In a surprise announcement yesterday, Governor Pataki said the state will bypass the city and commit its half of the remaining Liberty Bonds to developer Larry Silverstein for the construction of the Freedom Tower and another commercial office building at ground zero.

The city’s Industrial Development Agency had been in charge of reviewing Mr. Silverstein’s application for the entire $3.35 billion in federally authorized, tax-exempt bonds. But the city has been haggling with the developer over several issues, including a construction timetable and the amount of the developer’s fee, and yesterday Mr. Pataki decided to go ahead and commit the state’s $1.67 billion share of the bonds.

Mr. Silverstein hailed the governor’s decision as a victory. He said the $1.67 billion in bonds would finance the construction of the Freedom Tower and another commercial office building, commonly known as Tower 2, at ground zero’s northeast corner. Tomorrow, Mr. Silverstein will name the architect and announce the timetable for construction of the 65-story, 2.4-million square-foot building.

The governor appeared to tie the state’s bond inducement to the resolution of ongoing negotiations between Mr. Silverstein and the Port Authority, which owns the site and leases it to the developer, within 90 days. Among the issues being discussed is Mr. Silverstein’s control over parts of the site, raising the possibility that the developer may cede control over other building lots.

The president of the Empire State Development Corporation, the state’s development agency, Charles Gargano, said yesterday that preliminary discussions have already taken place between Silverstein Properties, the state, and the Port Authority over transferring control of two building sites along Church Street back to the Port Authority.

“We are working toward that. Certainly we have a lot of work to do,” Mr. Gargano said, adding that Silverstein Properties “made it clear to us that they have the legal right to put up the buildings, but obviously they would be willing to discuss” a deal.

Despite the state’s signal that it may take over those sites, Mr. Silverstein said he would continue to pursue the city’s remaining allotment of $1.67 billion in Liberty Bonds, which he would use for the construction of two office towers.

“We remain committed to resolving the city’s remaining issues and are confident we will ultimately be allocated the remaining $1.67 billion in Liberty Bonds so we can advance quickly on towers three and four,” Mr. Silverstein said in a statement.

At a public hearing last week, the president of the city’s IDA, Andrew Alper, indicated the state and the city were working in unison for the Liberty Bond allocation. But Mr. Pataki’s surprise announcement, made without fanfare at a question and answer session with reporters, suggests a split between city and state.

Deputy Mayor Daniel Doctoroff said yesterday that tying the state’s bond allocation to the resolution of negotiations with the Port Authority could advance the rebuilding schedule. But Mr. Doctoroff said, “We still remain concerned about paying excessive developer’s fees and not having a construction schedule that is strictly enforced.”