By Shereen Siewert
Officials in Wausau will consider forgiving a $200,000 grant for a business that failed to meet benchmarks outlined in a 2012 development agreement and was sold before the agreement matured, according to city documents.
The agreement with Collaborative Domestic Solutions Center-Wausau LLC was finalized on February 14, 2012 under then-Mayor Jim Tipple, who touted the deal in a spring 2012 newsletter as “good news for the citizens of Wausau.” Under the terms of the agreement, the company received a $200,000 grant from Tax Increment District 3 that tied in a requirement to create 200 jobs within five years. According to a memo from Wausau Business Development Specialist Sean Fitzgerald, the city agreed to forgive 20 percent of the grant at the end of each year CDSC remained in the city – as long as the terms were met.
But at the end of the five-year term the company reported just 103 jobs, down from a high of 159 and sharply lower than the 200-job requirement, city documents show. Though the terms of the development agreement were clearly unsatisfied as of Feb. 14, 2017 the city took no action to steer the company toward compliance.
“No effort had been taken by the city after the fact to modify or otherwise waive the terms of the agreement to consider it in meaningful compliance,” the memo states. Development agreements in 2017 were overseen by Wausau Economic Development Director Chris Schock, who resigned shortly after then-Mayor Robert Mielke was voted out of office.
Three months before the agreement matured, Collaborative Consulting, the parent company of Collaborative Domestic Solutions Center- Wausau LLC, was acquired by CGI Group Inc. The new owners say they were unaware of the development agreement or job creation requirements at the time of sale, according to city documents, an issue that came to the forefront in recent discussions with the city.
Fitzgerald is recommending the city waive the remaining commitment for CGI, a global company with more than 76,000 consultants and professionals and more than 400 locations worldwide, after “appraising the economic, workforce development and civic contributions CGI and its staff have made to the Wausau community – as well as its intentions for continued growth of its Wausau office location.”
In his memo, Fitzgerald calls CGI a “valued corporate citizen and employer” and lists a number of local nonprofits the company has supported, noting that the company’s Wausau members “routinely contribute time and raise money for charitable organizations.”
The council could consider waiving the job requirement, amending the development agreement to include new conditions for CGI to meet or seek reimbursement of a portion or all of the city-provided funding to Collaborative.
Attempts to reach CGI officials for comment Monday were not successful.
The original development agreement was not included in the packet for this week’s Economic Development Committee meeting, when officials will review the request. The meeting is set for 5:15 p.m. Tuesday in Council Chambers at City Hall, 407 Grant St., Wausau.