The families of two firefighters killed in the Deutsche Bank blaze blasted Manhattan prosecutors Tuesday for deciding not to indict government agencies responsible for keeping the building safe.

As first reported Tuesday afternoon at NYDailyNews.com, the Manhattan district attorney's office won't charge the city or state in the August 2007 blaze, three sources close to the investigation said.

Instead, prosecutors plan to bring manslaughter charges against a mob-tied subcontractor, John Galt Corp., and corruption charges against 14 individuals hired to demolish the toxic tower, the sources said.

Firefighters Joseph Graffagnino Jr. and Robert Beddia died in the fire.

District Attorney Robert Morgenthau is negotiating with the city to make some admission of guilt, including acknowledging the Fire Department failed to inspect the building every 15 days, as required.

"Just taking [16] months and millions of documents and thousands of man-hours, and at the end saying, 'Let's make a deal?'" asked an incredulous Joseph Graffagnino Sr. "Why did you waste a year and a half on this sham of an investigation and not do anything?"

Questioned by reporters, Mayor Bloomberg confirmed that "we're negotiating with the district attorney" but declined to offer specifics.

"I don't think anybody thinks that anybody willfully caused their deaths," the mayor said. "We, the LMDC [Lower Manhattan Development Corp.], the state, the contractors, everybody who was involved, we didn't do everything we could have, because if we had done that, these two brave firefighters would be alive."