Niagara Gazette

August 1, 2013

Cuomo defers when asked about Hamister hotel project

By Mark Scheer Mark.scheer@niagara-gazette.com
Niagara Gazette

Niagara Gazette — “It’s a local matter.”

That’s how Gov. Andrew Cuomo responded Wednesday when asked for his thoughts on the state of a stalled $25 million hotel proposal for downtown Niagara Falls.

While various elected officials, including U.S. Sen. Charles Schumer, D-N.Y., U.S. Rep. Brian Higgins, D-Niagara Falls and Buffalo, and state Assemblyman John Ceretto, R-Lewiston, publicly expressed hope this week that a deal will still be worked out with Buffalo developer Mark Hamister, Cuomo declined to weigh in on the controversial subject. 

“It’s a local matter and local government should decide,” Cuomo said while speaking with reporters following Wednesday’s casino cash press conference at the Seneca Events Center inside the Seneca Niagara Casino and Hotel. 

Members of the city council majority have balked at repeated attempts to authorize an agreement that would allow Buffalo-based developer Mark Hamister to build a $25 million hotel and mixed-use building on a plot of city owned land located at 310 Rainbow Blvd.

The trio of lawmakers, including Chairman Glenn Choolokian and his colleagues Sam Fruscione and Robert Anderson, have argued that the city should receive substantially more than the $100,000 Hamister would pay for the land under the terms of the current proposal. They also have questioned the level of transparency and information sharing during the process that led to Hamister’s firm being selected for the project. 

The city council, including all three members of the majority, agreed in February 2012 to designate Hamister as the project’s “preferred developer.” 

In recent weeks, majority members have questioned the “proposed development agreement” as presented to them by representatives from the state-run USA Niagara Development Corp. on July 3. 

On Tuesday, the council majority announced that the entire development proposal has been posted to the city’s website to allow residents to read it for themselves. In a release announcing the posting of the materials, majority members again suggested they were offered “no explanation” about “various clauses” contained in the document.

One area of concern, according to Choolokian, is the lack of language that actually locks the developer into building a hotel on the land. 

“It seems that everyone has a strong opinion on this development package, but almost no one has been able to read it,” Choolokian said.  

“Those pages have holes that a truck can be driven through,” he added. 

Fruscione questioned what he described as “a troubling reverter clause” in the proposed agreement that could “cost the city millions of dollars if we needed to take the land back.” Fruscione also suggested the documents gives “a suspicious amount of power” to Mayor Paul Dyster while “removing the city council from the picture.” 

“It shouldn’t have to always be a constant request for transparency from city government,” Fruscione said. “When Mayor Dyster took office, he pledged to bring a high level of transparency to city hall, but it never seems to go that way. I believe the residents and taxpayers should be able to study this document for themselves.”

On Wednesday, Dyster denied the council majority’s assertion that the process leading up to the selection of the developer and the creation of the proposed development agreement was less than fully transparent. He noted that Corporation Counsel Craig Johnson - who serves both the council and the mayor’s office — was involved in all project talks during the entire process. 

“Anything that is in there they had access to,” Dyster said, referring to the terms of the proposed development agreement. 

Dyster said members of the council majority also are incorrect in their suggestion that he was personally involved in negotiations with Hamister. He said the terms of the development agreement were handled by Johnson, representatives from Hamister and USA Niagara and attorneys from the firm, Jaeckle Fleischmann, who worked on the agreement on the city’s behalf. 

Dyster said the powers granted to him under the agreement are not “suspicious” but rather standard for such deals. He said the reverter clause described by Fruscione as “troubling” is actually intended to protect the city’s interest in the land if, for whatever reason, Hamister is unable to fulfill its end of the bargain. 

Dyster also said should any aspects of the proposal as presented need to be changed for whatever reason in the future, those changes would be required to be authorized by the council itself. 

“Nothing substantial changed about this deal since February,” Dyster said.