TWO PORTS — Mayor Chris Swanson’s efforts to lure investors into an underwater Lake Superior hotel prompted city council to call a special meeting Thursday to consider whether it crossed an ethical or legal line.
In August, Swanson appeared as a guest on the “Ask a Billionaire” podcast, where he discussed plans for an underwater hotel and $400 million submarine with “MO”
Mr O is the pseudonym of a man claiming to be a billionaire who mentors Swanson and is said to be working with him on the project to help raise “about $400 million, but it will be much more than that by the time we’re done” for the project, Mr. O said in the podcast.
In the podcast, Swanson bragged about the $11.5 million Two Harbors got from the 2020 bond bill for a new water treatment plant, suggesting he could also use his office to secure a public funding for the underwater hotel project.
“As mayor, I have a bit of leverage,” Swanson told listeners. “I was able to get quite a bit of funding from the state — different projects. Recently, we were able to secure approximately $11.5 million from the State of Minnesota through surety bonds. And so we have goodwill. We have a great opportunity and we have a really exciting and unique project.
It’s unclear exactly what Swanson’s role in the project would be – he denies having a financial interest in the project – but his use of the title of mayor to promote the project raises questions about whether he was using his position as elected for personal gain.
His podcast appearance prompted the city council to schedule a special meeting Thursday night where they will discuss “whether or not certain social media posts violate the city’s code, charter, policies or state law.”
Specifically, the board will consider Swanson’s appearance on the podcast, an unfinished project website, vibetwoharbors.com, and recent posts on Swanson’s Twitter account,
If the board finds no violation, it will “close the matter,” according to the meeting agenda . But if they do, the council “will direct the city attorney to direct the Minnesota attorney general to issue a written opinion on the matter.”
In an email Wednesday, Swanson declined a phone interview with the News Tribune because “I’m going to the meeting with as much information as you.”
When pressed by the News Tribune on whether he was using his position as mayor for personal gain, Swanson replied in an email: ‘I am very happy to help the Two Harbors projects and I encourages all types of investors and projects to occur in our community. This underwater hotel is potentially a big project for Two Harbors.
“The city has a very specific process in the event of a conflict of interest. This conflict arises whenever there is a request from the city. The policy is very clear. There were no requests or requests to the city. I have no financial interest in this project and Two Harbors is delighted to welcome projects and entrepreneurs to our town.
An unfinished but live website for the project, VibeTwoHarbors.com, listed “Mayor Swanson” and Mr. O as the project’s “crew” under model stock images.
In the podcast, Swanson said his brother, Joe Swanson, owner of Bluefin Bay Family of Resorts in Lutsen and Tofte since 2020, “agreed he would be part of the project.” Joe could not be reached for comment Wednesday evening.
Throughout the podcast, Swanson repeatedly referred to his position as Mayor of Two Harbors and a contact form on the Vibrant Two Harbors website asking “individuals who are looking for high yield investments” to fill in their details so that “Mayor Swanson will be in touch.”
The city’s ethics policy prohibits elected and appointed officials and employees from using their “official capacity” to make a statement or comment to the media without the prior approval of city council.
He also said officials and employees “should not use their official position to solicit privileges or special treatment.”
Swanson was first elected mayor in 2016 and re-elected in 2020. He is the CEO of digital marketing agency PureDriven and entrepreneur coaching service Garage Starts.
In the podcast, Mr O said that Swanson had reunited with someone who designs underwater resorts and that “we are moving forward in many ways”.
Reached by Facebook Messenger on Tuesday evening, L. Bruce Jones, who lives outside of Coeur d’Alene, Idaho, and runs Triton Submarines and Poseidon Undersea Resorts, confirmed he was in contact with the group.
“We had a casual conversation several months ago,” Jones said. “So nothing more.”
In a phone interview with the News Tribune on Wednesday, Jones said that in several conversations over the summer of 2021 with Swanson and Mr. O, he felt Mr. O was fake.
“The mayor of the town had someone he thought could fund the setup and operation of the hotel,” Jones said. “But frankly, to me, I didn’t think the guy was real.”
As he answered a few questions about the feasibility of an underwater hotel, he directed the two to a “more profitable and profitable business” – a $7.5 million tourist submarine.
“As far as I’m concerned, the deal was never real,” Jones said. “No one was really ever serious. It was mostly some sort of fishing expedition and an opportunity for whoever Mr. O was wasting my time.
Jones sent photos of the submarine to Swanson’s official town email address on July 2, according to emails Jones passed on to the News Tribune. Three days later, Swanson replied with his email from the city: “Thank you Bruce. It’s spectacular.
During a videoconference interview on Wednesday evening, the man claiming to be Mr. O would not share his real name or a video of himself. He said clients paid him between $10,000 and $50,000 “for my guardianship” and that he mentored Swanson.
In the podcast, Swanson said he considers the fees low “for the value you give.”
Mr O declined to mention any projects he has seen come to fruition when asked by the News Tribune.
“If the people in town (from Two Harbors) said to me, ‘I want to see your other projects,’ I would say to them, ‘I’ll pass,’” he said. Instead, he said he required people needing evidence to meet his lawyers in person, leave their phones outside and view documents with his name redacted.
There is very little media coverage of Mr. O and it is unknown which projects he funded until completion.
In 2017, Flint, Michigan, community advocate and former school administrator Art Wenzlaff went to radio station 1470 WFTN in Flint and said he was working with Mr. O, who said he “would cause, through Flint’s volunteers, considerable funds to be raised to fund projects and ideas” and help ease Flint’s financial woes.
Mr. O said Flint’s idea never happened; the people involved were there for themselves.
It’s unclear what the council’s concerns are with Swanson’s Twitter account,
which has been dominated lately by discussions of cryptocurrency, a digital form of currency like Bitcoin.
In several tweets, he said he wanted Two Harbors to have its own cryptocurrency.
“If Two Harbors gets a citycoin, I will use the revenue generated to mine more citycoins and embed Web3 into my city foundations,”
News Tribune reporter Adelle Whitefoot contributed to this report.