S 2006 decrease company profi ts. During the study of cross-border wait times. time of the study, waiting times for That study found delays at the San the sample of 120 companies were Ysidro, Otay Mesa, and Tecate between two and three hours. This crossings experienced on two levels: left many companies experiencing loss of cross-border personal travel psychological uncertainty about the and in cross-border freight delays. border economy, as well as real losses SANDAG’s economic model analyzed in dollars, whose overall net value more than 3,600 surveys of border was nearly $6 billion in 2005, as crossers and deduced that over eight mentioned previously. The California-Baja California Infrastructure Crisis | 15

Increased delays along the border These trucks carry $30 billion in also have environmental impacts, freight, with about 60% of the freight especially in the area of truck emis- crossing from Mexico into California sions. Heavy duty trucks utilize diesel destined to one fuel, and are the main vehicles that of California’s Increased move freight back and forth across counties. A delays along the the California-Baja California border. recent survey Studies have shown that idling trucks of truck desti- border also have burn greater amounts of diesel fuel, nations shows environmental leaving many toxic contaminants in that the vast impacts, especially the air, including carbon monoxide, majority of in the area of nitrous oxides, sulphur dioxide, loaded trucks truck emissions. and particulate matter. These emis- crossing over sions have been linked with diseases the Mexican and health problems like asthma, border into California go to Los heart conditions, and cancer. The Angeles, San Diego, San Bernardino, Environmental Protection Agency Orange, Imperial, and Riverside has recognized this problem along the counties—in short to the major Mexican border (U.S. Environmental markets of southern California (See Protection Agency, 2007). Figure 4). This suggests that north- south highway corridors connect- ing southern California with Baja 3. Inadequate Highway California will continue to receive Trade Infrastructure larger shares of vehicles moving Southern California’s low density south-north. However, as this report urban structure means its surface notes further on, highway infra- transportation is essentially highway- structure in southern California has oriented. California’s $60–65 billion historically favored east-west, rather trade relationship with Mexico is than north-south, fl ows. currently transacted almost entirely Closer to the border itself, truck by truck/road transport. About 98% crossings are causing congestion of all trade through California’s at both the ports of entry and ports of entry occurs by truck. along the highways that link to the In 2004, some 1.4 million trucks POE’s. Recognizing this, the U.S. crossed at the Otay Mesa crossing in Department of Transportation’s southeastern San Diego County and 2004 Border Infrastructure Needs another .6 million at Calexico East. Assessment (BINS) report for the Truck crossings are likely to increase State of California calculated a to nearly six million trucks by 2030 demand for 103 new border zone (CALTRANS, 2006). highway construction projects worth 16 | Global Crossroads

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$12.9 billion needed by 2030. Of highway infrastructure improve- that amount, only 22 projects at a ments through 2030, yet only $923 cost of $2.6 billion were identifi ed million was proposed for border rail as fully funded. This left a defi cit in upgrades in the same time period. border highway infrastructure of 81 Of those border rail upgrades, three projects, and a fi nancial vacuum of out of seven proposed projects were $10.3 billion in unfunded highway unfunded, leaving more than a $100 needs (Sourcepoint, 2004). million defi cit for rail transport (Sourcepoint, 2004). The advantage of rail crossings 4. Poorly Developed Rail Linkages is that they are more fi xed in space California rail infrastructure linkages and become central infrastructure with Mexico are underdeveloped. The hubs that at- movement of goods between Baja tract ancillary While two California and California is dominated activities—like by truck transit. While two million warehousing million trucks trucks enter California from Mexico, and manufac- enter California only 18,000 rail containers come in. turing—which from Mexico, Texas, by contrast, receives 240,000 would benefi t only 18,000 fully loaded rail containers per year both sides of rail containers (mainly through Laredo), and even the border. come in. Texas, Arizona’s port of Nogales is a more This creates important rail facilitator than any in more positive by contrast, California. While it might be argued economic receives 240,000 that Texas and Arizona are more po- spillover ef- fully loaded rail sitioned in the center of the “NAFTA fects and can containers per year. corridor” of goods fl owing from cen- generate local tral Mexico into the heartland of the catalysts for U.S. market, this underestimates the economic growth. Truck crossings, strategic importance of the California on the other hand, are more spread land gateway to the major cities and out and footloose, and therefore less ports on the west coast (Vancouver, appealing in the long term since they Seattle, San Francisco/Oakland, Los do not create geographically concen- Angeles), and to the larger possibilities trated economic growth pole effects of linking by land those ports to global (Haveman and Hummel, 2004). trade corridors in the Pacifi c Rim. The problems with California- The bias toward highway rather Baja California rail infrastructure are than rail funding is illustrated in the manifest by the current geography 2004 BINS assessment report. $12.9 of railroads in the California-Baja billion was proposed for cross-border California border region (Figure 5). 18 | Global Crossroads POE POE 8 78 2 5 IMPERIAL COUNTY POE 115 POE 111 RIVERSIDE COUNTY U.S.A. U.S.A. MEXICO 86 MEXICO CALIFORNIA CALIFORNIA BAJA CALIFORNIA BAJA BAJA CALIFORNIA BAJA 78 2 8 74 SAN DIEGO COUNTY 79 POE 94 79 76 POE 94 67 52 POE 5 1-D 15 56 163 805 78 76 Railways in the California Border Region in the California Railways 5 Union PacificUnion Burlington NorthernSanta Fe SanArizona Diego Eastern& Railroad MexicoNational of POE (Port of Entry) of (Port POE U.S. Interstate Highways Routes State California Mexico Highways RoadsMexico Major U.S. MajorRoads

74 Pacific Ocean Figure 5 The California-Baja California Infrastructure Crisis | 19

At present, the rail network is defi ned is that it is not fully realizing its by a corridor of rail linkages running potential as a national gateway for from Mexicali-Calexico through U.S.-Mexico trade. While California southern Imperial County, crossing has a vital $60–65 billion economic the border at Tecate, and then travel- relationship with Mexico, and also ling across the mountains south of the with Latin America, its land gateways border, fi nally reentering California have not played as large a role in han- near San Ysidro, and then linking to dling global merchandise trade as they the coastal rail line that runs from San might. Nationally, the most important Diego to Los Angeles. This rail system land ports for North American trade is composed of a series of separate rail- are either on way entities [Union Pacifi c, San Diego the northern California’s two and Arizona Eastern, Burlington border with largest land ports Northern Santa Fe (Figure 5)]. The Canada, main- National Railroad of Mexico link ly Michigan, for handling trade begins in the State of Sonora, crosses (over $150 bil- goods combined into Baja and then into California at lion worth of for only about the Calexico-Mexicali port of entry. merchandise) $29 billion, out From there, it links to a series of and the New of $541 billion different sub-systems referred to in York border in international the aggregate as the San Diego and ($70 billion), Imperial Valley line (SDIV). or along the trade for the This system is strained by several Texas border entire U.S. factors. First, it is a fragmented sys- ($140 billion). tem with too many separate compa- California’s nies trying to connect into a single two largest land ports for handling cross-border line. Second, it is a line trade goods combined for only about that crosses back and forth from $29 billion, out of $541 billion in in- the U.S. to Mexico and back into ternational trade for the entire U.S.11 the U.S. Third, there are geographic California’s historic ties with and topographic barriers—canyons, Mexico, its robust economy, and its mountains and gorges—that make large Mexican and Latino immigrant the line expensive to upgrade. population would appear to give it a natural advantage in cross-border trade with Mexico. Recent data sug- 5. Lost Opportunities for Land gest that these advantages have not Gateways in Cross-Border Trade: reaped corresponding benefi ts for the California vs. Texas state. California lags substantially Another problem with California- behind Texas in U.S.-Mexico trade Baja California’s border infrastructure and cross-border fl ows. 20 | Global Crossroads

Data on cross-border fl ows of Mexico crosses the Texas border, commercial trucks from 2000–2003 mostly through the Laredo gateway. (Table 3) reveal that each year nearly Several elements explain the current three times as many trucks (2.8 pattern of Texas domination of cross- million/year) crossed at the Texas border trade. As mentioned, the Texas border, as opposed to the California border is geographically positioned border (about 1 million/year in the to facilitate the cross-border fl ow of same time period); both states have goods toward the Eastern U.S. and seen signifi cant increases since then.12 the Midwest. Texas lies directly along California has only two signifi cant the “NAFTA corridor,” a line which truck cross- runs through Mexico’s industrial Less than 1% of ingi ports of center and north, across Texas, and all goods traded entry—Otaye north into the center of the United MesaM and the States. California’s location on the by land with newn crossing western edge of North America puts Mexico cross the ata Calexico it at a distinct continental geographic California border East.E Texas, on disadvantage—in terms of the loca- by rail; meanwhile thet other hand, tion of markets for Mexico and U.S. about 90% of all hash substantial trade goods. rail trade with truckt crossing A second important factor lies in facilitiesf at 4 the current dominance of Houston Mexico crosses portsp of entry. as port of embarkation for Mexican the Texas border, ThoughT Texas exports to Asia. California does not mostly through hash a longer presently have a major port that the Laredo border,b and is handles the Mexico/Asia export sec- gateway. geographicallyg tor. This could substantially change in betterb situated the future with the development of a tot move goods major export port at Punta Colonet, directlyd into south of Ensenada, discussed in a later U.S. markets, California’s border section of this report. The expected infrastructure, given the size of the construction of a new deep water port state’s economy, still seems propor- at Punta Colonet over the next fi ve tionally weaker than it should be. years could dramatically restructure When one tracks the fl ow of trade the fl ow of Mexican goods through goods moving by rail, an even more U.S. land borders, favoring California pronounced contrast emerges (see over Texas. Still another important Table 4). Less than 1% of all goods factor is that most of the incoming traded by land with Mexico cross the California trade merchandise from California border by rail; meanwhile Mexico arrives by truck. In 2003, about 90% of all rail trade with (see Table 4) the state of California The California-Baja California Infrastructure Crisis | 21

Table 3 Incoming Truck Crossings, U.S.-Mexican Border (Arizona, California, New Mexico and Texas), 2000–2003

Port Name 2000 2001 2002 2003 Arizona, Total 344,265 336,090 311,907 313,250 Douglas, AZ 33,594 31,520 24,362 26,122 Lukeville, AZ 3,840 4,357 1,552 821 Naco, AZ 9,137 8,949 4,078 3,643 Nogales, AZ 254,694 249,237 242,237 243,365 Sasabe, AZ 2,652 1,995 2,007 1,324 San Luis, AZ 40,348 40,032 37,671 37,975 California Total 1,031,546 1,027,815 1,067,411 1,019,908 Andrade, CA 1,517 1,767 2,075 2,253 Calexico, CA U U U U Calexico East, CA 278,811 256,715 276,390 261,140 Otay Mesa/San Ysidro, CA 688,340 708,446 731,291 697,152 Tecate, CA 62,878 60,887 57,655 59,363 New Mexico, Total 36,491 32,216 32,603 33,263 Columbus, NM 4,545 4,396 4,652 4,589 Santa Teresa, NM 31,946 29,830 27,951 28,674 Texas, Total 3,113,277 2,906,838 2,014,672 2,871,624 Brownsville, TX 299,238 251,613 248,869 229,389 Del Rio, TX 61,228 59,942 72,039 65,609 Eagle Pass, TX 106,892 87,658 89,856 88,272 El Paso, TX 720,406 660,583 705,199 659,614 Fabens, TX 214 108 NA NA Hildalgo, TX 274,150 368,395 290,282 406,064 Laredo, TX 1,493,073 1,403,914 1,441,653 1,354,229 Presidio, TX 8,734 7,104 6,605 5,720 Progreso, TX 12,001 19,844 23,886 19,571 Rio Grande City, TX 24,065 25,724 26,330 35,523 Roma, TX 13,276 11,953 9,953 7,633 U.S.–Mexico Border Total 4,525,579 4,304,959 4,426,593 4,238,045

Source: Offi ce of Trade and Industry Information (OT11). Manufacturing and Services, International Trade Administration, U.S. Department of Commerce. 22 | Global Crossroads

Table 4 Incoming Rail Container (Full) Crossings, U.S.–Mexican Border (Arizona, California, New Mexico and Texas), 2000–2003

Port Name 2000 2001 2002 2003 Arizona, Total 25,249 35,716 31,789 24,602 Douglas, AZ NA NA NA NA Lukeville, AZ NA NA NA NA Naco, AZ NA NA NA NA Nogales, AZ 25,249 35,716 31,789 24,602 Sasabe, AZ NA NA NA NA San Luis, AZ NA NA NA NA California Total 1,565 2,243 2,104 1,193 Andrade, CA NA NA NA NA Calexico, CA U 30 U U Calexico East, CA 1,398 908 460 950 Otay Mesa/San Ysidro, CA 167 2 9 11 Tecate, CA NA 1,303 1,635 232 New Mexico, Total NA NA NA NA Columbus, NM NA NA NA NA Santa Teresa, NM NA NA NA NA Texas, Total 239,421 228,613 235,657 240,674 Brownsville, TX 13,363 7,560 7.838 9,992 Del Rio, TX NA NA NA NA Eagle Pass, TX 40,898 16,237 15,390 11,996 El Paso, TX 10,721 17,337 18,364 21,002 Fabens, TX NA NA NA NA Hildalgo, TX NA NA NA NA Laredo, TX 174,439 187,479 194,065 197,684 Presidio, TX NA NA NA NA Progreso, TX NA NA NA NA Rio Grande City, TX NA NA NA NA Roma, TX NA NA NA NA U.S.–Mexico Border Total 266,235 266,572 269,550 266,469

Source: U.S. Department of Transportation, Bureau of Transportation Statistics. The California-Baja California Infrastructure Crisis | 23

handled only 1193 full container rail These are discussed in more detail crossings; in that same year, Arizona later in this report. had 24,606 container crossings (at For the maquiladora economy at Nogales), while Texas had 240,674 the border, component parts from Asia (at Laredo, El Paso, Eagle Pass). are trucked in from the Los Angeles/ Long Beach port complex. Finished products are then trucked back across 6. Other Lost Opportunities: the border to Southern California vs. Other destinations Regional West Coast Regions within a 500 The southern California cross-border mile radius, infrastructure region also lags behind other west e.g. San Diego, planning needs coast regions both in infrastructure Los Angeles, to be more capacity and expansion plans. the Bay Area, closely linked Building upon already extensive port, Phoenix, and to cross-border rail and airport facilities, other trade Las Vegas. As development centers are engaged in massive expan- mentioned sion programs. From 1996–2000, the above, nearly priorities. Los Angeles region spent $4.3 billion, 90 percent the Bay Area $3.2 billion and Seattle/ of the north- Tacoma $1.5 billion on port, rail, bound freight that originates in and airport development to increase Mexico is carried by trucks. Obviously, Pacifi c Rim trade. By contrast, the land border crossings will continue to San Diego/Tijuana border region’s play a key role in the southern border capital spending on such projects was region’s economy.13 less than $400 million (Herzog and Erie, 2002). Regional infrastructure planning 7. Ports of Entry: needs to be more closely linked to Quantity and Quality cross-border development priorities. California currently has six ports of Not until 2004, did any system- entry into Mexico (see Figure 6). They atic studies of regional infrastructure include San Ysidro (24 northbound needs along the border appear. Since vehicle gates, 6 southbound gates), then two important works fi nally Otay Mesa (12 northbound, 2 south- began to address this problem. They bound gates), Tecate (2 northbound, include the bi-national Border 2 southbound gates), Calexico (4 Infrastructure Needs Assessment northbound, 2 southbound gates), Study (BINS) (Sourcepoint, 2004) Calexico East (8 northbound, 2 and the California-Baja California southbound gates), and Andrade (1 Border Report (CALTRANS, 2006). northbound, 1 southbound gate). 24 | Global Crossroads

The two landmark infrastructure to the POE’s at Tijuana, Mexicali, reports on this region have both Tecate and Algodones (CALTRANS, emphasized that these facilities can 2006). The earlier BINS report also handle neither the current volume concluded that “current transporta- nor future forecasts of fl ows of tion infrastructure was not designed people, vehicles and goods across the to handle the large NAFTA traffi c California-Baja California border. volume.” It proposed building sev- The CALTRANS comprehensive 2006 eral new ports of entry (Sourcepoint, border report points to increased wait 2004). times and congestion for both pas- There are not enough gates or senger and commercial vehicles as the inspectors for handling commercial central policy issue facing transport trucks, passenger vehicles, bicycles, infrastructure along the California- and pedestrians. Increasing wait Baja California border. As mentioned times and congestion have led to earlier, it cites forecasts showing that loss of income, jobs and a climate fl ows will double in the next decade of uncertainty about California- or so. To remedy this, $1.6 billion in Baja California trade in the future. transportation upgrades is called for In their future remodeled forms, all in the report, of the ports of entry, especially the Increasing includingi ex- largest facilities—at San Ysidro/ pandedp north/ Tijuana, Otay Mesa/Mesa de Otay, wait times and souths and east/ and Calexico-Mexicali—also need to congestion have westw highways factor in the tradeoffs between larger led to loss of ini San Diego fl ows, and the changing politics of income, jobs anda Imperial homeland security. and a climate of County,C im- uncertainty about provedp and remodeledr 8. The Friction of Homeland California-Baja portp of entry Security California trade facilities,f in- No region in North America was more in the future. cludingc added impacted by the events of September truckt routes, 11, 2001 than the U.S.-Mexico anda at least border region. Prior to the World two new POE’s at Jacumba and Otay Trade Center tragedy, the buzzwords Mesa East. The study also outlined of the U.S.-Mexico border were $514 million needed for transport “global market.” The California-Baja infrastructure improvements around California border region was in a the ports of entry on the Mexican boom mode in the 1990’s, building on side, including remodeled ports of the growing NAFTA-driven economic entry and better road connections connections. Along its most urbanized The California-Baja California Infrastructure Crisis | 25

sector—the San Diego/Baja border— This stands in marked contrast to government and private interests were the previous decade of the 1990’s, teaming to launch a set of ambitious where “economic development” had construction projects aimed at creat- become the overarching theme in ing stronger cross-border ties to Baja U.S.-Mexico California. Trans-border highways, relations and On many levels, rail systems, and even airports were the border. On the formation on tap for the new millennium. State many levels, the and local planning agencies were formation of a of a cabinet altering their master plans to support cabinet level level security building infrastructure needed to as- security agency agency like DHS sure the huge foreign trade revenues like DHS has has created a forecast for the region.14 created a seri- serious obstacle September 11, 2001 stopped much ous obstacle to the social of this optimism in its tracks for the to the social next several years, and one can argue and economic and economic the subsequent shift in border zone circulation sys- circulation system federal policy remains in place. Instead tem along the along the U.S.– of new highways and border gates, a U.S.-Mexico Mexico border. “wall” of heightened security wedged border. From a itself between California and Mexico. policy-making The formation of the Department of perspective, Homeland Security (DHS) as a cabi- then, DHS must be viewed as an net level agency, consolidating the ef- indirect, but potentially formidable forts of immigration, customs, border drain on California’s future economic inspection, transportation security, growth. the border patrol, and maritime secu- Several micro-level examples along rity, marked a watershed moment in the California-Baja California border 2001–2002. It signaled the emergence illustrate the confl ict between security of “security” as the primary objective and the economic needs of border in the management and organization crossers in the region: of the border zone, and the myriad facilities within its jurisdiction.15 DHS acknowledges the role of in- i. Bicycle lanes and frastructure and the use of technology pedestrian walkways in making border crossings more ef- In the spring of 2002, DHS (through fi cient.16 However its primary impact INS and Customs) announced the has been to inject “national security” closing of the bicycle lane at the as the operating federal policy “para- San Ysidro, California crossing. The digm” for the U.S.-Mexico border. bicycle lane had been adopted as a 26 | Global Crossroads

healthy community response to the Both of these cases illustrate an daily post-September 11 logjam of essential problem with DHS policy- vehicles and pedestrians at the port making: concerns over security from of entry. INS claimed that the bicycle the perspective of Washington, D.C. lane was dangerous. Critics argued are overshadowing the daily journeys that the federal agencies had done no to work, shop, or visit friends and fam- studies to look for alternatives that ily by boundary crossers who occupy would allow an autonomous bike the life spaces of the border zone. lane to exist. Rep. Bob Filner (D-San Diego) told the press “Why close out the only option without an alterna- ii. The border fence project tive?” He went on to say: “The INS is A proposed DHS “Border Fence like a bunch of Keystone Kops. They Project” planned for some fi ve miles of have no idea what they are doing and the boundary in San Diego offers an- no notion of what the community other example of the confl ict between wants” (Herzog, 2002). border security and economic/social The bicycle lane was eventually reality. In 2003, several design plans restored by INS, but it was moved for a future fence along the western inside the U.S. customs building, thus boundary of the San Diego/Tijuana occupying space used by pedestrians. border were presented to DHS. DHS In 2006, the special bicycle lane was selected the “triple fence” option, a eliminated entirely. The government version that would insert a militarized claimed it was closing the bicycle lane zone in a preserved ecological sanctu- because people were renting run-down ary. A triple fence would be heavily bikes at the border for a few minutes, lit at night with an invasive, oversized just to save time. Cyclists now have paved road running through the cen- to wait in line with pedestrians. ter. It would create a federal security A second change in border cross- corridor, patrolled by jeeps, vans, and ing policy at the local level occurred other heavy vehicles, in the heart of in 2007, when Customs and Border rare marshlands and sand dunes, and Protection announced that it would near the gathering places of some close the main pedestrian bridge of North America’s most diverse at San Ysidro, where over 20,000 wildlife, particularly migratory birds. pedestrians cross per day. This will This project was rejected by the State mean that those pedestrians will be of California’s Coastal Commission forced to walk almost one mile more, because it would “do more harm and probably impede the fl ows of than is necessary to the environment” cars, buses, and taxis in the already (Rodgers, 2003). congested San Ysidro crossing zone. The California-Baja California Infrastructure Crisis | 27

iii. Port of entry plans and policies and powerful private interests. The In 2003–2004 DHS created “U.S. Mexican government is set on having Visit,” a new federal strategy to screen the southbound U.S. highway enter not only incoming visitors to the Mexico in the El Chaparral zone. The U.S., but all people leaving the United San Ysidro community vigorously States at different ports of entry. The opposes the three options that favor idea was to monitor both incoming moving facilities to the west; San and outgoing fl ows of people, to Ysidro favors keeping the infrastruc- better control the nation’s borders. ture where it currently is, and simply For San Ysidro, this would mean the expanding existing facilities and creation of a southbound checkpoint spaces. Further, the fi nal approved facility for screening outgoing cars POE design is extremely unfriendly and pedestrians. Such a facility would to pedestrians. Under the proposed quickly strain traffi c circulation at the plan, pedestrians reentering the U.S. San Ysidro-Tijuana border. A security from Tijuana at the San Ysidro cross- check in that location would generate ing would be required to walk more daily waiting lines up to a mile long, than one mile through a series of creating local bottlenecks within San checkpoints and screening facilities, Ysidro and increasing air pollution. until they fi nally arrive at San Ysidro The heavily Latino community of on the U.S. side (Wei, 2007). San Ysidro would be burdened with another planning crisis. This is one example of a range DEVELOPING A CROSS-BORDER of land use and design changes that INFRASTRUCTURE STRATEGY were never suffi ciently aired within California and Baja California need the community (Casa Familiar, a comprehensive cross-border ap- 2004). Yet another example lies in the proach to infrastructure. It should proposed realignment of the freeway incorporate three central elements: around the border crossing. Four fi - stakeholders, planning processes, and nal options were offered for the port the region’s bi-national connection. of entry (POE) expansion land use plan. Three of the options favored moving San Ysidro’s southbound a. Stakeholders entrance to the west, so that it would The fi rst step in developing a cross- connect with a future development border infrastructure strategy is to site on the Mexican side called El identify and better understand who Chaparral. Interviews revealed that the stakeholders are. Table 5 offers El Chaparral is a big development a working breakdown of the princi- site involving several federal agencies pal stakeholders in California-Baja in Mexico, and a number of wealthy California cross-border infrastructure 28 | Global Crossroads

Table 5 California-Mexico Border Infrastructure: Stakeholders List

United States México LOCAL LOCAL • SANDAG • Instituto Muncipal del Planeación • City of San Diego (IMPlan), Tijuana • City of Chula Vista • Ayuntamiento de Tijuana • County of San Diego • Comité de Planeación y Desarrollo • Metropolitan Transit System (MTS) Municipal (COPLADEM) • San Diego County Regional Airport Authority • (IMIP) Instituto Municipal de • San Diego County Water Authority Planeación, Mexicali • City of Tecate • Ayuntamiento de Mexicali • City of Calexico • Ayuntamiento de Tecate • County of Imperial • IVAG (Imperial Valley Association of Governments)

STATE ESTATAL • California Transportation Commission • Fideicomisos (trusts) • Caltrans • Secretaria de infraestructura y • California Environment Protection Agency Desarrollo Urbano (SIDUE) • California Department of Fish & Game • Secretaria de Protección al Ambiente • California Highway Patrol • Comisión Estatal de Servicios Públicos (CESPT) Tijuana, Mexicali, Tecate

FEDERAL FEDERAL • U.S. Customs and Border Protection • Aduana/Secretaria de Gobernación • U.S. General Services Administration • Consulado General de México • International Boundary and Water Commission • Instituto de Administracióny Avalúos de • Bureau of Land Management Bienes Nacionales (INDAABIN) • Federal Highway Administration • Comisión Internacional de Limites y • Federal Highway Administration Aguas (CILA) • U.S. Fish and Wildlife Service • Secretaría de Comunicaciones y • Department of Homeland Security (DHS) Transported (SCT) • Aeropuerto Internacional de Tijuana • Secretaria de Medio Ambiente y Recursos Naturales (SEMARNAT) • Procudaria General de la Republica

NON-GOVERNMENTAL ORGANIZATIONS ORGANIZACIONES NO • Chambers of Commerce-Economic Development GUBERNAMENTALES Corporations (ONGs)–COMUNIDAD • Academia • Cámaras de Comercio • Las Californias Binational Conservation Initiative • Academia • Other • Pronatura • Otros The California-Baja California Infrastructure Crisis | 29

decision-making, broken out by dif- U.S.-Mexico Bi-national Commission ferent levels of government for the Working Group on Homeland U.S. and Mexico. The cross-border de- Security and Border Cooperation, and cision-making process is complex, and the Policy Advisory Committee for cuts across different layers of govern- the California-Baja California Master ment and categories of infrastructure. Plan. These efforts at consolidation Several important points can be made tend to lack replicable rules; instead about cross-border decision-making. guidelines are created as the groups First, stakeholders fall into dis- unfold. This inductive approach has crete groups: Transportation (U.S. the advantage of adapting to the evo- Department of Transportation, lution of issues in each decision area. CALTRANS, California Trans- Policy-making, however, may not portation Commission, and Mexican be easily converted to a permanent counterparts), Environment (EPA, U.S. structure of guidelines since policies Fish and Wildlife, etc., and Mexican evolve incrementally. counterparts), Airports (San Diego Probably, the most striking ele- County Regional Airport Authority, ment of stakeholder dynamics is that etc.), ports of entry (GSA, Mexican decision-making is cross-national. counterpart), Law Enforcement and This is, by far, the greatest challenge Security (DHS, Customs, California to California-Baja California border Highway patrol, etc.), Regional infrastructure planning and manage- Government (SANGAG, IVAG, IMIP, ment. A number of challenges face etc.), and Local government (cities, stakeholders working in a bi-cultural counties). Decision-making some- context. times becomes fragmented within First, there are signifi cant differenc- these specialized sub-areas. However, es in the political organization of U.S. because there is also considerable vs. Mexican infrastructure decision- overlap in these decision areas, an making. Mexico has historically been important component of the infra- a nation where power is centralized at structure decision-making process the federal and state levels, and where is the formation of working groups, local governments are weak and lack which allows for the consolidation of control over the funding of highways, state, regional and international agen- rail, airports, etc. This pattern contin- cies around specifi c projects, such as ues south of the border, even though highways, ports of entry, and envi- efforts to decentralize over the last ronmental issues. Some examples of two decades have begun to open the “working groups” include: The U.S.- door for change. By contrast, local Mexico Joint Working Committee, governments in the U.S. have greater the U.S.-Mexico Bi-national Bridges jurisdictional power over land use, and Border Crossings Group, the urban planning and environmental 30 | Global Crossroads

decisions, and considerably larger California-Baja California border shares of local revenues for planning cities, Tijuana (the new IMPLAN of- and policy-making, and even for build- fi ce) and Mexicali (the IMIP offi ce). ing infrastructure (local tax revenues However, since these are new projects, for redevelopment, for example). they remain works in progress and A second difference between Mexico thus are not entirely free of political and the U.S. is that “planning”—both pressure.17 urban and regional—has historically A third important consideration been more lies in the role of privatization. The process directlyd infl u- Privatization of public facilities and of planning, encede by poli- infrastructure (airports, ports, etc.) ticst in Mexico has been a powerful force in Mexico funding and thant in the U.S. since laws were passed in the 1990’s managing border InI Mexico, making this process legal. For ex- infrastructure governorsg and ample, the 1993 Law of Maritime in this region mayorsm have Navigation and Commerce authorized is a complex traditionallyt the national Secretary for Trade and web of planning hadh complete Transportation (SCT) to issue private politicalp concessions to permit private owner- processes and controlc over ship of airports and ports, with up policy-making planningp to 49% foreign ownership. This has avenues that authorities,a led to the privatization of many ports cut across includingi the and airports throughout Mexico, in- federal, state, appointmenta cluding the Port of Ensenada, and the and regional/ ofo directors of Tijuana International Airport. While planningp offi c- they have many privatized functions local agencies on es.e Historically, (commercial concessions, etc.), U.S. both sides of the locall and airports are still mainly controlled border. regionalr plans by public entities. But, in Mexico, tendedt to be privatization permeates the manage- vaguev about ment of infrastructure. This could be specifi c projects, so political offi cials an important factor in cross-border were free to control funding of de- decision-making for the future. velopments. This pattern has been signifi cantly modifi ed by nation- wide efforts to depoliticize planning b. Existing Planning Processes for since the early 1990’s, including the California-Baja California Border creation of politically independent Infrastructure planning authorities for the fi rst time. The process of planning, funding and Such authorities exist in the two large managing border infrastructure in The California-Baja California Infrastructure Crisis | 31

Table 6 California-Mexico Border Corridor Data, 2000

A San Diego-Tijuana-Tecate B Imperial-Mexicali Highways Average Annual Daily Traffi c (AADT) 719,972 92,755 Highway Length [in miles] 292.40 377.80 LOS [A=1 to F3 = 9] 3.922 1.330 Capacity at Peak Hour 42,177 23,871 Land Port of Entry Border Crossing Number trucks 910,694 117,326 Total volume [tons] 3,162,134 407,383 Value of goods Millions $ $14,121 $1,819 # passenger vehicles & buses 26,566,907 3,422,661 Airports Total volume [tons] 94,168 12,132 Maritime Ports Total volume [tons] 1,803,950 232,406 Total number TEUs Railroads Border Crossing at POE Number rail cars 202 246 Total volume [tons] 9,676 78,632 Total Number TEUs 3,874 5,779 Value of goods Millions $ $1.0 $22.8 Total AADT in Two Corridors Share of AADT Among Corridors 812,728 88.6% 11.4%

Notes: POE, Airport & Maritime port data are assigned to Corridors based on AADT distribution. Source: Binational Border Transportation Infrastructure Needs Assessment Study (BINS), Sourcepoint, 2004. this region is a complex web of plan- 1. Federal level cross-border ning processes and policy-making cooperation. avenues that cut across federal, state, In 1994, the Mexican and U.S. and regional/local agencies on both national governments signed a sides of the border. What follows is a Memorandum of Understanding to synthesis of some of the key processes create a U.S.-Mexico Joint Working as they have evolved: Committee (JWC) through the U.S. 32 | Global Crossroads

Department of Transportation and patterns and thus for crafting funding Mexico’s Secretary of Transport strategies. In 2005, the U.S. Congress and Communications. The idea passed the Safe, Affordable, Flexible, was to bring together both nations Effi cient Transportation Equity Act and their supporting transport (SAFETEA), which authorizes monies and border crossing agencies (the for transport infrastructure in various U.S. Department of State, General regions, including the border region. Services Administration, California An initiative called the CBI or Cross Department of Transportation, etc.) Border Initiative also allows for some to plan and organize future highway funds to specifi cally support projects and port of entry strategies. This ef- in Mexico. fort led to the U.S.-Mexico Border Partnership Action Plan, which, in turn, evolved toward the creation of 3. International border security/ a Smart Border Action Plan in 2002, operations. which has 22 points of agreement The Department of Homeland about making border crossings more Security (DHS) and U.S. Department effi cient (U.S. Department of State, of State bring together members of 2002). the U.S.-Mexico Bridge and Border Crossing Group to “create a border region that is modern, safe and 2. Federal level funding and effi cient.” The Bridge and Border planning of highways. Crossing Group also includes cor- In the early 2000’s, The U.S. responding Mexican agencies, Department of Transportation (DOT) including the Secretary of Foreign created a planning process for fund- Relations, and works to streamline ing U.S.-Mexico border roads. A key border crossing security at the ports mechanism was the bi-national Border of entry. Other programs that seek Infrastructure Needs Assessment to combine security with border Study or BINS, completed in 2004. crossing effi ciency include: This study identifi ed key transport corridors in the border region, based • Fast and Secure Trade (FAST), on quantifi able traffi c fl ow data, which screens and tracks goods including “average annual daily traf- entering and leaving the U.S., fi c” (AADT). Based on this data (see thus speeding up the fl ow of Table 6), the U.S. DOT, working with commercial vehicles across the CALTRANS, identifi ed a set of fund- border; ing priorities and indicated shortfalls • Secure Electronic Network for in funding. This important study cre- Travelers Rapid Inspection ated a mechanism for projecting travel (SENTRI)—an automated The California-Baja California Infrastructure Crisis | 33

Table 7 Future Border Crossing Projects, California-Baja California

Location Status Andrade/Algodones New crossing for POV’s (Privately owned vehicles), unfunded Calexico/West Mexicali funded FY 2009 Calexico/Mexicali Silicon Border project private funding, uncertain Tecate crossing funded Otay Mesa II crossing funded: projected for 2010–2013 San Ysidro/El Chaparral Expansion funded: Phase I 2009–2112 Phase II 2014

dedicated computer lane us- • “U.S. Visit” is a new program ing an Automated Vehicle which will track entries and Identifi cation technology, which exits to the U.S. along the inter- allows security checks but with national border. a high level of effi ciency, thus • Border Release Advanced reducing congestion. Screening and Selectivity (BRASS) program is another SENTRI is the world’s fi rst automated specialized new program which dedicated commuter lane. In theory it tracks the entry and exit of reduces congestion by allowing agents people into the U.S. of the Bureau of Customs and Border Protection to speed up border cross- ing inspections—via pools of low 4. Planning ports of entry. risk, pre-enrolled crossers at ports of The General Services Administration entry. The system identifi es travelers (GSA) is charged with funding and who pose little risk to border security, managing port of entry facilities. The verifi es their low risk status through U.S.-Mexico Bi-national Bridges and onsite electronic record checks, and Border Crossing Group works with screens approved participants and GSA on border crossing projects their vehicles each and every time they from a security and fl ow manage- enter the United States from Mexico. ment perspective (see section on SENTRI was fi rst implemented at Cross-border operations below). the Otay Mesa, California port of Table 7 lists 6 new or expanded entry on November 1, 1995. SENTRI ports of entry that are under discus- Dedicated Commuter Lanes also ex- sion. These projects are coordinated ist at San Ysidro. with CALTRANS and with Mexican 34 | Global Crossroads

companion agencies—the Secretaría 6. State analysis, funding and de Comunicaciones y Transportes construction of highways: (SCT) and the INDAABIN (Institute California Transportation for Administration and Management Commission/CALTRANS. of National Goods). Some of the Drawing from the BINS study gen- ports of entry will be privatized, and erated by the U.S. Department of thus funding and management will Transportation, the federal SAFETEA fall to the hands of private managers. transport funding mechanism, and oth- For example, the Calexico-Mexicali er statewide priorities, the California crossing at the Silicon Border project Transportation Commission created would be managed by a consortium the “Trade Corridors Improvement of companies manufacturing and Fund” program, which allocates marketing computer chips. monies for highways and rail projects in four major categories:

5. Border Governors’ Declarations. • LA/Inland Empire (approxi- Each year, the Governors from the mately $1.5–1.7 billion); border states in the U.S. and Mexico • San Francisco/Bay/ Central meet to discuss key issues facing Valley Corridor ($640–680 their administrations. One role of million); this process is to challenge decision- • San Diego/International Border making coming out of the national Corridor ($250–400 million); capitals. For example, in 2007, the • Other regions ($60–80 million). XXV Border Governors Conference produced a Joint Declaration which Clearly, the international border called for a Border Master Plan corridor ranks only third in the state (discussed below), and made com- for “trade corridors” money. In ad- mitments to promoting economic dition, CALTRANS infrastructure development and regional com- planning decisions are guided by two petitiveness along the border, while critical policy reports generated by challenging the U.S. Department of the agency: Homeland Security’s policy of build- ing more border fences, which is seen a. The CALTRANS as contributing to bottlenecks and Bottleneck Study (2004). more delays along the border (Border This report grew out of Governors, 2007). the U.S.-Mexico Border Partnership Action Plan (created by the U.S.- Mexico Joint Working Group), which encouraged The California-Baja California Infrastructure Crisis | 35

prioritizing infrastructure systematically catalogues projects along the border all of the major infrastruc- and taking steps to relieve ture projects in the border congestion and delays. The region—both existing and 2004 Bottleneck Study projected. It further analyzes focused on developing a which projects are funded methodology for improving and which are not, and gives transportation projects to detailed budget breakdowns and from the ports of entry, on funding. This landmark as well as traffi c manage- study provides a template ment around border cross- for transport projects in the ings. Using the two main future, and is an important POE’s in San Diego-Tijuana guiding force for the Border (San Ysidro/Puerta Mexico, Master Plan, a work in Tijuana and Otay Mesa/ progress (see discussion Mesa de Otay) as case stud- below). ies, the report tested the methodology—it identifi ed improvements—from road 7. Joint state-regional structure, numbers of lanes, infrastructure planning. turning radii for trucks and The California Department of vehicles to new programs Transportation (CALTRANS), like SENTRI and High working closely with the San Occupancy Vehicle lanes. Diego Association of Governments b. The California-Baja California (SANDAG), has produced most Border Report (2006). of the “state of the art” plans and Building on the fi ndings studies that either guide or directly of the Bottleneck Study, infl uence decision-making for high- the 2006 California-Baja ways and rail construction along the California Border Report is California-Baja California border. the primary comprehensive These include: study of Californian and Mexican infrastructure c. Survey and Analysis of Trade in the border region. It and Goods Movement Between catalogues existing and California and Baja California, proposed needs for the 2003 (CALTRANS/SANDAG). border region’s highways, This analysis of bi-national rail projects and ports of commerce analyzed cross- entry in both California and border shipping patterns Baja California. The study using a survey of 120 36 | Global Crossroads

sample companies, and a 27 state an estimated U.S.$6 question survey instrument. billion in gross output and It found waiting times for over 50,000 jobs. Further, it trucks to be excessive (2–3 found in surveys that nearly hours) and recommended 60% of border crossers major improvements for would be willing to pay a $3 cross-border trucking fa- toll to cross at a new port cilities, especially at Otay of entry (Otay Mesa East) Mesa. It also recommended if it would provide faster more road infrastructure access across the border. It improvements, dedicated also suggested that trucking lanes, more staff and better delays interrupt the cycle of technology, and a need to back and forth movements know the costs of delays. of vehicles involved in the The last recommendation maquiladora (assembly resulted in the 2006 study plant) sector along the of the “Economic Impacts border, thus disturbing the of Wait Times,” as follows. manufacturing and delivery d. Economic Impacts of Wait routines of the maquiladora Times at the San Diego-Baja industry. California Border, 2006 e. Otay Mesa/Mesa de Otay (CALTRANS/SANDAG). Bi-national Corridor Strategic This is another landmark Plan, study, the fi rst major policy 2007 (SANDAG, COBRO— study of the economic costs Committee on Bi-national of border delays for the Regional Opportunities). California-Baja California This plan grew out of border. Building on meth- the SANDAG Regional odologies used by previous Comprehensive Plan, which researchers in studying called for a partnership the costs of delays on the with Mexico to address Canada-U.S. border, this bi-national planning issues. study used a sophisticated The plan describes trans- economic model of the cost portation, economic devel- of delays for personal trips opment, housing and envi- and freight movements. It ronmental issues within the found signifi cant structural Otay Mesa/Mesa de Otay weaknesses in “infrastruc- study area. It then provides ture capacity,” claiming an institutional framework that delays would cost the for decision-making in the The California-Baja California Infrastructure Crisis | 37

sub-region, and a “Strategic The idea of the Border Plan Work Program,” or Master Plan is to create a set of proposed initiatives structure for comprehensive needed to improve circula- bi-national transportation tion in the corridor. planning, and then get stake- f. Goods Movement Action Plan/ holders on both sides of the 2030: San Diego Regional border working jointly to Transportation Plan, 2007 implement the plan. The (SANDAG/ Borders plan has two objectives: Committee). a) it will generate a list of The Goods Movement prioritized port of entry and Action Plan offers a detailed transportation projects, and breakdown of prioritized b) it will suggest operational projects and revenue sce- improvements that will seek narios for the San Diego/ to integrate federal, state, border region in the areas and local input. The strategy of maritime, rail, border of the plan is to calculate crossing, air cargo, pipeline, future demand for trans- and highway infrastructure. portation based on a wide g. Borders Element, San Diego array of land use, employ- Regional Comprehensive Plan, ment, travel, and housing 2004 (SANDAG/ needs data. Demand data Borders Committee). will then be translated into The Borders Element in the an analysis of infrastructure Regional Comprehensive needs, followed by the gen- Plan establishes a frame- eration of a project priority work for bi-national list. The prioritization of planning across a set of infrastructure needs will be regional issues, including determined by an appointed transportation. Policy Advisory Committee h. California-Baja California (PAC), composed of govern- Border Master Plan, 2008 in ment and quasi-government progress stakeholders. (SANDAG, CALTRANS, U.S.-Mexico Joint Working It should be noted that, as one Committee on Transport catalogues the breadth of planning Planning, SIDUE—Secretary processes at the federal, state, and of Infrastructure and local levels, the need to work across State Urban Development, levels of government is paramount. As Mexico). mentioned, the creation of working 38 | Global Crossroads

groups partly solves this problem. The California’s cross-border connection California-Baja California Master to California is shaped by geography, Plan may, in fact, achieve a synthesis settlement history, and politics, all of many different plans and ap- of which impact present and future proaches into a single policy process investments in transportation and that will have the effect of consolidat- trade infrastructure. ing the multiple efforts documented Although the regions are linked, above. Whether the Policy Advisory there are also some differences be- Committee tween the settlement structures of the Large-scale, (PAC)( will two states. Unlike its neighbor to the capital-intensive haveh suffi cient north, Baja California’s urbanized jurisdictionalj population is not skewed toward mega- powerp to en- the coastal zone, but rather, distrib- infrastructure forcef the rec- uted more evenly across the northern schemes planned ommendationso edge of the state, where it touches in Baja California ini the plan the California border. The Tijuana- seek to tap remainsr to be Rosarito-Ensenada corridor has the the Mexican seen.s Further, largest share of the urban population whetherw the (some 1.5 million), but Mexicali’s state’s privileged planp can ade- population (offi cially 855,962, but location. quatelyq ensure probably well over one million), plus betterb cross- population in the east desert, and borderb coordi- Tecate’s growth in the middle of the nation of planning efforts also remains peninsula, display a markedly dif- an unanswered question. And fi nally, ferent pattern than just north of the and perhaps most critically, whether border, where the San Diego-Orange funding will be available to imple- County-LA County urbanized coastal ment policy recommendations, in the corridor (over 10 million population) current climate of budget shortages, completely overshadows the desert is a huge uncertainty. populations east of the mountains. Baja’s pattern of human settlement more evenly spread across the penin- c. The Bi-national Connection sula is partly explained by the growth Beyond understanding stakeholders of the inland state capital, Mexicali. and key border planning approaches, Mexicali’s urban development tapped a third crucial dimension necessary in its rich agricultural resource base crafting a cross-border infrastructure which fueled large-scale economic strategy is the recognition of the growth in the early 20th century. This inherent links of California’s border was later backed by American capi- zone with Baja California. Baja tal. By the 1950’s, it became the state The California-Baja California Infrastructure Crisis | 39

capital when the Baja territory was FUTURE POLICY STRATEGIES FOR offi cially recognized as the twenty CALIFORNIA-BAJA CALIFORNIA ninth state of the Mexican republic BORDER INFRASTRUCTURE (Meade, 1985). The Mexican govern- While there a variety of planning ment’s decisions on transportation processes underway, a well designed and cross-border regional develop- California-Baja California border ment infrastructure are partly tied infrastructure network will require a to Baja’s traditional regional power number of critical policy strategies in structure as well as the government’s the future. These include: interest in building a global trade infrastructure. With California-Baja California 1. Restructure Highway cross-border fl ows on the upswing, it Infrastructure will be important for policy makers a. Shift Orientation from east-west to understand regional growth trends to north-south. (including new infrastructure) that As noted, one of the main foci of will mediate fl ows from the Mexican border plans has been to identify and (northern Baja California) side of the prioritize investment in trade “cor- border. The northern border region ridors”. The principal north-south continues to be one of Mexico’s most highway “trade corridors” for promising economic development California-Baja California (see Figure zones. Baja California is the wealthi- 6) are: a) the coastal route, from San est of the northern frontier states, Ysidro along I-5 to Orange County/ and close to the richest and largest LA County; b) the inland route U.S. market (southern California). along I-15 through northern San Large-scale, capital-intensive mega- Diego County into Riverside and San infrastructure schemes planned Bernardino Counties (east of Orange in Baja California seek to tap the County); and c) the desert route from Mexican state’s privileged location. SR 111, SR 86 to I-10. The princi- Taken together, the new Baja proj- pal east-west connectors are: a) SR ects could have a signifi cant impact 94/125; b) I-8; and c) SR 905.18 The on the management of the region’s southern sierra mountain chain run- border crossing zones. They include: ning inland from Santa Barbara all highway infrastructure, ports, rail the way to the Mexican border poses linkages, and new growth poles, a natural geographic barrier that lim- including a science park in Mexicali its east-west freeway connections. and a manufacturing corridor along Ironically, the regional orienta- the Tijuana-Tecate highway. These tion of the freeway infrastructure in are discussed in greater detail in the southern California, and especially next section of this report. San Diego County is east-west, rather 40 | Global Crossroads POE POE 8 78 2 5 IMPERIAL COUNTY POE 115 POE 111 RIVERSIDE COUNTY U.S.A. U.S.A. MEXICO 86 MEXICO CALIFORNIA CALIFORNIA BAJA CALIFORNIABAJA BAJA CALIFORNIABAJA 78 2 8 74 SAN DIEGO COUNTY 79 POE 94 79 76 POE 94 67 52 POE 5 1-D 15 56 163 805 78 76 Highway Networks in the Cross-Border Region Networks Highway 5 POE (Port ofPOE Entry) Mexico Highways Highways Interstate U.S. Roads Major Mexico Roads Major U.S. California State Routes State California

74 Pacific Ocean Figure 6 The California-Baja California Infrastructure Crisis | 41

than north-south. For example, in truck inspection facility at Tecate; SR the San Diego region there are 7 111 recently completed in Imperial major east-west fl ow corridors (SR County; SR 7 and SR 115 to enhance 905/11, SR 54, SR 94, I-8, SR 52, truck fl ows in Calexico East crossing; SR 56, SR 78), while there are only a new truck crossing inspection facil- two major north south corridors (I- ity in Winterhaven, Imperial County; 5/805 and I-15), and a third under and a possible new border crossing construction (SR 125). Clearly, exist- at Jacumba-Jacume, near Tecate ing highway infrastructure is more (CALTRANS, 2006). The Jacumba oriented toward moving residents to crossing is im- work, shop, school, or to recreational portant, since Clearly, existing destinations than it is in getting trade it would relieve highway cargo from origin to destination. fl ows from the This pattern may be slowly chang- growing Tecate infrastructure is ing, however. For example, the San region, whose more oriented Diego Association of Governments population toward moving has discussed amending its regional is projected residents to work, transportation plan to create cargo to expand to shop, school, or trucking lanes on major north-south 184,000 by to recreational freeways. Still, there is a tension on 2020 (nearly highways between the traditional double its cur- destinations than coastal-inland connectivity, and the rent popula- it is in getting emerging north-south trade fl ow. tion). Tecate’s trade cargo growth can from origin to be traced to destination. b. Adapt to higher volumes: new a number of highways and truck crossings factors. First, A critical infrastructure need for the location southern California is highway infra- of the Ford Tacoma truck assembly structure set up to handle the expected operations on the Tijuana-Tecate tripling of truck crossings by 2030. corridor has spurred growth in the Along the immediate California bor- maquiladora sector in Tecate. Second, der, transportation plan upgrades to Tecate is an attractive manufacturing highway trade infrastructure include employment site, due to its pristine SR 905, SR 125, and special truck natural setting, lower land costs, routes at and around the Otay Mesa and higher quality of life than either crossing facility; SR 11 and a future Mexicali or Tijuana. This quality of crossing at Otay Mesa East (which life factor also contributes to projec- would free up the Otay Mesa cross- tions of future growth in tourism, and ing for greater truck fl ows); a better in cross-border commerce. 42 | Global Crossroads

c. Expand truck-only lanes agreement. The Bush administration Commercial truck expansion raises supported this policy in 2006–2007. several policy concerns, however. First, In the spring of 2007, the U.S. is it enough to build wider highways Congress delivered a setback to that or new state freeways, which then strategy by voting to delay full access compete with other users for space? to Mexican trucks on U.S. highways Or, should regional transportation (CNN, 2007). U.S. lawmakers claim planning agencies consider building they are concerned about the safety “truck only lanes” to facilitate the of Mexican trucks on U.S. highways, greater fl ow of trucks? One recent since they do not undergo the same study of California-Baja California inspections as California trucks do. truck fl ows in San Diego County They also claim to be concerned about found that the fl ow was not large the environmental impacts of unregu- enough to warrant the investment lated Mexican trucks and their pos- in creating separate trucking lanes sible use for smuggling illegal drugs. (SANDAG, 2003). Transportation Mexican truckers also face political planners generally assume that truck- competition from the U.S. Teamsters only lanes become cost effective if Union which has long fought to keep 30% or more of the traffi c volume outside truckers from competing along a given corridor is commercial with U.S. truckers. However, by late truck traffi c. In San Diego County, summer 2007, the U. S. Department studies in 2003 found the fl ows to be of Transportation granted fi nal ap- much lower, only about 15% in peak proval for Mexican trucks to have areas. full travel rights on U.S. highways. This landmark decision marked the fi rst time, since the signing of NAFTA, d. Resolve the Mexican that Mexican trucks would be able trucker question to travel beyond the 25 mile buffer Another important question is: will zone established in 1982. U.S. trucks Mexican truckers be able to cross the would also now have equal access border and continue to their destina- within Mexico. In the initial one year tions in the U.S., or will Mexican “pilot program” stage, 100 Mexican trucks have to be off-loaded onto U.S. companies were allowed to send owned trucks at the border, or within their trucks anywhere in the United a 25-mile buffer zone, and then have States. Equally, 100 U.S. fi rms were the goods taken to their fi nal desti- given the same privilege in Mexico nation by U.S. trucks? Mexico has (Krawzak, 2007). However, in March lobbied with the U.S. government 2009 the pilot program was cancelled to allow its trucks to travel on U.S. after the United States Congress and highways, as part of the NAFTA President Obama declined funding The California-Baja California Infrastructure Crisis | 43

for the program. Mexico retaliated on highways and other mobility by introducing tariffs on a number of sources (bus, rail, etc.) to support this different agricultural and manufac- burgeoning fl ow of people. Indeed, tured goods. And in June of 2009, a as mentioned, congestion at the San Mexican trade association represent- Ysidro and other California ports of ing Mexican truckers fi led a $6 billion entry is hurting cross-border trade, lawsuit against the U.S. government since businesses may choose not to for damages incurred as a result of invest or participate in California- the cancelled pilot program. As such, Baja California the trucking situation remains em- trade ventures, With some 6 broiled in a contentious dispute be- if they believe million people tween Mexican truckers and the U.S. their trade fl ow government, leaving a high degree of will suffer too living along the uncertainty around its future. many delays at border, (a fi gure the border. that will reach San Ysidro, about 10 million e. Expand north-south highways in particular, is to accommodate cross-border by 2030), the fl ow a port of entry of consumers is a consumers (including tourists) in desperate Aside from moving goods by truck, need of revi- vital layer of cross- highways also facilitate the fl ow of talization. In border trade, both cross-border consumers participating 2006, 17 mil- in the retail and in retail trade and tourism. Nearly 90 lion cars passed tourism sectors. million people cross the border each through its 24 year, either in passenger vehicles or northbound on foot (see Tables 8 and 9). With vehicle gates. Over 110,000 travelers some 6 million people living along per day are processed. It is the busiest the border, (a fi gure that will reach land border in the U.S. Wait times can about 10 million by 2030), the fl ow reach 2 ½ to 3 hours. CALTRANS and of consumers is a vital layer of cross- the General Services Administration border trade, both in the retail and are working on a $125 million plan tourism sectors. to expand and reconfi gure the port of By far, the largest fl ow of passen- entry, and redesign its connection to gers occurs at the Tijuana/San Ysidro adjacent highways. The fi nal comple- crossing, with over 40 million people tion date is targeted at 2012. a year travelling north from Mexico Tourists spent $88.1 billion in (and presumably a similar number California in 2005; international visi- returning south into Baja California tors represent 16% of that amount, at some later point). This puts a or about $14 billion. Using these huge strain on the port of entry, and fi gures, we can project that Mexican 44 | Global Crossroads

Table 8 Incoming Passenger Crossings in Personal Vehicles, U.S.–Mexican Border (Arizona, California, New Mexico and Texas), 2000–2003

Port Name 2000 2001 2002 2003 Arizona, Total 26,856,458 23,726,701 26,895,469 24,424,403 Douglas, AZ 6,193,596 5,203,890 7,797,492 5,007,082 Lukeville, AZ 1,125,638 1,283,988 1,292,155 1,195,838 Naco, AZ 881,911 818,797 927,393 1,629,654 Nogales, AZ 11,501,672 9,876,703 8,888,684 9,643,835 Sasabe, AZ 85,530 97,148 109,775 111,450 San Luis, AZ 7,068,111 6,446,175 7,879,970 6,836,544 California Total 74,569,309 67,410,517 68,180,103 70,757,903 Andrade, CA 1,808,452 1,412,177 1,544,438 1,477,979 Calexico, CA 20,094,460 15,007,725 12,106,876 10,144,416 Calexico East, CA 7,600,859 7,420,103 6,889,681 6,155,005 Otay Mesa/San Ysidro, CA 10,659,498 8,405,047 9,109,341 11,019,106 San Ysidro 31,025,343 33,003,554 36,171,884 39,180,519 Tecate, CA 3,380,697 2,161,911 2,357,883 2,780,878 New Mexico, Total 1,582,972 1,354,477 1,687,047 1,620,337 Columbus, NM 1,414,791 896,272 915,379 1,014,385 Santa Teresa, NM 168,181 458,205 771,668 605,952 Texas, Total 136,785,813 116,614,151 102,258,073 96,894,839 Brownsville, TX 19,693,130 16,951,901 15,820,595 15,673,205 Del Rio, TX 5,866,666 4,425,005 4,734,574 4,440,813 Eagle Pass, TX 8,594,198 8,506,655 9,187,598 8,285,854 El Paso, TX 48,420,274 39,200,481 26,363,164 26,317,018 Fabens, TX 2,116,881 1,892,674 1,790,575 1,383,547 Hildalgo, TX 21,947,731 17,713,609 17,613,527 15,587,611 Laredo, TX 17,877,845 17,282,264 15,915,545 15,208,606 Presidio, TX 1,900,683 1,822,312 1,775,433 1,684,610 Progreso, TX 3,321,066 3,019,075 3,019,260 2,805,267 Rio Grande City, TX 2,383,033 2,156,164 2,591,589 2,471,812 Roma, TX 4,664,306 3,644,011 3,527,213 3,306,496 U.S.–Mexico Border Total 239,794,552 209,105,846 199,020,692 193,697,482

Source: U.S. DOT, BTS based on data from U.S. Customs Service, Mission Support Services, Offi ce of Field Operations, Operations Management Database. The California-Baja California Infrastructure Crisis | 45

Table 9 Incoming Pedestrian Crossings in Personal Vehicles, U.S.–Mexican Border (Arizona, California, New Mexico and Texas), 2000–2003

Port Name 2000 2001 2002 2003 Arizona, Total 8,390,803 8,994,847 9,682,233 9,154,958 Douglas, AZ 682,872 728,585 648,989 776,258 Lukeville, AZ 109,800 126,268 78,336 89,694 Naco, AZ 92,617 92,554 72,628 77,518 Nogales, AZ 4,677,819 4,874,738 5,911,866 5,583,533 Sasabe, AZ 3,133 2,443 2,136 2,048 San Luis, AZ 2,824,562 3,170,259 2,968,278 2,625,907 California Total 18,596,679 21,699,797 18,628,200 18,193,283 Andrade, CA 1,762,700 1,779,392 1,703,862 1,747,369 Calexico, CA 8,352,324 7,119,785 6,894,820 6,230,123 Calexico East, CA 2,293 2,538 2,398 1,586 Otay Mesa/San Ysidro, CA 648,756 1,002,971 1,684,117 1,467,171 San Ysidro 7,542,450 11,435,946 7,903,483 8,302,110 Tecate, CA 288,156 359,165 439,520 444,924 New Mexico, Total 191,351 185,814 264,165 259,312 Columbus, NM 187,709 182,025 250,968 242,448 Santa Teresa, NM 3,642 3,789 13,197 16,864 Texas, Total 19,910,809 20,620,863 21,703,683 21,056,220 Brownsville, TX 3,017,533 3,176,131 3,204,848 2,920,355 Del Rio, TX 265,252 258,102 167,153 132,216 Eagle Pass, TX 920,114 864,105 691,904 698,602 El Paso, TX 5,825,155 7,201,100 9,301,395 8,899,168 Fabens, TX 23,813 32,208 33,723 25,311 Hildalgo, TX 2,575,622 2,325,812 1,958,914 2,138,232 Laredo, TX 5,492,769 5,060,947 4,648,046 4,577,725 Presidio, TX 16,019 24,240 34,065 25,187 Progreso, TX 1,193,590 1,278,671 1,288,506 1,275,881 Rio Grande City, TX 86,225 88,089 129,752 121,149 Roma, TX 494,717 311,458 245,377 242,394 U.S.–Mexico Border Total 47,089,642 51,501,321 50,278,281 48,663,773

Source: U.S. DOT, BTS based on data from U.S. Customs Service, Mission Support Services, Offi ce of Field Operations, Operations Management Database. 46 | Global Crossroads

Figure 7 Visitors to California 2005, by Foreign Origin

4% 4% 10% 4%

6% 9%

United Kingdom

Japan

Canada

14% Mexico (land)

Mexico (air)

Germany

South Korea

Australia 49%

Source: California Fast Facts 2006, California Travel and Tourism Commission and Business, Transportation and Housing Agency. Division of Tourism. visitors to California spend about can therefore surmise that at least half $6 billion per year.19 Mexican tour- (and very likely more than half) of all ists (who arrive by land and air) Mexican visitor expenditures occur in are by far the largest category of counties on or near the California-Baja international visitors to California California border (Figure 8). This is an (see Figure 7). Of Mexican visitors additional pressure on highway infra- crossing by land, expenditures vary structure along the border and needs considerably across modes of travel, to be factored into future allocations with automobile travel far exceeding of funding and planning strategies for average expenditures of visitors over state transportation. all other modes of land travel.20 Of the $88.1 billion spent by travelers in California, more than f. cross-border highway connections half of that total is spent in southern to the larger southern California California counties. For example, the region most visited theme park attractions are One additional challenge facing mainly in southern California.21 One cross-border infrastructure is molding The California-Baja California Infrastructure Crisis | 47

Figure 8 Travel Spending by County, 2004

Los Angeles, 22%

Los Angeles Orange Riverside Rest of California, 49% Orange, 8% San Bernardino San Diego Rest of California Riverside 6%

San Bernardino, 4%

San Diego, 11%

Source: California Fast Facts 2006, California Travel and Tourism Commission and Business, Transportation and Housing Agency. Division of Tourism. connections between the immediate of enhanced fl ows and searching border counties (San Diego, Imperial) for alternative transit options. The and the counties to the north—Or- Inter-Regional Partnership (IRP) is ange, Los Angeles, San Bernardino, a state funded program (through the Riverside. Evidence suggests that California Department of Housing while in the past these counties car- and Community Development) that ried out regional planning somewhat allows offi cials from the three region- independently, there is much more al transit entities to work together to coordination in inter-county transit deal with traffi c congestion resulting infrastructure planning. from jobs/housing mixes that cross Indeed, the major transit agen- county borders. cies—SANDAG, SCAG (Southern Inter-county transit planning has California Association of Govern- been implemented between San Diego ments) and Western Riverside and Riverside counties. Some 114,000 Council of Governments (WRCOG) daily highway trips from Riverside all recognize that overlaps must County are made into the San Diego be addressed in the form of shared region, with that number expected to commuters, trade, and environmen- double by 2020. An estimated 30,000 tal impacts that link all southern Riverside County residents commute California populations. Both SCAG daily to jobs in San Diego County. and SANDAG share the policy goal Congestion along the I-15 corridor is of planning for mobility in the form a major policy concern for the region, 48 | Global Crossroads

and indirectly could be an impedi- 4) that much of that fl ow moves north ment to cross-border fl ows, given the into Los Angeles and other coastal importance of I-15 as a major trade counties, travelling along the I-5 or corridor, both for goods and retail I-15 freeways. consumer fl ows. As mentioned, San Diego regional transport plans now call for I-15 to be a major transport g. Upgrade and plan for corridor for trade cargo. highways in Baja Meanwhile, the fl ow of trucks and Figure 6 illustrates existing highway passenger vehicles along the coastal corridors in Baja. They largely mir- corridor continues to grow. For ex- ror the California side of the border, ample, traffi c fl ow data in San Diego with the primary corridors fl owing County suggest that traffi c volume at from Tijuana north toward southern the northern end of the county (near California, and from Mexicali north the Orange and Riverside County toward Imperial County and toward lines) in both major corridors (I-5 the Los Angeles Inland Empire and I-15) is among the highest in the (Riverside County). It is noteworthy region, between 150,000 and 200,000 that at present only one major east- average weekly vehicles (SANDAG, west highway links Tijuana and 2007). This mirrors the data on Mexicali, the two economic centers truck and passenger vehicle fl ows of northern Baja. across the border. In the California How and which of the transit cor- BINS (Border Infrastructure Needs ridors (coastal, inland) is upgraded Assessment Study) Corridor Summary by the Mexican government will have data, (see Table 6) the fl ow across the an impact in California. In any case, San Diego-Tijuana-Tecate corridor highway infrastructure in Baja needs far exceeds the fl ow at the Imperial- to better accommodate trucking Mexicali Corridor. In the year 2000, fl ows. Trucks often have to navigate the average annual daily traffi c through arterials, side streets, and (AADT) for the San Diego-Tijuana- neighborhoods. Wide, open pathways Tecate corridor was 719,972, while feeding into truck corridor highways the average for Imperial-Mexicali was are needed. For example, the roads 92,755. Projecting ahead, for the year around the Mesa de Otay crossing in 2020, the average daily traffi c count Tijuana are poorly designed for truck rises to over one million vehicles/ movements, as they fl ow through day, while at the Imperial-Mexicali residential or commercial zones. corridor, the number is 186,000 per Highways connecting large cities also day, only one fi fth the size at the San need to be improved—including the Diego corridor. We know from other Mexicali-Tecate-Tijuana corridor. origin-destination studies (see Figure Two other critical highway connector The California-Baja California Infrastructure Crisis | 49

projects are the “Tijuana 2000,” a of southern Imperial Valley. As the highway corridor which connects rail line enters the southern end of Tijuana and Rosarito.22 Currently, the San Bernardino and Santa Rosa the poor road condition for truck mountains, there is a transition to a travel in Baja often motivates Mexican separate rail line owned by the Carrizo truckers to use the interstate system Gorge Railway (CGR). After some just north of the border in the U.S., years of dormancy, in 2001, the CGR and, as mentioned, the movements of reinitiated operations—and can now Mexican trucks was strictly regulated carry single stack rail cargo. Railcars in California. Indeed, since 1982, from the Union Pacifi c “Desert Line” Mexican trucks crossing the U.S. bor- can load and der have been required to stop within unload con- Cross-border a 20 mile border “buffer zone” and tainers at the connections will transfer their loads to U.S. truckers, Seeley junction who then complete the delivery at and then move need better sites destinations within the United States. west. The for moving from Another issue facing Baja and its CGR line then one mode to connection to California is the ques- connects at the another. tion of intermodal facilities. Cross- Tecate border border connections will need better into the San sites for moving from one mode to Diego & Arizona Eastern (SD&AE) another. With modern intermodal line which travels south of the border, centers, goods can be quickly and between Tecate and Tijuana, reenters effi ciently off loaded from train to near San Ysidro, California, then truck or vice versa. The question that travels north toward downtown San remains is: where should the inter- Diego, where it then connects into modal facility be located, and how the Burlington Northern Santa Fe would it be managed? line, and moves north towards Los Angeles. In May 2002, the Metropolitan 2. Changing Rail Infrastructure Transit Development Board of San Policy Diego signed an agreement with As mentioned earlier, the rail con- the Carrizo Gorge Railway com- nection between California and pany, ceding to them the authority Baja California is an underutilized to repair, operate, and maintain their connector for the cross-border econ- portion of the Desert Line. The omy. On the U.S. side, the line from Desert Line stills needs to be further Calexico is run by the Union Pacifi c upgraded to serve as a major artery Corporation—goods from Mexico for Mexico-California trade. Repairs move west across the desert terrain to tunnels, trestles and tracks are 50 | Global Crossroads

needed to fully incorporate the rail upgrades, however, will probably be line into a U.S.-Mexico freight ex- over $100 million (SANDAG, 2004). change corridor. For example, track When the 70 mile Desert Line alignment and tunnel clearance need of the San Diego & Arizona upgrading to accommodate modern Eastern Railway line hooks up to freight vehicles—such as those that the 62 mile coastal network of the carry double stack containers and Burlington Northern Santa Fe line, automobiles. Also, additional storage an important alternative Mexico- yards would be needed at the Port California trade corridor is added. of San Diego and at San Ysidro for The rail line could ultimately link increased freight movements through maritime port facilities in San Diego the SD&AE line. and Ensenada to other cities in the The Desert Line currently ships region—like Mexicali, Tecate and liquefi ed petroleum gas, lumber, Tijuana. It could also link to the beverages, paper, grain and sand. Naval Port facilities in San Diego. These and It would attract jobs, rail-oriented The rail line othero products industry, and international shipping suchs as bulk businesses. Furthermore, it might could ultimately commoditiesc reduce some of the congestion on link maritime needn upgraded highways in the region. There is also port facilities in railr cars and a the possibility of a new rail linkage San Diego and modernm inter- into this superstructure—from Baja Ensenada to modalm transit California—a rail line linking either other cities in facilityf to Ensenada or a new port to the south gatherg and dis- at Punta Colonet with Tecate (see the region—like tributet truck Figure 9), and then into the U.S. rail Mexicali, Tecate anda rail ship- system. This connection is discussed and Tijuana. mentsm from later in this report. oneo system to another.a The U.S. Department of Transportation 3. New and Modifi ed Ports of Entry has already allocated $43 million Existing ports of entry need to be through the Transportation and remodeled. The connection between Effi ciency Act (TEA) for upgrading ports of entry and surrounding land the Desert Line of the Carrizo Gorge uses needs to be better understood Railway system. TEA monies are to ensure that ports of entry serve specifi cally earmarked for, among local and regional needs. Highway other things, improvements along connections to the ports of entry the international border that enhance (POE) need to be expanded and im- international trade. The total cost of proved. Finally, more ports of entry The California-Baja California Infrastructure Crisis | 51

are needed to handle the increasing California trade relationship will volume of fl ows. boost economic development on both The POE buildings are overseen sides of the border. by the General Services Agency State and regional agencies are re- (GSA), a federal level agency based sponding to this challenge in several in Washington, D.C. GSA is charged ways. Gener- with managing all government ally, the phi- These agencies’ buildings. Its generic role as facil- losophy of the policy frameworks ity landlord and manager tends to major regional discourage a management approach transportation are defi ned in based on regional skills and knowl- planning agen- Washington, edge of local urban/regional issues. cies in southern D.C. and not This means that GSA administrators, California is necessarily tuned especially working from off-site pitched toward into the needs of locations, do not have any particular enhancing the California expertise in international border mobility using questions, or in regional needs for the a wide array border region. California-Border zone. The users of of policy tools, the POE’s are mainly federal govern- from adding ment agencies involved in monitoring freeway lanes and creating special- the border—all housed within the ized corridors to alternative transit Department of Homeland Security. systems looped through the freeway These agencies’ policy frameworks networks. Some planning approaches are defi ned in Washington, D.C. and that will make POE’s work better not necessarily tuned into the needs include: of the California border region. Clearly, the design and micro- a. the projected widening of exist- regional organization of transit infra- ing corridors, including I-5, structure in and around the six ports I-805, and I-15; of entry along the California-Baja b. the installation of High California border will be critical on Occupancy Vehicle (HOV) and two levels in the future: fi rst, it will carpool lanes on these and other functionally better manage the fl ow corridors; of trucks, vehicles and people across c. the remodeling of the ports of the boundary; second, if new confi gu- entry; rations and management approaches d. the improvement of roads are successful in decreasing delays, leading to POE’s, especially in it will open the door to reluctant Imperial County; investors and economic actors whose participation in the California-Baja 52 | Global Crossroads

e. the planning of new ports of en- to Tijuana. Secondly, containers of try at Otay Mesa East, Calexico industrial goods like automobiles West, and Jacumba, etc.; are shipped either through San Pedro f. the continuation of the SENTRI (LA) or San Diego. California and program as an important tool in Baja California ports are also expand- facilitating cross-border fl ows. ing to attract increased trade with ports in the Pacifi c Rim. Joint trade ventures will require multiple modal 4. Integrate Seaports into transit connections that allow goods the Border Region to be moved to destinations within California has four major seaports— the California-Baja California region Los Angeles, Long Beach (these are or outside of it. Thus, the entire sys- sometimes called the Twin Ports, since tem of improved transit—roads, land they lie in close proximity around San ports of entry, railways, and air cargo Pedro/Los Angeles Bay), Oakland facilities—impacts the success of port and Port Hueneme. Approximately ventures (Keyser, 2000). 42% of all U.S. containers used in To date, Baja’s ports have not international trade move through played a signifi cant role in cross- these ports (Haveman and Hummels, border trade. Ensenada only recently 2004). Yet hardly any of the fl ow of modernized its port. It mainly serves goods through these ports is con- goods used in Baja’s maquiladora nected to Mexico. Instead most of industry or delivery of agricultural it goes to China and Japan. As men- products. Its small size, relative to tioned earlier, almost all (about 92%) other major ports on the West coast of the trade merchandise exchanged of North America (LA, Long Beach, between California and Mexico etc.), and the lack of a rail connection moves by truck rather than through limit its long-term role in large-scale the state’s seaports. Some $20 billion fl ows of goods. Even though it has in trade goods move by truck at Otay been redeveloped, it is considered a Mesa/Mesa de Otay Port of Entry, somewhat obsolete port by interna- while about $8.4 billion in merchan- tional trade experts. In the long-term dise crosses by truck at the Calexico/ the Mexican government expects the Mexicali land port (Haveman and Port of Ensenada to serve cruise ships Hummels, 2004). and yachting, when it builds the mega- California has two shipping con- port at Punta Colonet (Greenberg, nections to Baja California: contain- 2004). Ensenada’s port cannot really ers destined for the maquiladora be expanded any further, since the city sector coming from Asia often arrive has grown to its edges, and there is no at the ports of Long Beach and Los available land for further signifi cant Angeles, and then move by land port expansion. The California-Baja California Infrastructure Crisis | 53

The development of a mega-port have become frustrated by backlogs facility at Punta Colonet could dra- at major west coast ports, especially matically reshape the role of Baja Long Beach and Los Angeles. These ports in California-Baja California include Nippon Yuson, K.K., Japan’s trade and in the entire geography largest shipping line; Maersk SeaLand, of the region’s cross-border fl ows. A the largest cargo carrier on the planet; planned mega-port facility at Punta Neptune Orient Lines; and Marine Colonet (80 miles south of Ensenada) Terminal Corporation, one of the larg- would be one of Mexico’s largest est terminal operating companies on public infrastructure projects ever the west coast. One of the bigger global built. The initial capital outlay of players in the port development story $5 billion to build the 11,000 acre and one of Hong Kong’s oldest trad- port facility, supporting roads and ing companies, Hutchison Whampoa, other infrastructure, would induce Ltd., is serious- a projected $22 billion in regional ly involved at The development multiplier effects. This would lead to Punta Colonet of a mega-port the construction of a new coastal port and would city whose population might reach an very likely be facility at Punta estimated 250,000 (Lindquist, 2006). the terminal Colonet could The port could eventually be large manager for dramatically enough to handle some 6 million the mega-port reshape the role TEU’s (twenty foot units) of cargo (Lindquist, of Baja ports in annually, placing it on a par with the 2005). California-Baja major port facilities at Long Beach These ports and Los Angeles. The port’s primary are troubled by California trade function would be to move imported a combination and in the entire goods to the interior of the United of labor un- geography of the States. The Mexican government is rest, terminal region’s cross- also considering building an energy and freeway border fl ows. production complex at nearby Punta congestion and Santo Tomas to support the new higher fees. port city. The energy complex would Meanwhile in- include a natural liquefi ed gas power coming cargo from Asia continues to plant, a second power plant, and a strain west coast ports.23 For example, desalination facility. Asian cargo has been increasing at a Changing developments in regional rate of 15% per year, with nearly 60% shipping patterns have made it possible of cargo coming from China. By 2020, for Mexico to contemplate building a Asian cargo will double in volume. global mega-port at Punta Colonet. Experts predict that just to ship Asian First, many global shipping companies goods into the U.S. interior a port the 54 | Global Crossroads

Figure 9 Punta Colonet Mega-port, Showing Possible Future Rail Line to Yuma or Mexicali

Source: Baldwin and Crotty, 2005. size of Seattle is needed right away. As be dredged for giant container ships, a result, U.S. importers have instructed a breakwater completed, roads built, shipping lines to look for alternate and housing and public buildings ways to transport Asian cargo to the erected. The port would likely need U.S.; a Mexican port sits high on the an airport specializing in cargo and a list of possible solutions to the bottle- regional rail connection. necks in LA and other port facilities. Punta Colonet’s impact would be Reportedly even corporate giants like greatly enhanced by a planned rail Walmart and Costco are looking at connection that could easily enter into Mexico as a possible conduit for get- the U.S. rail system, either at Tecate, ting faster delivery of goods destined or more likely at Yuma, Arizona for U.S. markets. (Figure 9), where it could then con- The construction of a mega-port in nect to rail systems in California’s Baja faces several obstacles. Billions Inland Empire, thus avoiding the of dollars would have to be raised to LA/Long Beach ports entirely. A fi nance supporting infrastructure for well designed rail connector could the port. The harbor would need to signifi cantly impact the management The California-Baja California Infrastructure Crisis | 55

of cross-border fl ows of goods. One like Hutchison are already involved in option would be to build a 180-mile Lázaro Cárdenas, some experts won- rail connection to Mexicali, which der whether this facility might also be could then link up with the rest of used to facili- Mexico and the United States by rail tate shipment Punta Colonet’s or highway. Another option would of imported impact would be be to simply expand highway capac- goods to the ity through Tijuana and into the U.S. interior of the greatly enhanced inter-city highway network, or across United States. by a planned rail the peninsula to Mexicali, and then In fact, another connection that on to points east and north. competing port could easily enter Another signifi cant challenge is in Panama into the U.S. rail to building the mega-port is the City, which is system … question of property rights. There building a one are competing claims to the Punta billion dollar Colonet zone, including land and mega-port mineral rights under the coastal wa- at the Pacifi c Ocean entrance to the ters. This has already infl uenced one Panama Canal to serve as an import of the more promising rail projects. shipping port alternative to over- In the spring of 2007, the Union crowded Los Angeles/Long Beach. Pacifi c Corporation announced that it would not bid on the rail connec- tion. Union Pacifi c claimed it was 5. Acknowledge the Importance concerned about land disputes arising of Major Growth Poles in Baja over the Mexican government plan California and Their Potential to build the deep water port at Punta Impact on the Border Region’s Colonet. A business interest group is Infrastructure claiming that it has mineral rights on Two other important growth centers the ocean fl oor, therefore challenging in Baja may impact the future of cross- the government right to build a port border fl ows of goods, as well as the over that site. This dispute has caused kind of infrastructure improvements some investors to back off and wait made to accommodate those fl ows. (Lindquist, 2007). Another complicating factor is the port of Lázaro Cárdenas on Mexico’s Tijuana-Tecate Corridor Pacifi c Coast. It is expected that The Tijuana-Tecate corridor is Lázaro Cárdenas, recently expanded, planned as a new industrial zone of could increase its capacity to almost northern Baja California. It might the size of LA/Long Beach in the next eventually be served by a “jobs train,” fi ve years. Since major global players a rail system that could move inputs 56 | Global Crossroads

and outputs from the sub-region to power plants, and is also close to one major cities and ports on both sides of the region’s major sources of geo- of the border. A direct rail connection thermal energy. A new border crossing to a major industrial corridor in the would likely be built to support the eastern Tijuana/Tecate zone would science park. Meanwhile, the Mexican enhance industrial growth, especially government has offered a ten year in the district near the Toyota Tacoma tax free status to all semi-conductor factory which currently builds companies who relocate to the Silicon 180,000 truck beds and 30,000 full Border complex. trucks per year. Figures are projected This billion dollar project sees to grow as high as 200,000 truck itself as a rival to the current Asian beds and 50,000 pick ups per year dominance of semi-conductor (Dibble, 2004). manufacturing. The world-wide market for silicon chips has a value of some $215 billion, with one half Silicon Border/Mexicali Science Park of the production currently in The “Silicon Border” project is a Asia. U.S. entrepreneurs behind the 10,000 acre science park, with U.S. project believe that since the hub of and Mexican private sector support. research and development started The idea is to build one of the pre- in the Silicon Valley of California, it mier computer chip (semi-conductor) would make sense to have a major production zones in the world in the production center in the nearest in- capital of Baja California—Mexicali. expensive labor region to California, Interestingly, this project was initiated the Mexican border. Further, U.S. by U.S. entrepreneurs. The chairman companies are concerned about pro- of the project, D.J. Hill, claims that tection of Intellectual Property (IP) in “Asia has not just taken manufactur- the principal silicon chip production ing, but technology too, and a lot of sites in China. They believe a facility people recognize that we need to do in Mexico, near the border, designed something about this” (Jordan, 2004). with U.S. cooperation, and managed Mexicali is well suited as a transit jointly by U.S. and Mexican interests, point into the interior of the U.S., and would be a place they could feel more would be within reach of the new port secure about. More importantly, it at Colonet. It is the only city on the could signal a major shift in Baja California-Baja California border that California’s maquiladora sector, from has relatively good access to water, “low-end” assembly to more sophisti- owing to the fact that it is closer to cated “high-tech” maquila operations. the region’s primary water source, In addition, it would create more the Colorado River. Mexicali recently regional symmetry in the distribution built two new electric generating of maquiladoras, which is currently The California-Baja California Infrastructure Crisis | 57

Figure 10 Maquiladoras in Baja California by Metropolitan Area, 2004

1000 900 800 700 600 500 400 300 200 100 0 Tijuana Mexicali Tecate Ensenada Total

Source: Instituto Nacional de Estadística Geografía e Informática (INEGI). more heavily concentrated in Tijuana a regional facility, the Mexicali (see Figure 10). International Airport does lie 12 miles To date, the Silicon Border project away. However, it is not a global trade has not moved signifi cantly forward, airport. The nearest port is far away, beyond the planning stages. However, some 3½ hours by land in Ensenada. it now has linkages to the Autonomous Everything at the Silicon Border would University of Baja California and have to be shipped by truck, unless a CETYS business training programs, rail connection to the port was built, as which are important institutional con- discussed above for the Punta Colonet nections for this essentially private sec- project. Finally, some have questioned tor project. However, several obstacles whether a Mexican border city can stand in the way of making the Silicon become a south of the border “Silicon Border project a reality. To create a Valley”. Are the cumulative effects 10,000 acre compound, the project of border smuggling, drug wars, and team will need to get access to all prop- corruption too much to overcome.? erty rights, a complicated issue in a One business executive who frequently border city, where land rights are often works in Mexico, when asked about disputed by interest groups, especially this project, stated: “If there’s a Silicon ejidos, or rural communes. Over the Valley in Mexico, it’s in Guadalajara. last decade, most, but not all the land The border cities are still the Wild needed for the project has been priva- West. Look at what’s going on in tized. A second obstacle is the lack of Nuevo Laredo with the drug lords” a major airport near the site, although (Baldwin and Crotty, 2005). 58 | Global Crossroads

6. Plan for a Cross-border Airport may be the state’s most important in- Terminal at the Tijuana/San ternational trade partner. Its proxim- Diego Border. ity and increasingly stable economy The San Diego Regional Airport portend a greater role in California’s Authority is currently studying the globalizing future. Unlike all other feasibility of building a cross-border foreign trade partners, the success of airport terminal at Otay Mesa, across California’s trade with Mexico will the boundary from the Tijuana be defi ned by land-based infrastruc- airport. This project is supported ture. With a 20% increase in exports by local non- to our southern neighbor since 2001, The San Diego governmentalg border infrastructure policy decisions Regional Airport agenciesa like merit greater attention. thet San Diego For the California-Baja California Authority is ChamberC of border region, globalization is a currently studying Commerce.C multifaceted challenge. While global the feasibility of TheT advantage manufacturing (maquiladoras) and building a cross- ofo this kind of NAFTA trade remain the two pil- border airport infrastructurei lars of the border economy, global terminal at Otay isi it creates a security and competition from other mechanismm for globalizing regions (Central America, Mesa, across cross-borderc the U.S. northwest, Texas, etc.) repre- the boundary cooperationc sent potential threats to the booming from the Tijuana ini the use of California-Baja California border airport. a Mexican economy. facilityf by Thus, to strengthen the California- CaliforniaC Baja California export sector, the re- residents. It gion needs stable and effi cient border could also attract more investment infrastructure—land ports, roads, to the immediate border zone, and and rail. Current infrastructure along be tied into border region mass the border, however, is in trouble, as transportation (rail) in the future. this report has documented. Flow volumes exceed the capacity of exist- ing ports of entry, roads, and rail sys- CONCLUSION AND POLICY tems to absorb them. Long wait times CHALLENGES interrupt business and production Globalization—the integration of the cycles, impose huge fi nancial losses state economy with trans-national and contribute to an atmosphere markets—will increasingly defi ne of uncertainty that is disturbing the the future of the California-Baja cross-border economy, and could California border region. Mexico cause investors to relocate to other The California-Baja California Infrastructure Crisis | 59

regions. Meanwhile, Department of of entry development plans will be Homeland Security policies along integrated to support and match up the border are, at times, generating against Mexico’s border transport overzealous interventions that result systems and regional development in even greater delays and more mega-projects, since the latter could uncertainty. dramatically shift cross-border fl ow The costs of inadequate infra- patterns. Another reason to upgrade structure and fl awed border security “cross-border infrastructure” strategy policies is diffi cult to measure, since is to help overcome the perception the impacts are both direct, and indi- among businesses of long delays and rect, and hard to pin down precisely. uncertainty. The one major regional projection A more effective cross-border of losses, the SANDAG 2006 Border infrastructure strategy for the Wait Times study cited throughout California-Baja California region this report, may serve only as a will be anchored by three key ele- starting point for understanding ments: a) defi ning and understanding the implications of not signifi cantly stakeholders; b) building a knowl- improving border infrastructure. For edge base that consolidates existing example, it has been noted here that planning processes; and c) a deeper one additional cost of inadequate analysis of California-Baja California infrastructure may be lost opportuni- connections. ties absorbed by other regions. Along Stakeholders for cross-border the Mexican border, while Texas may infrastructure range from transporta- be better positioned in the center of tion and environmental agencies to the “NAFTA corridor,” California port of entry managers and federal has many other advantages (trained security offi ces on both sides of the labor force, technology production, border. Because there is overlap among manufacturing centers, etc.) that jurisdictions and across the border, ought to allow it to enhance its export mechanisms for cooperation—such as trade with all of Mexico. Yet its in- joint working groups—are essential complete cross-border infrastructure to infrastructure planning. However, may be exacerbating its geographic cross-border differences must be disadvantages. carefully monitored. Some of those The ever rising cross-border move- differences are diminished if there is ment of vehicles, people, and goods a solid bi-national information base. remains a land-based phenomenon This report outlines in some detail along the California-Baja California the array of plans, studies, and plan- frontier line. An innovative cross- ning processes already in place along border strategy must articulate how the border. To date, none of these highways, rail systems, and port plans or processes fully integrates the 60 | Global Crossroads

wide range of stakeholders involved 3. Baja California’s highways in border decision-making. The most should be carefully planned to comprehensive study to date, The match up with future demand California-Baja California Report fl ows into California, and the (2006) documents infrastructure optimal delivery routes to meet needs, and demonstrates huge fund- those demands. ing shortfalls for many proposed 4. A California-Baja California projects. The proposed California- rail development plan is needed. Baja California Master Plan is an Rail is an underutilized transport important positive step in creating resource along the California a working template for infrastruc- border. The rail development ture policy, and a process to involve plan will include strategies to stakeholders (the Policy Advisory embrace the new mega-port Committee). This kind of joint work- south of Ensenada, and major ing group must be sure to reach out production nodes in the region to all stakeholders. that could switch from truck to Future policy directions to im- rail transport. Further, the plan prove cross-border fl ows include the needs to address the fragmented following points: state of the current Imperial County-San Diego County line. 1. The regional highway network 5. New ports of entry must be must be rethought to make added, and existing ports north-south connections a remodeled to handle larger bigger priority. Connections volumes of cross-border move- between the immediate border ment. The current number of zone and destinations to the ports of entry cannot absorb north (especially the Los Angeles the growing fl ows of people metropolitan region) must and goods. New ports of entry be factored into planning, as should be carefully studied for cross-border fl ows (tourism, for the two major crossing points example) continue to increase. (San Diego-Tijuana-Otay; and 2. Highway infrastructure must Calexico-Mexicali), as well as be expanded, especially where one additional crossing midway freeways link up to ports of between the two urbanized entry. The state must resolve “book ends” of the border. the question of Mexican truck- 6. The connection of seaports to ers using California highways, the cross-border trade needs to and of “truck only” lanes on be better articulated. freeways. 7. The state needs to work closely with the Mexican government The California-Baja California Infrastructure Crisis | 61

to plan for the multi-billion maquila companies have con- dollar regional growth poles at sidered changing their legal sta- Punta Colonet, Silicon Border tus if NAFTA rules cut import (Mexicali), and the Tijuana- duties. Tecate highway corridor. 2. In 2006, Mexico was surpassed 8. California needs to carefully by China. See Drajem 2006. consider the negative impacts of 3. In 2005, the U.S. exported federal security and monitoring $101.7 billion in domestic policy on cross-border trade, merchandise to Mexico, while in particular, on increased wait it imported $169.2 billion. times, traffi c congestion, and This produced a bi-lateral trade the perception of delays among fi gure of $270.9 billion. Both businesses and investors. exports and imports increased by over 9% between 2004 and 2005. U.S. imports from Mexico NOTES were the result of increasing de- 1. Throughout this report, mand for petroleum, diesel, and “maquila” or “maquiladora” heating oil from its southern refers to a factory that imports neighbor. See U.S. International materials and equipment on a Trade Commission, 2006. duty-free basis for assembly or 4. While a sizeable number manufacturing, and then re- of people cross daily and exports the assembled product weekly from Baja California to typically back to the originat- California (very likely between ing country. Maquiladoras are 30,000 and 50,000), it is dif- common along the U.S.-Mexico fi cult to determine exact fi gures border, as well as in Latin for commuter workers, since at America. They often house least part of this fl ow consists of factories assembling products Mexicans with resident permits in the electronics, textile, ma- who will not admit to working, chinery, transportation, furni- as they lack the legally required ture, and food sectors. They are “resident alien” documents, of- foreign-owned, and in the case ten referred to as “green cards”. of Mexico, mainly U.S.-owned; See Herzog, 1990a and Herzog, along the California-Mexico 1990b. border, maquiladoras are also 5. Growth projections are based owned by Japanese, Korean, on past rates of growth on both Canadian, German, and other sides of the border, as well as foreign entities. It should also demographic trends plotted be noted that recently, some by planning organizations 62 | Global Crossroads

in the U.S. and Mexico. See Even the temporary downturn San Diego Association of brought on by September 11, Governments, 2006, and State 2001 did not undo the overall of Baja California, 2005. Baja success of the central bank, the statistics are drawn from the na- Banco de Mexico’s manage- tional census carried out by the ment of national monetary and National Institute for Statistics fi scal policy. Mexico’s economy and Geographical Information grew by 3% in 2005, partly (INEGI). due to the resurgence of the 6. Population fi gures in Mexican maquiladora (assembly) pro- census for border cities are gram, which directly resulted in notoriously underestimated. the 9% overall increase in U.S. The government historically has exports to Mexico. The main tended to not recognize irregular sectors exporting to Mexico settlements (colonias), and thus were transportation equipment, not fully count their popula- electronic products, and chemi- tions. Further, because Mexico’s cals, all central to the assembly political power is highly cen- industry, the primary industrial tralized in the national capital, sector that links California and Mexico City, it has traditionally Mexico. See Tomas Rivera been strategic for the national Policy Institute, 2005. government to underestimate 8. In 2004, Latino workers in the size of border municipalities, California sent $4.5 billion and thus rationalize not spend- to Mexico. The real estate ing the correct proportion of the economy is a major economic federal budget on their regional engine in California. One study needs. It is therefore diffi cult to (Tomas Rivera Policy Institute, know exactly how inaccurate 2005) estimates that the Latino the offi cial census populations population of California owns are. or pays mortgage on approxi- 7. On the Mexican side, the mately 5% of an estimated 12.2 increasing stability of the million housing units (using the national economy during the 2000 U.S. Census). This projects decade of the 1990’s has been out to an aggregated value of well documented. By the early $115 billion in Mexican owned 2000’s, the country’s annual real estate in California. GDP growth rate rested solidly 9. For example, U.S. imports from between 4 and 5%, with the Mexico refl ect escalating energy highest growth tilting toward costs and the growing demand the northern border states. for Mexican crude petroleum. The California-Baja California Infrastructure Crisis | 63

Mexico’s moderate economic Mesa East over the next decade; growth and otherwise stable a second port of entry is ex- conditions beginning in 2004– pected at Jacumba. One of the 2005 led to an increase in U.S. problems in adding new ports commitment to the assembly of of entry, or modifying existing machinery and electronic goods ones, lies with the administra- demanded in the U.S. market— tive complications created by a TV receivers, commercial and variety of public sector agencies household appliances, such as involved in permitting and ap- fl at-screen, high defi nition TV’s. proving changes at the regional, 10. These are reviewed in the state and federal levels. Like the SANDAG Economic Impacts of management of border infra- Wait Times study, see SANDAG, structure more generally, plan- 2006, pp. 17–21. ning the ports of entry needs to 11. These fi gures are aggregated be streamlined in the future. from the U.S. Department of 14. For a description of some of Transportation, Transborder these projects see Herzog, Surface Freight Data Base for 2000. 2002; cited in Haveman and 15. DHS oversees some 22 different Hummels, 2004. The authors agencies divided among four note that California’s largest areas of concern: border and land gateway, Otay Mesa sta- transport security, science and tion, ranks sixth nationally, technology, information analysis behind major access points to and infrastructure protection, Canada (Detroit, Port Huron, and emergency preparedness. Buffalo) and to Mexico (Laredo Its objectives are to manage the and El Paso). nation’s borders and ports of 12. It should be noted this data is entry, prevent the unlawful en- several years old. The volume of try of illegal persons or goods, trucks crossings along the bor- and work overseas to detect der has rapidly increased since and prevent illegal smuggling 2004/2005, to about 2 million operations. per year along the California 16. See Hutchinson, 2003. border. Data in this report 17. An interview with a former is from the last aggregated Director of one of the new bor- tables available from the U.S. der planning offi ces confi rmed Department of Transportation this. for the border region. 18. Not all the highways mentioned 13. The San Diego region will add are shown in Figure 6 one new port of entry at Otay 64 | Global Crossroads

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