<<Home Niagara Falls Reporter Archive>>

NTCC Board Member Challenges Percy on Finances

By Craig Tretiak

John Percy has spent millions of dollars of public money but prefers to keep how he spent it secret.

Tom Callahan does not think much of John Percy, it seems.

Callahan, unlike Percy, has to make his living by actually doing something for tourists. He owns and operates the Lockport Cave Tours. (left)

NTCC Board members are buzzing about the hostile back-and-forth between supporters of embattled CEO John Percy and a renegade board member from Eastern Niagara County at last week's meeting of the tourism agency's board of directors.

The tense meeting resulted from a letter fired off by Niagara Tourism and Convention Corp. Board of Directors member Thomas P. Callahan, who represents the City of Lockport on the board, to Board Chairman Frank Strangio that called the NTCC's current financial problems a "debacle." That letter, a scathing indictment of the NTCC, was also sent to Percy, the NTCC board, Lockport Mayor Michael W. Tucker, Lockport City Attorney John Ottaviano, and a number of other stakeholders.

Callahan, the Lockport tourist attraction operator who helped found the tourism agency more than a decade ago, and formerly held the chairman's post that Strangio now holds, warned that he has grave "concerns about the sustainability and future of [the NTCC]" based on information first reported in this newspaper last month. He also raised questions about business practices, including the failure to purchase required insurance protection, and how much longer the agency would remain solvent absent city bed tax revenues.

Individuals present at last week's meeting indicated that tension in the board room boiled over, with Percy demanding to know if Callahan was advocating for his departure—a question to which Callahan is said to have responded in the affirmative.

After listing a host of concerns, many financial, Callahan's letter demanded, "How has an organization formed with support from every governmental agency in Niagara County [found] itself in such a financial and contractually precarious position?"

Callahan's letter cited Niagara Falls Comptroller Maria Brown's determination, reported in The Reporter's May 14 editions, that "absent a new contract, the city cannot continue to send them a monthly check. … Brown told The Reporter that she has instructed her department to suspend payments to the NTCC effective immediately."

After the Niagara Falls Common Council's majority declined to renew the NTCC's contract, Brown began placing bed tax monies into escrow.

Niagara County's government has yet to take up renewal of the NTCC's 10-year contract either, and deep disagreements between Percy and Tucker over the best expenditure of the Lock City's tourism-promotion dollars are reported have strained that relationship as well.

"There appears to be an obvious adversarial relationship between the leadership of the NTCC and the three founding jurisdictions. I am puzzled that the board seems to be un-fazed by recent reports of funding streams being stopped," Callahan wrote.

Callahan's three-page missive demanded the release of information from the notoriously secretive organization—a sore point for the operator of the Lockport Cave and Underground Boat Ride attraction, who has become a thorn in Percy's side since Tucker appointed him to represent his city's interests at the county-wide tourism organization.

As one of the founding leaders that helped create the tourism agency, few know the NTCC, its history, or its legal obligations better than the flamboyant and tempestuous Callahan. The letter, which cites laws and board rules, includes follow-up on legal concerns he previously brought to NTCC directors' attention in April.

One potent point of contention for Callahan has been the NTCC's apparent direct violation of its own charter, a point hammered home in his letter, following Callahan's verbal objection at the April 4 meeting of the NTCC.

Callahan wrote that at that meeting he "requested information regarding a contractual obligation to the stakeholders. Section 9e [of the NTCC bylaws] requires the NTCC to procure a fidelity bond. The answer I received [at the April 4meeting] was certainly not acceptable."

The bond in question is an insurance policy that protects the assets of a business from losses arising from fraudulent or dishonest acts committed by employees.

One source close to the NTCC told us, "Tom Callahan's a hothead, and he's certainly not making friends in that room, but he had more than a few facts on his side. The failure to meet legal obligations set forth in the bylaws is a huge problem."

That may not be the biggest problem for the NTCC, however, as one question remains publicly unanswered.

"If in fact there will be no funds from the City of Niagara Falls, I would request [Percy] prepare an action plan and a 'burn rate' chart which should be based on the lack of funding from the three jurisdictions [that indicates] what is the timeline before the NTCC runs out of money and can no longer pay their bills, wages and salary, mortgage payments, etc.," the Callahan letter demands.

The ability of the NTCC to respond to that query will likely determine whether the tourism agency, and its free-spending CEO, can continue to operate.



Niagara Falls Reporter - Publisher Frank Parlato Jr. www.niagarafallsreporter.com

JUN 11, 2013