Who Has Final Say Over
World Trade Center Site?

NEW YORK -- Architects, city planners and pundits already have begun to weigh in on what they think should be rebuilt on the site of the World Trade Center, with suggestions ranging from parks to a new headquarters for the New York Stock Exchange.

But, before any plan can be pursued, a critical question must be resolved: Who has the legal power to say what will go there?

The answer is complicated by the 99-year lease, signed less than two months before the terrorist attacks, between the World Trade Center's owner -- the Port Authority of New York and New Jersey -- and a private group led by New York developer Larry Silverstein and Westfield America Inc., a shopping mall owner that is part of Australia's Westfield Group.

Charles Gargano, the Port Authority's vice chairman, said the agency's board has asked its legal staff for an opinion "as to who has the right to build." He noted that the issue is "complicated" and that "there may be different ideas how the World Trade Center should be designed and configured." As the agency that built the complex some 30 years ago, the Port Authority "would want to play a role in that," he added.

Howard Rubenstein, a spokesman for Mr. Silverstein, said the lease gives Mr. Silverstein a clear "right and obligation" to rebuild. But he stopped short of saying that Mr. Silverstein has sole discretion in deciding what to build there.

Mr. Rubenstein said the lease contains language that requires that any rebuilding be "appropriate" in terms what used to be there and "what has happened."

Mr. Silverstein "is not dictating, nor is he confrontational," Mr. Rubenstein said. "There will be a lot of people to help determine what appropriateness is."

People involved in the process, however, say the Port Authority and Mr. Silverstein are being motivated by different pressures.

To collect on his rebuilding insurance, valued at $3.5 billion per incident, Mr. Silverstein must show he is moving ahead with plans. "They want to demonstrate to the insurance companies that they want to rebuild," said one person involved in the rebuilding discussions.

Mr. Silverstein has been one of the most vocal proponents of moving forward quickly with a rebuilding program. He already has suggested that the complex be replaced with four, 50-to-60-story towers. Mr. Rubenstein declined to comment on the insurance issue.

But, as a public agency, the Port Authority is under pressure to move slowly in deciding how to rebuild. Numerous elected officials and others have called for creating a commission that ensures that whatever replaces the World Trade Center is a proper symbol of the magnitude of the tragedy, the nation's resolve to stay strong and New York's need to revive its financial district.

Under the lease agreement, Mr. Silverstein's group must pay more than $100 million a year in rent and he will probably play a lead role in deciding what to rebuild as long as he doesn't default, according to people who have read the lease. Mr. Silverstein has indicated that he intends to keep making lease payments as well as debt service on the $563 million in bonds he sold to finance his acquisition of the 99-year lease.

Another possibility, some say, would be for the federal government to step in and simply buy out the bond holders and the Silverstein group, which put in more than $125 million of equity in the deal. Mr. Rubenstein said that Mr. Silverstein, would be open to such an offer. "If the president of the United States called the governor and Mr. Silverstein and the Port Authority with that suggestion, they would all have to sit down and talk about it," he said.

Mr. Silverstein also owned 7 World Trade Center, a 47-story tower on land leased from the Port Authority that was destroyed by the collapse of the Trade Center's Twin Towers.

Mr. Rubenstein said Mr. Silverstein will be able to move faster in rebuilding a tower of about the same size on the 7 WTC site. The developer will have the necessary funds from insurance proceeds and that site will be easier to clear because the building wasn't as big and there were no fatalities when it crumbled, he noted, adding: "They could get that building up in a couple of years."

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