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Tunnels have allowed American cities to overcome challenges of topography, infrastructure, and transportation.

Transportation tunnels are the most prominent tunnels in cities, allowing vehicles to avoid river traffic or natural barriers. For example, tunnels opened in 1869 and 1871 allowed pedestrians and carriage drivers passage under the Chicago River, where heavy ship traffic required frequent opening of drawbridges.

Though their most prominent tunnels traversed mountain ranges, railroads built shorter tunnels to serve urban areas. Tunnels allowed railroads to pass through built-up parts of Baltimore and Seattle, an easier approach to San Francisco, and to serve suburbs northwest of Montreal. Objections to railroads through the city center were overcome by building tunnels south of Washington's Union Station, west from Philadelphia's Suburban Station, and on the 2-mile approach to Grand Central Terminal underneath Park Avenue in Manhattan. Underwater railroad tunnels connected Detroit with Windsor and linked Manhattan to New Jersey and Long Island.

At the turn of the 20th century, tunnels allowed the new electric streetcars to penetrate steep hills they could not easily climb. Tunnels in Providence, Pittsburgh, St. Paul, San Francisco, and Los Angeles allowed the development of new outlying residential areas. Chicago's river tunnels had been used in the 1880s for cable cars, whose continuous cables could not cross drawbridges, and were rebuilt for streetcars. As street traffic grew, short streetcar tunnels were built in a number of cities to avoid congestion. In Newark, Rochester, Philadelphia, and Boston, these included several stations and functioned like rapid transit lines. A number of the new light rail lines built since 1980 have included sections in tunnels, and Seattle opened a downtown tunnel for electric trolleybuses in 1990.

A streetcar tunnel in Boston, opened in 1897, was America's first subway. Reliable electric propulsion permitted rapid transit trains to run underground, and in 1904, a full rapid transit subway line opened in New York. Lines soon crisscrossed the city, including a dozen underwater crossings. Additional subway lines, using rapid transit equipment, opened in Boston. Philadelphia's first subway line opened in 1907, and Chicago began construction of two lines through the business district in 1938. A new wave of subway construction began in the 1950s with Toronto (opened 1954), Cleveland (1955), Montreal (1966), the San Francisco Bay Area (1972), Washington (1976), Atlanta (1979), Baltimore (1983), Vancouver (1986), and Los Angeles (1993). Most rapid transit systems use subway tunnels only through the most congested areas; Montreal has the only completely subterranean North American system.

An unusual system of tunnels was the freight tunnels built underneath Chicago's downtown streets between 1900 and 1909. Small electric trains connected office buildings and department stores with railroad freight terminals for delivery of packages and coal and the removal of ashes. The 62-mile network closed in 1959, but the tunnels are still used for utilities. A freak accident in 1992 flooded the tunnels and buildings still connected to them.

Rubber-tired vehicles have an easier time negotiating steep grades, but road tunnels are sometimes built through hills in urban areas, such as the hills surrounding Pittsburgh, Seattle, and Oakland, California. More numerous are the vehicular tunnels under busy waterways, such as those leading into Manhattan, under Boston Harbor, Hampton Roads, the Mobile River, and the Detroit River, and beneath both ends of the Chesapeake Bay. Tunnels are more expensive to build than bridges and need complicated ventilation systems but require less land for approaches in crowded cities.

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