Portland officials, eager to expand the city's heralded streetcar line across the Willamette River, are learning that federal transit managers favor buses for efficiency and may delay or withhold construction funding.

The expansion, pegged to cost $147 million, would extend the streetcar from the Pearl District across the Broadway Bridge and south to the Oregon Museum of Science and Industry, nearly completing a streetcar loop of the city's core. The federal government, according to the Portland City Council's plan, would pay for half.

But the City Council scrambled in early September to meet a deadline to apply for funds, only to learn from the Federal Transit Administration that Portland is failing to meet a cost-effectiveness test that planners here say is biased against streetcars in favor of high-capacity bus lines.

At stake is about $200 million in federal money that could provide the first national program for streetcars in cities across the nation. More than 60 cities nationwide have ideas for emulating the Portland Streetcar and the dense mix of housing and commercial development that accompanies its downtown route.

Despite the chance to compete for the new pot of money, however, every city except Portland has balked. Seattle, which just opened its first streetcar line earlier this month, says the process favors bus rapid transit --the type of line that has large vehicles traveling in their own lanes separated from car traffic.

Transit administration officials have said the Office of Management and Budget, a department in the White House, has ordered them to raise standards for cost effectiveness when judging transit projects. That contrasts with the bill Congress passed in 2005, saying projects should be funded if they support public transportation, are cost-effective and boost local economic development.