NIAGARA FALLS – The City Council majority on Monday released its chokehold on a $25.3 million downtown development project.
Councilman Robert A. Anderson Jr. defected on the issue from his colleagues in the three-member majority and voted with the two existing supporters to approve a deal with the Hamister Group for a five-story hotel, apartment and retail project on Rainbow Boulevard.
The three-member majority, which also included Chairman Glenn A. Choolokian and Councilman Samuel F. Fruscione, had put off a vote on the deal in early July and refused to allow a vote later that month.
Daniel Hamister, senior vice president of business development for the Hamister Group, said the next step is to finalize a development agreement for the project. He said he expects it to be completed in the “next couple weeks.”
“For us, actually for everybody, I think it’s a good thing,” Hamister said after Monday’s Council meeting. “Not only do we get the project that we’ve been negotiating for the past 18 months, but Niagara Falls gets a beginning of what I would call the opportunity for a redevelopment and revitalization of Niagara Falls.”
Some supporters of the project have hailed it as the first non-casino development of this size in the Falls in more than 40 years.
Anderson joined Councilwoman Kristen M. Grandinetti and Councilman Charles A. Walker in voting in favor of a measure that allows the city to sell the land at 310 Rainbow Blvd. and also allows Mayor Paul A. Dyster to sign a development agreement with the Hamister Group.
Anderson, who had voted twice with the majority to table the agreement, said the project may help give the city a chance “to come back.”
“But you have to start someplace,” Anderson said, “and this could possibly be a great beginning for us.”
Anderson announced his support for the project Monday morning during a news conference with Sam Hoyt, regional president of Empire State Development Corp.
Anderson said he got assurances about his three main concerns through talks with Hoyt, which included a face-to-face meeting at Anderson’s house on Friday. Those assurances are:
• The Hamister Group will, to the greatest extent possible, try to employ local workers on the construction job.
• The city will obtain a performance bond that protects the city in case the project is not completed by Hamister.
• In the event the land comes back to city control, through the function of a clause in a development agreement known as a “reverter clause,” any of the money Hamister borrowed to fund construction of the project that he does not pay back will not be a liability to the city because it will be covered by the performance bond.
At the news conference, Anderson said he had not spoken with his colleagues in the majority in three to five days.
The documentation approved Monday by the Council was the same paperwork it had first tabled July 8, and included a list of 17 items that outline what is to be negotiated in the development agreement. The term sheet already made reference to the requirement of a performance bond for the project.
Dyster said the discussion between Hoyt and Anderson allowed for “an opportunity to clarify and amplify what was already on the term sheet.”
Choolokian and Fruscione voted against the proposal.
Choolokian said he would have preferred to see something in writing documenting the assurances made to Anderson.
“I can’t vote on something I don’t really feel comfortable with,” Choolokian said. “I was elected to represent the taxpayers. I do believe this project is not in the best interest of Niagara Falls on the whole. ... I wish Mr. Hamister all the luck in the world. I hope this project is successful. I hope I’m dead wrong, and I hope this is something that’s going to continue on,” Choolokian said.
Fruscione did not offer any explanation when casting his vote.
The Council voted to take the proposal off the table during its 5 p.m. meeting, prior to the regular business meeting which followed at 6.
All five lawmakers voted to take the item from the table, including Fruscione and Choolokian.
When asked why they would change their position and vote to allow the item to come up for a later vote, Fruscione told a reporter he’s “not wasting his [expletive] time” answering that question.
Fruscione, who finished fourth in last week’s City Council primary for three spots on the Democratic Party line in the November election, was supported on an anonymous political mailer that was sent to Democrats in the Falls earlier this month that also attacked Hamister Group Chairman and Chief Executive Officer Mark Hamister. The flier accused Hamister of “running a con game” on the Falls with this project and caused Hamister to nearly walk away from the project.
Fruscione blamed his loss in the primary partly on “character assassination on [his] ethnicity.”
Hoyt, who also had meetings with Choolokian and Fruscione about the project, blamed himself for not reaching out to Anderson earlier.
Hoyt, who said he had never met Anderson before a few days ago, said he mistakenly viewed the Council majority as a voting bloc.
“There were communications with other members of the Council, but I never spoke directly to Mr. Anderson and that was my mistake.”
Dyster called Hoyt’s discussions with Anderson, as well as Gov. Andrew M. Cuomo reaching out to Mark Hamister to keep him from withdrawing his proposal, as examples of how effective personal diplomacy can be.
But does this ordeal surrounding the project cast say something to other developers who may be interested in the Falls?
“I think at the end of the day, we got it done,” Dyster said, “and I also am hopeful that we’ve reached the tipping point, not just in terms of the substance, but in terms of the process.”
Dyster said one lesson from this situation may be applied to another proposed development project downtown – the city has asked two developers to submit proposals for the former Rainbow Centre mall. Dyster said it may be helpful to offer a briefing to Council members at this stage of the process.
“Council members have to accept those invitations,” Dyster said. “That’s, I think, a key part.”