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The State Department unveiled on Friday its "top hat" proposal to add three new floors to the U.S. Embassy in Moscow, a building that has never been occupied because it was riddled with listening devices.

The department came up with its latest proposal - to tear off the embassy's top floor and add three more - in an effort to compromise with Congress, said Richard Boucher, the department's spokesman.Boucher said the department still believes that the best solution is to tear down the eight-story structure and replace it with an entirely new building.

"Despite our efforts over the past years, however, we have not obtained congressional funding for the solution . . . so we are looking for other possibilities," he said.

The most viable option, he said, is the so-called top hat. "This proposal is to achieve the badly needed secure space in Moscow."

The three new floors would be built by Americans using American materials "shipped directly and shipped securely from the United States," he said.

The plan would cost $200 million, compared with $300 million to tear down the building and replace it from the ground up, the department said.

Ivan Selin, an undersecretary of state for management, has informed Senate and House subcommittees of the new proposal.