Niagara Falls Reporter

Despite deal with USA Niagara, city bears cost of Market
The Niagara Holiday Market was listed prominently as a project of USA Niagara, a state agency charged with aiding in the development of downtown Niagara Falls. Mark Rivers, a developer from Boise, Idaho, was given $450,000 in public money to operate the market, which ran from Nov. 26- Dec. 31. The market performed substantially below what Rivers promised when he pitched it for public support. For example he said there would be 80 vendors selling unique crafts and goods at what he said would be the “largest European-style holiday market in America.” Turned out there were less than 30 vendors. He promised the largest outdoor ice-skating rink in the area. He produced a small, rented rink that saw less than 400 skaters even though he claimed it cost more than $140,000. Rivers said there would be a Rockefeller Center- sized Christmas Tree, but he installed a 21-foot tree, less than one-third the size of the spruce at Rockefeller Center. Every element of the Market was smaller and less attractive than promised and both the developer and USA Niagara used pictures of other European markets and computer generated images rather than show the actual market on their websites. Not the least of the exaggerations from both Rivers and USA Niagara was the estimate that 250,000 visitors would attend the market. The Niagara Falls Reporter monitored attendance four times daily throughout the 37 days. We concluded there were under 30,000 attendees. The official audit report of Freed Maxick, CPA, concluded there were no more than 75,000 attendees, although they admitted they had no way to verify the actual attendance. In reviewing Freed Maxick’s report on USA Niagara’s management of Old Falls Street, we learn the Holiday Market was conducted under the auspices of Old Falls Street. USA Niagara may have engaged in a sleight of hand in the way the Holiday Market was funded. To remind readers, USA Niagara was established in 2002 by then-Gov. George Pataki. USA Niagara was supposed to invest money into downtown Niagara Falls and partner with developers to lure economic development. The Reporter revealed the city's contractual relationship with USA Niagara requires the city to pay $2.1 million out of its state aid and up to $1 million more to fund USA Niagara’s management of the Conference Center and Old Falls Street. All told, USA Niagara takes 18% of the City’s state aid. In 2010 USA Niagara lost $969,820. In 2011 they lost $958,396 fror the two operations. USA Niagara conducted the Holiday market as one of Old Falls Street’s projects. They announced they put up half of the money. USA Niagara President Chris Shoepflin called the project a success, making many of the promises himself including the promise of 300 jobs created by the Market, a total exaggeration also. But USA Niagara said they invested $225,000 and hence partnered with the City, who also invested $225,000. After studying the report by Freed Maxick we find the Holiday Market showed losses and was part of the $625,000 in losses USA Niagara incurred on Old Falls Street. So the costs of the Market was included in the bill sent to the City of Niagara Falls. Despite the fact that USA Niagara said they paid half of the Holiday Market, people of Niagara Falls seemed to have borne the cost of the Market. The contract with USA Niagara expires Dec. 31 this year. A majority on the City Council, Chairman Sam Fruscione, Glenn Choolokian and Robert Anderson, appear ready to oppose Mayor Paul Dyster and will refuse to ratify a renewal of the USA Niagara contract. The net result will be the City will have $3.1 million more in its budget and if ever again USA Niagara wants to promote a Holiday Market, they will have to do more than just say they paid for half of it. They will really have to pay for all of it.

Despite deal with USA Niagara, city bears cost of Market

The Niagara Holiday Market was listed prominently as a project of USA Niagara, a state agency charged with aiding in the development of downtown Niagara Falls.

Mark Rivers, a developer from Boise, Idaho, was given $450,000 in public money to operate the market, which ran from Nov. 26- Dec. 31.

The market performed substantially below what Rivers promised when he pitched it for public support. For example he said there would be 80 vendors selling unique crafts and goods at what he said would be the “largest European-style holiday market in America.” Turned out there were less than 30 vendors.

He promised the largest outdoor ice-skating rink in the area. He produced a small, rented rink that saw less than 400 skaters even though he claimed it cost more than $140,000.

Rivers said there would be a Rockefeller Center- sized Christmas Tree, but he installed a 21-foot tree, less than one-third the size of the spruce at Rockefeller Center.

Every element of the Market was smaller and less attractive than promised and both the developer and USA Niagara used pictures of other European markets and computer generated images rather than show the actual market on their websites.

Not the least of the exaggerations from both Rivers and USA Niagara was the estimate that 250,000 visitors would attend the market.

The Niagara Falls Reporter monitored attendance four times daily throughout the 37 days. We concluded there were under 30,000 attendees.

The official audit report of Freed Maxick, CPA, concluded there were no more than 75,000 attendees, although they admitted they had no way to verify the actual attendance.

In reviewing Freed Maxick’s report on USA Niagara’s management of Old Falls Street, we learn the Holiday Market was conducted under the auspices of Old Falls Street.

USA Niagara may have engaged in a sleight of hand in the way the Holiday Market was funded.

To remind readers, USA Niagara was established in 2002 by then-Gov. George Pataki. USA Niagara was supposed to invest money into downtown Niagara Falls and partner with developers to lure economic development.

The Reporter revealed the city's contractual relationship with USA Niagara requires the city to pay $2.1 million out of its state aid and up to $1 million more to fund USA Niagara’s management of the Conference Center and Old Falls Street. All told, USA Niagara takes 18% of the City’s state aid.

In 2010 USA Niagara lost $969,820. In 2011 they lost $958,396 fror the two operations.

USA Niagara conducted the Holiday market as one of Old Falls Street’s projects. They announced they put up half of the money.

USA Niagara President Chris Shoepflin called the project a success, making many of the promises himself including the promise of 300 jobs created by the Market, a total exaggeration also.

But USA Niagara said they invested $225,000 and hence partnered with the City, who also invested $225,000. After studying the report by Freed Maxick we find the Holiday Market showed losses and was part of the $625,000 in losses USA Niagara incurred on Old Falls Street. So the costs of the Market was included in the bill sent to the City of Niagara Falls.

Despite the fact that USA Niagara said they paid half of the Holiday Market, people of Niagara Falls seemed to have borne the cost of the Market.

The contract with USA Niagara expires Dec. 31 this year.

A majority on the City Council, Chairman Sam Fruscione, Glenn Choolokian and Robert Anderson, appear ready to oppose Mayor Paul Dyster and will refuse to ratify a renewal of the USA Niagara contract.

The net result will be the City will have $3.1 million more in its budget and if ever again USA Niagara wants to promote a Holiday Market, they will have to do more than just say they paid for half of it. They will really have to pay for all of it.

Niagara Falls Reporter www.niagarafallsreporter.com Aug 07 , 2012