A plan by Elon Musk’s Boring Company to build a tunnel between San Antonio’s airport and downtown was selected Wednesday by the local regional mobility authority for a feasibility study.

Board members serving the Alamo Regional Mobility Authority (RMA), an agency tasked with improving transportation in Bexar County chose Boring over a bid from a local consortium, SAK/Bexar Automated Transport, to enter into a development agreement to study the feasibility of the project. 

County staff used a scoring system with eight criteria to evaluate the two bids. The estimated project cost and potential revenue were at the top of the scoring matrix.

As proposed by Boring, the rideshare system would use Tesla’s electric-powered cars traveling in a tunnel 30 feet below ground to ferry passengers the 9 miles between the airport and downtown. The total estimated cost is between $247 million and $289 million.

Boring’s bid includes an option for the company to fully finance phase one of the system, a tunnel between the airport and the Pearl to start, at a cost of $27 million to $45 million.

Boring estimated revenues to the RMA of $25 million a year.

“What we don’t know is whether it’s financially viable at this point because, at the end of the day, the reason we’re doing this is to generate a revenue stream for the RMA, so that we can build even more infrastructure projects,” Michael Lynd, the RMA board’s presiding officer who recently was reappointed by Gov. Greg Abbott.

A representative from Boring who attended the meeting declined to comment on the decision.

Founded by automotive entrepreneur Elon Musk, the Boring Company’s stated mission is to “create safe, fast-to-dig, and low-cost transportation, utility, and freight tunnels.” Its only project completed to date is the Las Vegas Loop, a 1.7-mile system that circles the city’s convention center.

The location of an underground tunnel system is still up in the air, pending feasibility studies. But the RMA is looking for the project to make money it can then use to build other needed transportation systems. 

The Alamo RMA was established in 2003 to manage toll roads. But with no toll roads in the county, its role was broadened to accelerate needed transportation projects. 

Without toll revenue, the authority’s primary source of funding to build those new roads and transportation systems comes from vehicle registration fees, which can be used only for already-identified projects.

“The [request for information] was issued on our behalf after a lot of conversation to try to get creative and come up with a source of revenue for the RMA that could be generated, that has longevity to it, that we can then use to be able to finance infrastructure projects and other demands,” said Lynd. “Right now we’re dependent, really, on the state for all of our needs beyond what we get from the registration fee.”

Renee Green speaks to her fellow Alamo Regional Mobility Authority board members about the proposal from Elon Musk’s Boring Company to build a tunnel between the airport and downtown Wednesday.
Renee Green speaks to her fellow Alamo Regional Mobility Authority board members about the proposal from Elon Musk’s Boring Company to build a tunnel between the airport and downtown Wednesday. Credit: Bria Woods / San Antonio Report

To pay for the tunnel project, the RMA would issue revenue bonds that would be backed solely by the project’s revenue, Lynd said. That could come from ride fares and advertising throughout the system.

Entering into the development agreement is the first step toward determining where and how the tunnel system would be built and whether it would pay for itself. 

No timeline has been set for the process to determine the project’s feasibility. The RMA will hire an investment advisor to study the project and determine more precise revenue streams, which will be needed in order to sell bonds that would finance the project. 

“This is not your only bite at the apple as we go forward with this,” said Renee Green, director of public works and county engineer. “We’ll be coming back obviously to the board over a number of different things.”

The board’s unanimous approval of Boring’s bid gives the RMA the green light to pursue answers to questions about the system Boring proposed and its viability. It’s not an OK to build the system. 

“I don’t even think we’re biting at the apple, we’re pointing at the apple,” said board member John Agather.

“This is approval to take the next step to enter into conversations and discussions about where we go from here — whether this is financially viable, et cetera,” Lynd said. “There’s still a lot of vetting to happen and locating of the lines.”

City staff recommended Boring for the project based on the estimated cost, which was more than $30 million less than the SAK/Bexar bid, and projected revenues, about $22 million more than what SAK/Bexar projected. 

Boring intends to submit all the necessary permits to build a transportation system and has previous experience working with the Federal Aviation Administration through its Las Vegas Loop project. 

The company also stated it could begin work on the project within a year and complete it in 36 months. Boring would operate the system and provide maintenance.

A representative from Boring who attended the meeting declined to comment on the decision.

Lynd called the project a “proof of concept” that could determine whether the tunnel system is expanded to connect San Antonio to other cities. 

“I’m sure there is ambition to connect Austin and San Antonio,” he said. “Everybody in San Antonio I think would love to see that happen. But something like that would be in the future.”

Shari Biediger

Shari Biediger is the development beat reporter for the San Antonio Report.