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Surveying the Damage 

Fair Game

Published February 24, 2010 at 10:01 a.m.

Fair Game is Seven Days’ weekly political column.

Some people just can’t stay away from Burlington Telecom. We’re talking about BT’s former general manager Tim Nulty and former city councilor and mayoral candidate, Democrat Andy Montroll.

Even though they’ve been out of the picture for months, Montroll and Nulty are part of the so-called “Group of Nine” that is stepping up to bail out BT. Montroll was an early BT supporter and served on the city’s board of finance through 2009.

Also part of that group is BT’s former marketing manager Richard Donnelly, Small Dog CEO Don Mayer and Chroma CEO Paul Millman.

The nine have offered $400,000 of their own money to help BT make its CitiCapital lease payment — on the very day the quarterly $386,000 note came due and the city failed to pay it. In return, Nulty explained, they want complete operational control of BT and to cleave its finances from Burlington City Hall.

Why come back now, when BT is struggling and is the focus of state regulatory officials, a civil lawsuit and, now, a potential criminal review?

“I have a great deal of blood, sweat and tears in BT, and I hate to see it trashed and destroyed by incompetence and misbehavior,” said Nulty. “It’s also damaging the reputation of other municipal fiber networks around the country.”

The group claims to want nothing more than in its $400,000 back, with interest, along with a short-term management contract to help rescue BT. It has lined up financier Stern Brothers to deal with BT’s debt and to be a source of more cash, if necessary.

In fact, exactly one week before BT failed to make its scheduled lease payment, a Stern Brothers official made contact with CitiCapital, according to an email obtained by “Fair Game.”

Kim Mooers, a senior vice president, asked CitiCapital to hear out her client’s proposal to help Citi “maximize” the value of its $33.5 million lease with BT.


In the meantime, the city is talking directly with CitiCapital to figure out how to make good on the quarterly $386,000 payment it missed last week.

One option is to dip into a $1 million reserve fund established to “prevent any default in the payment of Rental Payments,” according to lease documents obtained by “Fair Game.”

Mayor Kiss said the city is still in talks with CitiCapital, and before it takes up any outside offers for help, BT needs to get its current finances in better shape.

“CitiCaptial said they would not make a decision precipitously, which is a good sign,” said Kiss.

Meanwhile, the legislature may step in. Sen. Vince Illuzzi (R-Essex/Orleans), chairman of the Senate Economic Development Committee, took testimony on whether municipalities should be allowed to float taxpayer-backed bonds to fund public telecom ventures.

“I think the legislature bears some blame for the mess that Burlington is in, because we restricted how they could finance this,” said Illuzzi.

But, a democratic solution is unlikely to be a quick fix. In Burlington, such bonds require two-thirds voter approval. Beleaguered BT probably isn’t popular enough right now to pull that off.

Time In!

Boy, if only Burlington Telecom could get a “time out” like the one Gov. Jim Douglas wants to give his pals at Entergy.

The Public Service Department has referred a BT matter for “criminal review” to Attorney General Bill Sorrell. Sorrell confirmed the request, but Orleans County State’s Attorney Keith Flynn will conduct the investigation because Sorrell said he and a key deputy have worked for the city as lawyers.

PSD staff refused to comment to “Fair Game” about the complaint, but Commissioner David O’Brien chatted up the Burlington Free Press on Monday. He said the PSD turned over items related to BT’s finances, including a memo written by city attorney Joe McNeil that was written in support of BT’s refinancing with CitiCapital in 2007.

In the memo, obtained by “Fair Game,” McNeil said there was no restriction on the city to use general funds to pay for BT expenses.

O’Brien told the Freeps that McNeil failed to mention any money borrowed from the city had to be repaid in 60 days.

True, but McNeil said he did spell out clearly that none of BT’s losses could be borne by taxpayers or utility ratepayers — a key concern for any lender.

While McNeil may be the focus now, observers believe it’s only a matter of time before Chief Administrative Officer Jonathan Leopold is in the legal hot seat.

Last week, Leopold hired crack defense attorney Robert Gensburg of St. Johnsbury. Gensburg has taken on clients accused of much worse crimes than misplacing $17 million. To wit: He made national news representing detainees at Guantánamo Bay.

Who Knew What When?

On Monday, the U.S. Nuclear Regulatory Commission confirmed the claim of a Vermont Yankee whistleblower who alleged the plant had a previous tritium leak.

Not only did the leak occur, it happened in the very same spot thought to be source of the current tritium discharge — pipes in a 3-by-4-foot concrete trench known as the advance off-gas system.

The previous leak occurred in 2005, four years before Entergy officials told the state they had no knowledge of underground pipes.

The report of the leak was contained in a “plant condition report,” said Neil Sheehan, an NRC spokesman. The NRC is reviewing that report, and others.

The PSD is also reviewing its records to determine if its nuclear engineer at the time — William Sherman — was aware of the leak.

According to the whistleblower, the plant set up a tent and air filters around the leak and made a temporary fix by using “Furmanite” to seal a crack until a full repair could be made when the plant was shut down for refueling. Hard to believe the NRC and the state could miss that kind of activity.

Sherman has since been replaced by Uldis Vanags, but Sherman continues to be involved in the oversight of Entergy.

In fact, Gov. Douglas handpicked Sherman to serve on a special legislative oversight panel — you know, the panel that Entergy lied to about its nonexistent underground pipes.

Wash, rinse, spin, repeat.

Clean Dean

Between appearances on national cable talk shows, former Gov. Howard Dean found a few minutes Monday to announce his support for instant-runoff voting.

At a Church Street press conference, Dean advised IRV opponents they shouldn’t equate dwindling confidence in the current mayor with a voting system that he claims leads to cleaner, fairer elections.

“Just because you lose an election, you shouldn’t then try to change the system,” said Dean, who said he didn’t vote for Mayor Kiss. “When I go around the country talking about election reform, I point to Burlington as an example as a place that’s doing it right. More cities, and states, are moving toward IRV, and if Burlington gets rid of IRV it will be a huge step backward.”

IRV opponents claim otherwise: They point to more than a dozen towns and cities that rejected IRV after using it.

“It was an experiment, and it’s failed,” said Chuck Seleen, a New North End Democrat who is part of the One Person, One Vote effort to repeal IRV.

Survey Says!

It’s an annual ritual: State Sen. William Doyle (R-Washington) surveys Vermonters on Town Meeting Day to gauge their thoughts on “hot” topics facing the state and the nation.

Not surprisingly, the question at the top of Doyle’s 42nd annual nonscientific survey is: Should Vermont Yankee be relicensed?

Doyle will ask Vermonters their opinions on a wide range of topics being debated under the Golden Dome, including bans on cellphones and texting while driving, and the cost of health insurance. Not so with the final survey question: Should the University of Vermont reinstate baseball and women’s softball?

The cut last year angered plenty of UVM alumni, players and parents who unsuccessfully lobbied trustees to reverse their decision.

“I don’t know if there’s a chance that these teams could be reinstated,” said Doyle, “but I think the decision certainly dashed the dreams of a lot of Vermont baseball players.”

Media Notes

Popular, longtime morning radio personality Lana Wilder has been fired from her gig at Star 92.9 FM.

Wilder has been a regular voice in the local radio market since working at 95 Triple X (95.5 FM) in 1986.

“In radio you don’t often have any notice or a chance to say goodbye,” said Wilder, who has been at Star 92.9 FM for seven years. “I was just told they wanted to take the show in a new direction.”

Station owner Ken Barlow told “Fair Game” he wishes Wilder the best.

“It was decided that while the station had solid ratings in morning drive, we needed to grow listenership, and a new direction would help accomplish that,” said Barlow.

For now, Wilder is weighing her options. “I’d like to stay in radio, but I also know it’s a tough job market out there,” she said.

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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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