Israel to subsidize new West Bank homes

JERUSALEM -- The Israeli government has quietly agreed to grant subsidies to build more than 500 new homes in the West Bank, backtracking from a promise earlier this year to deny the incentives to the settlements, The Associated Press has learned.

The planned construction, at a time when Prime Minister Benjamin Netanyahu is trying to shore up support among settlers, has enraged the Palestinians and could cloud a visit by Secretary of State Hillary Rodham Clinton as she tries to re-energize moribund Mideast peace efforts.

The housing units are benefiting from the government's designation of the settlements as "national priority" areas -- a status normally reserved for low-income cities and towns where the government wants to encourage development and lure people to live.

In January, the Israeli cabinet identified more than 550 communities, including 70 West Bank settlements, as national priority areas. The list drew immediate protests from the Palestinians, who view the West Bank as the core of a future state. The United States demanded an explanation of the settlements' inclusion.

Facing international pressure, Israeli leaders quietly held a second vote in a meeting conducted by telephone to exclude the settlements from the measure. Shortly after, Netanyahu told a news conference with visiting UN Secretary-General Ban Ki-moon that the initial cabinet decision was a mistake.

According to the Housing Ministry, however, political leaders have already approved subsidies for one small project of 24 homes in the settlement of Efrat, south of Jerusalem. And nearly 500 other homes in Efrat, Beitar Illit and Ariel are now in the pipeline to receive the incentives, which include a discount of up to $27,000 for infrastructure development.

Ministry spokesman Ariel Rosenberg said it is not clear how many of the 500 homes will be built because construction bids for them have not closed. He noted that subsidies are also available for projects in hundreds of other communities in Israel proper.

Asked about the apparent government flip-flop, government spokesman Mark Regev said: "There are no special incentives whatsoever to encourage people to live in the West Bank. The same conditions apply to 600 communities throughout the country."

Neither the Palestinians nor the international community see things that way.