Council to vote on new corporation

By Kim DeGeorge

WGRZ
NIAGARA FALLS, N.Y. — The Niagara Falls City Council is expected to consider creating a non-for-profit local development corporation (LDC) at its July 8 meeting to oversee the financing, construction and operation of a proposed entertainment and sports complex on city-owned land.

Officials say creating a nonprofit local development corporation would give the city more flexibility to develop and manage a large project than if it handled the work directly.

“This is a proven structure for delivering a major public facility, and it is the right approach for Niagara Falls,” said Mayor Robert Restaino. “An LDC gives us a dedicated, purpose-built organization with the legal authority to access tax-exempt financing, pursue grants, negotiate the complex development and operating agreements a project like this requires, and deliver a world-class arena and events center for our residents and visitors. It also provides a structure to protect the City against financial exposure related to the project.”

According to city officials, some of the advantages include:

• Tax-exempt bond financing. An LDC can issue tax-exempt bonds to finance construction, providing access to long-term, lower-cost capital. LDC bond obligations are not a debt of the City and do not require a pledge of the City’s credit or taxing power.
• Tax exemption on operations. The income and operations of an LDC are exempt from State taxation under the Not-for-Profit Corporation Law, allowing project revenues to be reinvested directly in the facility and its mission.
• Grant eligibility and revenue flexibility. An LDC can apply for federal and State grant funding and enter into complex concession, management, naming-rights, and sponsorship agreements that generate additional revenue streams for the project.
• Dedicated project governance. The LDC’s Board of Directors is focused exclusively on the success of the entertainment and sports complex, allowing for the specialized expertise and operational agility that a major public venue requires.
• Economic development and jobs. Development of the facility through an LDC is expected to generate significant construction employment, permanent facility employment, and broad economic activity in the tourism, hospitality, and retail sectors across the City and the region.
• Full public accountability. As a public body under New York law, the LDC is subject to the Open Meetings Law, the Freedom of Information Law, mandatory annual independent audits, annual financial reporting to the City Council, and oversight by the New York State Authorities Budget Office and the State Comptroller.

“Authorization by the Council is a critical first step towards the City finally taking control of our own destiny in building a world-class venue to enhance our status as a national and international destination,” Mayor Restaino said. “The LDC structure means we can move forward with a dedicated organization focused entirely on making this project a success – one that will create jobs, attract visitors, and generate economic activity for generations to come.”

The proposed local development corporation would be overseen by a five-member board led by the mayor, with appointments split between the mayor and the City Council.