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FALLS HOPES TO FUND SPLASH PARK OPERATION IN 1997 BUDGET

About $625,000 would be needed to operate the Niagara Splash water park next year, a consultant to the city said this week, and the city administration has stated it wants to place funds to operate the park in the city's 1997 budget.

Michael J. Skowronski, a consultant hired by the city to oversee operation of the park this year, reported to the City Council that the park lost $26,759, in addition to the $250,000 advanced by the city's Urban Renewal Agency. Total operating costs this year were $627,885, Skowronski said.

Attendance of 43,189 this year was down from 55,583 in 1995 and from the nine-year average of 44,449 since the park opened, Skowronski said. Weather was blamed for the decrease. Although, the weather was pleasant, the "sultry, hot, humid conditions which prevailed last year" were absent.

"It appears that these conditions are needed to entice people into the park," Skowronski said.

Despite a late start and an inability to zero in on the proper target markets early in the season, group sales revenue increased to $50,006 -- more than in the previous two years -- Skowronski said. He estimated next year group sales could generate $65,000. He said $40,000 would be needed for sales and marketing, and promotion should start in January.

Mayor James C. Galie's administration agrees. The city faces an anticipated 1997 shortfall calculated at $7.2 million and a resulting need to make cutbacks and raise taxes, an ailing infrastructure, and possible privatization of garbage pickup and the water and sewage treatment plants, but the administration believes an operating splash park is important for the city.

Galie and City Administrator Anthony J. Restaino have said they plan to place funds for the operation of the park in the 1997 budget, although Restaino said this week that would have to be re-examined in light of the rising budget gap.

While he did not specify the amount, Restaino said he would place funds to operate the park in a separate, designated fund. Appropriating the funds in the city budget would eliminate the last-minute decision-making on opening the park that has occurred for the past several years. Securing the funds also would allow a year-round marketing effort, which officials believe would produce higher revenues.

Council Members Ralph F. Aversa and Vincent R. Morello have opposed using public funds to operate a facility the city does not own. Morello favors selling the park for some other use, saying the land at Rainbow Boulevard and Quay Street that the park sits on is worth more than the park and that the attraction should be demolished.

Galie has said that until a buyer comes along, he wants to keep the park open.

"I don't want to see another closed attraction in Niagara Falls. Even though there's a cost to it, sometimes we have to bear the costs. Even in the long run, if a buyer comes along, I'd like to see it remain a splash park. It's good for the community," Galie said last month.

One potential buyer has come along. The Alliance Foundation of Western New York, a McLean, Va., based non-profit agency that has applied for $22 million in tax-free bonds to buy the park.

The Niagara County Industrial Development Agency's bond counsel is awaiting data from the foundation's California-based parent company to determine if the company is eligible for the tax-exempt status. Leo J. Nowak, executive director of the development agency, said as of this week bond counsel had not received the required information.

Meanwhile, the city's 4-year-old foreclosure against the park seems stalled again. The city won a judgment to foreclose in April. But to date, the city and Niagara Venture, the developer of the park, have not agreed on terms of the foreclosure order, Corporation Counsel Robert P. Merino said.

One of the disagreements is whether to proceed to a foreclosure sale or a hearing on the interests of the creditors, Merino said. The city has claimed the park owes it up to $14 million for unpaid loans, water and sewer charges. But, Merino said, the city's position has been that it would accept $7.5 million -- the amount it would receive under the Alliance Foundation's proposal. The plan is similar to several others that have been proposed -- but never consummated -- over the years.

In May, Merino predicted there would be a foreclosure sale of the park in two to six months. A sale could be stopped by an appeal by Niagara Venture. No one knows how much the park would bring in a foreclosure sale, but generally properties are sold at such sales for less than their market value.

"I think we'd be hard-pressed to get $7.5 million in a foreclosure sale," Merino said, indicating the city would gain more from the Alliance Foundation sale.

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