Guido payoff to enable Hamister just more tax money squandered  

 

Why was parking lot operator John Guido paid $45,000 in public money last July to vacate the Rainbow Boulevard North property he leased from the city so that Buffalo developer Mark Hamister could begin construction of his proposed hotel?

While at least five other hotels have been built in the city since the Hamister project was announced, the former parking lot remains vacant.

Last June, the city sent a letter to Guido stating that he needed to vacate the property as per his 2009 lease agreement, which was modified in 2011.

Under the terms of his agreement, Guido had to leave once a building permit was issued for the hotel project and one had been, the letter said. Guido needed to be out by July 27.

Guido promptly sued, on Friday, July 24 and, by the following Monday, July 27, the case had been settled. Try going through the past century’s worth of city litigation to find a single case that has been resolved as quickly. You won’t.

Under the terms of the settlement, Guido received a $45,000 payment, which Dyster referred to, in an interview with the Buffalo News, as a “good will payment.”

Good will for what, many wondered. Guido’s lease was set to terminate on August 1 in any event, and Hamister certainly wouldn’t begin actual construction prior to closing.

At the time, Guido’s attorney, Kevin A. Szanyi, said that if the Hamister closing did not take place by September 30, the lease with his client goes back into effect.

“We want it to get off to a clean start, with good will among all parties,” Dyster said of the quick timing.

Immediately, city crews were dispatched to the site to tear down a trailer Guido used to house a small restaurant, along with a nearby shed, and grade the lot – at taxpayer expense.

Hamister, who has never built a hotel before, originally painted a lavish picture of the “resort destination” he planned to build on the choice real estate, which lies about 300 feet from the main entrance to the Niagara Falls State Park.

A news release issued in 2013 described a 100,000-square-foot establishment with 100 plus upscale rooms and 24 trendy permanent apartments. On the ground floor, 8,000 feet would be devoted high end boutiques for the discerning shopper.

The project would create between 200 and 300 jobs during the construction phase, and catering to the needs of the moneyed patrons who would flock to the premier destination would require the services of 70 full time employees once construction was completed.

Of course, only one hotel chain could provide the necessary opulence to make this all come true, so Hamister announced that Hilton Hotels & Resorts had been brought on board to partner in the venture, lending the most prestigious name in worldwide hospitality to the venture.

The hotel project would be “transformational,” a once in a lifetime opportunity that would provide the “tipping point” that would once and forever serve to revitalize the city’s languishing tourist district, Dyster gushed.

But when Hamister finally had to submit papers to the county Industrial Development Authority to apply for millions in tax breaks, he admitted that there would be no upscale residential apartments, no trendy boutiques and that the hotel wouldn’t be a Hilton at all, but a mid-scale, 128-room Hyatt Place – indistinguishable from those found near truck stops in Nebraska and Arkansas – instead.

Rather than 70 full time jobs, just six fulltime and about 39 part time jobs were listed on the developer’s IDA application, which is sworn to under penalty of perjury.

Early estimates set the price tag of the project at $22.4 million, a figure that has since ballooned to $35.7 million despite the numerous downgrades in the scope of what was being built.

Under the terms of his agreement with the state, Hamister will receive $1 in state aid for every $9 he sinks into the project. 

Hamister has been inflating the cost, perhaps to be able to get more taxpayer subsidy money.

Construction was originally slated to begin in the spring of 2014. It didn’t, and the developer announced that it would get underway that summer. Summer came and went and a spring, 2015, groundbreaking was announced. A building permit was issued that summer, at the time of the payoff to Guido, but no groundbreaking took place.

Critics have charged that the actual cost of the hotel will be around $18 million, since a nearly identical Hyatt Place was built in Amherst last year for that amount.

Just last week, Canadian hotel developer Michael DiCienzo reiterated his offer to take over the Niagara Falls project and deliver the hotel for $18 million.

Last year’s payoff to Guido wasn’t the first time the Dyster administration has acted quickly because construction of the hotel was said to be imminent. Back in the autumn of 2013, former city councilman Sam Fruscione was demonized in the press for simply asking whether or not Hamister actually had the money to do what he said he was going to do.

Fruscione was running for reelection and a campaign of robo-calls and mailings was launched against him by Dyster operatives calling him an obstructionist who was personally responsible for the lack of development in the city.

The voting public bought into it, and Fruscione went down to defeat.

Now nearly three years later, it looks like he was right. If Hamister had the money to begin construction, there is no reason whatsoever for him not to have.

Last week, the mayor finally admitted as much.

“Along with developers, we’re waiting to hear back on the completion of arrangements on financing,” Dyster said. “We’re all anxiously waiting to hear about the conclusion of this process.”

How is it that Fruscione – along with former councilmen Bob Anderson and Glenn Choolokian, along with the entire editorial department of this newspaper – strongly suspected Hamister didn’t have the money three years ago and Dyster, who remains closer to the developer than anyone in the city, seemed oblivious to the fact until just last week?

Why was $45,000 in state taxpayer money squandered to pay off Guido, when there is no reason he couldn’t still be operating on the property today?

And did this have anything to do with the fact that the payoff happened to be precisely during reelection time and by clearing Guido off the lot and cleaning it up with taxpayer money, Dyster made it appear as if the Hamister deal was really going to happen.

In other words, Dyster used taxpayer money to assist his reelection, knowing full well that Hamister did not have the funding.

IMG_1801 250 - Copy

The site of the proposed Hamister hotel was a parking lot operated by John and Debbie Guido. Mayor Dyster paid them $45,000 [state taxpayer money] to move out before the primary since he said Hamister was ready to go. Why did taxpayers foot the bill? Why couldn’t the Guido’s continue to operate the lot?

newNiagara

The New Niagara is very much like the old Niagara. When will Hamister who inked the deal to build a hotel in 2013 actually either admit he does not have the funding or start building his hotel?

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