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A Year in the Life of Burlington Telecom 

Published December 26, 2010 at 9:10 a.m.

Ed. Note: During the last week of the year, we asked our writers to reflect on the highs and lows of 2010.

Woulda, coulda, shoulda.

That could easily be Burlington Telecom's motto. Or, its epitaph.

BT remained one of the most politically charged and financially relevant stories of the year, which is saying something when you have a nuclear power plant sprouting a new leak practically each week.

Budget battles under the Golden Dome came and went, as did entire administrations, but allegations of malfeasance and the tanking of a political dynasty in Burlington are here to stay. At least for a few more months.

Expect the first few months of 2011 to be the make-or-break time for Burlington Telecom. Though, it seems as if Mayor Bob Kiss isn't going to go out without a fight. With little credibility left among voters, and even his own party, it's hard to see how Kiss can lay legitimate claim to being the "credible" player on the field.

BT entered 2010 hobbling and under intense scrutiny after it was revealed in late September 2009 that city officials has "loaned" the utility $17 million over the course of several years and failed to repay the cash — violating BT's certificate of public good and the city charter.

It heads out of 2010 in no better shape, really, though somehow still in business.

The City Council, in response to public outcry, called for the mayor to resign and fire his top financial aide, took control of BT and worked with the state to fix its finances and come into compliance. Well, it tried to do that, anyway, but in the end it let Mayor Bob Kiss and his team try to renegotiate BT's $33.5 million lease with CitiCaptial.

Those talks fell apart in October and BT cancelled its lease agreement, allowing CitiCapital to repossess all of the equipment BT bought with the borrowed lease money. In early December, CitiCaptial notified the city it was beginning the process of evaluating what it would take and how the city would deliver it to them.

Despite holding a commanding control of the 14-member council, Democrats and Republicans haven't been able to force some changes thanks to the strong hand the mayor holds — at least legisatively. The council refused to confirm Chief Administrative Officer Jonathan Leopold's reappointment in June. But Mayor Bob Kiss refused to put Leopold on leave last October after the $17 million "loan" was first discovered.

Kiss' Progressive Party got beat badly in some key ward races in the March elections and the bid to keep instant runoff voting in the city tanked, too. But, in the end the Progressives ended the year with just one less Progressive on the council. They now have two.

Unable to seize control of City Hall, the city council empaneled a "blue ribbon" task force to closely study BT's finances and operations. What'd they find out? Essentially that BT overspent, has too few customers and can't make enough money to pay off its debts. To succeed, BT needs to find an outside partner that knows what it's doing.

Nine months later, no such outside partner has been found, though consultants hired by the city to turn BT around are allegedly in talks with outside investors and strategic partners.

At the same time, the state embarked on a fiscal review of BT. During one portion of its analysis, something caught the eyes of officials at the Vermont Attorney General's office and soon enough a criminal review was underway. By year's end, the feds got into the game, too.

As BT struggled to stay alive, the rest of telecom world was showered with federal stimulus money in the form of direct grants and low-interest loans. In July, the feds dumped $47 million on Vermont telecom ventures. Then, in August, the U.S. Department of Agriculture gave $116 million in federal stimulus grants and loans to VTel out of Springfield.

Ah, if only they hadn't gone and blown all that taxpayer money without explicit approval, BT would have been given taxpayer money to spend.

As the year comes to a close, VTel's president Michel Guite is one of the possible BT allies waiting in the wings to help the municipal utility stay alive in 2011.

To be sure, BT has few allies these days — at least politically. I guess it rubs people the wrong way when you spend $17 million of taxpayers' money and have little to show in the end.

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About The Author

Shay Totten

Shay Totten

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

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