The U.S. Army Corps of Engineers (USACE) Nashville District announced it has terminated its lock chamber contract with Shimmick Construction Co. Inc., Irvine, Calif., at the Chickamauga Lock Replacement Project in Chattanooga, Tenn., dealing a fresh setback to the long-delayed Tennessee River navigation upgrade.
The replacement project, which began in 2004, has a total cost approaching $1 billion — up from an original projection of less than $300 million, a more than threefold increase driven by congressional funding delays and problems with supplies, labor, and concrete expansion in the existing lock chamber.
USACE cited the contractor’s failure to prosecute work with diligence, maintain project schedule, progress critical work, correct quality deficiencies, and manage project controls as grounds for the termination. The agency said it had actively collaborated with Shimmick to improve execution and overall delivery of contractual obligations before pulling the contract.
“Despite these efforts, the contractor’s inability to meet contractual obligations resulted in the government’s loss of confidence in their ability to perform the work required by the contract,” USACE said in a statement.
Shimmick was the prime contractor to build the new 600'x110' lock chamber. The original contract was valued at approximately $240 million, but Shimmick had previously sought additional compensation and time, citing Covid-19 delays, material inflation, tight labor markets, and supply chain challenges.
The Corps, which terminated the contract effective May 8, framed the cancellation as a fiscally responsible decision, saying it was necessary to prevent cost impacts that would not produce a positive return on American strategic infrastructure investment. USACE said the action aligns with the Army Civil Works’ “Building Infrastructure, Not Paperwork” initiative and its emphasis on fiscal discipline.
Great Lakes and Ohio River Division Commander Col. Daniel Herlihy credited the Nashville District team for its oversight of the project. “Our team recognized the root causes of this contractor’s delays and took decisive action. By terminating this contract, our USACE professionals enforced the high standards of accountability and efficiency the nation expects,” he said.
USACE said it is now exploring all contracting options to complete the remaining lock chamber construction and maintain the overall project timeline. The agency said its goal remains delivering an operational navigation lock in 2028.
The termination of the Shimmick contract is not the project’s only active construction front. In February 2026, USACE awarded a separate $192 million contract to C.J. Mahan Construction Co., Urbancrest, Ohio, to construct downstream approach walls, breach the existing dam to connect the upstream approach to the new lock, and bring the new lock to operation by removing the cofferdam.
Failure to complete the project before the existing lock fails would close 318 miles of navigable river to commercial marine traffic. About 1 million tons of freight moves through the lock annually, and the new lock is projected to reduce commercial transit times by 80 percent.
The new lock will be 600' long and 110' wide, replacing the original structure — 360' long and 60' wide — that opened in 1940. When complete, it will handle nine barges per lockage, compared with just one in the existing lock, enabling freight to move faster through the river system.
