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look at map
If you look at the map from the Streetcar System Project you will see that Barbur Blvd is slated for High Capacity Transit which is the reason that it is not being considered for streetcar. There are a few lines to be considered for future streetcar including SW Bertha, Capital Hwy. SW has not been ignored but Streetcar might not be the best transit option for all areas of SW.
There is no funding option that has been mentioned so far but often streetcar is funded by a Local Improvement District (LID) which means you wouldn't fund streetcar on the east side.
Check out the website at http://www.portlandonline.com/transportation/index.cfm?c=45755