Stopped at the Border
It sounded like a bad joke, but it was no laughing matter. In late 1997, Laredo City Council members considered a strange question--should local taxpayers fund portable toilets placed along a downtown stretch of Interstate 35 leading to the Juarez-Lincoln International Bridge?
The idea died within two weeks, in part because state transportation officials feared the risks of dozens of drivers rambling off from their 80,000-pound rigs to line up in front of the portable facilities. But gridlock conditions persist. Almost every day, trucks heading south are backed up from the border for five miles or longer. The interstate in the city that bills itself as a "gateway" to Mexico has become a giant parking lot, with fume-spewing 18-wheelers idling for up to six hours during the peak hours of 3-9 p.m.
In six hours, every driver knows, rigs could roll to Monterrey and back to the border. Going north, in six hours a driver could easily make San Antonio or Austin with time to spare. Instead, trucks idle, drivers wait, and so-called free trade costs more and more by the hour. Something is wrong with this picture.
Laredo, the busiest port of entry on the Texas-Mexico border, should clear nearly $21 billion in goods from Mexico in 1997. At the same time, the border has never been so congested. Rarely are more than three of the 16 lanes heading onto the main bridge at Laredo open at the same time during the day, the result of a budget and staffing cut made by U.S. Customs officials in Washington, D.C., far from the bottleneck at the border.
And Laredo is not alone. El Paso also struggles with a strained infrastructure, characterized by street congestion, lack of alternative freight routes, and deteriorating facilities.1 In fact, the Texas Department of Transportation's (TxDOT) Corridor 20 feasibility study estimated that between 1995 and 2015, border crossing traffic would increase by 128 percent along the Texas-Mexico border between Del Rio and Brownsville.
In addition, stepped-up enforcement efforts, intended to cut down on drug smuggling, have led to more frequent and longer cargo inspections on the Texas side before trucks continue through Texas (see Rolling Down to Monterrey).
Rolling Down to Monterrey
In early 1998, the picture clouded even more after Union Pacific Railroad announced it would no longer take new rail customers because of a backlog of more than 5,000 rail cars. Exporters would likely turn to trucks as the next best shipping method.2 To make matters tougher, the U.S. government threatened to cut federal transportation funds already earmarked for Laredo, El Paso, and other Texas border cities--because air pollution was on the rise.3 Worst of all, Laredo and other Texas border cities continue to be the chosen crossing points for freight haulers heading north. U.S. Customs officials indicated that more than 2 million trucks a year would pass through Laredo alone by 2010.4
Bottlenecks are hardly new along the Texas-Mexico border, either for trucks and trains or for tourists wishing they had timed their inch-by-inch crossing to avoid the draining midday heat. And the traffic jams are not just a matter of bricks and mortar; staffing shortages limit everyone's ability to cross the border rapidly. Still, the implementation of the North American Free Trade Agreement (NAFTA) in 1994 geometrically multiplied strains on border highways, roads, and other infrastructure.5
As U.S.-Mexico trade began to surge, border traffic slowed to a crawl across bridges and through ports. Less than efficient border-crossing management--the kind of thinking that shuts down lanes of traffic at peak travel times--seemed to squeeze free trade to a trickle. In addition, railroad lines, public and private airports, seaports on the Gulf of Mexico, and freight-forwarding facilities all faced costly yet necessary upgrades to handle increased daily trade.
Meanwhile, efforts were underway to get traffic moving. State transportation engineers, anticipating construction of a fourth bridge across the Rio Grande in Laredo before 2000, suggested that two bridges could handle non-commercial traffic, while two bridges far from Interstate 35 downtown could serve commercial vehicles. Another suggestion called for a multiple-lane truck queuing zone, similar to what amusement parks use to give visitors a sense of order and pace during sometimes lengthy waits.
If there is any simple message behind the border's gridlock, it is that infrastructure matters. In Border communities, and all across Texas, the systems and transmission lines known collectively as transportation infrastructure are a vital underpinning for trade and economic prosperity. The importance of infrastructure also springs from the fact that individuals, families, and small businesses cannot usually afford to build ports, roads, rail lines, and highways for themselves. Such "public works" serve vast public needs. Economists, in fact, have noted that a shortfall in public works amounts to a "third deficit," after budget and trade imbalances. To defer investment in infrastructure, they say, is to hinder production and shipping, weakening the economy.
Given the continuing surge in border traffic, what might be done today and in the years ahead to improve the Border region's infrastructure? What steps can Texas and federal authorities take to break up bottlenecks and help trucks and passenger vehicles get on their way? What novel practices in other states might help Texas carve out its appropriate role as a leader in efficient international trade?
Border Infrastructure Before NAFTA
In the past century, U.S. customs facilities have sprung up in Brownsville, Laredo, and El Paso, each an outpost of culture and commerce even before colonial times. Rail and road bridges across the Rio Grande, inspection stations, airports, and highways throughout the Border region have all been built over the years.
Something else has changed, too. NAFTA has contributed to remarkable growth in border trade and generated infrastructure pressures that local residents have struggled to relieve.
Trade along the border has been building up far longer than the few years since NAFTA. In 1962, for instance, Mexico created the National Program for the Development of the Border in an effort to industrialize its northern border. But Mexican colonias multiplied more quickly as companies rushed to build maquiladoras in Mexican border towns, offering wages lower than the U.S. minimum but higher than the Mexican average. Through the 1980s, maquilas fueled rapid growth, crowding Mexican border towns even more.
During the same period, traffic began to choke the Border's trade routes and overwhelm local byways, causing costly shipping delays and raising concerns about the inadequacy of Border infrastructure. State and local leaders, as well as many private companies, began demanding better roads and bridges to ease trade, tourism, and the daily trips across the border so common among local residents. As a result, for instance, Laredo investors built the Camino Colombia private toll road to detour traffic away from the overcrowded downtown crossing.6
In 1988, Congress recognized rising demands by approving the Southern Border Capital Improvement Program, calling for $357 million to improve Border infrastructure. No sooner had the program been approved, however, than talk in Washington and Mexico City turned toward NAFTA. Suddenly, all estimates of how much it would cost to prepare Border communities for additional trade were out of date.
As NAFTA passed from notion to fact, increased trade underscored the need for additional bridges across the border, new and expanded customs facilities, and highway and road repairs. Mexican officials signaled their intent to improve the federal highway from Laredo south to Mexico City, highlighting both its central role in expanding free trade and Laredo's significance as an international distribution port.
In 1992, the U.S. General Accounting Office (GAO) and the Border Trade Alliance, which is devoted to encouraging border growth, identified nearly $1.5 billion in capital improvements (see Figure 6.1). Their calculation took into account NAFTA, unlike the 1988 underestimate of infrastructure needs.7
Border Infrastructure After NAFTA
After NAFTA took effect January 1, 1994, U.S. tariffs on a broad range of trade goods disappeared overnight, with all tariffs scheduled to be phased out by 2009. Northbound traffic through South Texas increased substantially after the agreement took effect, with an undeniable, if unmeasured, impact on Texas and U.S. roadways (see Tables 6.1 and 6.2). From 1990 through 1996, northbound truck traffic increased by nearly 30 percent.8 Total vehicle crossings leaped more than 40 percent, and pedestrian crossings went up 10 percent. Put another way, during 1996 more than 2.8 million truck, 33 million car, and 15 million pedestrian crossings were made over the Texas-Mexico border through 11 major Texas ports of entry.
As trade pressures increased, traffic congestion became the most obvious and persistent infrastructure challenge along the border. By early 1998, Border leaders conceded that local highways and roads were not handling the surging traffic efficiently. Nor were roads, bridges, and highways expected to improve any time soon. At a 1996 Cuatro Caminos conference, Nuevo Laredo's mayor, Antonia Garcia, estimated that NAFTA was tripling traffic through her city.
"NAFTA has not brought as many benefits as problems yet," the mayor said.
Like their twin cities across the river in Texas, Mexican border towns were not improving or expanding infrastructure fast enough to accommodate growth. In 1996, Manuel Cavazos Lerma, governor of the Mexican border state of Tamaulipas, forecast that his state would need to double its roads, bridges, and water supply every four years to keep up with infrastructure demands.
State of the Border Transportation Infrastructure
Texas' highway system and ports of entry are a critical part of NAFTA trade. While planes, trains, and boats carry freight between the U.S. and Mexico, 80 percent of all U.S.-Mexico trade moves by truck. Texas is one of the shortest and most common routes to Mexico.
Texas has more border crossings into Mexico than any other state and the most miles of rail track, but some infrastructure is inadequate to handle the increasing volume of trade with Mexico. Texas bridges and border crossings, already some of the busiest in the U.S., are operating at capacity.9
By early 1998, Mexican motor carriers had applied for permission to operate in the U.S. in accordance with NAFTA provisions that allow freight carriers from both nations to travel freely in the other country. But a December 1995 start date set by NAFTA was postponed indefinitely by U.S. officials, who cited concerns about safety, illegal drugs, and potential damage to infrastructure due to an expected increase in traffic. After all, the number of truck crossings into Texas from Mexico increased by more than 321,000 from 1992 to 1996.
Differences in U.S. and Mexican commercial trucking regulations and operating practices could threaten the safety of U.S. highways and related infrastructure, according to a 1997 GAO study. Among regulatory differences, the study states, American truckers are required to keep logbooks, or hour-by-hour manifests of their driving work days, but Mexican drivers are not. Moreover, Mexican regulations do not limit the number of hours a driver can be on duty, while U.S. regulations require that after 10 hours, a driver must be off duty for at least eight hours.
The GAO report notes that Mexican trucks are not required to have front-wheel brakes and are permitted up to 97,000 pounds of gross vehicle weight, while U.S. rules require front brakes and limit gross weight to no more than 80,000 pounds. A 1996 study by the Texas Transportation Institute found that trucks carrying 84,000 pounds of cargo accelerate damage to road pavement by a factor of five, as compared to trucks at the legal limit. In such cases, highways designed to last 40 years might have to be replaced in eight years.
Other cargo concerns center on the safety of transporting hazardous materials, such as corrosives, poisons, radioactive material, and flammable liquids, from Mexican trucks to U.S. border warehouses.
The GAO report also identified violations by Mexican trucks within the Border's commercial zone, within an area 17 to 20 miles of the border. For a three-week period in December 1997, some 56 percent of 1,613 Mexican trucks, routinely inspected by U.S. Customs and observed by GAO officials, were placed "out of service" because of violations serious enough to preclude the truck or driver from heading down the road. Common violations included broken suspensions, substandard tires, faulty or inoperable brakes, and overweight or unsecured cargo, including hazardous materials. Some 14 percent of drivers who were stopped had invalid U.S. commercial driver's licenses.
During 1994, the Texas Department of Public Safety (DPS) conducted 2,893 inspections of Mexican motor carriers in the 14 Texas counties immediately adjoining the border. Nearly 2,100, or 73 percent, had at least one out-of-service violation, meaning that overweight or unsafe truck violations were occurring along the border. In the same period in the counties, 2,728 U.S. motor carriers were inspected, of which 995, or 37 percent, had at least one out-of-service violation. The numbers show that Mexican truckers violated U.S. trucking regulations more often than did their U.S. counterparts.10
In an effort to reduce out-of-service violations, DPS's License and Weight troopers began conducting training sessions with Mexican truckers. Under a U.S. Department of Transportation pilot project to streamline enforcement of commercial vehicle safety, DPS trained Mexican truck owners, mechanics, and drivers on the vehicle inspection procedures. All four U.S. border states were involved in the project. DPS officials reported that the training sessions eased friction between the industry and law enforcement. DPS also trained Mexican Federal Highway Police Academy instructors in performing inspections of commercial vehicles operating in Mexico.11 The inspection procedures were incorporated into Mexico's highway patrol academy training.
One aspect of cross-border truck traffic may be obsolete after the U.S. government lifts its suspension of NAFTA's trucking-related provisions. Drayage--the use of a transfer shipper to haul cargo from one nation's warehouse area to a bordering nation's warehouse area--needlessly complicates and delays international trade along the border. In most cases, transfer shippers or drayage trucking company drivers take trailers from a warehouse on one side of the border and transfer it to a warehouse on the other side, in the meantime spending several hours idling in long lines of trucks waiting to cross the border. Numerous resources are wasted: vehicles are out of service, drivers must be paid, cargo must be insured, diesel pollution is generated, and payments made 15 to 30 days after delivery are delayed.
Chapter 12 of NAFTA would eliminate drayage. But until the U.S. government lifts its suspension of the trucking-related NAFTA provisions, drayage delays will continue. Once the suspension is lifted, the cost of border trade and the amount of border congestion should decline.
Bridges and Roads
Twenty bridges, two dam crossings, and one ferry crossing carry trucks and cars across the Texas-Mexico border, a total of 23 ways to cross. This represents more bridges than the other three U.S. states on the border combined.12 Fourteen bridges are owned by local governments, two bridges and two dams are owned by the U.S. government, and three bridges and the ferry crossing are owned by private entities. Rail-only bridges include one each in Eagle Pass, Laredo, and Presidio, and two in El Paso (see Map 6.3).
Despite a limited number of rail crossings from Texas into Mexico, and the concentration of the control of these crossings in the hands of even fewer rail carriers, rail crossing options may become even fewer in the near future. On April 17, 1998, the South Orient Railroad Company, Ltd. notified the U.S. Surface Transportation Board that it intends to abandon its route from San Angelo to Presidio. If carried out, this action would not only close one of Texas' links to Mexico, but more importantly restrict rail competition in the Mexican market to an even smaller number of competitors.
The lesson seems to be that additional bridges ease traffic woes, but only if they are used. While some border bridges have excellent connections to major highways, others do not (see Table 6.3). Despite the long wait at Laredo-Nuevo Laredo's Juarez-Lincoln International Bridge, for instance, many truckers have resisted using the Laredo Solidarity Bridge, built in 1991, because it is 15 miles from main highways and connects to roads that are considerably worse.13
Toll roads, well developed in Mexico, are a costly alternative. In January 1997, the Texas Transportation Commission granted Camino Colombia, Inc., the right to build a 22-mile toll road to connect Interstate 35 in Laredo with FM 1472 (Mines Road) near the Colombia Solidarity toll bridge. The eight-lane bridge, jointly owned by the Mexican government and the City of Laredo, has been under-used because of inadequate connecting roads. Construction of the planned toll road, designed as a controlled-access, four-lane divided highway, is scheduled to begin by 2000.14
Only one-third of Mexico's 29,000 miles of federal roads and highways are paved. But drivers can use the newest highways, resembling U.S. highways, by paying tolls of up to 55 cents per mile.15 Such charges mean the 180-mile trip from Laredo to Monterrey costs nearly $100 for 18-wheelers (see Map 6.4).
In January 1997, Mexican President Ernesto Zedillo inaugurated what he called the "NAFTA highway" to boost trade between Mexico and the U.S. The president dedicated 62 miles of the highway, a stretch running through the state of San Luis Potosi, about half-way between Mexico City and Laredo. He also announced that the Mexican government would spend another $38 million to complete the highway. By 1998, truckers were moving about 160,000 tons of products along the partially renovated highway each day. Put another way, the new road today carries about half the cargo running between the U.S. and Mexico.16
Texas highways, not surprisingly, account for the most trucks carrying trade between the U.S. and Mexico, and Interstate 35 is the most heavily traveled highway segment for truck traffic.
Border by Rail
Border by Boat
Improvements in border transportation infrastructure may lie in technology capable of enhancing inspections and routing traffic away from congestion.
Among the options, Intelligent Transportation System pilot projects speed government reviews of truckload information. The Automated Export System (AES), a single data collection and processing center for electronic export shipment documentation, is expected to be in place by 2000 at several border crossings. AES is designed to allow one-stop export filing, better tracking of trade statistics, and by 2000, "paperless" reporting of export data. The AES is also expected to reduce filing burdens imposed by multiple agencies.
Established in 1995, the AES was expanded to U.S. seaports nationwide by October 1996. The system is currently operational at all ports, including air, rail, and truck transit ports. AES is not yet accepting data for air, rail, and truck carriers, but it will be accepting air and rail transportation data by the end of 1998 and truck transportation data in 1999, according to U.S. customs officials. Customs and census officials will have spent approximately $13 million to develop and implement AES between 1992 and 1997. Also, both agencies together plan to spend an additional $32 million through fiscal 2002 on implementation and maintenance.
AES should yield another benefit for exporters: the AES Post-departure Authorized Special Status (AES-PASS). This pass would give companies with excellent export compliance records more post-departure filing privileges; AES-PASS participants would be required to send only their company identification number and a shipment reference number before departure, with detailed reporting required about twice each month.
A joint venture between the U.S. Customs Service and the U.S. Census Bureau has begun accepting letters of intent from AES-PASS exporters. AES-PASS has undergone many significant revisions. Under an earlier proposal, exporters would have been required to fill out an application to qualify for AES-PASS. As amended, however, the program allows applicants to make requests in their initial letters of intent to join AES. As long as a company does not have a history of export license violations, it will be informed within 30 days whether it has been accepted by various federal agencies.17
Through 1997, less than 1 percent of all export data was submitted through AES. Although Customs anticipates an increase in its use, a GAO study has identified private sector concerns with the costs of automation and pre-departure procedures inconsistent with business practices.
The North American Trade Automation Prototype (NATAP) may also provide new benefits. U.S. Treasury officials have said that the system can collect tolls and road taxes automatically without requiring drivers to stop their vehicles. The system also performs safety record checks automatically and reduces documentation for international trade accounts. Also, once the equipment is in place along highways, trucking companies would be able to track their vehicles and cargo electronically.
By July 1997, NATAP was available at two Texas-Mexico border crossings. The Colombia Solidarity bridge in Laredo and the Ysleta-Zaragosa bridge in El Paso each have one lane designated for NATAP processing. But Treasury officials said that it did no good to harmonize data among nations if governments failed to change rules and procedures to take advantage of technologies.18
Scattered State Offices
At least five Texas state agencies play traffic enforcement roles along the Texas border, but their activities are generally uncoordinated.
Most notably, DPS enforces size and weight limits on commercial vehicles at eight weigh stations in the Border region, but stations are not always open. DPS also enforces safety inspections for hazardous materials, truck and vehicle safety, vehicle registration, and fuel permits. Other relevant agencies include TxDOT, which handles vehicle registration and insurance; the Texas Comptroller of Public Accounts, whose enforcement division addresses fuel permits and state taxes; the Texas Natural Resource Conservation Commission, which deals with hazardous waste shipments; and the Texas Department of Insurance, which regulates insurance providers. Significantly, however, these state agencies with border roles have no central facility to perform their duties.
While all commercial vehicles entering Texas from Mexico must pass through a U.S. Customs Port of Entry (POE), it is difficult to inspect for all state regulations. Yet, while Texas state agencies could likely perform their border-related duties at stations much like the Customs POEs, only the DPS is permitted to use them due to limited space. DPS officers also assist U.S. Customs inspectors with safety inspections.
There may be a West Coast solution. In 1996, California developed an approach that saved money while boosting the number of inspectors at two major border crossings.
Drawing from $30 million in federal and state funds originally earmarked for road construction, the California Department of Transportation (CalTrans) built one-stop truck inspection facilities in Calexico and Otay Mesa. As of 1996, the facilities employed 47 full-time inspectors, including 23 California Highway Patrol officers and 24 civilian truck inspectors, whose salary, training, and benefits cost the state less than the highway patrol officer training.
The civilian inspectors are trained to do many of the duties previously performed by highway patrol officers. Trucks from Mexico crossing at Calexico or Otay Mesa are weighed and inspected for safety. Drivers are checked for appropriate licenses and vehicle registrations, and file insurance papers and purchase fuel permits before heading north.19
By establishing the new inspection centers, California appears ready for the next phase of NAFTA implementation, when U.S., Canadian, and Mexican freight companies will have unrestricted access to the other countries' highways.