When it rains along the border, millions of gallons of sewage and industrial waste from Mexican slums and factories flow down the Tijuana River into the United States and end up in the Pacific Ocean — a mess that closed the beach here to swimmers and surfers a total of 198 days last year.
The U.S. government once thought it had the solution: pay a developer an estimated $700 million to build and operate a treatment plant in Tijuana, Mexico. Under the agreement, if the plant could sell clean water to Mexican factories, U.S. taxpayers would get some of their money back by taking a share of the proceeds.
But seven years later, ground has yet to be broken. And the agreement between the U.S. and Bajagua LLC is looking more fragile than ever amid growing criticism that the no-bid contract would fatten the developer's pockets and fail to contain the sewage.
This month, the Bush administration proposed a treatment plant on U.S. soil — which would effectively kill the Mexico venture.
From the outset, state and federal regulators have had their doubts about the wisdom of the deal with Bajagua, a new partnership with limited know-how handling complicated binational projects. And government watchdogs and others have raised questions about the campaign contributions Bajagua has showered on Capitol Hill.
"This is a case of good policy being thwarted by bad politics," said Lori Saldana, a local environmental activist who is now a member of the California Legislature.
Bajagua still counts on strong bipartisan support in the San Diego-area congressional delegation, including Democratic Rep. Bob Filner, whose district includes Imperial Beach, a town of 28,000. Filner, one of the project's biggest champions in Washington, has received more than $60,000 in campaign donations from the company and its associates since 1996. In all, Bajagua investors have donated more than $100,000 to political campaigns.
Filner defends the Mexican plant as a good public-private partnership and said he was surprised by the Bush administration's move to scuttle it. He predicted Congress would rebuff the White House.
"We've already spent 10 years working on this, and it's the first real chance to clean up a problem that's plagued us for decades," Filner said.
Bajagua was founded in the late 1990s by San Diego land-use consultant Jim Simmons and Mexican real-estate developer Enrique Landa after the U.S. government stumbled in its efforts to treat Tijuana's runaway sewage.
The International Boundary and Water Commission had just built a U.S.-financed, $240 million plant in San Diego that failed to meet federal clean-water standards.
Enter Bajagua. Instead of giving the IBWC more taxpayer money to fix the San Diego installation, the company argued, the U.S. government should pay Bajagua over 20 years to build and operate a plant in Tijuana, a sprawling industrial city of 1.3 million. The plant would treat Mexican sewage, and also take inadequately treated water from the San Diego installation, clean it and sell it to Mexican factories.
"We were never going to make a lot of money treating sewage," Simmons said. "Where we make money is in producing a product, and that product is water."
EPA said idea was 'infeasible'
In 1999, the Environmental Protection Agency found the project was "infeasible" and endorsed a plan to build aeration ponds on the U.S. side of the border.
Bajagua stepped up its campaign donations and began making strategic hires in Washington. One was Brian Bilbray, a Republican former mayor of Imperial Beach who in the 1980s commandeered a bulldozer and shoveled sewage back into Mexico.
Representing Imperial Beach in Congress, Bilbray co-sponsored Filner's successful 2000 legislation to build a sewage plant in Mexico. After losing a re-election bid, Bilbray testified in Congress in support of Bajagua in 2001, without disclosing that he was a lobbyist for the company. Bilbray was elected to Congress last year in another district.
Recipients of Bajagua's donations include Bilbray; Southern California Reps. Duncan Hunter and Susan Davis; President Bush's 2004 campaign; and Democratic and Republican congressional campaign committees. Vice President Dick Cheney's office arranged meetings in Washington to smooth negotiations on the project, according to Simmons.
"To get a bill passed through the U.S. Congress requires that you talk to the lawmakers, and once you have the legislation, you need to go to the agencies to get the appropriations," Simmons said. "The IBWC gave us no direction, so we sought it out ourselves."
The Mexican government, long lukewarm toward the project, recently expressed support.
With no guarantee of U.S. government funding, time is running short for Bajagua. A federal judge has ordered that the treated sewage from the San Diego plant meet federal standards by September 2008.
And in its annual budget proposal this month, the White House included $66 million for a sewage plant on U.S. soil, next to the San Diego plant, if Bajagua fails to break ground by May 2.