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"Looks like I'm out of a job," was senior auditor Mary L. Cosoletto's concise reaction Monday after the five City Council members present unanimously denied her request for a waiver of the city's employee residency law.

Mrs. Cosoletto was a city resident until Sept. 6, when she moved to Niagara Falls, Ont. She declined to say why she did that, saying it was personal. "Is my sad story sadder than the mayor's secretary?" she asked, referring to Sharon DeMarco, a Grand Island resident who received a waiver under the 1984 law.

"Circumstances change. The law doesn't allow for that," said Mrs. Cosoletto, who served as the city's payroll supervisor.

She had claimed she should receive the waiver because the city lacks "adequately trained personnel ready to assume my duties."

But her boss, City Controller Peter A. Filocamo, had told the Council, "We do not believe there will be a hardship to the city in finding a replacement for Mrs. Cosoletto."

After the vote, Filocamo said he would meet today with City Administrator Anthony J. Restaino and Corporation Counsel Robert P. Merino Jr. to discuss the matter, but there seemed little doubt as to how the meeting would turn out.

"My understanding is she voluntarily resigned her position when she moved outside the city," Filocamo said. "It's voluntary termination," Merino agreed.

Councilman Vincent R. Morello said, "To me, the issue is not residency but our economic base. . . We have to defend our city." He complained about spotty enforcement of the policy by the last three administrations.

Councilwoman Connie M. Lozinsky said, "I object to employees looking at the residency law as a penalty or punishment. I look at living in the City of Niagara Falls as a privilege."

In another matter, the Council, on a 4-1 vote, awarded preferred developer status to Cataract Sports Entertainment Group, including former Buffalo Sabre Tony McKegney, to study the feasibility of constructing a $1.5 million sports dome on 30 acres of Hyde Park land.

The status means only that the city pledges not to negotiate with anyone else for a similar project at the park until Sept. 1, 1998. No money changes hands, and eventual approval of the project is not assured.

Morello tried to table the matter after Peggy Puglia, co-owner of Niagara's Golf Wonderland in Wheatfield, told the Council that a similar project had been rejected by the city last year. All the members present denied any knowledge of that.

After the meeting, Restaino confirmed that businessman Lawrence DeLong was turned down in early 1996 for an indoor driving range and miniature golf course next to his Portage House restaurant at Portage Road near Falls Street.

DeLong said he had a private meeting with Mayor James C. Galie, then-Council President John G. Accardo, Community Development Director Larry Krizan, Restaino and Merino.

Restaino confirmed, "John was at the meeting and he may well not have said anything (to the other Council members) because it didn't go anywhere." Accardo was out of town Monday. Restaino said, "There were some problems with regard to to location. Parking was a problem. There may have been problems with the financing," although DeLong denied the latter claim. Like the Cataract group, DeLong was not asking for city financial assistance.

Councilman Guy T. Sottile said he recalled a 1992 proposal by a group that included then-Buffalo Bills Shane Conlan and Gale Gilbert to build a $1 million golf practice facility at Hyde Park. He said then-Mayor Jacob A. Palillo "killed it."

In other business Monday, the Council:

Applied for two state parks improvement grants totaling $829,000. They would be used to repair and redevelop Griffon Park, and improve Jayne, 91st Street, and 93rd Street parks. The Council was also briefed by Merino and Environmental Services Director Daniel R. Gagliardo on the Environmental Protection Agency's request that the city build a walkway from the Griffon Park docks to 102nd Street along the Niagara River, past the 102nd Street Landfill.

Gagliardo said the walkway would only be built if the grants were received. He said a $225,000 payment to the city by Olin Corp. and Occidental Chemical Corp., the companies responsible for the toxic landfill, would be used for Griffon Park improvements.

Accepted the Planning Board's report in favor of leasing Hyde Park land for construction of the new Niagara Falls High School. Morello voted no.

Dropped a resolution supporting the use of only U.S. citizens as employees on the American side of the international bridges. Sottile said Allen Gandell, general manager of the Niagara Falls Bridge Commission, assured him that the commission will maintain its long-standing policy of dividing its work force equally between Americans and Canadians.

Approved a resolution asking the administration to develop a historic preservation ordinance for buildings.

Heard Jo Fisher, executive director of the Convention and Visitors Bureau, urge support of the Kayser Beauty Show, returning to Niagara Falls Oct. 18-20 after a six-year absence. She said the cosmetology show's organizers left their Buffalo location to give Niagara Falls "a one-year test."

Approved a contract with E.I. du Pont de Nemours & Co. for reimbursement to the city of up to $145,000 for cleaning of blocked sewers on Buffalo Avenue and 27th Street, and awarded a $134,024 contract for the work to National Vacuum Corp., 4870 Packard Road.

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