By Shereen Siewert
Council members on Tuesday will continue their discussion with investors interested in buying the troubled Wausau Center mall, a purchase that would require at least $1.65 million in public assistance from the city.
Wausau Opportunity Zone Fund, Inc., or WOZ, is a nonprofit corporation funded by local philanthropic foundations for the sole purpose of acquiring Wausau Center. The group’s proposal asks for a $1 million forgivable loan and transfer of city-owned mall property, including the Sears building, to the corporation for $1. Wausau bought the Sears building in 2017 for $650,000 and currently owns the ground and air rights associated with the mall.
Though the entity has an official name, WOZ does not yet exist in any official capacity. As of midday Friday, the group has not yet filed incorporation papers with the state of Wisconsin Department of Financial Institutions. In an email, Mayor Rob Mielke said the LLC will only be created “if the loan is approved by the Council for the acquisition.”
The entities creating the LLC are the Dwight & Linda Davis and Judd S. Alexander foundations, Mielke said. The foundations are represented by Wausau attorney Joe Mella.
City Council President Lisa Rasmussen said Tuesday’s Committee of the Whole meeting will allow the council to ask questions about the proposal in general. No action will take place during Tuesday’s meeting, Rasmussen said.
“(The council) won’t vote on it until Oct. 1st, when we have scheduled a special council meeting to consider the proposal and act on it,” she said. “(Mella) is expected to attend on Tuesday, as council members may have additional questions for him. This should help them be better able to discuss the issue in their districts and answer questions in the lead up to the meeting where the decision will be made, as they will have time to gather the facts and documents needed.”
Under the terms of the proposal, the city would be co-owner of the mall and would remain involved as a partner in management of the property for an indefinite amount of time.
The mall is within one of several Wausau areas identified as part of a federal “opportunity zone,” part of the federal tax cuts and job acts of 2017. The program aims to drive long-term investment into designated, economically distressed areas across the country, while offering potentially lucrative tax incentives to real estate investors. Under the terms of the program, investors can defer capital gains on a previous investment if the money is reinvested into an “opportunity zone” asset. Investors can also take advantage of additional assistance such as tax increment district (TIF) funding.
During his initial presentation to the joint finance and economic development committee, Mella said the corporation already bid on the property but the offer is contingent on the city’s involvement. Without city assistance, Mella said, the WOZ will lose its bid.
“This matter has been moving fast and we have purposely tried to take our time, in order to get information and facts gathered so that residents and council members questions can be addressed in a direct way and with everything being seen in the process,” Mielke wrote, in his email.