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NFTA shifts course on sale of outer harbor land; Agency revisits idea of public ownership

The Niagara Frontier Transportation Authority is calling "time out" on efforts to sell its outer harbor lands to private developers, renewing instead an old game plan that centers on continued public ownership.

Commissioners of an NFTA committee overseeing the vast waterfront properties voted Thursday to suspend its negotiations with the Bear Development group -- a major step backward from its almost year-old effort to exit the land development business.

Although commissioners and staff say all options remain on the table, Commissioner Howard A. Zemsky -- expected to soon be confirmed by the State Senate as the new NFTA chairman -- made it clear the preferred alternative is for some public entity to guide future development.

"By virtue of the fact that we have suspended our conversations with a private entity, that speaks for itself," Zemsky said. "It is an amazing asset for the public. And if we are going to treat it that way, it ought to be run by a public entity."

The move, expected to be ratified on Monday by the full board of commissioners, signals at least a temporary end to ongoing negotiations with Bear Development and its owner, David Pfeiffer. The authority in February designated Bear as preferred developer of the Small Boat Harbor and Gallagher Beach, after announcing last summer it wanted to concentrate on its core transportation business and not waterfront real estate development.

Only two proposals were submitted at the time, with the other coming from Smith Boys Inc. of North Tonawanda. The authority voted to accept the Bear offer to pay $3 million for the two parcels, commit to $15.3 million in improvements, and maintain public access.

Pfeiffer offered no comment Thursday on the latest development, but indicated earlier this month that NFTA demands regarding responsibility for environmental cleanup at the marina portion of the property made his plans economically unfeasible.

He also said he had spent almost $150,000 on plans that included dredging the harbor, rebuilding the break wall, building new docks, constructing interior parks throughout the property, building an amphitheater between the harbor and beach, and expanding Dug's Dive restaurant.

The authority began to back away from the deal after Pfeiffer publicly complained about its terms. On Thursday, Commissioner Peter G. Demakos, chairman of the Property and Risk Management Committee, said the authority is now open to any new suggestion. But he also said the concept of public ownership -- with others suggesting the possibility of private leasing opportunities -- would "ideally" prove the best route.

"It ensures access to a great public asset," he said. "We want to make sure the resolution of this continues to serve the public.

"[Land development] is not our core mission," he added. "It is planes, trains and buses and serving the public with the most reliable public transit system we can."

Zemsky added that the authority was encountering difficulty in guaranteeing public access to land in private hands.

"It's really hard to sell something yet truly guarantee public access," he said.

Demakos emphasized that the NFTA remains committed to operating its marina at the Small Boat Harbor through this summer, and that normal activities can be expected. But he also said new options should be explored, especially after "feedback" received by the authority over its plan to sell the outer harbor.

Demakos and Zemsky both said they favor a single entity overseeing development of all waterfront land in Buffalo, and continued to suggest the Erie Canal Harbor Development Corp. Authority officials also pointed to a 2006 memorandum of understanding that authorized negotiations for takeover of the land with the harbor corporation, but which was never acted upon.

Sam Hoyt, interim harbor agency chairman, said Thursday that his agency has had no further discussions with the NFTA or anyone else about assuming ownership of the outer harbor. But he reiterated his interest.

"We remain more than happy to participate in discussions with the NFTA about possible acquisition of the outer harbor property," he said. "Whenever they want to have that discussion, we're ready to engage."

Hoyt said the idea makes sense as the transit authority looks to concentrate on transit and the economic development agency remains charged with developing the waterfront.

"It's natural," he said, "that we have this discussion."

Assemblyman Sean M. Ryan, D-Buffalo, a frequent NFTA critic, said late Thursday that he was pleased by the authority's change of course and noted that he considered both private proposals "not that appealing."

"This gives us a nice opportunity for breathing room and to come up with an inner harbor and outer harbor plan for development from Erie Basin Marina all the way to the Bethlehem Steel site," he said. "This land should be held by a public authority, so that we make sure we make public use first and foremost.

"This is good leadership on the part of the NFTA," he added.