I would think poor ground strength makes cut-and-cover even more attractive relative to the alternative (drilling). For tunnels drilled under streets, the street is supported by rock/soil. For cut-and-cover, the street is supported by concrete and steel.

Maybe you're thinking that it's just impossible to have shallow tunnels at all with the type of soil? I don't think that's how things work, but I'd love to hear from an expert.

Basements are expensive to build and the climate in northern california doesn't require you to build below the frost line like it does in the north. So nobody does.

Code doesn’t require it, and basements add building costs.