Niagara Falls Redevelopment (NFR) and the City of Niagara Falls clashed in New York State Appellate Court in Rochester today as NFR seeks to end the city’s attempt to take their private property through eminent domain.
Mayor Robert Restaino’s fanciful vision for NFR’s land, dubbed “Centennial Park,” drew skepticism from the four-judge panel of the Appellate Division court, with judges wondering aloud whether the city’s hastily conceived land grab constitutes prudent fiscal policy.
As today’s courtroom spectacle unfolded, NFR attorney John Horn argued that the city’s “Determination and Findings” failed to fulfill the essential requirement of serving a genuine “public purpose,” as New York State eminent domain law mandates.
Horn dissected Mayor Restaino’s grand vision, revealing a lack of substance with his ever-shifting land sizes, frequently amended documents, and a conspicuous absence of funding and feasibility studies for the proposed park and events center.
One of the judges remarked it sounded like the city “is gonna go around with a tin cup to the state and the federal government” in an attempt to find the money to build Centennial Park.
Horn went through a litany of flaws in the mayor’s plan, contending it contradicted the 2009 Comprehensive Plan adopted by Niagara Falls which requires a land site study, feasibility study and long-term partnership with NFR, which precludes taking the land from the company.
Outside attorneys from Hodgson Russ LLP of Buffalo, hired by the City of Niagara Falls, relied on technical definitions to overcome uncertain funding plans. The City’s attorney argued that the NFR property, current in taxes and indisputably well maintained, is nevertheless “blighted” because it is vacant and therefore “underutilized.”
Such an argument, if accepted by the court, makes any vacant land or farm field potentially susceptible to a “blight” designation as justification for a government seizure in New York State.
NFR disputed the blight claim, emphasizing the pristine condition of the parklike land, which has never incurred any violations or delinquencies.
Horn told the judges that Mayor Restaino manufactured the allegation of blight to justify his single-minded, near fanatic pursuit of the property.
As the proceedings continued, Horn revealed a mayor who was hurried and ill-considered, “virtually building his plane in mid-air, with no idea where it’s headed.” The latest evidence? The mayor called a special meeting of the City Council on May 18 to try to get funding for a feasibility study.
This request came almost a year after the mayor initiated the eminent domain proceedings, plunging the city into spending millions, before knowing if the project was economically feasible.
Horn further challenged Mayor Restaino’s intentions by highlighting the city’s refusal to consider a less costly and better-situated city-owned land for the events center, sparing taxpayers the need to fight to take the land, and the mayor’s outright rejection of NFR’s offer to donate alternate land for a park.
These rejected, less costly alternatives underscore the question of why the Mayor is fixated on NFR’s land.
Adding to the mystery is Mayor Restaino’s abrupt change of course on the land in late 2021.
Restaino initially agreed to work with NFR and Toronto developer Urbacon on a groundbreaking $1.5 billion Niagara Digital Campus project, which promised to bring hundreds of permanent jobs and cutting-edge opportunities to the city.
Then Mayor Restaino unilaterally abandoned support. He pushed through a data center moratorium in late December, pivoted to an eminent domain proceeding to take the property the next month, and then brazenly told the media that NFR came up with their Digital Campus plans after he said he wanted to take the land for Centennial Park.
Planning department records show the mayor is being untruthful; the record is clear. NFR’s plan came in September 2021, and the mayor did not announce his plans to take their land until early 2022, showing the mayor is not averse to virtually saying anything in his single-minded quest to take NFR’s land.
Meanwhile, the outcome of this legal battle will cost others dearly. Even if Niagara Falls prevails in the current legal round, the appeals process could extend over years. In the event of a victory, the city will be required to compensate NFR at full market value, potentially amounting to a staggering $20 million.
Adding to the skepticism surrounding cost is the absence of a confirmed anchor tenant for the proposed events center. Reports indicate it will cost taxpayers more than $500,000 per year in operating losses with a tenant, and possibly twice the amount if the city fails to attract a suitable anchor tenant for the proposed events center.
These high costs, plus a probable cost to city taxpayers of millions more in legal fees, pose a significant financial burden for a city grappling with limited resources.
How much in legal is anybody’s guess. Mayor Restaino has yet to disclose the amount he caused the city to spend on legal fees for the eminent domain case.
In contrast, the Niagara Digital Campus plan, supported by NFR and Toronto developer Urbacon, is a nearly $1.5 billion project that is estimated to create over 5,600 construction jobs and provide more than 550 permanent positions, injecting an estimated $250 million annually into the city’s economy.
The project would create thousands of jobs, and generate significant economic benefits for the city, and add to the city’s resources by paying property taxes.
Instead of working diligently with a willing partner in NFR, the Mayor is content to let the ultimate decision rest in the hands of the courts, as NFR’s petition to annul the City of Niagara Falls’ eminent domain action awaits a ruling expected in the fall of 2023.