By Shereen Siewert

WAUSAU — Wausau City Council President Lisa Rasmussen is calling for changes in the city’s vetting process for development partners amid revelations about the troubled history of a key player in Wausau’s multi-million dollar Riverlife Village project.

Wausau Pilot and Review broke the story early Monday, which has since been picked up by other local media sources. Longtime Denver Post reporter Kirk Mitchell worked closely with the Pilot and published a story in the Post hours later.

The Pilot investigation, prompted by a Google search and verified through a number of paid background check services, court documents, and interviews, revealed that Jason Sharkey, who is the CEO of Riverlife developer Quantum Ventures, was charged with securities fraud for his alleged role in an $8.3 million real estate Ponzi scheme while he lived in Denver.

The Pilot undertook an extensive week-long investigation into the matter to ensure the two men were one and the same prior to publication.

During a meeting Tuesday of the city’s economic development committee, Rasmussen called for city officials to take stock of processes that ensure development partners are well-chosen.

“We should have better intel than an investigative reporter has,” Rasmussen said. “Vetting needs to take place before (a project) gets here.”

During a radio interview Wednesday morning on WXCO, Mayor Rob Mielke said the allegations caught the city by surprise, referring to Sharkey as an “investor” in the project.

“When the city does do development deals, there is thorough vetting, if you will, of the developer,” Mielke said. “But in the past, we haven’t investigated or done any background checks on the investor. As of yesterday, that will change.”

Economic Development Director Chris Schock, during Tuesday’s meeting, also referred to Sharkey as an investor in the multi-million dollar project, a portion of which is being funded through taxpayer dollars.

But city documents show Sharkey isn’t an investor, he is the CEO of the development firm in charge of the project, Quantum Ventures. The two roles — developer and investor — are distinctly different.

A developer is generally someone who develops new real estate properties from the ground up with the intent of selling these properties for a profit. An investor is someone who invests their money into the project. Quantum took over as developer in January.

A review of court records shows Sharkey served two years of probation during a diverted sentencing agreement. As part of a plea deal, he agreed to pay nearly $900,000 in restitution and interest in exchange for the criminal charges to be dismissed. He now lives in Wisconsin, where he continues to pay back the victims in the case. In a statement, Sharkey said that he and his wife were actually victims in the fraud, losing about $134,000 to his former employer, who has since fled the country.

Two members of the public spoke out at the meeting including former Marathon County Board member Joanne Leonard, who urged the city to rethink the entire project.

“It’s time to go back to the drawing board,” Leonard said. “We hear a million dollars has been spent, but there’s no documents. Whose money is that?”

But Schock said the project has so far met its benchmarks, and the city does have the ability to choose a new developer should that change in the future. Schock said he participates in weekly phone meetings to stay up-to-date with the project’s progress.

Sharkey, along with Quantum partners Clay Dougherty and Mike Frantz, are expected to appear at a meeting Tuesday to answer specific questions from council members and the public about the project.

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4 replies on “Council member calls for changes in ED process after Pilot report”

  1. Hopefully this story piques the curiosity of more of our council members. Curiosity and formulating good questions is a far greater asset for the citizens to have in an alderman than his ability to talk fluff in front of a camera.

  2. As one who blindly voted to add Quantum Ventures to the project with no solid information on their background, Ms. Rasmussen should first wipe the egg off her face before she pontificates to the citizens of Wausau and the need for change in the vetting process. A little caution on the front end would have saved a great deal of embarrassment to those council members who voted yes.

  3. Let’s be clear. Saying that we need a “new process” is just an attempt to deflect blame from all the elected officials and city staff who failed to do their jobs. This is a people problem not a process problem.

    All a person had to do is “google” the names of the principals and the company to find this stuff out. Wausau has two staff attorneys, two CPAs and a senior economic development professional on the payroll. Some of them have six-figure salaries and all of them have staff underneath them. Yet, the evidence is clear that no one did even the most rudimentary background check. That is a level of competence far below what should be expected from long-tenured professionals in these high-level position.

    Worse yet, Community Development Director Christian Shock has been an active cheerleader for Sharkey, Frantz and Quantum Ventures. Finance Director MaryAnne Groat and City Attorney Anne Jacobson have sat through meetings silently, despite articles in the Pilot about Frantz’s financial and legal troubles prior to the council being asked to end the development agreement with Frantz Community Investors and re-issue the agreement with the hastily formed shelf-corporation, Quantum Ventures.

    No set of guidlines or written process is going to fix what is wrong here when neither the Mayor Robert Mielker, Finance Committe Chair Lisa Rasmussen, Economic Development Chair Tom Neal nor the council as a whole will hold professional staff accountable to not providing them with accurate and timely information.

    1. Keene, you hit the nail squarely on the head. This is what I (and I’m sure others) feel is the biggest problem with ALL forms or govt, be it city, state or federal. NONE of the “players” in these situations are held accountable for their actions. I won’t even begin to give examples at the federal level. Whether you’re talking about Mielke, Schock, Groat, Jacobson, Neal, Peckham……..any of them, the taxpayer funds they’re entrusted to manage/spend are literally treated like Monopoly money.
      “Oh, we don’t have any paperwork regarding that” before committing hundreds of thousands of dollars is outright negligent at the least. I’ve said it before and will say it here again. If these “officials” would be doing this with private company funds, at the least, they’d be fired and most likely face lawsuits. I’m also pretty confident saying that I seriously doubt they manage their personal funds in this way. Yet, it’s just another day at the office when looking for ways to spend taxpayer funds on pet projects they “feel” are necessary.
      Yup. SIX figure salaries AND staff underneath them. This is exactly why I disagree with you regarding a city administrator. That position would be just another six figure salary with staff below him/her and I can assure you there would STILL be no additional guidelines to reel in this insanity and grossly irresponsible spending. IF there would be a city administrator, would the mayor position be abolished? I honestly don’t see the purpose of a mayor if there would be a person “above”, supervising. A figurehead position is something that’s certainly not needed, along with the wage(s).
      What we sorely need is first of all, a mayor who is competent and has the ability and fortitude to guide and/or take control of things when they’re obviously out of control. Can anyone honestly say that the city of Wausau has that right now? It looks to me like we have leadership in this city that basically has no discipline, leadership or accountability. Where does that start? Last time I checked, at the top. I doubt if we’d all be complaining about the people mentioned above if there was a mayor that was actively overseeing, managing and directing the positions below him. Sadly, what we currently have is nothing more than a deer staring in the headlights of an oncoming semi.

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