Wausau faces another snag in Grand Avenue affordable housing project

Damakant Jayshi

Yet another snag has surfaced regarding an affordable housing project in Wausau, with the city poised to lose hundreds of thousands of dollars in state funding should the project move forward.

City officials are tight-lipped about when exactly they knew about the risk to funding from the Wisconsin Department of Transportation for the project, which has been in the works for nearly two years.

City staff is asking Wausau whether to vacate the right-of-way on the property at 700 Grand Ave., as required by the DOT. However, in doing so, the City of Wausau will lose more than $332,000 – the price of the property bought “many years ago” – that the DOT has committed to reimburse provided the city honored its commitment to allow the right-of-way for eventual street reconstruction.

The city in 2022 awarded the Commonwealth Development Corp. of America the roughly $17 million project at the corner of Grand Avenue and Thomas Street through a Request for Proposals process.

In a letter to the Finance Committee, Public Works Director Eric Lindman said the DOT will only reimburse Wausau for the property purchase price of $332,474.92 if the property is used as a right-of-way.

His memo adds: “With the Commonwealth development proposed on this property the [right-of-way] would need to be vacated and therefore no reimbursement would be given by the DOT.”

The Finance Committee will take up the matter Tuesday evening.

One of the proposed redesigns of the road on Grand Avenue, according to the DOT, is widening the space to more safely accommodate bicycles and pedestrians. Required improvements at the Grand Avenue and Thomas Street intersection will also require additional land, city officials said.

Grand Avenue from Kent Street to Thomas Street is set for reconstruction beginning in 2030 or 2031. Lindman, in his memo, said the DOT did not have Grand Avenue on a reconstruction schedule when Commonwealth proposed the development. He said that “recent conversations with the DOT, in spring 2024, revealed the DOT now has Grand Ave. on their reconstruction list.”

According to the city documents that the staff shared with the City Council on Aug. 19, the city approved the right-of-way on 700 Grand Ave. and nearby properties nearly two decades ago.

Neither Lindman nor others have responded to questions about the potential loss of over $332,000 should the City of Wausau vacate the right-of-way to facilitate the housing project or the fate of the project should the city agree to the DOT requirement.

The City Council, on Aug. 19, approved a recommendation to hold a public hearing “to vacate certain right-of-way along East Thomas Street abutting a portion of 700 Grand Avenue and vacating a portion of right-of-way formerly known as 804-806 Grand Avenue, 810 Grand Avenue, 814 Grand Avenue, and 816 Grand Avenue.” The council’s packet has a similar language. But neither the committee nor the council packet for their meetings mention the potential financial implications.

This newspaper has reached out to Lindman asking him when the city became aware that more than $332K in DOT funding was at stake. Wausau Pilot also asked whether city officials knew about the funding issue prior to the Aug. 19 City Council meeting – in which a public hearing was set for the project – and why the revelation was not brought to the public’s attention.

Additionally, this newspaper specifically asked Lindman whether the mandatory right-of-way requirement was considered when deciding to offer this property for the housing development. He has not responded to this and other questions by press time.

Wausau Pilot has also reached out to Mayor Doug Diny with similar questions.

Not the first snag

This is yet another challenge facing the 700 Grand Ave. project.

Earlier this year, city officials identified a concrete storm sewer pipe that required removal to make way for the development. However, the developer created a new configuration that pushes the building to the south portion of the site while maintaining the same number of units. The reconfiguration avoids the utility, which means the pipe will not need to be moved.

Commonwealth plans a four-story, 50-unit affordable housing development with 15 one-bedroom, 16 two-bedroom and 19 three-bedroom lots to accommodate both single individuals and families with children. The group sought to purchase the land for $1 and receive $1.5 million in city assistance to make the project a reality.