Apparently an internal squabble among the “locals”...the city wasn’t trying to fill in the tunnel:
https://forward.com/fast-forward/575528/arrests-at-chabad-770-secret-tunnel/
The tunnel was opened in the other building under the women's section. I was horrified when they started pulling down the paneling in the synagogue. I like old stuff, ok?
Originally it was a medical office. There was probably a connection to the building next door and was later sealed up and covered with paneling. Bricks and cinder blocks are too straight. Cinder blocks must have been added later to close the connection.
Also, it probably was an alleyway between two buildings, not a tunnel.