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Larry Silverstein in Line to Gain From $285M in Unspent Bonds

By Julie Shapiro | December 20, 2010 6:41pm | Updated on December 21, 2010 10:18am
Tower 3, second from the right, is slated to receive up to $285 million in stimulus bonds.
Tower 3, second from the right, is slated to receive up to $285 million in stimulus bonds.
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By Julie Shapiro

DNAinfo Reporter/Producer

LOWER MANHATTAN — New York State’s loss is developer Larry Silverstein’s gain.

Silverstein is poised to receive up to $285 million in tax-exempt federal stimulus bonds for Tower 3 at the World Trade Center, after local governments around the state failed to spend the bonds by the year-end deadline.

Gov. David Paterson signed an executive order on Friday transferring about $285 million of the unspent bonds from city and county governments back to New York State, to prevent them from expiring and going to waste.

All the unspent bonds will go toward Silverstein’s Tower 3, a 71-story skyscraper that will cost over $2 billion and is scheduled to open in 2015, the Empire State Development Corp. said.

"During this time of economic uncertainty, it is vital that we take advantage of the Recovery Zone Facility Bond program to help create jobs, foster economic development and develop critical infrastructure," Paterson said in a statement.

The state received a total of $555 million in Recovery Zone Facility Bonds and divvied them up among dozens of cities and counties for private development projects.

But over half of the bonds were never used, as some local governments said they could not find any projects to do and others scrambled to issue them before they expired.

New York City used just $65.5 million of the $121 million it received in stimulus bonds, and it appears that the rest will go back to the state for Tower 3. Projects the city has financed with the bonds include developments in Brooklyn, Queens and the Bronx.

A spokesman for Silverstein Properties declined to comment.