Wausau will seek proposals for what city officials are terming “affordable housing” south of downtown, but the Economic Development Committee on Tuesday stopped short of defining what residents could comfortably pay.
Staff will issue a Request for Proposals at 700 Grand Ave., at the corner of Grand and Thomas Street, that seeks “developers to propose projects that would focus on bringing affordable housing to the property,” a memo from the Department of Community Development to the committee said. The property once housed a wine and coffee shop, which was torn down in 2018.
The city acquired the property in 1997 for the purpose of making a right of way or turn lane from Thomas Street or Grand Avenue, according to past city documents, a plan that did not come to fruition. In 2019, then-Mayor Robert Mielke authorized planting fruit trees on the property as a therapeutic horticulture initiative that aimed to use the practice of community gardening to provide stress relief, as well as emotional and social therapy. A group of seven jail inmates planted the trees at what is known as Gaining Ground Gardens.
The discussion on Tuesday quickly veered into the government’s role in private business and private sector’s ethics in seeking public money.
The debate began with Alder Tom Kilian suggesting that the city should clarify what it expects in terms of affordable housing. The Dist. 3 alder cited U.S. Department of Housing and Urban Development criterion on affordable housing, pointing out it should not exceed one third of the monthly income.
He added that most of the property for which RFP is being invited is in block group 2 of Census Track 7 where the median household income is $31,000 and the neighboring block’s $28,000. Both are “significantly lower than the $47,000” in Wausau in general, Kilian said. “It tends to be received better by the public because what separates revitalization from gentrification is that you are actually identifying and satisfying needs in the neighborhood, not creating developments in pricing the neighborhood out which I think ultimately leads to displacements,” Kilian added.
The very first selection criterion mentioned in the RFP is “addressing the City’s need for more affordable housing.”
Kilian suggested using the median household income of those census block groups while determining the selection of the developer.
His suggestion prompted Economic Development Committee Chair Sarah Watson to ask the Director of Community Development, Liz Brodek, whether they could use the data that was presented at the Wausau Housing Task Force’s public hearing last week.
Brodek, who has come across as someone who pushes for high-end developments, gave a long explanation of why the city should not get into setting the criteria.
“I think it might be possible to use it for valuation criteria but what we anticipate happening with this RFP is that it would be used for…WHEDA tax credit scoring and they have their own formulas that they use,” Brodek said. She was referring to Wisconsin Housing and Economic Development Authority. The director said if the city’s criteria didn’t fit with WHEDA’s, “then we have nothing, then we start over.”
It was not clear what Brodek’s purpose was in referring to the WHEDA housing tax credit score. In WHEDA’s 2021 self-scoring exhibit, the highest scoring point, 60, has been set aside for serving “lowest income residents.” If two or more applications for housing credit receive the same score, proposals that score higher in ‘areas of economic opportunity’ category will then get a priority.
Brodek claimed that the “folks” she talked to do not use a lot of local market data, especially those related to the “census tract to score those kinds of things.” She did not clarify who these “folks” are. While saying the city should make sure a project is appropriate for the neighborhood, “the point of a new development housing is to bring new people into a neighborhood as well, so it’s just not creating housing for the folks who are already there.”
Alder Lisa Rasmussen said they needed standard language and standard scales when it comes to defining affordability but it should not be too narrow in determining what it means.
The Dist. 7 alder said the local government should not get into the business of dictating market or rent rates, adding it was up to the market and the developers to decide how to price their product. “They (private sector) have to be able to pursue the market they wish to pursue and if they need any help from us…it’s up to them to create a proposal that fills that requirement.” She said the city should not invite a situation that might be construed as price fixing.
“We can request projects that are affordable but we have to let the private sector price their product,” Rasmussen said.
Most of the multi-million project proposals from the businesses based in the City of Wausau or outside have sought taxpayer assistance in millions but have resisted any government oversight.
Kilian spoke of this dynamic.
“When companies invite public money, they invite government into their business, that’s just the reality of things,” Kilian said. “And if they don’t like it, they can pay for their own projects themselves – that’s the private sector, that’s the free market.”
He added that the “model or the philosophy of ‘Let’s give the private sector a bunch of public money and just let them look out for the public good themselves’ hasn’t worked out so well.”
The city’s residents, Kilian said, have told him that they don’t think a lot of projects termed “affordable housing” are very affordable at all.
Responding to Rasmussen’s comments that the government should stay away from business, Kilian said the government bulldozed half a neighborhood just west of the property in question. “Those were affordable homes and then try to put up high-end development that no one there could really afford.” It’s a government job to safeguard the public good and not the private sector’s margins, he added.
The property is currently not located in a Tax Increment District, the RFP document noted. However, the city would be able to provide a TID assistance though a boundary amendment to a TID or through utilizing the half mile radius expenditure provision, officials said.
According to the RFP document, the proposals for the one-acre plot are due by Sept. 29.