Sharon is interested in Justice Minister Tzipi Livni's plan whereby Israel demolishes Gaza settler homes, and the Palestinians clear away the rubble, sources in the Prime Minister's Office said Saturday night.
The sticking point is that the cost of removing the rubble would run NIS 80 million (about USD 18 million), and so far, there is no one to pick up the tab.
"The Palestinians are seemingly interested in the idea that we demolish the homes. The problem is that there is no third party who would agree to pay for the clean up," the source said.
Neither the Palestinians nor the World Bank, which might pay for the clean up, ever completely rejected Livni's plan.
"If the Palestinians go along with the idea and Israel will not be accused of demolishing homes, then this is seemingly the best solution," said senior sources.
But they warned that the plan has not gone beyond the discussion of basic principles.
For months, Jerusalem has been going back and forth on the issue of settler house demolitions. The fear is that terrorist groups will celebrate on the captured rooftops, waiving their flags.
Sharon will present the plan this week when he meets with PA Chairman Mahmoud Abbas.