U.S. Tunnel Outlook

The U.S. tunneling industry has seen a wave of activity in recent months regarding large-scale projects, with even more looming on the horizon. Decades-in-the-making projects including the Gateway/Hudson Tunnel Project and Second Avenue Subway in New York have been making headway, while multi-billion programs in Baltimore and San Jose are moving ahead.

Some examples of the recent activity include:

• On February 6, Amtrak announced that it has reached a major milestone with the selection of Kiewit/Shea Joint Venture to build its new Frederick Douglass Tunnel in Baltimore, the key component in its $6 billion reconstruction and upgrade program.
• On January 22, New York Governor Kathy Hochul announced that the New York Metropolitan Transportation Authority awarded a contract to C.A.C. Industries for a utility relocation project in advance of the Second Avenue Subway Phase 2 major works, a $7-plus billion extension to Phase 1 that opened in 2017.
• On November 30, officials gathered in New Jersey for a ground-breaking ceremony for the Tonnelle Avenue Bridge and Utility Relocation project, a part of the Gateway program which includes the long-awaited Hudson Tunnel Project. Five out of nine contemplated Gateway/Hudson Tunnel Project contracts are in procurement or construction (as of November 2023).
• On November 6, 2023, the Santa Clara Valley Transportation Authority announced that the nearly 54-ft diameter TBM (the second largest ever in North America) was order as part of its $5.5 billion BART Silicon Valley Phase 2 project.
• On October. 6, 2023, DC Water announced that it selected CBNA/Halmar JV as the contractor for its Potomac River Tunnel project. At $819 million, it is believed to be the largest wastewater contract awarded in the United States.

Expected to occur later this year are the award of the tunnel contracts for both the Hudson Tunnel Project and Second Avenue Subway Phase 2. Of course, this is in addition to a host of other transit, CSO, water and other projects across the country.

Federal Funding

One of the driving factors behind the implementation of some of these major initiatives has been an influx of federal funding. In November 2023, the U.S. Department of Transportation’s Federal Railroad Administration announced it awarded $16.4 billion in funding for 25 passenger rail projects along the Northeast Corridor (NEC), a railroad line running between Boston and Washington, D.C. This particular line is one of the highest volume passenger rail corridors in the world and the busiest in the United States, with hundreds of thousands of daily riders.

Among that $16 billion was up to $3.79 billion in funding for the Gateway Program’s Hudson Tunnel Project Systems and Fit Out. The project includes final design and construction of the Hudson River Tunnel project and rehabilitation of the existing 113-year-old North River tunnels. Construction will include installation of track, signals, traction power, ventilation, fire and life safety systems, and other necessary systems work in the new Tunnel. As matching funds, the Gateway Development Commission (GDC) will provide approximately $950 million as part of a financing package through DOT’s Railroad Rehabilitation and Improvement Financing (RRIF) loan program. For the larger Hudson Tunnel Project: FRA has committed an additional $912 million through Amtrak; FTA has determined a contribution of up to $6.88 billion under their Capital Investment Grants program; USDOT has provided $25 million through the Rebuilding American Infrastructure with Sustainability and Equity (RAISE) program; and GDC will provide additional RRIF funds as part of the financing package.

Another large chunk, up to $4.7 billion, was set aside for Amtrak’s B&P Tunnel Replacement Program, which includes the construction of the new Frederick Douglass Tunnel. The proposed project includes final design and construction of the new tunnel to replace the Civil War-era Baltimore and Potomac tunnel. The project involves the construction of a new two-track tunnel for passenger rail use, three ventilation facilities, and an approach track. The project also reconstructs associated railroad and roadway bridges in the project area and rebuilds the West Baltimore commuter station to accommodate the new railroad alignment and upgrade the station to fully accessible high-level platforms. Upon completion, speeds along this segment will increase from 30 mph to 110 mph, eliminating the slowest section of mainline track between Washington, D.C., and New York City. The tunnel is used by Amtrak’s intercity services and Maryland Area Regional Commuter Penn Line service.

Separately, FTA on Nov. 4 signed a $3.4 billion Full Funding Grant Agreement, part of the Capital Investment Grant program that received record funding under the President’s Bipartisan Infrastructure Law. The funding will help support the 1.8-mile extension of the Q line along the east side of Manhattan to 125th Street, relieving overcrowding on the Lexington Avenue Line, which transports 200,000 riders per day and is the most heavily used transit corridor in the United States.

While these projects directly involve tunnel projects, funding for high-speed rail could be a further driver for the U.S. tunnel market as these networks begin to take form as tunneling will be needed in urban and mountainous terrain.

In December 2023, the U.S. Department of Transportation awarded the California High-Speed Rail Authority (Authority) nearly $3.1 billion in grant funding for continued progress on the country’s first electrified 220-mph high-speed rail system. This is the largest grant the Authority has received and was made possible by the Infrastructure Investment and Jobs Act. While the grant funding is for the at-grade Central Valley section, connections toward San Franciso at the north end of the alignment and toward Los Angeles at south end of the alignment would likely require significant tunneling. Assuming the successful startup of this high-speed network, it seems likely we could see further high-speed deployment elsewhere in the country, where ideas for this type of network have been floated for years.

A positive sign on this front is the Brightline West High-Speed Intercity Passenger Rail project that would connect Las Vegas, Nevada, and Southern California. The 218-mile, high-speed rail line will primarily run along the surface of the I-15 median with trains capable of reaching 186 mph or more, cutting the trip to two hours – half the time to travel by car. On Jan. 23, 2024, DOT announced the approval of $2.5 billion in private activity bond allocation toward the $12 billion project. DOT previously approved a private activity bond allocation of $1 billion for Brightline West in 2020, bringing the total allocation for this project to $3.5 billion. In December, DOT also awarded a $3 billion grant from President Biden’s infrastructure law to the Nevada Department of Transportation for this project.

In terms of other transit projects, plans are underway to expand the LA Metro system, with proposals including varying amounts of tunneling, while Seattle Sound Transit is planning its next phases – the West Seattle Link Extension and Ballard Link Extension, both of which include tunneling in their preferred alignments. On the Ballard Link project, a downtown tunnel would be at the heart of the project.

Water/Wastewater Tunnels

CSO tunnels have been a staple of the U.S. tunneling industry dating back to the days of Chicago’s Tunnel and Reservoir Plan. Tunnels to capture combined sewer overflows have been completed throughout the country, with current programs in full swing in Cleveland, Indianapolis and St. Louis, as well as second-tier cities including Ft. Wayne, Indiana, and Akron, Ohio.

These tunnels promise to play a heavy role in the foreseeable future with continuing plans for upcoming works. The newest system is ramping up in Pittsburgh as part of the $2 billion Allegheny County Sanitation (ALCOSAN) Clean Water Plan. That program comprises three tunnel segments:

• Ohio River Segment (3.8 miles of 18-ft in diameter and 1.1 miles of 14-ft in diameter); Construction start: 2025
• Allegheny River Segment (6.2 miles, 18-ft in diameter); Construction start: 2027/28
• Monongahela River Segment (5.4 miles, 18-ft in diameter); Construction start: 2030/31

Additionally, the Northeast Ohio Regional Sewer District has two more large CSO tunnel projects in development (Southerly Storage Tunnel and Big Creek Storage Tunnel), while St. Louis’ Project Clear has three large tunnels in the works (Lower & Middle Des Peres Storage Tunnel, River Des Peres Tributaries CSO Tunnel, Upper River Des Peres CSO Storage Tunnel).

As mentioned earlier, DC Water recently announced the award of the Potomac River Tunnel contract, the last major tunnel as part of its Clean Rivers Program, while Akron announced the award of the $215 million Northside Interceptor Tunnel, the second of two CSO tunnels for the Ohio city.

Work is currently winding down on projects in Dallas, Indianapolis, Hartford, Connecticut, and Ft. Wayne, with tunneling work underway on Alexandria, Virginia’s RiverRenew tunnel, Columbus, Ohio’s Lower Olentangy Tunnel, and the Narragansett Bay Commission’s Pawtucket Tunnel in Rhode Island.

Upcoming wastewater projects include the CSO Control Parallel Interceptor in Newark, New Jersey, and the 2-mile-long, 12-ft diameter Cemetery Brook Tunnel in Manchester, New Hampshire. On the drinking water side, programs include the $1.6 billion Horizon Lateral for the Southern Nevada Water Authority, and the $1.9 billion Kensico to Eastview Tunneling and Facilities Upgrade Project for the New York DEP in Westchester County.

Resiliency

As we continue to see increasing severity of storms and weather events across the country, the need to build infrastructure to provide resiliency is also growing. A recent case in point is Houston, which, according to the National Hurricane Center, sustained $125 billion in damages as a result of Hurricane Harvey in 2017. Planners from the Harris County Flood Control District are studying a plan that would build on the order of 10 miles of large-diameter tunnels, at a cost of $1-1.5 billion, to help contain the impacts of future storms to safeguard the metropolitan area.

In Boston, planners from the Massachusetts Water Resources Authority are similarly planning a large-scale project to help protect its drinking water system. The MWRA Redundancy Tunnels would see the construction of some 14 miles of water tunnels, at a cost of about $1.5 billion, to ensure reliability of drinking water to residents in the greater Boston area. The project was precipitated by a 2010 water main break that had an estimated economic impact of approximately $310 million per day.

The Delta Conveyance Project for the Department of Water Resources (DWR) includes a tunnel through the Sacramento-San Joaquin Delta that is designed to protect water supplies from sea-level rise and saltwater intrusion into the Delta. Additionally, the project will help to reduce the risk associated with earthquakes, improve water supply reliability, and reduce impacts on local Delta communities and fish. The project, originally envisioned to include twin tunnels, is being redesigned as a single-tunnel plan. In December 2023, DWR approved the project, and will now work toward obtaining the necessary state and federal permits. In the meantime, it is working on a revised cost estimate and update cost-benefit analysis, which is expected in mid-2024.

And, the Hudson Tunnel Project will address the issue of resiliency as it will allow the refurbishment of the existing Hudson tubes that were originally opened in 1910 and severely damaged as the result of Superstorm Sandy in 2012. With both tunnels operational, the impacts of outages will be reduced as traffic can be routed. Today, outages along this line result in severe economic impacts. According to the Gateway Development Commission, 10% of United States’ GDP relies on this vital connection of the Northeast Corridor.

Looking Ahead

The projects mentioned above are an incomplete list; several other transportation, water, wastewater, energy transfer, and other projectss, are in various stages of planning. A quick sum of the projects in construction that TBM: Tunnel Business Management tracks shows that there is approximately $18.9 billion of tunnel-related construction ongoing in the United States, with the upcoming work totaling $75.5 billion. It is important to note that some of the figures used reflect the estimate for the entire program, not just the tunneling portions. The Gateway Program, for example, is estimated at $16 billion, but tunneling, although a significant portion, is only part of the overall program. For simplicity and consistency, we included the program total. However, projects like the Sound Transit and LA Metro expansions, do not have published estimates and were not included. And, as stated, this list is not comprehensive. The upcoming projects total considers only those projects with published estimates and well-defined tunnel schemes.

With the amount of work underway and on the horizon, the industry seems poised for growth in the near future.

2023 Tunnel Watch List

The Tunnel Watch List was developed by UCA of SME to highlight upcoming important tunneling and underground construction projects in the United States. The list is intended to raise awareness of these projects in the eyes of decision-makers. The list is developed and curated by a committee based on national and regional needs, as well as social, environmental and economic impacts. Below is the 2023 Watch List: