East Link light-rail will run down Bellevue Way and 112th Avenue into a downtown tunnel, the Sound Transit Board of Directors decided last week.

But all is not solved.

The board identified a number of unresolved issues, and the fears of financial difficulties with the projects caused two members to vote no on the downtown tunnel alignment.

Seattle Mayor Mike McGinn and King County Councilmember Larry Phillips were the two dissenting votes. They worried about the lack of stable data. McGinn wanted to know where money to offset a potential shortfall of $100 to $200 million for the route – even after Bellevue’s half of the $276 to $300 million downtown tunnel – would come from.

“Parts of the voter-approved plan have been deferred,” he said. “And now we’re being asked to expand the scope beyond what the voters approved without a clear financing path.”

In addition to the gap, Sound Transit Chief Financial Officer Brian McCartan said tax revenue will likely be down again, though by less than one percent. McCartan was confident that the project could still be completed.

If financing falls apart, the board still has the ability to go back and make changes. But McGinn, and Tacoma City Councilmember Jake Fey were weary of promising a project they weren’t sure they could afford.

The issue of extra costs for the tunnel, which has shaped a pricey battle in Seattle, has also become a key talking point. The board added an amendment to a potential term-sheet for the tunnel that both Sound Transit and Bellevue would share extra costs. Bellevue’s contribution is capped at $160 million, and Sound Transit would be responsible for the remainder.

It remains unclear how the Bellevue City Council will react to this new demand. Councilmembers didn’t discuss the issue during their first look at the term sheet Monday. Councilmember Claudia Balducci, who also serves on Sound Transit’s board, voted in favor of the motion and said she fully supports the plan.

“It puts Bellevue and Sound Transit on the same team in trying to save money,” she said.

Jennifer Robertson, who represented Bellevue during public testimony, said there is still a lot left to be negotiated when asked about cost overruns.

Despite the present concerns, the decision represents a win for many who have spent several years at open houses, council meetings and other venues on the issue. Both Bellevue councilmembers at the meeting were excited to see a downtown tunnel route passed by Sound Transit.

The two groups will now continue negotiations for the specifics of the downtown tunnel.

As Sound Transit’s deadline loomed closer, Bellevue began to open up to Sound Transit through negotiations between councilmembers Kevin Wallace and Grant Degginger, city officials, and Sound Transit officials. It was behind these closed doors that some of the tensions cooled.

Bellevue became more open to the idea of the Bellevue Way/112th route. While still maintaining their position in favor of the route running along the BNSF rail corridor (B7), Bellevue councilmembers began to speak more about the need for “exceptional mitigation” to Sound Transit’s route, rather than the potential superiority of their preference.

The two bodies were supposed to have an agreed upon term sheet, which paves the way for more concrete negotiations, by Aug. 3, but the board extended the date by a week.

“We’re going to need every one of those days,” Balducci said.

After that, Bellevue and Sound Transit will have until Oct. 25 to negotiate a binding term sheet for final board approval later that week.

Following federal approval, Sound Transit will go into final design. Construction is slated to begin in 2015. The line will be open by 2022 or 2023.

The Thursday decision represented years of plans, public outreach and political battles over extension of light-rail to the Eastside.

The passion of the issue was illustrated yet again as audience members presented more than an hour of public testimony. They mostly urged Sound Transit to act during the meeting and opt for the tunnel route. Others pushed for a westside running alignment on 112th Avenue that they say would be cheaper, and less disruptive.

Many of the speakers were glad to see the heat come off Bellevue and Sound Transit’s relationship as a decision deadline came closer. This change gave many of the board members the faith to vote on the tunnel alignment when no firm agreement had been reached.

“It has not always been collaborative,” said Issaquah City Councilmember Fred Butler, “but I’m delighted with what has happened recently, and the new spirit of cooperation is evident to me.”