Israel would be allowed to finish hundreds of apartments already under construction in West Bank settlements even if it agrees to a U.S.-drafted deal to renew a freeze on new construction, a diplomat familiar with the details said Monday.
The U.S. is pressing Israel to renew a settlement slowdown that expired in September in order to get stalled Israeli-Palestinian peace talks moving again. In exchange, it is offering Israel military hardware and veto protection against U.N. resolutions critical of its policies.
According to the emerging deal, construction would have to halt for 90 days on hundreds of additional homes begun after the first slowdown expired on Sept. 26. But that freeze would not apply to apartments already under construction that were exempted in the first slowdown, the diplomat said.
Officials had earlier given conflicting accounts regarding the fate of those homes.
"From our understanding, what was allowed under the previous freeze can continue. What was not allowed under the previous freeze cannot continue," the diplomat said. He spoke on condition of anonymity because the details of the deal have not been finalized.
According to Israel's Central Bureau of Statistics, 2,140 apartments were under construction in the West Bank at the end of June, the last period for which there are official figures.
It is not clear how many of those homes have been completed since. But to give a rough idea of the pace of construction, nearly 800 apartments were completed in the first six months of the year.
The Palestinians have not said whether they would accept the deal, whose details they have not yet discussed with the Americans, they say. "Once we see it we will meet and have a response," said Palestinian negotiator Saeb Erekat.
The Palestinians have already expressed alarm that the proposal does not include construction in east Jerusalem, their hoped-for capital, but like the Israelis, would find it difficult to resist pressure from President Barack Obama to sign on to the deal.
The Israeli diplomat said the Americans have not set a deadline for an Israeli response.
Israeli settlement construction has become a major obstacle to peacemaking because the Palestinians see it as eroding their claims to both the West Bank and east Jerusalem as part of a future state that would also include the Hamas-ruled Gaza Strip. The Palestinians say there is no point in negotiating if the Israelis continue to build homes on captured territory claimed by the Palestinians.
Israel captured all three territories in the 1967 Mideast war. It withdrew from Gaza in 2005 but continues to control the other two areas, where half a million Jewish settlers live.
Meanwhile, Israeli Defense Minister Ehud Barak told Army Radio that the White House wants to give -- not sell -- Israel 20 stealth jet fighters in exchange for renewing the moratorium.
The $3 billion will come "from the American administration, not from us," he said, and not from an additional $3 billion in annual aid that Israel receives from the United States, Barak said in an interview from Paris.
Cabinet minister Yuli Edelstein had said Sunday that the jets would be sold to Israel.
Israel has already ordered 20 F-35 stealth jets -- next-generation fighters that are set for delivery beginning in 2015. Barak said the U.S. proposal would provide an additional 20 of the warplanes, which developers say would be capable of reaching as far as Iran undetected by radar.
Barak said the supply of the planes was not contingent on concluding a final peace deal. A broad security arrangement that would involve far more military hardware would require a peace agreement, he said.
In a separate development, Israeli troops raided a house in the West Bank town of Tulkarem early Monday, seizing money and possessions of suspected Hamas supporter, Ali Dadu. More than $600,000 in cash, jewelry, computers and vehicles were seized from his home and business, said his son, Bara Dadu.
Ali Dadu was convicted in an Israeli military court in August of laundering money for Hamas, the militant Islamic group that rules the Gaza Strip, the military said.
The military said it was entitled to seize possessions equal to the value of the money laundered and said the confiscation was a "message."
His son called the company a "family business."