Imagine if someone were to move into your house without paying rent, consequently making your food, water and electric bills more expensive. Adding insult to injury, the freeloader turns out to be a multi-millionaire who argues he does not have to pay rent because your parents own the house.
As absurd as it sounds, a similar situation is threatening to derail an airport terminal and border crossing project linking Otay Mesa with Tijuana International Airport. Unlike American airports, which are managed and operated by local governments, the majority of Mexican airports are managed by private corporations.
One of the project’s primary investors, Mexican airport management company Grupo Aeroportuario del Pacífico currently operates Tijuana International Airport without paying property taxes to Tijuana’s municipal government. Tijuana Mayor Carlos Bustamante has taken a stand against this injustice by stalling the project’s approval until GAP agrees to pay property taxes.
GAP argues it shouldn’t have to pay property taxes because the airport is on federal land. This argument reveals a flaw with Mexico’s government: its structure is too centralized, which hurts local governments. Because local governments in Mexico must get approval from their state legislatures to issue their own taxes, many have to rely heavily on the federal government to provide them revenue. This makes it nearly impossible for local governments to generate revenue or benefit from major projects, such as the Otay Mesa terminal. Tijuana is trying to resolve the issue in Mexican courts, but a favorable ruling is unlikely given the rampant corruption in Mexico’s judicial system.
Bustamante isn’t against the project. He knows it would boost the local economy by increasing international commerce. What he is against, however, is a giant corporation making fat profits by freeloading on the local government. Bustamante wants Tijuana to get its fair share of the deal by ensuring filthy rich investors on both sides of the border will make massive profits. He’s taking a stand for the right of local governments to collect their own taxes and generate their own independent revenue stream. It’s the same as asking your neighbor for a share of the profits from the lemonade stand he wants to set up on your property.
GAP should not be complaining about having to pay property taxes to the Tijuana municipal government. The corporation has a total revenue of $304.1 million and oversees almost every major airport on Mexico’s West Coast. It can easily afford to pay property taxes and shouldn’t be freeloading when its airport lies inside Tijuana’s municipal boundaries. If GAP wants to be an ally of Tijuana, it should pay its fair share of taxes to the city, considering it operates the airport serving it. GAP’s business partner, Equity Group Investments, will have to pay business and property taxes to San Diego City and County, respectively, but the company isn’t moaning about it.
It would be a disgrace for a project benefiting both sides of the border to be derailed by GAP’s corporate greed. This project would ease overcrowding at Lindbergh Field and make border crossings easier by decreasing wait time of three hours to cross at San Ysidro. GAP would be one of the primary beneficiaries with an estimated 1.1 million new customers coming to its airport. The profit from all these new customers will outweigh any property tax GAP would have to pay to Tijuana.
We need a new airport terminal and easier access to the border, and all the partners involved should be able to benefit financially from the project.
This should include businesses, customers and local governments. It will improve relations on both sides of the border where cooperation is needed. Paying your fair share to your local government is a responsibility for both individual citizens and private businesses.
