Public Service Board Seeks Details on Telecom Lease

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Burlington officials will update the Vermont Public Service Board about Burlington Telecom next Wednesday in Montpelier. The quasi-judicial board has asked the city to be prepared to answer questions about several key provisions of its now-terminated lease with CitiCapital.

In a memo issued today to city officials, the PSB announced it's holding a status conference on its investigation into Burlington Telecom at 11 a.m. at its offices on State Street in Montpelier.

Since Burlington asked for the status conference, the PSB is asking the city to draft an agenda. However, the PSB wants to be sure the city comes prepared to talk about the effect of its defunct lease agreement with CitiCapital on BT's ability to satisfy its certificate of public good — particularly Condition 4 of its CPG.

Condition 4 reads: "In no event shall BT abandon or curtail its service or abandon all or any part of its facilities, except after receiving approval of the Board."

Aside from that general request, the PSB is seeking specific information about elements of the master lease agreement with CitiCapital.

"Because of its relevance to the subject of the status conference, the board also requests that BT be prepared to discuss the terms, rights, and obligations of the respective parties under the master lease agreement with CitiCapital, including, but not limited to, sections 4 (Termination of Lease Term), 7 (Nonappropriation), 11 (Title; Security Agreement), 20 (Events of Default) and 21 (Remedies) and to provide additional information concerning the equipment subject to the lease (see Exhibit A to Master Lease-Schedule No. 001)," wrote PSB Clerk Susan Hudson in the memo.

The lease agreement and its exhibits can be found here: Download BT Exhibit Response DPS 3-37 12-11-09

Download the PSB memo to the city of Burlington here: Download MemoReBurlTelecomStatusConf

As a result of the termination, CitiCapital can repossess all of the equipment Burlington Telecom purchased with the borrowed $33.5 million, which could include all 180 miles of fiber-optic cable, the technological brains of the network and much more.

CitiCapital has not yet said if it will seek a complete return of all the equipment or leave it in place and lease it to another telecom provider. CitiCapital has also not said what additional remedies it may seek to recoup its money.

Burlington officials claim they are working on a plan to replace any and all equipment it's returning to CitiCapital, though have offered no specifics, and its unclear what financial institution would loan the city money after it's terminated a $33.5 million lease. Mayor Bob Kiss hinted that a second lease agreement with CitiCapital could be possible. 

To date, Michel Guite of Vermont Telephone Company (VTel) has offered a small cash infusion and access to the some of the equipment BT needs to remain in business. Also, ReBoot BT has made a second bid to buy Burlington Telecom.

Along with the PSB investigtion, two other probes — one criminal and one financial — are nearing completion.

Comments

[dale tillotson]

Two hours ago the House voted to censure Charlie Rangel.
When all is said and done with BT it will be interesting to see how the offenses compare to Mr. Rangels conduct.
Bob and Jonathan's conduct here may may make rangel look like a Saint. A lot of similarities between the denial of Kiss and Rangel on their individual issues, make this ugly.

[Jimmy]

"which could include all 180 miles of fiber-optic cable"

Does the agreement specify who has to dig it up?

[Tim]

"...and Socialist governments traditionally do make a financial mess. They always run out of other people's money. It's quite a characteristic of them."

Margaret Thatcher

http://en.wikiquote.org/wiki/Talk:Margaret_Thatcher#The_problem_with_socialism

[webber]

"...and Socialist governments traditionally do make a financial mess. They always run out of other people's money. It's quite a characteristic of them."

. . . As the democratic socialist states in Europe -- to which the American Left for years has looked to as a model -- are coming to grips with.

There's just no free lunch.

[Buster]

Bob Kiss thinks Citi will give him another lease ROFL
PIMMAL (puking in my mouth a little)

I wonder if Bob knows what tongue waggin' cleaning up the Santorum means I hope they give him a pillow mint when he is finished.

It is amazing that such a delusional imbecilic person is mayor of our city.

[webber]

Yeah, and before Burlington elected this clown Mayor, they had also elected him several terms as one of their State Reps in Montpelier.

Really makes you wonder about the Burlington Prog electorate.