WTC site rebuilding talks break off

The Port Authority of New York and New Jersey owns the site where the Twin Towers were attacked and destroyed on September 11, 2001. Real estate developer Larry Silverstein of Silverstein Properties holds a 99-year lease that was signed two months before the attacks.

New York Gov. George Pataki set a March 14 deadline for the two parties to reach an agreement on how to expedite the rebuilding.

Bud Perrone, a spokesman for Silverstein, said the Port Authority made the move to suspend the talks, which had continued after a midnight deadline.

"This temporary setback can and must be overcome," Perrone said in a statement, adding Silverstein was ready to resume talks. "We believe we can quickly finalize an agreement that will assure a speedy rebuilding of the World Trade Center."

Representatives from the Port Authority and Pataki's office could not immediately be reached for comment. Perrone would not comment on what differences remained or what steps the parties may take going forward.

A deal is crucial to Silverstein obtaining low-cost financing, in the form of Liberty Bonds, which he needs to rebuild. Silverstein has asked for $3.4 billion in the tax-exempt bonds, half from the state and half from the city.

Pataki had pledged to release the state's half pending a Silverstein agreement with the Port Authority.

Silverstein has been at odds with Port Authority and the city on the $7.3 billion project to build four office buildings including a centerpiece Freedom Tower, which at 1,776 feet (541 meters) would be among the tallest buildings in the world.

The New York Times reported that the two sides were discussing a proposal for the Port Authority to take over construction of the estimated $2.3 billion Freedom Tower. But the two sides were at odds over how to pay for the project.