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BT Misses Loan Payment, Says Talks with CitiCapital Remain Ongoing 

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Burlington Telecom failed to make a nearly $500,000 lease payment to CitiCapital by the end of October, yet city officials say talks with the financier remain ongoing with another meeting potentally scheduled this week.

That's according to a letter filed today with the Vermont Public Service Board by BT's attorney William Ellis. In the two-page letter, Ellis noted that the utlity remains in discusssion with its financier about how to restructure its $33.5 million lease. BT depleted a reserve fund of $1 million earlier this year to cover payments to CitiCapital it couldn't make from its own cash flow.

If CitiCapital were to claim BT in default of the lease, it could seize the utility's assets and either sell them to the highest bidder or hire a firm to manage the company and recoup any profits.

BT filed the letter with the PSB as a condition of an order handed down last month which found the municipal telecom engaged in a "wanton disregard" of various conditions of its certificate of public good.

In its ruling, the PSB required BT to provide ongoing updates to the PSB about its talks with CitiCapital — the first to be filed on Oct. 31, Sunday. BT filed their letter today.

In its letter, BT explained that talks between CitiCapital and BT's outside consultants — and day-to-day managers — at Dorman & Fawcett were ongoing.

"Beginning in June and continuing through the present, D&F has had direct discussions with CitiCapital officials and their attorneys," wrote Ellis. "Those discussions concerned restructuring the lease agreement. There has been recent communication between D&F adn CitiCapital and both sides are trying to work through this difficult situation. The city is hopeful a meeting will occur this week."

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About The Author

Shay Totten

Shay Totten

Bio:
Shay Totten wrote "Fair Game," a weekly political column, from April 2008-December 2011.

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