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The opening salvo in what is expected to be a lengthy, multi-million dollar lawsuit against the Niagara Frontier Transportation Authority will be fired this week.
State Supreme Court Justice Amy Fricano will hear arguments Thursday as to whether or not local hotelier John Prozeralik has standing as an injured party to sue the Niagara Frontier Transportation Authority for gross dereliction and negligence in their operation of the Niagara Falls International Airport.
In addition to seeking monetary damages, Prozeralik is asking the court to remove the NFTA from control of the airport on the grounds that the authority has flagrantly violated its operating contract with the city.
Such a ruling would deny the NFTA the power to enter into a controversial 99-year lease agreement with a Spanish corporation, Cintra SA, to run the airport.
The arguments were originally scheduled to be heard by Justice Ralph Boniello. He recused himself from the case on the grounds that he had served as counsel to the Niagara County Industrial Development Authority, which lost out to Cintra in the NFTA's bidding process.
Sources in the legal community say the case will be a tough call for Fricano, adding that Thursday's hearing will likely mark the beginning of a long, drawn-out legal process.
"Whichever way the ruling comes down, you can bet the other side will immediately appeal," an attorney familiar with the case told the Reporter.
Prozeralik said he is prepared to spend "any amount" to stop the Cintra deal, which he characterizes as "the lease from hell." He is being represented by Richard Sullivan, a skilled attorney who took on some of the best legal minds in the country in helping Prozeralik win a multi-million dollar libel suit against ABC Capitol Cities several years ago.
There has been considerable opposition to the Cintra deal since it was first announced. Niagara Falls City Councilman John Accardo and county Legislator Renae Kimble have joined Prozeralik as plaintiffs in the suit, and more than 20,000 area residents signed petitions opposing the deal.
Additionally, Rep. John LaFalce has raised a number of troubling issues, and is working behind the scenes with the Department of Defense and the Federal Aviation Administration to block, or at least amend, the lease.
And some have gone so far as to call for a Justice Department probe into the NFTA's handling of the matter.
LaFalce has charged that representatives of Cintra misrepresented their level of involvement in the operation of nine airports in Mexico, that they have little background in airport operations and that the company doesn't have enough money to operate the Niagara Falls facility without significant federal, state and local subsidies.
Furthermore, he has expressed doubts as to whether the NFTA would ever collect any rent on the lease and questioned whether Cintra actually intends to bring passengers to Niagara Falls or take them from here to Mexican destinations in which the company has an interest.
The Congressman has also raised national security concerns, which have been heightened dramatically since the Sept. 11 terrorist attacks. The airport is home to the Air Force's 914th Tactical Airlift Wing and the Air National Guard's 107th Air Refueling Wing. Elements of both outfits are currently involved in the Afghan campaign. Privately, LaFalce said, some in the defense community have voiced grave concerns about turning the airport over to a foreign corporation.
"I've raised some questions and, as far as I'm concerned, they are very valid questions," he said. "You've got to make sure you don't give away the keys to the kingdom."
LaFalce's objections to the FAA have succeeded in delaying approval of the lease agreement and, since Sept. 11, federal approval for the lease has become "a whole new ballgame," a Washington source told the Reporter.
"Under the lease agreement, Cintra is permitted to sell up to 49 percent of its interest in the airport to anyone, with no government oversight," the source said. "Given what this country's just been through, I don't think that's going to happen."
Prozeralik has charged that the lease agreement is nothing but the latest outrage in an ongoing effort by the NFTA to keep the airport dormant in a misguided attempt to protect the Buffalo airport, which the authority also controls.
"For 30 years, the NFTA has done nothing with our airport and now that they've made it just about worthless, they decide to sell it," he said. "They've deliberately programmed it this way."
The 99-year lease contains no mandatory performance standards and doesn't require Cintra to put any money into the operation for the first 13 years. In fact, over the entire term of the lease, Cintra is only required to spend $10 million, around $100,000 a year.
"You can't buy one of the jacks they use to change an airplane's tire for $100,000," Prozeralik said.
To add insult to injury, the NFTA agreed to actually pay Cintra $3 million during the first years of the lease to help the company get going.
Aviation industry sources told the Reporter that the NFTA's Request for Proposals package itself was responsible for the fact that only one non-local proposal was received. Aside from the fact it was only advertised in Western New York and not in any aviation industry journals, it was sent out in August, a time when most Europeans are on vacation.
"The request itself was rubbish," one international airport operator told the Reporter. "There was a provision about people waiting on line at the counter having 18 inches of space between them. We thought, 'What's this all about?'"
While Cintra, in response to questions posed by LaFalce, said there would likely be no passenger service at the airport for at least five years, Prozeralik said it could happen a lot sooner.
Discussions with travel industry officials in Great Britain, Eastern Europe and the Far East have convinced him that charter flights to the Falls could begin almost immediately, bringing with them badly needed tourist dollars.
"The Niagara Falls International Airport could potentially be the most valuable piece of real estate in the county, and I'm not going to allow them to give it away," he vowed. "We're going to win this thing because right is on our side."