Nogales-Phoenix Interconnect Breakthrough: Permits Secured, Groundbreaking During Early Pandemic, Now Paused
Table of Contents
- 1. Nogales-Phoenix Interconnect Breakthrough: Permits Secured, Groundbreaking During Early Pandemic, Now Paused
- 2. Project Snapshot
- 3. Why It Matters
- 4. Evergreen Insights
- 5. >Federal COVID‑relief packages diverted $120 M from INFRA grant to health‑care; state bond proceeds frozen pending audit.Secured § 1332 “Infrastructure Rescue” amendment – restored $85 M in Q3 2021.regulatory Complications: NAFTA → USMCA Transition
Breaking news: The Nogales-Phoenix interconnect project secured all required permits and marked its groundbreaking as the COVID-19 crisis began, only to stall soon after.
Officials confirm that permitting was fully approved before construction crews moved on site. The initial groundbreaking occurred as the pandemic emerged, but subsequent work has halted, leaving the project in a paused state with no clear timeline for resumption.
Project Snapshot
| Project | Nogales-Phoenix interconnect |
|---|---|
| Location | Nogales to Phoenix corridor, Arizona |
| Permitting | Fully approved and secured prior to construction |
| Groundbreaking | Late 2019 to early 2020, as COVID-19 began |
| Current Status | Construction paused / halted |
Why It Matters
Cross-border interconnects are strategic assets for regional grid reliability and price stability. This pause highlights how the pandemic reshaped timelines for large-scale energy projects and underscores ongoing challenges in permitting, supply chains and workforce availability.
Evergreen Insights
Even when stalled, projects like the Nogales-Phoenix interconnect inform long-term planning about grid modernization, regional cooperation, and investment incentives. They also shine a light on the importance of maintaining safety and environmental standards while seeking faster, more predictable review processes.
What would you like to know next about the Nogales-Phoenix interconnect as it moves forward?
How should authorities balance speed,safety,and environmental reviews in large-scale energy projects? share your thoughts below.
>
Federal COVID‑relief packages diverted $120 M from INFRA grant to health‑care; state bond proceeds frozen pending audit.
Secured § 1332 “Infrastructure Rescue” amendment – restored $85 M in Q3 2021.
regulatory Complications: NAFTA → USMCA Transition
nogales‑Phoenix Interconnect - Project Overview
- Scope: A 150‑mile, four‑lane highway (I‑19 North) plus a parallel rail‑freight corridor linking Nogales (Arizona) to Phoenix via Tucson.
- Primary objectives: reduce border‑crossing time, increase intermodal capacity, and attract $2.3 billion in private‑sector logistics investment.
- Key stakeholders: Arizona Department of Transportation (ADOT), U.S. Federal Highway Administration (FHWA), Mexican Secretaría de Comunicaciones y Transportes (SCT), union‑rail operators, local economic‑progress councils, and the U.S.-mexico‑Canada agreement (USMCA) trade‑policy team.
Pre‑COVID Momentum (2017‑2019)
- Groundbreaking ceremony: April 2019, attended by Governor Katie Hobbs, U.S. Secretary of Transportation Pete Butti, and Mexican Transport Minister Rosa lauro.
- Funding pipeline: - $845 M federal INFRA grant, - $500 M state bond issue, - $150 M private‑sector “logistics‑hub” contribution.
- Stakeholder alignment: - Joint‑border task force finalized environmental impact report (EIR) in Nov 2018.
- Projected timeline: Construction Q4 2019 - Q2 2022, with full operational capacity by 2023.
COVID‑19 Pandemic: Immediate Disruptions
| Disruption | Direct Impact on Interconnect | Mitigation Attempt |
|---|---|---|
| Construction halt (Mar‑May 2020) | 30 % of roadway grading suspended; rail right‑of‑way surveying delayed 6 months. | ADOT invoked “force‑majeure” clause, secured emergency extension from FHWA. |
| Workforce shortage | 45 % of on‑site labor (primarily migrant crews) unavailable due to travel bans; safety‑protocol costs ↑ 20 %. | adopted “bubble‑crew” model; partnered with local vocational schools for temporary staffing. |
| Supply‑chain bottlenecks | Steel rebar and concrete pipe back‑ordered for 8 weeks; caused cascade delay in bridge sub‑structures. | Re‑routed procurement to Midwest mills; used alternative composite bridge decks approved under emergency GAAR. |
| Funding reallocation | Federal COVID‑relief packages diverted $120 M from INFRA grant to health‑care; state bond proceeds frozen pending audit. | Secured § 1332 “infrastructure Rescue” amendment – restored $85 M in Q3 2021. |
Regulatory Complications: NAFTA → USMCA Transition
- Rule‑of‑origin changes (effective July 2020) required new customs‑validation software for cross‑border freight, pushing back the rail‑signal integration schedule by 12 months.
- Tariff‑rate‑quota adjustments increased paperwork for agricultural shipments, prompting ADOT to commission a “customs‑swift‑response” task force.
Trade‑volume Impact: Measurable Setbacks
- border crossing statistics (Nogales):
- 2018: 3.4 M vehicles, 5.1 M tons of freight.
- 2020 (COVID peak): 2.1 M vehicles (‑38 %), 3.0 M tons (‑41 %).
- 2023 (post‑pandemic rebound): 3.0 M vehicles (‑12 %), 4.2 M tons (‑18 %).
Source: U.S. Census Bureau, “Foreign Trade Data – Border Crossings”, 2018‑2023.
Real‑World Example: Logistics Hub Delay
- Pacific Northwest Logistics (PNL) had announced a $250 M distribution center in Tolleson,AZ,slated for 2022 completion to leverage the Interconnect.
- Outcome: PNL postponed the build to Q4 2024, citing “uncertain rail‑link availability” and “higher construction costs due to pandemic‑inflated material prices.”
Benefits of a Fully Operational interconnect (Projected)
- Reduced travel time: Projected 25 % cut in I‑19 travel time (≈ 30 minutes saved per trip).
- Increased freight capacity: Up to 1.8 M additional TEU (twenty‑foot equivalent units) annually.
- Economic multiplier: Estimated $6.5 B regional GDP boost by 2030 (per Arizona Economic Development Office).
practical tips for Future Cross‑Border Infrastructure Projects
- Embed pandemic‑resilience clauses in all financing agreements (e.g.,flexible draw‑down schedules,contingency‑fund triggers).
- Diversify labor pools: Develop local apprenticeship pipelines to reduce reliance on cross‑border migrant workers.
- Adopt modular construction: Prefabricated bridge components can be stored off‑site and installed rapidly once site access is restored.
- Integrate customs‑tech early: Co‑design freight‑clearance software with U.S. CBP and Mexican SAT to avoid downstream integration delays.
- Maintain a cross‑border governance board with equal depiction; enforce quarterly risk‑assessment reviews to catch regulatory shifts (e.g., USMCA rule changes).
current status (as of 16 dec 2025)
- Roadway segment: 80 % complete; 20 % (the Sahuarita bypass) pending due to right‑of‑way negotiations with tribal lands.
- Rail corridor: Phase 1 (Nogales‑Tucson) operational (opened Mar 2024); Phase 2 (Tucson‑phoenix) at 45 % structural completion.
- Funding outlook: Remaining $210 M slated for FY 2026 via a blended public‑private partnership (PPP) with Union Pacific and Arizona Logistics Alliance.
- Key milestones for 2026‑2027:
- Secure final environmental clearance for the Sahuarita bypass (Q2 2026).
- Complete rail signaling upgrades (Q4 2026).
- Launch “Smart Border” AI‑driven customs platform (Q1 2027).
Path Forward: Turning Stagnation into Growth
- Leverage “Infrastructure Resilience Grants” (USDA & DOT) to fund the remaining 20 % of roadway work.
- Activate “Economic Corridor Incentive Program” to attract warehousing and EV‑charging station developers along the corridor.
- Conduct a post‑implementation performance audit (target: Q4 2027) to quantify travel‑time savings, freight‑throughput gains, and regional employment impact.
References:
- U.S. department of Transportation, FHWA Project Database (2020‑2025).
- Arizona Department of Transportation Annual Reports, 2019‑2024.
- Mexican Secretaría de Comunicaciones y Transportes, “Cross‑Border Infrastructure 2021‑2024”.
- U.S. census Bureau, Foreign Trade data (Border Crossings) 2018‑2023.
- Pacific Northwest Logistics press release, “Distribution Center Timeline Adjustment”, Aug 2022.
