City on hook for USA Niagara's losses

Somehow the losses on the conference center and Old Falls St. seem to always equal almost one million, per year, the exact amount the city is on the hook to pay.

The mission of Old Falls Street is to “become the leading outdoor entertainment district in Niagara Falls NY, a meeting place that brings people together.” So indeed: This photo is from a July, 2011 Old Falls event called Festival of fools. And yes the fools are the city taxpayers who paid for it.

Vendors and events wound up costing city taxpayers more than one million on Old Falls Street in 2010 and 2011. It should make money but it doesn’t. Why is that?

Part of the city of Niagara Falls’ deal with USA Niagara Development Corporation is that the city agreed to allow USA Niagara to manage the Conference Center and the city-owned Old Falls Street - a two block street from the Seneca casino to the Niagara Falls State park, where vendors sell items and various events are held.

The deal with the city permits USA Niagara to run both venues any way they like and send the bill for losses to the city.

The Reporter got copies of financial audits of these two projects performed this year by Freed Maxick CPA’s.

The city, as per the agreement, is on the hook to pay up to one million in losses every year for these two operations and funny, every year, losses run just about one million.

Salaries were not broken down on the Freed Maxick audit but total personnel costs were. For the conference center salaries were about one million – with an income of less than $2 million.

Old Falls showed an income of $217,835, with salaries of $318,872.

It seems clear these are not run on a business model.

In fact it is hard to fathom how two blocks of outdoor vending booths and a couple of club events, zumba, Pilates and fitness classes, workshops and free movies could have $318,000 in salaries.

Calls for explanations to USA Niagara president Chris Schoepflin were not returned.

In any event, USA Niagara sent a bill to the city saying they lost $560,369 in 2010 and $625,163 in 2011 on Old Falls Street.
They sent a bill for the conference center too. They lost $409,451 in 2010 and $333,233 in 2011.

As per the agreement the city has to pay up to one million total for both venues.

Note how in 2011 as the conference center lost less money, Old Falls Street lost more money.
In 2010, it was vice versa.

Either way it totaled up to almost a million.

In 2010 Old Falls Street and the Conference Center lost a combined $969,820. In 2011 they lost $958,396.

It is almost seems like they planned it this way. Now if that ain’t good old Hollywood accounting, I don’t know what is.