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Gov. George Pataki and Seneca Nation President Cyrus Schindler this week will reportedly announce the acceptance by both sides of a compact that will result in the opening of a casino in Niagara Falls. A referendum on the Seneca Nation will be scheduled before May 10, sources in Albany and on the reservation agreed.
Additionally, Niagara USA Development Corp. last week issued a request for proposals to rehabilitate the vacant United Office Building as a hotel, residential or mixed use facility. Niagara USA officials have described the 20-story art deco landmark as the downtown's "signature" property.
But it's unlikely that the casino will open before the end of the year, and the United Office Building has proven to be a Waterloo for any number of developers over the past two decades. And the state has said nothing about closing the parking lots at the Niagara Reservation or removing the closed section of the Robert Moses Parkway nearest the falls, both once seen as crucial for a downtown renaissance.
Those trying to do business in the area were hit with a 17 percent property tax increase last year, which was compounded this year by a reassessment that raised values on some properties by as much as 100 percent.
James Copia, who owns a number of rental properties along Rainbow Boulevard and Buffalo Avenue, said the reassessment may be the straw that breaks the camel's back for local developers here.
"Most of us have been hanging on, waiting for the casino," he said. "But in a lot of cases, the new assessments wipe out whatever margin you had. It's gone from you're just scraping by to you're losing money staying here."
Copia has spent the last 30 years using his own money to buy buildings in the neighborhood and rehabilitating them as rental properties.
"You can't find anyone who would give you what you have in them," he said. "And they want to tax you like the casino's already here and business is booming."
Pataki's expected announcement comes 10 months after a June, 2001 news conference in which he said the casino -- to be temporarily located in the Niagara Falls Convention and Civic Center -- would be open by the start of this year's tourist season. Democrats in the state Assembly immediately embarked on a campaign to delay the deal or sink it altogether, presumably to ensure Pataki would not reap the benefits of the development when he runs for re-election this November.
"It's politics as usual," Copia said. "And it's the biggest reason people are leaving this state in droves."
Pataki's premature announcement has all but killed the convention business here. Niagara USA recently commissioned a 3-month consultant's study to see where conventions might best be held, despite the fact that numerous large buildings in the area -- including the Nabisco warehouse, Falls Street Faire and the Rainbow Centre Mall -- are deserted and looking for tenants.
In the case of the United Office Building, some wonder why the state would choose as its first project a possible hotel development when currently existing hotels struggle with occupancy rates of 40 percent or less.
The building has been vacant since local developer John Prozeralik bought it in the late 1970s with an eye towards turning it into an upscale apartment building. Those plans were torpedoed by the city's Urban Renewal Agency, which awarded an adjacent parcel of land to developers of what is now the Ramada Inn, thus eliminating the only nearby available parking for the United building.
"The city at that time killed any chance I had to make that into a viable project," Prozeralik said.
The property was taken over by Neighborhood Housing Services, which announced a development that would see low-to-moderate income apartments mixed with high-end apartments in the building.
But high costs, the parking problem and opposition by subsequent city administrations served to scotch those plans as well.
In 1999, the building was optioned by Niagara Falls Redevelopment, which ended up putting $1.6 million into it. Unable to find an outside developer to partner with on the building's rehabilitation, NFR turned the property over to the state earlier this year, absorbing its loss in the hope that USA Niagara will have better luck with it.
Still, some wonder why the United Office Building would be the state's first priority.
"They've already got control of the abandoned section of the Robert Moses, and they've already got the parking lots at the state park," one developer said. "Addressing both of those situations would do more for the tourist district than rehabbing the United Office Building at some point down the road."
USA Niagara has given developers 30 days to come up with proposals for the building, though it remains to be seen whether there will be any takers.
| Niagara Falls Reporter | www.niagarafallsreporter.com | April 9 2002 |