By Dan Merica, CNN

(CNN) - A decade after the 9/11 attacks, the Port Authority of New York and New Jersey and the Greek Orthodox Archdiocese of America agreed Friday to rebuild the destroyed St. Nicholas Greek Orthodox Church in Manhattan.

The agreement stipulates that the church be rebuilt near the original site with slight modifications to the archdiocese's desired plans, the most noticeable being a nondenominational bereavement center at the east end of the structure.

“Rebuilding St. Nicholas Church, with a nondenominational bereavement center, is not just good news for the Greek Orthodox community, but for all New Yorkers,” New York Gov. Andrew Cuomo said in a statement. “With this agreement, we are continuing New York’s collective healing, restoration and resurgence.”

The plan comes after a four-month study that concluded building the church at 130 Liberty St. would significantly reduce the cost and have no impact on the reconstruction schedule of the new World Trade Center.

“Our pledge is to be a witness for all New Yorkers, that freedom of conscience and the fundamental human right of free religious expression will always shine forth in the resurrected St. Nicholas Church,” Archbishop Demetrios said in a release about the agreement.

The church has been in Lower Manhattan for 85 years and was founded by Greek immigrants. The congregation of about 70 families pledged to rebuild the church after the structure was engulfed in debris and flames on 9/11.

Until Friday’s announcement, however, no real progress had been made.

In 2008, both sides tentatively agreed the church would be built near the original site, using millions of dollars in taxpayer money. But the following year, the Port Authority said the church made extra demands that threatened the construction.

According to Stephen Sigmund, a Port Authority spokesman, the issue in 2009 was whether "tens of millions of public dollars should be spent to move the site to a different site on the World Trade Center site to build a church six times the size of the original church, and to make sure any arrangements for that didn't further delay the construction of the World Trade Center site."

Reprentatives from St. Nicholas told a different story at the time though.

"In our perspective, they walked away," Peter Drakoulias, an executive member of the church board, said in 2010.

To broker a deal, the leaders of the archdiocese reached out to New York Mayor Michael Bloomberg.

“In 2009, Archbishop Demetrios sought my help in convening the Port Authority and state leadership to work on a solution, and I was glad to be of assistance,” Bloomber said in statement Friday. “Now, thanks to cooperation between all parties, a plan has been put in place that will give the community a new sanctuary and place for healing.”

As part of the new agreement, the church has agreed to swap its 155 Cedar St. land, the plot of the original church, with the land rights to the new church on Liberty Street. The Port Authority will now be responsible for all below-ground construction costs, while the archdiocese will pay for all costs related to above-ground construction.

Representatives of the Port Authority and Greek Orthodox Archdiocese signed the agreement Friday. The Port Authority board must now approve the final agreement, and upon doing so, all litigation between the archdiocese and the Port Authority will be terminated.

CNN's Eric Marrapodi, Mary Snow and Alexia Mena contributed to this report.