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COUP D'ETAT BY FRUSCIONE-LED COUNCIL MAY STOP DYSTER-LED INSOLVENCY

By Ron Churchill

With the city $6 million in the red, Council Chairman Sam Fruscione has staged a financial "coup d'etat" against Mayor Paul Dyster, freezing all spending and all hiring without direct approval by Fruscione and the City Council.

A resolution expected to pass on Monday (April 2) calls for an immediate stop to what Fruscione calls "irresponsible" spending by the Dyster administration.

"The days of freewheeling expenditures on consultants, reports and questionable projects are over," Fruscione said, comparing his move to a "coup d'etat" like the overthrow of Anastasio Somoza Dabayle by the Sandanista National Liberation Front in Nicaragua in 1979.

"The loss of the casino revenue is causing us to take a hard look at our past spending and all future spending. While we hope this casino cash crisis is temporary, we can never again take those dollars for granted. As a result we're going to put spending constraints in place that will better, and more realistically, serve the city as we move forward," Fruscione said.

The resolution, sponsored by Fruscione, Glenn Choolokian, and Bob Anderson, calls for the following measures:

"Unless and until advised by the city controller to the contrary, this City Council will not approve any requests for spending from the mayor or department heads for non-budgeted items," and "unless and until advised to the contrary by the city controller, this City Council will not approve any requests for the hiring of non-budgeted personnel from the mayor or department heads."

City Comptroller Maria Brown said, "We have to be very cautious. Everybody has to be aware of what's going on.

"We could potentially have another $6 million in debt by the end of this year. We could potentially -- at the end of 2012 -- have a $12 million deficit, and a city our size cannot sustain a deficit like that," said Brown, a certified public accountant with more than 15 years in the City Comptroller's office.

"They thought they were going to get the casino money for 2010 and 2011, which would have totaled $15 million," she said. "My concern is that, as time goes on, I've got to keep paying payroll, debt service payments, and then the pension bill doesn't come in until the end of the year, and that's massive. I actually thought that the casino funds were coming in this year."

A comment by Lt. Gov. Duffy that there was "no timeframe" on the Seneca Nation-New York state dispute regarding the casino cash was the root of the spending freeze, officials say.

"Everybody has to stop right now," Brown said.

Former mayor Vince Anello says city officials should be speaking more loudly when it comes to the casino cash issue.

"First of all, as far as the city government, it needs to make its presence known and be more vocal about what the impact is on the city of Niagara Falls," Anello said. "As far as taking over the spending, that can only be done after the comptroller does an audit and declares a deficit. The issue with that is that once the comptroller determines there is a deficit, then what happens is the entire budget would be open and the Council would work on the new budget for the year.

"We're being used as pawns in a fight between two giants -- the Seneca Nation and the state of New York," Anello said. "I'm not overly nervous about the payments that are due to the city. It's a contract, so sooner or later they have to come up with the money.

"I understand the strain that the city is under. I think what we need to do is make our presence known, and I have my own ideas about that, and to certainly develop a better relationship with the Seneca Nation and the Seneca Gaming Corp.

"When I was in office, I was well acquainted with the Seneca president. I was well acquainted with the corporation that runs the casino. I made it my business to let them know that we need to be good neighbors.

"Have city officials made an assessment if it's a good policy, even though it's state policy, to build other casinos in Western New York?

"Elected officials should make their feelings known. Is anybody looking into that? Why aren't they speaking their minds? Are they going to wait until it's too late? I personally believe that another casino -- including the one in Buffalo -- is not going to help the city of Niagara Falls."

E-mail Ron Churchill at ronchurchill@yahoo.com.

Niagara Falls Reporter www.niagarafallsreporter.com April 3 2012