Niagara Gazette

Local News

February 22, 2012

End of an era for Maid of the Mist - Hornblower awarded contract

NIAGARA FALLS, Ont. — Hornblower Canada Co. will replace Maid of the Mist as the boat-tour operator at the base of the falls.

The Niagara Parks Commission in Canada announced Wednesday Hornblower, whose American parent operation runs boat tours to the Statue of Liberty in New York and Alcatraz in San Francisco, was selected for a 30-year lease worth more than $500 million.

“This marks the beginning of a new era for all of us and it continues to build on what Niagara, and Niagara Parks, is all about,” said parks commission chairwoman Janice Thomson.

Thomson, along with an independent procurement adviser and fairness commissioner, said the process to pick a company to run boat tours was fair and impartial.

The announcement settled questions about the future of the Maid of the Mist Steamboat Co., which has provided tours from the Canadian side of the river since 1846.

Since 2009, the NPC has been going through a competitive bidding process after there were complaints from private-sector companies when the commission tried to extend its contract with the Maid of the Mist without a tender.

Thomson said six bids were received — three from Canadian firms and three from American companies. She did not disclose them. She said Hornblower’s plan “excels” the current operation when it comes to “marketing, its vision for an extended service with more family-oriented activities, (and) fully accessible access to the boats.”

Two passenger boats carrying 599 passengers and one rescue boat will be supplied by the new firm.

Thomson said Hornblower will initially invest more than $16 million to upgrade passenger facilities and construct new tour boats. The new service is expected to start in spring 2014.

Maid of the Mist, which has a month-to-month lease, can continue operating for the 2012 and 2013 season.

When asked if the American Maid of the Mist Co. will be able to continue storing its boats on parks land, Thomson said: “This (Request for Proposal) process that we were dealing with deals strictly with the operation on the Canadian side, and we are dealing with the lease of that Canadian land to the operator. We have no involvement at all with what happens on the other side.

“We will have leased that land to Hornblower as it currently stands.”

A statement released Wednesday afternoon by the New York State Office of Parks, Recreation and Historic Preservation says the American state park will “explore all options” related to the Maid’s future.

“Presently, we have a valid contract with the Maid of the Mist to provide boat tours at Niagara Falls State Park ... it is premature to speculate about the future at this early date,” the release states.

Niagara Falls, N.Y. Mayor Paul Dyster issued a release stating “The Niagara Parks Commission and the new contract winner must work quickly with Maid of the Mist to hammer out a fair agreement to allow access to critical infrastructure so world class tours can continue without interruption from the American side of the Falls.”

Dyster told reporters, “this was the situation we had hoped to avoid.”

“Our interest is in making certain that there is an attraction available to tourists on the U.S. side and we are going to try to pursue that. The first thing we are going to do is try to coordinate with our federal and state representatives, including state parks,”

Under the Canadian lease with Hornblower, the parks commission will receive a guaranteed payment of more than $60 million during the first five years. She said the revenue the parks commission will receive beyond those first five years depends on attendance.

Revenue was not the only factor, or even the most important one, in the decision to go with Hornblower, said Thomson, which was approved by provincial cabinet Wednesday.

“We also looked at what the proponents planned to do to enhance the experience of visitors to the park. We reviewed the proposed pricing structure to ensure that the experience remained affordable and accessible to families who are visiting Niagara Falls. We looked at how this signature attraction was going to be promoted to bring more visitors into the parks to experience the wonder of Niagara Falls.”

She said the fee structure still has to be worked out, but that whatever Hornblower comes up with, it will need to be approved by the commission. A name has also yet to be decided upon.

Hornblower’s parent company is based in San Francisco and has more than 30 years of experience operating in waters around the world, said Thomson. It also operates the ferries to Alcatraz Island in San Francisco Bay, and ferries to the Statue of Liberty National Monument and Ellis Island Immigration Museum in New York Harbor.

According to Hornblower’s website, the company plans to hire “talented and experienced members of the Niagara Falls and Ontario community.”

Tim Parker, general manager of Ripley Entertainment, which at one time expressed interest in participating in a bidding process, wouldn’t confirm or deny whether the company was one of the six bidders, citing a “confidentiality agreement.” When asked why he attended the announcement, Parker said: “This is about Niagara Parks and about Niagara Falls. We’ve operated here since 1962, so we wanted to make sure that going forward who is going to be our next big attraction. It sounds like it’s going to be a dynamite attraction. It’s sounds very interesting. I’ll be more interested to see how it unfolds, and see exactly what it’s going to look like.”

Thomson said the commission and province spent $2 million combined on legal fees and hiring advisers.

Bill Mocsan, who was hired by the province to oversee the procurement process, said it was “probably the most thorough, detailed procurement I’ve ever seen, or I’ve ever been involved in.

“I think the bid that was submitted by Hornblower was the best bid,” he said. “It was thorough. It was innovative. Not the appearance of it, so much as the content.”

Howard Grant, who was hired by Ontario to oversee the process leading up to the bidding stage, said the province and parks commission followed through on its commitment to be open and fair.

“Clearly they wanted a competition, they felt it could be a good competition, at the same time respect the fact there was an incumbent who’d been offering very good service, the Maid of the Mist,” he said.

“My role was to make sure that it was fair to all people who wanted to respond to the request for proposal. I met with the bidders on a regular basis. They had access to me if they felt there were things that were unfair. And as a consequence, when the RFP process closed, every bidder was comfortable they’d been given enough time to put a good proposal in.”

MPP Kim Craitor said he is ecstatic with how the process unfolded, and is impressed by the projected revenue figures.

“I always thought, how do you sign a 30-year lease without going through an RFP process first?” he said. “I pushed for this process to happen, as did others, and in a way I feel vindicated.”

Niagara Gazette reporter Mark Scheer also contributed to this report

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