Despite giving millions of dollars, taxpayers have no idea what they’re getting back from the Niagara Falls Innovation Hub

If you were to ask residents of Niagara Falls about the Niagara Falls Innovation Hub, where it’s located or what its central purpose is, the response would likely be a blank stare.

The Hub, described as a business incubator and initiative to spur investment and innovation in the city’s downtown core, has received over $8 million dollars in public funds from various government sources over the last six years without releasing any detailed financial statements or proof of any return on investments to the municipal taxpayers who are footing a big chunk of the bill. 

While municipal budgets are incredibly strained under the weight of provincial downloading and serious issues impacting vulnerable communities, there is no clear indication that spending millions of dollars on the Hub is providing any benefit to the residents of Niagara Falls.

Every year since its inception in 2019 the director of The Hub, Dan Bordenave, has appeared before council to provide an update on its initiatives. It is presented like an infomercial, but finances are not discussed—save for The Hub’s request for more money. Bordenave is typically joined by a number of speakers to tout the benefits of The Hub and how it fosters a wonderful sense of community assisting local start-ups. 

This latest request came on December 10, with Bordenave delivering a similar presentation to councillors as has been done in previous years. Again, financial information was not provided to councillors or the public, ignoring a request from Councillor Lori Lococo made in previous years to have finances of The Hub included with its annual request for more public money.

It’s hard to find an example, anywhere in Canada, of a municipality spending millions of dollars of the taxpayers’ money for a third-party community initiative, with no publicly disclosed financial statements to show where exactly the money is going and how exactly it’s being spent. Arts grants, funding for sports organizations, community programs or events that receive money through a municipality, all require detailed financial reporting to show the public, and local officials where the investments are going, how they are being spent and if council decisions to approve the taxpayer assistance meet specific criteria for the use of public funds. 

None of this has been done for The Hub.

In October, The Pointer sent questions to Niagara Falls CAO Jason Burgess, following up on questions that he had responded to earlier. After Burgess explained that $2.55 million had been provided to The Hub by the City (part of a shared funding arrangement with the federal government after the City applied for Federal Development investment for the initiative) he was asked for detailed financial statements. In total, more than $5 million was handed to The Hub by the City, according to Burgess, including the federal funding allocated through the municipal government. 

“Please provide all City documentation of the reporting to Council/taxpayers that detailed how municipal taxpayer dollars and federal taxpayer dollars were allocated to support The Hub initiative,” Burgess was asked. 

The Pointer also asked the CAO for all staff/departmental reports that detail the Federal Development partnership on The Hub; and all reports that detail the City’s funding of The Hub with all names of The Hub stakeholders, directors and key project leaders, including the names of individuals authorized to receive the more than $5 million in public funds. 

Burgess was also asked to provide the names of individuals at The Hub responsible for the allocation of public funds to businesses and other entities supported by the initiative, as well as the names of individuals working for The Hub responsible for its hiring and its finances. 

On October 8, Burgess informed The Pointer that he would not be providing the information requested and that a formal Freedom of Information application would be required to obtain the requested details.

In December, Councillor Lococo once again requested financial information from the organization in order to better inform council’s decision making for the 2025 budget discussions. 

“As councillors…there should be more financial information available to us, our ROI (return on investment) and what the businesses are bringing in,” Councillor Lococo told The Pointer. “Since it was confirmed that the Innovation Hub is now owned and controlled by the City, I suggested that we re-evaluate the programs to know what is coming out of it and that we should know a little more.  Additional information would be appreciated, such as where the benefits are, where the numbers are and what we are doing.

“The presentations at Council meetings have only included very basic information about the revenue and expenses. We have not received the detailed information that I would like to see.”

The Hub received large amounts of its initial funding after being described as an entity outside of municipal control that was not part of the City’s business.

It remains unclear how it came to be owned and controlled by the City of Niagara Falls, after it was pitched years ago as a completely independent enterprise. It has been aggressively supported by Mayor Jim Diodati since its inception. He has never explained how The Hub went from an independent, external entity that received funding from City Hall, to an enterprise now owned by the municipality.

The Pointer sent questions to CAO Burgess requesting clarification about how The Hub became a City-owned enterprise. He did not provide the information.

The Pointer reached out to Bordenave to ask questions about financial figures that were on The Hub’s website.

The Hub has claimed it received $18 million in funding. When The Pointer asked where that funding came from Bordenave clarified that the financial figure was not money The Hub had actually received, but funding the start-up companies he works with had received with The Hub’s assistance.

When asked for a breakdown of this $18 million and what those funds were used for, Bordenave declined to answer citing privacy reasons. He would not disclose what actual companies had been successful in securing grant funding.

When asked if The Hub supplies funding to businesses or its members through the money given to it by the City or FedDev, the federal development agency, Bordenave said that it does not.

Councillor Lori Lococo has repeatedly requested financial information about the Niagara Falls Innovation Hub in order to determine whether it is a good use of taxpayer dollars.

(Joel Wittnebel/The Pointer)

Following Lococo’s request in December, Council’s agenda for its January 21 budget meeting included City staff’s response. It was a brief, two-page report, with a basic rundown of the revenue and expenses projected for The Hub in 2025.  

The limited information does not explain what the City of Niagara Falls is getting for its investment into this operation, but one thing is clear, a large portion of the budget does not go toward local businesses and programming to help them. Instead, the biggest expenditure for The Hub is staffing. 

Labour, interns and “expertise” are proposed to make up $1,038,909 of the overall budget for 2025—or 66 percent of The Hub’s entire budget for the year. This is nearly four times the amount ($290,000) dedicated to operations and program expenses. According to its website, The Hub offers an “investor readiness” program, meant to “help tech-focused startups with scalable ideas secure private investments”; it runs the Magnificent Women’s Market, a seasonal program and “artisan boutique”; and other programs like business basics, E-STEAM (a field trip program for students), and Start-up Visa targeted to immigrant entrepreneurs. 

It’s unclear how these initiatives relate to tech start-ups and innovation.

(City of Niagara Falls)

When questioned by Councillor Lococo about the high cost of staffing/expertise, Bordenave said the labour budget covers 10 staff positions, each earning around $60,000 per year. He said these costs were covered by dollars from the Rural Economic Development Fund (REDF) The Hub receives. 

According to information provided by the City, funding from the REDF in 2025 is projected at $71,853, a fraction of the $672,909 proposed under The Hub’s labour budget line. This does not include the $34,000 for interns or the $332,000 being paid for “Expertise”. It’s unclear what exactly the expertise funding is used for, but The Hub’s website lists four individuals with the title “Expert-in-Residence”. 

Bordenave said that 70 percent of businesses The Hub assists are from the Niagara Region—not just Niagara Falls. 

In December 2023, Councillor Lococo told council she had discovered that while funding for The Hub was supposed to be for Niagara Falls businesses, many of the companies listed on its website were located outside of the municipality—some were outside the country. 

Only 23 out of 51 were in Niagara Falls, less than 50 percent, Councillor Lococo said. 

“I am concerned that Niagara Falls taxpayers money is being spent on businesses outside of the municipality and those businesses and jobs are not locating to Niagara Falls as intended when The Hub opened,” she said at the time. 

Serge Felicetti, Director of Business Development for Niagara Falls, responded: “As part of the FedDev dollars we used a broader approach. So there is an element that when you get these funds, that you try to support beyond your border and into the region as well.”

Felicetti also confirmed the City funds being requested at the time by The Hub would be for core funding and The Hub would not be able to operate without it.

At the same meeting Lococo was told The Hub also received funding from the Region and this would be the case in 2025. According to the information provided by the City, this does not appear to be the case as no revenue from Niagara Region is listed for this year.

Further information about The Hub’s 2024 financials were provided to council in-camera, behind closed doors. It is unclear why this information could not be shared in an open session. 

The Pointer filed a Freedom of Information (FOI) request for all financial reporting between The Hub and the City of Niagara Falls during the funding period of 2019 to 2023. The City claimed it would cost $2,470 to provide that information, requiring 80 hours of staff time to gather. It is unclear why that is the case. If The Hub was providing detailed financial information to the City, as is typically required when municipal tax dollars are spent, this information should be readily accessible to City staff. 

The City of Niagara Falls previously received federal grant funding to support The Hub’s creation in 2019. That FedDev grant came with a number of financial reporting requirements, including the submission of reports and statements “on project performance”, the FedDev website states. FedDev’s Confidentiality, Reporting and Visibility Requirements note all of this information is subject to FOI legislation. 

Councillor Lococo pointed out during last year’s budget discussions—when city council approved $700,000 for The Hub—staff said a new FedDev application had been applied for to help cover the costs. That came as a surprise to some councillors as that information had not been made public, and council never held a vote to approve any new funding application. City staff told The Pointer council approval is not required for staff to apply for FedDev grants. 

FedDev denied the application in 2024. 

In December 2024, Councillor Lococo asked if the City would once again be applying to FedDev for the $700,000 The Hub was asking for in 2025. 

“I did have some conversations with FedDev and we (the City) are in the grant review process,” Mayor Diodati responded. “They are waiting for some of the City’s financials to be updated, then they will be considering us in the new year so that’s where we’re at right now.”

Mayor Jim Diodati has repeatedly asserted the Niagara Falls Innovation Hub would help revitalize the city’s downtown core.

(Joel Wittnebel/The Pointer)

Despite Mayor Diodati’s claim a month earlier about the City being in the “grant review process”, in January 2025 CAO Burgess said the City had not applied for a new FedDev grant and he believed applying for the grant would have to wait until the fall of 2025 because of the potential for a federal election this spring. 

Burgess also stated if the City does reapply for a new FedDev grant, it would have to be brought to council for a decision and that it would have to be dealt with in camera per FedDev requirements. This is despite the claims of City staff who told The Pointer a FedDev application would not need to go to council in order to initiate the application process. It is unclear what Burgess was referencing when he suggested FedDev requests had to be decided on behind closed doors, in an in camera session which the public and the media are not allowed to attend.

The FedDev application for the initial 2019-2023 funding for The Hub did go to council for approval. It resulted in a $3,124,131 commitment by the City over four years with matching dollars from the federal government being used to support the project (Burgess told The Pointer in October that $2.55 million had been provided by the City).

The contradictions raise questions about the City’s policies and whether taxpayer dollars are being handled properly. The lack of transparency around The Hub’s finances and questions about its financial viability raise further red flags. 

It is unknown what was requested in the failed grant application because Burgess did not present it to the City council for approval.

The City has subsequently approved $700,000 in both 2024 and 2025 for funding for The Hub.

Niagara Falls CAO Jason Burgess has refused to answer questions about the lack of financial details made public about the Niagara Falls Innovation Hub.

(Joel Wittnebel/The Pointer)

The budget information for The Hub provided at the January 2025 meeting shows it owes $77,235 to the Hydro Holding company following a loan to help fix a maintenance problem in The Hub’s building on the corner of Zimmerman Street and Bridge Street. 

Once known as the Niagara Falls Ryerson Innovation Hub, it was a highly praised initiative that partnered the City of Niagara Falls and Ryerson University (now Toronto Metropolitan University) in a plan that was supposed to revitalize downtown Niagara Falls and bring large masses of people to the businesses on Queen Street. It was to be based on Ryerson’s Digital Media Zone (DMZ), operating in Toronto, which Mayor Diodati said was ranked as the top business innovation incubator in Canada.

The idea of council supporting a partnership with a university to create an innovation hub was first presented by former Niagara Falls CAO Ken Todd in a closed door meeting of council in February 2015. 

A complaint about that meeting was filed with the Ombudsman's office alleging the City of Niagara Falls violated the Municipal Act when it voted in closed session to commit $10 million toward a proposed partnership with a post secondary institution. The Ombudsman agreed, noting nothing that was discussed behind closed doors qualified as a legitimate reason under the provincial legislation that establishes the rules for when a municipal council is allowed to take matters in camera, away from the view of the public. 

When the matter appeared in open session, Todd explained the proposal required a commitment by the City of $10 million which, if approved, would receive matching dollars from a FedDev grant. Council did not have a chance to see this application as it was submitted by TMU, but it was ultimately denied.

After the first application was denied, Mayor Diodati assured the public that the deal to create a downtown innovation hub was not dead.

“(TMU) is not discouraged in any way. They see the benefits of it, especially using the iconic brand of Niagara Falls,” the mayor said at the time. 

At his 2018 State of the City address Diodati spoke about the innovation hub and explained that the City was partnering in a second grant attempt. “We’re going to partner and come together with Brock and (TMU) and we are going to create such an opportunity in our downtown that people are going to look back on what happened and realize how important it is.” 

The second application submission made to the Investing In Regional Diversification (IRD) Funding program was filed by the City of Niagara Falls in December 2018, committing just $3 million from the City, down from the previous $10 million, to create a TMU-partnered research innovation zone. City council was not provided an opportunity to see this second application either.

According to Todd, the City opted to be the one submitting the application this time following a recommendation from FedDev. Due to TMU already applying for numerous  grants that year, it was thought that the City would have a better chance. 

The second, scaled down application, submitted by the City of Niagara Falls, was approved by Ottawa.  

On September 3, 2019 FedDev Ontario Investments posted an announcement on its website noting the $3 million will “support 85 companies, commercialize 12 new innovations and stimulate diversification of the Niagara Falls economy.” 

The City Council voted to match that $3 million dollars over four years. All money paid from FedDev for The Hub would be directed to the City of Niagara Falls as the applicant and paid out on a monthly basis by the municipality along with the City’s own matching funds.

Between the City and FedDev, The Hub had been approved for approximately $1.3 million a year to operate. This was based on the revised budget submitted with the second FedDev application.

Despite the public proclamations by Mayor Diodati about how the DMZ in Toronto was revolutionary and how partnering with TMU was going to transform the downtown, no such transformation ever took place.

In March 2023 the City of Niagara Falls chose to end its partnership with TMU once the four-year FedDev grant had expired. 

The City did not make that information public. It remains unknown why that partnership was cancelled or who within the City made that decision. 

A search of council agendas and minutes does not provide any indication that the choice to cut ties with TMU ever came to council for a vote or was discussed in any way. 

Burgess, Niagara Falls’ CAO, declined to respond when asked when and why this partnership ended.  

Despite having its name originally attached to The Hub, TMU did not contribute any money to The Hub during the four-year partnership. The university was simply a consultant being paid a fee of almost $500,000 a year to provide “expertise” to The Hub.

Without TMU’s involvement, the municipality now owns and operates the Niagara Falls Innovation Hub. This significant change in the business structure raises a number of questions. 

In 2020, Ken Todd, then CAO of the City, told local media that HOLDCO, a City-owned holding company, and joint owner of Niagara Peninsula Energy Inc., owned the majority shares of The Hub and Spark Niagara owned the minority share. Spark Niagara was a private, small business incubator involved in the initial launch of The Hub. 

It remains unclear why the ownership structure for The Hub was designed in this way, and what changes have occurred since TMU’s departure. 

Did the City of Niagara Falls purchase The Hub from HOLDCO and Spark? If so, how much public money did it cost? Did the City council vote to approve buying/assuming The Hub? Did City council see the financials and deem it a sound investment? Now that the City owns The Hub, are Hub employees now City employees?

When asked these questions by The Pointer, Burgess did not respond.

City Council members, with the exception of Councillor Lococo, are not demanding financial details, which still have not been made public.

It remains unclear who at The Hub received money in the past, how it was used and if the terms of funding from Ottawa and City Hall were met. It’s unclear how more than $5 million of public funding has been used and who benefited. 

That information would explain how The Hub has spent $3,124,131 of City money and $3 million of FedDev money in four years.

With the additional financial requests for funding by The Hub in 2023, 2024 and now 2025, it could receive more than $8 million of public money over six years without ever having to explain to the taxpayers or council how that money was spent and who benefited.

Carolynn Ioannoni is a former Niagara Falls councillor and a regular contributor to The Pointer.

Email: [email protected]

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