The state Legislature on Tuesday denied Seattle $75 million in federal aid it was counting on for the Mercer and Spokane street projects...

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OLYMPIA — The state Legislature on Tuesday denied Seattle $75 million in federal aid it was counting on for the Mercer and Spokane street projects. The city now wants the governor to find a way to get the money.

Seattle officials said they were dismayed when state House and Senate leaders released a list showing where federal stimulus money would be spent — and Seattle’s projects were missing.

Just last month, Gov. Chris Gregoire signed a letter saying she would support federal aid “for portions of the Mercer and Spokane Street projects.” The agreement, spelling out a plan to replace the Alaskan Way Viaduct with a tunnel, was signed by Gregoire, Seattle Mayor Greg Nickels and King County Executive Ron Sims.

But legislative leaders said Tuesday that Seattle wasn’t promised anything in the letter. “It says (Gregoire) will support it,” said House Transportation Chairwoman Judy Clibborn, D-Mercer Island. “There are no promises in that letter of agreement.”

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Clibborn and Senate Transportation Chairwoman Mary Margaret Haugen, D-Camano Island, said they weren’t picking on Seattle. No local projects were on the list, they said.

Nickels said the push for Seattle’s projects isn’t over: “My agreement was with the governor, and I expect that the governor will be sticking by these projects, and working with the legislators to open up the process.”

The governor’s office said Gregoire disagreed with the decision to omit the two Seattle projects. In a statement, Gregoire said she would continue to try to find money for the Seattle projects. At this point, the dispute doesn’t appear serious enough to derail the $4.25 billion tunnel project, which includes $3.1 billion for a four-lane, deep-bore tunnel under First Avenue and an elevated segment through Sodo. Clibborn and Gregoire stressed the tunnel proposal is still on track.

“Despite the lack of designated funding for these two projects, the bored tunnel remains the best viaduct replacement option and the project list released today does not impede progress on this option,” Gregoire said in a statement.

However, this is the second time state lawmakers have backed away from a key piece of the agreement. The letter urged the state to pass legislation allowing King County to approve a 1 percent motor-vehicle excise tax to beef up public transit in the region.

But lawmakers said there was little support in the Legislature for the proposal and the governor has backed off as well. It’s anybody’s guess how the tunnel project will fare in the weeks ahead.

A bill directing the state to replace the viaduct with a tunnel is moving through the state Senate. Assuming it reaches the House, the measure will face House Speaker Frank Chopp, D-Seattle, who is deeply skeptical about digging a tunnel because of the expense.

Washington expects to receive $492 million in federal aid for highways. Of that, $151 million goes to local governments and $341 million will be appropriated by the state. The list released by the Legislature on Tuesday detailed how the state would spend its share.

Legislators said all the money in Tuesday’s list would go to state-maintained roads and more than 40 percent to preservation projects such as repaving roads and filling potholes.

“The roof has been in disrepair, and we’re going to go out and fix the roof,” Haugen said.

Seattle wants $50 million in federal aid to help pay for the $200 million Mercer Street project, which would rebuild the bumpy eastbound road as a two-way boulevard with six lanes, trees and sidewalks.

The city’s main goal is to serve the South Lake Union neighborhood, where employers such as the Gates Foundation and UW Medicine are expanding.

Opponents, including City Councilmember Nick Licata, have argued that the project would not improve traffic flow near Interstate 5, and some see the project as a city giveaway to billionaire Paul Allen’s Vulcan Inc., the largest landowner in South Lake Union.

The city wants an additional $25 million in federal money for the Spokane Street project, which would add safety shoulders to the narrow elevated road, and a Sodo offramp with one general lane and one transit lane. Seattle still could receive stimulus money out of funds controlled by the Puget Sound Regional Council.

The Legislature’s snub came one day after the Seattle City Council voted 6-3 to release city money for Mercer, with hopes that would persuade Olympia to approve the federal aid.

But Nickels already was hearing from state lawmakers last week that they saw stimulus cash as “state money” and planned to spend it on state highways, the mayor said Tuesday. The same thing is happening in state after state, he said.

Given that background, Licata said, maybe the council should reimpose the spending freeze on Mercer. It’s the mayor’s “modus operandi” to rush the council, to avoid scrutiny of the project, he said. Nickels spokesman Alex Fryer replied that Mercer has been debated for years and is 100 percent designed.

Andrew Garber: 360-236-8268 or Mike Lindblom reported from Seattle.

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