|Did Gov. Cuomo save the Maid of the Mist as he claimed?|
Gov. Andrew Cuomo made a campaign tour of Western New York last week, citing his accomplishments in the region.
Among them, he said, “Maid of the Mist was going to leave. Maid of the Mist is stronger than ever before” and “new hotels are rising up out of the ground.”
A little analysis is in order.
The Maid of the Mist boat ride attraction lost over half its business last season because the Niagara Parks Commission (NPC) in Ontario put the contract for the boat concession out to bid.
Maid of the Mist lost to Hornblower Cruises.
The decision by the Niagara Parks Commission to put the boat ride out to bid followed a scandal, exposed by the Niagara Falls Reporter, that revealed that negotiations with Maid of the Mist owner James V. Glynn, took place with certain NPC commissioners to lower his rent in Ontario, while commissioners simultaneously misled Ripley Entertainment about their right to bid.
The scandal resulted in the firing of a dozen Niagara Parks Commission commissioners and management employees.
As a result of the open bidding Hornblower will pay $300 million more to Ontario over the next 30 years than Glynn's secretly negotiated lease which was voided as a result of the reporting in this newspaper.
When Glynn lost the Canadian lease, he lost his winter storage docks, located in Canada, which he used to store his New York boats.
Historically, the New York boat tour lease never went out for bid; the state argued that whoever had the Canadian lease (i.e. Maid of the Mist) had to have the New York lease since it was impossible to build winter docks in New York because of the geography of the Lower Niagara River.
When Glynn lost the Canadian lease, however, Gov. Cuomo, instead of giving the lease to the new Canadian lease holder, Hornblower, suddenly found land for winter docks at the site of the old Schoellkopf Power Plant.
Then Cuomo awarded Glynn a no-bid, 30 year lease at about one third the rent Hornblower was paying in Canada.
Hornblower pays 22 percent of boat tour sales to Ontario. Glynn, under his deal with Cuomo, pays eight percent.
During the time Cuomo was working out a deal with Glynn, Hornblower offered $100 million more to the state than Glynn, but the offer was ignored.
Would Maid of the Mist have left if Cuomo had not decided to waive the open bidding process for boat tours in New York?
Yes, if they lost the bidding.
Would New York have lost boat tours under the falls?
Maid of the Mist would have been replaced by Hornblower or another qualified company.
Is Maid of the Mist stronger than ever?
They lost more than half their business when they lost the Canadian lease.
Still, in New York, they are strong, since Cuomo gave them a lease at 36 percent of market value - market value being established by what Hornblower is paying through competitive bidding in Ontario for the same boat tours.
Since taxpayers subsidize 64 percent of Glynn's rent, it spells greater profits for Glynn's company, making his company stronger, while representing an equal revenue loss for taxpayers of New York State.
The other Cuomo accomplishment was hotels.
In Niagara Falls, he was referring to two taxpayer-subsidized and unbuilt hotels: the Hamister and Wonderfalls hotels.
Wonderfalls, to be built at the site of the Rainbow Mall, announced in time for this year's election season, is years away from groundbreaking, if it is ever built.
It is in preliminary planning stages with funding and the amount of taxpayer subsidies uncertain.
In 2013, developer Mark Hamister was awarded a $2.75 million grant by the state, and given a city--owned parcel of land in downtown Niagara Falls valued at more than $1.5 million for $100,000. What was supposed to have been a first class destination style hotel, with upscale boutiques and permanent residences, has been downgraded twice.
The latest announced downgrade is a 126-room, seven-story Hyatt Place, a midscale business franchise hotel, similar to those found off freeway exit ramps near airports.
The downtown land where the Hamister hotel will be built, if it is ever built, is one of the few, if not the only parcel of undeveloped land in Niagara Falls, N.Y., that, if a high rise were built, could have views of the falls.
The location - just 300 feet from the Niagara Falls State Park - makes the land a natural location for either a high rise or a tourist attraction - the latter which the city needs to keep tourists in town after they visit the falls.
To put in a seven-story, midscale, business hotel is a case of vastly underutilizing the site.
Groundbreaking of the Hamister hotel was originally scheduled for last April, now the developer is talking about next April and has "extension clauses" in his contract that allow him to delay it another year at least.
Making the Maid of the Mist a publicly-subsidized attraction when Hornblower was ready to bid $100 million more is an inexplicable thing to boast as an accomplishment.
And, while one day they may be built, as of press time, hotels are not quite "rising out of the ground."