(Recasts with vote delay)
By Hilary Russ
NEW YORK, April 23 The board of the Port
Authority of New York & New Jersey on Wednesday delayed a
scheduled vote on whether to provide $1.2 billion in loan
guarantees to World Trade Center developer Larry Silverstein,
the latest holdup for the project.
The request from Silverstein, who needs Port Authority
backing to secure a construction loan for 3 World Trade Center,
the complex's next skyscraper, recently became entangled in a
debate over the agency's mission after the "Bridgegate" scandal
rocked New Jersey Governor Chris Christie's administration.
Wednesday's delay came after the Port Authority's chief of
staff told the board he had not yet brokered a good enough deal
to recommend approval.
The loan guarantee is meant to be part of an agreement that
would provide hundreds of millions of dollars more to the Port
Authority and allow it to foreclose on the $2.4 billion tower if
Silverstein cannot pay debt service costs.
By not reaching a final deal, an existing 2010 deal with
Silverstein remains in place, one that Silverstein has not been
able to meet because he has been so far unable to raise the
senior debt required to build the tower.
Silverstein has made progress on two of the other four
planned towers at the site. The "Freedom Tower" at One World
Trade Center is slated to open later this year, and the smaller
4 World Trade Center opened in November.
He has spent about $500 million of insurance proceeds to
build the lower eight floors of 3 World Trade Center under the
2010 agreement because some of the below-ground infrastructure
there was needed to support a Port Authority transit hub.
In recent days, the Silverstein loan guarantee deal became
enmeshed in a fierce debate within the agency over its mission,
including whether it should be in the real estate business.
Many of those questions have arisen since the so-called
Bridgegate scandal this year, in which operatives loyal to
Christie's administration are accused of causing traffic jams on
the George Washington Bridge in retribution for a New Jersey
mayor not endorsing Christie's reelection.
The controversy has led to scrutiny of Port Authority's
operations and the resignation of its deputy executive director
and board chairman, both Christie appointees.
Most pertinent to Silverstein, it has led to rare open
debate at the authority, and to creation of an internal
oversight committee examining operations, governance and
Critics argue that rebuilding the World Trade Center, which
was devastated on Sept. 11, 2001 in hijacked plane attacks, has
taken too much time and energy away from other projects that are
critical to its bi-state transportation mission.
(Reporting by Hilary Russ; Writing by Dan Burns; Editing by