NIAGARA FALLS, N.Y. — To Nirel Patel it's almost as if the City of Niagara Falls is proposing to commit highway robbery just steps from the Niagara Scenic Parkway.
"You just don't do this to businesses and developers trying to recover from the COVID-19 pandemic," he said.
Patel and his family have invested millions of dollars into Niagara Falls, opening hotels and other businesses such as a Spot Coffee at the corner of 1st Street and Buffalo Avenue, next to the old Niagara Club which he is also revitalizing and expanding.
Across 1st Street from his property is a city-owned parking lot where Patel had been leasing 10 spaces for his customers and employees at a rate of $40 per space per month.
The lease agreement, he explained, allowed him to put up signs designating the spaces as reserved for his coffee shop. However, even if someone parked there with no intention of patronizing his business, he could not have the cars towed.
"It's what they call a "non-exclusive" lease, he said. And Patel would be required to pay for the spaces regardless.
Sticker Shock
When the lease recently came up for renewal he expected the city would want more money.
"We understand inflation, and year over year inflation has gone up," he said.
But Patel said he was shocked when the city told him that under a new lease his rent would increase from $40 to $200 per space per month, reflecting an increase of 400%
Patel contacted the city and made a counter offer of $55 per space per month, reflecting a 37.5% increase which he thought was more than fair.
The offer was rejected.
"This new (city) administration came in saying we want to help create a thriving business district and move the city forward, but this is taking 10 steps back," Patel said.
Mayor Says The New Price is Fair
"We want to do our best to help those businesses that are in that location, but we can no longer make the offer at the rate of what it was," insisted Niagara Falls Mayor Robert Restaino.
Restaino told 2 On Your Side he was unaware that Patel had made a counter offer. However, a review of emails between Patel and City Corporation Counsel Chris Mazur regarding the counter-proposal shows the mayor had been copied in on them.
Nonetheless, Restaino believes the new price, despite the 400% increase is justified.
The (Parking) Goose that Laid the Golden Egg
The city's parking lot is in a prime location, directly across the street from the bridge to Goat Island in Niagara Falls State Park. The city charges customers who park in the lot $20 per day Mon-Fri and $30 on Friday, Saturday, and Sunday.
This would mean that spaces could generate $800 per month and probably more according to Restaino, who says most visitors who park in the lot to visit the nearby Falls likely don't stay all day, vacating those spots for someone else to pay that rate.
"We cannot simply take spots that are clearly generating revenue and give them away," he said, in reference to the $40 Patel had been paying for the 10 spots in which anyone can park for free.
On the other hand, Patel notes that the lot is largely empty during the off-season from Labor Day until Memorial Day, and the majority of revenue derived by the city during that roughly nine-month period is from the rate he pays year-round, and any additional customers who park in the lot largely due to his nearby businesses.
"We also generate sales tax and bed taxes through our businesses," Patel said. "The city needs to look at the bigger picture."
"Some of what our general fund relies on is parking revenue," said Restaino. "If we don't generate parking revenue to fund projects and programs, the only other way for us to raise that funding is taxes and so these parking revenues present another element of our general funding plan."
"We understand the city's financial situation," said Patel. "However, milking for parking is not the solution here."
No Deal
Destination Niagara, Niagara County's official destination marketing organization with offices on nearby Rainbow Boulevard also had its parking rate for the lot increased, but not as high as Patel's.
It went from $40 per space per month to $150. However, Destination Niagara, of which Patel is a board member, reduced the number of spaces it leased from 25 to 5.
But the city won't be generating another dime from the lot from Patel.
He has decided not to continue leasing the spaces
"Not at $200 a month. That's not logical," he said.
Meanwhile, Restaino told 2 On Your Side that Patel didn't pay for his spaces last year, and owes the city $3,600.
But Patel says when he contacted city hall about renewing for 2021, he got no response, and that as far as he's concerned he's paid everything owed up to the last contracted date.
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