Niagara Falls has millions of visitors every year, yet the cities it connects are full of poverty, crime, and desperation.

Most people want to hear about the falls themselves, death defying adventures and amazing engineering. Or they want to know the best spot to eat with their family while in town. That’s not what we care about here. We’re fascinated by the cities themselves.

There are two Niagara Falls. They’ve had a very different trajectory.

Granted, neither city is thriving. But they’re both struggling in markedly different ways, despite sharing their namesake global attraction.

 

If you’re really interested in the history of Niagara, especially the environmental issues, I highly recommend Ginger Strand’s Inventing Niagara.

The early days of the falls

The city of Niagara Falls was founded in 1892. Prior to that, it was the villages of Schlosser/Manchester, Niagara Falls, and Bellevue/Suspension Bridge. The newly formed city had a little more than 6,500 people.

This area of Western New York was part of the Indians of the Neutral Nation. They allowed the French and British to build Fort Niagara and Fort Schlosser.

Before the falls were a tourist attraction and before there was a city, they were the source of power, drawing industry to the area. Manufacturers set up shop along the Niagara river and immigrants moved there to find work.

The French were the first to build mills along the rapids of the Niagara. Once the US was founded, the land along the riverbanks were auctioned off for industrial use. Before the city was founded, Augustus Porter proposed a system of canals be built. State policies were written to encourage industry, leading to substantial air and water pollution. This policy continued after the park was created in 1885.

Between industry and tourism, Niagara Falls quickly gained train service. In 1850, 80,000 tourists a year came to town each year. The trip from New York City took 48 hours, which was incredibly fast compared to the weeks it would have taken without the train.

The first canal, feeding water to mills, was opened in 1861 by the Niagara Falls Hydraulic Power and Manufacturing Company.

Streetcars connected residents to jobs and tourists to the attractions between 1882 and 1937. They went all the way to Buffalo.

Tourism was always a part of Niagara Falls, of course. But traveling was too difficult for most people to reach the falls. Niagara Falls, NY won handily against Niagara Falls, ON when it came to tourist dollars. There were dozens of hotels. Tourists were fascinated by the tailrace of water discharged by the factories along the gorge. The power plant drew gawking onlookers.

The Ontario side of the falls was practically rural compared to the bustling hotels and shops on the New York side.

Niagara Falls’ industrial heyday

The early 1900s saw Niagara Falls become a successful industrial area, powered by the Niagara River. They manufactured paper, rubber, plastic, petrochemicals, abrasives, metallurgical products, and good union jobs.

Tourism was always there, but it wasn’t important. Let the national park take care of it. There were a few restaurants, hotels, and shops selling trinkets, but this was a union town with industrial jobs.

Of course, there were still problems. With industry comes pollution, which is especially a problem when that pollution is surrounding a world wonder. The state and the city made their priorities clear: industry could stay.

The district around the tunnel construction was surrounded by worker shanty towns. More people came to the city than there were jobs available, leading to poverty and crime.

Company towns came to the rescue. The Niagara Falls Power Company hired Stanford White to build Echota, Cherokee for “town of refuge.” This Queen Anne neighborhood, opening in 1894, had handsome rental properties with electricity and plumbing. The company sold the homes in 1910. The area fell into decline to the point where the city rehabbed some of the houses in 1960, before they realized how bad things were going to get.

Niagara Falls was one of the largest chemical producers in the world.

By the 1960s, the industrial days of Niagara Falls were ending. Modern shipping made the Niagara river a much less attractive location. Companies were reluctant to upgrade the outdated factories.

In 1956, the Schoellkopf Power Plant was damaged when a section of the Niagara Gorge wall collapsed. This led to the construction of Robert Moses’ Lewiston Power Plant. This huge infrastructure project — one of the largest hydroelectric power plants in North America — propped up the failing economy.

Soon the power plant was complete. The factories were shutting down. The population dropped in half over the next 40 years.

One of the problems of closing factories is that people are loathe to settle for the jobs that come to town afterward. As far back as anyone could remember there were good union jobs. Lifetime jobs, with guaranteed raises and pensions.

The jobs that replaced them were in nursing homes and hotels or as home health aides. They didn’t come with salaries or health insurance. They paid minimum wage.

Love Canal

The factories — and jobs — may have left town, but the chemicals stayed. For decades, companies had been allowed to dump chemicals and other toxic substances into dumps around the city.

William T. Love attempted to build a utopian Model City. A thriving 19th century city required a canal, so construction was begun before the project fell apart. The canal served as a handy place to dump toxic waste.

And then a utopian neighborhood was built on top. This wasn’t quite what Mr. Love had envisioned.

The failures of urban renewal

Robert Moses came to town and did what he does best — build a highway on prime real estate. The Robert Moses Parkway cut between the falls and the downtown.

In 1969 politicians decided that the way to fix downtown was to knock it all down. Literally. With no plan in place for what would be built.

In 1973, the Niagara Falls Convention and Civic Center opened. They decided the best way to get traffic was to eliminate the main routes through what had been downtown and build the convention center there. While it was the city’s largest off-season tourist attraction, it wasn’t a financial success. It closed in 2002.

Rainbow Center was going to save downtown. Downtowns across the country were being wiped out by shopping malls — what better than to replace the downtown with a mall?

Cesar Pelli’s Wintergarden opened in 1977. The glass garden, with its towering catwalks through the jungle, cut across Falls Street, the main pedestrian pathway bringing tourists from Rainbow Center to the falls.

The builders of the Mall of America toyed with the idea of building a giant mall, Fantasyland, where the downtown used to be. Locals were against it and the project got dropped.

The Carborundum Company and Hooker Chemicals built towering corporate headquarters — and then they were bought out. The buildings were no longer needed and there was no way to convert them to anything oriented for tourism. No one wanted all of that office space.

Enter, Howard Milstein

Then came Eddy Cogan’s idea to build a casino. Not just a casino, the Venice of America. In what seems like a cruel joke, there would be more canals, this time lined with lush plazas instead of toxic waste. The late 90s was a dark time for design.

I’m sure these plans had nothing to do with Niagara Falls, Ontario opening Casino Niagara in 1996. It was the largest casino in Canada. Then in 1998 they announced they’d build the Niagara Fallsview Casino, too.

The state legislature legalized gambling and gave him the rights to develop downtown. Unfortunately, they didn’t bother with due diligence — he had no funding for the project.

Howard Milstein, a Manhattan real estate mogul, was sold 50% of Cogan’s development rights for downtown. Later, after Cogan fell into debt again in 2002, he gained 100%.

Stalled developments and stalled hopes

The hope was that Milstein could lure other developers and financiers to rebuild the city from the ground up. Unfortunately, the city was internationally known for its corruption. Hotel chains and developers didn’t want to touch mafia territory. Not when it also came with the legal and environmental complications of building on a city that was basically a giant brownfield.

While enough of the 140 acre development zone is vacant to make the city look like a desolate wasteland, the property Milstein controls looks like swiss cheese on a map. It’s taken years to acquire pieces of privately owned land within the development zone. As of 2010, they actually controlled 85 acres. It’s certainly in their interests to keep their tax liabilities low while they gain control over the rest.

Owners of condemned properties, long abandoned, hold out for high asking prices. Milstein refuses to give in.

The city struggles to come up with money to board up or knock down abandoned houses as more and more residents walk away.

When the developers donated money to local charities and community groups, they weren’t grateful in the way developers expected them to be.

Milstein closed a playground and recreation center on property he owned. There was a confrontation with angry protesters.

The city and state repossessed the failing convention center, handing it over to the Seneca Indian tribe. They turned the convention center into a casino in 2002. This happened just as Milstein gained full development rights. Milstein saw this as a personal affront. The city poured salt in his wounds when the Seneca tribe was given permission to build a landmark hotel.

Bringing in Milstein to build a casino and a hotel and then turning around and having someone else build it — while Milstein still retains development rights for most of downtown — was a grave error. The residents of Niagara Falls continue to pay for the sins of city hall.

The city didn’t really choose Milstein, but he wasn’t the best choice of developers to pin a city’s hopes on. Yes, he’s been tremendously successful as a developer. Yes, he’s helped turn sleazy downtowns into thriving, family-friendly places. But he’s also taken his sweet time to do it. The family’s got a knack for buying vacant land, letting it sit for decades, and then cashing in when the time is (finally, eventually) right.

Milstein and the city need to work together for any sort of improvement to happen. City hall is still rife with accusations of corruption. The mayor’s office is a revolving door. Residents have high hopes and no chance of getting what they want — good jobs. And Milstein isn’t going to give in.

Developers want a cooperative city hall. Niagara Falls has never given him one. And so the city continues to crumble.

The casino

The former convention center is now on land owned by the Seneca tribe, making it sovereign land and not taxable. However, the hotel and other properties are not located on sovereign land, but they were left off of tax rolls. After a tax hike, residents uncovered this multi-million dollar discrepancy and filed a class-action lawsuit.

Then the state authorized an expansion of gaming at “racinos” and the Seneca tribe stopped making payments. The state had violated their agreement to give the Seneca tribe exclusive rights to gambling, so they would not follow the revenue sharing agreement. In 2012, back payments for Niagara Falls were up to $60 million.

For a city with a pretty small tax base, that hurts.

They’ve since stopped making payments to New York State, since their 14 year contract to operate the casinos has ended.

Mopping up

In 2001, labor union leadership for Laborers Local 91 was convicted of extortion and racketeering. The construction union had begun in the 1900s with the American Federation of Labor. By the 1960s it had been renamed LIUNA and leadership was controlled by the Italian mafia. This was the case in branches around the country.

You can imagine how those headlines made Milstein’s job of finding development partners a little tricky.

And he’s not going to pour his personal millions into this nightmare of a town.

The former mayor, Vincent Anello, was indicted on federal corruption charges in 2010, which were dropped as part of a plea deal when he pled guilty to unrelated fraud charges for an International Brotherhood of Electrical Workers deal.

That same year the NY State Attorney General was forced to get involved with the police department because of police brutality.

One in five of the city’s 50,000 residents were living under the poverty line. People had long ago stopped looking for jobs.

In 2014, the US Housing and Urban Development Office asked the Niagara Falls Housing Authority to return $1.5 million in funds that had been mis-spent.

Tourism

Throughout all of this, the tourists come. More each year. And they pass right through town on Moses’ parkway. The parkway takes them right to Niagara Falls State Park and then on across Rainbow Bridge to the casinos and hotels and games on the other side of the river.

When the Canadian dollar is strong, Canadians visit the outlet malls of Niagara Falls for bargains. Since the Canadian dollar has dropped to historic lows, the stream of shoppers flowing south has dried up.

The houses that do stand in Niagara Falls seem to mostly be boarded up. Arson is a popular pastime. Real estate speculators from around the world snap up discounted properties at online auctions.

Is it the City of Niagara Falls?

In order to qualify as a city — at least in the eyes of the the department of Housing and Urban Development agency — Niagara Falls needs to keep its population above 50,000. Once it drops below that it loses HUD funding. When a sizable portion of your residents rely on federal funding to make ends meet, this is important.

So, the city needs to convince people to move back. They tried offering to pay off student loan debts, for up to $7,000 for each new resident. They’re fighting to attract people with jobs in Buffalo — something downtown Buffalo is also trying to do, with much more success.

Signs of improvement

Not everything in Niagara Falls is currently falling down.

There are still jobs in town. The Niacet plant is still open.

Part of the problem is that what redevelopment happened, happened in the 1970s. It was a bad time for urban development. “We had a big pile of federal money, and used it to build a big pile of useless crap,” Mayor Paul Dyster told Governing in 2009. Modern Cities has a pretty dramatic before and after.

The Wintergarden was torn down and the street grid partially restored. Old Falls Street now hosts special events and lots of green infrastructure projects.

A chunk of the old Rainbow Center Mall has been turned into the Niagara Falls Culinary Institute in 2012, a project of Niagara County Community College. The culinary institute hosts the fanciest restaurant in town, Savor.

In 2016, the city got a new Amtrak and bus station. Soon it will also house a museum on the Underground Railroad.

Niagara Falls International Airport has gotten a major facelift, leading to a huge boost in passengers. It helps that Canadian taxes on aviation are high, leading residents of the Golden Horseshoe to cross the border for bargain flights. While the runway was expanded for 747s, the only time one landed was when a flight from Pearson was diverted.

Of course, they don’t actually have any international flights, even to Canada. Maybe one day.

While the famous conference center closed in 2002, there’s now a much smaller conference center. There are still hotels to choose from. Some of them have even seen recent renovations.

For those visitors who forgot that you need a passport to cross the border into Canada, there’s the Niagara Wax Museum of History and the Rainforest Cafe. They have a street art gallery. And, of course, the Seneca Niagara Casino.

There’s one thing Niagara Falls, NY has going for it — plenty of parking.

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Want to know more?

The Fall of Niagara Falls, Bloomberg

Can Niagara Falls Grow Again? CityLab

The History of Niagara Falls, NY Hotels, Niagara Falls Info

Niagara Falls Thunder Alley

Inventing Niagara: Beauty, Power, and Lies by Ginger Strand

Niagara Falls: Images of America by Daniel M. Dumych