The Santa Clara Valley Transportation Authority (VTA), Caltrans and local leaders marked on May 25, 2025, the groundbreaking of the long-anticipated U.S. 101/State Route 25 Interchange Upgrade Project — designed to ease congestion, improve safety and better connect South County residents to jobs, schools, and services.
DeSilva Gates Construction of Dublin, Calif., is the contractor.
"We are not just improving roads — we are creating lasting connections between the communities of Morgan Hill and Gilroy and our San Benito County neighbors — ensuring access to opportunity, future growth, and the success of our region," said Sergio Lopez, the mayor of Campbell and the VTA board chair.
The event took place in Gilroy, a short distance from where the construction is happening, featuring representatives from VTA, CalTrans and Santa Clara and San Benito counties.
The existing interchange just south of Gilroy in Santa Clara County is more than 30 years old. It cannot accommodate traffic demands due to the rapid growth in commuter, commercial and recreational traffic that passes through the area. These conditions and high travel speeds have resulted in higher-than-average accident rates in the interchange area and traffic backups onto southbound U.S. 101.
Project Components
Phase 1 will:
• Reconstruct the U.S. 101/SR 25 interchange slightly north of the current interchange.
• Replace the SR 25 two-lane overcrossing with a four-lane overcrossing spanning across U.S. 101.
• Increase the length of the southbound U.S. 101 off-ramp to SR 25 to decrease traffic backups onto U.S. 101.
• Upgrade the northbound U.S.101 ramps to improve exit and merging operations.
• Install new traffic signals at the ramp intersections to improve traffic flow.
• Construct a separated two-way bikeway between Castro Valley Road and the southbound U.S. 101/SR 25 intersection.
Project objectives include improving connectivity between U.S. 101 and SR 25; improving traffic operations along U.S. 101 and SR 25 with added ramp storage and signals; enhancing safety within the interchange area by reducing ramp backups onto southbound U.S. 101 and providing improved access for safer merges; and supporting the overall future interchange reconfiguration, including U.S. 101 and SR 25 widening, and future State Route 152 improvements between U.S. 101 and State Route 156.
As additional funding becomes available, future phases of interchange improvements will be scheduled. These future upgrades include converting the interchange to a partial cloverleaf or diamond ramp configuration with potential direct connectors, frontage roads for local and bicycle access, and grade separating SR 25 from the Union Pacific Railroad east of U.S. 101.
This $136 million project is funded through a combination of local sales tax measures, state transportation dollars and federal contributions. It's one of many projects on which VTA has partnered with the state transportation agency.
"This project represents a shared investment in the safety, operational improvements, mobility, and future of this region. With $59 million in SB 1 funds for construction capital and support from VTA's Measure B, we're building more than infrastructure — we're building long-term regional connections," said Dina El-Tawansy, Caltrans District 4 Bay Area director.
Senate Bill 1 (SB 1) has invested approximately $5 billion annually toward transportation projects since 2017. It provides funding split between the state and local agencies. Road projects progress through construction phases more quickly based on the availability of funds, including projects that are partially funded by SB 1.
For details, visit build.ca.gov and rebuildca.ca.gov.
