The Santa Clara Valley Transportation Authority (VTA) board of directors has voted to ditch Kiewit Shea Traylor JV (KSTJV) as the tunnel contractor for BART Silicon Valley Phase II (BSVII).

The board’s vote on June 27 follows KSTJV presenting cost proposals that significantly exceeded project budget limits.

The matter, which was unanimously approved by the BSVII Oversight Committee earlier this month following a review of the project’s current delivery strategy, aims to maintain the integrity, safety and efficiency of the project that will bring BART service into downtown San Jose and Santa Clara.

KSTJV has been completing preconstruction work in preparation for the tunnel portion of the 10km extension, which includes an 8km single-bore tunnel – the first of its kind for a US transit system. While the change of tunnel contractors will impact the start of tunnelling, VTA staff are making efforts to maintain the overall project timeline, as the rescheduling of construction package rebidding may be balanced by design enhancements and more efficient construction methods.  

“As stewards of this region’s future, it is our responsibility to make decisions that ensure the success of this historic investment in public transit,” said Tom Maguire, VTA chief megaprojects delivery officer. “This course correction reflects strong, proactive leadership and reinforces our commitment to delivering BART Silicon Valley Phase II in a fiscally responsible manner.”

In the coming months, VTA will initiate a competitive procurement process. It said preliminary industry outreach with major tunnelling contractors worldwide showed great interest in the project and suggested that breaking down the scope that was allocated to KSTJV into multiple contract packages would better align with price estimates. This approach also supports the long-term viability of the programme.

KSTJV will complete the early BSVII construction activities it has started, which include building the launch structure for the TBM.

The VTA board’s decision came in the same week it was awarded US$100m in state funding for BART Silicon Valley Phase II (BSVII).

The grants, approved by the California Transportation Commission (CTC), are a significant contribution to filling VTA’s remaining funding gap for the project.

The funding includes:

  • US$25m from the 2025 Local Partnership Competitive Program (LPP), which supports infrastructure projects that address mobility and transport challenges through strong local investment. VTA submitted this application directly.
  • US$75m from the 2025 Solutions for Congested Corridors Program (SCCP), a competitive grant nominated by the Metropolitan Transportation Commission (MTC) with VTA as the implementing agency. This programme focuses on projects that relieve congestion and promote sustainable, equitable transportation solutions.

“These grants are a critical milestone in delivering BART Silicon Valley Phase II,” said VTA general manager/CEO Carolyn Gonot. “This investment reflects our region’s long-standing commitment to sustainable transit and the collective determination to bring BART farther into the heart of Silicon Valley. We are also working to set the standard for efficiency and fiscal responsibility in the transit industry by ensuring every taxpayer dollar is spent wisely and strategically.”

The BSVII project will extend BART service 10km into downtown San Jose and Santa Clara. The estimated US$12.7bn project is being funded through a combination of local, state, and federal sources, including a planned nearly US$5.1bn contribution from the Federal Transit Administration’s New Starts programme.

In response to evolving funding challenges, VTA has identified US$400m in cost savings and continues pursuing additional efficiencies to close a funding gap of US$700m to US$1.2billion.

On June 27 the VTA board was due to approve a change of tunnelling contractor for the project. Kiewit Shea Traylor JV was awarded the design-build contract for the tunnel and trackwork in 2022 but has failed to contain costs.