The Seattle City Council voted on Monday to appropriate $12 million to the Spokane Street Viaduct improvement project, but a gap in financing still remains.

Construction could start this summer and would widen the Spokane Street Viaduct east of Highway 99 from two lanes to three in each direction and build a new eastbound exit to Fourth Avenue. New on and off ramps to First Avenue toward downtown is also part of the capital project.

A total of $40.3 million is slated for the project in the city's 2008 budget, but the total cost is $168 million.

Fixing up that corridor is a high priority because it's needed to allow easier access to and from West Seattle to Interstate 5, and allow bus service between West Seattle and downtown when the Alaskan Way Viaduct is closed, which is expected in 2012.

Another $14 million will go toward long-awaited improvements to the Mercer Corridor, but the project has a hefty price tag of more than $192 million. Now, just $22 million is secured.

The controversial plan is to convert Mercer into a two-way boulevard west of Dexter Avenue North one block west of Aurora, and convert Valley Street into a smaller two-lane road with a turn lane, adjacent to the new Lake Union Park.

The $365 million Bridging the Gap transportation levy, which voters approved in 2006 to pay for a growing backlog of road maintenance, is complemented by a commercial parking tax and an employee hours tax that are expected to generate an additional $179 million over the nine years.

Some of that money was to go toward four major capital improvement projects: Spokane Street Viaduct, Lander Street Overpass, Mercer Street Corridor and King Street Station.

To fill in the remaining funding gap for these projects, Proposition 1, a three-county, $17.8 billion, (the largest local transportation tax measure in state history) was proposed last fall, but failed. It would have provided another $323 million.

With that funding source no longer an option and construction inflation rising by about 10 percent each year, the council eliminated the Lander Street project to move ahead with higher priority improvements.

Transportation Committee Chair Jan Drago added an amendment to the legislation that would not provide any further funds past 2008 for Mercer unless the funding gap can be closed. If the money can't be found, through city, state or federal sources, remaining Mercer money could be reallocated to help fund Spokane, which is the city's highest priority, said Drago.

Council member Nick Licata, whose amendment to allocate the Mercer funds to Spokane Street failed the week previous, said Mercer is too expensive and he sees little transportation benefit.

"Spokane Street, I think, is critical to the city," said Licata. "I don't believe Mercer is needed. It's a complicated package. The problem with the Mercer Corridor is an element of risk."

The Mercer area has been congested for more than 50 years, said Licata, and several proposals have come and gone for alleviating the problem of traffic backups occurring there.

It's been speculated that billionaire Paul Allen, the biggest landowner on that route, has influenced the idea because it could be financially beneficial. But, moreover, Licata said fixing the "Mercer Mess" has "become the Holy Grail for a successive string of mayors," including major backer of the project Mayor Greg Nickels.

"Whoever can solve it will be remembered as a doer and politician worthy of note for future generations," Licata wrote in his newsletter.

"This project siphons off tens of millions of public dollars from more worthy projects that would serve residents and businesses that live and work throughout the city and not just in South Lake Union."

Grace Crunican, director of the transportation department, said the improvements would result in a 15 percent to 25 percent relief from traffic on Interstate-5. It's also being touted as a way of managing traffic flow during Alaskan Way Viaduct construction.

Council President Richard Conlin added an amendment that states the city's intention to extend the two-way Mercer Corridor from Dexter west to Elliott and 15th Avenue Northwest in Ballard, to ease freight traffic flow to and from Ballard, Interbay and the freeways.

While he recognized Spokane as the most important capital project on the table, he said it was time the city move ahead with Mercer.

"I think this is actually a very well balanced piece of legislation in relation to the two projects," Conlin said.

Watch archived meetings of the full council and transportation committee at http://www.seattle.gov/council/archived_meetings.htm.

Rebekah Schilperoort can be reached at 783-1244 or rebekahs@robinsonnews.com