City Council Hears Debate on Status of Rebuilding Effort

New York, NY —

Associates of developer Larry Silverstein squared off with Deputy Mayor Dan Doctoroff during a city council hearing on the status of the World Trade Center rebuilding effort.

REPORTER: In hearings interrupted by hissing, applause and a visit from a group of Chinese dignitaries, Deputy mayor Doctoroff reasserted the city's claim's: that Silverstein Properties is in no position to develop all of Ground Zero. He said the developer had inflated rent projections for buildings he would develop. And he said Silverstein was likely to default after building Towers 1 & 2 and that that would leave the Port Authority in the lurch. Silverstein's associates said the city was misrepresenting the issue.

David Kallick, of the Fiscal Policy Institute, said that on the whole, the city was right to question Silverstein's investment.

KALLICK: What the city was saying - what Dan Doctoroff was saying - is that they don't have anything at risk. And I think that's already true today. That they don't have any private money at risk - and that does change the equation, I think.

REPORTER: Most of the Council members were skeptical of Silverstein's projections. However, Councilman David Yassky called on the city to give the developer its remaining Liberty Bonds. Silverstein's associates did not rule out the possibility of relinquishing control of part of Ground Zero.