By Shereen Siewert

Members of the Wausau City Council are drawing fire for approving up to $1.7 million in taxpayer-funded incentives for a west side apartment complex, as critics point to a lack of public information about the plan.

The $17 million project, submitted by the Plover-based Lokre Company, calls for two 60,000-square-foot apartment buildings as part of The Plaza Hotel redevelopment. Under the terms of the plan, Lokre will receive a TIF grant of $450,000 up front to help defray demolition costs, plus $450,000 in reverse TIF payments in the first of the two-phase project. The second phase calls for an additional $800,000 in reverse TIF payments, according to a joint resolution by the Economic Development and Finance committees.

The council, in its final meeting Tuesday, approved the funding, one of four projects approved. But the vote was not unanimous. Outgoing council members Gary Gissellman and Mary Thao, along with Becky McElhaney, voted against the plan in part because the Lokre proposal wasn’t fully completed. Both Thao and McElhaney questioned why key details — such as why the project meets the crucial “but for” test when determining eligibility for tax increment financing — were left blank.

A portion of the Lokre application for city assistance, which shows the “but for” section blank. Source: City of Wausau documents, April 15, 2020

That meant the council approved — and taxpayers are responsible for — funding apartments without commonly supplied details such as renderings, business partners, contractors, or even rents being proposed. Council members who voted in favor of the project said they are comfortable with the plan based on conversations during committee meetings.

But several newly elected city officials are taking issue with the process by which the plan was approved. Mayor-elect Katie Rosenberg, who takes office next week, said that while the city council members who attended the committee meetings about this project might be confident their questions were answered, “part of being accountable to residents is making sure that information is easily available.”

Tom Kilian, who will be sworn in as Dist. 3 Alderman next week, is questioning why the council voted on the project at all, given the city’s declaration last month limiting business to essential matters only. In addition to the Lokre plan, the outgoing council approved the Wausau Barrel House and Cannery project, the Plaza Hotel transformation, and the purchase of county-owned property to make way for upscale town homes along the north riverfront.

Council President Lisa Rasmussen said the city’s legal team reviewed the agenda and indicated the items considered were appropriate.

Kilian disagreed.

“Several of the agenda items voted on last night appeared to be non-essential items per the city’s related declaration last month, in my opinion,” Kilian said. “Voting on non-essential items during a period of severely restricted public involvement – e.g., a pandemic – is problematic. It lends itself to bad optics and a perception that items attached to taxpayer dollars are being pushed through at the last minute with insufficient citizen involvement and input. When defining “essential” and “non-essential,” I feel that the community would value the use of common sense over an attorney’s sign-off alone.

Deb Ryan, who will be sworn in next week to represent Dist. 11, sent an email to all city council members prior to the meeting urging them to kick the Lokre application back to Economic Development for completion. She also questioned why the matter was deemed essential, and asked the council to table the proposal until the new council could meet.

Rasmussen, in her comments Tuesday to the council, said the agreement is only a starting point to ensure the development moves forward. But Rosenberg pointed to past developments in which the council had no final oversight after giving the green light to the economic development team.

One example is the purchase of Wausau Center mall. The city council in October approved a preliminary agreement with Wausau Opportunity Zone, LLC, paving the way for the group to purchase the mall for $3 million. The two-page proposal included in public documents called for a $1 million forgivable loan and transfer of city-owned assets to the LLC for $1. After the October vote, the roughly two-page proposal presented in public meeting packets eventually morphed into a 51-page agreement that includes the annual $327,000 grants, a detail that was relayed to all city council members but was not widely discussed in public meetings or included in public information packets.

The full council did not vote on the final agreement, according to a March 2 email from City Council President Lisa Rasmussen, but did not expect to after giving the green light to city staff to move forward with the plan.

That, Rosenberg suggested, is a problem.

“This body’s process has been to vote on terms and delegate development agreements,” Rosenberg said. “Voting on incomplete terms gives away the oversight responsibility away completely.”

“Starting next week, that changes,” she said.