January, 2009 1

Project Niagara Feasibility Study

Our Analysis

 The proposal is high risk.

o There is risk in the project timetable, and therefore the financial
projections.
o The Project Timetable has everything happening in parallel in order to meet
the 2012 target date so critical to Project Niagara’s marketing strategy (and
therefore commercial viability). Key amongst the risks this presents are:
1. The omission of Parks Canada’s Environmental Impact Assessments
to confirm whether, or under what conditions or with what additional
costs, such a venture could proceed (without being harmful to the
flora and fauna of the site).
2. The assumption that regional infrastructure issues can be solved
(and funded) in time.
3. The assumption that public consultation process will introduce no
issues which drive either extra time or cost.
4. The requirement for the Federal and Provincial governments to
commit capital funding ($25.5 million each, plus $6 million each in
start-up costs) up front despite these risks to cost and schedule.
o There is risk in the financial projections.
 Initial capital funding requires $25.5 million each from the Federal and
Provincial governments, and private donors. The study notes a recent
concentration of giving to a small number of well-established charities,
stating “it may be challenging for new projects to enter the market.”
 Although it may be standard practice, cost estimates exclude site
environmental remediation, presumably likely in what is admitted to be a
“brownfield” development.
 Project Contingency is excluded from the capital cost estimates.
 Estimated costs are preliminary and likely to rise. In the words of the
architectural consultants quoted in the report, “these costs do not really
represent an estimate, but rather a model budget that provides a
roadmap.”
o There is ongoing operational risk.
 It is a late entry into a “crowded marketplace.”
 Unlike Tanglewood, which can be subsidized by the richly endowed
Boston Symphony Orchestra, operations will require ongoing donor
campaigns ($5 million a year). Again, the study notes that “it may be
challenging for new projects to enter the market.”
 The study also states that Project Niagara is a “totally new concept” and
“there are not ready models” for estimating attendance.
 The study was completed before the economic downturn. A recent
Ipsos-Reuters survey found that 72% of households have cut back on
spending, with entertainment and vacations as the top targets.
 The study offers no long-term projections, and therefore does not
account for demographic and social changes such as our aging
population, immigration or environmental sustainability.
o The proponents bear none of the risk.
 The TSO and NACO will have “no on-going financial arrangement with
Project Niagara other than that of the festival purchasing orchestral
services from them.” In other words, they plan to use the festival to
increase their revenue and stature, and take no risk.
 All funding (including donations) and operational management are
expressly separate from the TSO and NACO.

Harmony Residents Group

Harmony with the Environment Harmony for Niagara-on-the-Lake Residents
January, 2009 2

 Project Niagara assumes they can help the Town and Region “find the
resources” (from the Provincial or Federal governments) to pay for any
infrastructure costs, such as relocating the sewage lagoons. What if they
can’t?
 Is this green or brown development?
o While the intention is to protect the Carolinian forest, the site will be developed
and much of the landscape will be artificial. “Constructed landforms” will
complement the architecture of the amphitheatre, and acoustic barriers will “also
be implemented to contain and absorb sound.” Instead of natural meadows,
formal gardens will be planted. However sensitive to its natural surroundings, the
construction of an amphitheatre, support buildings, concessions, toilets for 4,500
people and “orchard” parking for 2,010 cars nevertheless constitutes
development.
o In fact, the study smacks of “greenwashing.” Developing the site is presented as
a “public rehabilitation project” that would only happen because of Project
Niagara. Similar claims are implied regarding the sewage lagoons. “Orchard
parking,” while doubtless more attractive than acres of asphalt, is indicative of the
intent to exploit and artificially enhance this natural resource.
o At the end of the day, this is still a car-centric attraction.
 The proponents are exploiting the site and the Niagara “brand.”
o The report acknowledges there is a “crowded marketplace.” The strategy is
therefore to exploit the Niagara brand. The report is rife with disjointed
references to the Shaw Festival, wineries, agriculture, heritage and the region’s
natural wonders. The curatorial approach to programming, using “themes and
storytelling,” further builds on this strategy. While innovative, it speaks to the
almost desperate need to distinguish Project Niagara from established festivals
such as Tanglewood and Ravinia. (Note: the fact that Mahler declared “Finally!
Fortissimo!” upon seeing Niagara Falls does not make his music “uniquely
Canadian”).
o While the study does clarify why the Lakeshore Road property was selected,
what stands out is less about why the site is suitable to music presentation and
more about what Project Niagara can exploit and leverage from a marketing
standpoint. The forest, the battle site, rhapsodic descriptions of vistas (e.g. “the
skyline of Toronto floating magically above the horizon”) are all referenced
repeatedly. Whatever the effect the festival may have on the site, it is clear the
site is good for the festival.
 Are the benefits real?
o Direct economic benefit to NOTL remains unclear
 TREIM (the Province’s tourism economic impact model) numbers are at
the regional and provincial level only
 Project Niagara visitors “will be welcome to bring their own food and
beverage”
o A case can be made that there is more economic benefit outside NOTL than in
 Artist accommodations will be outside NOTL
 Falls Management and OLG funded the study because they see benefit
to the Casinos
 63% of Project Niagara visitors are assumed to be already in the region
and not extending their stay, which means they will either divert spending
from other attractions, or stay elsewhere in the region where
accommodation is less expensive.
o One can argue that the TREIM model presents an inflated view of the economic
impact of Project Niagara. 79% of visitors are projected to come from Canada.
While this may bode well for Niagara, the money spent by Canadians is
essentially being diverted from expenditures elsewhere. We are recycling our
own money. Only expenditures from the 54,300 U.S. and International visitors
drive net new benefit to the economy.

Harmony Residents Group

Harmony with the Environment Harmony for Niagara-on-the-Lake Residents
January, 2009 3

o The study was completed before the economic downtown, from which some
experts predict it will take ten years to recover.
 The tone of the study detracts from its credibility.
o Hyperbolical language such as “iconic”, “high-end” and “over the top” is
dangerously out of step with today’s world. It is not green. It does not recognize
current economic turbulence or the imperative to live within our means.
o The study exaggerates and contradicts itself.
 It suggests that typical tourists are “short-stay” low expenditure types,
and claims it will “attract a different type of tourist.” It says it will do so in
concert with other “higher-end attractions such as the Shaw Festival and
the wine tours,” which implies we already have that type of tourist.
Further, its claim that 80% of visitors will already be here contradicts the
claim that “a different type of tourist” will be attracted.
 It acknowledges a traffic study is required to determine how many more
cars will be on NOTL roads as a result of the festival. But it claims that it
will simply return visitors levels to pre-2004. Since it also points out that
50% of visitors to NOTL come between June and September, Project
Niagara actually represents a 20% increase over current, and a 17%
increase over pre-2004, visitor levels.
 It reports the Region identified $5.6million was required to “make the
Lakeshore Road site accessible and safe,” yet later claims Project
Niagara “has brought forward no new infrastructure initiatives for
consideration.” This is untrue, because widening Lakeshore Road was
not in the Transportation Master Plan.
 It uses references data to its advantage, citing Year 1 figures in
reference to traffic impacts, but Year 5 figures in reference to economic
benefits.
 There is something suspicious about the assumptions on attendance.
The study assumes 210,000 people are already in the region and only
52,000 will be destination attendees. Yet current statistics are that 70%
of all visitors to the region are day trippers. That suggests a
disproportionately high percent of concert goers will come from overnight
visitors. That seems unlikely for a self-contained event within a 2-hour
drive of 9.4 million people (7.1 million Canadians), especially when the
assumed audience will be 79% Canadian.
 Given the text of the study is prone to hyperbole, exaggeration and self-
contradiction, can we really believe the numbers?

For further information, please visit http://harmonyresidentsgroup.blogspot.com/

Harmony Residents Group

Harmony with the Environment Harmony for Niagara-on-the-Lake Residents