An independent review panel chastised and applauded the Washington State Department of Transportation for its plans for replacing the Alaskan Way Viaduct.

The panel determined there is enough money to build a basic tunnel or a basic new viaduct but warned officials they're being overly optimistic about construction costs and how much money to expect the federal government to contribute to rebuild not only the Alaskan Way Viaduct, but also the 520 Bridge and its connections to I-5 and I-405.

Afterward Governor Christine Gregoire called on state transportation planners to update their cost estimates in time for voters' consideration for a possible public vote on the waterfront project this fall.

The Expert Review Panel was appointed by the governor and the Legislature in June to review the status of plans to replace and pay for the Alaskan Way Viaduct and the 520 Bridge.

There is no "fatal flaw" in the planning of the viaduct project, said Jane Garvey, chairwoman of the Expert Review Panel. She is former administrator of both the Federal Aviation Administration as well as the Federal Highway Administration. She also is past director of Boston's Logan Airport and was commissioner of the Massachusetts Department of Public Works.

State officials have been estimating future costs based on an inflation rate of 2.4 percent. The expert panel said the future is too uncertain now so the construction industry currently is using an inflation rate of 6 to 10 percent to estimate costs, Garvey said.

Planners also are making overly rosy projections of federal funding the project might receive, the panel stated. State transportation planners have been estimating they can get $100 million in federal transportation reauthorizations, $60 million from federal emergency relief funding and $150 million from the U.S. Army Corps of Engineers.

As part of their assessment of the project, Expert Review Panel members traveled to Washington, D.C. to talk with congressional leaders and federal transportation officials about the availability of federal funds for the Alaskan Way Viaduct and the replacement of State Route 520.

"Generally there is some concern about the future of transportation funding," Garvey said. Increasingly members of Congress are "earmarking" federal money for specific projects rather than putting money into budgets to be divvied up by federal departments. That means politics play an even larger role in how federal money for transportation projects is dispersed.

There's also been a "diminishing" of the federal Highway Trust Fund, a traditional source of money for maintaining the interstate highway system, panelists said. Money to the fund has come from taxes on the sale of fuel, tires, motor oil, tractor-trailer sales as well as haulage fees.

Panelists also said state planners were too confident about how long it will take to replace the viaduct.

King, Pierce, Snohomish and Kitsap counties have discussed setting up a regional transportation investment district to take regional approaches to solving the region's transportation needs. However voters might not approve a regional approach - one proposal is an $800 million package of projects while another proposal recommends $1.4 billion worth of projects. There will be a lot of competition for any money approved by voters so there might not be as much available for the viaduct project as some believe, the panel concluded.

The panel suggested regional tolls could be another way to pay for big transportation projects in the central Puget Sound area. In states such as Texas, Florida and Virginia, government agencies have formed partnerships with private businesses to build highways and charge people to drive on them. But even those partnerships must rely on a "revenue stream" to make them work, Garvey said.

The panel thought a regional toll system could generate about $150 million a year.

The Washington Legislature also laid out responsibilities. The state is responsible for replacing the viaduct as it is. But if people want to expand the viaduct's traffic-carrying capacity, that would be up to the region to undertake, Garvey said.

The Expert Review Panel said there have been enough studies and analysis. Pick a plan and go for it, members said.

"You have enough information to decide by the end of the year," Garvey said. Final design could be completed by next July.

"Sometimes delay is the greatest risk," Garvey said.

Tim St. Clair can be reached at tstclair@robinsonnews.com or 932-0300.