The Niagara County Legislature Tuesday night, by a 14-5 vote, approved a plan to issue up to $20 million in tax-exempt bonds that would allow a non-profit youth organization to buy the Niagara Splash water park in Niagara Falls.
The Legislature's vote followed a similar action earlier Tuesday by the county Industrial Development Agency.
Agency officials said the bonding is contingent on the buyers, the National Organization for Youth Recognition, an Initiate of the Chiefs of Police National Drug Task Force Inc. of Washington, D.C., and the developers, Niagara Venture, arranging private financing.
It also is contingent on full payment of a total of $15.7 million owed to the City of Niagara Falls, the city School Board and the IDA in connection with construction of the park and other projects.
IDA Executive Director Leo J. Nowak said the $15.7 million included:
$1.7 million owed the city and school district under in-lieu-of tax programs, including payments on the Inn at the Falls.
$9.7 million owed the city for federal loans.
$4.2 million used for developing the Falls Street Faire and Falls Street Station, and $100,000 owed the development agency in connection with building inspections at the two projects.
Although the water park, which cost $17.8 million to develop, is reportedly being sold at a loss, the revenue from the sale will permit the developers to pay off government loans, overdue water and sewer bills, and other bills owed to local governments in lieu of taxes.
Legislator Richard M. Shanley, D-Lockport, said the county was basically "bailing out" Niagara Venture principals John P. Bartolomei, a Niagara Falls lawyer, and Edward U. Bevilacqua of San Diego, Calif. But most legislators saw the action as taking a burden off the taxpayer.
"In essence, it is transferring a public debt and putting it with a private organization," said Steven H. Brown, R-Niagara Falls.
The Washington-based non-profit youth agency will receive a 50 percent tax abatement in the first year, which will be reduced to zero in 10 years, said Nowak.
IDA bond counsel Steven Waterman objected to comments made by Legislator H. William Feder, R-Niagara Falls, who said the Legislature was being kept in the dark on specifics about the purchaser and exactly how the agreement would benefit the City of Niagara Falls and other creditors.
After Feder twice said the organizations assets were about $20,000, Waterman responded that its assets were about $300,000, which, he conceded, was not a "tremendous amount."
According to the Legislature resolution for approval, the sale will maintain the 10 full-time jobs and 120 part-time positions and will create another 40 jobs, only 10 of them full time.
Some of the proceeds, not detailed fully at the session, also will be used to "cure defaults" associated with development of the still-unfinished Falls Street Faire and Falls Street Station projects in Niagara Falls by Niagara Venture.