The United States criticized a recently declared Israeli plan to subsidize construction in several West Bank settlements on Tuesday, with a top U.S. official calling the move "unconstructive."

On Sunday, Prime Minister Benjamin Netanyahu's government authorized subsidizing construction in 557 rural settlements, including, according to a report by the Associated Press, 70 in the West Bank.

The newly announced plan offers subsidies that could reach up to 50%-70% of development costs in areas deemed as being national priority areas A and B.

According to the AP report, an English announcement of the project did not include a list of the towns and settlements included in the program, while the original Hebrew announcement was attached to the full list, which reportedly includes 70 settlements, most of them deep inside the West Bank in areas that Israel would likely have to evacuate to make way for a Palestinian state.

The incentives, according to the Prime Minister’s office, are “meant to encourage positive migration to these communities.”

Answering a reporter's question concerning the new plan, State Department spokesman Mark Toner criticized the move, saying: "We've said this many times from this podium and from elsewhere that we view any move that would jeopardize getting these two parties back to the negotiating table."

"We find those unconstructive and unhelpful. We're seeking clarity on what is actually being proposed here," Toner added, saying that "these kinds of actions" could jeopardize "signs of progress" achieved during a recent round of low level peace talks.

"Now [Special Mideast Envoy] David Hale is in the region. He's going to have meetings in Amman as well as Jerusalem and Ramallah. And he'll be back in Washington later this week. But you know, obviously he's there in his capacity, but also I think convey some of these concerns to the Israeli government," Toner added.

The U.S. official spoke of American attempts to push the sides back to direct negotiations, saying that "kinds of actions take place, that, you know, they hamper that process."

"You'll have to ask the Israeli government what their intent is here. But this [negotiations] has to be something that the both sides want to pursue and to do so in a meaningful and committed fashion. It's certainly in both of their interests to be in direct negotiations. Israelis themselves have commented that the status quo is unsustainable," Toner added.

The Palestinian Authority also referred to the Israeli plan, with Palestinian government spokesman Ghassan Khatib saying Netanyahu's cabinet was "adding obstacles at a time when everyone is intensifying efforts to try to resume peace talks.”

“I think with every additional settlement activity, the feasibility of having two states is diminished,” Khatib added.

Both American and Palestinian response came after the cabinet on Monday appointed a committee to examine land ownership issues in the West Bank.

The panel will review a 2005 government report that found several dozen outposts were built not only without state approval, but on privately held Palestinian land.

Officials said the report needs to be reviewed because its author, state prosecutor Talia Sasson, later entered politics with a dovish political party, raising questions about her objectivity.

A court-ordered evacuation of Migron, the largest unauthorized outpost, set for next month, would not be affected by the formation of the new committee, officials said.

The panel’s makeup aroused suspicions it would legalize at least some of the more than 100 outposts built without government authorization, including dozens Sasson says were erected on privately held Palestinian land.

The committee’s head, former Supreme Court chief justice Edmond Levy, spoke out against Israel’s withdrawal of settlers from the Gaza Strip in 2005.