She has directed further work on the Alaskan Way Viaduct project as well as a vote on whether it should be replaced by a tunnel or elevated structure. Gregoire said that the finance plan in the draft environmental impact statement for an elevated structure is "feasible and sufficient" to complete the project, unlike the plans for a tunnel. There is however a political stalemate, with opponents to each alternative. She proposes a vote to select either the tunnel or the elevated structure and has directed Washington State Department of Transportation to continue work on both alternatives, with a view to starting construction on schedule in 2008.

Gregoire concluded that the work on the SR 520 corridor is a matter of urgency for the safety of the travelling public and the needs of the regional transportation system but that the finance plan as described in the environmental impact statement is not "feasible and sufficient" to complete the project. The replacement bridge should be a structure with four general and two HOV lanes, she said. Work must continue on the funding, design, mitigation and the environmental impact statement.