July 2, 2002

Gov George E Pataki's assertion that nothing will be built where twin towers once stood seems to give credence to something that critics have been saying for months--that Lower Manhattan Development Corp, panel created by Pataki to oversee rebuilding process, is essentially under Pataki's control, and that he alone will determine much about future of site; maps (M) (News Analysis)

Florence Griswold Museum, Old Lyme, Conn, opens new gallery with exhibition of American paintings; photo (S)

Commerzbank agrees to buy 10 percent stake in Ferrari division of Fiat for $223 million; share purchase is part of deal last week between Fiat and Mediobanca, in which Italian bank bought 34 percent of Ferrari while agreeing to sell 12.5 percent to other banks (S)

Officials who control pension funds of New York, California and North Carolina say they will start withholding business from Wall Street firms that do not make same changes to limit conflicts of interest that Merrill Lynch & Co has agreed to make to settle complaint by Atty Gen Eliot L Spitzer of New York; Merrill has agreed to take steps to limit influence its investment bankers have over analysts who make research recommendations for investors; H Carl McCall, comptroller of New York, and treasurers of California and North Carolina together oversee more than $400 billion in pension funds for state workers, which generate tens of millions of dollars in annual fees for firms; photo (M)

Pres Bush hails recent Supreme Court decision upholding use of public money for religious school tuition as 'just as historic' as landmark 1954 ruling outlawing school segregation and as 'great victory' for parents and students; says US cannot have separate education systems for rich and poor; supported voucher programs in 2000 presidential campaign and tried to include them in major education bill signed earlier in year but quickly gave up after lacking enough Congressional support; signals in speech in Cleveland, which first established voucher program that he has new opening to push aggressively on issue; says vouchers are constructive approach for improving public education; vouchers, not popular with all Republicans, are strongly supported by low-income African Americans whose children attend poor-quality city schools and who gave Bush little support in 2000 presidential race; his embrace is quickly criticized by Sen Edward M Kennedy, Democrat and leading sponsor of education bill; says vouchers may pass constitutional muster, but do little to improve quality of nation's schools; says it is wrong to take scarce taxpayer funds away from public schools and divert them to private schools; photo (M)