METRO RAIL FUNDING APPROVED : $200 MILLION LINKED TO SUBWAY PROJECT IN VALLEY.

Byline: Rick Orlov Daily News Staff Writer

The Los Angeles City Council voted Tuesday to contribute $200 million toward the $2.8 billion Metro Rail project, but on the condition that the MTA make the east-west San Fernando Valley leg its next priority and that construction occur along Burbank and Chandler boulevards.

The subway now is planned to be built from downtown to North Hollywood. Extension of the subway west to Woodland Hills has been threatened by rival proposals, including ones to build the subway along Crenshaw Boulevard in South Central Los Angeles.

``It's important for us to recognize the need to have transit moving in an east-west direction in the San Fernando Valley,'' said Councilman Mike Feuer.

After more than an hour debate, the council voted 12-2 to contribute the $200 million from its share of county transit tax revenues toward Metro Rail construction, with council members Nate Holden and Rita Walters dissenting.

``This vote of support is a critical milestone,'' said Joseph Drew, chief executive of the Metropolitan Transportation Authority. ``It sends an important signal to Sacramento and Washington that we can meet our commitment to build a complete transportation system in the region.''

MTA board Chairman Larry Zarian said the board would review the conditions imposed by the council, but believed they would be accepted.

``The City Council action today shows pivotal support,'' Zarian said. ``It means we can move forward.''

Mayor Richard Riordan, who supports the Burbank-Chandler route, said he was pleased with the council action.

``It's a step in the right direction,'' Riordan said. ``We owe the money and negotiated that we shouldn't have to pay any interest.''

The issue of where the Valley east-west line should go has been in contention for years. Supervisor Michael D. Antonovich, who also sits on the MTA board, has long favored construction of an elevated line along the Ventura Freeway, while the MTA board and most Valley political leaders support the Burbank-Chandler route.

Antonovich said he remains committed to the Ventura Freeway alignment.

``We can vote on Valley rail at another time,'' Antonovich said. ``What this is doing (is) burdening taxpayers and disrupting our neighborhoods. The city is reneging on its promise to pay the $90 million in cost overruns for Hollywood Boulevard and costing the other cities and unincorporated areas . . . their fair share of transit programs.''

Councilman Nate Holden also cited the project's troubled history in voting to oppose funding the subway. He threatened to take his case to Washington and argue before Congress that additional federal funds should not be spent on the program.

``You may have won here, but the battle isn't over,'' Holden said.

Councilman Richard Alatorre countered the city was following through on a commitment it had made years ago to provide 6 percent of the costs of the project.

``If we don't do this, we are jeopardizing funds for future programs,'' Alatorre said. ``If we cannot demonstrate that we will live up to our commitments, other (federal) funding will be jeopardized. I'm concerned about the whole city.''

As part of the deal approved Tuesday, the MTA will write off $90 million the city had agreed to pay for cost overruns on the project.

In a related development, MTA officials said Tuesday that they had freed a tunneling machine that had been stuck under the Santa Monica Mountains but that it would be several days before boring resumed.