Toll road to Mexico takes bumpy detour Superhighway is sold for $12 million

January 7, 2004

JOHN W. GONZALEZ, Houston Chronicle San Antonio Bureau Staff

LAREDO - After three years of disappointing traffic, the $90 million Camino Colombia Toll Road , the state's first and only private superhighway, was sold at foreclosure auction Tuesday for $12 million.

One of the project's lenders, John Hancock Life Insurance Co., purchased the 21.8-mile road after the Texas Department of Transportation declined to bid any higher than $11.1 million.

Camino Colombia Inc. failed to keep pace with $75 million in outstanding loans that were granted in 1999 amid rosy projections linked to the North American Free Trade Agreement.

The highway has remained open despite its long-apparent fiscal woes, but its future is uncertain. Meetings on whether to keep the road open started after the afternoon auction.

Camino Colombia uses the Solidarity Bridge northwest of Laredo to connect Texas with the heavily industrialized Mexican border state of Nuevo Leon, which has only a narrow strip of land touching the Rio Grande. For $16 for trucks and $3 for passenger vehicles, the highway has enabled motorists to circumvent the often-clogged arteries that pass through Laredo and its four international bridges.

But many truckers, balking at the tolls, found alternate routes to skirt Laredo and its Mexican counterpart, Nuevo Laredo, Tamaulipas.

In 2002, officials said car volume was meeting expectations, but they conceded that truck traffic was not, and since 2003 there has been talk of selling the road and related facilities. Webb County continues to look at the right-of-way for a possible new rail line into Mexico.

In addition to $75 million in loans from John Hancock and New York Life Insurance Co., the road was opened in October 2000 with $15 million from local investors, including $6 million from the International Bank of Commerce, led by Tony Sanchez.

When then-Gov. Ann Richards refused to back the project plans in 1994, Sanchez aligned with her successful re-election challenger, George W. Bush, who did.

In a 2002 interview with the Houston Chronicle, Camino Colombia President Carlos Y. Benavides III said delays that he blamed on the Richards administration added $25 million to construction costs. Delays in building the corresponding highway and infrastructure in Mexico also hurt the bottom line, although Benavides predicted "we could turn the corner in a heartbeat."

That never happened, said county spokesman Raul Casso.

"We have a ghost highway now," said Casso, chief of staff to County Judge Louis Bruni. And while state and county officials want the road kept open, the community wouldn't be crippled if it were closed, Casso added.

"It's already hardly used anyway," he said.

An official of the Texas highway system said the state advocates keeping the road open.

"We're sorry that it came down to this for the owners of the toll road , but nonetheless, it's a transportation asset. However you cut it, it's a road on the ground . . . and we certainly don't want to see any road closed," said transportation department spokesman Gaby Garcia.

---

CAMINO COLOMBIA TOLL ROAD

Opened: October 2000

Purpose: Speed traffic to and from Nuevo Leon, Mexico, and reduce congestion in Laredo and Nuevo Laredo, Tamaulipas.

Initial cost: $90 million

Estimated debt: $75 million

Tolls: $16 for 18-wheelers, $3 for cars

Developer: Camino Colombia Inc.