Austin is getting closer to raising the money it needs to put I-35 in a partial tunnel after Texas lowers the main lanes 30 to 40 feet from Holly Street to Airport Boulevard. The city just raked in a $105 million grant from the U.S Department of Transportation, and the council could vote next week to borrow $193 million more from a state infrastructure bank.
The Texas Department of Transportation is planning to sink the lanes as part of a decade-long construction project that includes tearing down the upper decks and adding four high-occupancy vehicle lanes along an 8-mile stretch from Ben White Boulevard to U.S. 290 East.
TxDOT won't pay to cover the lowered lanes, but will install so-called caps over the trenched highway if the City of Austin and University of Texas foot the bill. The city could also add mini-caps, so-called stitches, that stick out of bridges to create more public space.

Austin is considering spending $881 million or more on a menu of caps and stitches that would create slightly more than 27 acres of space. Caps would cover the highway from Cesar Chavez to Seventh Street, from 11th to 12th and from 38 1/2 Street to Airport Boulevard. Stitches would be installed at Holly Street, 32nd Street and 51st Street.

Annual operations and maintenance would cost up to $35 million, according to a staff estimate. Caps require large and costly ventilation and fire suppression systems. For comparison, Austin spends almost $40 million per year on municipal courts.
Meanwhile, the city wants to borrow up to $193 million from a special loan fund managed by TxDOT. The State Infrastructure Bank provides low-interest loans for transportation projects. The City Council is scheduled to vote on whether to apply for the loan at a March 21 meeting.
Even with the TxDOT loan, the city would still be hundreds of millions of dollars short from being able to pay for caps and various amenities on top. Some caps could be constructed to support buildings. Other ideas for amenities have included parks or elevated walkways.

Other options under consideration to pay for construction include selling naming rights to a cap or a stitch. A bond election, asking voters to fund the caps with property tax revenue, is also on the table.
Austin already paid TxDOT $15 million late last year to start designing the caps and stitches. Another $19 million is due by December to finish the blueprints. The city could have to start paying for construction of the caps as soon as 2026.