Sorry, my answer on Steam was quite short/brief since it was late at night (my time) when I responded. The players who responded above are correct though.
Select the “Terrain” tab in the top-left.
Select the “Materials [2]” tab below it (alternatively: press [2]).
From the bottom-left, switch the mode to “Cut [R]” (alternatively: press [R]).
You now have the Cut brush selected, which is used to paint holes in the terrain. Click-and-drag your brush over the terrain you want to be a hole.
Currently you can’t make working tunnels placed between 2 landscape holes IF you use Underground_Whitelist true line in level.dat. (should be fixed!!!)
Iirc you can’t even move through it on foot or you can’t drive through it with vehicles.
Not using Underground Whitelist will cause many out of bounds glitches possible.