Nogales struggles with image, economy

NOGALES — Gael Sylvia Pullen said her McDonald’s franchise a five-minute walk from the pedestrian port of entry in Nogales is doing pretty well, all things considered.

But she only needs to look down the road to find reason for concern: a Wendy’s, Sonic and Hometown Buffet have gone out of business over the last year.

“For those of us in the border region, we’re impacted by two recessions,” said Pullen, who with her husband, Mark, owns three McDonald’s franchises around Nogales.

In addition to the wider downturn, businesses on both sides of the border here are reeling from the peso’s devaluation, long lines in each direction at the ports of entry and H1N1 flu fears that are curtailing travel, Pullen said.

Travelers also are required to have a passport to get back into the United States.

Most of all, Pullen said, businesses are hurting because of media coverage of drug-cartel violence that has fewer people from the U.S. and Mexico coming to and through Nogales.

Pullen decided it was time for border business owners to band together to search for solutions.

“This problem is too big to realistically expect any one person or position to solve,” she said. “We have to collectively collaborate in seeking solutions and be the force of change that we need to see happen.”

She organized the Bi-National Business Leadership Economic Summit, inviting government officials, politicians and business owners from the U.S. and Mexico to an August meeting in Tubac.

She expected about 30 people; nearly 200 showed up, include state Attorney General Terry Goddard.

Members of a coalition that grew out of the summit are addressing four major issues affecting border business owners: policy, infrastructure, capital and image.

One group is working with public relations representatives to present a positive view of border communities and to promote festivals and cultural events.

“It’s safe,” said Bruce Bracker, a coalition member who operates a clothing store near the pedestrian port of entry. “I cross at least once a week to have lunch.”

“We want to get across the idea that we are much more than how we’ve been portrayed in the media,” said Clara Milton, co-owner of Green Valley-based Argonaut Tours and a participant in the summit. “We are a place for families.”

The company, which specializes in travel to Mexico, has had to lay off four of its six full-time employees since last fall, when the State Department issued a warning about travel to Mexico’s border region, said Stuart Milton, its founder.

“We don’t have similar warnings for communities in the United States,” Milton said. “We don’t have similar warnings for going out to eat in South Tucson, but Nogales is safer than South Tucson, statistically speaking.”

Before the summit reconvenes this fall, another committee will compile information about infrastructure needs and the impact of government policy to present to Homeland Security Secretary Janet Napolitano.

The area will get a boost as the Nogales-Mariposa Port of Entry breaks ground on an expansion in late October that will take it from four to 12 lanes, cutting down on lines in both directions. The project is using about $200 million in stimulus money and is expected to be finished in 2012.

“It’s a starting block for this area,” said James B. Manson, chairman of the Greater Nogales and Santa Cruz County Port Authority.

The group’s first summit drew representatives from other border communities in Arizona and in other states. They included Carl Hargrave, owner the Hometown Buffet that closed here. He came from Calexico, Calif., where he operates another Hometown Buffet.

“As far as the summit goes, we applaud it,” Hargrave said. “One of the things we see is uniting efforts of all of the border cities across the regions, from Texas to San Diego, so we can get our elected officials to understand the economic impact.”

Carlos Velez-Ibanez, a professor at Arizona State University’s Department of Transborder Chicana/o and Latina/o Studies, said that border violence needs to be addressed before the area’s economy recovers.

“It won’t be fixed so long as there is a drug market in the U.S. that fuels racketeering and cartels,” Velez-Ibanez said. “There’s a buildup of fear, all of these exacerbated problems, and the ones who pay the piper for it all are in fact the small businesses.”

But Pullen said business owners need to do everything they can now to get customers to return.

“We want them back, we welcome them back,” she said. “We miss them and we need them in order to continue our survival.”

OVER THE BORDER

24 million people crossed the border from Mexico to Arizona from July 2007 to June 2008.

The largest economic impact of Mexican visitor spending was in Pima County, followed by Maricopa and Santa Cruz counties.

Mexican visitor spending generated nearly half of all taxable sales in Santa Cruz County, where Nogales is located.

Leisure, such as shopping, vacations, visiting friends and relatives and personal health accounted, for nearly two-thirds of travel from Mexico. Business-related reasons accounted for most of the rest.

Ninety-nine percent of visitors to Arizona from Mexico were from the state of Sonora, just on the other side of Arizona.

Source: University of Arizona’s Eller College of Management, 2008