This city has built a mass transit system without a nickel from the federal government.

Known here as the "Tijuana Trolley," the system is to begin operating in late July, on time and on budget, serving a 16-mile route between downtown San Diego and the Mexican border. Local officials are so pleased that they are talking of building a line that would connect downtown and the city's eastern suburbs.

The $86 million light-rail project was funded by the state gasoline tax, with some help from a .25 percent local sales tax.

It is the first trolley system built in the United States in a generation and the country's cheapest mass transit system, in terms of dollars per mile, in 40 years. It cost only a little more than $5 million for San Francisco's Bay Area Rapid Transit system and $43 million for Washington's Metro.

The basic fare is $1, although those using the trolley in the downtown area alone will pay just 25 cents.

The city already owned 14.2 miles of track that once belonged to the San Diego's biggest factories, through its southern suburbs and stopping 200 feet from the Mexican border, provides the bulk of the trolley line.

To complete the line, the transit development board had to install 1.7 miles of traditional track along city streets. An overhead electric wire will provide power.

The two-car trains will make the trip in 33 minutes. The bus takes 77.

The cars, with a starter fleet of 14, were built by Siemens-DuWag of Dusseldorf, at $8000,000 apiece.