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Shocking revelations at Holiday Market

Niagara Falls Repoerter

December 20, 2011

By Frank Parlato Jr.

The big news at the taxpayer-funded Niagara Holiday Market, aside from its continued dismal attendance, is that apparently, without disclosing it publicly, Market developer Mark Rivers is operating seven of the vending booths himself.

It is not known if he is paying standard vending fees or if he cut himself a discount, whether he disclosed his dual and conflicting roles to the city and state that provided him with $450,000 of public money, and if he is personally pocketing the profits from his booths while billing the public for the merchandise.

According to documents in the possession of the Niagara Falls Reporter, Rivers has been purchasing inventory from wholesalers on the Internet and billing them to the Niagara Holiday Market care of The Conference Center Niagara Falls. After taking possession of the products, he sells them in his various booths with apparently little or no inventory control. Much of it is a cash business.

Rivers has hired workers as sales clerks apparently for $8 per hour. As copies of checks in the possession of the Reporter show, Rivers pays them without making legally required tax withholdings. Rivers required at least one hourly worker to sign an independent contractor form after she threatened to go to the Department of Labor. This appears to be in violation of New York state labor law, since his workers are required to work according to a fixed schedule Rivers created, and $4 is deducted for their half-hour lunch breaks. These are not independent contractors, but hourly, seasonal employees.

Some of Rivers' vending booths are faring better than others, but because of the poor attendance at the Market overall, none of them appear to be doing exceedingly well.

Perhaps it does not matter much to Rivers.

After all, he got $450,000 in taxpayer money to develop a Market that probably cost less than $200,000 to build, promote and maintain.

Rivers was supposed to match taxpayer money with an equal amount of his own or outside sponsors' money, and invest that into the Market, meaning the Niagara Holiday Market was supposed to have $900,000 invested in it.

With that kind of investment, it might have been the promised, genuine European-style Holiday Market instead of the shabby, unattractive, poorly executed market that it is.

Anyone with the slightest knowledge of construction costs can easily see what was built by Rivers did not cost anywhere near $900,000. It did not even cost anywhere near $450,000 -- the amount he got from those two spendthrifts-with-the-public's-money, Niagara Falls Mayor Paul Dyster and USA Niagara local chief Chris Schoeplin.

Below is a list of booths that Rivers operates. Rivers' policy is to name the booth after the online company he gets his products from, making it appear to the public that these are unique and individual companies operating in Niagara Falls.

1. Bed Head sells pajamas for $138. The label on them reads: Made in Glamorous Los Angeles. According to someone who worked there, not one overpriced pajama has sold to date.

2. Buffalo Sabres booth sells trinkets with the hockey team logo.

3. Scosha, a Brooklyn-based online jewelry company.

4. Streamline sells specialty gifts.

5. UB2 stands for Urban Baby Bonnets.

6. Biscoff Gourmet, seller of fancy prepackaged foods.

7. Melissa and Doug Toys. According to copies of multiple purchase receipts in possession of the Reporter, Rivers buys toys from this online company whose bizarre website marketing image is that of a smart, rather savvy businesswoman, Melissa, partnered up with her extremely stupid, if not semi-retarded and cowardly boyfriend, Doug.

The Melissa and Doug booth, being a toy store during Christmastime, seems to fare a little better than Rivers' others booths. Since Rivers apparently does not account for inventory, once it is placed in the booths, there is perhaps no way of knowing just what is selling, what Rivers is pocketing and what is walking out the door.

Among other irregularities at the Market, the Reporter learned:

  • Some vendors, including Rivers himself, are charging sales taxes on what appear to be tax-exempt items like grocery products that are not consumed on premises.
  • Employees working in vending booths are paid by check drawn on a Bank of America account in the name of Brix Niagara LLC, 915 W. Jefferson St., Suite 100, Boise, Idaho. Other employees are paid by Mark J. Rivers Inc. of the same address. These paychecks, however, do not reflect withholding for state and federal employment taxes. By comparing the work schedule posted by Rivers for 16 of his full-time employees with copies of checks in the Reporter'spossession, as alluded to above, no money for unemployment, disability or other taxes was withheld.
  • Some vendors charging sales tax apparently did not post the required New York State Authorization to collect Sales Tax certificate.
  • Many doors to the vendors' sheds do not close. One door has a nail with a piece of ribbon to keep it shut, making security an issue at night after closing.
  • There is a spaghetti of illegal extension cords that present both a fire and trip hazard.
  • According to a source familiar with the operation, the Market gets its electrical power by plugging an electrical cord into one of the city street lights. Taxpayers are footing the bill for electricity for Rivers and the vendors.
  • Tents and sheds are leaking, causing clear fire hazards with propane heaters inside and large propane tanks outside. Condensation from heat from propane heaters and cold from drafts and leaking roofs are causing dripping and saturated electrical wires.
  • According to a source in City Hall, the mayor has specifically asked that the Code Enforcement Department turn a blind eye to safety enforcement.
  • Code Enforcement acting director Dennis Virtuoso told Internet television host Sal Paonessa, "I've never been down there ... the fire department and someone from my office has been there, but I haven't."

When Paonessa asked what role he played in the approval and review of the vendor buildings, Virtuoso said, "He (Rivers) came in and showed his plans, and those original plans showed his booths to be larger than they are now. Because he built smaller than what he showed us -- under 120 square feet -- he didn't have to do a lot of things like presenting architectural designs and get certain code approval."

In other words, the city told Rivers to scale down the structures, and that would let him slip under certain rules and restrictions.

Meanwhile, attendance at the Market has been almost nonexistent. According to daily reports filed by our special correspondent Johnny A. Helms of Niagara Falls, from Monday to Thursday last week there were not more than 17 people shopping at any one time during his 16 visits to the market. On weekends, it does pick up to anywhere from 30 to as many as 400 people on Saturday, but still far from the promised 7,000-per-day visitors Rivers promised before he got the funding.

Many of the 33 (we were promised 80) shops were closed last week, presumably from lack of business. Sadly, the people who helped fund the market with taxpayer money, based on Rivers' false promises, are the same people abetting the further deception of the public.

USA Niagara's website -- www.niagara-usa.com/niagara-holiday-market.html -- as of press time is filled with misleading photos and bogus information about the Market.

For instance, USA Niagara posted that the Niagara Holiday Market is "one of the largest European-style holiday markets and festivals in the United States."

With an average of 25 and on weekends up to 33 vendors, it is actually the smallest Holiday Market the Reporter could find advertised, publicized or mentioned on the Internet in the United States or Europe.

Chriskindlmarket Chicago, for instance, is a European Holiday Market that is more than twice the size. New York's Union Square Holiday Market is four times the size.

The picture USA Niagara uses on the Internet to promote the Market is not even the Niagara Holiday Market. The buildings in the background are not in Niagara Falls. The charming, well-lit vending booths bear no resemblance to the small wooden shacks and misshapen, sloppy white or gray tents actually built here.

The USA Niagara website, an official New York state government website, goes on to falsely describe the market: "Garnering inspiration from the famous 'Christmaskindlmarket's' and grand shopping arcades of Europe, the Niagara Holiday Market features the best in holiday shopping, from national retailers to local boutiques in a holiday-themed spectacle in the heart of downtown Niagara Falls."

To compare the Niagara Holiday Market to, for instance, the Dresden Striezelmarkt, now in its 577th year, or the picturesque Numberger Christkindlmarkt with its policy of offering only traditional crafts and handmade souvenirs, if done by a private-sector businessman would subject that person to civil, if not criminal charges of that type of fraud known as false advertising.

USA Niagara's exaggerations are nothing, however, compared to that conducted by Rivers himself on his official Holiday Market website, niagaramarket.com.

Rivers uses a picture of an actual European market that is clearly intended to depict his own Niagara Holiday Market. A blurb at the left top of his home page claims it's the largest such event of its kind in the country.

In describing the Market attractions, he falsely claims he has a "spectacular Christmas tree." He does not have a picture of his own Christmas tree, which is 18 feet tall, but what appears to be a cropped picture of the lighted 70-foot-tall Norway spruce at Rockefeller Center.

While advertising his skating rink, Rivers does not have a picture of his own undersized ice-skating rink, but a picture of Wollman Skating Rink in Central Park in Manhattan. Rivers cropped the picture so one does not see the well-known New York City skyline in the background.

As of press time, there was not one "real" photo from the event on his website, in spite of the fact that the Market has been open since Nov. 25.

According to Council Chairman Sam Fruscione, he will demand a final audit report for the Holiday Market. According to Fruscione, he will ask City Controller Maria Brown to study it and report to the council where the money went.

Fruscione and Councilman Robert Anderson have been the only elected officials who have questioned the market and the vast difference between what Rivers promised and what he delivered.

Meantime, we will be waiting for the final audit and report.

 

 

 
 
 
  Copyright © 2008 Frank Parlato Jr.