Is Bloomberg Beating Retreat On Zero Vow?

The Mayor walked into the Daily News building Oct. 21 to get an endorsement.

He ended up with a campaign plank instead: Get Larry Silverstein out, and Mike Bloomberg in at Ground Zero.

The applause was deafening. Then came the scrambling and the confusion.

Sources familiar with the rebuilding process—many of whom have long hoped the city would take a stronger role in the effort—told The Observer they were befuddled by the Mayor’s comments, even as they were sympathetic to them.

That’s because Mr. Bloomberg had seemed long ago to give over control of the site to the Governor.

Now, two weeks before an election and eight days after a Quinnipiac Poll showed just how much New Yorkers wanted to see the Mayor in charge at Ground Zero, he was sticking out his neck.

Aides sought to dispel the charge of electioneering.

“The fact that there is an election is irrelevant,” Daniel Doctoroff, the deputy mayor for economic development and Mr. Bloomberg’s chief aide on the rebuilding process, told The Observer. “What he hopes to do is prompt discussion, and I think it already has, and I’m sure it will continue.”

Still, the Mayor’s words brought him clear political advantage with minimal risk: Who, after all, would side with real-estate developer Larry Silverstein in all of this?

“It would be in the city’s interest to get Silverstein out,” the Daily News quoted the Mayor as saying. “Nobody can figure out how to do it.”

Now comes the hard part: carrying it out.

The Mayor has shown signs of backing away from his statements since the Daily News article appeared—although in such a way as to appear not to be backing away at all.

Mr. Silverstein didn’t need to get pushed off, the Mayor explained, but Towers 3, 4 or 5 could be partially converted to residences, or a hotel—which the market would cause to get built more quickly. Office space, currently planned for the site, is going begging downtown.

His comments had angered and emboldened Mr. Silverstein, and his allies in Albany. In the days since, the Mayor has had to have talks with the developer to get on a better footing with the man presently holding more than $4 billion in funds earmarked for the redevelopment of Ground Zero.

In conversations with City Hall in recent days, according to a source familiar with the discussions, the Silverstein camp sought to show the Mayor that it was not Mr. Silverstein that was holding up progress on the site.

It will take until late 2008 before the bathtub for Towers 3 and 4 is finished, the source said.

On top of that, the source said, other logistics prevent the simultaneous building of all five towers at once: Consider the traffic, pollution and noise. A nice place for condos indeed.

“They’ve had a productive exchange of views,” said Mr. Doctoroff. “I think what he was trying to say was that he was not redoing the whole master plan, he was not saying we have to move everything to residential,” Mr. Doctoroff told The Observer. “We just have to find a way to move things along more quickly. If we leave it to the market, which is what private developers would tend to do, it might not be in the city’s best interests.”

The logistics of buying out Mr. Silverstein are complex, if not impossible—and it may not have been what the Mayor was trying to emphasize in the interview. It was, however, what gave the story legs.

Nor was it clear the Mayor knew just what would be involved in changing the function of the property. The Port Authority charter would have to be changed to permit residential development at the site, a process that the Mayor said “would not slow anybody down two minutes.”

In reality, changing the charter would require approval by both the New York and New Jersey state legislatures, according to Port Authority spokesman Steve Coleman.

“It’s possible that he may have been off the reservation in saying what he said, but it’s not because he doesn’t feel that way,” said one acquaintance. “This is a long, heartfelt belief that he was articulating.”

Fair-Weather Friend?

It probably is. What New Yorker doesn’t have heartfelt feelings about what should happen at Ground Zero?

And yet many of the Mayor’s admirers involved in the rebuilding process have seen this fervor come and go before.

The Mayor’s allies have said that he has a longstanding interest in seeing Ground Zero revitalized by people living, shopping and going to cultural events at the World Trade Center site—but that interest has waxed and waned.

Three years ago, Mr. Doctoroff proposed that the Port Authority, which owns the W.T.C. land, trade a couple of revenue-rich airports for 16 acres in lower Manhattan. It ended up looking like a spaghetti bowl worth of lawsuits, and Mr. Silverstein has proven pretty good at those. Talks broke down.

Then this August, as the city-state agency overseeing the planning at Ground Zero, the Lower Manhattan Development Corporation, gave the Freedom Center the third degree, Mr. Doctoroff alone spoke up in defense of an open and fair process. Instead of openness came the single-handed decision by the Governor to move the controversial Freedom Center from its promised building.

Then and only then did other members of the LMDC cry out.

Of course, the Mayor was supposed to be equally represented on the LMDC, but he has not filled four of the eight seats he gets to appoint.

For instance, the same November 2004 agreement that Governor Pataki and others have pointed to this week, in which Mr. Doctoroff approved the 10 million square feet of office space, also binds all parties to mutually agree on “any decision that will have an impact on cultural facilities at the WTC site,” according to a copy of the agreement obtained by The Observer through a Freedom of Information request. When the Governor shoved aside the Freedom Center, the Mayor called it unfortunate. He didn’t try to block him.

By proposing a residential tower or two, Mr. Bloomberg was in fact picking up on an idea that a well-informed source told The Observer has been circulated quietly in recent months by the New Jersey contingent of the Port Authority: turn Tower 5 into condominiums in order to finance further construction of the site.

Tower 5 is supposed to be built on the south side of Liberty Street, where the badly damaged and contaminated Deutsche Bank building is now located.

That site is owned not by the Port Authority, the way the rest of the W.T.C. site is, but rather by the LMDC.

The advantage of locating condos there is that the LMDC does not have a charter that, like the Port Authority’s, prohibits residential development there.

The disadvantage of locating towers there is that the dismantling of the Deutsche Bank building isn’t scheduled to be complete until spring 2007.

Assuming, of course, it meets its schedule. Is Bloomberg Beating Retreat On Zero Vow?