NEW YORK (CNN/Money) - As one door closed Thursday morning, officially ending the clean-up of the World Trade Center after the Sept. 11 attacks, another opened as rebuilding efforts at the site begin.
The swiftness and lower-than-predicted cost of the Ground Zero clean-up effort have amazed many observers and paved the way for New York City to move forward with rebuilding plans that should stimulate the local economy.
Initial estimates had set costs for the recovery and clean-up at nearly $1.5 billion. But after more than 8 months and 1.6 million tons of steel and debris, the city of New York has said it plans to bill the Federal Emergency Management Agency (FEMA), which will pay the tab out of federal dollars, about $750 million -- half the original estimates.
"They were able to do it for a lot less and a lot quicker than people thought," said Jordan Barowitz, a spokesman for Mayor Michael Bloomberg's office.
A special ceremony Thursday morning marked the end of the recovery effort with workers carrying an empty, flag-draped stretcher out of the site in memory of the 1,720 people whose remains were not found after they perished in the collapse of the twin World Trade Center towers. The silence of thousands of onlookers marked the official end of the clean-up at 10:29 a.m. ET -- the hour the second tower fell on Sept. 11.
While government officials didn't set an official date back in September for the completion of the clean-up, the goal was to finish by May to late June, said Brad Gair, federal recovery officer for FEMA. "The around-the-clock operation, 24 hours-a-day, has resulted in cost savings," he said.
|Ceremony at Ground Zero
Some of the savings may have resulted from the fact that although the foundation of the towers needed repair, it was not completely destroyed -- something that contractors might not have anticipated before they dug beneath the rubble, said Matthew Monahan, a spokesman for New York City's Dept. of Design and Construction.
With the end of the clean-up effort, control of the World Trade Center will now be transferred to the Port Authority of New York and New Jersey, which owns the site.
Government and private sector analysis shows it is important to act fast on rebuilding the area in order for the local economy to thrive again.
"The economy can turn around, but businesses need to see that the rebuilding effort is underway," said Ben Chevat, chief of staff for New York Congresswoman Carolyn Maloney. "It can help build confidence that Lower Manhattan is a good place to do business."
Some of the rebuilding efforts already have begun, including the reconstruction of two New York City subway lines, the New Jersey PATH train station and the rebuilding of 7 World Trade Center, a private structure that soon will house a Con Edison substation, Gair said.
Efforts to restore mass transit are a positive step in making downtown a more attractive place to work again since people will be much more inclined to work in the area if they can get there easily, said Lawrence White, an economics professor at the New York University Stern School of Business.
PATH train service from New Jersey should be running again in close to 18 months, said Mike Marr, a spokesman for Empire State Development, a developer working with the Port Authority on rebuilding efforts.
Read more on the economic toll of the Sept.11 attacks
Funds for reconstruction will come from several sources, including the federal government, insurers and the Port Authority, which already has provided about $544 million for the reconstruction of the PATH terminal, Marr said.
Beyond Ground Zero, the government has implemented incentives to lure both business and residential tenants back to downtown. By agreeing to live in one of two specified zones downtown, renters and condo buyers will get a 30 percent discount on their rent or purchase price, up to $12,000, over two years. Families that commit to living in certain downtown areas for one year could receive up to $1,500 under grants proposed by the Lower Manhattan Development Corp.
Earlier this month, the Port Authority announced an initial timeline for discussion and breaking ground for new buildings in the area, to take place in three phases. The first public meeting to discuss options for the land took place May 23, and the group selected an architect, the firm Beyer Blinder Belle, last week.
Construction plans for the site are to be announced in December, and so far several ideas have been tossed around, from a public park with a memorial to another set of twin towers.
A Federal Reserve Bank of New York study estimates the cost of rebuilding the World Trade Center at between $26 billion and $29 billion, down from earlier estimates of $35 billion. The study also estimated that the city will lose more than $10 billion in tax revenue by the time redevelopment of the site is completed.
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Whether the site will hold office towers in the same vein as the former trade center, attracting businesses, or a public park, drawing in tourism dollars, development will help stimulate the New York economy, said Wayne Ayers, chief economist at FleetBoston Financial.
"It does a lot for the economy just having a whole bunch of extra people working there and spending money -- there's an immediate positive affect on spending," NYU's White said of the rebuilding efforts.
Buying goods to build the new structure and employing workers to construct it also will put money back into the system.
"Given the hole we were in literally and figuratively after Sept. 11, this is clearly a plus," White said.
While White predicts that the brokerage houses, whose offices were destroyed Sept. 11, won't concentrate their employees in one location again, he said the firms -- including Merrill Lynch and Lehman Brothers, both of which have moved some offices back to the World Financial Center -- will renew their presence downtown at some point.
The New York Stock Exchange and the American Stock Exchange seem to be committed to their Wall Street-area locations, and White forecasts that the commodities exchanges will make their way back into the area, meaning the traders -- and their wallets -- won't be far behind.