Windsor asks Minister of Tourism to announce Boat Service Tender

Bill Windsor has sent a letter to Ontario Minister of Tourism, the Honourable Monique Smith, to ask that she issue a statement announcing that the Niagara Falls Boat Service Lease will be tendered for bids.  Windsor is one of the people who wants to bid for the rights to the boat service.  He filed a lawsuit in Divisional Court in February asking that the judges void the lease and mandate adherence to the Procurement Policy of The Niagara Parks Commission.

Windsor’s letter speaks for itself:

March 17, 2009

The Honourable Monique Smith
Minister of Tourism
Hearst Block
9th Floor, 900 Bay Street
Toronto, Ontario
M7A 2E1

Fax:  416-314-7854

Re:       Niagara Parks Commission and Maid of the Mist Steamboat Company, Limited Lease and the Report of the Integrity Commissioner

Dear Minister Smith:

Needless to say, I was delighted with yesterday’s report from Commissioner Morrison.

There is a debate now going in the media as to whether the lease was “sent back for bids.”  I am writing to ask that you issue a statement announcing that the Niagara Falls Boat Service Lease will be tendered for bids.

It is clear that instilling public confidence is very important to the Integrity Commission with the precise recommendations in Recommendation #1.  The second recommendation is “to instill public confidence in the Board and to dispel any notion that the decision to renew the lease was one made without full information or due process, it is my recommendation that in the course of the Ministry review of the lease renewal, the Ministry provide the Board the opportunity to review its decision with the benefit of knowing the Government’s expectations regarding Revenue Generating Opportunities and sound agency governance with full knowledge of all the expressions of interest received in relation to the boat-oriented tourist attraction at Niagara Falls.”

Commissioner Morrison has asked you to “provide the Board the opportunity to review its decision.”  I read your excellent Press Release yesterday, and I applaud you for your actions. 

The problem that I have is that what Commissioner Morrison wrote doesn’t seem to be as precise as it probably needs to be for The Niagara Parks Commission to act upon it properly.  Are you prepared to issue a statement that you are asking The Niagara Parks Commission to tender the lease for bids?

I have a lawsuit pending in Divisional Court to mandate that this be done.  Do we need to continue with that lawsuit?  We have no choice unless you make a definitive statement.

Another problem with an undefined position is that a tender should give all interested parties the opportunity to bid.  As much as I might enjoy being the only new bidder other than Ripley’s, I believe there will be at least eight bidders if this is tendered.  I don’t believe it would be fair for Maid of the Mist Steamboat Corporation Limited, Ripley’s, and Bill Windsor to be the only bidders.  If you make a statement now, a tender process can begin, and everyone will have a chance.  I will be happy to provide you with a contact list of at least 16 prospective bidders.

I propose this schedule:

April 15, 2009 – Finalize “Boat Service Bid Proposal” package

April 16, 2009 – Advertise for bids

May 1, 2009 –    Inspection of facilities by interested bidders

June 1, 2009 –    Bids due

July 1, 2009 –     Decision announced

This will give five months before Maid of the Mist Steamboat Company Limited’s lease expires.  I do feel that consideration should be given to a one year extension for the current Tenant.  Perhaps each bidder could be given an option of a start date of November 2009 or November 2010.

Since there is no tender package, I am taking the unusual step of preparing a “Boat Service Bid Proposal” so all interested bidders will have something to work with.  I will post this on my web site at www.NiagaraFallsBid.com. From anonymous sources, I have obtained the old lease, minutes of meetings where the new lease was discussed, the proposed new rates explanation, and two “Reports to the Commission” proposing that the lease be adopted. 

The one thing that I don’t have is the new lease.  In the interest of good governance and transparency, could you please provide this to us so we will at least have the benefit of the legal expectations as I prepare a “Boat Service Bid Proposal” and then format my bid proposal accordingly?

After all of the publicity, two ethics complaints, statements to the press by Chairman Williams, General Manager Kernahan, and some of the Commissioners, and the fact that the Commissioners have already approved Maid of the Mist’s proposal once, I respectfully submit that I do not feel the current commissioners should be allowed to evaluate the bids and choose the winner.

While Commissioner Morrison did not find “gross misconduct” on the part of Chairman Jim Williams, the report delivers a very clear message.  The Commissioner did not say there was no misconduct or that The Niagara Parks Commission handled this lease properly as I see being reported erroneously in some newspapers. 

It is my expert opinion that the lease proposal information provided to the Commissioners was totally inadequate.  I have prepared an analysis of the Maid of the Mist Lease Proposal Package that was presented to the Commissioners that reflects my opinions, and I enclose it for your review.  Please read it.  I respectfully submit that, in my expert opinion, no one could read this analysis and feel that the proposed lease should have even been considered much less approved.

Please issue a statement that the Niagara Falls Boat Service Lease will be tendered for bids.

Sincerely,

Bill Windsor

Windsor’s letter included a 15-page Review of the Proposed Maid of the Mist Boat Lease.  Windsor stated that the Commissioners were not given adequate information with which to have even considered the lease.  The financial data used to illustrate a significant change in the rate structure was 2½ to 7½ years old.  The lease was for 2009 to 2034, and there were no projections to indicate what the economic impact would be.

Windsor detailed how the proposed new rate structure is a decrease in rent.  The rates increased by 50% from 1971 to 1989, but he feels this new deal will lower the rate to 1982 levels – 12%. Windsor’s analysis is that The Niagara Parks Commission will lose at least $17 million on this new lease structure.  Maid of the Mist will make that much more at a minimum, because they also gained the ability to increase rates by up to 10% annually without approval.

Windsor’s letter also included information that was provided to the Commissioners before they voted to illustrate the significant omissions that he identified.

Maid of the Mist Steamboat Company Limited, an American-owned company by James Glynn, has operated the boat service since 1971.  The proposed new 25-year lease is projected to generate $650 million in revenue for Glynn.  Windsor says he and others should have been given an opportunity to bid on this lease of government land.

Windsor has also filed a legal action to void the lease in New York State.  The boat service departs from both Ontario and New York under two separate agreements with two separate governments.  The U.S. lease is for 40 years, and it was issued without a tender for bids.  Windsor says: “I believe the New York lease will be tendered for bids soon.  The matter is being reviewed by the Office of the State Comptroller.  I don’t see any reason why there shouldn’t be a ruling soon.”

It is Windsor’s hope that the Minister of Tourism will make this issue clear in Ontario by announcing that the lease will be tendered for bids.