Your understanding is incorrect.

Read title 23, United States Code.  Federal aid highways are Federal decisions.  
The City vote of the citizens was advisory, it did not determine what the Feds did or did not do.  The City Council vote was merely to determine City policy, but the "No Build" decision was issued by the United States Department of Transportation, Federal Highway Administration, Oregon Division in  Salem.

Piercy, Kelley and other local officials played a role, but they did not cancel th e porkway.

THe pro-WEP local politicians never sought to appropriate any money for construction.

Mark Twain said if you don't read the paper you're uninformed and if you do read the paper you're misinformed.

www.peaktraffic.org/4f.html
details on the main law that stopped the WEP