Volume 22, Number 12 | The Newspaper of Lower Manhattan | August 7 - 13, 2009


Agency report supports Silverstein in World Trade Center dispute

By Josh Rogers

A child who was born the day of the 9/11 attack has about a 50-50 chance of battling senioritis in high school before the time he or she will be able to ride a train in the multi-billion-dollar train station under construction at the World Trade Center. (article continues below image)

Photo shows work on the World Trade Center memorial, center, but a new analysis of the site’s construction predicts the memorial’s plaza will not be finished until 2013, two years later than the current schedule.

(continue) That was one of the conclusions (minus the hypothetical high school senior) reached in the latest analysis of the W.T.C. by the Lower Manhattan Construction Command Center, a post 9/11 agency formed in part to help speed up Lower Manhattan rebuilding.

Nearly one third of the command center’s $17.5 million annual budget ($5.19 million) comes from the Port Authority, yet its analysis backed key points Silverstein Properties has been making in its financial dispute with the Port — namely that authority delays are responsible for the construction risks preventing the firm from finishing the W.T.C. towers on time. Even Tower 4, the only W.T.C. office Silverstein is currently building, has a 50 percent chance of finishing over two years late, in 2015, according to the L.M.C.C.C. document.

The Daily News first reported on the confidential analysis on Tuesday, the same day a copy was provided to Downtown Express. Also this week, Silverstein filed for arbitration after Gov David Paterson made a new proposal that was very similar to the Port’s last offer to the firm.

As for the construction report, in addition to the prediction that the transit hub probably will not be done until 2018, the document also said:

• The W.T.C. memorial fountains will not be working by the ten-year anniversary of the attacks as had been promised, and that even by early in 2013, there is a 50-50 chance the fountains will not be working and the first stage of the memorial plaza will not be done.

• Tower 1 or the Freedom Tower, a Port project, is likely to be done two years late, in 2016.

The command center cites delays in building the complex maze of infrastructure equipment as the reasons for most of the delays. In the case of Silverstein’s Tower 4, the expected delays building Greenwich St., the site’s Vehicle Security Center, chilled water equipment, and a center on the site to coordinate construction activity, are the reasons the project is at risk for delays. All of these infrastructure projects are the Port’s responsibility, although the vehicle center is being held up by delays demolishing the nearby Deutsche Bank building, which is owned by the Lower Manhattan Development Corp.

The command center declined to comment on the report and the Port Authority in a prepared statement said: “The dates are wrong. Our comprehensive analysis, completed every month, shows we are on schedule to meet the completion dates we released last October.”

Silverstein has remained skeptical of the Port’s schedule because the agency has not released detailed construction goals and schedules beyond a few months. Mayor Bloomberg and Assembly Speaker Sheldon Silver, who have criticized the Port’s “intransigence” in its negotiations with developer Larry Silverstein, seized on the command center report this week.

“Last year, when the Port announced its new plan that would fix the problems at the site and lead to progress, it asked us all to hold it accountable,” Bloomberg said in a prepared statement Tuesday. “We are, and the results are intolerable.”

Bloomberg also said the command center should be released from its ties to the Port and the Lower Manhattan Development Corp. so it could take a stronger oversight role at the W.T.C. The agency was set up in 2005 and under its charter, the executive director is supposed to report directly to the governor and mayor, but as a practical matter it has not worked that way. The L.M.D.C.’s board oversees the command center and the two agencies share legal staff.

Silver, who over the last few months has agreed with the mayor on every aspect of the W.T.C. stalemate, disagreed with Bloomberg about the L.M.C.C.C. In a brief interview across the street from the site on Tuesday, Silver said he did not want to add to the bureaucracy by putting the construction center in charge when it isn’t hard to figure out what is wrong.

“You just go there and look at what’s going on,” Silver told Downtown Express. “Nothing has risen out of the ground.”

He and the mayor both warn that if the decisions are left to an arbitrator, it will add months, if not years to the project.

A rebuilding source familiar with Silverstein’s thinking said the firm will ask the arbitration panel for all $2.75 billion it has paid the Port in rent and insurance proceeds and may seek punitive damages as well. The developer also wants a detailed construction schedule and wants to suspend its rent obligations while the dispute is resolved.

Paterson, in a letter to Silverstein, did offer to suspend rent for Towers 2 and 3, where the governor and the Port want to delay construction until the Silverstein can get private financing. But the governor also asked Silverstein to use his remaining insurance proceeds to help build the public underground infrastructure instead of on the office towers he wants to build.

Paterson wrote: “Your proposal husbands a significant portion of insurance money for future office development that could be built many years from now… I cannot accept a proposal that does not put all insurance into the immediate construction of the site.”

Janno Lieber, president of Silverstein’s World Trade Center Properties, said: “These ideas also don’t address the principal issue – the Port’s chronic failures at the site. Every project for which the Port Authority is responsible has fallen years behind schedule and billions of dollars over budget, hindering the entire W.T.C. rebuilding effort.”

The Port maintains it has met just about all of its quarterly construction goals, but in its latest report Wednesday it did not mention that it had still not met its 2008 goal of turning the Tower 2 and 3 sites over to Silverstein.

Steve Coleman said it expects to be ready to finish the sites sometime next month, at which time it will be able to stop paying the $300,000 daily late fees to Silverstein.

As for the memorial, Coleman said not only do they plan to have the plaza open Sept. 11, 2011, they also will be ale to stage this year’s ceremony on part of the plaza.  

Joe Daniels, president of the National September 11 Memorial and Museum, said in a prepared statement that the Port has made good progress building the memorial in the last year and all of the parties including the mayor are committed to a 2011 opening, but “the L.M.C.C.C. report identifies serious risks of delay to infrastructure elements that surround the memorial and could, if unaddressed, affect our ability to open permanently after 9/11/11.” 

Bloomberg, who is also chairperson of the memorial organization, backed off his full-throttled support for the L.M.C.C.C. report Wednesday, saying he thinks the memorial plaza will be mostly done in 2011.

“I continue to believe that on Sept. 11, 2011, you will be able to walk a plaza with trees,” he said, but as to whether the waterfalls will be running then, he said “probably.”

The mayor also said a compromise was possible although he suggested having three governors in eight years did not make it easier.

“Perhaps we can put the genie back into the box and get everybody calming down and come up with an agreement because I think we weren’t that far away,” he said. “The problem really at this point in all fairness to Silverstein is the Port Authority….Every time you get a new governor everything stops while they bring in their people and do some research.”





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