NEW YORK (CBS 2/ WCBS 880 / AP) — The Port Authority of New York and New Jersey formally approved a deal Thursday with the developer of the World Trade Center site over how to help pay for two towers.

LISTEN: WCBS 880’s Marla Diamond reports

Port Authority chairman Anthony Coscia called the agreement “a major milestone” in the redevelopment of the site.

Stakeholders will share the financial risk in such a way as to protect limited public resources, said Chris Ward, executive director of the Port Authority, which owns the site.

Developer Larry Silverstein hailed the agreement as “fantastic news.”

The vote sealed a deal the two sides had tentatively agreed on in March.

It calls for the Port Authority to put up $1 billion to help finance a 64-story building already under construction. The money would only be used if the building doesn’t repay its debt.

The agency also has agreed to provide $600 million backup financing for a 71-story tower, if Silverstein finds tenants and raises $300 million in cash.

“Downtown has emerged as one of the world’s most exciting mixed-use neighborhoods, offering an unparalleled blend of high-tech office space, retail, residential living and cultural attractions,” Silverstein said in a statement. “This agreement will ensure that we continue this momentum with a new generation of cutting-edge, green skyscrapers becoming available starting in 2013.”

Plans for a third Silverstein tower are on hold until market conditions improve.

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