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NTCC needs to be put to bed: Bed taxes going to do-little organization

January 13, 2009

By Frank Parlato Jr.

Frank Parlato Jr.

Some people think it is a government agency.
But the secretive Niagara Tourism and Convention Corporation (NTCC) is a private corporation hiding behind its not-for-profit designation. It’s time it was exposed.

NTCC documents:

Under a contract with the cities of Niagara Falls and Lockport and Niagara County, most of the bed (or hotel) taxes generated here — about $1.2 million annually — are paid to the NTCC. About $1 million comes from Niagara Falls hotels. In addition, the NTCC gets around $1 million annually of the city’s share of the Seneca casino money.
In return, the NTCC is supposed to promote the county “as a premier destination for meetings, conventions and leisure tourism.”
How well its does this is open to question. It refuses to give an accounting of how it spend its money. Its chairwoman, Tricia Mezhir, when asked about financial specifics, will tell reporters and government officials it’s none of their business. “We’re a private corporation,” she says.
It expects the privacy that private businesses are entitled to despite being funded by taxpayers in one of the poorest cities in the country.
I recently acquired a number of private NTCC documents, including tax returns from 2004-2007, along with audits. Read them on line for yourself at www.niagarafallsreporter.com.

NTCC 2007 tax return

These documents provide the first real glimpse of the financial inner workings of this secretive organization.
The documents reveal that the NTCC is closely associated with Maid of the Mist Steamboat Company owners James and Christopher Glynn. Its chairwoman, Tricia Mezhir, is, in fact, general manager of Glynn’s Comfort Inn hotel in downtown Niagara Falls.
And Chris Glynn is listed on tax returns as an NTCC board member.
Other board members include Mayor Paul Dyster, a beneficiary of Glynn’s large campaign contributions, and USA Niagara President Chris Shoepflin, who has, coincidentally, James Glynn on his own advisory board.
There are also board members employed by Niagara University — glad tidings for the Glynns since James Glynn is a major benefactor of the university and Chris Glynn serves as a university trustee. In return, the University lends its name to studies that promote NTCC’s public image.
Curiously, though supported by bed taxes, out of 20 NTCC board members listed on 2007 tax returns, only two were Niagara Falls hotel owners. Conversely, many board members are politicians, allies or dependents of the Glynns.
The NTCC’s history is rich with Glynn influence.
In 2003, Albany persuaded/blackmailed the city to eliminate its Convention and Tourism Bureau and replace it with the NTCC, a private corporation. Funding would come from city and county bed-tax money and a 50-cent surcharge on the elevators serving Glynn’s Maid of the Mist boat ride in the Niagara Falls State Park.
It was Albany’s intention to control the city’s bed tax money and create a patronage playground. If the city refused, Albany officials threatened to hijack the city’s casino cash. The NTCC was born in 2003. Chris Glynn became its first chairman.
It was decided, however, that, rather than let the NTCC collect a surcharge from the Maid of the Mist, the Glynns would pocket any increased charges for their attraction. Hotel bed taxes, plus casino cash, could take care of NTCC funding.
The NTCC was also supposed to promote conventions. But the 9,500-seat Niagara Falls convention center was gifted by Albany to the Seneca Gaming Corporation. To replace it, Albany built a conference center that holds 3,200 people. Too small for conventions, the area lost untold millions in hotel stays. The NTCC books less than two dozen meetings a year.
The “Convention Corporation” half of NTCC’s name is, of course, fiction.
Is the other half, the “Niagara Tourism” also fictional?
One revelation contained in its tax returns is that the NTCC spends more on salaries and travel than advertising. Abnormal for a promotional agency.
NTCC President John Percy and others went on extended trips to Europe and Asia allegedly to promote tourism. Chris Glynn often travels with Percy to promote his Maid of the Mist attraction.

John Percy

John Percy

The nature of some of the exotic trips seems suspiciously like pleasure travel. NTCC executives stayed in $500-a-night rooms and spent lavishly at restaurants and other entertainment venues.
By contract, the NTCC, in order to continue to devour the region’s bed taxes, has to show it returns 15-to-1 on the taxpayer’s investment. To “prove” this, the NTCC employed a study developed by Niagara University, where Chris Glynn is a trustee.
The study works like this: Over the course of a year, people contact the NTCC. If an NTCC representative gives information, the person is counted as “serviced.” The NTCC claims it “serviced” 146,027 people.
The study then assumes these unverified people travel with an average of 1.5 other people, making a total of 365,067 people.
The study next assumes 66 percent of these, or 240,944 people, actually came to Niagara Falls, and further assumes, rather fantastically, that none of them would have come to Niagara Falls had the NTCC not “serviced” them by giving them information.
In other words, it gives itself 100 percent credit for 66 percent of people, not taking into consideration that people asking for information might have been planning to come anyway.
Next, the NTCC assumes that the 240,944 people spent $40 million here. With that, plus another $6 million for miscellaneous, the NTCC gave themselves credit for $46 million spent here.
Doing better than the 15-1 requirement, Percy, reporting this alleged “study” to the Niagara Falls City Council, said the city received a 16-to-1 return on its $2.8 million investment.
“These findings are not just pulled out of the sky,” Percy told the Council. “They are factual and solid numbers.”
Percy also gave the NTCC credit for hotel occupancy rising 7.6 percent. He failed to mention that five major hotels closed and occupancy rates may have risen because there were fewer hotels. In any event, the amount of bed tax collected remained about the same as in previous years.
He also explained that the NTCC publishes a free Visitor Guide — which prominently features the Maid of the Mist. And that the NTCC purchased a couple of advertisements in the “I Love N.Y.” travel guide, “Oprah” and “In Flight Media.”
Other marketing efforts involved attending tourist trade shows in various cities (where the delegation stayed at five-star hotels and enjoyed fine dining, with vintage wines, at taxpayer’s expense), and running a short-lived media campaign in Pittsburgh, Cleveland, Columbus and Southern Ontario.
In all, the NTCC claimed to have booked 8,841 rooms for 2007. That might sound like a lot, but Korean tour operator Andy Kim booked 10,000 rooms — single-handedly — without any taxpayer funding, and Gordon Stephens of www.niagarafall-slive.com booked more hotels on his Web site alone than NTCC did through all sources last year.
Percy also boasted of 400,000 visitors to its Web site (www.niagara-usa.com). But Stephens’ www.nia-garafallslive.com, which offers more information on Niagara Falls, had more than 2 million visitors without costing taxpayers a dime.
Percy mentioned that the NTCC met with NBC’s “Today Show” and CBS News’ “Early Show” when they came to the Falls, adding these “shows and other local broadcasts helped reach over 30 million potential travelers.” But the NTCC did not bring these shows here. The shows (like many tourists given information) were coming anyway.
One thing Percy did not mention was that in 2005, the NTCC contracted with the NY Thruway Authority to operate information booths at rest stops in Angola and Clarence. The only monetary provision was NTCC was to pay 10 percent commission to the Thruway Authority for hotel referrals. It was understood they would not sell anything.
The NTCC, however, converted the free information booths into tour selling booths — whose principal activity was pitching guided bus tours featuring the Maid of the Mist boat ride. The tour companies paid the NTCC 41 percent commission.
In 2006, the NTCC got a mere $36,000 in hotel referral fees — for which they dutifully paid 10 percent or $3,600 to the Thruway Authority. However, tour sales brought in $647,000 in commissions to NTCC. Not one dime went to the Thruway Authority.
When the Thruway Authority found out, they actually threw the NTCC out and put the contract out to bid. Doreen O’Connor of Niagara Majestic Tours, easily outbid the NTCC by simply contracting to do it the straightforward way.
Some ill-informed people criticized O’Connor for outbidding such a noble organization. But, unlike the conflicted Mezhir, who works for Glynn while chairing the NTCC, O’Connor has vowed to parcel out tours and hotel accommodations evenly, not favoring Glynn’s hotel or the Maid of the Mist attraction over others in the region.
Meanwhile, the secretive Mehzir has refused to disclose even Percy’s salary, let alone other financial details. The tax documents reveal however that Percy’s annual salary was $121,600 in 2007.
The contract with the NTCC and the city can be canceled with six months notice — a little known fact. It is perhaps time to cancel.
All the NTCC seems to do is take credit for everything and other than help the Glynns and themselves, seem to do just about nothing.

Frank Parlato Jr. can be reached at frank@frankreport.com.

 
 
 
  Copyright © 2008 Frank Parlato Jr.