Escaping the “polluter pays” trap: Financing wastewater treatment on the Tijuana-San Diego border

Building and operating infrastructure to address transboundary environmental hazards requires dividing the cost of pollution prevention between bordering states. When cost-burden questions arise, the solution often suggested is the “polluter pays principle” (PPP). However, when political and economic relations between neighboring countries are asymmetrical other cost-burden principles are often adopted. Given the discrepancy between theory and practice, the aim of this study is to identify some of the available cost-burden principles and to examine when they might replace the PPP. The pollution-prevention regime along the San Diego/Tijuana border is used as a case study. It was found that under asymmetrical relations there are several competing cost-burden principles. Some principles are adopted since they are perceived, by some, to be fair while others are adopted since they provide effective wastewater treatment. The ones that were found effective are those that offset, to some degree, existing asymmetries. This explains why the PPP was replaced in the San Diego/Tijuana case with other cost-burden principles that better offset the asymmetries and thus, they provided a more effective wastewater treatment than the PPP.