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NIAGARA FALLS – The agency responsible for promoting Niagara Falls and Niagara County tourism will have its effectiveness evaluated under an agreement reached this week.

A Canadian firm will be hired to conduct a “performance audit” of Niagara Tourism & Convention Corp., a key term that got the Niagara Falls City Council to approve a contract extension with the agency this week.

The Council’s majority had tabled a proposed contract extension in early July amid what it said were concerns over spending by the agency and what the Falls is getting in return.

Council Chairman Glenn A. Choolokian, part of the three-member majority, said that having a “full audit” done of the agency’s spending will carry a lot of weight as the agency pursues a long-term deal with the city.

Lawmakers want “to see how money was spent” before agreeing to such a deal, Choolokian said.

The majority had suggested earlier this year that cutting ties with the agency was possible.

The deal between the city and agency will expire June 19 of next year. The agreement also ends a lawsuit filed by the agency against the city at the end of July after the city started withholding proceeds from the 5 percent tax that it collects on hotel and motel bills.

Millier Dickinson Blais, the firm that will do the evaluation, had previously submitted a bid to perform a review of the agency, but no funding was available at the time, agency President and CEO John H. Percy Jr. said.

The proposal came at a time when the local share of casino revenue was held up in a dispute between the Seneca Nation of Indians and the state, Percy said.

The firm, which has three offices in Ontario and another in Calgary, Alberta, bills itself as “Canada’s largest specialist economic development consultancy.”

Percy said the firm has done work locally in Buffalo and East Aurora.

“Their resumé is very lengthy and very credible,” he said.

Millier Dickinson Blais will be paid up to $20,000 for the review, with the funding coming out of the bed tax money paid to the agency by the city.

Percy, who said he expects the evaluation to be completed in the first quarter of next year, said his agency welcomes the analysis.

The agency had proposed the performance review in its long-term contract proposal made to the county earlier this year.

Niagara County approved a one-year deal with the agency June 18.

Percy, whose agency is seeking a long-term deal, said the lawsuit the agency had to file against the city has cost between $8,000 and $10,000.

That’s money “that could have been used in promotion and marketing” of the area, he said.

In other business, the Council approved an application for reimbursement to the federal government for some funding for the train station project near the Whirlpool Bridge.

The majority tabled the application earlier this month.

Choolokian said he sought clarification on some language in the agreement and wanted to understand the terms completely before voting on it.

The city’s consultant for the project had called the measure “a standard agreement” at the time it was tabled.

email: abesecker@buffnews.com