Rosarito Informs Expats About Future Plans

Several representatives from the City of Rosarito met with the local citizens at the monthly FRAO (Foreign Relations Attention Office) breakfast meeting in November to discuss the future of Rosarito. The commissioners are taking opinions from foreign residents on matters that affect them. Mayor Mirna Rincon has made an effort to consult with foreign residents during her term in office, seeking their opinions on matters that would improve Rosarito. Known as the “Urban Development Program of Playas de Rosarito,” the effort is only in its initial stages, and the results of residents’ opinions today will make a difference in the in the direction of Rosarito’s short- and long-term future.

The survey is available online in Spanish at www.implanrosarito.mx. To obtain a copy in English please contact the FRAO office via email at FRAO@rosarito.gob.mx or through their Facebook page. The City would like to collect everyone’s response before the Christmas break, so get a move on! The City wants to hear from you.

Representatives from IMPLAN (the City Planning Commission) and COPLADEM (Committee Planning for Municipal Development) gave presentations on the future of Rosarito. Mayor Rincon was unable to attend, as she had her hands full with a few new “arrivals’’ in town. It was her wish to “put in touch the foreign community with the government of Rosarito, and vice versa.” But she has placed great importance on making Rosarito comfortable for Mexican and foreign residents, and that all cultures are to be celebrated. The security of Rosarito’s residents is of utmost importance, but there are other areas of concern.

The City, State, and Federal entities have a planning framework equal to the Constitutional extents of government; City is three years, with State and Federal being six-year terms. These are all short term planning periods. Urban development plans and programs have a planning framework of 15 – 20 years, exceeding the periods of all elected officials. This is sometimes where projects get a bit screwy. Let me direct your attention to the Machado Bridge. I’m not sure where the current “plan” came from, but I saw a rendition many years (and two mayors) ago, and the site showed a beautiful Los Angeles style cloverleaf of on and off ramps… totally maneuverable.

About that bridge… at this time the City is waiting for the State and Federales to fix the bridge, its ramps, and bring the whole area up to safety code. The Mayor and the City of Rosarito will not accept the bridge until everything is fixed and made usable, including handicap accessibility. The importance here is that the City does not want to be held liable legally for problems associated with the bridge. This is what the “hold up” has been; a big stalemate.  In the meantime, the City is being punished and people are getting hurt with the mismatched road markings and directions.

Other problems cited by residents were the deplorable shape of roads in the Primo Tapia/La Mision area of the city and the green plastic headlight-diverting barriers set up between Rosarito and Puerto Nuevo. Any roadway, signage, or traffic concerns may be directed to City Hall and the Roads department, or by contacting the FRAO office.

Regional and State planning include the planning for the two basic areas of Rosarito, the Playas de Rosarito Urban area which is about 27% of the physical area, and the Primo Tapia Population Center, including a new side bridge, which is basically everything south of the ‘’city’’ and incorporates the remaining 71% of the “suburban” zone. I’m not sure what happened to the remaining 2%…just blame it on the New Math.  On the horizon is a new branding of the Primo Tapia area, “Rosarito South”, which will be receiving upgrades in the future (one of the long-term plans). And in case you are wondering, the City of Rosarito includes six districts, 19 sectors, 69 boroughs, and 116 neighborhoods. A detailed map is available in the Planning Office, but it is nearly impossible to decipher.

The City’s new policies are focused on population growth, which globally could potentially double by the year 2050. Currently there are nearly two million inhabitants in the Tijuana area (which includes Rosarito), and another 3.2 million in San Diego, which means over five million people in the bi-national metropolitan area.

The Rosarito administration unveiled 17 Sustainable Development Goals of the New Urban Agenda, which include focus on the family unit, food production, education & literacy, intelligent urban planning, and sustainable power sources. Human principles being focused on include equality, democratic transparency, urban safety, accessibility and environmental sustainability.

Reflections on the Baja 1000

Congratulations to Justin Morgan of El Cajon, CA, whose Honda (Pro Moto Unlimited Class) crossed the finish line 28 seconds ahead of Second Place Winner Cameron Steel of San Clemente, CA, in his SCORE Trophy Truck.

In all, there were 285 entrants, most of whom were from SoCal, although there were a few from widely scattered places such as Las Vegas, NV, and other regions such as Utah, Alabama, Colorado and New Mexico, plus Mexicans from places such as Mexico City, Puebla and yes, Ensenada!

The Baja 1000 is a grueling event, and the only vehicles that make it to the finish line have been constructed to withstand severely rigorous conditions. It’s not a sport for the faint of heart: The drivers take a beating along with the pounding endured by their cars or trucks.

Not everyone affected by the presence of the racers and their entourages is a fan of these events (the Baja 1000 is held annually in mid-November, while the Baja 500 begins May 30th and ends June 3rd), but like it or not, these events appear to be traditions that are here to stay.

In their defense, they bring a voluminous amount of revenue to the city coffers. The hotels, motels, restaurants, cafes and bars are filled to capacity, prior to and during the events.

Contrarily, they cause local traffic mayhem that raises the blood pressure and tries the patience of the local residents, who still have to go to work, school or place of worship, and have to do so in many instances by adjusting their schedules and their usual routes. Blvd Costero (the coast road), from Playa Hermosa to the end of town is the focal point of the race, and is especially constricted in the area bordered by the Riviera, CEARTE and Museo Carocol. That’s where the racers set up their trailers and pits and retail kiosks. Local vendors also set up food carts. Musicians roam the area. Foot traffic is heavy, vehicle traffic is highly restricted.

As a result, many motorists choose to use alternate roadways, such as Pedro Loyola and Reforma, thereby causing congestion on those arteries as well.

Ultimately, there is a traffic burden testing everyone’s patience from Zona Centro to Playa Hermosa, and all primary routes into and out of  the city.

I used to experience angry meltdowns when caught in one of these traffic traps, but eventually I learned to roll with it.

Now I actually enjoy the festive atmosphere and the period of lucrative exchange that the local vendors enjoy serving our strange but wealthy visitors from other worlds.

The operative word is “wealthy.” In case you hadn’t noticed, the vehicles that are trailored into town to compete in these big events are expensive, and their entourages include pit crews, mechanics, family members, support vehicles carrying spare parts, etc.

The drivers themselves are either rich and/or have sponsors with deep pockets.

Anyway, my change of heart came about a couple of years ago. I was in the parking lot of a Calimax in Zona Centro, preparing to use their ATM, when one of those monster trucks pulled up next to me and parked.

When its driver went into the store, I got out of my car to take a close look at the thing, marvelling at all the expensive hardware adorning it. I noticed a skinny, pimply-faced teenage boy sitting shotgun, watching me gawk at the truck.

“Wow, quite a machine,” I offered.

“Yeah, it’s my Dad’s! He’s really proud of it. He works on it all the time. It’s kind of his hobby,” the little geek replied.

“Hobby?!?” I thought. “Wow…”

Well, who am I to judge? There’s nothing wrong with being wealthy and building a great big gas-guzzling monster truck, is there?

And heck, who’s to blame the guy for taking it to a foreign country, tearing up a few thousand acres of desert, perhaps accidentally killing a few indigenous and/or domesticated animals (and the occasional human being), for sport and profit?

Welcome to Baja! Thanks for coming! See y’all in a few months, when we can all share and enjoy the desert together.

Mexican Gas Stations Seeing Changes

Costco opened its first gas station in the state of Guanajuato this week, its fourth in Mexico. The spiffy new station cost $3.3 million. They’re selling Costco’s Kirkland Signature gasoline brand, and sure it comes from the States, but so does most gas. Mexico has very little refining capabilities. Maybe that goes a long way toward explaining the cost of a gallon of gas costing about $3.65 a gallon.

The company assured customers that they will get what they pay for and won’t be short-poured here. Yes, he actually said that, acknowledging the elephant in the room where gas is sold. They will only accept credit or debit cards and members who use their Costco credit card get a 3% discount.

Meanwhile, The British oil and gas company BP continues its expansion into Mexico by opening its first ToGo convenience store in this country, where it also introduced its Wild Bean Café to customers. This station is in Guadalajara. The new store and its coffee is part of a strategy to transform the concept of service stations in Mexico, now that stations other than Pemex are allowed. BP operates the Wild Bean Café brand in 1,200 convenience stores in 11 countries. In Mexico, the company has more than 350 gas stations. And looking at the overall picture, it does appear that BP’s convenience store is a lot nicer than the OXXO’s.

Meanwhile, stodgy old Pemex appears to be running scared, as the government-owned oil company is sporting a new look. The new gas station design was officially inaugurated last week in the state of México. Poo. Always at the end of the line, Baja doesn’t get anything cool.

The head of the company’s industrial transformation division said the new design will be incorporated at 45 stations this year, eight new ones and 37 boring old stations will be renovated. Carlos Murrieta Cummings said the new concept “is intended to maintain the franchise’s leadership in the domestic market.” See? They just admitted they’re running scared.  “The new image breaks with the conventional and projects a new Pemex: a highly competitive business in an open market,” he said in the announcement.

Murrieta added that the new design reflects an eagle in flight, “a leader, strong and agile, with its wings extended towards new challenges.” Murrieta also said the company’s objective is to provide the highest standards of customer service, offering its clients experience, reliability, modernity and innovation. Ha ha ha! Since when? Since President Pena Nieto broke Pemex’s stranglehold on the gas monopoly and invited in competition! Since then they’re trying a tiny bit harder. They’re still short-pouring and short-changing, and they’re still losing buckets of money.

Well, the general manager of the first Pemex franchise to sport the new look did say its sales have doubled since the new design was incorporated in mid-June. With prices fixed, maybe appearances and service do count.

FRAO Office Brings Charities Together

Representatives of several of Rosarito’s charity organizations gathered together in the last FRAO (Foreign Residents Assistance Office) meeting to speak a few words regarding their functions. Robin Gunther was concerned that Rosarito’s 2012 Animal Law was not being enforced, which stated that tiny puppies would no longer be sold along the roadside. Baja California Spay & Neuter educates children in animal care, so that they are more aware of how to treat dogs and cats. To this date more than 20,000 animals have been spayed or neutered by this organization, and they receive no money from the City.

Susan Smith informed all about the Flying Samaritans mission to provide health care to over 300 persons a month who cannot obtain health care anywhere else. All doctors and volunteers are just that, volunteers. All money is from memberships, donations, and special events. Jackie Alameda mentioned that the Annual Baja Blues Fest provides funds for education, food, and transportation to many of Rosarito’s children. They also help with documentation for those deported into Mexico with no identification paperwork.

Jim Henshaw, soon to be elected to President of the United Society of Baja California (USBC), identified this group as being the hub of charities for the Rosarito area, and that the Society supports two students in medical university at this time. Mary Moreno, president of Cruz Roja Voluntarios Americanos of Rosarito described that all money received from the Rosarito Thrift Store goes to the Rosarito Cruz Roja Hospital and ambulance service and have just expanded the size of the store. Jeff Failing of Rosarito Sister Cities informed everyone that Sister Cities has been around since President Eisenhower’s creation in the 1950’s, and fully operated by unpaid volunteers, supplying police cars, vests and accessories to the police department, and books to children, pairing Rosarito to Cities in the US and around the world.

Dolly Duff took a few moments to introduce everyone to the DACA Dreamers Assistance Project that focuses on women and young adults who have been deported into Mexico with absolutely nothing, including identification, but primarily asks them to voluntarily deport themselves; and offers them housing, mentoring, job placement and skills to allow them a life in Mexico until they can legally return to the United States via Visa in the future. Mavourneen O’Brien mentioned a few words about the Club de Ninos y Ninas who supervise about 80 children aged 6 – 12, in the afternoons who have no other supervision. Volunteers with a hobby, talent or passion to share are encouraged to spend an hour a week sharing this entity with the children. They are now totally solar-powered.

FRAO meets every month, 10 am on the third Thursday at the Calafia Titanic Room (except December). The FRAO office is located on the ground floor of City Hall, room 108, open Monday – Friday, 8am – 3pm; 661-614-9600, ext. 1080. The office can help you with services including obtaining a driver’s license; residency, answer legal questions, and solve problems.

One of the main motives for this assembly was for foreign residents to complete a five-page survey entitled the “2018 Public Consultation.” Questions covered the topics of development in housing, business, government, and other factors. The survey is available online in Spanish at www.implanrosarito.mx. To obtain a copy in English please contact the FRAO office via email at FRAO@rosarito.gob.mx or through their Facebook page. The City would like to collect everyone’s response before the Christmas break, so get a move on! The City wants to hear from you.

Santas Needed!

This is the time of year to be thinking about giving. If you are still looking for a group worthy of your hearts and thoughts this holiday season, please consider adopting a Kumiai (Kumeyaay) or other local family for Christmas. There are 65 families in the Kumiai community, an Indian reserve one hour into the hills above La Mision, and so many other families also in the hills that have no one to think about them.

Food boxes will feature chicken, fresh produce (purchased the day before delivery), and dry goods, priced at $20. Blankets are $10. Or you can make up your own gift box of food, goods, and gifts, and bring to one of the drop off locations. In return, you will receive a Christmas Thank You card and photo from the family you have helped. You are even invited to accompany Sara and group to San Jose de La Zorra to deliver the holiday gifts.

The deadline is near! The last day to adopt a local or Kumiai family is December 10! For additional information, contact Sara Vega at 661-850-4855 or email to saraenmovimiento@hotmail.com, or contact her on Facebook on either of the pages “Sara Vega” or “Sara.enmovimiento.”

There are several ways to donate to this philanthropic cause: Cash donations may be made through PayPal by contacting Sara at her email address. Or you may make a donation at any local OXXO, into the account 4766-8403-0084-5794. Save your donation receipt and send a photocopy to Sara so she knows whom to thank.

You may donate non-perishable food items, blankets, jackets, or any other winter-related item to either Charley’s Place (k 37) or Betty’s Burgers (on the boulevard just south of the 7-11 / cuota on and off ramps.

Anyone wishing to join the caravan to the Kumiai camp, contact Sara Vega ASAP for cabin reservations, instructions, and logistics of the trip.

The need of the people is great and varied. If you are building your own donation box and in need of suggestions, please contact Sara. Merry Christmas!

Should You Get Dentistry Here?

Mexico is touted as a great place to get dentistry done, and most of that touting is from the industry itself. But that doesn’t mean it’s not a great savings or it’s not safe, it just means slow down and do your due diligence. Find out who you’re going to trust your health to. Make no mistake, just because your mouth is kind of on the edge of your health, it is still your health. We know a woman who got a tooth so badly infected the pain went into her neck and shoulder and she went to a chiropractor, not even realizing the pain started in her mouth. It took her almost a year to find a doctor who figured out it was coming from an infection in a tooth she had had work done on in a Mexican border town.

The cost here is a fraction of what it is in the States, and you need to ask yourself why? OK, so we’re asking: Why? Because these dentists don’t carry insurance. Fine, if nothing goes wrong.

Another reason for cheap dentistry is they pay such low wages. As a friend and business owner told me when I complained about his lousy service, “Sorry about that but I pay peanuts, so I get monkeys.” Do you want someone making way less than $1000 a month drilling holes in your gums? Fine, that’s understandable. Dentistry is costly, we get that.

Reason three that dentistry is cheaper here is that most Mexicans can’t afford to pay even the price you think is so cheap. Therefore, dentists are hungry for business from foreigners. The price you’re chortling over is a godsend to them.

Do they have the same training as US dentists? No.

There were 83 dental schools registered in the last official national count in 2007. Half are public, half are private. Admission to dental schools in Mexico requires a high school diploma, and to obtain a license in Mexico, dental students must complete a 3 to 5 year program plus a year of community service. But this  is scary: No formal nationwide standard curriculum exists, so who knows if your dentist went to a Mickey Mouse stay and vay or to a tough school where they had to learn their craft? And did you just notice we said that dentists here have four fewer years of school than US dentists? Of course a case can be made that those four years our dentists spend in college before they get to dental school are wasted since they never see a tooth.

There are 195,000 dentists in the US, and 153,000 dentists in Mexico. There are 312 million Americans and 129 million Mexicans. Clearly there are too many dentists here, especially considering how many of the very poor people never open wide for a dentist.

So, why are so many Mexican dentists trained in the United States? Look closer to that diploma on the wall they’re so proud of, especially if it says graduated from a US school. Most of them are a course lasting a week or two on a specialty. No doubt the dentist wants to improve his craft, but being able to say he’s US trained makes that couple weeks a very good investment.

And who over sees dentists in Mexico? Nobody. In the US, a dentist must pass three tests in the state he/she intends to practice in and show a hepatitis B test, finger prints, a course in infection control, and oh yes, “be of good character” whatever that entails. And they belong to the American Dental Ass., a trade organization where you can start the process of complaint.

Good luck suing a Mexican dentist if something goes wrong. There is no tort law in this country. (Tort law provides relief to injured parties for harms caused by others, and to impose liability on parties responsible for the harm).

All of this sounds negative and is not meant to be, it’s just a counter point to the one big, huge, and very good reason to get dentistry done here: Price. You can save a bundle.

Big Fines for Small Tools

Drones can invade privacy, they can cause accidents, they annoy birds, and they can really piss off pilots in actual airplanes. They can also be incredible tools for scientists, photographers, and anyone in the tourism industry. In some countries, licenses are required. The International Civil Aviation Organization insists on a license too. And, of course, there are regulations. But that doesn’t stop anyone from buying a drone off the internet, and those drones are high-tech.

For example, the DJI Phantom 4 is a model from a few years ago but still very popular. It fits into a piece of hand luggage. It has the ability to fly 20 meters per second, reach 6000 meters above sea level, and fly for about half an hour on a single battery. The drone costs around 840 USD. The DJI Inspire 2 is an up-to-date professional machine. It also has a flight time of about  half an hour, but a range of 7 km and a max speed of 58 mph. Inspire 2 costs a little over 2,700 USD. As tools, these drones have great potential. Their cameras are capable of getting great still shots as well as video.  Mexico has some rules on the books in regard to flying drones, but now the government is pushing ahead, full throttle.

New regulations, which go into effect in December this year, will require all drone users to obtain a license. However, getting that license might be tricky. First, you must be 18 years or older, then you need to be Mexican by birth (sorry Gringos), you need to provide your military release card, have a high school diploma, and be in good health. If those rules don’t sound ridiculous enough, then the fine that goes along with flying without a license (in a country that hardly gives out parking tickets), is enough to have you rolling on the floor.

If the police catch you flying, and you can’t show your license, you’ll be fined as much as 20,000 USD. Of course, you could probably give the officer a few 500 peso notes and a quick flight lesson and everyone will walk away with smiles.

The Mexican government has identified a problem: Drones have the capability of killing people in manned aircraft, so they are taking steps to solve the problem. But more than likely a cop will not even stop you, especially if you’re in the middle of the desert 100 kilometers from the nearest town. The police need to cover huge spaces with few resources (they most likely don’t have a drone).  Also, they probably have better things to do, like setting up speed traps to catch unsuspecting Gringos. Although it might not be completely necessary, it’s always good to follow the rules when in another country. And that’s our disclaimer.

Mary Moreno, CR Rosarito President; Contractor, Luis Boroquez; Maricella Maciel, Hospital Representative; and Board members Terry D’Angona and Jerry Allen.

Cruz Roja Rosarito Thrift Store Expands

The sign in the store reads “Come in – we are awesome.” And they are — the Cruz Roja Voluntarios Americanos of Rosarito at the Rosarito thrift Store want you to know that they are going through a bit of an expansion in the next few weeks, but are still open for business!

In October, the Cruz Roja Voluntarios Americanos presented a check to Servicio Boroquez to start work immediately on a new storage room . With the Cruz Roja Hospital’s blessing, about 100 square feet of storage space will be added to the west side of the existing thrift store. The new space will be used to house items being stored for special events, such as the Dama’s Christmas Bazaar, and the Annual Cruz Roja Fashion Show.

By moving the “special items,” more space will become available for the volunteers to process donations of housewares, clothing, and books, and to place them in the shop for sale quickly. The Thrift Store runs on minimal overhead so that more of the money gets to the hospital, which responds to more than 300 emergencies monthly.

The expansion was introduced to the members at the monthly general meeting, and was met with full support. The Thrift Store is open Monday through Saturday, 10 am – 3 pm. Annual membership is a mere $20 per person, and the benefits include a 10% discount on Cruz Roja hospital services, and a 50% discount on ambulance trips to the US border. General meetings are held on the second Thursday of the month at 10 am at Popotla Restaurant. If you have large items, you may even call for a pick up: 661-623-3455.

So How Is The Average Jose Doing?

Defining the size of Mexico’s middle class is more complicated than it is in the United States, where it is a more straightforward measure of family size and income, with data gathered by the U.S. Census Bureau and other sources. Mexico is a far less transparent country.

So economists have measured the country’s middle class by other means — access to household goods or health care, consumption levels, access to credit, education, food security. It’s a politicized statistic, because Mexican politicians and commentators tend to pick the yardsticks that best suit their agendas, depending on whether they want to depict the country as better off, or mired in poverty. There’s a lot of fake news out there.

But the expansion of Mexico’s middle class over the past several decades is an undeniable trend. In 1960, some 80 percent of Mexicans were living in poverty. Today, the national average of “working poor” households (those that work but still can’t provide sufficient income for a family´s minimum food requirements) among Mexico’s 31 states is 40 percent. Baja California Sur has one of the lowest working poor rates in the country, at just 19 percent. While Mexico’s inequality gap remains wide compared with more developed countries in Europe and Asia, that gap has not increased in recent years as rapidly as it has in the United States. Meanwhile, Mexico’s working class appears to be floating upward on a rising tide: GDP per capita has increased from $7,357 in 1990 to $9,009 in 2015 (the most recent data available). That is a real gain, because inflation is under control.

The Organization of Economic Cooperation and Development, a group of 34 developed economies, considers Mexico to be 50 percent middle class, based on median incomes. Then there’s another gauge: self-perception. According to surveys, 65 percent of Mexicans see themselves as middle class.

One result of having a small middle class is there is a small pool to pull from for middle management. Middle management comes from the middle class. Case in point:

A restaurant will be founded by a rich guy. He’s not going to run it, he’s usually got other businesses and other interests. Who does he get to run it? There are no educated and trained middle managers, so he pulls one of his waiters out of the lower classes and calls him a manager. He has no idea how to manage, he doesn’t have the education, experience, or cultural background. And this is why Jose can’t get the tacos to the table before they get cold. It’s a lack of middle class/middle management.

Mexican Land Trusts, Big IRS implications

I was intrigued by a recent presentation by a Mexican bank on the subject of Fideicomisos (land trusts). By way of a quick primer, ownership of real property in the “restricted zone” (100 km from borders, 50 km from shore) by a foreigner must be done through a Fideicomiso.

As it turns out, Mexican banks have a monopoly on this Fideicomiso business. The bank’s role is to hold the title to property on your behalf. One can direct the disposition of the property; sell, give away, or otherwise encumber the property. ‘Fidos’ are good estate planning vehicles from the Mexican perspective. At death, the property is transferred via the trust, perhaps a more efficient mechanism than Mexican probate.

Some banks appear to be pulling out of the “fido” market. When I asked why, I was told there is increased emphasis on anti-money laundering compliance by bank regulators, which to me means there may be a new spotlight on this market segment.

One of the reasons I attended was to see how much awareness there was on the part of bank officials on the federal income tax aspects of Fidos.  None. Zilge-ola. That means you, the person who may need to enter into a fido to own property, must pay special attention, because the bank won’t tell you.

Here’s the rub. What may work from a Mexican perspective may be sheer disaster from a U.S. tax perspective. Properly structured fidos (meaning they meet IRS requirements) are deemed to be “disregarded entities,” and the IRS will not bother you. When they are not, they become IRS ‘radioactive’. They become reportable foreign trusts. Every time there is an IRS reportable ‘anything’ you have better had done it right from the beginning.

“Good” fidos have only one property in them.  At the presentation it seemed like it was common to add more than one property per fido. Again, ok from the Mexican point of view, but runs afoul of IRS ‘safe harbors’. In fact, bank officials later confirmed they gladly would add properties to an existing fideicomiso, for a fee.

Another trait of “good” fidos:  They do nothing but hold title to property. Be wary of the bank doing other things for the property; managing it, paying taxes or other things. The IRS does not like that.

Food for thought:  New owner, new trust, or just substitute the name? Does one inherit the federal tax troubles of the last fido owner?

Orlando Gotay is a California licensed tax attorney (with a Master of Laws in Taxation) admitted to practice before the IRS, the U.S. Tax Court and other taxing agencies.  His love of things Mexican has led him to devote part of his practice to federal and state tax matters of U.S. expats in Mexico.  He can be reached at tax@orlandogotay.com or Facebook: GotayTaxLawyer.  This is just a most general outline. It is informational only and not meant as legal advice.

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