January 6, 2023

• The petition to annul the determination and findings of the City of Niagara Falls will be heard by the New York State Supreme Court, Appellate Division.
• The petition argues that the determination and findings were procedurally defective, do not serve a public purpose, and constitute an “excess taking” under the law—particularly when the City failed to consider multiple alternative sites for the project it claims to want to build and rejected NFR’s offer to bring a state-of-the-art, $1.48 billion data center to Niagara Falls on NFR’s own property.
• Based on prior valuations, the petition estimates that the cost of acquiring the NFR parcel will be in excess of $11 million – money the city doesn’t have.

Summary

On January 6, 2023, Niagara Falls Redevelopment (NFR) petitioned the New York State Supreme Court, Appellate Division to annul the determination and findings underlying an attempt by the City of Niagara Falls to take, under New York State’s eminent domain statute, property owned by NFR.

The petition points out that, based on a 12-year-old judicial determination regarding similar properties in Niagara Falls, the acquisition costs of the allegedly illegal taking would likely exceed $11 million – with legal fees for the proceedings costing millions more.

According to the petition, months before the City disclosed to NFR its intention to begin the eminent domain process, Mayor Restaino and numerous officials met with NFR representatives about a proposed $1.48 billion Niagara Digital Campus project that would create approximately 5,600 construction jobs and more than 550 permanent jobs—which, it is estimated would bring about $250 million annually in economic benefit to the city. NFR continued to work with the city for several months, until Mayor Restaino indicated for the first time in January 2022 that the city had decided unilaterally to instead take NFR’s property through eminent domain for an unfunded and speculative park and events center called “Centennial Park.”

According to a recent op-ed in the Niagara Gazette, there are far better locations for the Mayor’s events center: closer to existing parking and Third Street hospitality businesses, hotels and other commercial locations. It is estimated that the savings achieved by not having to build a new parking garage alone could exceed $35 million.

NFR Offers to Donate Land, Provide $2.5 million for Upkeep

Despite this, city officials refused to even make an attempt at finding a way to work with NFR and its partner, Urbacon, to build the data center on NFR’s property on John B. Daly Boulevard. They instead proposed using taxpayers’ money for a poorly thought-out plan without any specifics. In contrast to the Mayor’s vague and unsupported proposal, NFR has outlined a thorough plan and outlook for their project, which includes economic benefits, educational opportunities and scholarships, and enhanced broadband access for Niagara Falls residents.

Key to NFR’s proposal is the donation of an estimated 10.9 acres of land for a park—closer to the residents who would use it—at no cost to the city. NFR has also pledged $250,000 per year for ten years,or $2.5 million, for maintenance and upkeep if the City will simply permit NFR to use its own property to build the data center. Significantly, 100% of the proposed land to be donated is owned by NFR, so the city would incur no land acquisition costs.

Urbacon’s Plea

Urbacon has successfully built and is currently operating similar facilities in Toronto, Richmond Hill and Montreal.

At a public hearing in June, an Urbacon representative stated that, while the company is committed to Niagara Falls, Urbacon cannot wait forever. The Urbacon representative urged the City to work with Urbacon and NFR to find a solution that would bring jobs and opportunity to Niagara Falls.

A copy of the court filing, with exhibits, can be found here.