I can't claim to have experience in this type of administrative process, but I would expect that the permit process would proceed full speed ahead unless/until there is an agreed joint application between the state and the tribes. It's crazy to do it otherwise in such a time-sensitive case (then again, I think WDFW should have been ready to file an independent permit application the moment talks broke down). Certainly in a litigation context (not quite the same thing, I know) it is normal to proceed with the adversarial proceeding while still trying to reach a settlement.

I believe WDFW submitted its permit application May 6 (I think that's what I read).