Published: November 16, 2008 10:58 pm      

NIAGARA FALLS: Banked casino funds dwindle

In Niagara Falls, $18 million adds up fast.

A list of proposed capital improvement projects for 2009 likely will be delayed because the city’s remaining casino cash is running low, City Controller Maria Brown said last week.

“We are still putting a plan together but won’t be able to move forward on any project for 2009 until more funds come in,” Brown told the City Council. “We’re going to have to put the capital project on the back burner.”

For 2007, the city received a total of $18 million through the casino gaming compact with New York. That amount was up from $14 million in 2006. Still, a long list of obligations, donations and initiatives has eaten up the windfall.

Under a cash distribution agreement approved by state lawmakers, the city’s portion of the revenue is shared with the Niagara Falls School District, Niagara Falls Memorial Medical Center, Niagara County and the Niagara Frontier Transportation Authority for the construction of the new airport terminal. The remaining money must be used to enhance economic development in the city.

Brown said she couldn’t give a firm estimate on the remaining balance because some of the funds have been allocated but not yet transferred out of city accounts. She has frequently cautioned the city about not spending the money freely and the need to assure it’s being used for the designated purposes outlined in the compact.

“It’s dwindling down very quickly,” she said. “We don’t have a lot left because we’re giving it away for a variety of things.”

Though it hasn’t yet been approved by the City Council, Mayor Paul Dyster has agreed to give $3 million in casino cash to the Niagara Falls Housing Authority to cover the cost of removing incinerator ash at the site of the planned HOPE VI housing development. If approved, $2 million will come from the city’s current balance and the remaining $1 million will be taken out of casino revenues coming in 2009.

Other recent casino cash allocations include $700,000 to increase building demolitions in the city, $250,000 for the renovation of the old Dome Theater on Main Street and an additional $137,335 to Memorial Medical Center for emergency repairs to its parking ramp.

Hospital Spokesman Patrick Bradley said an engineering survey on the ramp revealed a number of beams and columns that need to be repaired due to age and wear and tear. If not fixed in a timely fashion, the ramp would possibly have to be closed for safety reasons, which would put a burden on the entire neighborhood surrounding the hospital, he added.

“It is the busiest and best used ramp in the city and is filled to capacity most weekdays,” Bradley said. “It’s also the only convenient parking facility for Memorial’s patients and visitors, most of whom live in Niagara Falls and many of whom are frail, elderly, disabled or dealing with significant mobility issues.”

Despite approving all of the past casino cash allocations, council members were surprised to hear the balance is getting low. Council Chairman Samuel Fruscione credited Brown with keeping a close watch on expenditures.

“She’s an excellent controller,” he said. “We always take her recommendations seriously.”

However, Fruscione said the situation isn’t critical and can be improved upon.

“It’s time to reassess what we’re going to do,” he said. “We need to tighten up our belts and stop the spending.”

Earlier this year, the council approved the use of casino revenue to offset the cost of completing $7.6 million in proposed capital projects that included improvements for public safety, Department of Public Works and numerous other areas. The council also spent $130,000 to lease Pothole Killer machines over the summer to do a blitz of city streets.

Brown said the city will still compile a list of proposed projects for 2009, but most of it would have to wait for more casino money to come in. She has advised against bonding for such projects.

“These are the types of things we were trying to avoid,” Councilman Chris Robins said about the lack of funds for capital projects.

Councilman Robert Anderson Jr. added, “we need to save something for a rainy day in case there’s an emergency in this city.”

Meanwhile, block club leaders in the city also have started wondering where all the casino cash has gone. Last month, Roger Spurback, current president of the block club council, called for an audit of all funds received from the casino since the compact began in 2004.

Spurback, who has moved out of the city and announced he will be stepping down as council president, estimated more than $50 million has been received over the last five years.

“We are curious as to how much went to streets, sidewalks, trees and parks,” he said last month. “Without clean safe neighborhoods, business corridors will fail and not grow.”

Contact reporter Rick Forgione

at 282-2311, ext. 2257.