In 2005, in the wake of Katrina, the earmark in Don Young's transportation bill for the Bridge to Gravina Island came under additional scrutiny.  It was the US Congress that stripped the earmark, but agreed to give Alaska the money for other transportation projects.

There would be no way for Gov. Palin to reject the earmark or the money in 2005, because she wasn't governor, in fact, she wasn't even running for governor yet.

In 2006,  Ketchikan was continuing to lobby for its bridge through State transportation funds. Palin, who was then running for Gov. at least gave lip service to funding the bridge.

The state continues to spend money on different feasibility options for Gravina Island access. To my knowledge the bridge has never been formally rejected as an option; it's only that less expensive alternatives are receiving more attention.