Hogan said in a statement Friday that the state has submitted the application to the U.S. Transportation Department.
The Republican governor and CSX Transportation Chairman Michael Ward both say that enabling taller trains to pass through the 121-year-old tunnel will eliminate an East Coast railroad bottleneck.
Federal officials denied Maryland’s application for tunnel-improvement funds earlier this year.
The plan involves lowering the floor and notching the tunnel’s crown. Officials say they can make enough room in the tunnel and under nine bridges for $445 million.
CSX and the state have committed $270 million. Maryland is seeking federal funds for the rest.