The Border Highway Connector project that would link Santa Teresa to Sunland Park and improve commercial access to El Paso is at risk because state funding has not covered a design-driven cost increase, New Mexico officials told the Transportation and Infrastructure Subcommittee during a Santa Teresa site visit. Gerardo Fierro, executive director of the New Mexico Border Authority, said the project is at roughly 90% final design and that the estimated cost has risen from an initial $80 million estimate to about $170 million.

The shortfall follows a $45 million USDOT Infrastructure for Rebuilding America (INFRA) grant awarded earlier; Secretary of Transportation (NMDOT) briefed the committee that the federal grant requires the state to obligate matching funds by a deadline in September or risk losing the award. "The project is closer to $170,000,000. So that's created a pretty large funding gap," a Border Authority official said. The department told lawmakers it is exploring options with the Federal Highway Administration.

Why this matters: the connector is designed both to shorten travel times (project proponents said it could save as much as 40 minutes on trips to El Paso) and to relieve pressure on other crossings if commercial traffic shifts. Committee members and presenters said the Bridge of the Americas will be closed to commercial traffic when construction begins there in 2027, sending more trucks to regional ports and local roads.

Project status and timeline: presenters said right-of-way work and rail agreements are in final stages and that construction letting was expected around the end of the calendar year or into the next year, with an approximate two-year construction window after letting. The Border Authority described prior state investments in feasibility, environmental and preliminary design work, and noted an earlier federal award of $45 million toward construction that carries the obligation deadline.

Funding history discussed with the committee included prior state proposals for one-time appropriations and legislative action during the last session. Presenters said a governor's executive budget had included $150 million in one-time cash for District 1 projects, with the connector a priority, but that funds were redirected when a planned bond package did not clear the Legislature. Committee members and presenters said additional federal, public–private partnership and other financing options are being explored.

Local officials highlighted related investments in cargo runway work, port operational needs and water and wastewater projects that they said must accompany transportation improvements to realize expected economic returns. "We need investments on transportation, for our communities," the Border Authority executive director said.

Ending: Officials asked the committee to consider near‑term funding options and coordination steps with federal partners to meet the obligation timeline and avoid losing the INFRA award. The DOT secretary told the committee the department is pursuing alternatives but warned of "very high risk" of losing the federal award if the state cannot obligate required matching funding by the September deadline.