First off, FoxNews wrongly inserted the government in their article. It's not the fed that's causing the problem. It's the NY Port Authority.
Second, it's a local issue same as the mosque in the sense that both have to paid for building permits and abide by local zoning ordinances. I understand people's rationale for insisting that the President remain mute on the mosque issue, but no one - not even the Port Authority - is denying the Greek Orthodox church from being built. The Port Authority and the church are just at odds with aspects of the funding to rebuilding it.