Dallas adds $5.6m to drainage tunnel oversight as completion slips to 2029
City of Dallas Department of Water Utilities, Texas · Meeting date: October 14, 2026 · Published: October 15, 2026
Dallas City Council approved a $5.555 million supplemental agreement with Black & Veatch for construction management of the Mill Creek/Peaks Branch/State-Thomas Drainage Relief Tunnel. The project is reported to be 88% complete, but city staff now expect completion in early 2029, compared with an original March 2023 target.
Key points
- Council approved Supplemental Agreement No. 3, lifting Black & Veatch’s construction-management contract from $32.301 million to $37.856 million.
- The overall project had a $323 million budget; city staff said costs would be $289 million to date if the supplemental agreement were completed.
- The construction contract rose from $206 million to $212.6 million through prior action, while the tunnel contractor faces estimated liquidated damages of $19.5 million to date.
- The tunnel excavation was completed in 2022, but lining work remains only about 64% complete; surface drainage connections will follow tunnel completion.
- Staff said the project is designed to protect 2,200 commercial and residential properties.
Full report
Dallas City Council has authorised a further $5.555 million for Black & Veatch to continue construction-management services on the Mill Creek/Peaks Branch/State-Thomas Drainage Relief Tunnel, while acknowledging that the major stormwater scheme is now expected to finish in early 2029.
The October 14 approval increases Black & Veatch’s professional-services contract from $32.301 million to $37.856 million. The work is financed from the city’s 2006 General Obligation Bond-funded Flood Protection and Storm Drainage Facilities Fund.
City staff told council that the overall project is 88% complete. However, the original March 2023 completion date was first extended to January 2024 and the contractor’s current schedule points to July 2028. Dallas Water Utilities’ project delivery team is using an early-2029 completion estimate.
The overall project budget was set at $323 million, while staff put total costs at $289 million to date if the new Black & Veatch agreement is executed. The construction-services contract began at $206 million and has increased to $212.6 million through prior action. Staff said the additional construction-management cost reflects the project’s extended duration rather than an increase in Black & Veatch’s scope.
Delays have included late delivery of the tunnel boring machine, Covid-era and supply-chain disruption, permitting changes affecting concrete production, equipment breakdowns, repairs, and slower-than-anticipated excavation and concrete-lining production rates, staff said. The project was procured as a low-bid contract using calendar-day milestones.
Dallas is accruing liquidated damages against the contractor at an estimated $19.5 million to date. Staff said the amount could reach about $38 million under the contractor schedule, while the total additional construction-management services through completion are estimated at about $18 million-$19 million. Contractor claims relating to escalation and Covid impacts remain pending, according to staff.
While the tunnel excavation was completed in 2022, tunnel lining remains the key unfinished element. Staff said the lining is about 64% complete and is expected to finish by the end of 2027. The city must then connect surface-level drainage infrastructure into the tunnel, work that cannot be completed until the tunnel is ready to receive floodwater.
Council members pressed staff on the gap between the high reported completion percentage and the remaining schedule. Staff characterised the scheme as a significant deep storm-drainage tunnel project, saying such infrastructure will become more common as urban areas require drainage capacity below ground. The project is intended to provide protection to 2,200 commercial and residential properties.
This summary was generated by AI based on the source document and may contain errors.
Source: City Council, City of Dallas Department of Water Utilities